🇨🇦History of Canada – 1867 to Present Unit 7 – Canada's Great Depression: 1930s Impact

Economic Collapse and Causes

• Stock market crash of 1929 triggered a global economic downturn and led to the Great Depression in Canada
• Overproduction and underconsumption created an imbalance in the economy, leading to a decline in demand for goods and services
• Speculative investing and buying on margin contributed to the stock market bubble and subsequent crash
• Dependence on primary industries (agriculture, mining, forestry) made Canada vulnerable to price fluctuations and reduced global demand
• Drought conditions in the Prairies during the 1930s (Dust Bowl) exacerbated agricultural challenges and rural poverty
• Tight monetary policy and high interest rates implemented by the Bank of Canada limited access to credit and hindered economic recovery
• Collapse of international trade due to protectionist policies (Smoot-Hawley Tariff) and the gold standard further depressed the Canadian economy

Social Impact and Daily Life

• Widespread unemployment reached 25% at the height of the Depression, leading to poverty and hardship for many Canadians
• Breadlines, soup kitchens, and relief camps became common as people struggled to meet basic needs
• Transient populations, including unemployed men riding the rails, moved across the country in search of work and assistance
• Malnutrition and poor health outcomes increased, particularly among children and the elderly
• Family dynamics shifted as traditional gender roles were challenged, with women often taking on additional responsibilities to support their households
• Evictions and foreclosures became widespread, leading to homelessness and the growth of shantytowns (Hoovervilles)
• Education was impacted as many children were forced to leave school to support their families, leading to a generation with limited formal schooling

Political Response and Policy Changes

• Initial reluctance by the federal government to intervene, believing in the self-correcting nature of the economy and the temporary nature of the downturn
• Provincial and municipal governments struggled to provide adequate relief and support due to limited resources and jurisdiction
• Prime Minister R.B. Bennett's government implemented limited relief measures, including public works projects and direct assistance to the unemployed
• Bennett's "New Deal" policies in 1935 included social welfare reforms, but were seen as too little, too late by many Canadians
• The election of William Lyon Mackenzie King's Liberal government in 1935 brought a more interventionist approach to economic recovery and social support
• Establishment of the Bank of Canada in 1934 as a central banking system to regulate monetary policy and promote economic stability
• Gradual shift towards Keynesian economics and the belief in government intervention to stimulate demand and support social welfare

Regional Differences and Disparities

• The Prairies were particularly hard hit due to the combination of drought, falling agricultural prices, and limited industrial development
• Western Canada experienced significant population loss as people migrated to urban centers or left the region entirely in search of better prospects
• Central Canada (Ontario and Quebec) had a more diversified economy, but still experienced high levels of unemployment and industrial decline
• The Maritimes faced challenges related to declining resource industries and limited economic diversification
• British Columbia's economy, heavily dependent on natural resources and trade, was impacted by reduced global demand and falling prices
• Urban centers experienced higher levels of unemployment and social dislocation compared to rural areas
• Indigenous communities faced unique challenges, including limited access to relief programs and the ongoing impact of discriminatory policies

Cultural Shifts and Artistic Expressions

• The Great Depression influenced the development of Canadian literature, with writers such as Morley Callaghan and Sinclair Ross depicting the struggles of ordinary Canadians
• Social realism emerged as a dominant artistic style, with painters like Miller Brittain and Charles Comfort capturing the hardships and resilience of the era
• The Group of Seven continued to shape Canadian art, with a focus on the beauty and majesty of the natural landscape as a source of national identity
• The rise of radio broadcasting provided a new platform for entertainment, information, and cultural expression
• The Canadian Broadcasting Corporation (CBC) was established in 1936, playing a key role in shaping national culture and identity
• Popular music, including folk and country, reflected the experiences and emotions of the time, with artists like Wilf Carter and Hank Snow gaining prominence
• The Depression era saw the emergence of new forms of entertainment, such as board games and community events, as people sought low-cost ways to socialize and escape hardship

International Context and Comparisons

• The Great Depression was a global phenomenon, with countries around the world experiencing economic downturn and social upheaval
• Canada's experience was similar to that of other industrialized nations, particularly the United States and the United Kingdom
• The United States implemented the New Deal under President Franklin D. Roosevelt, which served as a model for some of Canada's policy responses
• Germany's economic crisis and the rise of fascism under Adolf Hitler served as a cautionary tale and influenced Canadian political discourse
• The Soviet Union's centrally planned economy and the apparent success of its industrialization drive attracted some Canadians seeking alternatives to capitalism
• Canada's position as a middle power and its close ties to the British Empire shaped its international relations and economic policies during the Depression
• The League of Nations, established after World War I, proved ineffective in addressing the global economic crisis and maintaining international stability

Recovery Efforts and New Deal Policies

• The election of Mackenzie King's Liberal government in 1935 brought a more proactive approach to economic recovery and social welfare
• The National Employment Commission was established to coordinate relief efforts and provide work for the unemployed through public works projects
• The Canadian Wheat Board was created to stabilize agricultural prices and support Prairie farmers
• The Bank of Canada, established in 1934, played a key role in regulating monetary policy and promoting economic stability
• The 1937 National Housing Act provided funding for the construction of low-cost housing and helped stimulate the construction industry
• The 1940 Unemployment Insurance Act introduced a national system of unemployment benefits, providing a safety net for workers
• The outbreak of World War II in 1939 led to increased government spending, industrial expansion, and a reduction in unemployment, effectively ending the Depression in Canada

Long-Term Consequences and Legacy

• The Great Depression led to a fundamental shift in the role of government in the economy and society, with a greater emphasis on social welfare and economic intervention
• The experience of the Depression shaped the political attitudes and voting patterns of a generation, leading to the rise of the welfare state and the popularity of left-leaning parties
• The economic challenges of the 1930s contributed to the rise of regional political movements, such as Social Credit in Alberta and the Cooperative Commonwealth Federation (CCF) in Saskatchewan
• The Depression exposed the vulnerability of Canada's resource-based economy and highlighted the need for greater diversification and industrialization
• The legacy of the Depression can be seen in the development of social programs, such as universal healthcare and old-age pensions, which emerged in the post-war period
• The cultural and artistic expressions of the Depression era, including literature, art, and music, continue to shape Canadian identity and historical memory
• The lessons of the Great Depression informed economic policy and crisis response in the decades that followed, including during the 2008 global financial crisis