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Economy

Federal mismanagement to blame for Canada’s immigration backlash

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15 minute read

From the Macdonald Laurier Institute

By Sonia Orlu for Inside Policy

Canada’s welcoming attitude towards newcomers makes it one of the most sought-after places to live in the world. However, this image is being tested by a growing backlash against immigration. Immigrants make up 23 per cent of the population, yet economic, social, and cultural anxieties are increasingly challenging the country’s commitment to diversity. More than four-in-ten Canadians now agree – either strongly (23 per cent) or somewhat (21 per cent) – with the statement, “There is too much immigration to Canada.” It is crucial to understand that this backlash is not rooted in opposition to immigration or immigrants themselves, but rather in frustration over mismanagement and inadequate planning by the federal government. It reflects a growing unease about the country’s economic outlook, raising urgent questions about how Canada can uphold its values while addressing legitimate and pressing concerns.

Public reactions and political responses

Canadian political leaders have generally maintained a measured tone on immigration, focusing on economic pressures and service delivery rather than hostility toward immigrants. However, tensions are rising, and a thoughtful debate is increasingly needed.

Prime Minister Justin Trudeau has accused the Conservative Party of spreading misinformation to stoke fears about immigration. Such remarks risk alienating those with legitimate critiques of his administration’s policies and practices. Conservative Leader Pierre Poilievre has linked immigration to housing shortages, criticizing Trudeau’s policies as disconnected from infrastructure needs. This aligns with public frustrations over housing availability and the need for better coordination between immigration levels and capacity. Quebec Premier François Legault echoed similar sentiments, raising issues of resource management and culture. His critics accuse him of xenophobia, but dismissive responses like Immigration Minister Marc Miller’s remark that people are “always blaming immigrants” overlook genuine challenges and deepen frustration.

These exchanges illustrate the delicate balance required in navigating immigration policy and public sentiment. Canadians’ attitudes toward immigration are more nuanced than a simple pro- or anti-immigration divide. Most Canadians aren’t driven by fear or racism; rather, they are focused on how immigration impacts housing affordability, strains public finances, and increases job competition. While apprehension about immigration levels is growing, attitudes toward immigrants themselves remain largely positive. In fact, more than four-in-ten Canadians (42 per cent) say that immigrants make their community a better place, with fewer than one-in-ten (9 per cent) feeling that they make it worse. Still, public concerns must be addressed to prevent further polarization.

The housing crisis: a catalyst for frustration

A significant driver of the immigration backlash is the housing crisis. The Canada Mortgage and Housing Corporation (CMHC) reported in 2024 that Canada needs an additional 3.5 million housing units by 2030 to restore affordability. Cities like Toronto and Vancouver have seen housing prices soar, partly due to increased demand from population growth.

The “housing theory of everything” highlights how housing affects multiple societal issues – such as economic inequality, social mobility, and political polarization. Immigration is no exception. Housing shortages drive up costs, deepen inequality, and create competition between immigrants and long-term residents, eroding social trust and cohesion.

The rise in temporary residents, including international students and temporary foreign workers, compounds these issues. Immigration, Refugees and Citizenship Canada (IRCC) reports that the number of temporary residents increased by over 50 per cent from 2017 to 2022 and continued to rise sharply  into 2024. This influx contributes to increased demand in the rental housing market, particularly in urban centres with large universities, driving up prices and reducing availability.

The Trudeau government’s ambitious plan to admit nearly 500,000 new permanent residents annually by 2026 marks one of the highest per-capita immigration rates globally. By comparison, Canada admitted around 200,000 landed immigrants per year in the 1990s and 250,000 per year in the early 2010s. Without matching investments in infrastructure and housing, these elevated immigration levels – often referred to as “mass immigration” – could exacerbate housing shortages, strain public services, and heighten public frustration. Internal documents from Immigration, Refugees, and Citizenship Canada revealed that as early as 2022, officials warned that large increases in immigration could worsen housing affordability and strain public services. Yet, no substantive steps were taken by the government to revise its targets.

