2D-4.2 The Economic Boom of the 1920’s
Economic Development:
¾ Wheat on the Prairies:
- The Prairie provinces enjoyed huge wheat crops from 1925 to 1928.
Europe was hungry again for Canadian wheat as economies began to
recover, and the world price of wheat moved steadily upward. Farmers
began to buy trucks and mechanical harvesters. They replaced their
horses with tractors.
- Some farmers organized wheat pools and cooperatives. These
cooperatives were businesses owned by farmers. Their goal was to loan
money to farmers at lower interest rates than eastern Canadian bankers
charged. By 1928, Canada had a record wheat crop and a major share of
the world wheat market. Grain elevators were filled to the top, and prices
of wheat remained at an all-time high through the first half of 1929.
¾ Pulp and Paper:
- In the 1920s, the production of newsprint became Canada’s largest
industry after agriculture. From Nova Scotia to British Columbia, vast
forests of soft woods such as spruce, pine, and poplar were used to make
newsprint. Most of the American sources of pulpwood were in decline,
thus giant American newspapers provided a ready market for Canadian
pulpwood. By 1929, exports of Canadian pulpwood equalled total pulp
exports from the rest of the world. So much newsprint was shipped
across the border that the Canadian government finally had to urge
Canadian producers to save some of the supply for Canadian newspapers.
- This boom did have a negative side. Canada’s forests were being
destroyed. Canada’s economy was also becoming increasingly dependent on
the export of raw materials. Thousands of Canadian workers were
following the materials to the United States and finding jobs in American
industries.
¾ Hydroelectric Power
- Quebec and Ontario saw a dramatic increase in the production of
hydroelectric power in the 1920s. Niagara Falls had been used for power
since 1895. Rivers such as the Saguenay and the St. Maurice were
developed as resources for water power in the 1920s. More industries
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were using hydroelectric power instead of coal. People were demanding
electricity for their homes, especially as new electrical appliances became
available. Canada’s output of hydroelectric power became the second
largest in the world.
¾ Oil and Gas
- The 1920s were often referred to as the “Oil Age.” As more Canadians
took to the road in automobiles, the demand for gasoline and oils soared.
Oil and gas were also being used for heating and cooking. In October
1924, oil speculators struck in Alberta struck it rich. The well they were
drilling in the Turner Valley south of Calgary yielded one million barrels
of oil and large quantities of natural gas.
¾ Mining
- Exciting new mining discoveries were made in the 1920s. Large deposits
of copper were found in the Canadian Shield near Noranda along the
Ontario-Quebec border and at Flin Flon in Northern Manitoba. At
Sudbury, Ontario, by 1929 Canada was producing almost 80 percent of
the world’s supply of nickel. Mines in British Columbia produced lead and
zinc in large amounts as well.
¾ Foreign Investment
- After World War I, American foreign investment in Canada increased.
American business interests sought to invest money into the rapidly
growing sectors of Canada’s economy, including mining, pulp and paper and
hydroelectric power. These American investors introduced a branch plant
system, in which an American parent company produced the same
products in the United States, however a Canadian branch plant was able
to produce the same products with a “made in Canada” label. This system
yielded American profits and management, but employment and tax
revenue for Canadians.
Technology:
After the horrors of war, many Canadians were eager to add joy and
simplicity to their lives. Advances in technology appealed not only to the
wealthy, but the middle class as well. Key technological developments
greatly impacted Canadian society as a whole.
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¾ Radio
- The radio was the great communication invention of the 1920s. Voices,
news and music could now be broadcast across the country using radio
signals. The radio helped to shrink Canada’s vast size. People living in
isolated rural sections of the country were brought into contact with the
cities of the nation. The earliest home radio sets did not have tubes, but
rather used a crystal (thin piece of quartz). Listeners tuned in a signal by
moving a fine wire “whisker” over the surface of the crystal. Sounds from
crystal radios were never very loud, so earphones were often needed
Several pairs of earphones were provided when neighbours came to visit
and “listen in.” A person could take a crystal set on a picnic, hang the
antenna on a tree, and sit back and listen through the earphones.
- Before long, improved and expensive radio sets appeared in stores.
These were built in elaborate wood cabinets. Tubes replaced the crystal
and whisker and speakers replaced earphones. The radios operated by
large batteries that had to be recharged frequently. In 1925, a young
Canadian inventor, Edward (Ted ) Rogers, discovered a way of plugging
the radio directly into household electrical current. His invention was the
world’s first battery-less radio. It sold for approximately $150.00.
- In February 1927, Ted Rogers set up his own radio station in Toronto.
His station’s call letters CFRB continue today to stand for his invention (R
for Rogers and B for Battery-less). By 1929, there were 85 small
broadcasting stations in Canada. People could tune in to hear the latest
news, weather, music, drama programs, sports broadcasts, comedies and
entertainment shows. The vast majority of programs however, came from
the United States.
¾ Automobiles
- The 1920s also saw the growth of the automobile industry. Henry Ford
dreamed of making an inexpensive car that almost anyone could afford to
buy. Ford decided to apply to car manufacturing a method of mass
production. He set up an assembly line that ran from one end of the
building to another. At one end of the line were the frames of the cars.
As the line moved, new parts were added to the frame by workers who
remained in one place. By the time a car reached the end of the line, it
had been assembled and was ready to be driven.
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- The automobile put North Americans on wheels. On Sunday, a family
with a car could call on relatives several kilometres away and still be home
in time for supper. Farm families could travel to nearby towns and cities
for a day’s shopping, while farm children could get to school easier. For
many, the car also became a status symbol. Movie idols of the 1920s all
drove cars and reinforced the image that cars represented freedom and
glamour. Cars also gave a new sense of individualism. They were much
more private than riding on a train, streetcar or bus. By 1929, only the
United States had more cars per person than Canada.
¾ Aviation
- Following the use of airplanes in World War I, advancements in aviation
continued throughout the 1920s. Gradually the public and the government
began to see the possibilities of passenger air travel. By 1927, small
carrier planes were flying people from city to city, but there was no
national air service. In the same year, a young American pilot, Charles
Lindbergh, completed the first non-stop flight transatlantic flight from
New York to Paris. This important event demonstrated the possibility of
long-range air travel. Eventually, in 1937, the Canadian Minister of
Transport, C.D. Howe, decided to create an airline owned by the Canadian
government. He formed Trans-Canada Airlines, which became Air Canada
in 1964.
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