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My Thoughts on Canada

This article will be the one stop shop for my thoughts on Canada. Please refer to the table of contents to read sections that are interesting to you.

Table of Contents

Housing Affordability

Let us start off with one of the biggest issues facing Canadians under the age of 40. The best way to deal with housing affordability is to make homes affordable for those that don’t own a home. This means reducing the demand from non-primrary home buyers and increasing housing supply.

Domestic speculation is a probelm in Canada. Temporarily banning foreign buyers or taxing vacancy is not going to bring affordability. It doesn’t go far enough. You have to ban foreign ownership itself. Why do we even let foreign buyers purchase residential homes in the first place? That itself should be taxable. Call it a foreign ownership tax.

As a Canadian citizen, I would expect to not be able to purchase a US home, unless I have a green card or was a dual citizen, even if I have work permit. That is not the case, but that’s because the US econmy is 10x Canada’s. Likewise, foreigners who cannot reside in Canada, should not be able to buy properties in Canada.

I do not think housing should be something where land lords can live off the rent they make. That is absurd, and thus companies should not be allowed to buy residential properties either. If companies own residential properties, it should be because of reasons like developing the property itself.

As for undeveloped land, we could say that development of the land has to be started within a year of purchase, otherwise both the previous and the current owner get fined. However, I don’t think there is a problem yet with undeveloped land, so let’s keep this up our sleeve.

Reducing Demand - Major Speculation Tax

To reduce demand, we will add a buyers (speculation) tax on non-primary home purchases for homes transactions that are more than $150,000. There’s no reason to own more homes than people in your immediate family. For clarification on the definition of an immediate family, a couple with one kid over 18 can buy 3 homes but a couple with a kid less than 18 can only buy 2.

I propose this speculation tax to start at 50% and to modify it the next year. If it’s too low, we’ll make it 100%. If prices dramatically fall, we will get hated by property owners but at least the U40 population will vote for us again. If even a 100% tax is too low, we can further reduce the 150k threshold so that most couples would have to use their secndary home allowance itself as the other tax-free property. For example a secondary property could be a storage area, a cottage, or a simple office.

Existing home owners with more homes than people in their immediate family have 6 months to pay the buyers tax on their (# homes - # family members) most expensive homes. So even if a couples primary residence is the most expensive, they have to pay the buyers tax on it and not their cheaper investment properties. The problem in Canada isn’t just foreign spending, it’s domestic speculation. We need to tackle our own greed.

With this buyers tax, one could argue that a couple itself is treated as one in the eyes of the law, and therefore they should be given one less home to own, but I think that would mess with something other than housing prices.

I’m up for debate on whether to include properties that were inherited.

This buyers tax should be implemented federally. People who are buying homes in multiple provinces are definitely upper middle class or rich. Therefore, a 50% or even 100% tax is not a problem if they are buying to live rather than to rent. Imagine a multi millionaire; that 500k property now costs 1M, so it’s not a problem.

Increasing Supply - Vacant Homes

I was watching a video on a $20M abandoned mansion in Toronto. I searched more up. There are many vacant or abandend properties in Toronto. This neeeds to stop. The governments on all levels need to enact a law that would force current property owners and banks to either find a tenant within 6 months, or be forced to auction the property off through a government website with no reservation price. This would end up housing 60,000 groups of people in Toronto alone and probably. A vacanacy tax is only an incentive to sell, but does not actually solve housing. Nationally, we can conservatively estimate there to be $100,000. The purchasing agreement would be 1 month to change the primary residences, find a tenant, or to create renovation plan with details. With thed demand constrained, it’ll mostly be a primary residence thing rather than finding tenant. To prevent renovation abuse, we should enact a fine on the renovation filer 2 years later. This also prevents owners from abusing the renovation clause in order to flip the house.

Increasing Supply - Undeveloped Land

Currently, one of the issues preventing houses from being built is zoning laws. This is hearsay as I have not encountered actual proof/rationale to why zoning laws contribute to expensive housing when land itself is expensive! If the previous policy does not work, then I propose a wild idea. Land earmarked for development needs to be sold within a year or start building a house within a year or two. Fines will be issued (percentage of last listing price) if land is sold a second time within a year or two, or if a milestone was not reached with 6 months buffer period (accounting for Winter). This would be a policy with an intent to be temporary, however if affordability doesn’t improve in 4 years, it would end up being permanent. By affordability, I mean prices would have to drop to reasonable levels before even factoring inflation and wage increases.

