The Great Depression was a terrible point in Canadian history, and for most of the world. It was a point in time where thousands of people lost their jobs, and even lost their homes because of the depressed economy. Business was booming in the early 1920s, but when companies tried to expand, and therefore issued stocks, the economy was thrown off. Some investors sold their stocks for high prices, and as a result, everyone else followed. With less of a demand, stock prices became fractions of what they used to be, and on October 29, 1929, the New York Stock Exchange collapsed, followed by the Toronto and Montreal Stock exchanges. This collapse of the stock markets caused a depression like which the world had never seen before. It was important for governments to find methods to deal with the depression, but the Canadian government wasn't very successful in its attempts to deal with the Great Depression.
A depression is defined as a long period of severe economic and social hardship, massive unemployment, and suffering. This particular depression around the 1930s was a GREAT depression. There was drought on the prairies which lessened already cheap harvests, only 300000 of 11000000 Canadians actually earned enough money to pay income tax, and over 25% of Canada's workforce was unemployed. A small minority actually made a lot of money during the depression, but the majority were suffering harshly.i A depression this caliber had never even been heard of before.
The prime minister at that time, Mackenzie King, was unprepared to deal with the crisis at hand. His thoughts were that the depression was only a fluke, and that given time, the economy would prosper once more. King never answered the pleas for aid by his citizens, and told the people that the depression was the responsibility of municipal and provincial governments. However, the depression bankrupted many municipalities. Even still, he even went as far as saying that he would not give "a five-cent piece" to a Conservative provincial government. This quote was ultimately the reason why King lost power in the 1930 election to Richard Bennett and his Conservatives.i
Prime minister Bennett also was not in favour of government intervention, but he did however create several acts to help Canadians through the Depression. The conservatives introduced the unemployment relief act, giving the provinces $20 million for work-creation programs. This, however, did not aid economy much. Also, Bennett tried to raise tariffs in order to protect Canadian industries and get into the world market. He raised the tariffs by an average of more than 50 percent, which did protect some businesses, but it actually caused more harm than good. These tariffs made other nations set up trade barriers against Canada. He introduced the Prairie Farm Rehabilitation Act in 1935, which helped farmers build irrigation systems and reservoirs, but by this time, because of drought, poverty, and locusts, most families had already...