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Lorne Gunter: Trump responsible for a lot of woes, but Canadian affordability isn't one of them

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In Canada’s affordability crisis, three of the largest contributors — food inflation, housing costs and business growth — have nothing to do with the madman in the White House and his imbecilic trade wars.

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United States President Donald Trump and his obsession with tariffs have had far less to do with the price of groceries in Canada than our own lack of productivity and competitiveness. Nothing has driven up prices on grocery shelves as much as overregulation.

Supply management of dairy, eggs, chicken and turkey (which protects domestic producers from foreign competition) contributes more to the retail cost of those items in Canada than do Trump’s illegal tariffs.

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The industrial carbon tax, which still exists (it was the consumer carbon tax that ended last year), also has a noticeable effect on food prices.

It’s little wonder then that food prices in Canada have risen over seven per cent in the last year — more than twice the rise in the U.S. and about 50 per cent greater than in western Europe.

Other contributors: We don’t have as many large farms here producing huge quantities of food at lower unit costs. And we don’t have the quantity and variety of grocery stores competing with one another and keeping prices low.

There’s even a name for this restraint of competition — “property restrictions.” A grocery store owner, particularly a chain, will put a clause in their lease forbidding the landlord from renting to another chain or independent within a set radius, frequently three kilometres.

All of these factors have contributed to the cost of food in Canada. They have given Canada the highest food inflation in the G7. And not one of them is Donald Trump’s fault. Nor can we blame climate change or a tough winter’s weather.

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There’s something similar going on with housing affordability. According to CIBC Economics, Canadians housing prices have fallen — in some cases dramatically (like Toronto condo prices, which are off 22 per cent year-over-year) — yet prices are still not affordable enough in many markets for first-time homebuyers.

At the same time, since many developers acquired the lots and lands on which they want to build when the cost of developable parcels was noticeably higher than it is now, they would lose money if they built homes that could only be sold at the new, lower prices.

Both buyers and sellers are trapped in lots of markets.

Ottawa’s wise decision to put the brakes on the Trudeau government’s ludicrous open-door immigration policies, and to send tens of thousands of visa holders home has also reduced demand and sent prices downward.

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Let’s not even get into the high development and permit costs imposed on developers by local governments.

A third example of Canada’s economic sluggishness that has nothing whatever to do with Emperor Donald I’s decree-driven tariffs comes from the World Bank’s Ease of Doing Business index, released last week. It puts Canada at 33rd in the world for regulatory hurdles to setting up new businesses or expanding existing ones. As recently as 20 years ago, we were fourth.

Our current ranking puts us 28 spots below the Americans and behind the countries of Georgia, Norway, Sweden, Malaysia, North Macedonia, Estonia, Latvia and a host of other countries you might not consider business-friendly.

We are just one spot above China — Communist China.

It’s Canada regulator burden that hampers our ranking. And, Trump or no Trump, that is within our power to change.

It has been especially true for the past 10 years — the Trudeau-Carney years — that investors have stayed away from Canada. It is too hard to get a “Yes” to new development.

In oil and gas alone, it is calculated that the Liberals ultra “green” policies scared away nearly $400 billion in development cash.

In most cases that money didn’t stay in investors’ pockets or be redirected to other industries. It went into the oil and gas industry in other countries.

And we wonder why our country is unaffordable.

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