
The economic forces behind Canada’s ongoing political drama
The economic forces behind Canada’s ongoing political drama

This story was produced by our colleagues at the BBC.
Frustrations with the economy are part of what led to Canadian Prime Minister Justin Trudeau’s sinking popularity after nine years in charge — and a calculation by some in his party that a fresh start was needed before the election. Trudeau announced his resignation in January, which paves the way for a leadership contest ahead of a general election later this year.
For the leadership contenders — like former Bank of England and Bank of Canada governor Mark Carney — the economy is front and center, as is the threat of fresh tariffs imposed by President Donald Trump.
“We don’t need their cars. You know, they make 20% of our cars. We don’t need that. I’d rather they make them in Detroit,” Trump said in January.
But Canada’s economic issues have deeper roots, with a sluggish economy and squeezed incomes and falling productivity.
“We don’t have a sense that the economy is becoming more productive over time,” said Stewart Prest, a political science lecturer at the University of British Columbia. “So Canadian industry leaders and Canadian political leaders continue to grapple with this question about how to reignite the economy in ways that can compete on a global scale.”
Public services are also under pressure — with long waiting lists for health care — and pressure on housing. The population has been rising, thanks to welcoming immigration policies. But those policies are now resented by some.
At her Toronto office, realtor Anya Ettinger described how the two issues have become connected.
“Everyone’s wanting to move here. So many people want to come here because it is, I mean, the biggest city in Canada. And with that demand, we only have so much land. We only have so much space,” she said. “So there’s so many people coming that our population will grow, but the amount of housing that we have does not.”
Then, there’s the cost of living: The headline inflation rate has been falling, but people are still feeling the squeeze.
“There is no question that whoever is prime minister next is going to have to find a way to deal with concerns with cost of living,” noted the University of British Columbia’s Stewart Prest.
Who that will be will be decided in March.
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