Causes of the Depression The Dirty Thirties

Overproduction 1. People buying goods = Industries expand 2. Companies made profits 3. This money was spent on adding to factories/ building new ones 4. Huge supplies of products 5. Products stockpiled (sit in factories unsold) 6. Owners panic 7. Slowed production 8. Laid off workers 9. People cannot buy = industries shrink

Reliance on Exports Canada’s economy depended heavily on a few basic products known as staples (crops, timber, and minerals) As long as other countries kept buying them, Canada’s economy stayed strong However, in 1929 the U.S., Australia, Argentina etc. also had record numbers. Canadian producers were left with large quantities of unsold goods Outcome: With increased competition, prices dropped dramatically

Debt from the First World War & Dependence on U.S. Canada was in Debt from WWI and borrowed money from the U.S. Canada needed to sell products to the U.S. in order to pay them back. In the late 1920’s the U.S increased tariffs on foreign goods and international trade decreased Outcome: Canada could not repay all debt

Over-Speculation of Stock Market Companies sold shares (stocks) because they wanted to expand. Investors bought shares believing the companies would do well. Many investors were buying-on-margin (purchasing shares on borrowed money in hopes of making a profit). This is called speculation. High demand of stocks drove their price up beyond real value. As stocks fell people panicked and sold their shares. Investors who borrowed heavily went bankrupt in a matter of days. Overproduction also affected decline of stock value and number of people who could afford to invest. Within a year millions of people were out of debt. See page 93 of reading

Dependence on the U.S Outcome: 40% of CAD exports sold to US. When US economy crashed, the Canadian economy was soon to follow.

Drought in the Prairies Overplanting crops by farmers In 1930s prairies had terrible drought (no water) that lasted for 8 years. As drought deepened, windstorms blew up dry topsoil creating massive, and constant dust storms Grasshopper chaos! Outcome: Many families forced to abandon land and livelihood.

Protectionism The U.S.A soon grew to rely only on their own production of raw materials. They no longer needed to trade with other countries. The U.S. became protectionist. The government protected their own industries through tariffs on foreign goods. Outcome: Extra taxes on Canadian goods into the U.S. discouraged Americans from buying Canadian As a result Canada became protectionist and increased their tariffs on foreign goods. This made the situation worse.

Unemployment As depression deepened more and more Canadians lost their jobs. By 1933, 1 in 4 Canadians were unemployed. Thousands collected “pogey” – this was gov’t relief payments for those who did not have income. These payments were very low and a humiliating experience to come by. Charities helped where they could but it was not enough.

Assignment Create a comic strip! It must highlight the causes and conditions of The Depression. The comic strip must include an image of each condition/cause, and mention how it contributed to the Depression. You can work in pairs (or alone if you prefer) There must be at least one to two people in each panel. Each person must have a speech bubble to support the panel’s summary. See example provided by teacher. You can draw your own comic strip OR create one using Comic life. The comic must be coloured.

Assessment SEE HANDOUT DEPRESSION SONG/MUSIC VIDEO - highlight all 8 causes & conditions + trigger