THE NEW DEAL. Attempted Solution 1

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1 Attempted Solution 1 Description: In January 1935, Prime Minister Richard Bennett delivered a series of radio addresses to the Canadian public to suggest a Canadian version of American President Franklin Roosevelt s New Deal. The Depression had been going on for several years and the Canadian electorate was extremely frustrated by what was seen as little government action to try and get the country back to work. With Canadians poor and out of work, action was needed. THE NEW DEAL Purpose: Prime Minister Bennett was facing an election in 1935 as his five year term was coming to an end. With what seemed to be a sure electoral defeat facing him, he decided to roll the dice and do something radical. In a move that surprised even his own cabinet, Bennett rolled out his version of the American New Deal. He hoped that these radical changes (for the time) would show the Canadian electorate that he was willing to try new things to help Canadians and ease the effects of the depression. Details: The New Deal proposed a number of changes to deal with the common worker and how business would be conducted in Canada. For workers there was a proposal for a minimum wage and unemployment insurance. The hours of work per week would be regulated. Laws would be enacted to guarantee a set of basic employee laws to prevent employers from exploiting their workers. Other actions included a more progressive tax system, health and accident insurance, an old age pension, and support for agriculture. Response: Unfortunately for Prime Minister Bennett, the electorate did not support many of his proposals. Many thought that these proposals were to radical. Many Canadians still believed that people had a personal responsibility to look after themselves and it was not the government s job to financially support everyone. Others believed the measures would be very expensive at a time when government should be cutting spending. Bennett and his conservative Party suffered a severe defeat in the 1935 election. King was swept back in to power. Reality: As radical for the time as the New Deal was, much of it was not accepted in Canada. Despite being passed in the House of Commons, challenges to the courts rejected it. Parts of the New Deal such as The Weekly Rest in Industrial Undertakings Act, The Limitations of Hours of Work Act and the Minimum Wages Act were rejected because they were seen as provincial not federal responsibilities. The Employment and Social Insurance Act was rejected in the courts for the same reason. In time however, all parts of the New Deal would come into effect.

2 Historical Comment At the same time he was a politician who knew that he faced an election in Years of depression had made his government unpopular. A reform programme seemed one way of restoring its chances of victory. There were those, mainly businessmen, who thought the programme unconstitutional, unnecessary or even harmful. Others supported it in principal, but argued that it went too far. Bennett answered charges that his New Deal was beyond the legislative power of the federal government by referring to Ottawa s power to make treaties...of more concern to him were complaints that the New Deal went too far, for many of these came from long time supporters of the party...among the New Deal statutes passed were ones providing for unemployment insurance, minimum wages, maximum hours of work, and a weekly day of rest. There were also the Canadian Wheat Board Act and the Prairie Farm Rehabilitation Act. A Conservative government had become the most reformist that Canada had so far seen! Years of Despair: Michiel Horn In January 1935, with an election approaching R.B. Bennett, in a series of radio addresses to the nation, announced a sweeping program of government intervention in the nation's economy. This was Bennett's New Deal, patterned after Franklin D. Roosevelt's New Deal in the United States. A number of promised reforms such as unemployment insurance, social security, a minimum wage law and a shorter work week were brought in by the government. Most Canadians were sceptical of Bennett's sudden conversion to government meddling in social legislation. Why had he waited so long. The people suspected that the New Deal was a manoeuvre to gain votes for the Conservatives in the upcoming election. The Liberals, although they had offered no constructive proposals of their own to end the depression, attacked the New Deal as a device to deceive the electorate. Mackenzie King claimed that Bennett fully realized that the New Deal laws encroached into areas of provincial jurisdiction and that the courts would declare them unconstitutional. At the polls, on October 24, 1935, the Canadian people showed little faith in Bennett's New Deal. The Conservative government, together with twelve cabinet ministers, was defeated. The Liberal government sent the New Deal measures to the courts, where, in 1937, the Judicial Committee of the Privy Council declared most of the statutes ultra vires beyond the jurisdiction of the federal government because they affected `property and civil rights in the provinces. Challenge & Survival: The History of Canada. H. H. Herstein et. al. Bennett and Roosevelt had a larger objective in common. Both pledged their governments to interventionism to save capitalism in North America, not to end it. When unhappy Tories suggested that his radio talk had earned him a cell in Kingston alongside Tim Buck, Bennett justified it in terms of the need to contain the rising tide of radicalism The New Deal was also intended to be a political preservative for the Conservative party. The radio addresses were the opening of the campaign for the election that had to come in Their immediate effect was exactly what the authors had hoped for, as they were well received by the press, the public, and within the party itself. The New Deal, said Toronto Tory Tommy Church, was the best news that our working population have had since the depression started But whatever momentum the government had gathered rapidly went away when parliament opened a week after the radio address. The Speech from the Throne rephrased the radio talks in much milder language, promising to remedy the social and economic injustices now prevailing and to ensure a greater degree of equality in the distribution of benefits of the capitalist system. Three acts providing an eighthour day, a six-day work week, and a federal minimum wage were passed almost without discussion. The centrepiece of the new Conservatism, the Employment and Social Insurance Act, was delayed because the bill was still at the printers. When the details were disclosed, the promised health insurance was missing, and the unemployment insurance scheme, which was at the core of the bill, was very limited in scope Canada : Decades of Discord. J. H. Thompson