Land in small towns is cheap but requires building a house. Why would anyone build a house in a small town if salaries are surely going to be lower in those places? Only a WFH policy would help you out. Therefore, these places help couples with money who aren’t struggling in the housing market (therefore no dent in demand). To actually dent demand in high demand areas, we need to spur small businesses in small towns. That’s a demand side policy to reduce demand in places like the GTA.

Increasing Supply - Prioritized Development

In the case reducing demand isn’t enough, the affordability problem is clearly supply sided. My proposal is that we use the tax revenue from the speculation tax to fund housing developments. The government should not spend this money. We should issue loans at an interest rate equal to the rate banks offer. We can either create a new department would handle this stuff or if there is a lot of money, loan the money to credit unions directly and let them issue the loans for us.

The procedure for giving out loans is as follows. Start with neglected and cheaper provinces. The residents of these provinces have the least purchasing power and therefore are more vulnerable to housing affordability. New Brunswick for one. The territories have their own problem like Nunavut needing $100M for their water plant but I didn’t get a chance to look at their budget to figure out if they just want a handout or are being serious. We want to fund housing developments in three provinces concurrently. These provinces are picked by a median income ascending. Again, territories are something else, so we need a different strategy for them.

In the long term, we should focus on more than fixing housing prices, but distributing them equally across Canada which includes distributing job opportunity and incomes a cross the board.

The Ideal Canadian Life

Now we can move on to idealism rather than current issues.

What is the ideal Canadian life? I want to answer this question. It’s very easy to fall prey to the unlimited wants nature, so we’ll have to answer what would make a Canadian content without bias?

The age at which this idealism should be achieved for Canadians is 30 years old. I believe by 30 people would start a family. I also know that by 30, we start to visually age. So at 30, we want to be living our ideal life.

Living Situation

I haven’t made up my mind on whether to have children or not, but in the off chance that I do, I’d probably have 2 children. Therefore, an ideal house will have 3-4 bedrooms. The extra one is for guests. I think there should also be 3 washrooms.

One should plan out the general location where they want to build a family right after marriage1 because then you won’t be locked into a location because of work, family, or friends. I’m pretty sure this is one of the biggest factors preventing people from moving to affordable locations. The other factors are activities which we’ll get to now. Personally, I would love to live in New Brunswick, but I’ll try to cater to all. If you want nightlife, you’ll have to lower your bedroom and washroom numbers.

Activities

For this, I’ll have to think from other peoples' shoes. We have two ways to go for this. We can go suburban or urban. For sake of the American Dream fantasy, we’ll go the suburban route. So our activities consist of: waterpark within two hours, theme park within 2 hours, a picnic type park within 15 minutes, biking routes, tennis court, basketball court, soccer fields. Also a gym if you want to improve your physique. You can reduce or increase this list based on your wants.

Income

Warning, this section is completely scuffed; as in I might’ve made more than one blunder.

My thought process for this is simple. We need to calculate ideal income based on how much we need to invest in the stock market, how much we will pay for mortgage, and how much we would want to spend per month on other things.

This ia big one, if not the biggest. Typically, we want $1M in cash by the time of retirement. Why? With $1M and 7% average annual S&P 500 return, we get $50,000-$70,000 per year if income tax is payable or not. I believe this is enough since we assume there is no mortgage and we aren’t going on spending sprees. With disposable income of $4,000 / month which would be worth $2,000 minimum accounting for inflation, we’re good. In total, household networth at retirement (age 55) should be $1.5M to $3M. In business classes, we’d do some math to calculate the money needed at retirement in order to die with X amount of money. However, since we are dealing with an ideal lifestyle, we want to be able to live off passive income and leave our children with something.

We need to employ some financial equations now to account for real stock market growth of 8.66%.2 To get this number, I used 35 years of data from Jan 1st 1986 to Dec 31 2021, adjust for inflation, add dividends, and subtract 0.03% because VOO is the cheapest S&P 500 exchange traded fund (ETF).

I don’t have time to update my old investing article, but I summarized the basics here.

We can use this Python function I made in 2019/2020 to first calculate how much we need to put into the stock market per week.

def get_savings_amt(future_savings, years_to_retirement, interest_rate,
                    compounds_per_year=2, startwith=0, saving_period=12):
    """
    Calculates how much you need to save per month to retire given the parameters
    """
    r, m, n = interest_rate, compounds_per_year, years_to_retirement * saving_period
    efr = (1 + r/m) ** (m / saving_period) - 1
    already_secured = startwith * (1 + r / m) ** (m * years_to_retirement)
    future_savings -= already_secured
    return future_savings * efr / ((1 + efr) ** n - 1)


>>> # assume we start working at 25, we start with $0, and we compound yearly
>>> # multiply by two to account for market volatility
>>> get_savings_amt(1000000, 30, 0.0866, 1, 0, 52) * 2
>>> 288.51322722512805

In the future I will try testing this out on actual data and seeing if the results are as intended. The market is volatile so we can’t use an answer based on a monotonic assumption without double checking. In order to account for volatility, I doubled my answer.

