Canada had long provided subsidized housing for people who couldn’t afford to pay market value: for workers and returning veterans after the Second World War, for example, and in the 1970s and early 80s as pressure mounted for Ottawa to intervene during a series of recessions.
In the early to mid-1990s, back-to-back governments of different political stripes — first the Conservative government under Brian Mulroney and then Jean Chretien’s Liberals — began pulling back from the business of affordable housing.
The article isn’t wrong, but it’s missing context. It does provide a smokescreen for the failings of the provincial governments though.
The constitution was repatriated in 1982, limiting what the federal government could do in provincial jurisdiction. Agreements with the provinces for subsidized housing programs were allowed to lapse over time. The feds were fine with that because, as stated, they were dealing with a bit of a debt crisis.
In the GTA, housing prices flatlined at the end of the 1980s, and stayed essentially flat through the 1990s. The developers and the construction industry have a lot of sway at the provincial level, so they weren’t interested in new, low cost housing. That meant the provincial government wasn’t interested, especially during the Harris years.
The issue is provincial. Just because the provinces are failing to address it, doesn’t mean the feds can force the issue. Under the constitution, the federal government isn’t the senior government, it’s equal to the provinces, the only difference is the distribution of areas of jurisdiction. The feds have more than enough things in their own jurisdiction that they’re failing at.
Business regulations are, with few exceptions, provincial; zoning is provincial; property taxes are provincial. Although there are a national building and electrical codes, the provinces are free to modify and add their own rules, ignore others etc.
This is a clearer history of the equalization payments. Note in 1995 the Chretien gov’t cut them by almost 30% because of the massive debt left by the previous Mulroney gov’t.
That is a decent history. As noted by the author, the provinces have always been ready and willing to come up with creative reasons why they need more money. Sometimes they actually need it, sometimes they’re gilding the lily.
It has happened more than once, where an increase in the transfer was negotiated, and a number of provinces turn around and cut taxes, and put their hand out for more.
It’s the problem with the system we have. Some ministries, like health, are very expensive, especially so for smaller provinces. Once the feds get involved though, accountability gets muddied, and you get both the feds and provinces pointing fingers at each other as to who is responsible for the mess we’re in.
I should point out that debt originated with the Trudeau government dealing with the economic chaos that was the 1970s. Mulroney certainly exacerbated the problem with irresponsible tax cuts, much as Regan and Thatcher at the time. His government did partially contribute to the solution with the introduction of the GST as a more broadly based replacement for the old Manufacturer’s Sales tax, but too late to get any credit for sorting the debt problem.