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Canada can’t have fast population growth, housing supply constraints, and housing affordability

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1 year ago

8 minute read

From the MacDonald Laurier Institute

By Steve Lafleur

No one wants to solve the housing crisis enough to make the hard choices.

It’s tempting to try to have it all and policymakers are not immune to this. There are tradeoffs in everything. Ignoring those tradeoffs might work for awhile, but eventually reality catches up to you. Try as we might, we can’t have it all.

For instance, we can’t have rapid population growth, housing supply constraints, and housing affordability all at the same time. We’ll call this the housing affordability trilemma.

The idea of a policy trilemma comes from the Mundell-Fleming model which is included in most introductory economics textbooks. The model was named after Canadian economist Robert Mundell and British economist Marcus Fleming, who developed the idea in the early 1960s. The basic premise of the model, also called the “impossible trinity” or “trilemma” is that you can have two of three policies, but not all three (namely, free capital flow, a fixed exchange rate, and a sovereign monetary policy).

The idea of an impossible trinity can and has been applied to other situations, like the euro crisis in the early 2010s, and provides a useful way of looking at seemingly intractable problems. Plotting the related problems on a Venn Diagram helps visualize the problem. Here is the Mundell-Flemming model, visualized.

(Source: Author’s creation, graphic recreated)

Now, let’s return to housing policy. Few Canadian problems are as intractable as the now nationwide housing affordability crisis. Rents are rising quickly, apartment availability is falling, and home prices are the highest relative to incomes in the G7. As we’ve shown in a recent paper for the MacDonald Laurier Institute, Canada’s population growth is outstripping housing growth. This, unsurprisingly, has undermined housing affordability. Let’s visualize this trilemma.

(Source: Author’s creation, graphic recreated)

At the root of Canada’s housing woes is a severe shortage of homes relative to the number needed. We simply don’t build enough homes to adequately house current and future Canadians.

Not only is there cross-party consensus that there’s a housing shortage, but most parties in provincial and federal elections have proposed policies aimed at addressing it. So why do we still have a shortage?

Let’s go through the elements of the Canada’s housing trilemma (or housing impossibility trinity).

The first element is a fast-growing population. Canada has the fastest growing population in the G7, and last year alone grew by more than a million people. Barring any major shifts in immigration policy, this trend is unlikely to change any time soon. Indeed, the population grew by 430,635 in the third quarter of 2023. That’s the highest quarterly growth rate since 1957.

The second element is restrictions on homebuilding. Whether intended or not, a suite of policies processes and regulations that prevent or limit the addition of more homes both in existing neighbourhoods and at the urban fringe. Barriers to density include local zoning bylaws, lengthy and uncertain consultation processes, and growth plans that exclude building or upgrading the infrastructure necessary to enable more homebuilding in existing neighbourhoods. Policies explicitly preventing the addition of homes outside of existing neighbourhoods include Ontario’s Greenbelt and British Columbia’s Agricultural Land Reserve, while softer versions include local planning targets limiting the share of development slotted to occur on city outskirts. Given these limitations, it’s no surprise that we’ve rarely surpassed 200,000 housing completions annually since the 1970s, while the rate of population growth has reached generational highs.

The third element is housing affordability. That is, the ability for individuals and families earning local incomes to comfortably meet their housing needs. This means shelter costs don’t prevent them from feeding and clothing themselves, but also allow saving and investing in an education, for instance. For example, some peg the cut-off for affordability at 30 percent of income. By that measure, a household would require an income of over $100,000 to afford a one-bedroom apartment in Vancouver, for example.

Whether we like it or not, we can’t have fast population growth, rigid housing supply constraints, and housing affordability all at the same time.

For most of our recent past, the choice we’ve collectively made is to accelerate population growth while maintaining many (if not most) restrictions on both outward and upward growth, meaning we’ve excluded the possibility of achieving broad affordability. The consequences? All the symptoms mentioned before: rising rents, falling vacancies, higher ownership costs.

Despite recent pivots by a growing number of local and provincial governments, the balance of housing and land-use policies remains firmly tilted against reaching the level of homebuilding we need to restore some semblance of affordability, which by some estimates means more than doubling homebuilding. To wit, housing construction has remained remarkably stagnant—even slightly declining—in recent decades. Even the bold changes to zoning recently passed in British Columbia, Ontario and Nova Scotia are unlikely to double the number of housing built provincewide.

But, as the housing trilemma suggests, there are alternative routes. If Canadians remain adamant about affordability, we can demand more meaningful reduction or removal of policies preventing a growth in housing supply, or we can demand a reduction in population growth, or both. These are not easy choices but ignoring them doesn’t make them go away. We need to build upwards, outwards, or both, in order to meaningfully increase housing production. We can’t say no to every solution and expect better results.

The point is, there’s broad consensus that Canada faces a housing crisis, and that major policy actions are needed to fix the problem. There’s also a tacit consensus that the policies feeding the crisis should remain in place.

To put it more bluntly, everyone wants to solve the housing crisis, but no one wants to solve the housing crisis enough to make the hard choices. Until we collectively shift our priorities, we are choosing to sacrifice housing affordability. We can’t have it all. If we insist on maintaining fast population growth and restrictions on supply, we’ll get the broken housing market we deserve.

