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Trudeau’s Christmas Gifts to Canadians: Unaffordable Housing, Inaccessible Health Care, Out-of-Control Immigration and Sagging Productivity

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From the C2C Journal

By Gwyn Morgan

On Tuesday Statistics Canada reported that Canada’s population leapt by 430,635 people from July through September of this year, after previously reporting that our nation added 1,050,110 people in 2022. That was the largest such annual number ever recorded and the nation’s highest percentage growth rate since 1957. The ostensibly non-political federal agency proclaimed this result as “certainly cause for celebration.” Ninety-six percent of the growth came from international migration. People accepted as new permanent residents accounted for 437,000 of those immigrants, while 613,000 were classified as non-permanent. In November, the federal government announced plans to grant permanent residency to 465,000 this year, with a goal of half a million by 2025. Combined with a high rate of non-permanent arrivals – such as students and temporary foreign workers – this means Canada will continue to have by far the highest immigration rate of any G7 country.

The Justin Trudeau government says we need all those immigrants to make up for a chronic shortage of skilled workers. Permanent immigrants fall into four broad acceptance categories: economic (and, thus, presumably skilled), family reunification, refugees and protected persons, and a final category described as “humanitarian, compassionate and others.” Economic immigrants make up about 60 percent of the total.

1.1 million per year, nearly 450,000 in the last quarter alone: The Justin Trudeau government vows to continue inviting new immigrants at record rates, allegedly to fill shortages of skilled workers, yet private-sector job creation in Canada is lagging, and many immigrants appear to go straight into government work. (Sources of photos: (top) Diary Marif; (middle) Michael Charles Cole/CBC; (bottom) JHVEPhoto/Shutterstock)

But before one jumps to the conclusion that our immigration system is working as it should, providing Canadian companies large and small from coast to coast with the skilled employees they would otherwise lack, one must pose this question: how many of those skilled immigrants are simply being added to the already massive number of federal, provincial and municipal government employees? The answer to that question is alarming.

A study by the Fraser Institute, released one month ago, with the revealing title Government-sector job growth dwarfs private-sector job growth across Canada, found that governments added far more employees than the private sector in all ten provinces between February 2020 and June 2023 – a period spanning from just before the pandemic set in, across the hard times of Covid-19, and onward for a year after it faded. During this time, the number of government jobs increasing by 11.8 percent compared to just 3.3 percent in the private sector – a whopping total of 446,000 government bureaucrats added.

There’s no doubt that immigrants are needed to help fill shortages of workers in some categories and certain regions. But more than 1 million per year? Of whom tens if not hundreds of thousands have probably ended up on the public payroll, i.e., going straight to being consumers of public resources rather than ever being productive contributors.

Canada’s immigration policy should be (but isn’t) considering two stark realities: a serious housing shortage/price crunch and a disintegrating health care system. Both situations – it’s no exaggeration to call them crises – are getting worse every day. While some housing markets are plagued by chronically slow construction, a lack of home building isn’t the main culprit. Last year actually saw a new national record set for housing starts at 320,000 units. Yet even that is far less than what’s needed to house our surging population.

Further, Canada’s population has been increasing by 600,000 or more every year for the past five years, while housing starts are typically far lower than the 2022 record – meaning we are falling ever-farther behind on housing. The Trudeau government’s much-boasted-about Housing Accelerator Fund has been a dismal failure. A recent article in Policy Magazine noted that Canada faces a housing shortfall of 3-4 million units by 2030. While high interest rates, zoning and NIMBYism are all playing roles, the article warns: “Historically high immigration levels will push up demand and drive up housing prices and rental rates across the country.”

While this seems to have all escaped the notice of Trudeau, even some of Canada’s elite are starting to catch on. Last week Tiff Macklem, the hapless Bank of Canada governor whose dithering helped heighten Canada’s pandemic-induced inflation to crisis levels, noted in a speech at Toronto’s Royal York Hotel that, “Canada’s housing supply has not kept up with growth in our population, and higher rates of immigration are widening the gap.”

