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Richard Bedford Bennett
On Reform and Recovery

The Right Honourable Richard Bedford Bennett
Radio Addresses from Ottawa
January 2, 1935

The time has come when I must speak to you with the utmost frankness about our national affairs, for your understanding of them is essential to your welfare. This is a critical hour in the history of our country. Momentous questions await your decision. Our future course must now be charted. There is one course, I believe with all my heart, which will lead us to security. It is for you to decide whether we will take it. I am confident that your decision will be the right one, when, with care and diligence, you have studied the facts. Then you will support the action which your judgment decrees to be imperative; you will strive for its success, for its success will determine the future of Canada.

In the last five years, great changes have taken place in the world. The old order is gone. It will not return. We are living amidst conditions which are new and strange to us. Your prosperity demands conditions in the old system, so that, in these new conditions, that old system may adequately serve you. The right time to bring about these changes has come. Further progress without them is improbable. To understand what changes and corrections should be made, you must first understand the facts of the present situation. To do that, you should have clearly in mind what has taken place in the past five years; the ways in which we have made progress, the ways in which we have not. To do that -- to decide wisely -- you must be in a position to judge those acts of Government which have palliated your hardships, which have preserved intact our industrial and financial structure, and which have prepared the way for the reforms which must now take place.

Canadians are not those from whom unpleasant facts should be concealed. The people of this country were born optimists, but they were born realists as well. They demand the truth, however disturbing it may be. And the truth IS disturbing. The world is in tragic circumstances. The signs of recovery are few and doubtful. The signs of trouble are many, and they do not lessen. The world is searching pathetically for safety and prosperity. It will find them only when each nation, resolute to effect its own regeneration, will come to a meeting place with all the others, in the spirit which declares that even the most powerful among them has no real economic independence of the rest.

That time has not yet come. Meanwhile, dangers abound.

We Will Fight On

This discussion of our national affairs will take time. It must be thorough. All phases of the situation will be dealt with, for it is vital that you be put in complete possession of the facts. To accomplish this, I have decided upon a series of half-hour broadcast talks. I ask you to give me your earnest and patient attention. I wish with all my heart that I had nothing but good news for you. When one has been head of the government of this country for more than four years and has done his level best, and has worked with all his might to bring you security, it is with inexpressible regret that he speaks as I must now speak to you. But the facts, grave as they are, do not cast me down. Nor will they you. I am deeply anxious, but I can never doubt this country's coming triumph if you will range yourselves on the side of progress and reform. For then we will fight on, you and I, and we will win.

First of all, I shall have a few words to say about conditions as they were in 1930, and as they have been since that time. Then I shall tell you what the policy of the Government has been during that unhappy period. I shall discuss the nature of the measures taken by the Government. You will realize that they were the only ones which the circumstances permitted. You will say, I think, that they were the only ones which were wise. I shall then show you that the time has come for a radical change in the policy of the Government. You will, I know, agree upon its necessity and approve its timeliness. I shall exactly explain what this policy is and develop my plans for its execution. After you are fully acquainted with what has taken place and with the conditions of today, I am confident that this policy will receive your enthusiastic support. Without your support, I am unable to carry it out. Therefore, when you have had an opportunity to thoroughly examine the whole condition of affairs, I will ask you for a decision. You will not be hurried. You will have ample time to test this programme of reform and to decide upon its value. I will then invite your considered opinion as to whether reform is in fact necessary, and as to whether my programme of reform is wise. If you say yes, then I will not rest until I have put it into operation. But if you say no -- if you are satisfied with conditions as they now are, if you think that there is not need for reform, if you feel that the Government is not required to do anything more -- then I am not willing to continue in this office. For if you believe that things should be left as they are, you and I hold contrary and irreconcilable views. I am for reform.

The End of Laissez Faire

And, in my mind, reform means Government intervention. It means Government control and regulation. It means the end of laissez faire. Reform heralds certain recovery. There can be no permanent recovery without reform. Reform or no reform! I raise that issue squarely. I nail the flag of progress to the masthead. I summon the power of the State to its support.

