1942: Alberta

Wartime prosperity and another bumper wheat crop reduced political squabbling in Alberta to a minimum in 1942, and the province enjoyed the quietest year since the advent of its Social Credit government in the midst of the depression. The only incident of consequence to disturb the year's political peace was the voiding on Mar. 27 of three provincial acts by the Governor-in-Council on the advice of Justice Minister Louis St. Laurent. These acts were: the Debt Proceedings Suspension Act, 1941, the Orderly Payment of Land Debts Act, and the Limitations of Actions Act, 1935 (Amendment Act, 1941). A fourth act amending the Municipal District Act, was referred to the Supreme Court of Canada for consideration of whether a section dealing with the first and preferential lien on crops and the proceeds of sale thereof was beyond the power of the provincial legislature. Immediately after the action, Premier William Aberhart of the Social Credit government issued a statement declaring that the Alberta government was 'being forced into a position where two courses are open to it: a new moratorium on all debts for the duration of the war or cancellation of the principal of all debts contracted before a certain date.'

Actually, no such action proved necessary. The increase in revenue resulting from the war boom gave the province an over-all surplus of $4,176,166 for the fiscal year ending Mar. 31, 1942. Revenues were $27,213,545 and expenditures $19,965,125. The surplus was applied to meeting the deficits of former governments. Interest was continued at 50 per cent of contractual interest rates, and one more default was made on this basis. Debt charges totalled $3,791,693.

Alberta benefited materially by the opening of the new United States-Alaska highway late in November. The highway makes possible the tapping of new areas of Alberta's vast oil sands which are believed to cover more than 10,000 square miles in the northeastern section of the province. It is estimated that these deposits contain enough oil of high ductility to supply the needs of the world for one hundred years. Several new refineries are being built, and the Dominion Government Mines and Resources Department assigned ten geological parties to map structures in search for oil, principally in Alberta.

The exceptionally lean years of the depression in Alberta were reflected in figures of the decennial census for 1941. In contrast with a general gain of 10 per cent in the population of Canada as a whole, the population of Alberta rose only from 731,605 in 1931 to 788,393 for 1941.

1941: Alberta

As a by-product of the war, the political dissension which has torn Alberta in the years since its Social Credit government was first elected has largely disappeared. In contrast to its attitude a few years ago, the Alberta government cooperated fully with the Dominion Government during 1941 without regard to partisan differences. Alberta participated, for example, in the discussions held in Ottawa at the end of September at which the provinces agreed to withdraw from the corporation and income tax field. The agreement was a wartime arrangement, and it is assumed that the Province reserved its rights to oppose the centralization of finance proposed in the report of the Sirois Conference.

The only elements of Dominion-provincial conflict to appear during the year were in connection with efforts of the Dominion Government to invalidate the Alberta Debt Adjustment Act of 1937 and the controversy over wheat policy. After nearly six months of deliberation, the Supreme Court rendered a decision in December declaring the Debt Adjustment Act to be invalid. The Alberta wheat pool joined with the pools of Saskatchewan and Manitoba in seeking a $1-a-bushel minimum price for wheat and a 'freezing' of the 480,000,000 bu. carryover from the 1940 crop. Both these demands were turned down by James S. Gardiner, Federal Minister of Agriculture. A relatively poor 1941 crop and a general increase in living costs combined to make for considerable opposition to Mr. Gardiner's ruling. In November a new plan of acreage bonuses for wheat growers was announced by the Government.

In contrast to agriculture, Alberta's oil industry continued to flourish. From Jan. 1 to June 30, 1941, the production of oil rose to approximately 4,700,000 barrels as compared with 3,378,852 in the corresponding period of 1940 and 3,040,000 barrels in the first six months of 1939. The most important development of the year in this connection was the strike of crude oil in commercial quantities at the Standard Oil's Princess No. 2 well in the Steveville field, 125 miles east of Calgary.

The province of Alberta defaulted on the payment of a $2,250,000 bond maturity due Sept. 1. This brought the total of defaults under the Social Credit government to approximately $15,000,000 since April 1936.

