The 1936 Canadian Election - Confederation
Part XXXIV - The Great Depression
TLDR for the following available at the bottom
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Dealt A Bad Hand
No Prime Minister had entered office at perhaps a worse time than Henry Wise Wood. Inheriting both the depression and a series of droughts in the prairies, the new Prime Minister –never before having held public office– was now in charge of the management of 5,500kms of land from east to west and 10 million residents. However, the Prime Minister’s extensive background in farming would prove an asset to his administration. Wood’s first initiative as Prime Minister would be to return former Prime Minister Thomas Crerar to the position of Minister of Agriculture, a post he held during the last Progressive administration. Wood had actually desired Crerar to serve as his Deputy Prime Minister in a co-ministerial capacity, but had been forced to elevate Ernest Lapointe to the position to placate the Liberals. Still, Crerar’s still considerable influence within the party made him the de-facto secondary Prime Minister.
Wood and Crerar first sought to alleviate a stretch of droughts in the prairies, which had begun in 1929 after a stretch of particularly dry seasons compounded by destructive farming practices. Luckily for the Prime Minister, the crisis had alleviated somewhat during the Tory years, as a result of actions taken by the last administration. In order to shield against future damages, the federal government began a ‘shelterbelting’ initiative in 1932, purchasing around $9.5 million dollars worth of fast-growing Manitoba Maple and Willow tree seeds and distributing them to farmers registered with the National Farmer’s Bureau (NFB). In 1934, Wood was joined in his efforts by the United States under President Franklin D. Roosevelt, who agreed to collaborate with Canada on constructing shelterbelts across the North American west. It would, however, still take around 10-15 years for the trees to grow fully, thus requiring additional policies to alleviate the situation.
At the same time, Administrator Herbert Greenfield of the NFB, in partnership with Farm Credit Administration head Frank C. Biggs, introduced new restrictions on farmer’s benefits. In order to qualify for federal assistance and for equipment loans, farmers now had to adopt sustainable soil conservation practices, such as crop rotations and contour plowing, or strip farming when applicable. Even with the new changes, many farms were slow to adopt the new practices, prompting the Farm Credit Administration to begin issuing a blanket $3 fine every 3 months to farms who hadn’t switched in mid-1933.
The fines, however, proved highly unpopular, with the Conservatives under newly-elected leader Robert J. Manion claiming the Progressives had begun a war on struggling farmers. Indeed, many farms had gone out of business without support from the government and the newly added fines. In early 1934, Prime Minister Wood fired Biggs as FCA Administrator and replaced him with Robert Forke, who reversed the policy and issued rebates to those fined, along with introducing an incentive program of $0.50 per acre per year to farms that adopted sustainable practices, raised to $0.75 by 1936.
Alongside the programs designed to assist farmers, the Progressives initiated a series of welfare reforms, further cementing Canada’s status as one of the world’s foremost welfare states. Wood personally desired a comprehensive unemployment insurance program, but deemed it would be too expensive given the current economic situation. Rather than forgo the idea entirely, Wood passed an amendment to the British North America Act with consent of the provinces ceding provincial control over unemployment issues to the federal government. Then, he passed the National Unemployment Insurance Act in 1935, but stipulated the program would only enter into effect when the national unemployment rate fell back below 8.5%. The act also created the Canadian Employment Insurance Agency, another crown-corporation which would manage unemployment insurance. Registered employees would pay 2% premiums off their salary, and, if they happened to become unemployed after 15 weeks of consecutive employment, they could apply to receive benefits back of up to 35-70% of previous wage, depending on the number of dependencies in the family.
Job training programs were another major initiative of the Wood administration, focused on training displaced workers with new skills. Public works initiatives started by the Tory administration were expanded upon, primarily related to infrastructure improvement in major cities and road construction. In 1933, the government also began a food subsidization program, which paid needy families $0.25 per head every week so long as at least 95% of that money went towards purchasing food, with receipts needed to be turned in every week to receive benefits for the following week.
