Few countries were affected as severely as Canada during what became known as the Dirty Thirties, due to Canada’s heavy dependence on raw material and farm exports, combined with a crippling Prairies drought known as the Dust Bowl. In the rural areas of the prairies, two thirds of the population were on relief.
A third of Canada’s Gross National Income came from exports. Therefore, the country was hit hard by the collapse in international trade. The four western provinces depended almost exclusively on primary-product exports. They were seriously affected.
The Depression changed the way Canadians thought about the economy and the role of the state. The opinion was that a balanced budget, a sound dollar and changes in the trade would allow the private marketplace to recover.
The Great Depression was ushered in by the stock market crash of October 29, 1929. It ended as dramatically a decade later on September 3, 1939, when the Second World War began.
The main changes about economics was with government intervention. The attitude before the Great Depression was that government shouldn’t get involved in regulating economics, it should just follow supply and demand. The Great Depression showed us that if we just let the economy do it’s thing without intervention, we end up in Depressions. Canada responded by pumping money into job creation. They set up work camps. Provinces looked into building any kind of infrastructure they could – eg: Lions Gate Bridge, Vancouver City Hall, Patullo Bridge, etc. They had to go into debt to do so but the idea is once you get money into people’s hands, they can start spending again and the economy will recover. That’s almost exactly how our government has tackled this Covid crisis. The difference with the Great Depression is that we didn’t act right away because we thought things would naturally rebound, but it didn’t. We now know better because of the Great Depression.