Ernest Brown was one of the many who suffered personal financial tragedy due to the ups and downs of Alberta's capitalist economy and the power that gave the rich and powerful. He left behind boxes of writings on politics, economics and the suffering and losses suffered by the weak. I have reprinted some of this information in this blog.
He was one of Edmonton's foremost photographers before WWI. The WWI economic slump in Edmonton impoverished him. He ran as a candidate of the Independent Labour Party in 1921, joined the Communist movement, published a newspaper on political/economic analysis and the suffering of the unemployed, and pressed for monetary reform along the lines of Social Credit and socialism.
He had personal experience in the self-serving machinations of Edmonton's wealthy and well-connected, having lost his substantial brick business building on Jasper Avenue to their shenanigans.
He left behind boxes of writings (now in the Provincial Archives of Alberta) on what happened. Here are some excerpts:
Warning: The following paragraphs outline maneuvers by the rich and powerful to grab more wealth from the weak and trusting. The information is intended to be used by those seeking to be able to recognize chicanery and fight it, not for those who intend to perpetuate it on others.
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Ernest Brown noted that the innovation of limited liability corporations in 1900 lead to massive capital concentration. He tried to float a limited liability corporation himself and sent man to England to sell stocks. He wired back that the time was not opportune and two months late the war started.
1914 the assessment of Edmonton real estate (the base amount of city real estate) was $192M. (Many cold not pay the tax on their properties.)
W.T. Henry was mayor.
Wood, Gundy and Company agreed to sell Edmonton bonds on certain conditions, one of which was a tax sale. Henry obtained from the members of the provincial Legislature permission to hold the sale. A sale was held. Out of 110,000 lots then comprising the city, 85,000 were sold. They were mostly sold to McDougall & Secord, Imperial Bank, Credit Foncier, loan companies and H.M.E. Evans.
[The McDougall of McDougall & Secord was John A. McDougall, no connection to the McDougall Church, which was named after a different family in early Edmonton.
John A. McDougall was an early trader and merchant in Edmonton back in the 1870s. He went on to be powerful and wealthy, not all of it, according to Brown, obtained in perfectly moral ways. Town alderman 1893-4, twice elected mayor 1897 and 1908, Liberal MLA 1909-1913, president of Edmonton Board of Trade. Died in Edmonton in 1928.
Subject of MacGregor's Book Edmonton Trader.
John A. McDougall School is named in his honour. (Should it perhaps be re-named?)]
The full details of this sell-out I deal with in my “Story of Edmonton Tax Sale.”
The point is that I and many other individuals who had helped build the city were sold out by the city officials for being in arrears of taxes. The assessment was brought down from the $192M to $160M to $100M and even as low a figure as $56M.
In short we were sold out on an assessment of 3.5 times of what it was after the loan companies had obtained possession of the property.
[But the city was de-populated and the land was worthless. The new owners did not pay demanded taxes even at the lower assessment. Amid the slump they suffered financial problems themselves.]
Former Members of the Legislature, high civic officials and prominent men met untimely deaths by the “accidental discharge of a gun,” by cerebral hemorrhage,” misadventure in taking overdose of “sleeping tablets” etc. These men were saved the trouble of fighting an iniquitous situation....
following the war of 1914-18 the soldiers began to return from overseas.
1921-23 there was crescendo of unemployment, bread lines in every city, town and village, Canada with around 2 M unemployed.
I associated myself with unemployed and was of material assistance to them.
Jan. 1924 the city proposed cutting wages of civic employees 10 per cent. I protested and presented to them a method of “City script,” [currency produced and distributed by the city itself]. I found the densest ignorance prevailed among the aldermen on the subject of money, money substitutes, or the function of money.
To the aldermen the unemployed were ‘bums,’ ‘never sweats,’ ‘weary willies,’ etc. If they wanted work they could always get it, one alderman stated, He would make them work for an handouts the city gave, even if it was just piling bricks and pulling them down again.
Another said he had been broke many times but was always able to provide for ‘his little woman.’ Later he took two revolvers, stood with his back to the river, shot himself and fell into the river... [This may have been reference to Kenny Blatchford, alderman 1922-1923, who died in 1933. His body found in the river. It is generally thought he suffered nervous breakdown due to the contentious KKK-influenced 1932 election.]
April 29, 1933 I mailed to Social Credit leader William Aberhart at Calgary a copy of what I had prepared for the city of Edmonton. In August 1936. (after the election of Aberhart's party to power) the SC government put into circulation stamped scrip under the name Prosperity Certificates.