A Cooperative Step
Although the government initially expected the situation to improve, a heat-wave and drought in 1934 temporarily brought back some issues, although the United States was impacted far worse than Canada. To provide relief to displaced farmers, and to boost Canada’s industrial might, Wood created the Canadian Industrial Bureau as a division of the Department of Labour, appointing former Conservative-Labour deputy Abraham A. Heaps as the first director.
In late 1934, Heaps began a controversial initiative of buying out and, in some cases, nationalizing struggling factories and factories deemed ‘essential’ to communal interests. Steelmaking in particular was targeted by the government, with Wood announcing in 1934 that it was the intention of the government to nationalize Hamilton-based giant Stelco by the end of the year. Business leaders and Conservatives immediately protested the announcement, with Manion himself proclaiming the move was “a short stop shy of full-blown communism.” But with Heaps’ plan to operate the company as an independent crown-corporation, focused on temporary government-subsided expansion to provide jobs to displaced workers, the plan proved popular enough with the general public to carry with majority support in parliament.
On November 20th, 1934, Stelco was officially nationalized by the Canadian government, followed by Algoma Steel in May of 1934. Both companies were incorporated into the new crown-corporation Canadian National Steel Company, alongside the newly established Western Steel Company. With support from the government, Canadian National Steel was able to reopen some previously closed factories in Ontario, providing jobs to former workers. However, the high cost of both production and the subsidies to keep the corporations solvent still attracted criticism from the Conservatives. Indeed, Wood’s ambitious spending programs had massively increased the national debt— though most voters seemed willing to ignore that fact amidst the hardships. Simultaneously, the Western Steel Company began working on developing industry in the major western cities, most efforts focused on Winnipeg, Calgary, Edmonton, and Vancouver.
Another major initiative of the Wood administration would be the establishment of a central bank, in charge of the nation’s monetary policy. In 1933, the Bank of Canada would be established as an independent crown-corporation. Somewhat inspired by the new branch of Keynesian economics, Wood desired a stronger central bank which could help regulate inflation and the foreign exchange market. This was primarily due to his desire to have an instrument which could help his government prevent hyperinflation amidst high spending during the recession. Ontario economist W. Clifford Clark, an independent who leaned towards the progressives, was appointed as the first governor.
Radicalism on the Rise
As is to be expected during any major economic crisis, radical politics on both the left and right gained significant attraction during the Wood years. The Commonwealth Party, which already held 14 seats in parliament and governed as a part of a coalition deal with the Progressives, saw a boost in membership within cities and among labour unions. The rise of Commonwealth support led to an interesting duality among Canada’s two major left-wing parties, wherein the Progressives represented the agrarian interests of Canadian farmers and the Commonwealth represented the industrialized interest of Canadian workers.
Although these parties agreed on a majority of issues, one particular break was with tariffs, where the Progressives favored lower tariffs and the Commonwealth favored higher tariffs. When Minister of Finance George P. Graham presented a new trade deal with the United States to parliament in 1935, negotiated with F.D.R as a part of a bilateral effort to reduce tariffs in both countries, the Commonwealth broke with the Progressives for the first time in opposition to the deal. The deal was able to carry with majority support, as the Progressives still had a majority without the Commonwealth, but pressure from unions and the cities forced Graham to negotiate an amendment deal the following year, which raised protections on certain industries (but did not return those tariffs to pre-Wood levels). The tariff debacle served to reinforce the Urban/Rural Commonwealth-Progressive divide, but the coalition survived in the face of more pressing issues.