While housing starts hit all-time records in 2021 and 2022, the new construction was subsumed beneath Canada’s surging population; the national housing shortfall is growing every year and projected to reach 3-4 million units by 2030. (Source of graph: Canadian Politics and Public Policy)

As bad as Canada’s housing situation is, health care is even worse – and deteriorating rapidly. A bulletin two weeks ago from public policy think-tank Second Street reported that more than 17,000 Canadians died while waiting for surgery or diagnostic scans in a one-year period straddling 2022-2023. Second Street’s figure is based on a series of Freedom of Information requests. It was an increase of 64 percent since 2018 and a five-year high.

Because many provincial health authorities provide incomplete data, Second Street believes the true figure is actually much worse: nearly 31,400 preventable deaths. The deceased victims had waited as long as 11 years for treatment. These horrific results are further evidence that Canada’s healthcare system is failing even to tread water and can be described as disintegrating or even collapsing. The situation is quite literally deadly. “We’re seeing governments leave patients for dead,” says Second Street’s president, Colin Craig.

And yet, incomprehensibly, the Trudeau government decided 2022 was the time to bring in nearly 1.1 million newcomers, and vowed to continue immigration flows at similar rates for years. And, as I pointed out near the end of this recent article, the published immigration figure is on top of 550,000 student visas and 600,000 work permits for temporary foreign and “international mobility” workers. Many of these workers are semi-skilled or completely unskilled and go straight to work in fast food or other low-paid services. How could any sane government follow such a foreseeably disastrous path?

“We’re seeing governments leave patients for dead”: According to Colin Craig (left), president of public policy research organization Second Street, the catastrophic state of Canada’s health care is likely responsible for over 30,000 preventable deaths-while-waiting per year. (Sources of photos: (middle) The Canadian Press/Nathan Denette; (right) Shutterstock)

During my long career in the energy sector, our company faced numerous existential challenges (not least how to survive the disastrous “Trudeau Number One’s” National Energy Program). I realized that two essential and entwined priorities were to do whatever it took to retain our highly proficient employees while also reining in expenditures as much possible – keeping the company both solvent and capable. We also developed a priority list for increasing capital expenditures to resume growing when conditions improved (much of which had to do with getting rid of Trudeau Number One). In such a situation, continuing to hire and spend would have been a path to certain disaster.

Sadly for our benighted country, the Trudeau government has done exactly that, following a path that has brought us to the brink of national disaster in several critical areas at once. Now, our unprecedented housing crisis has resulted in even job-holding and fully functional Canadians camping long-term in vehicles and tents. Fellow citizens are suffering and dying on health care waiting lists while being forbidden to access private care by federal legislation (and some provincial policies), with Canada’s courts often siding with government when challenged. And yet the Trudeau government has reconfirmed an immigration goal of half a million permanent residents with no lessening of non-resident immigrants that together will add another 1 million-plus newcomers in 2024.

Down and down: While Canada’s aggregate gross domestic product (GDP) continues to expand weakly, the metric that really counts – real GDP per individual Canadian – has been plunging and is projected to keep falling, signalling a weakening standard of living. (Sources: (photo) Pexels; (graph) TD Canada)

It’s hard to comprehend how much worse Canada’s housing and health care crises will get under these toxic policies. But they most assuredly will.

Adding to these self-inflicted wounds, our country now faces economic stagnation. While Canada’s aggregate (or “headline”) gross domestic product (GDP) has continued to increase, though weakly, the metric that really counts – GDP per individual Canadian – has stalled. Per capita GDP is critical because it is closely tied to individual income; to over-simplify slightly, workers can’t earn more if they don’t produce more. And here the situation is dire. “Real GDP per capita has contracted over the last three quarters,” states a July 15 report from TD Economics. “Longer term, the OECD projects that Canada will rank dead last amongst OECD members in real GDP per capita. Without fundamental changes, Canada’s standard-of-living challenges will persist well into the future.”

The key to producing more (without simply working more hours) and, hence, to earning more, is to increase the productivity of workers. And that is driven by private-sector capital investment in buildings/infrastructure, machinery/equipment, processes, software and other “intellectual capital,” research-and-development, and anything else that allows workers to increase their output without working more hours. Part of that increased output can be returned to workers in the form of higher compensation. That is how “real” wages grow without spurring inflation.

