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Chapter 4:

Chapter 4:. The Dirty Thirties (the Great Depression). Stock Market Crash. The North American Economy was booming from the latter half of the 1920s until… Tuesday, October 29, 1929 when the NY Stock Exchange collapsed. Causes of the Great Depression.

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Chapter 4:

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  1. Chapter 4: The Dirty Thirties (the Great Depression)

  2. Stock Market Crash • The North American Economy was booming from the latter half of the 1920s until… • Tuesday, October 29, 1929 when the NY Stock Exchange collapsed.

  3. Causes of the Great Depression (Write several notes on each point from your text) • Overproduction • Canada’s Reliance on Exporting Staple Products • Canada’s Dependence on the U.S. • The Stock Market Crash • Economic Protectionism and Tariffs • International Debt After the First World War

  4. Overproduction • More goods were being produced than were being sold. • At first, manufacturers continued to stockpile goods, then began cutting back on production. • This decrease in production led to layoffs in factories, which meant less income for families, and less spending on goods.

  5. Canada’s Reliance on Exporting Staple Products • Major weakness for Canada • Two primary resources exported: wheat from the prairies and newsprint from BC, Ont, Qbc. • Canada supplied 40% of the world demand for wheat and 65% of the demand for newsprint. • As international markets reduced their demand for products people lost jobs.

  6. Canada’s Dependence on the U.S. • Canada was hit hard because of its close ties to the US economy. • US had become Canada’s biggest trading partner and largest investor. • When the US econ crashed Canada’s econ felt the effects.

  7. The Stock Market Crash • In the 1920s investors were buying stocks ‘on margin’ to cash in on the high profits of the stock market. • ‘on margin’ (loans) – buying shares with only a 10% down payment, assuming that as the stock prices kept rising the other 90% would be paid with the profits. • The rush to get rich quickly drove the price of stocks up beyond their real value. • When cautious investors started selling their stocks in order to cash in on high profits, other followed their lead causing the value to drop.

  8. Economic Protectionism and Tariffs • US imposed high tariffs (taxes) on foreign goods coming into their country. • The tariffs were meant to protect the US domestic market by making foreign goods more expensive. • This had harmful effects, as other countries imposed their own tariffs in response to the US. • Tariffs caused a slowdown in world trade as opportunities for export shrank.

  9. International Debt After the First World War • Germany could not pay back its debt after the Treaty of Versailles because its econ was in ruins. • The huge payments it had to make to Great Britain and France to compensate for war damages stunted its recovery effort. • France & Great Britain counted on the reparations to pay back their own war debts owed to the US, which they were demanding.

  10. Desperate Years • Some wealthy and middle-class Cdns with secure jobs noticed little change, but many lost factory jobs. • Thousands survived on “pogey” – gov’t relief payments given to those who had not income. • But, not easy to receive, people had to swear that they didn’t own anything in value and were evicted from their home. • Successful applicants received vouchers to buy food, but were not enough and humiliating.

  11. Private charities provided used clothing and meals. • Soup kitchens were set up to feed homeless. • By winter of 1933 more than one-quarter of the workforce was unemployed. • Young men hopped freight trains from town to town looking for work – “riding the rods” • Women were criticized for taking jobs. • Aboriginal families received $5 a month and were expected to “live off the land”. • Chinese and Jewish people were viewed with hostility and were discriminated against.

  12. Responding to the Depression • Liberal PM Mackenzie King was unprepared to deal with the crisis, believed it was temporary, and told Cdns financial help was the responsibility of the provincial gov’ts. • Final straw – told parliament he wouldn’t contribute ‘a five-cent piece’ to a Tory provincial gov’t. – cost him the 1930 election.

  13. Conservative PM R.B. Bennett – no more in favour of relief. • Gave $20 million to provinces for work creation programs, but the econ did not improve. • He raised tariffs by 50% to protect Canadian industries. It did more harm than good, as nations started trade barriers against Canada. • New lingo: Bennett Barnyard (deserted farm), Bennett Blanket (newspaper), Bennett Coffee (roasted wheat), Eggs Bennett (boiled chestnuts). • Work camps esta to get unemployed out of the cities for 20 cents a day.

  14. On-to-Ottawa Trek • In 1935, over a thousand men left the camps in BC for Ottawa to protest camp conditions. • Men crowded into and on top of freight cars picking supporters along the way. • The RCMP stopped them in Regina. Bennett met with the leaders, but name-calling ensued. • Protesters were confined into a local stadium and when the RCMP were told to clear them out a riot began – 1 killed, many injured, 130 jailed.

  15. PM R.B. Bennett • The failure of the "On to Ottawa" Trek was a tough blow for the career of Prime Minister Bennett, who was widely criticized for his handling of the situation.

  16. Read p. 84-85 • Looks at the difference between US and Canadian gov’t involvement during the Depression. • Roosevelt’s “New Deal” • John Maynard Keynes - economist • Answer Questions #1 – 4

  17. Politics of Protest • Cdns looked to alternative parties for solutions to the Depression:

  18. Provincial Solutions • Voters dissatisfied with inaction voted out ruling provincial parties:

  19. Distractions From Despair • From 1920 movies, radio, and magazines became a staple in the lives of Cdns. • Even with the problems of the Depression, entertainment remained enormously popular. • US radio – “The Lone Ranger” and big bands. • CBC was created in 1936 to win over Cdn listeners. • Dionne Quintuplets • Grey Owl

  20. Chap 3 &4 Review • Adjustment of Soldiers returning from war • Winnipeg General Strike • Regionalism – protest from provinces • Progressive party • Cdn’s growing independence • Booming Economy • Role of Women – the Persons Case • Causes of Depression • Responses – US and Cdn

  21. On-to-Ottawa Trek • New parties • Provincial solutions • Distractions

  22. P. 86#1-4 • P.90 #1-3 • Chapter Reviews for Chap 3 + 4 • Chapter 3 Activity Sheets: Vocabulary words and people.

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