Who will oppose our plan of progress? It will be interesting and instructive to see. It seems to me that the party which supports laissez faire, which demands that Government do not interfere with business, which says that the State has no such part to play in these critical times -- it seems to me that that party may have a change of heart when it sees how the rest of us feel about the matter, and may decide to come along with you and me. Well, if it will denounce its hereditary chieftain, which is reaction, abandon its creed of inaction, and pledge its allegiance to action, to progress, to reform -- it will be welcome if it is really sincere. For I am working, and working grimly, to one end only; to get results. And so, honest support from every quarter from men and women of good will, of every party, race and creed, I hope for and heartily invite.

There must be unity of purpose. There can be no success without it. I earnestly entreat you, be in no doubt upon that point. I am not. If I cannot have your whole-hearted support, it is wrong for me to assume the terrible responsibility of leadership in these times.

I am willing to go on, if you make it possible for me still to serve you. But if there is anyone better able to do so, I shall gladly make way for him. And it is your duty to yourselves to support him, and not me. Your country's future is at stake. This is no time to indulge your personal prejudices or fancies. Carefully and calmly, look well into the situation. Then pick the man and the policy best fitted to deal with it. And resolutely back that man and that policy. The nation should range itself behind them. In war you fought as one. Fight now again as one. For the task ahead demands your war-time resolution and your war-time unity.

When my Government came into power in 1930, the economic system of the world was rocking to its foundations. An economic disaster, unparalleled in the history of our civilization, had overtaken us. We were in the grip of something more than a serious illness. Its fatal termination was averted only by means never invoked before. We have been sick almost unto death. But we have survived. Given the right sort of treatment, we will completely recover.

To End Unemployment

In 1930 there was serious unemployment. Unemployment became greater and greater in the two years following. During the last year, we have been able to put large numbers of men to work. That was a real achievement. It is a fine beginning, but it is only a beginning. I told you in 1930 that I would end unemployment. That was a definite undertaking. By it I stand. Unemployment in Canada today is one of the consequences of this awful and unprecedented world depression. The continued faulty operation of the international economic machine has made re-employment impossible. I do not offer that as an excuse. I state a fact. Therefore, now that the time has come, I am determined to try with all my strength to correct the working of the system in Canada so that present unemployment conditions may be put an end to. When I say I will correct the system, I mean that I will reform it. And when the system is reformed and in full operation again, there will be work for all. We then can do away with relief measures. We then can put behind us the danger of the dole. I am against the dole. It mocks our claim to progress. Canada on the dole is like a young and vigorous man in the poorhouse. The dole is a condemnation, final and complete, of our economic system. If we cannot abolish the dole, we should abolish the system.

In my next speech I shall deal more specifically with the unemployment question.

Canada Is More Prosperous

When my Government came into office, our trade had already fallen off. As the depression deepened, our trade further diminished. In 1932, it was undoubtedly in a very bad state. There is little purpose in prolonging the melancholy recital of conditions in those first years of the depression. In 1930, conditions were far from satisfactory. In 1932, they were very much worse. The courage of our people, the robustness of our economic structure, the effectiveness of your Government, are all overwhelmingly attested by the fact that, though in 1932 we were in a most critical condition, we did not perish. On the contrary, we fought back strongly. I pay my tribute of profound admiration to the gallantry and patience of the people of Canada in those terrible times.

Other nations have also fought bravely and have done well. But no people with burdens comparable to yours have done better. You have reason to be proud of the past. You have reason to be confident of the future.

Out of the depths of this depression you have struggled. By any economic test you may employ, Canada is more prosperous today than it was two years ago. As I say, employment is increasing. Take our trade returns. They are indeed phenomenally better. Take the conditions of industry. Here you have substantial improvement. Agriculture, a double victim of economic and climatic conditions, is entering upon more promising days. I am within my rights when I claim a definite advance. I am not within my rights if I claim that our troubles are over and that all we have now to do is to fold our hands and be patient and expect the best. For that is not the case. We have come part way. The rest of the journey is a hard one. Our greatest obstacles yet remain. Look at our burden of debt. It has not diminished. Look at the poverty of many of our people. It is very real. Look at the problem of our railways. Its solution is a condition precedent, I earnestly believe, to prosperity.

Our taxes are high. Our national income is not what it should be. Our trade, domestic and foreign, though vastly improved, must be much greater yet. We have worked hard to secure markets for our natural products. The result of our labours has been remarkable, but we must keep on working, for we need more markets still.

