The federal Conservatives did something unusual this week.
They released a substantive, 15-minute mini-documentary on Canada’s housing crisis. As of Friday, the video had amassed 4.3 million views on X (formerly Twitter).
While the video has been sharply criticized by some in the media, we view it as a welcome change.
It is a break from the soundbite messaging we have come to expect — and loathe — from politicians. Big policy issues, like housing affordability, merit considered discussion that is not conducive to short talking points.
If the video encourages more parties to experiment with similar formats, that on its own would make it a success.
We also see no reason to condemn parties for adopting direct-to-voter communication methods, as Pierre Poilievre’s Conservatives have done. The media can take statements out of context or fail to convey politicians’ full meaning, while platforms like YouTube, newsletters and social media give politicians full control over their message. Traditional media is also the favoured medium of older demographics and the upper-income classes. It makes sense that politicians would want to reach Canadians who get their news elsewhere.
This does not mean, though, that politicians should denigrate traditional media or avoid engaging with it, as Poilievre has also done. Media remains a fundamental pillar of democracy. Politicians have a responsibility to engage with it, even if it means they’ll be criticized. That is, after all, journalism’s job.
On substance, the video must also be taken seriously.
Yes, it is true (as others have pointed out) that it contains some key omissions. It makes no mention of the pandemic as the reason why government spending exploded in 2020 and why the Bank of Canada undertook quantitative easing to lower interest rates and stimulate economic activity.
Poilievre also cites the early ‘70s as a period where the number of new housing starts was higher than today. He does not mention that this was a time of significantly higher federal spending on housing construction — likely because this fact does not fit the more market-oriented solutions he favours.
The video also only focuses on supply-side housing constraints, omitting the other main variable in any pricing equation: demand. Specifically, it does not touch that third rail of Canadian politics — immigration — that has been one of the key drivers of housing unaffordability. The Bank of Canada’s deputy governor Toni Gravelle highlighted these effects yesterday in a public speech.
A braver politician would be candid on this point. But a savvy politician, especially a savvy centre-right politician in Canada, knows better. Nothing would be surer to get a Conservative politician labelled a xenophobe than discussing immigration’s deleterious effects or proposing curbs to Canada’s high immigration levels.
But in its assessment of the state of housing unaffordability in Canada and its supply-side drivers, the video is largely correct. You don’t need to take Poilievre’s word for it. Check the data of the various sources he cites, including the OECD, Bank of Canada, Royal Bank of Canada, C.D. Howe Institute, Globe and Mail and others.
It is true that Canada now has one of the most expensive housing markets in the world, despite having the second largest land mass.
It is also true that housing affordability has deteriorated acutely during the Trudeau government years. Ownership costs as a percentage of median household income have jumped from 40 per cent in October 2015 to 60 per cent in April 2022, according to the RBC Housing Affordability Index. Average rent prices climbed steadily from 2015 to 2020 and then sharply during and post-pandemic, according to Statista’s rental price index.
And it is true that the Bank of Canada’s monetary policies and Ottawa’s deficits did materially contribute to the problem. In a November 2023 research note, Scotiabank estimates that “government consumption and pandemic transfers to households account for about 200 basis points of the 475 basis points increase in the Bank of Canada’s policy rate.”
Not everyone will agree with the Conservatives’ proposed prescriptions to the problem. These favour reducing regulatory barriers and using financial incentives to get municipalities to accelerate construction over direct federal involvement in housing supply. But this is the Conservative Party we’re talking about.
In sum, the party has correctly diagnosed some of the root causes of Canada’s housing affordability crisis and proposed solutions to address them. Last we checked this is exactly what politicians are supposed to do.
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