News release from The Audit 

By @davidclinton

Government decisions have consequences. But they also have reasons.

Dearest readers: I would love to hear what you think about this topic. So please take the very brief survey at the end of the post.

Popular opposition to indiscriminate immigration has been significant and growing in many Western countries. Few in Canada deny our need for more skilled workers, and I think most of us are happy we’re providing a sanctuary for refugees escaping verifiable violence and oppression. We’re also likely united in our support for decent, hard working economic immigrants looking for better lives. But a half million new Canadians a year is widely seen as irresponsible.

So why did Canada, along with so many other Western governments, choose to ignore their own electorates and instead double down on ever-increasing immigration rates? Whatever nasty insults we might be tempted to hurl at elected officials and the civil servants who (sometimes) do their bidding, I try to remember that many of them are smart people honestly struggling to be effective. Governing isn’t easy. So it’s worth cutting through the rhetoric and trying to understand their policies on their own terms.

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As recently as 2022, the government – as part of its Annual Report to Parliament on Immigration – claimed that:

“Immigration is critical to Canada’s economic growth, and is key to supporting economic recovery”

There you have it. It’s at least officially about the economy. To be fair, the report also argued that immigration was necessary to address labor shortages, support an aging domestic population, and keep up with our “international commitments”. But economic considerations carried a lot of weight.

Now what I’d love to know is whether the “immigration-equals-better-economy” assumption is actually true. It’d be a real shame if the receipts told us a different story, wouldn’t it?

One possible way to measure economic health is by watching per capita gross domestic product (GDP) growth rates. Insofar as they represent anything real, the inflation-adjusted GDP rates themselves are interesting enough. But it’s the rates by which GDP grows or contracts that should really capture our attention.

The green line in the graph below represents Canada’s (first quarter) GDP growth rates from the past forty years. To be clear, when measured against, say, its 1984 value, the GDP itself has trended upwards fairly consistently. But looking at changes from one year to the next makes it easier to visualize more detailed historical fluctuations.

The blue bars in the chart represent each year’s immigration numbers as a percentage of the total Canadian population. That rate leapt above one percent of the population in 2021 – for the first time since the 1960’s – and hasn’t shown any signs of backing down. Put differently, Canada absorbed nearly 12 immigrants in 2023 for every 1,000 existing residents.

Seeing both trends together in a single chart allows us to spot possible relationships. In particular, it seems that higher immigration rates (like the ones in 2018-2019 and 2022-2023) haven’t consistently sparked increases in the GDP.

With the exception of those COVID-crazed 2020 numbers – which are nutty outliers and are generally impossible to reliably incorporate into any narrative – there doesn’t ever seem to have been a correlation between higher immigration rates and significant GDP growth.

So, at best, there’s no indication that the fragile economy has benefited from that past decade’s immigration surge. As well-intentioned as it might have been, the experiment hasn’t been a success by any measure.

But it has come with some heavy social costs. The next chart shows the painful disconnect between an artificially rising population and a weak housing construction market. The blue bars, as before, represent immigration rates as a percentage of total population. This time, however, they go back all the way to 1961. The red line tells us about the number of single-detached housing starts per 1,000 people.

With the exceptions of the mid-1960’s and the past few years, each of the historical immigration surges visible in the graph was either preceded or accompanied by appropriate home construction rates.

As an anomaly, the 1960’s surge was for obvious reasons far less damaging. Back then you could still purchase a nice three-bedroom house in what’s now considered midtown Toronto for no more than two years’ worth of an average salary. I know that, because that’s exactly when, where, and for how much my parents bought the house in which I spent most of my errant youth. Those elevated immigration levels didn’t lead us into economic crisis.

But what we’re witnessing right now is different. The housing supply necessary to affordably keep us all sheltered simply doesn’t exist. And, as I’ve already written, there’s no reason to imagine that that’ll change anytime over the next decade. (Can you spell “capital gains tax inclusion rate change”? I knew you could.)

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Just to be complete, the disconnect doesn’t apply only to detached “built-to-own” houses. This next chart demonstrates that housing starts of all flavours – including rental units – grew appropriately in the context of historical immigration surges, but have clearly been dropping over the last couple of years.

Since housing starts data isn’t the only tool for measuring the health of a housing market, here’s a visualization of rental apartment vacancy rates in Canada:

The combination of a sluggish construction market and an immigration-fueled population explosion has been driving up prices and making life miserable for countless families. And things appear to be headed in the wrong direction.

So sure, immigration should play an important role in Canadian life. But by this point in the game, it’s pretty clear that recent government policy choices failed to reverse economic weakness and contributed to disastrous outcomes. Perhaps it’s time to change course.

Now it’s your turn. I hope you’ll take this very brief (and anonymous) survey.

Share your thoughts. Click to take the Immigration Policy survey.

Assuming we get enough responses, I’ll share the results later.

