Canada and the Great Depression

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Canada and the Great Depression
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Causes of the Great Depression

• Easy Credit
• People needed money to rebuild after the war
• Funds were raised by going into debt, either by
  borrowing money for the bank, selling bonds or
  offer shares on the stock market
• Investors were optimistic about economic growth
  that many people rushed to purchase bonds or
  offer shares on the stock market

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• Many companies and consumers borrowed money to
  pay for large machinery (tractors - since farms
  were turing mechanical) and cars
• Advertisements encouraged the by now and pay
  later philosophy
• When the stock market crashed the companies
  demanded their loans in full
• When they did not get their money they had the
  right to reposes their merchandise

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• By the end of the depression many families were
  left with nothing - at times not even their home
• Some people made lot of money during he 1920s
  but a majority were still poor and in debt
  especially farmers who had bought machinery to
  produce more produce hoping that their products
  would continue to increase in the markets

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Causes of the Great Depression

• Over Production and Over Expansion
• Many companies expanded their factories and began
  to produce high amounts of resources such as
  food newsprint, minerals, manufactured goods and
  then they stock piled leaving a surplus
• Canadians still only made a certain amount of
  money in the form of wages thus only allowing the
  consumer to purchase so many goods, therefore, a
  surplus of shoes, cars, radios, etc. were left
  sitting in warehouses unsold

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• The build up of surplus product made owners
  nervous so they reduced production which led to
  wages being cut and lay offs

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Causes of the Great depression

• Tariffs
• Europe was devastated from the War and needed a
  surplus of manufactured goods from Canada and the
  United Sates but those countries were in debt
• They could not purchase large quantities witch
  resulted in a slowdown in international trade

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• What were tariffs? - Other countries placed high
  tariffs on imports which started a chain
  reaction. Those countries wanted to protect
  themselves from cheaper imports and wanted their
  citizens to only purchase domestically
  manufactured goods
• This resulted in the slow down in international
  trade and it came to a point were it just stopped

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Causes of the great depression

• Easy Access to the Stock Market
• Many people saw the stock market as a way to get
  rich quick
• It was not necessary to have money to buy stocks
• People could buy stocks on credit just as they
  would do when buying material goods - they would
  only need to put down a small down payment

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• Stock brokers would loan the rest of the money as
  a high interest rate (buying on Margin)
• Speculations of the stock market drove up the
  prices and there came a point where they value of
  the stock didnt represent the value of the
  company
• What would happen if the stocks began to drop?
  How would people pay their loans back?
• This happened with the stock market crash, people
  became nervous and sold their stocks quickly,
  which lowered prices the more people sold

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causes of the great depression

• Stock Market Crash of 1929
• Throughout 1929 the markets started to fluctuate
• Every time the market took a down turn it would
  make a strong come back
• Until October 24th - there was a drastic drop in
  stocks
• Many thought the situation was only temporary
• It made people nervous so they began to sell
  their stocks which dropped the value dramatically
• By

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• By Tuesday October 29, 1929 - Black Tuesday the
  value of stocks were worthless and the stock
  market in Toronto, Montreal and New York
  collapsed
• For every minute trade occurred 1 million was
  lost
• There were minor rallies in the months after but
  the major setback of Black Tuesday was too great
• Many investors who lost a great deal of money
  either could not or would not risk any more money

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• Those who did survive the crash and wanted to buy
  stocks a the reduced rate but the government and
  banks installed new tighter money lending
  policies
• Industrial output began to fall since no one was
  purchasing produces
• This led to massive unemployment no purchasing
  power downward spiral

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William lyon mackenzie king

• King was PM when the depression began
• He barely acknowledged the crisis
• He felt that if he waited it out things would get
  better
• The leader of the Conservative opposition asked
  the PM for aid that would be used to help
  struggling provinces - esp. Western Canada

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• King said that he would not give a five cent
  piece to any Conservative led province
• He did not want to give assistance to provinces
  that were opposed to his policies
• He believed that any solution to the crisis would
  come from a business-led recovery
• During a speech King said that by drawing
  attention to unemployment it would draw attention
  to the downward spiral of the economy and
  discourage foreign investors from investing in
  the Canadian economy

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• Solution - King said What is needed today if we
  are to solve any unemployment problem is to get
  more capital into the country to increase the
  investment of capital and we will get it as
  people come to have confidence in conditions
  here
• Even if King had wanted to help the provinces he
  would have had difficulty providing the funds
  because his government was constrained by debts
  incurred by loans to railway interests
• He felt that help had to come from the provinces
  and municipalities

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The response of Canadians to Kings lack of
assistance was decisive. In the federal election
campaign of 1930, King tried to distance himself
from the five cent piece remark - but it was no
use. King lost to Richard Bedford Bennett who
promised to blast his way into the worlds
markets and create trade for Canadian industries.
William Lyon Mackenzie King
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Robert bedford bennett

