Responses to the

Depression

Background Causes of Great Depression

• Similar to WWI, there were BACKGROUND CAUSES to the Depression:

1) Overexpansion & overproduction

2) Canada’s Dependence on Staples (wheat)

3) Canada’s Dependence on United States

4) High Taxes decreased International Trade

5) Credit Buying

6) Buying on Margin

Political Responses• P.M. Mackenzie King

• Five Cent Speech 1930

• re-elected 1935

• P.M. R.B. Bennett

• elected 1930

• proposed the New Deal

• New Political Parties

• emerged to solve the problems of the 1930s

• Social Credit- leader William Aberhart

• Union Nationale- leader Maurice Duplessis

• Co-operative Commonwealth Federation (CCF)- leader J.S. Woodsworth

Social Issues•Aboriginal Issues

• Policy of assimilation seen in the Indian Act 1867, creation of residential schools, and policy of enfranchisement (right to vote if give up Aboriginal status)

• League of Indians- created in 1919 by Frederick Loft (Aboriginal war veteran) to make a united voice for Aboriginals

• Immigration

• Xenophobia- intense dislike of foreigners

• 1919 Immigration Act- made all immigrants pass an English literacy test (emphasis on assimilation)

• 1923- Chinese Exclusion Act: banned all Chinese immigrants except students, merchants and diplomats (from 1923- 1947- only 8 Chinese immigrants admitted to Canada)

The Traditional Approach•The traditional federal parties

believed, as did many economists, that a balanced budget, a sound dollar, and support of the tariff system would eventually help the economy right itself.

•But the millions who lost their jobs in the Depression did not embrace this ‘hands off' approach. People demanded action.

The Prairies• In the Prairies, the

situation was even worse. A dearth of rainfall that had begun in 1927 became a full-fledged drought in 1929. Then, with the crash of the market, wheat prices fell. As the drought became more severe, farmers had no resources to help them through.

Social Responses• Provincial income in Saskatchewan dropped by

almost 90% in the first few years of the Depression and almost

• 70% of the rural population was forced to accept relief. The situation was similar in many of the other Prairie provinces.

• The Depression, although still devastating, did not hit Ontario and Quebec quite as hard because of their large, diversified industrial bases.

• With prices sinking, land owners and those lucky enough to keep their jobs actually saw their standard of living improve.

• The unemployed, the self-employed, farmers, youth, and small business owners suffered immensely.

• Private individuals helped out when they could and church groups and others organized soup kitchens to help feed those in need.

Financial Aid• Financial Aid was not equal across the nation.

• An out-of-work family in Calgary could receive up to $60 per month while a similar family in Halifax would receive only $19 per month.

• Many municipalities struggled with supporting those in need and they simply refused to help able-bodied young men. 

• Birth rates and immigration both dropped significantly during the Depression. Roughly 167,000 immigrants entered Canada in 1929 but that number had dropped to less than 12,000 in 1935.

Unemployment Camp• The federal government created

Unemployment Relief Camps where out-of- work young men were paid 20c/day to do construction work.

• Conditions in the camps were not ideal and there were several protests held, the most violent of which was the Regina Riot in 1935. By 1936, the camps had been shut down.

The Traditional Approach•The traditional federal parties

believed, as did many economists, that a balanced budget, a sound dollar, and support of the tariff system would eventually help the economy right itself.

•But the millions who lost their jobs in the Depression did not embrace this ‘hands off' approach. People demanded action.

R.B. Bennett and the Conservative Party

•1930 - The Tariff Approach

•Prime Minister Bennett promised to fix the economy by raising tariffs in order to protect Canadian manufacturing and preserve Canadian jobs.

•Unfortunately, other countries suffering the same economic difficulties simply raised their own tariffs on Canadian imports.

R.B Bennett

1935 - A New Deal• 1935: The tariff approach wasn't working.

• PM Bennett decided to offer Canadians a new deal modelled on the one that Franklin D. Roosevelt offered Americans. This new deal involved changes to the taxation system, a minimum wage, closer regulation of working conditions, unemployment insurance, health and accident insurance, a revised old-age pension, and agricultural support programs.

• But it was too little, too late for Canadians who failed to return the Conservatives to power in 1935 and instead went back to Mackenzie King.

WLM King and the Liberal Response• 1929 - The Hands Off Approach

• Liberals decided to wait and see during the Depression.

• Believed Depression would soon be over and people simply had to hang on.

• Unfortunately for King, the people weren't willing to wait and see and voted the Liberals out in 1930.

• 1935 - King or Chaos? Despite his election slogan, King offered few alternatives to Bennett's New Deal.

• Once returned to power, he negotiated trade agreements with the U.S. and Britain but offered no new relief to out-of-work Canadians or struggling industry.

• His attention was also drawn to global concerns as it became increasingly clear that the policy of appeasement being applied to Germany's socialist leader were not going to be successful.

William Lyon Mackenzie King

New Parties, New Ideas• The CCF (Leader: J.S. Woodsworth)

• Formed in 1933. Group of social activists, academics, farmers, and labour unions

• Party pursued an agenda that involved a social welfare system including pensions, health and welfare insurance, unemployment insurance, a family allowance, and workers' compensation.

• In 1961, members of the CFF and the Canadian Labour Congress combined forces to create the New Democratic Party.

• While neither the CCF nor the NDP has ever held power federally, both parties have had a tremendous impact on Canada's social identity.

J.S Woodsworth

Social Credit• Social Credit argued that an inefficient system created a society that

lacked the purchasing power to enjoy the fruits of their capitalist endeavours and resulted in a stalled economy.

• Created by British Major C.H. Douglas, advocated giving people money in the form of a social credit so that they would buy goods and further stimulate the economy.

• Alberta preacher by the name of William “Bible Bill” Aberhart wholeheartedly embraced it. He used his radio program to support the idea of a public social credit system to help rescue Canada from the Depression.

• In 1935, he led the newly formed Social Credit party to victory in Alberta, winning 53 of the available 63 seats with a promise to give every Albertan $25 per month to spend. Although elected, Aberhart was never able to put his idea into practice as the Federal government was solely responsible for the printing and distribution of money.

• The Social Credit Party won nine elections in Alberta and enjoyed success in other western provinces and in Quebec.

Bill Aberhart

The Union Nationale• Led by Maurice Duplessis

• The Union Nationale: born in the Great Depression.

• Handily won the election of 1936.

• Blamed the federal government for Quebec's economic woes

• During the Second World War, the Union Nationale developed a nationalist approach, accusing the government of betraying Quebec's interests and infringing upon the province's rights.

Maurice Duplessis

What brought the world out of the Great Depression?

• World War II breaks out September 3, 1939

• Canada declares war on Germany September 10, 1939

• HOW?HOW? war industries re-open

• rise in employment

• as more people get jobs,people have $ to spend

• businesses revived