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Agricultural Debt Adjustment

Published online by Cambridge University Press:  07 November 2014

W. T. Easterbrook  and
W.B.H.
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Extract

The present paper is intended as the background to a more detailed discussion of the facts of agricultural debt adjustment. I propose to discuss briefly the nature and objectives of our machinery of agricultural debt adjustment, the background against which it works, and some of the more important difficulties encountered in practice. The observations are based largely upon experience acquired in the West, although the setting concerns the country as a whole.

Problems of debt adjustment are primarily problems in the economics of distribution. Measures taken in this direction affect transfers of income between individuals, groups, and sections of the country. Their chief objective is to relieve the pressure on exposed groups and to allay the tensions created thereby. They constitute a part of the machinery of adjustment so essential in an economy subject to extreme variation of income and afflicted with rigidities which obstruct or divert forces tending to equilibrium. The tendency has been to concentrate upon the economics of the long run and to ignore obstacles to the free play of such forces. The importance of these obstacles is most manifest in the lower phases of the business cycle, and the presence of corrective or compensatory measures is in large part due to the cumulative effects of the inflexibility characteristic of a continental type of development and to the difficulty of planning for an economy in which variability is so marked. The results are seen in a wide range of expedients of which debt adjustment is an example. Difficulties arise owing to the failure to distinguish between social and pecuniary costs, to the widely different interpretations of what the term “justice” implies, and to differences in points of view which range from an insistence upon a strictly legal interpretation of rights and obligations to demands for debt reductions upon the basis of present income.

Type
Articles
Information
Canadian Journal of Economics and Political Science/Revue canadienne de economiques et science politique , Volume 2 , Issue 3 , August 1936 , pp. 390 - 403
Copyright
Copyright © Canadian Political Science Association 1936

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References

1 See Innis, H. A., “Notes on Problems of Adjustment in Canada” (Journal of Political Economy, 12, 1935)CrossRefGoogle Scholar; also “Unused Capacity as a Factor in Canadian Economic History” (Canadian Journal of Economics and Political Science, 02, 1936).Google Scholar

2 See Mackintosh, W. A., Economic Problems of the Prairie Provinces (Toronto, 1935)Google Scholar, chap. ii.

3 See Statutes of Alberta, An Act for the Relief of the Southern Part of Alberta, 12 Geo. V (1922), c. 43; also An Act to Facilitate the Adjustment of Agricultural Debts, 13 Geo. V (1923), c. 43.

4 See Statutes of Alberta, An Act to Amend and Consolidate the Debt Adjustment Act, 21 Geo. V (1931), c. 57; 22 Geo. V, c. 18; 23 Geo. V, c. 13; 24 Geo. V, c. 11; An Act to Promote Stability in the Agricultural Industry, 25 Geo. V, c. 56, has since been repealed. See also 24 Geo. V, c. 36 “The Provincial Agricultural Debts and Credits Act”. Statutes of Saskatchewan, An Act to Facilitate the Adjustment of Agricultural Debts, 19 Geo. V (1928-9), c. 53; 21 Geo. V, c. 59; 22 Geo. V, c. 51; 23 Geo. V, c. 82; 24 Geo. V, c. 59; 25 Geo. V, c. 88; also An Act respecting the Limitation of Certain Civil Rights, 23 Geo. V, c. 83; 24 Geo. V, c. 60; 25 Geo. V, c. 89; see Britnell, G. E., “Saskatchewan, 1930-1935” (Canadian Journal of Economics and Political Science, 05, 1936).CrossRefGoogle Scholar Statutes of Manitoba, An Act to Facilitate the Adjustment of Debts, 21 Geo. V (1931), c. 7; 22 Geo. V, c. 8; 23 Geo. V, c. 9; 24 Geo. V, c. 9; 25 Geo. V, c. 11.

5 See Statutes of Canada, The Farmers' Creditors Arrangement Act, 1934, 24-25 Geo. V (1934), c. 53; 25 Geo. V, c. 20.

6 See Statutes of Canada, An Act respecting Certain Debts due the Crown, 17 Geo. V (1927), c. 51; 22-23 Geo. V, c. 18. Statutes of Alberta, The Tax Consolidation Act, 1927, 17 Geo. V (1927), c. 52; 18 Geo. V, c. 53; 20 Geo. V, c. 51; 25 Geo. V, c. 56. Statutes of Saskatchewan, The Tax Consolidation and Adjustment Act, 1934, 24 Geo. V, c. 30; 25 Geo. V, c. 41; also The Local Government Board (Temporary Special Powers) Act, 1934, 25 Geo. V, c. 86; 25 Geo. V, c. 87. Statutes of Manitoba, An Act respecting Certain Debts Due the Crown, 18 Geo. V (1928), c. 13; 19 Geo. V, c. 14; also an Act to Facilitate the Compromise of Debts of Farmers, 24 Geo. V, c. 10.

7 See Statutes of British Columbia, The Mortgagors' and Purchasers' Relief Act, 1932, 22 Geo. V, c. 35; 23 Geo. V, c. 43; 24 Geo. V, c. 49; and 25 Geo. V, c. 49. Statutes of Ontario, The Mortgagors' and Purchasers' Relief Act, 1932; 22 Geo. V, c. 49; 23 Geo. V, c. 35; 24 Geo. V, c. 33; and 25 Geo. V, c. 41, Statutes of Quebec, An Act to Suspend the Exigibility of Hypothecary and Other Claims, 23 Geo. V, c. 99; 24 Geo. V, c. 73; 25 Geo. V, c. 96, s. 4.

8 Cf. Bladen, V. W., “The Theory of Cost in an Economy based on the Production of Staples: The Case of Wheat” (The Canadian Economy and its Problems ed. Innis, H. A. and Plumptre, A. F. W., Toronto, 1934).Google Scholar

9 Concessions granted by the Soldier Settlement Board in the past, and under Saskatchewan's special debt adjustment plan, exemplify adaptations of this form of adjustment technique.

10 E.g., MacGregor, D. C., “The Problem of Public Debt in Canada” (Canadian Journal of Economics and Political Science, 05, 1936).Google Scholar