• Bennetts optimism was short lived and the
  Depression deepened
• The Depression was worst for unemployed, elderly
  , sick and handicapped
• Welfare, Unemployment and Medicare did not exist
• Bennett wouldnt provide for those who were not
  contributing to society

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• Bennett was one of the wealthiest men in Canada
• as the despair increased throughout the country
  Bennett was forced to put aside his views on
  self-reliance and accountability
• 1930 he introduced the Unemployment Relief Act -
  which allotted 20 million to be used for relief
  in 1930 and 1931
• Municipalities were mostly responsible for
  distributing relief

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• Bennett didnt want relief to become a federal
  problem
• Most relief came in the form of public works
  projects - cutting grass and digging ditches
• to be eligible for relief that person had to have
  no assets - no radio, telephone, car, etc
• Registering for relief was humiliating and
  difficult, often people had to line up in public
  where everyone could see

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• Relief inspectors came to check and if they found
  liquor, surplus of food or money the relief would
  end
• Citizens were encouraged to turn in those who
  were cheating the system
• Some cities required a one-three year proof of
  residence to avoid having transients who
  travelled from city to city looking for work
  taking jobs away from residents

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• Those who did qualify for relief recieved food
  vouchers, used clothing, fuel etc.
• However, the supplies were usually not enough to
  sustain everyone
• By 1932 it was apparent that the relief program
  wasnt working
• More than 1.5 million people were on relief
• But an alarm went out when people heard of the
  number of young single unemployment men roaming
  the country in search of work

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relief camps

• Job priority was given to family men
• Young single men relied on soup kitchens and
  charity to get them through
• Unrest began to grow
• Bennett saw what was going on and decided to
  search for a solution

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• Major General McNaughton (Chief of General Staff
  for the Department of National Defense) suggested
  labour camps
• Camps would be supervised by the National Defence
  and provide food, clothing and a wage of 20
  cents/day
• Men would work on federal projects - land
  clearing and building landing strips, airports,
  roads, military bases and radio communication
  systems

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• Work camps were set up in isolated areas way from
  urban centre's in existing military camps

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• Goals - to relieve the cities of these unemployed
  men, and build morale among the men through work
  and generate good work habits
• Bennett promised the tax payers that the costs
  for care of men would be kept at 1.00/person/day
• But even as costs rose to 1.30/person/day, it
  was not enough to sustain a reasonable working or
  living standard
• The government economized by cutting back on
  machinery and tools for the work projects

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• Food was not good and cooks were untrained
• At a wage of twenty cents per day most men could
  not save any money and when they left the camps
  they were just as poor as when they entered
• If the conditions were so harsh why did men go? -
  while enrolment was suppose to be voluntary most
  men had no choice
• Unemployed young men were often refused relief
  and expelled from cities

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• Camps were a last resort
• Unrest in camps began to occur - there were over
  360 strikes, riots, disturbances over a four year
  period
• The Relief Camp Workers Union, affiliated with
  the Communist party, organized active protests
• The Governments response was to deduct wages of
  the protesters and expel the ring leaders

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• The Relief Camp Workers Union began to protest
  for better wages
• the appeal was particularly successful in British
  Columbia, where discontent was very pronounced
• It was here that the On-to-Ottawa Trek began

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on-to-ottawa trek

• In April 1935 many men had had enough
• 3,000 men from British Columbias relief camps
  went on strike

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• They traveled to Vancouver and took over the city
  library and the Hudsons Bay store
• May Day 1935 - 20,000 workers and their
  supporters paraded through Vancouvers city
  streets
• Unfortunately the city could not help them it
  had very little relief money
• So when Arthur Slim Evans of the Workers Unity
  League (WUL) suggested they travel to Ottawa to
  carry their message directly to PM Bennett,
  people very enthusiastic

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• The Trek - Since the Trekkers had no money, they
  had to ride the rods (rails) to Ottawa
• 1000 strikers climbed to the top of boxcars foe
  the ride to Ottawa
• At each stop along the way they were met with
  support and many others joined them on their trek
• On June 14, 1935 the trek, comprised of 2000 men,
  converged upon Regina

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• By, now Bennett had determined that the trek
  would go no further
• Bennett ordered the railroads to refuse transport
  beyond Regina
• Eight leaders were allowed to continue on to
  Ottawa for a meeting with the PM

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• The trekkers presented their demands
• 50 cents/hour and 5 day work week
• Workers to be covered under the Compensation Act
  and have adequate first aid supplies on all
  relief jobs
• Democratically elected committee of relief
  workers to be recognized by the authorities
• Relief camps were not to be controlled by the
  Department of National Defence
• Social and unemployment insurance
• That all workers be guaranteed their democratic
  right to vote