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Ernest Brown wrote of how the government's lack of regard for its workers, farmers and ordinary families meant that the population of the country was slow to grow.
He wrote that his point was also made by the Dec. 14, 1896 Edmonton Bulletin (as reprinted in the "30 years ago" column in the Dec. 14, 1926 Edmonton Bulletin).
"While Canada has been spending millions of dollars to attract to her shores a more or less desirable immigration from Continental Europe and systematically and, as a matter of policy, ignoring the disposition and destination of her own overflow population, the railway companies of the Northwestern States have pursued an active and successful immigration policy in eastern Canada, diverting the emigration that should have, and would naturally have, filled up the North West to rival fields south of the line, building rival communities of our own best blood and brain...
It is time that Canada awakened to the true reason for the slow growth of the North West and changed her land and immigration policy accordingly. The North West has not filled up because our own people have during he last 20 years gone to fill up the NW tier of the Western States, instead of the Canadian North West in the proportion of not less than five to one. It is time we ceased making a wonder out of something that is as plain as noonday to every citizen of ordinary intelligence and experience - only that he does not want to see it.
It is time the conspiracy of silence was broken."
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To help break this "conspiracy of silence," Brown went on with his recap of the government and economic policy that had been so disastrous for workers and farmers in Canada.
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"From 1904 to 1914 was a time of building of great railway systems subsidized by the government. Hundreds of miles of track have since been taken up. It was a time in which our school boards spent money like a 'drunken sailor' on large and elaborate school buildings far beyond the demands of the times or the requirements of the present-day. City councils were just as lavish in their expenditures while businesses expanded themselves and farmers and private individuals are not far behind.
Come 1914, bankers and loan companies called a halt. Bonds became due. Taxes were increased to meet them. Mortgage payments were demanded.
The sins we had done, one by one, we had to pay two by two.
August 1914 and the War long foreseen by the larger financial institutions managed by older men, fell like a bombshell into the camp of the younger businessmen and small investors. Legislation, or rather orders-in-council, were rushed through for big businesses to save them, one bank being rescued to the tune of $40M. All banks' paper "promises to pay" were made legal tender. The City of Edmonton sinking fund was cleaned out and "I.O.U.'s" put in their place.
The insurance companies and mortgage loan companies began to make a killing, first on the city dweller, then on the farmer.
The then mayor of Edmonton applied to the provincial Legislature and after much lobbying obtained permission for a[nother] tax sale. 80,000 out of a total of 110,000 city lots were offered for sale and sold for non-payment of taxes, not to new owners but to the city itself. Some few Jasper Avenue lots and other lots went to ones who were already large property owners or to the parasites who were loudest in support of the mayor for the tax sale. [These lots were purchased for close to nothing. It is reported that one person bought two lots for $15 on one occasion. (source: Memories of Bonnie Doon). By the late 1940s each of these lots was worth more than $1000. Those with deep enough pockets could afford to wait for that to happen, and thereby made their fortunes. Meanwhile though, business languished.]
Subdivisions were cancelled and reverted to farm lands. The City still held 45,000 lots in 1945.
The First World War drags on its weary pace but like all things must come to a finish.
1919-1920, the soldiers who had gone to fight to make the world "safe for democracy" returned to the city to find that, although they were supposed to have protection for a moratorium, found to their dismay they had lost their homes by a technicality - the tax sale.
The loan companies, baulked for a time by myself and others from getting foreclosure through the courts, took advantage of one of the generous clauses in their mortgage. They appeared at the Land Titles Offices and made affidavit that the taxes had not been paid, demanded and received title in their companies' name. And that was that.
The mayor's several applications to the province for the tax sale, the 64-page newspapers containing the description of the daily sales, the names of the purchasers, etc, are interesting documents to leave to posterity.
If at some future date, someone suggests erecting a monument to one of the early leaders of society or captains of industry, they should look at a truthful "Who's Who and Why" to learn if their wealth came by trading a bottle of whisky for a half-breed's scrip or by the tax sale route, or both.
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The basis of the wealth, laws broken or bent, morals shattered, are an important indicator of the prestige of a person. Today a despicable rise to wealth, revealed after so many years of being a family's guilty secret, could be cause enough to ask for removal of a memorial to a previously-honoured "early leader of society or captain of industry."
Thanks for reading.
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