There is a crisis of homelessness across Western democracies. In Canada an estimated 235,000 people experience homelessness every year and 35,000 need somewhere to sleep on any given night. In United States, Housing and Urban Development officials say the figure is about 580,000 homeless people and provides data on the statistic by state. Suffice to say there is some evidence almost 1 million people in North America are “homeless”.
Homelessness is a direct result of government policies that have made housing unaffordable - artificially low rates driving up the price people were able to pay by reducing mortgage costs; cities and towns whose municipal governments put barriers to housing development limiting supply; and, rent controls making it uneconomical to build rental units. Altus Group publishes building costs across Canada in an annual report and many would be surprised to find that building homes costs about $200 to $300 a square foot making the construction cost for a three bedroom, two thousand square foot home about $400,000 to $600,000. Try to find one for that price.
Even if homes were available at the cost of construction, with the inevitable inflation caused by restrictive policies limiting production of fossil fuels and driving up energy costs and reckless government spending expanding the money supply faster than economic growth, rents are about as unaffordable as home ownership. Mortgage rates today are in the five to six percent range. Build a rental unit for the low end of construction costs of $400,000 for the apocryphal three bedroom home I described above and try to rent it for enough rent to cover interest costs of at least $20,000 to $24,000 per year, property taxes of around $4,000 a year and a tiny profit and you will need rent of over $2,000 a month. Canada’s average rent today is close to that figure at $1,950 a month and you won’t get a three bedroom home for that rent in any major city or likely anywhere else. Cut it anyway you like, your landlord is subsidizing your rent.
With rents typically over $2,000 a month, utilities (including a senseless carbon tax) of at least $200 a month for water, electricity, heating fuel (oil, gas or electric) your basic housing costs will run over $26,000 per year. Policy makers often say housing should cost no more than 30% of income, so that cost implies income of $88,000. Canada’s average household income is about $75,000 annually. Think about that.
People are homeless for many reasons and left wing politicians refer to drug addiction and mental health issue as contributors. Drug addiction is a lifestyle choice made by sane people and they should live with the consequences of their choices and not impose the costs on me or anyone else. Mental health issues have become an excuse with dogma suggesting mental health issues are rampant in society. That is a cop out. Alberta reports data suggesting 21% of Canadians will suffer mental health issues in their lifetime, about 4.5 million people. Of those, only 1% are organic brain disorders and another 1% schizophrenia. The balance are anxiety, depression and personality disorders - labels that categorize the ordinary ups and downs of life in Canada as “mental disorders”. Who hasn’t been anxious or depressed or had an outburst that would be characterized as a “personality disorder”?
What homeless people need as much as a home is a job. The Toronto Star reports that in 2022 there were about 1 million unfilled jobs in Canada. The United States has some 10 million unfilled jobs. It is not mental illness that leads me to the conclusion that many homeless people just dont’ want to work and won’t work as long as someone else is paying the freight. Sure there are homeless people who actually have disabilities but generalizing that to suggest all homeless people are “victims” is the fallacy of composition. The homeless camps in California and Vancouver and occasionally in Toronto are filled with young, healthy people many of whom have chosen to abuse drugs like cocaine, heroin or other opiods. Why are they my problem?
I have friends who tell me I am cold-hearted and haven’t experienced the suffering of loved ones struggling with drug addiction, mental health problems or homelessness. I don’t bother telling them my mother suffered from schizophrenia and starved to death 23 years ago; my younger brother committed suicide while homeless and down to his last $2 when he ended is life in Northern B.C.; or my eldest daughter who died from heroin and cocaine abuse. My friends are so left wing they pull out a hankie for every sob story and think society should just give people homes, pay for their drugs, create safe injection sites so they don’t die from becoming infected by sharing needles and that the burden of their care and feeding is something taxpayers should be happy to provide.
Canada is only 156 years old. In 1867, there were no “social housing projects”, no “safe spaces”, no welfare programs, few hospitals, virtually no mental health clinics, and no left wing programs supporting people who were unwilling or incapable of working for a living and looking after themselves. In my opinion, Canada was a better place when the support people had when down on their luck was from friends and family. Canada’s 235,000 homeless all have “friends and family” somewhere, but our progressive governments think the entire burden of the down-and-out should fall on society in general. That makes no sense, encourages the growth of the problem, and at some point is untenable for society.
I supported my homeless brother, giving him money whenever he showed up or asked my help. I supported my drug addicted daughter sending her money (which she immediately blew on another bout of drug abuse). My support was wasted on them but at least was no burden to taxpayers. They were doing what they wanted and ultimately they suffered the consequences of their choices. Don’t shed a tear for them. People die from all manner of risky behaviour - hitting trees while skiing out of control; falling off mountains when mountain climbing; driving recklessly and being killed in motor vehicle accidents - and so on.
The solution to homelessness is obvious. First, provide social housing for those disabled or otherwise incapable of work and let them supplement their disability support with whatever income they can also earn without “clawbacks”. Don’t build needless barriers to their efforts to succeed.
Second, open up the markets for home construction without the "heritage committees" of many towns and cities and restrictive “official plans”; stop saying the "greenbelt" needs protection while Canada has 1 billion acres of boreal forest and the “greenbelts” comprise a miniscule portion of that land; deregulate homebuilding except for safety codes and let the market work which will bring home prices down to the cost of construction (about $200 a square foot according to the latest national survey from Altus Group) plus about 10% profit1; and, end the left wing intervention in markets with artifically low interest rates driving prices higher only to be followed by rampant inflation forcing rates higher and crushing household income.
Finally, for those already homeless and capable of work, help them find jobs ideally away from congested cities and pay for any necessary training not available from employers. For example, there are hundreds of well-paying jobs going begging in the mining industry in places like Timmins, Gogama or Emo, Ontario where where housing costs are still sensible.2 Provide limited financial support for the homeless who are willing to work until they are gainfully employed with enough regular income to support themselves. Help them acquire the skills they need through training and help them relocate to where they can operate independently. If they refuse saying “they want to live in the city” respect their wishes and forget about them. Homelessness is their problem, not mine and should not be not society’s.
Canada’s homeless problem will keep growing as long as Liberals are in power, encouraging more immigration than can be supported by the rate of homebuilding; continuing to regulate homebuilding beyond what is needed for safety and building integrity; and, running massive deficits that manifest themselves in persistent inflation which is outpacing wage gains by a wide margin. It will take serious leadership in Ottawa and Queen’s Park to make a dent in the problem and there is no evidence of capable leadership in either venue.
Canadians either benefit from or are victims of those they elect to public office. The persistent rise in socialism among Canadian youth suggest that the problems will be with us for at least another generation. No element of socialism has a ghost of a chance of improving our society. We need free markets, smaller government, fiscal prudence, less regulation, and limits on government intervention in markets or the prospects are dim for our children. Sadly, many of them have been persuaded otherwise.
Nobel laureate Bob Shiller’s Case-Shiller Home Price Index tracks house prices relative to inflation and the impact of needless government intervention is patently obvious - real home prices outpacing inflation is the direct result of market intervention by governments.
There are rental units listed on Kijiji in Timmins for less than $1,200 a month and some less than $600.
Elon Musk Tweet :
“You could literally film a Walking Dead episode unedited in downtown SF.
This is where San Francisco politics leads and Twitter was exporting this self-destructive mind virus to the world.
With some exceptions, other tech companies are still doing so.
Evil in guise of good.”
A very 'common sense' article. I enjoyed it thoroughly. Does anyone know if Michael has written his auto-biography and where can i buy a copy.
Thanks, Robert