Given the realistic timelines for development, it is improbable that infrastructure can keep pace with rapid population growth. The construction industry faces labour shortages, regulatory hurdles, and lengthy timelines for project completion – often several years. The CMHC maintains that due to these complexities, expecting cities to rapidly scale up infrastructure to meet immediate demands is unrealistic.

If these housing issues are not resolved, public frustration could escalate, potentially shifting from concerns about immigration policy to resentment toward immigrants themselves.

Cultural integration: balancing diversity and cohesion

Economic challenges, such as housing affordability, often intersect with social and cultural anxieties. As communities experience rapid change and strained resources, questions arise about society’s ability to integrate newcomers without compromising its social fabric. While only about 4 per cent of Canadians express fears that immigration weakens local culture and identity, concerns about the effectiveness of integration are more widespread. In fact, approximately half of Canadians are concerned that some immigrants may not be adopting Canadian values or fully participating in the broader community. When asked which values immigrants should adopt, Canadians often prioritize language proficiency and respect for the country’s history and culture, highlighting the importance placed on cultural integration. Interestingly, both native-born and foreign-born Canadians largely agree on the values newcomers should embrace, indicating a shared vision for integration.

Canada’s sense of nationhood is deeply tied to its history of migration and its commitment to cultural and ethnic diversity. However, diversity is not inherently beneficial in all forms; its value depends on whether it leads to greater tolerance, creativity, or economic growth. When cultural and ethnic diversity is celebrated without deliberate efforts to foster interaction and promote unity, it risks becoming fragile. Poorly managed diversity can lead to social fragmentation, lower trust, and weakened civic engagement.

The challenges of integration are well-documented. Language barriers, different social norms, and unfamiliarity with Canadian institutions can make it difficult for immigrants to fully integrate. This can sometimes lead to the formation of cultural enclaves, where newcomers find comfort in communities with shared backgrounds but have limited interaction with the broader society. While these enclaves provide crucial support, they can inadvertently hinder full participation in Canadian life. Sociologist Robert Putnam found that, in the short term, diversity can reduce social capital and lower community engagement, particularly when institutions fail to promote integration – a concept he refers to as “hunkering down.” In such cases, both newcomers and long-term residents may feel isolated.

Despite these challenges, diversity, when managed effectively, can yield benefits. Exposure to different cultures fosters creativity, innovation, and economic growth, even though research suggests that immigration itself is neither inherently good nor bad for the economy. Cities like Toronto and Vancouver have thrived in part due to their multicultural populations, which have helped them become global hubs for technology and the arts. Additionally, evidence shows that successful integration is common in Canada. Many immigrants actively embrace Canadian valuescontribute to the economy, and participate in civic life. The majority of eligible immigrants become Canadian citizens, demonstrating a strong commitment to their new country. Many immigrants choose Canada precisely because they align with its principles of democracy, equality, and respect for human rights. Cultural integration, in the end, is a dynamic process – one that, when approached thoughtfully, strengthens rather than weakens the social fabric.

Bridging policy failures with sustainable solutions

Addressing public frustrations with immigration requires a serious reassessment of the policies that have exacerbated these concerns.

First and foremost, tackling the housing crisis through integrated planning is essential. Governments should incentivize affordable housing development and reform zoning laws to allow for higher-density projects. Recognizing the realistic timelines for construction and development, planning must begin immediately and be synchronized with immigration targets. Public sentiment strongly supports this approach. A recent Nanos Research survey found that 72 per cent of Canadians want to reduce immigration levels until housing becomes affordable.

Aligning immigration levels with the country’s capacity is crucial. Dynamic targets based on real-time economic data and infrastructure development would ensure that immigration aligns with Canada’s ability to provide services and opportunities. Returning to historical admission levels of 200,000 to 250,000 immigrants per year could help ease pressure on housing and public services. Adjusting the composition of immigration streams is equally important.

Temporary measures – such as pausing or reducing programs for international students and temporary foreign workers – could relieve immediate pressures while infrastructure catches up. For instance, although international students contributed over $30 billion to the economy in 2022, lowering their numbers could help reduce housing demand in university towns. Likewise, managing temporary foreign worker intake would address labour shortages without overwhelming resources.

