• U.S.

CANADA: Refinance & Raptures

3 minute read

The Canadian Province of Alberta last week defaulted payment of $3,200,000 principal on two matured 6% bond issues issued in 1916, thus became the first Canadian Government to welsh on a financial obligation. Elected on a platform promising ”$25 a month dividends to every citizen.” Alberta’s sanctimonious, bulb-eyed Premier William C. Aberhart explained: “We haven’t the money. I’m sorry.” Fact was that ”Bible Bill” Aberhart had inherited a $150,000,000 load of indebtedness from his predecessors, had only $140,000 with which to make an interest “token payment” on the two defaulted issues. Social Crediteer Aberhart decided to pay no token.

Conceivably, Premier Aberhart might have maintained Alberta’s financial honor by borrowing from the Dominion Treasury, which has already lent Alberta $26,000,000. Conceivably. Dominion Finance Minister Charles Avery Dunning might have exercised his right to use Dominion dollars to pay off Alberta’s debts. Neither Premier nor Finance Minister chose such a course. “Bible Bill” Aberhart evidently was loath to give the Dominion additional financial reins on his Social Credit government. As for Finance Minister Dunning, he washed his hands of Alberta’s de-fault, observing: “If Social Credit is sound and good, it will prevail. But I don’t know what Social Credit is. I may be dense.” That was the way Alberta’s bondholders felt when, on the heels of the default, Premier Aberhart rushed through its first two readings a bill enabling his government to convert its entire $160,000,000 indebtedness into a non-maturing stock issue paying 2½% interest. Best financial thought on this maneuver considered it a newfangled way to scare investors silly, then offer to refinance their holdings at reduced interest rates. Premier Aberhart’s second maneuver was to introduce this week a bill giving Alberta cities the same right to refinance their indebtedness; his third a resolution to apply to the Dominion for a charter for the Province’s own bank.

Since the outright abolition of interest is a major tenet of Social Credit, Alberta was evidently not yet prepared to go the whole Social Credit hog. This came as no surprise to Social Credit’s founder, British Major Clifford Hugh Douglas, who has also washed his hands of Alberta.

In addition to being Alberta’s unpredictable head man. Premier Aberhart is head of Calgary’s Prophetic Bible Institute. Last fortnight he protested against being called a religious fanatic on the basis of an utterance made in 1917, when reporters understood him to say the Last Trump was at hand. “Let me say that Jesus is not coming in 1936 or 1937 or 1938 or 1939 or 1940 or 1941,:” Premier Aberhart firmly told newshawks. “Have you got that clear? . . . Now listen carefully. Seven years before the coming of Christ, the raptures shall take place. This will be when the Lord appears in the clouds. The raptures have not taken place yet.”

More Must-Reads from TIME

Contact us at letters@time.com