Canada has transformed from a prosperous nation where hard work led to homeownership and stability into an "asset economy" where wealth is primarily derived from owning assets, particularly real estate, leading to widespread financial precarity for younger generations.
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Picture this. It is 1995. You are a high
school teacher in a suburb of Toronto or
Vancouver. You drive a Honda Civic. You
have a modest pension. You decide to buy
a house. It's a nice house. Red brick,
three bedrooms, a big backyard with a
maple tree. It cost you $180,000.
It feels expensive. Sure, you have to
budget. You have to skip the fancy
vacations, but the math works. Your
salary covers the mortgage, the
groceries, and the gas with enough left
over to put some money away for a rainy
day. You're living the promise. You're
living in the boring, stable, prosperous
fortress of the North, Canada. Now, snap
your fingers. It is 2026. You're
standing in front of that exact same
house. The bricks are a little older.
The maple tree is a little bigger, but
now there is a for sale sign on the
lawn, and the asking price is $2.2
million. Inside that house, there is no
longer a single family. The basement has
been converted into a separate unit,
rented out to three international
students sleeping on mattresses on the
floor. The main floor is occupied by a
young couple, both professionals, both
making six figures, who are drowning in
so much debt that they are terrified to
have children. They are the same people
as that teacher in 1995. They did
everything right. They followed the
rules. But the game changed. We are
looking at a crime scene, but there is
no blood and there's no yellow tape.
There's just a polite, smiling country
that has quietly decided to eat its own
young. If you're under the age of 40 in
Canada, you are not crazy. You're not
lazy. You are the victim of a 40-year
economic experiment that has gone
catastrophically wrong. You are living
in a country that has stopped investing
in the future and started cannibalizing
the present. Today, we are going to peel
back the polite veneer of Canadian
society. We are going to look at the
math that the news anchors gloss over.
We are going to talk about the hidden
mechanism that turned a G7 industrial
power into a massive real estate hedge
fund with a flag. This is the story of
how the Canadian dream became a lucid
nightmare. Let's rewind. To understand
why you feel poor in a rich country, you
have to understand that the word rich
has changed its meaning. In the 20th
century, a rich country was a country
that made things. It was a country where
productivity went up, so wages went up.
It was a factory. In the 21st century,
Canada decided to stop being a factory
and start being a casino. The data is
screaming this at us if you know where
to look. If you look at the OECD
projections for the next 30 years, the
years that define your career and your
retirement, Canada is projected to be
the worst performing advanced economy on
the planet, dead last. Why? Because we
caught a disease. It is a specific
economic sickness called the
productivity trap. For the last 20
years, while the Americans were building
tech giants and the Asians were building
advanced manufacturing, Canadian
business decided to stop innovating. Why
invest $10 million in a new factory or a
new software startup or a new R&D lab
which is risky and hard when you can
just buy a plot of land, sit on it for 5
years and make a tax-free fortune. This
is the hidden mechanism, the asset
economy. We built an economy where it
pays more to own things than to do
things. Think about the psychological
toll of this. If you work a job, you pay
income tax. You pay payroll tax. You pay
sales tax. You contribute to society.
But if you bought a house in Kitalano or
the beaches in 2005, you earned more
money last year by sleeping in your bed
than a heart surgeon earned saving
lives. That house earned tax-free
capital gains. The surgeon paid 53%
marginal tax. The message the system
sends is clear. Labor is for suckers.
Asset ownership is for kings. And this
brings us to the villain of our story.
And in Canada, the villain isn't a
single person. It is a structure. It is
the oligopoly. If you walk into a
grocery store in the United States, you
have 50 choices. In Canada, you have
three. If you want a cell phone plan in
Europe, you pay €20 for unlimited data.
In Canada, you pay $80 for a data cap
that feels like it's from 2012. Canada
is essentially three mining companies,
five banks, and three grocery chains in
a trench code. These monopolies are
protected by the government. They are
shielded from foreign competition. This
is why you pay some of the highest fees
in the world for banking, for internet,
for air travel. This is the hidden tax
of living in Canada. Every time you tap
your card, a few percentage points are
siphoned off to a protected class of
shareholders who face zero competition.