Effective integration and support services must also be given priority. This should begin with implementing consistent selective immigration measures that evaluate an applicant’s potential to integrate both economically and culturally into Canadian society. Such measures would reduce reliance on extensive post-arrival support and help ease cultural tensions. According to a 2018 Angus Reid survey, two-in-three Canadians believe that greater emphasis should be placed on screening for alignment with Canadian values. However, it’s important to note that defining “Canadian values” can be subjective and risks being perceived as discriminatory.

Improvements to post-arrival services like community centres offering language classes, job search support, and cultural orientation programs are necessary to significantly ease the transition for newcomers. Research shows that when immigrants are effectively integrated, they are more likely to find employment, increasing tax contributions and reducing their reliance on social services. Additionally, well-integrated immigrants are more likely to engage in civic life, fostering social cohesion and strengthening community resilience.

Cultural diversity, while valuable, cannot be assumed to sustain itself without active support. Integration is not just about where people live or demographic representation; it also involves cultivating a shared sense of purpose and belonging. Successful integration depends on a reciprocal relationship: immigrants need the resources and opportunities to succeed, and in turn, they must engage with and contribute to the broader societal and cultural framework. Without deliberate policies that encourage community engagement, cross-cultural dialogue, and mutual respect, there is a risk that cultural diversity will falter.

Finally, responsible political discourse is crucial. Leaders must choose their words carefully, as rhetoric shapes public perceptions. By fostering nuanced and empathetic dialogue, they can bridge the gap between public concerns and policy realities, preserving national unity.

Canada stands at a crossroads. While immigration has long been one of our greatest assets, the current backlash highlights cracks in its management. This is not a rejection of immigrants – it’s a call for better policies and improved management. High immigration levels without careful planning will continue to harm our society. Our leaders now face a choice: fan the flames of division or unite the country around meaningful, evidence-based solutions.


Sonia Orlu is a Ph.D. student in Political Science at Simon Fraser University and a commentator on politics and culture. She is a contributing writer to the Macdonald-Laurier Institute.

Business

Worst kept secret—red tape strangling Canada’s economy

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From the Fraser Institute

By Matthew Lau

In the past nine years, business investment in Canada has fallen while increasing more than 30 per cent in the U.S. on a real per-person basis. Workers in Canada now receive barely half as much new capital per worker than in the U.S.

According to a new Statistics Canada report, government regulation has grown over the years and it’s hurting Canada’s economy. The report, which uses a regulatory burden measure devised by KPMG and Transport Canada, shows government regulatory requirements increased 2.1 per cent annually from 2006 to 2021, with the effect of reducing the business sector’s GDP, employment, labour productivity and investment.

Specifically, the growth in regulation over these years cut business-sector investment by an estimated nine per cent and “reduced business start-ups and business dynamism,” cut GDP in the business sector by 1.7 percentage points, cut employment growth by 1.3 percentage points, and labour productivity by 0.4 percentage points.

While the report only covered regulatory growth through 2021, in the past four years an avalanche of new regulations has made the already existing problem of overregulation worse.

The Trudeau government in particular has intensified its regulatory assault on the extraction sector with a greenhouse gas emissions cap, new fuel regulations and new methane emissions regulations. In the last few years, federal diktats and expansions of bureaucratic control have swept the auto industrychild caresupermarkets and many other sectors.

Again, the negative results are evident. Over the past nine years, Canada’s cumulative real growth in per-person GDP (an indicator of incomes and living standards) has been a paltry 1.7 per cent and trending downward, compared to 18.6 per cent and trending upward in the United States. Put differently, if the Canadian economy had tracked with the U.S. economy over the past nine years, average incomes in Canada would be much higher today.

Also in the past nine years, business investment in Canada has fallen while increasing more than 30 per cent in the U.S. on a real per-person basis. Workers in Canada now receive barely half as much new capital per worker than in the U.S., and only about two-thirds as much new capital (on average) as workers in other developed countries.

Consequently, Canada is mired in an economic growth crisis—a fact that even the Trudeau government does not deny. “We have more work to do,” said Anita Anand, then-president of the Treasury Board, last August, “to examine the causes of low productivity levels.” The Statistics Canada report, if nothing else, confirms what economists and the business community already knew—the regulatory burden is much of the problem.