Time for Reform Is Now

In the beginning of its term of office, the policy of the Government was determined by the critical nature of the times. The economic system had broken down. Dismay and uncertainty prevailed. We were storm-tossed in turbulent seas. Swift and decisive measures were needed to avert shipwreck. The emergency demanded emergency action. It was no time for changes or reforms in the economic system. The only sensible thing was to get behind the system and make the best of it, until the fury of the storm had abated.

This your Government did. We gave unswerving support to finance. We stood behind industry. We aided agriculture in all the ways we might. You know what we did. It was singularly effective. Look at conditions in your country during the worst period of the depression, and compare them with conditions in other countries. I think you will agree that our relatively fortunate state is the surest proof that your Government faithfully supported our people in their splendid struggle against the depression.

This Government was not long in office before demands for reform were made upon it. Such demands were natural. But, in your interest, they could not then be heeded. The ship was pounding in mountainous seas. That was not the time to try to recondition it. We had first to save the ship and guide it into less troubled waters. I do not think that even my most irrational opponent will cavil at the sanity of that course.

Not Impulsive Action

We were determined to resist the impulse to change until we could be satisfied that change was beneficial: until we could be satisfied that change was safe. We were not prepared to make any alterations in our system until we knew that they would improve it. Conditions in those times were very bad. But assuredly they would have been made worse by any intemperate, ill-considered action which we might have taken.

I will not deny that the temptation was great. We were daily faced by the tragedies of the depression: our unemployed, the suffering poor, the perils which assailed business of all sorts, the plight of agriculture. I can assure you that it was not easy to say no. I had to harden my heart. I did so, but with more sorrow and sadness than I have ever known in my life before. I can assure you with equal truth that, had we said yes to those sometimes frantic pleas, Canada would not have been where it is today. We had to defer reform until the time for reform had come. Our duty and your welfare left us no other course. Consider what would have been the consequences of a blunder in those critical times. Determine the cost of ill-founded experiment. You will see that a false step might have led us to disaster. I ask you to pass judgment upon these points. I ask you to say whether the Government's emergency measures were sound. When you have done so, you will then be required to determine whether the Government's new policy of reform is also right and whether we have chosen the proper time to introduce it.

Now, you will understand that by recovery measures I mean measures which work no change in the economic system. They are emergency measures designed to support the system during the depression, but do not interfere with its operation, and do not, of course, contemplate any modification or correction in it. Recovery measures of the proper kind minimize the dangers and ameliorate the hardships incident to the depression. They also stimulate the movement toward recovery. This kind of assistance is sometimes known as "priming the pump".

To Change the System

Reform measures, on the other hand, are measures designed to effect a change in the existing system. They are measures to be taken when it has been decided that the existing system is faulty in some major or minor respect, and that this fault must be cured before the system can satisfactorily function again. These reforms may be, as you can imagine, of very many different types and of varying significance; but, whatever their importance or character, they are all refutations of the old idea that government should leave business alone. This old doctrine is known to some people as the doctrine of laissez faire, and it originated at a time when business as we now understand it, was very young and, presumably, very innocent.

Measures of reform should normally, of course, be initiated and carried out, not in times of depression, but in times of comparative prosperity. That is obvious. Indeed, I suppose that ideal and timely measures of reform might avert a depression by removing the causes of it. But we never have worked ideally, and probably we never will. So if, through lack of reform, depression follows, the next best thing is to introduce reform as soon as the conditions of the depression will permit. I did not have a chance to effect reforms before the days of the depression. I will be perfectly candid and tell you that, in those days, I doubt whether anyone fully realized the need of reform. How much I wish that in this country or in the world there had been a man with vision to see the abyss upon which we were rushing and with power of action to arrest the movement. I say, I did not have a chance before the depression. This is my first opportunity. I am determined to take it. In fact, I have seized upon it already, as will soon be disclosed to you.

Steps Taken Toward Recovery

Now, let me say a word about the measures which the Government adopted during the depression to help the people and all those agencies of business which were designed to serve you. And I had better admit that I am somewhat at fault for not having talked before to you about these measures. It may not have been quite fair to all our loyal supporters. It may not have been quite fair to you, to have remained so long silent. My only excuse is that I have been so fully occupied with my daily duties and with my plans for your future, that I have had no time to talk about our actions in the past. In any case, they speak for themselves.