 

From the Daily Caller News Foundation

By Jason Hopkins

California lawmakers are one step closer to making hundreds of millions of taxpayer-funded home loans available to residents living in the country illegally.

Democrats on the California Senate Appropriations Committee unanimously approved AB 1840 to move forward on Thursday, according to an official vote tally of the legislation. The bill has one last chance to be struck down on the Senate floor, where Democrats wield majority power, before it lands on Gov. Gavin Newsom’s desk.

The legislation seeks to amend the California Dream For All Shared Appreciation Loan program, an initiative launched last year that provides first-time homebuyers with a loan of up to 20% of the house’s purchase price for down payment or closing cost. If passed and signed into law, illegal migrants living in California would be eligible to apply for a piece of the pie.

“Once again, California has chosen to prioritize illegal immigration and fiscal irresponsibility over the needs of its citizens, all while facing a $60 billion deficit that will ultimately be passed onto taxpayers,” San Diego County Supervisor Jim Desmond said in a statement provided to the Daily Caller News Foundation.

“California is in dire financial straits, yet lawmakers continue to prioritize programs that incentivize illegal immigration and strain local resources,” Desmond continued. “Expanding this program to include illegal immigrants is not just another handout — it’s a massive overreach that shifts the financial burden onto law-abiding taxpayers.”

These taxpayer-funded home loans are interest-free and borrowers are not required to dole out monthly payments, making the program incredibly popular with California residents.

When applications for the $300 million program first opened up in May 2023 — offering interest-free loans to roughly 2,300 middle and lower-income homebuyers — the money ran out in less than two weeks, according to the LA Times. State officials have since tightened eligibility for the program, requiring that at least one of the applicants be a first-generation home buyer and replacing the first-come-first-serve model with a lottery.

Despite California struggling to cope with a budget deficit in the tens of billions of dollars, and availability for the program incredibly tight already, one state lawmaker felt the loan program wasn’t inclusive enough.

Assemblymember Joaquin Arambula, a Democrat from Fresno, first introduced AB 1840 in January, with the goal of broadening the definition of “first-time home buyer” to include illegal immigrants. The lawmaker argued in March that the “social and economic benefits of homeownership should be available to everyone,” according to a local news KTLA. Arambula did not immediately respond to the the DCNF’s request for comment.

The legislation has since easily passed the Democrat-dominated California Assembly and sailed through the Senate Appropriations Committee — with opposition exclusively relegated to GOP lawmakers.

“California’s budget deficit continues to grow and Democratic lawmakers are so out of touch with everyday Californians that they and are quite literally taking money away from law-abiding citizens, their own constituents, and handing it over as a free gift to people who broke federal law to cross the border illegally,” California Sen. Brian Dahle stated to the DCNF.

“There’s no accountability and transparency when it comes to the Democrats’ spending sprees, and it’s unfortunate because many Californians see homeownership as nothing more than an illusion at this point,” Dahle continued.

California is experiencing a massive budget shortfall.

State lawmakers in June approved a budget that slashed spending and temporarily raised taxes on businesses in an effort to shore up a nearly $50 billion budget deficit, according to the Associated Press. The dire financial situation marks a far cry from the more than $100 billion surplus the state enjoyed roughly two years ago, but those revenue spikes proved only temporary as rising unemployment, inflation and a slowing of the tech industry has battered California pocketbooks.

The state’s deficit was roughly $ 32 billion in 2023, which grew to more than $46 billion earlier this year and is now around $60 billion, according to California Republicans — drawing questions as to why lawmakers would open up a highly-coveted loan program to a large swath of the population that does not hold legal status.

Nearly two million illegal migrants live in California, according to data published by the Pew Research Center in July.

It’s not immediately clear if Newsom will sign the legislation. When reached for comment, a spokesperson said the governor’s office does not typically comment on pending legislation, adding that the governor would “evaluate the legislation on its merits” should it reach his desk.

Approval of AB 1840 came on the same day that Vice President Kamala Harris’ campaign announced she would be unveiling a proposal similar to her home state’s current program: $25,000 in down payment support for first-time homebuyers, including greater support for first-generation homeowners.

It’s not clear if the proposal from Harris — who has recently attempted to cast herself as more of a border hawk — would explicitly exclude illegal immigrants. Her campaign did not respond to a request for comment from the DCNF.

California Republicans, in the meantime, are left balking at their own state’s legislative actions.

“Many legal California residents can’t afford a home in their own state,” California Sen. Brian Jones said to the DCNF. He is one of only two GOP members on the Senate Appropriations Committee.

“Instead of addressing the housing crisis, radical Democrat lawmakers want to help illegal immigrants buy houses with the gift of taxpayer funds,” Jones continued. “With a $62 billion budget deficit, we need to focus on preserving essential government functions, not unfair political spending for those here illegally.”