The Commonwealth found even more success on the provincial scale, with the British Columbia Commonwealth Party winning the 1935 Provincial Election, defeating the incumbent centrist Popular Alliance under Duff Pattullo. In Quebec, the Commonwealth-affiliated Action Québec under Paul Gouin ran a nationalist social-justice based campaign that appealed to both rural and industrial workers, unseating the incumbent Liberals under Louis-Alexandre Taschereau which had held power continuously since 1886 (except for a short 8-month Conservative government in mid-1891). Gouin’s government, however, fell short of the threshold for a majority, and made a controversial deal with the local Conservatives to take power.
The nation also saw a significant shift towards the right. Radical right-wing ideologies, such as facism, found a home in the Patriotic Front of Canada, a party formed in 1931 by conservative hardliners who opposed the policies of Tory. The party held 8 seats in parliament, including their leader businessman Herbert Holt and deputy leader journalist Adrien Arcand. Arcand in particular was one of the most vocal critics of the Wood administration, who advocated for a fascist Canadian state within the British empire. Arcand allied himself with the British Union of Fascists and the fascist regimes in Germany and Italy, pointing to the economic revitalization of European economies under those leaders and promising to do the same in Canada. In 1933, Arcand and Holt switched places, with Arcand becoming leader and Holt becoming deputy leader, due to fears that Holt’s business association could dampen the party’s populist messaging.
The Patriotic Front found most of its success in Alexandra, where the American far-right white-supremacist group the Ku Klux Klan had amassed significant political influence in the 1920s pushing anti-indigenous and anti-immigrant sentiment. Ahead of the 1932 Provincial Election, Holt poured a significant amount of his own resources into helping the local branch of the party win the election, in hopes that a provincial victory would grant the party the national legitimacy it desired.
The incumbent centrist Liberals under Premier James Gardiner had taken office mere months before the Depression, and had largely been blamed for their failure to respond to the economic effect of the crisis. Thus, the left-wing Farmers’ party, aligned with the Progressives, was the favourite to win the election. However, many voters held reservations over Farmers’ Party leader George Hara Williams, a 37-year-old firebrand and controversial activist. Throughout the 1920s, Williams had associated himself with the controversial Marxist Farmer’s Reform League, and had even made a visit to the Soviet Union in 1931, which had prompted a brief and unsuccessful recall effort in his home riding of Wadana. Still, federal Progressives elected to support his leadership campaign due to his popularity among farmers, believing the Liberals too unpopular to mount any sort of real opposition.
However, the controversy around Williams played right into the hands of the Patriotic Front. In January, Holt personally selected former Mayor of Saskatoon Walter Davy Cowan to be the party’s leader. Cowan had served as Mayor from 1916 until 1919, before a brief stint in Parliament as a Conservative from 1919 to 1925. Cowan was also the provincial treasurer of the Alexandra K.K.K, who campaigned for the Front during the last election. Cowan’s experience in politics and his personal name recognition contrasted with the controversial Wiliams. Additionally, Cowan’s hard campaigning on Williams’ suspected communist involvement and political inexperience persuaded many dissatisfied right-leaning and moderate voters, not to mention the added benefit of being able to outspend Williams 5-to-1 thanks to Holt. By February, Progressive insiders began to worry over the possibility of a Front victory, and attempted to persuade Williams to step down and allow former Prime Minister John A. Maharg to run instead. Williams, however, refused, insisting he could win the election.
Ultimately, the Patriotic Front would pull ahead in an upset victory, elevating Cowan to the Premiership with a thin majority in the provincial legislature. Although Cowan would serve as the figurehead of the government, Holt would dictate most of the policy initiatives implemented during Cowan’s term, governing the province more moderately than expected in order to quell national fears about the party and build legitimacy. The Front mainly focused on alleviating the financial situation of farmers through provincial grants, although several anti-immigrant policies were implemented during this time. The moderation of the party, however, strained relations with the even more extreme-right Alexandra K.K.K, of which several MLAs were members. Many voters, indeed, felt betrayed by the party, as promises of radical change had turned into a regular Conservative-lite style of governance.