And in this critical dynamic, Canada has been lagging the U.S. and even Europe for over 20 years. Today our GDP per hour worked is stalled out and may actually be regressing. The TD Economics report cited above forecasts that this key metric will continue to experience “persistent contractions” at least throughout 2024. Meaning Canada’s shortfall in productivity – and personal income – versus the U.S. and leading European countries will continue to increase.

No longer a gap, a chasm: Canada’s invested capital per worker, once comparable to that of the U.S., has fallen dramatically since the Trudeau Liberals came to office in 2015. Says the C.D. Howe Institute: “Businesses see less opportunity in Canada and [this] prefigures weaker earnings and living standards.” (Sources: (photo) The Canadian Press/Paul Chiasson; (graph) TD Canada)

A report last year from the CD Howe Institute, Decapitalization: Weak Business Investment Threatens Canadian Prosperity, points out that the invested capital per worker, key to a country’s ability to produce goods and services, “has been weak since 2015” – the year the Trudeau government came into office. “Before 2015, Canadian business had been closing a long-standing gap with the U.S.,” the report states, before warning, “Since 2015, the gap has become a chasm.” The report’s ominous conclusion: “Having investment per worker much lower in Canada than abroad tells us that businesses see less opportunity in Canada and prefigures weaker earnings and living standards.”

The stark reality is that those millions of hopeful immigrants entering Canada will find a country not only unable to provide health care and housing for its citizens and temporary residents, but also with a diminishing overall standard of living. And a national government that doesn’t seem to care.

Gwyn Morgan is a retired business leader who was a director of five global corporations.

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Top Brass Is On The Run Ahead Of Trump’s Return

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From the Daily Caller News Foundation

By Morgan Murphy

With less than a month to go before President-elect Donald Trump takes office, the top brass are already running for cover. This week the Army’s chief of staff, Gen. Randy George, pledged to cut approximately a dozen general officers from the U.S. Army.

It is a start.

But given the Army is authorized 219 general officers, cutting just 12 is using a scalpel when a machete is in order. At present, the ratio of officers to enlisted personnel stands at an all-time high. During World War II, we had one general for every 6,000 troops. Today, we have one for every 1,600.

Right now, the United States has 1.3 million active-duty service members according to the Defense Manpower Data Center. Of those, 885 are flag officers (fun fact: you get your own flag when you make general or admiral, hence the term “flag officer” and “flagship”). In the reserve world, the ratio is even worse. There are 925 general and flag officers and a total reserve force of just 760,499 personnel. That is a flag for every 674 enlisted troops.

The hallways at the Pentagon are filled with a constellation of stars and the legions of staffers who support them. I’ve worked in both the Office of the Secretary of Defense and the Joint Chiefs of Staff. Starting around 2011, the Joint Staff began to surge in scope and power. Though the chairman of the Joint Chiefs is not in the chain of command and simply serves as an advisor to the president, there are a staggering 4,409 people working for the Joint Staff, including 1,400 civilians with an average salary of $196,800 (yes, you read that correctly). The Joint Staff budget for 2025 is estimated by the Department of Defense’s comptroller to be $1.3 billion.

In contrast, the Secretary of Defense — the civilian in charge of running our nation’s military — has a staff of 2,646 civilians and uniformed personnel. The disparity between the two staffs threatens the longstanding American principle of civilian control of the military.

Just look at what happens when civilians in the White House or the Senate dare question the ranks of America’s general class. “Politicizing the military!” critics cry, as if the Commander-in-Chief has no right to question the judgement of generals who botched the withdrawal from Afghanistan, bought into the woke ideology of diversity, equity and inclusion (DEI) or oversaw over-budget and behind-schedule weapons systems. Introducing accountability to the general class is not politicizing our nation’s military — it is called leadership.