Of course, regulation is not the only factor hurting Canada’s economy. Higher federal carbon taxes, higher payroll taxes and higher top marginal income tax rates are also weakening Canada’s productivity, GDP, business investment and entrepreneurship.

Finally, while the Statistics Canada report shows significant economic costs of regulation, the authors note that their estimate of the effect of regulatory accumulation on GDP is “much smaller” than the effect estimated in an American study published several years ago in the Review of Economic Dynamics. In other words, the negative effects of regulation in Canada may be even higher than StatsCan suggests.

Whether Statistics Canada has underestimated the economic costs of regulation or not, one thing is clear: reducing regulation and reversing the policy course of recent years would help get Canada out of its current economic rut. The country is effectively in a recession even if, as a result of rapid population growth fuelled by record levels of immigration, the GDP statistics do not meet the technical definition of a recession.

With dismal GDP and business investment numbers, a turnaround—both in policy and outcomes—can’t come quickly enough for Canadians.

Matthew Lau

Adjunct Scholar, Fraser Institute
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Business

‘Out and out fraud’: DOGE questions $2 billion Biden grant to left-wing ‘green energy’ nonprofit`

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From LifeSiteNews

By Calvin Freiburger

The EPA under the Biden administration awarded $2 billion to a ‘green energy’ group that appears to have been little more than a means to enrich left-wing activists.

The U.S. Environmental Protection Agency (EPA) under the Biden administration awarded $2 billion to a “green energy” nonprofit that appears to have been little more than a means to enrich left-wing activists such as former Democratic candidate Stacey Abrams.

Founded in 2023 as a coalition of nonprofits, corporations, unions, municipalities, and other groups, Power Forward Communities (PFC) bills itself as “the first national program to finance home energy efficiency upgrades at scale, saving Americans thousands of dollars on their utility bills every year.” It says it “will help homeowners, developers, and renters swap outdated, inefficient appliances with more efficient and modernized options, saving money for years ahead and ensuring our kids can grow up with cleaner, pollutant-free air.”

The organization’s website boasts more than 300 member organizations across 46 states but does not detail actual activities. It does have job postings for three open positions and a form for people to sign up for more information.

The Washington Free Beacon reported that the Trump administration’s Department of Government Efficiency (DOGE) project, along with new EPA administrator Lee Zeldin, are raising questions about the $2 billion grant PFC received from the Biden EPA’s National Clean Investment Fund (NCIF), ostensibly for the “affordable decarbonization of homes and apartments throughout the country, with a particular focus on low-income and disadvantaged communities.”

PFC’s announcement of the grant is the organization’s only press release to date and is alarming given that the organization had somehow reported only $100 in revenue at the end of 2023.

“I made a commitment to members of Congress and to the American people to be a good steward of tax dollars and I’ve wasted no time in keeping my word,” Zeldin said. “When we learned about the Biden administration’s scheme to quickly park $20 billion outside the agency, we suspected that some organizations were created out of thin air just to take advantage of this.” Zeldin previously announced the Biden EPA had deposited the $20 billion in a Citibank account, apparently to make it harder for the next administration to retrieve and review it.

“As we continue to learn more about where some of this money went, it is even more apparent how far-reaching and widely accepted this waste and abuse has been,” he added. “It’s extremely concerning that an organization that reported just $100 in revenue in 2023 was chosen to receive $2 billion. That’s 20 million times the organization’s reported revenue.”

Daniel Turner, executive director of energy advocacy group Power the Future, told the Beacon that in his opinion “for an organization that has no experience in this, that was literally just established, and had $100 in the bank to receive a $2 billion grant — it doesn’t just fly in the face of common sense, it’s out and out fraud.”

Prominent among PFC’s insiders is Abrams, the former Georgia House minority leader best known for persistent false claims about having the state’s gubernatorial election stolen from her in 2018. Abrams founded two of PFC’s partner organizations (Southern Economic Advancement Project and Fair Count) and serves as lead counsel for a third group (Rewiring America) in the coalition. A longtime advocate of left-wing environmental policies, Abrams is also a member of the national advisory board for advocacy group Climate Power.

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