The 57th annual convention of the Trades and Labor Congress of Canada met at Calgary in September. It went on record in favor of Dominion legislation similar to the Wagner Act in the United States to give full protection to wage earners in their right to join labor unions of their own choosing.

1940: Alberta

In a preview of the Canadian National elections, the Social Credit Government of Premier William Aberhard was returned to power on March 21, 1940, for a third term, after one of the bitterest contests in the province's history. Final results, which, owing to proportional representation, were not known until more than two weeks after the election, gave the Social Credit Party thirty-six seats in the province's fifty-seven-seat legislature. Independents won nineteen seats, Labor one, and the Liberals one. In the previous legislature, the Social Credit Party had held forty-seven seats. A year earlier, political observers had freely predicted Aberhard's defeat, but it was felt that the war, which Aberhard had loyally supported, had diverted attention from provincial problems and permitted the Social Credit Party to retain power. Among the defeated candidates was J. A. Maurice, provincial secretary of the Social Credit League. Maurice was defeated by a narrow margin of four votes by Lieutenant Tremblay who was overseas with the First Division of the Canadian Active Service Force at the time of the election. Solon Low, former provincial treasurer and one of Premier Aberhard's chief lieutenants, was decisively defeated in Warner by J. H. Waller, an Independent. E. L. Gray, leader of the Alberta Liberal Party and mentioned as possible Premier in case Aberhard were beaten, was defeated in the Bow Valley-Empress district.

In the national parliamentary elections which followed the provincial poll by five days, the Social Credit (New Democracy) representation was sharply reduced. The Social Credit group won only nine seats as against the fifteen held in the previous Parliament. The Liberals won the remaining eight seats, a gain of six.

The Social Credit members of the House of Commons applied again during the November session of Parliament on the behalf of the Aberhard government for a charter for an Alberta provincial bank which could function in providing social credit 'during the years of strain and stress and in the period of reconstruction after the war.' The proposal had previously been declared unconstitutional and there seemed little likelihood that the King government, despite a desire to obtain provincial support, would accede to the request.

In the six months ending September 30, 1940, the provincial government had a surplus of nearly $800,000 as compared with $182,600 in the same period of 1939.

Alberta's oil production during the first ten months of 1940 was 6,813,347 barrels as compared with 6,396,614 in the corresponding period of 1939. A special effort was made to expand production in order to make Canada free from the necessity of importing American oil and gasoline.

1939: Alberta

Politically, 1939 was a relatively quiet year for Alberta. Set back by Supreme Court rulings in each of its previous attempts to enact Social Credit legislation, the Aberhart Government confined its activities during the year to routine matters. Interest in Social Credit was unquestionably on the decline. Membership in the Social Credit Party which numbered 27,000 at the beginning of 1938, and 42,000 a year earlier, dropped to 9,603 by the beginning of 1939.

The protracted dispute between Premier Aberhart and Lieutenant Governor J. C. Bowen caused a minor rift in the otherwise brilliant reception given to King George and Queen Elizabeth on the occasion of the royal visit to Edmonton on June 2. Since the Social Credit government had refused to support a residence for the Lieutenant Governor, it was necessary to hold the official dinner in a hotel.

During the year the Prairie Farm Rehabilitation Service opened up a new settlement at 'The Hills,' in eastern Alberta. Fifty families were settled on this subsistence homestead project, operating on 25,000 acres of newly irrigated land, during the early months of 1939.

Oil production in Alberta during the first six months of 1939 was at a new peak of 3,254,269 barrels as compared with 2,892,370 in the corresponding period of 1938, according to figures issued by the Department of Lands and Mines.

Despite the fact that many parts of Canada are observing a political truce during the war, President A. E. Goodwin of the Alberta Social Credit League indicated, on Nov. 13, that the regular provincial election would be held in 1940 and that the Social Credit government would campaign for reelection. Previously, Chester A. Ronning, leader of the Alberta Cooperative Commonwealth Federation, had declared that his party would not observe a political truce, but would 'carry on its fight against social injustice and inequality.' W. D. Herridge, leader of the 'New Democracy' movement, also ignored truce talk in launching a campaign in northern Alberta.

1938: Alberta

Interim Program.