But I would not be just to my Government and to those who have supported it, if I did not say definitely, and without fear of honest contradiction, that during these terrible times we have served your interests as well as any government in the world has served the interests to which it was pledged. Our recovery measures have been veritable bulwarks against the fury of the depression. To test their value in a spectacular way, you can ask yourselves what would have been the condition of this country now without guidance and direction and the right sort of support from the State. If you will consider the condition of some other countries, you will easily be able to answer this question. As I say, the Government's emergency programme has not been excelled by any other in the world. To me, the clearest proof of the effectiveness of our recovery measures lies in the fact that they have carried us through the depression and today have brought about a degree of improvement in conditions, which alone makes possible the introduction of our programme of reform.

I shall take an early opportunity to fully and accurately inform you, by speeches and through published documents, of all that this Government has done. We will render the strictest account of our stewardship. We shall indeed be proud to do so. Tonight, and in my speeches following, I want more especially to talk of the present and the future.

The Tragedy of Youth

This economic system of ours is something that most of us have never stopped to think very much about. Before the War there was no great occasion to. After the War, when the system was rushing uncontrollably toward the 1929 abyss, I imagine there was not many who were much concerned. Now, alas, we have reason enough to worry; and still more reason, therefore, to do our best to end the cause of all this worry and trouble and to free our minds for happier things. It is a tragedy of these times that men and women, boys and girls, whose minds should be given to constructive pursuits, find themselves handicapped and harassed by the uncertainties of life, and prevented, by the anxieties of this present situation, from giving their best to the things which are most worth while.

But it is now necessary that we give further, and the most careful, thought to our economic system, so that we may the better appreciate its capacity to serve us in the conditions in which we live today. Our best interest leaves us no alternative. We will examine the system without prejudice of any sort. We neither hate nor love it. It is here to do you service. That is its only purpose. If it has failed, then we must change it. Quite properly, we have a regard for those things with which we have long been beneficially associated, but allegiance to a system does not involve our condonation of its defects. Possibly some of you will maintain that, because the system has served us well in the past, there is a presumption in favour of its continuing to do so in the future. But clearly, that is no proof that it will do so. Indeed, present conditions are surely proof enough that it will not. And, as I say, if it does not serve us, we must reform it. There is no conceivable justification for maintaining in its old form any agency designed to promote the happiness and welfare of the people when change in it will more surely achieve that essential purpose.

But Times Have Changed

I do not intend to trouble you just now with the history of the capitalist system. But, in my opinion, it is important that you should carefully examine the origin of capitalism, its place in the early days, and the theory upon which it operated. It would be helpful to a clearer understanding of some of our present diffulties if you were to trace the development which carried the system from the simple practice of a simple theory to the complex practice of a theory strained and wrenched out of its original form. You would then see that for the old checks and balances which ensured the proper working of the original system, the system today has provided no counterpart within itself. You would agree that free competition and the open market place, as they were known in the old days, have lost their place in the system, and that the only substitute for them, in these modern times, is government regulation and control. You would understand that past depressions were caused by maladjustments in the operation of this system, and were corrected only after intense suffering and hardship, that these depressions were so many crises, dangerous and difficult to surmount, but that, in comparison with them, this depression is a catastrophe, and therefore demands the intervention of the Government. If you examine this capitalist system, you would appreciate more fully some of the facts which underlie the transcendent fact that times have changed, that old conditions are no more, that something new has come into our social and economic life, and that this new element, this new force, insistently demands recognition. And I am compelled to add, you would realize more clearly the folly of some men who try to ignore this irresistible truth.

I do not have to determine how far these crises were incident to the inexorable march of progress, or how far they were brought about by the failure of capitalism to attune itself to this forward movement. Nor is it necessary for us to pass judgment on the question of whether this current depression would have occurred had the capitalist system, in the last decade or two, been directed by supermen, compounded wholly of wisdom and saintliness. The truth is that in all times, faults in the system have been seized upon by the unscrupulous and greedy as vantage points in their battle for self-advancement. And we will be dealing with the matter in a thorough and practical way if we remove these faults, so as to put a final stop to the unfair practices which they made possible.



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