Steve Lafleur is a public policy analyst who researches and writes for Canadian think tanks.

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Mark Carney is trying to market globalism as a ‘Canadian value.’ Will it work?

Published on April 4, 2025

By

From LifeSiteNews

By Frank Wright

A campaign to appeal to national sentiment is a strange gambit for Liberals – committed as they are to the replacement of the nation with globalist policies.

The storm over Donald Trump’s threatened tariffs over the Canadian border crisis has been baked into a vote-winning meme by Canada’s Liberal Party. Yet with an election only weeks away on April 28, can a sentimental appeal to a vanished Canada secure a win for Mark Carney?  

Trump’s tariffs were expected to hit Canada on Wednesday’s “Liberation Day,” refueling a furor over Canadian sovereignty which has led some to say this is “shaping up to be the trade war election.”

Responding to the tariffs, which ultimately never came to fruition in the way the Liberals were warning, a meme war broke out with Carney responding to harsh reality with a feelgood slogan.  

“Elbows up!” is the new Current Thing in Canada, a media craze designed to stir nationalist indignation in elderly voters who may even remember the 1950s origin of the phrase.  

The elbows refer to those of Gordie Howe – a 1950s hockey legend from Saskatchewan – a conservative province – and from a time when Canada was populated by Canadians.  

It bears all the hallmarks of an “astroturf” campaign – intended to look authentic, but in reality a manufactured mass belief for marketing purposes. 

“Elbows up” seeks to inspire a fighting mood against the threat – or promise – of tariffs on Canadian trade with the U.S.  

Carney will ‘cave’

It is a classic example of the manipulation of popular feeling into political allegiance. How will the feelings of aging voters affect the imposition of tariffs? Not at all. Nor will the Canadian Prime Minister be able to stop them.  

Silence over ‘devastating’ Chinese tariffs caused by Trudeau

Why? Carney has no alternative. He has already “caved” – to China – over the same issue. “Devastating” Chinese tariffs took effect over a week ago in Canada, as Global News reported:  

Canadian agricultural producers are warning of devastating impacts from new Chinese tariffs that began Thursday (March 20th), which they say will compound the economic strain from the U.S. trade war.

The tariffs are severe, and will have a dramatic impact – as China is Canada’s second-largest trading partner behind the United States. 

“China has imposed a 100 per cent levy on Canadian canola oil and meal, as well as peas, plus a 25 per cent duty on seafood and pork,” the outlet reported.  

These tariffs cannot be corrected by hockey memes, and are a response to tariffs placed on Chinese goods by Liberal Prime Minister Justin Trudeau. The Liberal Party – seeking election over outrage on tariffs – has created a tariff crisis, whose costs will be borne by the people who vote for them.  

There are no “elbows up” against China. In fact, their tariffs have been greeted with silence from Carney, who has said U.S.-Canada relations are at an end. 

Corruption, drug cartels in Canada

Anger at Donald Trump obscures the serious problems which prompted his suggestion that Canada could be absorbed into the United States. “Elbows Up” is a cool way of making Canadians look past the fact that the crisis they inhabit has been created by the Liberals and their globalist agenda. 

On February 1, Trump issued an executive order “Imposing duties to address the flow of illicit drugs across our northern border.”

Terry Glavin, writing in January for Canada’s National Post, dismissed Trump’s earlier claims of a crisis over Canadian “border security and drug trafficking” as a “pretext” for his “…declared objective of exerting ‘economic force’ to annex Canada as the 51st American state.” 

Yet this too appears to be a fantasy inspired by national sentiment – which simply ignores reality. 

As LifeSiteNews reported, Canada’s second bank has laundered over 18 trillion dollars in the U.S. and Canada for Mexican and Chinese drug cartels. The world’s largest fentanyl factory was discovered in Vancouver in February.    

Canada a ‘failed state’?

The serious issue of corruption by Chinese Triads combines with a picture of impotent Canadian law and border enforcement to suggest that Canada may be, as Glavin warned, “approaching failed-state status.” When the memes wear off, this is the reality faced by Canadian voters.  

Canadians have complained since 2017 that life is too expensive to have a family. 

Now “a generation” cannot afford a home, and many struggle to pay for groceries. Help is at hand, however.  

Their Liberal government supports Medical Assistance in Dying (MAID) – killing the elderly, poor and ill as healthcare – whilst promoting radical “gender” ideology to help sterilize children. 

Will Carney come to the rescue?  

Carney is a committed “Net Zero” fanatic, and is the kind of “Catholic” who fervently supports abortion.  

His moral integrity is demonstrated further by the fact that his $25 billion “green” investment fund was located in Bermuda to dodge Canadian taxes. 

As the Canadian Catholic Register cautions, “[Carney] is a well-connected globalist with deep ties to institutions such as the World Economic Forum, the United Nations, Bank for International Settlements, and the Financial Stability Board.” 

Globalist ‘Canadian’ values

National identity is a strange appeal to make on behalf of a party which appears to be working hard to replace Canadians with immigrants, and which is now lead by a globalist technocrat.  

