the dirty thirties. economic basics 1.prosperity 2.recession 3.recovery depression is prolonged...

The Dirty Thirties

Economic Basics

1. Prosperity2. Recession3. Recovery

• Depression is prolonged recession where deflation takes place

The Great Depression

• Black Tuesday – October 29th 1929 stock

market crashed– Speculators “buy on

margin” borrowed money to invest

– People could not pay off the interest or principle on their loans

– Banks could not pay their members both go bankrupt

• Fall of stock market caused people to save money rather then invest or buy goods

• This resulted in more people being laid off

• Depression hits Canada hard 33% of goods sold to foreign markets. Deflation resultsIncome per year 1928 1933

BC $594 $314Sask $478 $135

Unemployment 2.6% 26.6%

Agriculture• 1/3 Canada’s economy form

farming

• Disaster strikes– Over farming– Drought and heat wave

• Dust bowl– Grass hopper infestation– Wheat worms– Production

• 1928 1614 bushels of grain• 1933 66

bushels of grain

Causes of the Recession / Depression

a. Over productionb. Dependency on USAc. Protectionist

legislation (Tariffs)d. War debtse. Government policies

or lack off. TechnologySmall business the big

looser.

Depression in Canada• Wages fell faster than the

price of goods making life difficult on the poor.

• 1/3 of Canadians suffered from the depression.

• King’s response as depression hits was the belief that it was temporary

• King did not support conservative provinces “ I wouldn’t contribute a 5 cent piece to any Tory provincial government” king lost the 1930 election to Bennett.

Bennett and the depression• Bennett introduced

– $20 million in work creation projects

– Raised tariffs by 50% to protect Canadian business.

– Set up relief camps• As depression continued

people became angry with Bennett. – Bennett buggy, Bennett

blanket, Bennett barnyard, Eggs Bennett

• Riding the Rails– Hitch free ride on top of

freight cars or inside if possible drifting from city to city looking for work.

– Then because nothing else to do

• Pogey / Dole– Precursor of modern welfare

system where people got vouchers to exchange for food or essential goods.

• Unemployment relief camps– $0.20 a day plus room and

board– Set in remote locations

(public works or logging)– Poor conditions

• Bennett’s New Deal (1935)• Progressive taxation• Maximum work week• Introduction of minimum wage• Stronger regulations on working

conditions• Unemployment insurance• Health and accident insurance• Agricultural support• Revised old age pension• Canadian wheat board

• On to Ottawa trek (June 1935)– Frustrated relief camp workers

boarded trains bound for Ottawa to protest their working conditions.

– The trains reached Regina where a riot broke out as the RCMP tried to disband the strikers beating one to death

– A leader did talk to Bennett but Bennett soon lost the 1935 election

• Diversion– CRBC (CBC) 1932 (1936)

public radio hour in Canada

– Dionne quintuplets• Children watched as they

grew• Generated $ 500 million

per year

• Bennett (left Canada shortly after never to return)– We later found that

Bennett gave money of his own to help those who wrote him.

Politics of DepressionWhen the status quo fails people turn to other for hope• Social Credit

– Led by William Aberhart (bible bill)– Believed that giving each citizen

$25 per month would end depression

– Popular in BC an Alberta• Cooperative commonwealth

federation (CCF)– Now the NDP used the 1933

Regina manifesto to put forth their idea that there should be public ownership of banks and major services as well as improving health and social services

– Believed in increasing tax for wealthy.

– Led by JS Woodsworth

Le Chef• Union Nationale

– Political protest party in Quebec that developed during the depression

– Opposed English interference in Quebec

• Maurice Duplessis– Padlock laws (1937) passed

to restrict communism suspending many rights of workers / unions (20yrs)

– Prevented radical political opposition

• Duplessis ruled like a dictator giving him the nick name Le Chef.– He refused federal

government support causing health and social services to fall way behind rest of Canada.

– The period was know as la grande noirceur “the great darkness” • Orphanages run buy church,

babies kidnapped or forced addoption from unwed mothers (classed as mentally challenged to get federal $)

– Business flourished in the anti union Quebec allowing Duplessis to build new roads and infrastructure.

Rowell-Sirois Commission• Federal - provincial

economic and financial relationship. – Recommended feds take over

• Provincial debt• Responsibility for

unemployment• Provinces forfit federal

subsidies & right to collect certain tax

• Transfer payments (grants for poorer provinces.

• As war was under way kings government passed laws under war measures ignoring the opposition of Ontario, BC and Alberta.

• This has enable the federal government to take money from wealthy provinces to pay for programs in poorer ones. As well the federal government now can withhold transfers unless the provinces do as asked.

International polution • Trail Smelter

– Produced thick yellow sulphur laced smoke killing plants

– Prevailing winds took smoke down columbia valley in to USA killing many crops

– International joint commission ruled Canada must limit pollution and pay $78000

– Set precedent for future rulings. First major environmental protection legislation.

Canadian Fight Fascism in Spain• In 1936 General Franco with

support of Germany and Italy implemented a military coup.

• Canadian were divided as Catholics felt Franco protected against communism while other felt it was anti democratic

• King fearing disunity passed non intervention policy making it illegal for Canadians to join a foreign army

• 1250 Canadian did go and fight for democracy under the Mackenzie Papineau battalion (Mac-Paps) 600 men died

• Norman Bethune best known volunteer as he was a doctor from Montreal and pioneered mobile blood transfusions which saved many lives

• He later joined Mao Zedong’s army fighting the Japanese. He was awarded hero status in China.