So you have stagnant wages because of
low productivity and you have sky-high
costs because of the oligopies. That is
a squeeze. But it's not the death blow.
The death blow is the housing trap. All
right, we need to talk about the
decision Canada made around 2008 when
the rest of the world and housing
bubbles burst. Canada's didn't. We
patted ourselves on the back. We said,
"Look how stable our banks are." But we
didn't fix the problem. We doubled down.
We lowered interest rates to near zero
and we kept them there. We invited the
world's capital to park itself in
Canadian condos. We turned housing from
shelter, a basic human right, into a
speculative financial asset traded like
Bitcoin. And the result is a feudal
system. I use that word carefully.
Feudalism. A system where your status is
determined by your relationship to land.
If you are young in Canada today, your
financial destiny is not determined by
how hard you work or how smart you are
or what degree you have. It is
determined by one thing, the bank of mom
and dad. If your parents own a home,
they can leverage it. They can gift you
a down payment. You can enter the
castle. You become a member of the
landed gentry. If your parents rent, you
are a surf. You will spend 50, 60, maybe
70% of your after tax income paying off
the mortgage of someone else. You're
paying for their retirement with your
poverty. This is the intergenerational
war that nobody in Ottawa wants to admit
is happening. The baby boomers, and I'm
not blaming them individually. They just
played the game as it was written, are
sitting on trillions of dollars of real
estate wealth. They vote. They vote to
restrict supply. They vote to keep their
neighborhoods quaint and low density.
They fight every new apartment building
at the city council meetings. They are
pulling up the ladder, and the young
look up at that ladder, and they realize
it's gone. This leads to a phenomenon
called delayed adulthood. It's a polite
term for a tragedy. In the 1970s, the
average age of a first-time home buyer
was 25. Today, in the major cities, it
is pushing 37 or 38. That is a decade
and a half of lost time. Think about
what happens in those lost years. You
don't have kids because you don't have a
bedroom for them. Canada's fertility
rate has collapsed to 1.33, an all-time
low. We are literally dying out because
we made it too expensive to reproduce.
You don't start a business because you
can't take the risk. If you miss a rent
payment, you're homeless. So, you take
the safe, boring corporate job. You
stifle your own potential. You don't
move for a better opportunity because
you are terrified of losing your rent
control department. You are trapped in
place. This is how a dynamic young
country turns into a stagnant old
museum. And then we have to talk about
the accelerant. The policy that took a
fire and turned it into an inferno. The
population trap. For years, the Canadian
consensus was that immigration is an
unaloyed good. And culturally, it is.
Canada is a welcoming place. But
economics is about supply and demand. It
is cold, unfeilling math. In the last
few years, the Canadian government
decided to spike the population growth
rate to levels seen in sub-Saharan
Africa. We brought in over a million
people in a single year. But we didn't
build a million homes. We didn't build a
million hospital beds. We didn't build a
million seats on the geo train. We
brought in hundreds of thousands of
temporary residents and international
students. Many of these students were
sold a lie. Recruiters in India and
Nigeria told them, "Come to Canada. It's
the land of opportunity." They arrived
and they found themselves sleeping four
to a room in Bmpton or Suri, delivering
Uber Eats in the snow, paying exorbitant
tuition to strip mall colleges that
exist solely to print diplomas for
permanent residency applications. This
isn't immigration. It is a labor supply
shock. By flooding the market with
low-skilled labor, we gave the oligopies
a gift. Why invest in automation? Why
invest in productivity? Why raise wages?
You can just hire a desperate student
for minimum wage. This suppressed wages
for the working class and the youth
while simultaneously skyrocketing the
demand for rent. It was a wealth
transfer from the poor who rent and work
for wages to the rich who own assets and
hire labor. It is a policy that looks
progressive on a pamphlet but operates
like 19th century robber baron
capitalism in practice. So where does
this leave you? The 28-year-old in the
basement apartment. It leaves you in a
state of cognitive dissonance. You walk
past the luxury condos in Vancouver,
empty, owned by shell companies. You see
the grocery prices climbing every week.
