THE GREAT DEPRESSION 1929 - 1939

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THE GREAT DEPRESSION1929 - 1939

• An Introduction

How do we go from this to this?
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From Boom to BustThe Great Depression
1929-1939 Dirty Thirties

• The Trigger October 29th, 1929 - the good times
  of the 1920s abruptly came to an end when the New
  York Stock Market crashed, followed by stock
  crash in Toronto. This day in 1929 was called
  Black Tuesday (the stock crash was a symptom of
  other economic problems)
• The 1930s depression became a time of despair
  for many Canadians as they lost their savings,
  their jobs, their automobiles and their homes.
• The Great Depression was the longest in human
  history (10 years) and affected Canada and the
  rest of the world!

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• WHAT TRIGGERED THE GREAT DEPRESSION?
• The 1929 Stock Market crash was a CONSEQUENCE of
  deeper economic spending problems from the 1920s
  party era that triggered the 1930s Depression.
• The stock market crashed when people banks
  rushed to sell their stocks at once. Prices and
  values dropped, profits fell, and investors lost
  30billion in total.
• Those who bought on credit could not repay debts.
• 1 out of 5 people would be unemployed during the
  1930s depression.

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What caused the 1930 Great Depression that lasted
10 years?
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Lets play the blame game

• Task
• You will be placed in a group playing the part of
  overpaid defense lawyers. You must represent your
  client by BLAMING the other party for causing the
  Great Depression.
• Identify at least 3 reasons to blame the other
  group and be sure to explain the significance
  of how each problem they created resulted in a
  personal/societal/economic/or polital consequence
  for individuals or Canada as a whole.
• The government banks
• OR
• 2) Canadian citizens and prairie farmers

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WHAT WERE THE 5 MAIN CAUSES OF THE GREAT
DEPRESSION IN CANADA?
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• REASON 1 Irresponsible spending and limited
  government regulation during the 1920s paved the
  way to the Stock market crash of 1929 The Great
  Depression in the 1930s
• Canadians were going into debt by the late 20s
  without realizing it when times were good and
  living beyond their means.
• Buying stocks on the margin (10 of price
  risky if it dropped, as they were then
  responsible for paying the whole price at once).
• Buying goods on credit and living beyond their
  means (what they could realistically pay for at
  the time of purchase). Farmers and businesses
  borrowed money from banks to pay for equipment
  and labour (loans the couldnt repay after the
  stock market crash of 1929).
• Consequence Resulted in major debt for the
  country, banks, individuals and economic crisis.
  Businesses shut down people lost savings
  jobs!

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• Basically, the stock market crash of 1929 was due
  to
• Irresponsible spending
• People bought stocks with credit during the 20s,
  which allowed them to easily invest in the stock
  market (purchasing margin shares for 10 of the
  entire price of the stock was risky if stock goes
  down).
• Limited government regulation, laissez-fair
  approach enabled people to buy/sell easily
  without thinking of whether they could afford
  their purchases.

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• Limited regulation enabled people to use credit
  to live beyond their means, take out loans, spend
  unwisely, and accumulate large debts.

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• REASON 2. Businesses were producing more goods
  than they could actually sell.
• Industries in the 1920s were expanding (with the
  change from a war based industry to a consumer
  based industry building cars and small
  appliances instead of guns).
• Profits were spent on adding to factories or
  building new ones during prosperity.
• HOWEVER, this MASS PRODUCTION of consumer
  products (like cars, consumer goods, etc)
  resulted in a huge stockpile supply of goods that
  couldnt all be sold by the late 20s.
• In other words, there was an over-supply of
  products with not enough demand for them
  (consumers were not buying enough of what was
  being made and sold by companies).
•  
•  
•  

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• REASON 3. Canada was too dependent on exports of
  natural resources (selling to other countries).
  Overproduction of raw materials and the limited
  demand for products became a big problem!
• With the prosperous 1920s, Europe was starting
  to recover after WWI and make their own consumer
  goods like Canada.
• They no longer needed Canada to export products
  like wheat, paper, fish, coal or consumer
  products (this added to the oversupply build-up
  problem of consumer products in the late 20s and
  little demand or need for all those products that
  were manufactured in bulk) leading to the 1930
  depression/debt/poverty.

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REASON 4. Canadas economy was also too dependent
on the USA. In the 1920s, almost 40 of Canadian
exports were sold to the States, along with
investments. When the US economy failed with
the Stock Market Crash of 1929, Canadas stock
market followed with devastating consequences,
leading to mass poverty and unemployment. Protect
ionism tarrifs made this problem worse 1920s
tariffs (duties or taxes on imported goods coming
into a country) hurt Canadian profits when
exporting/selling to other countries. US
protectionist taxes really hurt Canadian business
profits when exporting/selling to the States.  
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• REASON 5. The Dust Bowl HIT HARD
• Wheat prices hit rock bottom without having
  anyone to export to. Farmers lost their business
  in the prairies. Land was also destroyed by over
  ploughing in the 20s during prosperity.
• To make matters worse, farmers took a hard hit
  with the Dust Bowl (severe drought hit farms).
• Farmers abandoned their farms and hopped on
  trains illegally to hitch a ride for work
  elsewhere.

