The Crash and Initial Impact
• The collapse of the New York Stock Market on Black
Thursday or October 29, 1929, had immediate and
profound effects on the Canadian economy.
• The gigantic American market was closed off by
punishing tariffs; American investment abroad
ceased; and American bankers began recalling their
loans.
• Because Canada’s market was so deeply linked to the
US, it was the most desperately affected.
• The Canadian economy was geared toward the export
of minerals, lumber, newsprint, fish, and especially
wheat.
• Overproduction during the 1920s had created a glut
of materials which suddenly had no available
consumers. As a result prices fell dramatically.
The Crash and Initial Impact
• Canada received one third of its national income
from abroad, but now it was forced to fend for itself.
• As the economy ground to a halt hundreds of
thousands of Canadians found themselves on the
street without jobs, money or security.
• Recall that at this time there was no relief, no social
welfare, and no unemployment insurance.
• The rich and elite in Canada viewed this mass
employment as an indication of character weakness
rather than as a failure of the capitalist economic
system.
• For example, the wealthy John Eaton argued that the
Depression was a worthwhile experience since it
taught men the value of a job.
Impact on Western Canada
• The western provinces were the hardest hit by the
Depression
• Saskatchewan suffered the most.
• The price of wheat per bushel fell from $1.65 in 1929
to $0.30 in 1931
• This devastated the provincial economy that was so
dependent on the crop.
• Natural disasters such as grasshoppers, rust, drought
and drifting soil further compounded the troubles in
agriculture.
• Alberta was also hit hard.
• As a younger province Alberta couldn’t afford high
interest rates, yet theirs were the country’s highest.
Their problem was one of debt, not destitution.
Impact on Western Canada
• In Manitoba, the economy of Winnipeg
collapsed when the East-West railway trade
slowed down. Thousands of unemployed
residents were joined by indigent farmers and
labourers drifting into the city looking for nonexisting jobs.
• In B.C, a province dependent on the export of
minerals and lumber, unemployed workers
poured into Vancouver.
• One disgusted citizen remarked that
Vancouver had become “just a blamed summer
resort for all the hoboes of Canada”
Impact on the Rest of Canada
• The impact on the Maritimes was felt to a
lesser degree because the region had been in
a continuous depression since Confederation.
• In Southern Ontario and Montreal
unemployment reached new highs as the huge
manufacturing complex of Canada’s industrial
heartland ground to a halt.
Initial Response of Mackenzie King
• The Prime Minister at the
start of the Great
Depression was Liberal
William Lyon Mackenzie
King.
• King was a born conciliator
and traveled a middle road
which allowed him to govern
for longer than any other PM
in Canadian history.
• King believed that the
Depression was only a
“temporary seasonal
slackness”
Initial Response of Mackenzie King
• His remedies of balancing the budget and slashing
government expenditures were useless and name. All
they did was make the economic crisis worse.
• When King received desperate requests from provincial
and municipal government for financial assistance, he
passed them off as a Tory (Conservative) plot to
undermine his Liberal government.
• As King told the House of Commons in April, 1930:
– “as far as giving moneys out of the federal treasury to any
Tory government in this country for these alleged
unemployment purposes I would not give them a five cent
piece.”
• Although he later regretted the comment, the
damage was done and King was seen as wildly
indifferent to the conditions of the unemployed.
The 1930 Election and Bennett in Command
• R.B. Bennett, leader of the
Conservative Party, was
ready and waiting in the
wings after King’s 5 Cent
gaff.
• Bennett was tall, imposing
and immaculately groomed.
• A millionaire, he was rarely
seen without his top hat,
tail coat, patent leather
shoes and cane.
• Nicknamed “bonfire”
Bennett, he was a fiery
speaker who was once
clocked at 220 words per
minute.
The 1930 Election and Bennett in Command
• During the 1930 election campaign, King tied to avoid the issue of
the Depression while Bennett emphasized his solution of a tariff
that would “blast a way” for Canadian goods into world markets.
• 14% of the Canadian workforce was unemployed but King didn’t
really recognize it as a priority campaign issue.
• This was the first federal campaign in which radio was extensively
used and Bennett proved to be superior to King as a communicator.
• The Tories won the election by a landslide and the Depression
became Bennett’s problem to solve.
• There was no way that someone with Bennett’s background and
philosophy could solve the problems of the greatest economic crisis
in Canadian history
• Bennett was a conservative who believed in sound, hard currency
and disliked spending money on massive public works or relief
payments. He believe that a balanced budget would help right the
Canadian economy.
• He also shared the elitist attitudes of upper-class citizens. He once
remarked, “one of the greatest assets a man can have on entering
life’s struggle is poverty.”
The 1930 Election and Bennett in Command
• Bennett did have some early accomplishments.
• First, he followed through on his election promise and raised the
tariff
• Second, he did spend ten times more on relief for the out of work
than had been spent in the previous decade.