$288/week translates to $1,248/month or $14,976/yr.

A down payment on a $2M home is $400,000 and if we want to buy it when we are 30, we’ll need to save (household) $80,000 per year.

What Yearly Amount (CAD)
Investing 15,000
Downpayment 80,000
Food 15 * 30 = 10,950
Two Cars 15,000 to 30,000
Mortgage/Rent 4,600 to 9,305.68
Monthlies 250 * 12 = 3,000
Misc. 10,000 to 12,000
Vacation??? 3,000
Upper TOTAL 163,255
Upper Income 280,000
Lower TOTAL 146,255
Lower Income 250,000
Per Person 125,000

I did a lot of rounding and over-estimations, but overall I’m happy with my results. The upper bound is assuming you are a baller and want a $2M home. That’s not me, but some people out there want to be entitled to that. Personally, $1M home is enough for me, especially if it’s in New Brunswick.

I guess this is the problem then huh? When half of Canadians earn less than 80,000, the ideal Canadian life is unattainable unless you’re in specific career paths. So we’ll look at careers that can earn 125,000 including alternative careers, as well as what Canada (government) can do to improve the situation (increasing purchasing power).

$125,000 Careers

Software engineering of course. Product managers and project managers also make this, but those career paths are rarely talked about. Someone should make an article on those two career paths. What else? Lawyers, doctors, investment banking.

I don’t really feel like writing this section, so I’ll stop for now. I think the issue is that there’s no way for a 30 year old to be experienced enough to earn that much in some career paths that start off at $80,000.

The Government

Engineers are grossly underpaid in Canada and the US. Not all engineering challenges are complete, yet these people get paid pebbles. I propose some industries that are lacking in Canada. We need Canadian companies for these engineering innovation industries.

  • CPU chips
  • electronics
  • automobile
  • aerospace
  • defense
  • agriculture
  • telecommunications outside of Ontario and Quebec
  • lumber vertical integration (companies that use wood extensively)

We should also abolish the P. Eng fee. What a useless fee. People should not be sitting on their asses while others work hard.

A Fair Electoral System

After the 2021 Federal election, I was dismayed at how horribly parliament seats reflected who voters voted. So I came up with a proof-of-concept of a new electroal system that combines local representation with a proportional voting. I’m calling it the Represenative Proportional Voting. It’s in its infancy at the moment, but I hope to formalize the algorithm and system in the future.

Taxes

TODO: split into different types of taxes (income, property, sales, sin, capital gains, tax ethics, duties/tariffs, etc.)

The government goal should be to use taxes to create a sustainable environment for innovation and wealth. Taxes should be used wisely with the end goal of lowering taxes. Governments should create self-sustainable nationlised businesses where the nature is a priviledge rather than a need. Things like health care should remain nationalized, but private health care should also be allowed as it is in Quebec. Not sure why courts in Canada think that private health care access takes away from Canadians who are using the public health care system, but hey I’m not a judge and they aren’t economists.

Sales Tax

Should not exist. There are so many exceptions and the CRA does not do a good job at exempting everything. For example, the CRA reqeuires you to have a phone number in order to login because of 2FA, but phone plans and phones have salex tax. These are necessities and a sales tax is regressive3 in this case. There are simply too many cases of figuring out what is a necessity and what isn’t. Not to mention that on top of federal sales tax, each province has its own sales tax rules. Therefore a national business needs to report to so many different provinces or join something like US’s nexus. So then implementing a sales tax fattens the government (additional beauracracy).

Tariffs

There should be almost 0 tariffs and import duties. If people want to shop in America, good for them. A trip to America is not free, so why make citizens' lives more expensive?

Organ Donors

People can choose to donate their organs for free upon death, but yet organs go for thousands of dollars in black markets? Governments should incentivize people in poverty to become organ donors so that when they die, their family will receive a payment instead of being left with nothing. A charity should be started for this at the very least.

Education

For a country to be competitive on the global stage, education must be done in a way that strives for perfection and without excuses. It is one of the things that I’m okay with requiring mandating. People under 18 are simply not mature or intelligent enough to make their own decisions in life, and the current state does not integrate elementary well with high school well with post-secondary. In high school, there is school every day, for four courses, in a longer term than university, where there are 5 courses, not every day, with a shorter term, harder, expensive, and a higher risk of failing.

