The Great Depression in Canada

• Canada was dependent on good prices and demand for staple exports. Therefore the collapse in the price and demand for wheat was catastrophic
• Australia and Argentina were outcompeting Canadian wheat farmers
• The global surplus of wheat was 12 000 million bushels in 1934
• Canadian exports decreased as Italy tried to become self-sufficient and the USA's Smoot-Hawley Tariff reduced demand
• Prices fell from $1.66 per bushel in 1929 to $0.33 in 1932
• Farm income fell by 75% and farms suffered from the dustbowl, drought and crop failures
• Overproduction was produced by incomes lagging behind production. Firms had to cut production and lay off workers
• The collapse of the US stock markets spread to Toronto; on 24th October 1929, mass selling began and bluechip stocks lost $5 billion
• The Montreal exchange saw 400 000 transactions compared to the normal 25 000
• By the mid-1930s, the stocks in the top 50 companies fell by 50%
• A significant fall in demand caused millions to become unemployed, which increased to 27% by 1932
• By September 1931, New York refused to make anymore Canadian loans because the value of the Canadian dollar had fallen so much
• 3 major Montreal financial concerns collapsed and so many firms were bankrupt that the federal government agreed to accept the theoretical, not actual, value of their assets to starve off collapse
• Income from railroads fell 50% because the decline of wheat exports meant there was less freight to transport and poverty in the prairie states led to less goods being sold there
• By 1932, industrial production fell to 58% of 1929 levels and unemployment rose to 33% when it was only 3% in 1929
• By 1935, 10% of the population was on relief. In Saskatchewan, it was 66%
• 250 000 people migrated from the prairies to urban areas like Alberta, Regina and Calgary from 1931 to 1941
• Farm income fell from $363 million in 1928 to $11 million in 1933
• Relief payments exceeded £62 million, but the government was ill-equipped with organised welfare. It could prevent starvation, but not increase demand for goods
• All provinces taxed company profits, 4 had income taxes and taxes on petrol rose 50% by 1940
• Municipalities' tax revenue fell due to unemployment but there was an increasing need for relief
• By 1933, 1.5 million people were dependent on direct relief
• Newfoundland had to submit to an emergency commission from Britain because of bankruptcy