Canada is now preparing to tax the rich in its budget. 3 graphs that show why the country is angry
Canadians are angry.
Prime Minister Justin Trudeau’s Liberals are decimated in the polls after 10 years of leadership and a galloping affordability crisis.
Here are some graphs that illustrate why:
1) Immigration levels
h/t @donnelly_brent
Even 2 or 3 years ago, I would never have believed that Canadians would turn so much against immigration, but it is real and intense and it is because increasing the population by 3% per year has broken the country’s infrastructure and real estate markets.
2) There is only one growing sector: the public sector
Today is budget day and would be a good time to shrink the public sector. Is this going to happen? No chance.
3) Housing costs
Today’s Canadian CPI report showed that all of the inflation in the country is coming from rents and rising mortgage rates. The dream of home ownership has died for many – perhaps the majority – of Canadians under 30, and this cohort has shifted to the right in a way that few Western democracies have seen in decades. generations.
Let me tell you, this chart doesn’t even show how bad the situation is in many parts of the country. Urban boomers are largely living in $1.5 million to $2 million homes that they bought for $50,000 and are not downsizing. A very modest starter home in Canada costs +$600,000 in places where the vast majority of the country lives and there’s nothing like a booming homebuilding industry anywhere.
So what’s coming next?
Today is budget day and the plan is to tax the rich and corporations while adding $40 billion in new spending. Radio-Canada reports that it is those whose income exceeds $300,000 who pay the bill, while we do not know exactly how much other companies will have to pay. Oil companies could also face a windfall profits tax.
Trudeau promises to more than double (if not triple) the annual rate of housing construction, but few believe this is possible given the lack of construction capacity in the country. Additionally, given the pace of immigration, this likely won’t be enough since CIBC estimates that the country would need to almost quadruple the pace of housing construction.
The budget is due at 4 p.m. ET.
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