3 The New Deal in the News The Globe and Mail Friday, January 4, 1935 WHITHER MR. BENNETT? Mr. Bennett s opening speech in his new campaign for recovery will arouse nation-wide, and even international, curiosity as to the program he has in view, and in this respect apparently, fulfils its purpose. We are obliged to await the remaining instalments of the serial to get the plot and its denouement. Stripped of its oratorical embellishments, however, it does not appear to suggest a radical swing to the left, except to the extent it proposes to set afoot an enlargement of Government paternalism which will tend to expand rather than contract in future years. In so far as it is intended to reform the capitalist system, so called, by cleansing it of the evils which have crept in over a long period, to give the average man a better opportunity and spread the annual wealth accumulation among more people, the necessities and possibilities are certainly great. But everything depends upon how this is to be done. To overcome indifference on these matters does not require substitution of management by Government bureaucracy or by Government Commission for the highly specialised skill which a policy of rugged individualism has developed. The Government can, and ought to, control by wise and fair legislation without removing the incentive which created strong men and women. The central theme of the Prime Minister s address, and properly so, is the unemployment plight. Whether or not he implies that reform of capitalism will adjust this remains to be disclosed. If he will tell us that the capitalist motive has been encouraged by legislative spoon-feeding and that hereafter there is to be freer competition for the ambitious and energetic individual, we shall begin to see the light. In 1930 Mr. Bennett worshipped openly and frankly at the shrine which made the United States great for a spell. He foresaw work for all in this country when industries were enabled to grow without competition and meet needs for their products at home. The plan failed. Events proved the problem more far-reaching. But recent events show that a policy of alright self-control helped to multiply the evils which have put capitalism on the defensive. We are now concerned with learning whether Mr. Bennett s new program will deal with the result or the cause. So far as we can see, there are two problems to be met. One is the reform of capitalism by the removal of artificial advantages and establishment of a freer basis of competition which will encourage the willing and ambitious. The other is to seek to provide work through natural channels. A Government cannot set 1,000,000 more people to work to meet the needs of 10,000,000 in this country any more than it could get 300,000 employed in the same way four years ago. Nor can it do so now any more effectively than then by following United States policy. It can provide unemployment insurance, which is a temporary alleviation in times of idleness, a negative way of meeting a positive problem at the expense of the employed. Nothing has been demonstrated to be truer in the last four years than that unemployment is an international problem to be solved by international action, including action to abolish unsound and selfish capitalistic policies which have contributed to idleness. This does not detract from the importance of Mr. Bennett s plans, whatever they may be or minimize his sincerity. He has conducted the nation s affairs courageously and constructively so far, and although his conception of its requirements in the last election campaign was not the cure he predicted, we can afford to wait and see if he now has something better. Obviously, anything of the sort would have to be based on a larger circumference. National bootstraps will not suffice. The Globe does not agree with his belief that solution of the railway problem is a condition precedent to prosperity, or that much will be gained by beginning at the top. Prosperity is a condition precedent to a solution to the railway problem, which is a by-product. Prosperity depends upon employment. Whence is to come the employment? This is the chief thing the country is interested in learning.

4 The Globe and Mail, Saturday, January 5, 1935 THE FIRST INSTALMENT In outlining the first part of his program for economic reform Mr. Bennett shows that he has become radical, speaking comparatively, but not reckless. His contributory insurance scheme for unemployment, old-age pensions, health, and accidents is not, on the whole, more advanced than that adopted in Great Britain, but some explanation is due as to the meaning of his expression, insurance against unemployment. If he has devised a scientific plan which will prevent unemployment he has done more than any one else, or if he has worked out one he believes to be actuarially unassailable he has gone far. It is true, time and experience in several countries are providing a basis on which it may be possible ultimately to make a fairly reliable computation of what unemployment costs, but it is to be doubted that at present this insurance can be called more than scientific unemployment relief. The chief point, however, is that the Prime Minister is undertaking to wrestle with conditions in a constructive manner, with a view to substituting for the dole, which he rightly calls rotten measures of assistance in which the beneficiaries will themselves have a stake. This feature is, of course, highly commendable, for few people in Canada have reached the condition where they would prefer public gratuities to self-help. That anything of this sort is necessary in a country of such vast resources and possibilities is regrettable, but we have realities to face. Mr. Bennett s decision to substitute contributory old-age pensions for the present system is also to be commended, although it is obvious this will not be applicable to persons now eligible for pensions. It is something to be started, with future benefits in view. Information is not given as to the machinery to be set up to carry out these plans or the extent of their application. In time, without doubt, we shall learn whether or not the insurance is compulsory, and upon whom. We shall also know whence the funds are to come to meet the public s share of the cost. Judging from the Prime Minister s plans for income taxation, the wealthy are to be called upon to pay a much larger proportion into the Treasury in the future. This is probably the answer to the question, an answer which will please the radicals and Socialists, and even many others who have become discouraged in recent years. It is apparent Mr. Bennett does not doubt the authority of the Federal Government to deal with problems heretofore assigned to the Provinces, or is convinced that it can acquire such authority. He proposes uniformity in minimum wages and in working hours throughout the country, in both urban and rural sections, and he is going to abolish sweatshop conditions and child labour. In this and other respects he intends to deal with evils revealed by the Price Spreads investigation, for which he will have nation-wide approval. Most of the points disclosed if not all of them are capable of treatment by legislation which would not be revolutionary. Mr. Bennett, however, still keeps in the foreground his promise to reform the system as part and parcel of his plan. That he knows its weaknesses and he states he has learned them from thirty years experience is not to be doubted. He has yet to enlighten us on this phase of his subject in its relations to the details mentioned so far. But he is not through. We shall look forward with special interest to his talk on the cost of living, when infirmities of the system are to be thrown into the limelight.

5 Analyze The New Deal Criteria Evidence was the least expensive? helped the most people? had most public approval? will have the most long lasting effect? is the easiest to implement?