• Still, Bennett argued that provinces and municipal governments
would have to pay for most of the costs of dealing with the
Depression.
• Bennett’s higher tariff did not have the desired effect and even his
creation of the Bank of Canada to give greater stability in national
finances was left to the private sector.
• Bennett’s attempts closer economic relations with Britain were also
rebuffed.
• By 1933, almost one-third of Canadians were out of work during the
worst year of the Depression.
• Bennett’s lack of solutions had made him a highly unpopular Prime
Minister. A newspaper came to be called a Bennett blanket and a
permanently out of gas car pulled by horses was referred to a
Relief Camps and the On-to-Ottawa Trek
• One of Bennett’s few
attempts to address the
issue of unemployment
backfired.
• The thousands of
unemployed men traveling
the country by rail came to
be seen as a threat and
were being arrested for
vagrancy.
• Bennett created relief work
camps run by the
Department of National
Defense that provided work,
food and shelter for these
“single homeless persons”
Relief Camps and the On-to-Ottawa Trek
• 175,000 inmates passed through the work camps.
• Though some camps were well run, comfortable and treated
workers with respect, many were more like prisons.
• The pay was 20 cents per day, food was terrible, and bedbugs
plentiful.
• The work of clearing land for highways and airports in
swampy, mosquito-infested areas was hard.
• Also, camps were isolated in the bush, did not allow women
inside and forbade entertainment or alcohol.
• Relief camp workers began to organize a Relief Camp Workers
Union and took their case to the city of Vancouver. They
demanded better conditions and better pay.
• From there, they decided to go directly to Parliament Hill to
complain.
• Hopping on east-bound freight trains the On-to-Ottawa Trek
had begun.
Regina• Riot
This picture shows trekkers
•
•
•
•
in Regina before the riot.
The trekkers gathered more
unemployed workers as they
stopped in every city.
After talks collapsed
between Bennett and march
leaders, the order for
trekkers to clear out of
Regina was given.
The resulting Regina Riot on
July 1, 1935 saw trekkers
battle Mounties and city
police until the city was
cleared.
A city detective had died in
the fighting and 130 strikers
were arrested.
Regina Riot
• Bennett saw the On-to-Ottawa trek as
the work of dangerous subversives in
the Communist party and, indeed,
there were numerous communists
involved in organizing the campaign.
• Bennett used Section 98 of the
Criminal Code to arrest prominent
Communists like party leader Tim
Buck and, when possible, to deport
radicals.
• The R.C.M.P. was order to infiltrate
trade unions, organization of the
unemployed and other “subversive”
groups.
• Civil liberties were trampled in the
“anti-red” hysteria of the time.
• Bennett’s handling of the On-toOttawa Trek and the Regina Riot was
seen by many as heavy-handed and
King was able to exploit this during
the 1935 federal election.
Impact on Canadian Women
• Due to the sexism of the times, women were largely
ignored during the Depression
• The domestic sphere was still held to be women’s
“proper place”, thus women every job held by a
woman was viewed as a job taken away from a male
“breadwinner”.
• Most school boards, professional organization,
governments, manufacturers, and retailers stopped
hiring women.
• Many women turned to domestic work in order to
survive.
• This reversed the trend of the previous two decades
which had seen women moving into sales, clerical
and even professional jobs.
Impact on Canadian Women
• Wages for domestic workers were abysmally low, in
some cases less than $4/week
• Between 1921 and 1936 the number of domestic
workers doubled but their wages decreased by half.
• Also, minimum wage laws which were passed to
protect women backfired when employers fired
women to employ the cheaper and unprotected
labour of male workers.
• There were no specific measures for unemployed
women as there were for men – no work camps, no
public works programs.
• The hardest hit among women turned to prostitution
if they could not find a male to support them.
New Ideas
• For the first time a significant
number of Canadians began to
examine the existing economic,
social, and political systems and
found them unsatisfactory.
• Both the Liberal party under
Mackenzie King and the
Conservative party under
Bennett had provided very few
concrete solutions to the
problems facing Canadians
during the Depression.
• It was in Western Canada that
many alternative parties began.
• In 1932 the Co-operative
Commonwealth Federation was
founded out of an alliance of
farmer groups, socialists and
labour parties.
New Ideas
• The CCF’s Regina Manifesto called for an end to the capitalist
system based on “domination and exploitation”.
• The CCF promoted public ownership of a financial institutions,
public utilities, and transportation companies. It favoured
production for use rather than production for profit.
• J.S. Woodsworth, a Methodist minister, was the CCF’s founder
and used the Social Gospel of Christianity, rather than Marxism,
to argue for socialism.
• The CCF had some early successes. A handful of members sat as
M.Ps in parliament, while the party became the official
opposition in B.C. and Saskatchewan.
• Despite its moderate tone and non-violent approach, to some the
CCF still seemed too similar to communism.