In 1934, several more radical MLAs voted against that year’s budget, resulting in a defeat of 39-41. As per custom, the government dissolved and called a general election. In pursuit of vanquishing the Patriotic Front, Williams agreed to resign as leader, with former Premier and 130-day progressive Prime Minister John A. Maharg, still a popular figure in the province, taking over. Additionally, Gardiner and the Liberals agreed to suspend candidates in the election and coalesce around an anti-Front ticket. In the pursuing general election, Maharg and the Progressives would win the election, taking a majority with 43 seats in the legislature. Despite their defeat, the coalition
The final radical provincial shift occurred in Buffalo, where the Social Credit Party under Christian preacher and teacher William Aberhart took power in 1934 after a landslide victory over the dominant Conservative-Labour Party. Inspired by the “social credit” theory of British engineer C.H. Douglas (although it is speculated Aberhart himself doesn’t understand them), Aberhart rose to prominence in the 1920s with his Sunday Bible radio show on CFCN, one of the first to broadcast over the Canadian prairies. In 1931, Aberhart became infatuated with the idea of social credit monetary reform as a solution to the depression, lobbying the opposition Farmer-Labour party to adopt the policy. The Farmer-Labourers, however, were reluctant to do so, as their leader Richard G. Reid did not believe it would be an effective solution to the depression. Still, with the situation worsening for Buffalo, and both the Conservative-Labour and Farmer-Labour party refusing to adopt his ideas, Aberhart elected to create his own political party, the Social Credit Reform Organization of Buffalo. Ahead of the 1934 election, the SoCreds did not anticipate electoral success. However, the unpopularity of Premier Patrick Burns for his failure to alleviate the depression, alongside Reid’s refusal to adopt social credit theory, contributed to a surge of support for the Social Credit party ahead of the election. In the ensuing election, the SoCreds won a 40/65 majority in the legislature, elevating the surprised Aberhart to the Premiership.
Unfortunately for the party, the dire financial state of Buffalo left them mostly unable to enact their agenda, although “prosperity certificates” were issued to the public in 1935 as a form of intra-provincial currency designed to pay workers and encourage spending. Another major initiative of the Aberhart government has been banking reform, with the Buffalo Treasury Bank established in 1936 as a provincial crown-corporation alternative to traditional banks.
Short Notes (TLDR) -
Prime Minister Henry Wise Wood, Progressive (1932-1936)
- Massive spending projects designed to alleviate the depression, in the form of public works and a food subsidization program.
- National Unemployment Insurance passed, to take effect when unemployment is at manageable levels.
- Steady nationalization of steel industry, with government also taking over and reopening abandoned factories. Liberal usage of crown-corporations.
- Government has combatted drought through shelterbelting initiatives and promoting sustainable farming techniques, first through fines (repealed) and now through tax credits.
- Pro-trade policies have deepened the divide between urban Commonwealth Party and rural Progressive Policy, though the two remain united so far.
- Creation of a strong Central Bank in 1935, Keynesian-leaning economist W. Clifford Clark made first governor.
- Facing critiques due to high spending and mounting government debt, although effects of the depression have begun to lighten.
Across Canada
- Commonwealth take power in British Columbia and Quebec, although the Quebec affiliates have shown nationalist and social conservative tendencies.
- Far-right Patriotic Front take power in Alexandra, soon after ejected in 1934.
- Social Credit take charge in Buffalo under “Bible Bill” Aberhart, struggling to enact agenda.
The Candidates
Henry Wise Wood, 76-years-old, is the incumbent Prime Minister, leading the Progressives in a majority government. Wood, as the President of the United Farmers of Canada, was an instrumental figure in the creation of the Progressives, but repeatedly declined the leadership due to his avoidance of electoral politics. Well known throughout the nation for his leadership of the United Farmers, Wood finally decided to run for the leadership due to his opposition to the conservative Laporte Budget of 1927.
