The Alberta Social Credit Party in Alberta
The Canadian social credit movement was largely an out-growth of the Alberta Social Credit Party. The Social Credit Party of Canada was originally strongest in Alberta, before developing a base in Quebec when Réal Caouette agreed to merge his Ralliement créditiste movement into the federal party. The British Columbia Social Credit Party formed the government for many years in neighbouring British Columbia, although this was effectively a coalition of centre-right forces in the province that had no interest in social credit monetary policies. The party won a majority government in 1935, barely months after its formation, and remained in power until 1971. It has held no seats since 1982, and finished a distant seventh in the 2012 general election.
William Aberhart, a Baptist pastor and evangelist in Calgary, was attracted to social credit theory while Alberta was in the depths of the Great Depression. He soon began promoting it via his radio program on CFCN in Calgary, adding a heavy dose of fundamentalist Christianity to C.H. Douglas‘ original ideology. The basic premise of social credit—that all citizens have the right to the wealth they jointly produce—was especially attractive to farmers sinking under the weight of the Depression. Numerous study groups devoted to the theory sprang up across the province, which united into the Social Credit League of Alberta.
Rise to power
From 1932 to 1935, Aberhart tried to get the governing United Farmers of Alberta to adopt social credit. When the 1935 UFA convention voted against adopting Social Credit and UFA Premier Richard Reid rejected the proposals as being outside the province’s constitutional powers, Aberhart entered Social Credit candidates in the that year’s provincial election. There was widespread discontent with the overly cautious direction of the UFA government, and in some cases, local UFA chapters openly supported the Social Credit candidates. The UFA government was also reeling from a scandal that had forced Reid’s predecessor, John Brownlee, to resign a year earlier. This, in particular, caused some socially conservative UFA members to transfer their allegiance to the Christian-based Social Credit movement.
In the August 22, 1935 election, much to its own surprise, Social Credit won a landslide victory, taking 54% of the vote and winning 56 of the 63 seats in the Legislative Assembly. The only elected opposition was five Liberals and two Conservatives. The UFA lost all of its seats in the worst defeat for a sitting provincial government in Canada.
The Socreds’ expectations for the elections were so low that they hadn’t named an official leader during the campaign. With the win, Social Credit had to choose a leader who would become the province’s new premier. Aberhart was the obvious choice, but he initially said he didn’t want the office. However, he was finally prevailed-upon to take power, and was sworn in as premier on September 3. He entered the Legislative Assembly a year later in a by-election.
The first year and a half in power was a period of adjustment for the newly elected SC MLAs and their premier. Negotiations between Aberhart and Major Douglas, who had been hired by the UFA as a financial advisor, were colourful but unproductive. Aberhart, consumed with details of governance and administration, had little opportunity to progress along the Social Credit monetary reform road. After election he hired an orthodox financial expert named Magor, much to Douglas’s displeasure, thus forestalling radical monetary reform. In March 1937 many SC MLAs revolted against Aberhart’s leadership, refusing to pass the provincial budget until Aberhart promised serious reform of the banking system.
Not “funny money”
Following the 1937 revolt, the government made a serious attempt to implement social credit policies. It passed several pieces of radical populist legislation, such as the issuance of prosperity certificates to Alberta residents (dubbed “funny money” by detractors) in accordance with the theories of Silvio Gesell. Douglas, the originator of the Social Credit movement, did not like the idea of prosperity certificates, which depreciated in value the longer they were held, and openly criticized Gesell’s theories.
The Socreds also passed bills that would have placed the province’s banks under government control. However, Lieutenant-Governor John C. Bowen refused to grant Royal Assent to the bills. The Supreme Court of Canada subsequently ruled the legislation unconstitutional because only the federal government can legislate on banking.
Bowen also refused Royal Assent to the Accurate News and Information Act, which would have forced newspapers to print government rebuttals to stories the Executive Council (cabinet) objected to. The government’s relationship with Bowen became so acrimonious that in 1938, Bowen even threatened to use his reserve powers to dismiss the government. In the end, Bowen chose not to take this extraordinary action, in part because the Socreds were so popular that they would have almost certainly been re-elected.
Thwarted in their attempt to gain control of Alberta’s private banks, Aberhart’s government gained a foothold in the province’s financial sector by creating the Alberta Treasury Branches in 1938. ATB has become a lasting legacy of Social Credit Party policies in Alberta, operating as of 2013 as an orthodox financial institution and crown corporation. It is today the only government-owned bank in North America that deals with the public.
The government, to uphold its election promise of allowing democratic control of the government, passed a law allowing for the recall of members of the Legislative Assembly by petition of constituents but then repealed the legislation when Aberhart himself became the target of a recall drive.
The government also enacted several socially conservative laws, notably one restricting the sale and serving of alcohol. It was one of the strictest such laws in Canada. For many years, commercial airlines could not serve alcohol while flying over Alberta.
As well, the government passed stronger labour legislation, such as a minimum wage law, and centralized the province’s school system.
Manning’s government was much more pragmatic. Under his leadership, the party largely abandoned social credit monetary theories, though it did issue prosperity certificates from oil royalties in 1957 and 1958. His government was arguably one of the most conservative provincial governments in Canada. Manning moved to purge the party of anti-Semitism, which had been an element of its Christian populist rhetoric for years, but had become far less fashionable after World War II. Several socially conservative laws remained in place, such as the ban on airlines serving alcohol over provincial airspace.
Under Manning, Alberta became a virtual one-party state, winning seven consecutive elections. The party usually won well over 50 percent of the popular vote, and rarely faced more than ten opposition MLAs. He wielded considerable influence over the party’s federal counterparts as well. For example, he let it be known that his province would never accept francophone Catholic Real Caouette, leader of the party’s Quebec wing, as the party’s leader—even though Caouette headed the party’s third-strongest faction (behind the Alberta and British Columbia Socreds). This led to rumours that Caouette actually defeated Robert N. Thompson for the federal party’s leadership in 1961, only to be vetoed by Manning and the Alberta Socreds.
The discovery of significant reserves of oil in 1947 transformed Alberta from one of Canada’s poorest provinces to one of the country’s richest with resource revenues pouring into the government’s treasury.
Manning’s last election win, in 1967, proved ominous for the party. Despite winning 55 of the 65 seats in the legislature, it won less than 45% of the popular vote—its lowest share of the popular vote since 1940. More importantly, the once-moribund Progressive Conservatives, led by young lawyer Peter Lougheed, won six seats, mostly in Calgary and Edmonton. Despite having wide support in Calgary and Edmonton (Manning himself represented an Edmonton riding), Social Credit was at bottom an agrarian-based party, and never really lost this character. The party didn’t react nearly fast enough to the changes in Alberta as Calgary and Edmonton gained more influence.