Like two swimmers caught at the same time in a devastating flood, the United States and Canada struggled for a decade in the economic throes of the Great Depression. The essential difference between the two countries lay in their responses to their massive economic losses. America, swimming directly into the flood of economic burdens, began attempts at reconstruction as early as 1932, while Canada sank into greater debt and loss, adding to its long period of recovery.
Stock Market Crashes, Big and Bigger
Perhaps America's response to the crash of October 29, 1929, was partly out of guilt for creating it. America led the world in stock trading that day, since throughout the 1920s it had created the paradox of stocks inflated beyond their genuine value. When America's crash arrived, at a loss of 12,894,650 stock values, Canada followed suit with a more modest 400,000 shares sold. However, Canadian blue-chip stocks on the Toronto Stock Exchange suffered a loss in value of $5 billion, a record never equaled. Canada lost less than America -- and more.
Canadian and American Leadership
With world trade encumbered and import income dried up, Canada's government spent many millions it didn't have to provide relief to its citizenry. Unhappily, most of the dole rations sent out were inadequate to prevent near-starvation, and the monies intended for the poor went instead to corrupt officials, which led to the installation of the Commission of Government in 1934, a leadership as ineffectual as the incumbents it replaced. By contrast, America enjoyed decisive leadership during the crisis, beginning with Herbert Hoover's Reconstruction Finance Corporation, designed to keep American business and industry afloat.
The Two "New Deals"
The differences between America's "New Deal" under Franklin Delano Roosevelt and the ever-burgeoning government programs under Prime Minister R.B. Bennett in Canada are striking. Bennett, after failed experiments such as labor camps and raised tariffs, did little to bring economic relief. FDR's 1933 New Deal, by contrast, enjoyed immense popularity as 15 major laws restructured the American economy, a fulfillment of the president's campaign promise to take "bold, decisive action." Ironically, Bennett attempted to emulate Roosevelt's programs in Canada but was voted out of office before his plans could be finalized.
Recovery With a Smile
Another difference between Canada's and America's responses to the Great Depression is the latter's sense of spirit and hope. The source of this undoubtedly lay in its hard-working leadership, particularly that of Eleanor Roosevelt, ranked by historians as the most significant first lady in American history. Her continuous presence with her husband and support of his New Deal, together with her unflagging courage and enthusiasm, combined to make her an American paragon. Canada, lacking such a charismatic figure, marched down a much longer road to economic recovery.
- History.com: This Day in History: October 29, 1929: Stock Market Crashes
- Canada History: 1929 Crash
- Newfoundland and Labrador Heritage: Government Response to the Great Depression
- Encyclopaedia Britannica: Reconstruction Finance Corporation
- Canadian Broadcasting Company: Le Canada: Blaming the Prime Minister
- History.com: New Deal
- National Women's History Museum: Eleanor Roosevelt
- Hulton Archive/Hulton Archive/Getty Images