Well, to be fair, the Depression was caused by a debt deflation. The banking sector imploded, and when the banks started failing, the bank runs started.
At that point, there was nothing else that was going to happen other than an economic implosion. Once people quit trusting the financial system, there’s very little that can be done to stimulate the economy. It’s a large part of the problem now - lots of people simply don’t trust the financial system. I don’t, and I know more about the internal workings of the US financial system than 99% of the population.
The best thing that happened to stop the free-fall of the Depression was FDR declaring that three-day “bank holiday” and claiming that only the “sound banks would re-open.” Mind you, it was a compete sham - as it took years to weed out the unsound banks after that point. But it stopped the bank runs down by creating some confidence in the system. If the runs had been allowed to continue unchecked, the Depression could have been much worse.
This tactic would never work today, as there is too much transparency about the financial system and several screaming-face financial news networks to spread bad news. What Bush should have done is make acceptance of TARP money conditional upon a complete examination of the books and derivative positions of any of these banks. It would have caused some of them to go under, but it would have restored confidence in the system when the dust cleared. As it is now, we’ve got these zombie banks - they’re dead, but they don’t know it yet, and they keep walking around, infecting the rest of the economy.
Ah you know Glenn Beck says that Coolidge was the perfect president. Him and Harding essentially marked a throwback to the hands-off presidency of the 19th century (after the activism of TR and Wilson), something we would never truly see again. And of course he also knew a Depression was coming and to wisely get out of office before it happened.
The ironic thing is that those presidents like Coolidge who actually left things be, followed the Constitution, and didn’t abuse their executive power are derided as useless do-nothings while guys like Lincoln, Wilson, and FDR who were virtual dictators are considered heroes by American historians. Why? Because people believe that they were the kind of leaders who got things accomplished.
Now Hoover was much like Nixon before Nixon. While widely reviled by liberals as a greedy evil Republican who loved seeing people suffer, in truth both men were far more like Democrats than anything. The basis of the New Deal began under Hoover and not FDR, the difference being mostly that the former was not willing to take it as far.