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The apocalyptic doublethink of Poilievre’s economics

Poilievre did not predict Canada’s economic problems—he played a role in exploding them

Canadian PoliticsEconomic CrisisHousing

Conservative Party leader Pierre Poilievre appears in front of Sudbury’s iconic Big Nickel to talk about inflation. Image courtesy of Pierre Poilievre’s YouTube channel.

“There are parts of his “Debtonation” video that sound like your critique,” a friend said, referring to my July appearance on the This Is Revolution podcast in which I chronicled Canada’s descent into rentier capitalism. “Yes,” I said, “except for the key points that morph it into the exact opposite.” And that’s just the problem: practically every point in Conservative Party leader Pierre Poilievre’s story about housing affordability and debt—captured in two recent ‘mini-documentary’ films released across his social media channels—sounds compelling until one bothers to look up the claim. When one does, however, that same point turns into evidence Poilievre is proposing national economic suicide.

First came the “Housing Hell” video. Poilievre establishes its framework early: the housing crisis in Canada—which is real—started about eight years ago when Trudeau came to power, and was spurred by Liberal deficit spending. Poilievre would cure this with a dollar-for-dollar law mandating balanced budgets; by awarding housing support funding to the municipalities that had already met housing development targets; and by handing surplus government land and property over to the private sector. He proceeds to point out that we are building less new housing than we did in 1972, when our population was half its present size. He says the Squamish nation, able to bypass governmental red tape, are setting an example he would like to follow by constructing 6,000 housing units in Vancouver. Meanwhile, parts of Canada are less affordable than Singapore: “a wealthy island with 2,000 times the number of people per square kilometre as Canada.”

The first claim is simply as big and fat a lie as can be told. Housing costs skyrocketed at nearly identical rates through the very years Poilievre was in the cabinet of the Harper government. Moreover, they started spiking under the previous Liberal government which not only had balanced budgets but ran an annual surplus in nine of their 12 years in power.

The other parts are true—but even more damning for Poilievre. Canada indeed had higher per capita construction rates during its social democratic heyday, prior to, not because of, the neoliberal funding cuts that followed. The Squamish people first got their land returned into nation ownership, developed a (democratically approved) plan with a focus on community ownership of rents, then received $1.4 billion in loans from the Trudeau Liberals to swing it into action. This not only completely contradicts Poilievre’s proposals—as Alex Hemingway observed way back in 2020, “this speaks to the importance of not selling off public land”—but actually gave Justin Trudeau a major photo op.

And then there’s Singapore. Oh goodness.

After gaining independence just six decades ago, Singapore’s government used eminent domain laws to buy up private land, going from 30 percent public ownership to 90 percent (!). Singapore leases the land for use and then puts the land rents into the public purse to pay for benefits like quality public transit. A public housing agency, meanwhile, produces 80 percent of the housing units in Singapore, effectively eradicating private landlords from both land and housing. And yes, despite having 5.5 million people on a plot of land barely bigger than Toronto, Singapore has greater affordability and almost zero homelessness.

It was beginning to look like it would be impossible to find worse evidence for Poilievre’s policies than the sources he had cited. And then he released another “documentary” entitled “Debtonation.”

For the sake of brevity, I will avoid going through all the remarkable nonsense in the video, which would require a line-by-line transcription. I’ll simply focus on the points that sound like they’re in keeping with my critique: that predatory debt is a cancerous time bomb, it eats the real economy, causes widespread depression and suicide, and is used to hide problems until they explode.

First, Poilievre’s take. The Tory leader bases his analysis on the book This Time is Different: Eight Centuries of Financial Folly by Carmen Reinhart and Kenneth Rogoff. It’s an interesting choice: the authors were infamously found to have made a massive Excel sheet coding error that wildly distorted their data on government debt and growth, and are considered central to the public discrediting of austerity economics. As we shall see, I’m not surprised by the dubious character of Poilievre’s chosen source. Even attempting to use Reinhart and Rogoff, however, he ends with trouble up to his knees.

This Time Is Different argues that financial crises are consistently preceded by four phenomena. The first and most important is a sustained debt buildup, especially, as Poilievre notes at the very end of his video, of household debt. This is followed by asset price inflation, falling productivity, and large current account deficits. Poilievre claims it was his unique understanding of these recurring historical variables, especially debt: “that allowed me to foretell the inflation, interest rate, and housing crises we have today years ago (2020), when all the experts said it would never happen.” Poilievre has likewise repeatedly claimed that a return to balanced budgets will bring down interest rates, ease problems with household debt and, relatedly, the housing crisis.

But through the rest of the video Poilievre isn’t analyzing household debt, and this is key to all his other doublethink takes. Instead, Poilievre focuses on the total debt of the nation, including corporate and government debt. If interest rates returned to the average of the last 60 years, he argues, and 7.6 percent interest was paid on all that debt, it would raise our interest costs to nearly $300 billion per year: more than 10 percent of GDP!

It’s quite a sleight of hand.

My similar sounding debt analysis, which I began voicing back during the Harper years, was that although Canada was starting from a healthier and more social democratic position, it was sliding down the same neoliberal slope that had devastated the United States. The economy was not just becoming more unequal; it was becoming more predatory.

The comforting story hiding this slide this was that the Liberal government of the 1990s had fixed government debt with regular surpluses, while the Harper Conservatives (of which Poilievre was a part) had kept Great Recession deficits to a minimum and were rapidly moving back towards healthy balanced budgets. Poilievre, of course, continues to tell this story. His “Housing Hell” graphs show government debt as a descending line driving into the Trudeau mountain.

My story was that not one dime of that debt had been removed. It had been transferred from government debt onto the backs of the working class in the form of household debt, especially under Harper. For the working class, the economy was going down, down, down, and austerity-minded neoliberals like Poilievre were the prime culprits.

Poilievre doesn’t mention what happened to household debt over that time, so let’s fill in that gap for him. Here’s a graph on Canadian household debt per dollar of disposable income over the last 23 years:

Chart courtesy the Business Development Bank of Canada (BDC)

As you can see, much like the cost of housing, that number climbed steadily through the neoliberal era, from 94 cents in 1990 to over $1.80 today. No party has been innocent in this, a grievance we should hold against Trudeau as well. You’ll notice, however, that one period has a unique surge several times larger than Trudeau’s: Harper and Poilievre saw household debt rise by an astonishing 35 cents for every dollar of disposable income the average Canadian held in just nine years.

This is why the “Debtonation” story is as horrifying as it is backwards. Poilievre did not predict these problems; he exploded them. And he’s proposing a more radical round of the same economics in Canada’s most fragile moment.

Though its premise is the opposite of mine, “debtonation” is not a bad term for the story I’ve been telling. As I said on This Is Revolution, I think Canada is on the knife’s edge politically and economically. That’s because there was never anything “conservative” about what Poilievre put forward in the past, nor the extreme neoliberalism he’s advocating today, while the alternatives have not been halfway alternative enough.

But let me conclude with a point of agreement with Poilievre. The Squamish nation absolutely has put forward a compelling alternative to a trapped and teetering status quo. Democratizing the economy—and starting with land—is an excellent idea. That’s precisely the level of systemic change we need.

While the Trudeau Liberals have supported that one particular initiative, they have not held it up as a model to learn from, disseminate, and fund. If we truly want to defuse the household debt bomb, the rest of us should insist on doing just that.

Colin Bruce Anthes is an artist, educator, and democratic economy organizer. Colin has been artistic director of two theatre companies, taught in five post-secondary institutions across Canada, and founded Community Wealth Candidates in 2021. He has been a contributor to since 2022.


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