What most Americans don’t understand is that our top brass is already very political. On any given day in our nation’s Capitol, a casual visitor is likely to run into multiple generals and admirals visiting our elected representatives and their staff. Ostensibly, these “briefs” are about various strategic threats and weapons systems — but everyone on the Hill knows our military leaders are also jockeying for their next assignment or promotion. It’s classic politics

The country witnessed this firsthand with now-retired Gen. Mark Milley. Most Americans were put off by what they saw. Milley brazenly played the Washington spin game, bragging in a Senate Armed Services hearing that he had interviewed with Bob Woodward and a host of other Washington, D.C. reporters.

Woodward later admitted in an interview with CNN that he was flabbergasted by Milley, recalling the chairman hadn’t just said “[Trump] is a problem or we can’t trust him,” but took it to the point of saying, “he is a danger to the country. He is the most dangerous person I know.” Woodward said that Milley’s attitude felt like an assignment editor ordering him, “Do something about this.”

Think on that a moment — an active-duty four star general spoke on the record, disparaging the Commander-in-Chief. Not only did it show rank insubordination and a breach of Uniform Code of Military Justice Article 88, but Milley’s actions represented a grave threat against the Constitution and civilian oversight of the military.

How will it play out now that Trump has returned? Old political hands know that what goes around comes around. Milley’s ham-handed political meddling may very well pave the way for a massive reorganization of flag officers similar to Gen. George C. Marshall’s “plucking board” of 1940. Marshall forced 500 colonels into retirement saying, “You give a good leader very little and he will succeed; you give mediocrity a great deal and they will fail.”

Marshall’s efforts to reorient the War Department to a meritocracy proved prescient when the United States entered World War II less than two years later.

Perhaps it’s time for another plucking board to remind the military brass that it is their civilian bosses who sit at the top of the U.S. chain of command.

Morgan Murphy is military thought leader, former press secretary to the Secretary of Defense and national security advisor in the U.S. Senate.

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For the record—former finance minister did not keep Canada’s ‘fiscal powder dry’

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From the Fraser Institute

By Ben Eisen

In case you haven’t heard, Chrystia Freeland resigned from cabinet on Monday. Reportedly, the straw that broke the camel’s back was Prime Minister Trudeau’s plan to send all Canadians earning up to $150,000 a onetime $250 tax “rebate.” In her resignation letter, Freeland seemingly took aim at this ill-advised waste of money by noting “costly political gimmicks.” She could not have been more right, as my colleagues and I have written herehere and elsewhere.

Indeed, Freeland was right to excoriate the government for a onetime rebate cheque that would do nothing to help Canada’s long-term economic growth prospects, but her reasoning was curious given her record in office. She wrote that such gimmicks were unwise because Canada must keep its “fiscal powder dry” given the possibility of trade disputes with the United States.

Again, to a large extent Freeland’s logic is sound. Emergencies come up from time to time, and governments should be particularly frugal with public dollars during non-emergency periods so money is available when hard times come.

For example, the federal government’s generally restrained approach to spending during the 1990s and 2000s was an important reason Canada went into the pandemic with its books in better shape than most other countries. This is an example of how keeping “fiscal powder dry” can help a government be ready when emergencies strike.

However, much of the sentiment in Freeland’s resignation letter does not match her record as finance minister.

Of course, during the pandemic and its immediate aftermath, it’s understandable that the federal government ran large deficits. However, several years have now past and the Trudeau government has run large continuous deficits. This year, the government forecasts a $48.3 billion deficit, which is larger than the $40 billion target the government had previously set.

A finance minister committed to keeping Canada’s fiscal powder dry would have pushed for balanced budgets so Ottawa could start shrinking the massive debt burden accumulated during COVID. Instead, deficits persisted and debt has continued to climb. As a result, federal debt may spike beyond levels reached during the pandemic if another emergency strikes.

Minister Freeland’s reported decision to oppose the planned $250 onetime tax rebates is commendable. But we should be cautious not to rewrite history. Despite Freeland’s stated desire to keep Canada’s “fiscal powder dry,” this was not the story of her tenure as finance minister. Instead, the story is one of continuous deficits and growing debt, which have hurt Canada’s capacity to withstand the next fiscal emergency whenever it does arrive.

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