Wood’s first term as Prime Minister has been dominated by the depression, which he has combatted through various social programs and public works initiatives. Under his watch, Canada has implemented the world’s first food assistance program, began the nationalization of the steel industry, and provided jobs through public works infrastructure projects, however some have grown weary of the ever expanding national debt. For his second term, Wood has promised to make greater efforts regarding rural electrification, and potentially enact his proposed third branch of parliament to represent the interests of class groups, an idea he calls “group government.” Under Wood’s proposal, members of this body would be appointed proportionally to how large the class, such as farmers, fishermen, miners, shopkeepers, etc. were in the population, and would be given a say on legislative matters. Despite some popularity amongst Progressives, it enjoys little support amongst conservatives and moderates.
Robert J. Manion, 55-years-old, is the leader of the Conservative and Labour party and a Member of Parliament for Fort Williams. A physician by trade, Manion served in the Medical Corps of the Canadian Army during the Great War, where he won a Military Cross for his actions during the Battle of Vimy Ridge. Manion was selected as a “star candidate” for the Liberals in the 1919 Election, squeaking by in a narrow victory in a year where the Liberal Party fell to 3rd place for the first time in its history. As the Liberal Party faltered during the 1920s, many MPs defected over to the Progressives. Manion, however, believed the Progressives too inexperienced and radical to govern effectively, and joined the Conservatives.
Manion rose to national prominence during the Tory Administration, where he served as Minister of Commerce during the whole tenure. As minister, Manion worked to encourage business interest in Canada, helping to lower taxes and provide loans to businesses. Although the growth-focused policies of Manion and Minister of Finance Charles Ballantyne did help to stir the Canadian economy out of a decade of slump, most of their progress was erased by the beginning of the Great Depression in 1929. During the Depression, Manion switched gears, supporting moderate unemployment relief. He did not run for Conservative-Labour party leader in 1932, rather, he was selected as a compromise candidate to bridge the gap between left-wing Abraham A. Heaps and right-wing R.B. Bennett.
Although he supports some relief for the depression, Manion has criticized the ‘excessive’ spending of the Wood administration, claiming high government spending and the new deficit has stifled private enterprise, and that the government’s openness to nationalization has scared away private investment in Canada (a claim even some right-wing Progressives like former Buffalo Premier John E. Brownlee support). Instead, Manion has proposed enacting expansionary fiscal policy to boost business growth across Canada, creating a lower-tax country which can potentially attract some businesses away from the increasingly left-wing United States F.D.R. On the matter of welfare, Manion has proposed continuing some policies for the time being, but has committed to phasing some programs out when the economy returns to normal. He has promised to privatize steel, but has said he would break up the company into several parts so that no single entity has above 20% estimated market share.
M.J. Coldwell, 47-years-old, is the current leader of the Commonwealth Party and the Minister of Finance under Prime Minister Wood. Born in the United Kingdom, Coldwell immigrated to Canada in the early 1910s to become a teacher in the prairies, finally settling on the outskirts of Cartier-Prince Albert, the capital of Alexandra, by 1920. He rose to national prominence in the 1920s as a leader of the Canadian Teacher’s Association, serving as the organization’s President from 1922 to 1926 before completing one term as the Mayor of Cartier-Prince Albert from 1925 to 1927 as a Progressive. In 1927, despite his progressive ties, he was invited to run for Parliament as a Conservative-Labour party member by then-leader Henry Marshall Tory. Tory, himself a professor seeking to reform national education, believed Coldwell could assist immensely in his reform efforts.
Despite his friendship with Tory, Coldwell found himself at odds with the Conservative establishment. He aligned himself strongly with the left-leaning wing of the party, which put internal pressure on the government to meet union demands in the wake of the beginning of the Depression. However, Finance Minister Ballantyne’s reluctance to intervene on behalf of the worker culminated in 10 Conservative-Labour MPs, Coldwell among them, leaving the party on Halloween Day 1930 to form the Canadian Commonwealth Alliance, or Commonwealth for short. At the party’s first general assembly, Coldwell was elected leader unanimously.