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The effects of the depression were made worse by
the Dust Bowl
Decades of over-farming and droughts in the
Plains led to windstorms that swept away soil and
made farming impossible
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• CONSEQUENCES!!!!

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Major Consequences

• Consequence Resulted in major debt for the
  country, banks and businesses closed, individuals
  and the economy were in major economic
  /emotional/social crisis.
• Businesses shut down people lost savings
  jobs!
• Massive unemployment throughout the 1930s (about
  25-30 of the population were unemployed)
• People were afraid to buy anything (hurt economy
  and business)

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• How you viewed the Great Depression depended on
  your age and what happened to you.
• Children
• Never really saw this era as a miserable time
• Families have a lot of time for each other
• For entertainment, there were parlor games, the
  piano, church community, radio
• Food may have been poor, but there was plenty of
  appetite
• Adults
• Many were unable to find a job or pay the rent
• Once your savings were gone, there was nothing
  else
• Fishermen couldn't sell their fish (nobody had
  money to purchase it)
• Farmers watched the soil blow away as dust
• Young men were often the most disadvantaged

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Farmers often faired better than the urban
dwellers because they could eat what they managed
to grow (unless the dust bowl directly affected
their crops out west in Canada along the
prairies). -For the farmers who managed, many
were already poor, so they could cope with more
poverty. Store owners sometimes extended credit
knowing that they may never be paid. Teachers
watched out for (and often fed) students who came
to school hungry. Religious institutions played
a major role by -Offering stability and comfort
to families -Providing counseling for those who
were overwhelmed -Shipping clothes and food to
the prairies during the Dust Bowl
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Soup Kitchens and Breadlines food stamps and
work camps
Rudy Vallee Brother Can You Spare a Dime? Song
plays for next 4 slides
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(No Transcript)
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Mortgage Foreclosures
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Poverty in America
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(No Transcript)
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In your own words, define the following terms
Stock Market Crash Easy Credit Lack of
Financial Regulation Shrinking Demand Economic
Ties Protective Tariffs (hint see pages 82-83
in your textbook)
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This is a Bennett Buggy a car with the engine
and windows removed and pulled by a horse.
Nicknamed after 1930s Prime Minister Richard
Bennett (blamed for not fixing the Canadas
poverty state).
This is an image of men riding the rods. Why
would men do something so dangerous?
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Now it is your turn to DIG deeper. Describe,
infer, and generalize both of these images. What
do they tell you about life during the Great
Depression?
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What Were the Long-term Effects of the Great
Depression?

• The Great Depression profoundly affected the
  world economy, especially in Europe, where many
  countries had not fully recovered from the
  aftermath of World War One In Germany, the
  economic disaster and resulting social
  dislocation contributed to the rise of Adolf
  Hitler.
• -We will discuss this further in the following
  weeks

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What Were the Long-term Effects of the Great
Depressioncontinued

• Not everyone suffered (rich corporations fired
  people and cut costs to keep their wealth. People
  who were already rich managed just fine with the
  cheap prices at stores).
• Yet it is generally agreed that complete business
  recovery was not achieved and unemployment ended
  until the government began to spend heavily for
  defense during World War Two.

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• Homework Questions
• 80-81, 86-89
• Consider
• How did Bennett respond to the Great Depression?
  
• Read pages 80-81 in your textbook. Do you think
  it was fair to blame Bennett for the long-term
  effects of the Great Depression?
• How did the Great Depression affect the following
  groups of people Women, Aboriginal and First
  Nations, Inuit Communities?
• What was Bennetts New Deal? Why was it
  significant?

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Canada and the Great Depressioncontinued

• For all the unemployed there was a relief program
  for families and all unemployed single men were
  sent packing by relief officers by boxcar to
  British Columbia. There were also work camps
  established for single men by Prime Minister
  Bennett's Government.
• As the Depression carried on, 1 in 5 Canadians
  became dependent on government relief. Around 30
  of the labour force was unemployed, where as the
  unemployment rate had previously never dropped
  below 12.

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Summary

• The era of the Great Depression (1929-39), also
  known as the Dirty Thirties, wasn't like an
  ordinary depression where savings vanished and
  city families went to the farm until it blew
  over.
• The Great Depression affected everyone in some
  way and there was basically no way to escape it.
  The Socialist James S. Woodsworth told the
  Federal Parliament in Ottawa, "If they went out
  today, they would meet another army of unemployed
  coming back from the country to the city."

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Summarycontinued

• Many people turned to new political parties to
  help solve the economic crisis, as traditional
  political parties failed to offer any real
  strategies to relieve the situation.
• Nothing world governments did to alleviate the
  economic crisis was completely successful. The
  employment and production demands of World War
  Two ended the Great Depression.