You hear the politicians talking about
GDP growth. But GDP growth means nothing
if the population is growing faster than
the economy. That is called capital
dilution. The pie is getting slightly
bigger, but there are a million more
people at the table holding forks. Your
slice is getting smaller. Per capita,
GDP in Canada is falling. We are getting
poorer. And the debt, the debt is the
invisible chain around your neck.
Canadians are some of the most indebted
people on Earth. We bought into the lie
that debt is wealth. We used our houses
as ATMs. We leased cars we couldn't
afford. Now interest rates have
normalized. The era of free money is
over and the hangover is beginning. We
are seeing the rise of the negative
amortization mortgage. This is a
terrifying concept. It means you're
making your monthly payment, but the
payment isn't even covering the
interest. Your debt is growing every
month, even as you pay. You're a debt
slave in the truest sense of the word.
And the government, they are trapped,
too. They know the housing market is a
bubble, but they can't let it pop. Real
estate and construction make up such a
huge percentage of the Canadian GDP that
if housing crashes, the entire economy
evaporates. The banks would be
insolvent. The pension funds would
collapse. So, they have to keep it
propped up. They introduce 30-year
amortizations. They buy mortgage bonds.
They do everything they can to keep the
air in the balloon. This is the suicide
pact. To save the economy, they have to
sacrifice the young. To save the young,
they have to crash the economy. They
have chosen to sacrifice the young. This
is why you feel poor. Because in a very
real mathematical sense, the system is
extracting wealth from your future to
pay for the mistakes of the past. You
are paying for the health care of a
generation that didn't save enough. You
are paying for the infrastructure that
hasn't been updated in 40 years. You are
paying the rent that sustains the
lifestyle of the asset class. But here
is the warning. Here is where the story
pivots from tragic to dangerous. Look at
the brain drain. If you are a talented
engineer from Waterlue or a doctor from
McGill or a welder from Alberta, why
would you stay? You look south of the
border. You see the United States. It
has its problems. Huge problems. But you
can buy a house in Texas or North
Carolina for a third of the price of a
shack in Toronto. You can earn double
the salary in tech or medicine. The best
and brightest are voting with their
feet. They are leaving. And who is left
behind? The old, the indebted, and the
people who can't afford to leave. This
creates a death spiral. As the tax base
leaves, the taxes on those who remain
must go up, which drives more people to
leave. Canada is risking becoming a
boutique hotel for the global rich,
staffed by a permanent underclass of
temporary workers with a hollowedout
middle class wondering what happened to
the country they grew up in. It is a
polite apocalypse. There are no tanks in
the streets. There are just fleece signs
on the storefronts and moving trucks
heading for the border and a silent
creeping despair in the eyes of the
young. But this isn't just a Canadian
story. This is the story of the entire
western world just accelerated. Canada
is the laboratory. We are the test case
for what happens when you prioritize
financialization over production. We are
showing the world that you cannot build
a nation on selling latte art and condos
to each other. Eventually you run out of
money. So is there a way out? There is,
but it is painful. It requires breaking
the oligopies. It requires a massive
resoning of our cities to flood the
market with supply, crashing the price
of housing. It requires a tax code that
rewards work and punishes speculation.
It requires the political courage to
tell the older generation, "Your house
is not a retirement fund. It is a house.
And its value needs to come down so your
grandchildren can live." Until that
happens, the young will continue to feel
poor because they are poor. They are
asset poor in a world where assets are
everything. If you are watching this and
you feel that tightness in your chest
when you pay your rent or that
hopelessness when you look at real
estate listings, acknowledge it. It is
not in your head. It is in the ledger.
You are living through the great
de-leveling. The rich country narrative
is a ghost story. It's a memory of a
time before the factories closed and the
towers went up. The question is no
longer when will I be able to buy a
home. The question is what am I going to
do about it? Do you accept the surfom?
Do you fight for policy change? Or do
you join the caravan heading for the
exit? The Canadian dream isn't dead, but
it is immigrated and it is waiting for
you to decide if you are going to follow
it or try to resurrect it from the ashes
of a credit bubble. History doesn't
repeat, but it rhymes. And right now,
Canada is rhyming with a cautionary tale.
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