Coldwell entered into an electoral alliance with the Progressives after the 1931 Election, serving as finance minister under Wood. Policy-wise, the two parties differ only slightly, with Coldwell and the Commonwealth supporting tariffs as a means of protecting workers while the Progressives support free-trade. However, in the event of a hung parliament, it is very likely Coldwell will allow Wood to continue his term as Prime Minister (although given Wood’s advanced age, he is the favourite to succeed him as P.M. should Wood resign). Coldwell supports expanding the nation’s welfare, such as national old age pensions, which were promised by the Progressives under Shaw in 1925.
Adrien Arcand, 36-years-old, is a journalist and leader of the far-right Patriotic Front. The Front was founded in 1931 as an alternative to the Conservative party, and advocates in favour of Benito Mussolini’s new ideology of “fascism,” seeking to adopt elements of the ideology in Canada. The Front vehemently opposes communism and organized labour, decrying it as a puppet for Soviet influence. The Front also promises economic salvation through cooperation with business and the cutting of red tape and taxes. Arcand and his deputy, former leader and businessman Herbert Holt, have campaigned on “constructive nationalism” (nationalism serving the interests of the State) and Holt’s business experience.
Arcand and the Front have seen some electoral success in the provinces, with Walter D. Cowan leading a brief Patriotic Front government in Alexandra from 1932 to 1934. The campaign of the Front has been particularly vague, calling on the adoption of fascism to solve Canada’s economic strife and return the nation to the economic prosperity of the 1890s.
Louis-Alexandre Taschereau, 69-years-old, is the former Premier of Quebec who leads what has been called the Nouveau Parti-Libéral, billed as Parti-libéral on the ballot. Receiving his law degree in 1889, Taschereau entered politics as an old-school fiscally conservative Liberal, being elected as an MNA for Montmorency in 1899. When Premier Lomer Gouin resigned in 1919 to unsuccessfully run for the national party leadership, Taschereau took over the government in his stead. Even as the federal Liberals collapsed in the 1920s, Taschereau’s provincial liberals flourished, taking supermajorities in every provincial election. After the final collapse of the Liberals in 1929, Taschereau attempted to persuade the Progressives to adopt pro-francophone policies and moderate their platform, to no avail. Seeking no other option, Taschereau revived the Liberals as a region-exclusive party in 1934, hoping to push Quebecois interests in parliament.
As a fiscal conservative, Taschereau opposes the welfare initiatives of the Progressives, believing free enterprise the most effective solution to the depression. He has also explored the potential benefits of hydraulic energy in Quebec, but seeks private capital for development. Partially due to his fiscal conservatism, however, the Liberals lost the 1935 Quebec General Election to the Commonwealth-affiliated Action-Québec, although it is worth noting Taschereau still won the popular vote in that election.
Contrary to popular belief, Taschereau is not a vehement Quebec nationalist, nor is he a separatist. Merely, he has become concerned by the complete ignoral of Quebec by both major parties, appalled at the fact that the Wood government and the preceding Tory government had only 2 and 1 Francophone ministers respectively (out of 39 and 33 major posts), despite Quebec making up 27.7% of the population. The Parti-libéral runs candidates only in Quebec, and in some Francophone-heavy communities in New Brunswick and Hudson.
William Aberhart, 57-years-old, is the incumbent Premier of Buffalo and leader of the Social Credit Party of Buffalo. Although not technically a party leader, as the federal Social Credit Party does not have one, as the only current Social Credit member in a position of executive power, he is the de-facto face of the party. The SoCreds advocate for the Canadian government to issue debt-free money every month to the people, in order to combat the depression. As Premier, however, Aberhart has had limited success implementing Social Credit policy.
The SoCreds have not mounted a nation-wide campaign, rather focusing on regional support in the west to pressure Parliament into adopting their manifesto.