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• Meeting Unsuccessful - the meeting with Bennett
  did not accomplish anything
• Bennett thought Evans was trying to start a
  revolution while Evans thought Bennett was a liar
• Bennett said 20 cents was a gift and that
  conditions in camp were adequate
• Evans returned to Regina determined to continue
  the trek but they knew it would be difficult to
  make their way to Ottawa

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• The Regina Riots - On July 1, 1935 trekkers and
  their supporters organized a rally in Reginas
  Market Square
• RCMP and Police moved through the crowd arresting
  the leaders
• Gun shots were heard and a riot broke out leaving
  one policeman dead, many injured and 100 arrested

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• Eight men, including Evans were convicted and
  sent to jail
• The On-to-Ottawa trek was over
• Some returned to the camps while others went home
  or set off for other destinations
• This violent end to the Trek did little to
  increase Bennetts faltering public opinion

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Social and Political Responses
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Bennetts New Deal

• In the early years of the Depression Bennett
  insisted that the economy would eventually
  recover on its own
• He felt that state intervention would only
  distort the free market economy and hamper the
  economic recovery
• A the election year of 1935 approached Bennett
  knew he had to change his tune

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• Bennett addressed the nation in a series of radio
  broadcasts and proposed a new deal to Canadians
• He proposed
• Prairie Farm Rehabilitation Act - to help restore
  and preserve farm land devastated by drought
• Canadian Wheat Board - to administer the sale of
  grain and promote higher prices for wheat

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• The Natural Products Marketing Board - to
  institute marketing prices to help farmers
  receive higher prices for their crops
• He wanted to implement health care and
  unemployment insurance but was thwarted by the
  courts
• Bank of Canada Act - to regulate credit and
  currency

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• Canadians disillusioned with Bennetts handling
  of the Depression distrusted his new found
  embrace of the New Deal
• Many saw the deal as a way to save his political
  career but it was too late
• Bennetts competition was Liberal MacKenzie King
  who made few promises other than to cancel the
  relief camps

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• King was elected the new PM and adopted some of
  the items from Bennetts New Deal as policy
• King and his government moved slowly and
  cautiously
• If Canadians wanted innovative ways of dealing
  with the depression they would have to look
  outside the government at new political parties

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The Social Credit Party

• One of the most distinctive responses arose in
  Alberta
• William Aberhart, a teacher and fundamentalist
  Christian preacher with a radio show was the
  leader
• Believed that the heart of the problem was the
  there was poverty in the midst of plenty

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• Banks refused to loan common people money because
  they saw them as a risk
• Believed in Social Credits money given to
  Canadians to increase the purchasing power,
  standard of living and manufacturing
• Aberhart decided to run for office after the
  provincial government in power rejected his
  social credit idea

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• During the election he promised 25/month to each
  Albertan to increase purchasing power
• Elected to office in a landslide vote (56 of 63
  seats)
• The morning after the election a line up outside
  the City Hall started with eager Albertans
  expecting their 25 dividend which never came

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• Aberhart and his government began a long battle
  to implement campaign promises
• The Government issued prosperity certificates
  an initiative put in place to deliver on the
  election promise of 25
• It was suppose to substitute cash and increase
  purchasing power but it failed since companies
  would not accept vouchers as money

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• Aberhart tried to get eleven pieces of
  legislation passed but the federal government
  shot them down
• This only further increased the resentment in
  western Canadians felt toward the federal
  government
• Social Credit Party provided Alberta with another
  political party alternative and remained in power
  until 1971

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Cooperative Commonwealth Federation (CCF)

• Formed in 1932
• Leader --gt J.S. Woodsworth
• Representatives of farmers groups, labour unions,
  socialist parties and intellectuals were all
  present at the founding convention

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• At the first Annual Regina Conference the party
  passed the Regina Manifesto --gt principles of
  democratic socialism (resources being owned by
  the population)
• Supported the government takeover of key
  capitalist industries - ensured that interests of
  the people were protected
• Promoted the welfare state and state sponsored
  medical care and unemployment insurance

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• Party had limited success in 1935 only winning 7
  seats
• The party has never been a serious contender but
  provided opposition to governments in power
• Pressured the government to implement Medicare,
  social housing, workplace protection and other
  social programs

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• In Saskatchewan the party had more success when
  Tommy Douglas led the party to its first victory
  in 1944
• Later it would become known as the NDP and elect
  governments in Ontario, Manitoba, and British
  Columbia

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• A lot of the early movement for change came from
  the church
• Proposed programs to regulate monopolies and
  improve conditions for farmers, workers and the
  destitute
• A new group was formed called the Union Nationale
  and ran for election but they lost in the 1936
  election by a slim margin

