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 Canadas 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 couldnt afford high
interest rates, yet theirs were the countrys 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
non-existing 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 Canadas 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 Kings 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 didnt 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
Bennetts problem to solve.
There was no way that someone with Bennetts 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 lifes
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.
Bennetts 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.
Bennetts 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.
Bennetts 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 Bennett
buggy.

Relief Camps and the On-to-Ottawa Trek

One of Bennetts 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 antired hysteria of the time.
Bennetts handling of the On-to-Ottawa 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 womens
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 CCFs 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 CCFs 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
scandal-ridden nature of the John
Brownlee administration. Aberhart
won a landslide victory to become
Albertas 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.

Bennetts 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 quickly brought in one of the most far-reaching reform
packages in Canadian governmental history.

Bennetts New Deal

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 Bennetts adoption of the New Deal as a ploy
designed to save his highly unpopular government from defeat in the
upcoming election.
Woodsworth derided Bennetts 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 Roosevelts and Aberharts 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 Kings Liberals grab 125 seats
in the House of Commons while Bennetts 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 Bennetts 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 1930s.
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 peoples homes.