By the latest count, President-elect Biden won more than 51 percent of the popular vote in this year’s presidential election, a larger total than received by any candidate challenging an incumbent president since Franklin Roosevelt beat Herbert Hoover in a landslide in 1932.
That earlier election also has been in the news because of the contentious transition that followed.Over the summer, journalist David Frum warned that, if Biden won, “we are likely to see a recurrence of 1932–33, when the defeated Herbert Hoover tried to sabotage the incoming Roosevelt administration in hopes of preparing his own comeback in 1936.”
But wait: Two years ago, Frum characterized the 1933 handoff very differently, noting that, as president-elect, “Roosevelt refused all cooperation, while simultaneously sabotaging Hoover’s own ability to lead during the interim.”
So, which is it? Who tried to “sabotage” whom? And what might that transition tell us about our own perilous political moment?
By any standard, the 1932–33 interregnum was a nail-biter, lasting four months in a deepening Great Depression. The 20th Amendment to the U.S. Constitution, which moved the date of the inauguration forward to Jan. 20, would not come into force until 1937; Roosevelt thus did not enter the White House until March 4, 1933.
In the meantime, the U.S. economy, which Hoover believed had turned a corner in the summer of 1932, resumed its slide. Stocks fell, agricultural prices plunged and bank closings multiplied, while the unemployment rate hovered near 20 percent. Hoover attributed this downturn to Roosevelt’s election victory and the speculation it raised that the new administration would unleash inflation, devalue the dollar, take the U.S. off the gold standard, and amass budget deficits — measures that Hoover considered potentially ruinous.
In mid-February 1933 the banking crisis began spiraling out of control as millions of panicked Americans withdrew their money and gold from the nation’s banks. People hid their savings under a mattress, in a sock, in coffee tins — anywhere but the bank.
Hoover, believing the growing wave of bank failures reflected public fear of the approaching New Deal, requested the help of his successor to contain the panic. “I am convinced,” Hoover wrote to FDR on Feb. 18, “that a very early statement by you upon two or three policies of your administration would serve greatly to restore confidence and cause a resumption of the march of recovery.”
FDR did not respond. To comply with Hoover’s request would mean associating himself with a reviled president and risk squandering political capital he would need to launch the New Deal. He also sensed that Hoover sought to box him in politically.
By March 1, alarmed at the epidemic of bank closings, Treasury Secretary Ogden Mills and other key officials urged Hoover to assume special emergency powers – under the World War I-era Trading with the Enemy Act – to control foreign exchange and gold withdrawals, and even to declare a national banking holiday. Hoover said he would use the emergency authority if Roosevelt would publicly endorse the action. FDR held firm, insisting that no mere statement on his part could stem the bank collapse. Secretary of State Henry Stimson came away from a meeting with Roosevelt believing the president-elect had decided to “put it all up on to Hoover, and evidently to get the benefit of having matters as bad as they can be now before he comes in.”
At the customary call of the president-elect and Mrs. Roosevelt on the retiring president and the first lady on March 3, Hoover quickly got through the formalities and again requested Roosevelt’s endorsement of his use of wartime emergency powers. The meeting turned acrimonious and the outcome was the same: Roosevelt refused to endorse any action Hoover might take.
At 11:30 that evening, Hoover telephoned FDR at the Mayflower Hotel and again asked for his endorsement, and again FDR declined to give it. At 1 a.m. Hoover telephoned once more. As adviser Raymond Moley sat listening to FDR’s end of the conversation, Hoover told Roosevelt that Treasury and Federal Reserve officials were still at work in the Treasury building trying to manage the crisis. According to Moley, Hoover left it at that; he told Roosevelt that he merely wanted to keep him informed. “Roosevelt thanked him and suggested that both of them turn in and get some sleep.”
By the morning of March 4, Inauguration Day, governors in 32 states had shut down the banks entirely, while in the remaining states banks were either partially closed or had strict limits on withdrawals. Overnight, the governors of New York and Illinois suspended banking in their states after it was forcefully impressed upon them that the alternative was complete collapse. The men doing the forceful persuasion were Treasury officials of both the outgoing and incoming administrations, among them FDR’s Treasury secretary, William Woodin. As Moley recounts, “with Roosevelt and Hoover hopelessly deadlocked, and with the whole banking system drifting toward catastrophe, the subordinates were to join in the sort of cooperation which they believed to be essential to the paramount interests of the nation.”
The following day, Sunday, March 5, now-President Roosevelt issued a proclamation invoking the Trading with the Enemy Act to suspend all transactions in gold and to declare a four-day national banking holiday. A second proclamation called a special session of Congress for March 9. The collaboration of Hoover’s and Roosevelt’s men continued inside the Treasury building, now focused on preparing an emergency banking bill for the special session; Mills and Woodin merely switched chairs on either side of the desk in the Treasury secretary’s office. On the evening of March 9, Roosevelt signed into law the Emergency Banking Act, which granted the president increased power to control gold outflows and foreign exchange transactions and enhanced the Federal Reserve Board’s ability to issue currency. The banking holiday was extended through the following weekend.
On Sunday evening, March 12, Roosevelt addressed the nation in the first of his radio “fireside chats.” His immediate goal was to end money-hoarding so banks could safely reopen. “I can assure you, my friends,” Roosevelt told his listeners, “that it is safer to keep your money in a reopened bank than it is to keep it under the mattress.” FDR’s speech was drafted for him by Hoover’s undersecretary of treasury, Arthur Ballantine. The president’s message had the desired effect: The following morning, as the phased reopening of banks began, customers stood in long lines to return their hoarded cash into their bank accounts. The banking system had been saved.
The iconic image of the 1932–33 presidential handoff is of Hoover sitting alongside Roosevelt for the two-mile ride down Pennsylvania Avenue to the Capitol for the inauguration ceremony on the cold, gray morning of March 4. Hoover appears somber while FDR, though hardly ebullient, grins and waves. That image of the two presidents has come to be emblematic of their contrasting fortunes and of the final act of their tense stand-off. Today, when we have a clearer notion of what political sabotage looks like during a presidential transition, it ought to make us feel nostalgic.
Bertrand M. Patenaude is a research fellow at the Hoover Institution at Stanford University, where he teaches history and international relations. He is the author of several books, including “Defining Moments: The First 100 Years of the Hoover Institution” (2019) and “Trotsky: Downfall of a Revolutionary” (2009).