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• Leader was Maurice Duplessis
• He demanded - improved working conditions, aid to
  farmers and an ending to government corruption
• He thought that it was the English speaking
  minority in Quebec and the federal government who
  were the cause of Quebecs economic and social
  problems

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• Won in 1936
• Once in power they made few reforms
• Duplessis main goal was preserving Quebecs
  pride against the federal government - Preserving
  the French language, Roman Catholic religion and
  culture
• Not a separatist group but wanted more provincial
  self government and control to follow up on
  economic policies

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• Political success included giving farmers cheap
  loans. roads and electrification programs, and
  attacked those who had communist connections
• Gained support of the employers since he was
  against strikes
• Used provincial police to break up strikes

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• Illegal Actions - he would threaten any one
  against him with the loss of their job or
  government contract, and won elections by using
  faulty electoral lists and stuffed ballot boxes
• Except 1939-1944 Duplessis was in power from
  1936-39 and then from 1945-1959

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The Communist Party

• Small group that nurtured the seed of discontent
• Leader was Tim Buck
• Found a group of young men who couldnt find work
  to listen to his ideas
• Not hard to convince the men that the capitalist
  system was not able to provide for their basic
  needs

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• Federal government outlawed the party in 1931
• Their numbers and activism began to grow and take
  root
• The governments fear grew which led to the
  arrest of Tim Buck and 7 other members (jailed
  from 1932-34)
• Due to their organization skills the party held
  hunger marches, protests and strikes that
  couldnt be ignored by the government

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Aboriginal People and the Depression

• During the Depression the fate of aboriginals
  reached distressing levels
• Government did only the bare minimum (what was
  stated in the treaties)
• As the Depression became worse services to
  aboriginals were cut back to almost non-existent
  levels, such as public healthcare

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• Birth rate was twice as high, while the death
  rate was 4 times higher than other Canadians
• Conditions for Metis were worse since no treaties
  existed between them and the government
• The few provisions that were given to other
  aboriginals were not given to the Metis

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• By 1934 conditions for the Metis were so bad that
  the Alberta government had to set up a committee
  to look into the situation - the findings were
  shocking
• 90 of the population had tuberculosis,
  blindness, paralysis or syphilis
• Population was at risk of becoming extinct

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• Government response - set up six colonies and
  provide healthcare and schools
• It was not successful
• The government did remain involved in one aspect
  of aboriginal life - Residential Schools
• Boarding schools were set up off the reserves for
  young aboriginals

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• By 1920 there were 80 schools located in every
  province and territory in Canada except New
  Brunswick and PEI
• Schools were run by the government in partnership
  with religious organizations
• Goal was assimilation

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• To succeed schools were located away from
  reservations, students were not allowed to speak
  in their mother tongue, curriculum was either
  ignored or the study of aboriginal history was
  discouraged
• The emphasis of learning was labour skills for
  the males and home making skills for the females
• Living conditions were less than adequate
• Many students experienced sexual and physical
  abuse by their teachers and administrators

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• Students were uprooted from their families and
  community
• Stripped of culture and religion
• Short and long term affects were devastating
• It would take over 60 years before the last
  residential school was closed

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Canadian Culture in the Depression

• In the 1920s, Canadian artists began to explore
  abstract and non-objective painting
• While this continued into the 1930s, as the
  Depression became more severe many artists began
  to bring realism back into their art
• Images of the unemployed, foreclosed farms, and
  helplessness became the new subjects for many
  artists in Canada

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• To escape the trials of the Depression, readind
  became a more popular form of recreation
• Romance and adventure stories allowed many
  Canadians to chance to escape the life of poverty
  and despair that surrounded them
• Realism began to penetrate Canadian novels as
  authors reflected on the world around them

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• The Radio became the dominate player in Canadian
  culture during the 1930s
• Foster Hewitt and Hockey Night in Canada
  continued to be a favourite for Canadians
• The Canadian Broadcasting Corporation, formed in
  1936 which provided popular radio programs such
  as The Happy Gang and Amos n Andy which
  helped Canadians escape the gloom of
  unemployment, failing crops and poverty

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• During the Depression, Canadian culture continued
  to thrive and grow, as Canadians looked for both
  a means to escape and for comfort in the growing
  realism that reflected the pain and suffering so
  many were going through

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Questions to Think about

• Why did the third party parties that were formed
  in the 1930s have the majority of their support
  in the Prairie provinces?
• How did the Depression mark a new stage in
  government intervention in the economy and in the
  lives of Canadians?
• Why did many Canadian artists and writers turn to
  realism to express their ideas and works of art
  during the Depression?