It is the values of globalism, of course, which are presented to voters as “Canadian values”: open borders, LGBTQ “rights,” “gender” surgery and hormones for children, and the Net Zero deindustrialization program strongly supported by the Liberal leader Mark Carney.  

How long can this appeal to save the nation of Canada from foreign influence convince Canadians to vote for more of the same? The Liberal Party has led Canada into crisis, presiding over corruption so severe that its police, judicial and border authorities are deemed incapable of being trusted by the USA.   

This is not a charge made solely by the Trump administration, but also under Biden – with Antony Blinken pressing the matter of the insecurity of the Canadian border as far back as 2022. In the coming weeks, the real issues which have consigned Canada to a fond memory may well shrink the Liberal lead reported by the polls. 

What do the polls say?

With some headlines trumpeting an “eight point lead” for the Liberals, others show a narrower advantage for the globalist Carney – and one leading firm has them tied with the Conservatives. 

Abacus Data’s March 30 poll had both parties neck and neck at 39%. Abacus, who describe themselves as “Canada’s most sought-after, influential, and impactful polling firm,” “…were one of the most accurate pollsters conducting research during the 2021 Canadian election.”

A second poll shows a narrower lead, and a clear bonus for Carney for simply not being Justin Trudeau.  

338 Canada showed a four point lead for the Liberals on March 31, and its graph clearly illustrates that their lead relies on disaffected NDP voters – and the collapse of the Bloc Quebecois vote. 

Reality enters the chat 

With the issues at home now overtaking Trump and his tariffs, the cost of living and those allied to mass migration such as housing are returning to the forefront of voters’ minds. The issue of reality – and who is the real Mark Carney – may well overtake the fake nationalism of “Elbows up.”

A campaign to appeal to national sentiment is a strange gambit for Liberals – committed as they are to the replacement of the nation with globalist policies – and of its people through mass immigration. Carney has been powerless to halt Chinese tariffs. He is powerless to halt those of Donald Trump.  

If Canadians can see beyond cringe hockey memes these two issues are clearly a reaction to the actions and inaction of a Liberal-led Canada. This is the reason that Conservative leader Pierre Poilievre is campaigning on the harm done to Canadians by the “lost Liberal decade.” If Canadians can be persuaded by the argument presented by reality, it seems unlikely they will vote for another – whatever the polls may say.

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Business

‘Time To Make The Patient Better’: JD Vance Says ‘Big Transition’ Coming To American Economic Policy

Published on April 4, 2025

By

JD Vance on “Rob Schmitt Tonight” discussing tariff results

 

From the Daily Caller News Foundation

By Hailey Gomez

Vice President JD Vance said Thursday on Newsmax that he believes Americans will “reap the benefits” of the economy as the Trump administration makes a “big transition” on tariffs.

The Dow Jones Industrial Average dropped 1,679.39 points on Thursday, just a day after President Donald Trump announced reciprocal tariffs against nations charging imports from the U.S. On “Rob Schmitt Tonight,” Schmitt asked Vance about the stock market hit, asking how the White House felt about the “Liberation Day” move.

“We’re feeling good. Look, I frankly thought in some ways it could be worse in the markets, because this is a big transition. You saw what the President said earlier today. It’s like a patient who was very sick,” Vance said. “We did the operation, and now it’s time to make the patient better. That’s exactly what we’re doing. We have to remember that for 40 years, we’ve been doing this for 40 years.”

“American economic policy has rewarded people who ship jobs overseas. It’s taxed our workers. It’s made our supply chains more brittle, and it’s made our country less prosperous, less free and less secure,” Vance added.

Vance recalled that one of his children had been sick and needed antibiotics that were not made in the United States. The Vice President called it a “ridiculous thing” that some medicines invented in the country are no longer manufactured domestically.

“That’s fundamentally what this is about. The national security of manufacturing and making the things that we need, from steel to pharmaceuticals, antibiotics, and so forth, but also the good jobs that come along when you have economic policies that reward investing in America, rather than investing in foreign countries,” Vance said.

WATCH:

With a baseline 10% tariff placed on an estimated 60 countries, higher tariffs were applied to nations like China and Israel. For example, China, which has a 67% tariff on U.S. goods, will now face a 34% tariff from the U.S., while Israel, which has a 33% tariff, will face a 17% U.S. tariff.

“One bad day in the stock market, compared to what President Trump said earlier today, and I think he’s right about this. We’re going to have a booming stock market for a long time because we’re reinvesting in the United States of America. More importantly than that, of course, the people in Wall Street have done well,” Vance said.

“We want them to do well. But we care the most about American workers and about American small businesses, and they’re the ones who are really going to benefit from these policies,” Vance said.

The number of factories in the U.S., Vance said, has declined, adding that “millions of workers” have lost their jobs.

“My town [Middletown, Ohio], where you had 10,000 great American steel workers, and my town was one of the lucky ones, now probably has 1,500 steel workers in that factory because you had economic policies that rewarded shipping our jobs to China instead of investing in American workers,” Vance said. “President Trump ran on changing it. He promised he would change it, and now he has. I think Americans are going to reap the benefits.”

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