As 1938 came to a close, the Social Credit government of Premier William Aberhart entered a crucial stage. Provincial elections must be called for not later than Aug. 22, 1940. Although neither Social Credit nor the plan to give every citizen $25 a month in scrip has materialized. Premier Aberhart has risked his political future on what he calls his 'interim program.' This program was adopted after the Canadian Supreme Court, in a decision later upheld by the Privy Council, had ruled, on March 4, that three Alberta laws, the Credit Regulation Act, the Bank Taxation Act, and the Accurate News and Information Act, were unconstitutional. These three acts constituted the framework of the Social Credit program. Chief Justice Lyman Duff also handed down an opinion that the Social Credit Act, cornerstone of the structure, was beyond the jurisdiction of the province. A Securities Act imposing a 2 per cent tax on all first, second, and third mortgages, and a Home Owners' Security Act, both passed in 1938, were invalidated by the Dominion Government.

The interim plan of Premier Aberhart calls for the establishment of credit houses, or treasury branches, in all of the principal cities of the provinces. Citizens may deposit their money in these credit houses and receive vouchers in return for use in purchasing goods from such merchants as cooperate with the plan. If one-third of these vouchers are used for the purchase of goods made in Alberta, the Government agrees to give a $3 voucher bonus per $100 spent. It is hoped in this way greatly to stimulate the use of Alberta-made goods and natural resources. The Government also hopes that the plan will prove sufficiently popular as a half-way measure to enable it to call an early election and return the Social Credit party to power for another five years.

Critics of the Aberhart régime expect the interim program to fail as completely as the Government's early attempts to introduce Social Credit through issuance of flat money. They point out that Alberta has a trade turnover of some $150,000,000 yearly. If one-third of this were in Alberta-made goods and a 3 per cent bonus were paid on the entire amount, the Treasury would be compelled to pay out $4,500,000 each year, which is far beyond the capacity of a province already in default of many of its bonds. One factor operating in favor of the new credit houses is the fact that a number of branches of large Canadian banks were closed in early summer because of heavy taxation and difficult political conditions. Whether the credit houses will be trusted by the average citizen who refused to accept Aberhart's flat currency in the past remains to be seen. If they meet general approval. Aberhart will have control over the chief source of credit — bank deposits — without the regulation of the banks, which has been blocked by the Dominion Government and courts. The response thus far has been distinctly disappointing to the Social Credit leaders.

Politics.

The only test of the political popularity of the Aberhart régime during 1938 came on November 7 with the election of C. H. Tade, an Aberhart supporter, over C. J. R. Whiteley, Liberal, by a relatively close margin. It was the first by-election in a rural constituency which the Social Credit Government had been called upon to defend since its ascent to power in 1935. This victory was more than offset, however, by the setback suffered by the Social Credit party at the Saskatchewan elections in June. Premier Aberhart had laid much emphasis upon the necessity of spreading to other provinces if the party were to obtain sufficient power to introduce a genuine Social Credit program.

Premier Aberhart's long-standing feud with Lieutenant-Governor J. C. Bowen came to a head in the spring, when the Premier forced through an Order-in-Council compelling him to vacate the Government House. To avoid difficulty. Governor Bowen signed the order and vacated on May 10. In August the provincial government restored the Lieutenant-Governor's allowance for a secretary, chauffeur, and motor car, thus easing tension somewhat.

Economic Improvement.

It is generally agreed that the prospects of the Aberhart government in the forthcoming election depend largely upon economic conditions. After years of drought and hardship. Alberta enjoyed relatively good harvests in 1938, marred only by the damage done by a severe hailstorm in the north. As a result, unemployment was appreciably reduced. While a further improvement in business conditions may aid Aberhart by eliminating discontent, political observers feel that it would also reduce the popularity of panaceas such as those proposed by the Aberhart régime and would probably work for his overthrow.

Finances.

The provincial budget remained in balance by dint of an arbitrary cut in interest rates. Revenues for the fiscal year ending March 31, 1938, totaled $24,127,805 as against expenditures of $21,359,739. The over-all surplus, after deducting capital expenditures, was $1,083,494 as contrasted with $16,639,576 in the previous year. No provision was made for the sinking fund.