• The right-wing party that emerged during the thirties was Social
Credit.
• William “Bible Bill” Aberhart was a fundamentalist lay preacher
whose fiery sermons attracted very large radio audiences in
Alberta.
Social Credit
• Social Credit argued that since
there was never enough money
available to buy the always
available goods and services,
governments should issue
“social dividends”, or cash
payments, to everyone.
• While most economists
dismissed this theory, Aberhart
forged on inspired by his new
economic fundamentalism.
• During the 1935 election,
Aberhart capitalized on the
demoralized and scandalridden nature of the John
Brownlee administration.
Aberhart won a landslide
victory to become Alberta’s
Premier.
Social Credit
• When Aberhart attempted to implement his
Social Credit policies, they were disallowed by
the federal authorities or by the courts.
• Social Credit ended up providing Alberta with
a solid, free-enterprise, conservative
government for the next generation, but its
theories were only used for campaign rhetoric.
• Thus, one of the important effects of the
Great Depression in Canada was the
emergence of viable “Third parties” and an end
to the two-party system.
Bennett’s New Deal
• By the end of 1934, the economy was worsening,
western sectionalism was rising, and every
Conservative provincial government was gone.
• Bennett, a champion of the status quo and a classic
conservative, began doubting his own policies and
made a surprising swing to the left.
• Bennett drew inspiration from US President Franklin D.
Roosevelt and his New Deal.
• In January 1935 Bennett made a national radio
broadcast in which he declared that the old order was
gone and that it was time for a new society.
• This would include unemployment insurance,
subsidized housing, and minimum wage legislation.
• Capitalism was in need of reform and Bennett argued
that he was ready to do it.
•
•
•
•
•
•
Bennett’s
New
Deal
Bennett quickly brought in one of the most far-reaching reform packages in
Canadian governmental history.
Government money flowed into New Deal programs such as:
– The Prairie Farm Rehabilitation Act (to restore and preserve droughtaffected lands)
– The Canadian Wheat Board (to administer the sale of grain and
promote higher prices for wheat)
– The Natural Products Marketing Board (to allow marketing boards to
help farmers get higher prices for their products than the free market
could provide.)
Bennett proposed legislation to pave the way for unemployment insurance
and national health insurance, but these programs were thwarted by the
courts.
The Bank of Canada Act created a central bank to regulate credit and
currency in the best interest of the country. This government agency could
set more reasonable interest rates and increase the monetary supply in
order to stimulate the economy.
Many Canadians viewed Bennett’s adoption of the New Deal as a ploy
designed to save his highly unpopular government from defeat in the
upcoming election.
Woodsworth derided Bennett’s New Deal as a “deathbed conversion”
King Back in Office
• During the 1935 election campaign Bennett hoped his
New Deal would sway Canadians. Bennett attempted
to copy Roosevelt’s and Aberhart’s successes in using
the radio, but to no avail.
• King made few promises but did pledge to close down
the relief camps.
• King also ran on a campaign of “King or Chaos”,
criticizing Bennett for his heavy-handed repression of
the On-to-Ottawa Trek.
• The October results saw King’s Liberals grab 125 seats
in the House of Commons while Bennett’s Tories were
reduced to only 40 seats.
• Unfortunately, 5 years in opposition seemed not to
have changed King in the slightest.
King Back in Office
• King would say, “what is needed more than a change
in economic structure is a change of heart.”
• King promised to balance the budget and slash
government spending.
• He also kept his promise to close the relief camps,
but mostly because he viewed them as being too
expensive.
• King lowered the tariff and signed a trade deal with
the United States in an attempt to kick-start the
Canadian economy.
• King did adopt a few of Bennett’s New Deal policies,
but on a whole he moved slowly and cautiously.
• Canadians would have to wait another 5 years before
the effects of the Depression began to subside.
Depression-Era Culture in Canada
• Longshoremen by Miller Brittain
is a portrayal of unemployed
longshoremen in his home town
of Saint John, NB.
• There was unparalleled cultural
activity during the 1930’s.
• In the world of painting, the
Group of Seven had come
together and Emily Carr was
finding an audience for her
work.
• While the 1920s had seen
painters experimenting in
abstract works, the 1930s saw a
return to realism as artists
portrayed images of the
unemployed, foreclosed farms
and the helpless.
Depression-Era Culture in Canada
• Canadian novels in the 1930s were escapist – an
adventure, a historical romance, or a comedy. The
grief of the decade was too overwhelming to write
about.
• Canadians flocked to Hollywood movies and tuned
into their radios for American comedy and variety
shows such as Amos ‘n Andy.
• In the depths of the Depression, people wanted to be
entertained and a growing cultural influence came
from the USA.
• Foster Hewitt and “Hockey Night in Canada”
continued to be a favourite of Canadians
• The CBC, created in 1936, brought popular programs
such as “The Happy Gang” into people’s homes.