So what is “so good.” Good question, I will leave this as an exercise for the reader. Just kidding; This is a TODO since like I said in the introduction, this article is a collection of my thoughts on Canada that come to mind. I also try to keep it as articulate and cohesive as possible, rather than vomit words. I aswell try to add my quirks and humor where I can.

National Defence

One of the key functions of the government is to support national defence. Now even though Canada is part of NATO, NATO members are supposed to spend 2% of their GDP on national defence. I disagree with this percentage idea. If a percentage, it should be based on tax revenue, not GDP. Better yet, there should be a plan on how to spend on national defence. There are 4+ things when it comes to national defence. Air, Water, Land, range weapons (i.e. missiles/nukes), and air-defence (e.g. Iron Dome).

Airforce

An airforce is crucical. A single aircraft can devastate many land units, so an air-defence system is just as crucial. An airforce should be as mobile as possible and should be not be crippled with one attack. In other words, there should be multiple air-bases and the location of these bases need to completely classified or opaqued, but the existence of them should be stated. This is an equal balance between government secrets in the name of national defence. Some governments, like the USA, take it too far and classify even operations. An operation should be classified until it’s over. Then it should be made as transparent as possible.

A Navy is useful for shipping as well as long-lasting operations. It’s also useful to for saving the fuel of aircrafts and keeping a moving aircraft base. That is, instead of having fixed aircraft bases, we can have mobile bases. Hypothetically, aircraft carriers reduce the need of fixed airbases and thus we could save money while improving the reliability of the air-force.

Army

The army is useful when aircrafts and missiles cannot be used luxuriously. An army’s strength is determined by both strategy and manpower. This is because, one person could either take out 100+ enemy soldiers, or die without being of any use. For countries like Canada, we should reduce the school length term for grade 12ers so that their 4 month summer can be spent learning how to be part of the military. I am against military conscription, but with a trained civilian population, we will be able to depend more on the power of patriotism, civil duty, and volunteerism. A person with even basic military education will be more willing than a 30 year old who has never shot a gun before.

This training will not be as strict as the army and military is at the moment. I am strongly against force, so things like being forced to get a haircut, cost-savings on living quarters, and drill sargents are a big no. People should not be scared of the training, but rather take it calmly. The entire course should be able to be completed in 3 months, there should be lots of free time mixed in so that people don’t lose their minds. Since the program can be completed in 3 months, an extra 2 weeks of bonus or specialized education should be added for people who completed the education on time while the people who lagged behind, can catch up on their basics. This is perfect because a) does not stop the progress of fast learners b) gives slower people more time to learn.

My Platform

My platform would be run on the basis of redefining what a government’s job. It is to govern after all, and so we need to redefined it to govern effectively. We’ll start by prioritizing issues. What are the greatest issues faced by Canadians? I won’t go into the detail on why I chose this order, only my plan or solution for each of them.

  1. Electoral system
  2. Disability benefits
  3. Housing affordability
  4. Indigenous people
  5. Income, entering the workforce, brain drain
  6. Education

Improving Electoral System

My first order of business is fixing the electoral system on all levels of government. By making a system more democratic, parties are forced to collaborate in order to get work done. I want to set the example for what democracy looks like and all countries should look at Canada as being the most innovative and progressive in terms of democracy and fundamental human rights.

As mentioned before, we will use the Represenative Proportional Voting. A recap: MP and MPPs still exist, but are chosen based upon party confidence in each riding, and not winning the riding (independents are the exception).

Improving Disability Benefits

This issue is getting out of hand. On a pronvincial level, it’s an expenditure spiral; in other words, the province with the best benefits attracts disabled people (rightfully) from other provinces and in the long-run, would end up paying more for the program than other provinces. Therefore, disability benefits should be solely within the jurisdiction of the Federal government. Accesibility doesn’t seem like an issue so I won’t comment on that.

Now, let us create a comprehensive plan for disabled people in Canada. I’m waiting on getting data on Ontario’s disability benefits, but after that I will continue this section.

Improving Housing Affordability

I already talked about this at the beginning

Improving Indigenous Relations

This is such a hot topic. People are quick to jump to their feet and march for the unmarked graves at residential schools, but aren’t willing to start a discussion on what we should do in 2022. The indigenous issue has existed for over a century. For goodness sake, the indigenous are still referred to as Indians in formally! Anyways, getting back on topic…

We need to think about the issue differently. That is take the total population of each province, and divide the pronvince’s land size by this number.

Now that we have the land per capita, we multiply it by the Indigenous population in each province to get the land the indegenous are owed. This is the land that is owed, so then we partition hunting land in each province equal to land owed minus land presently occupied as reserves. This ensures that a) current reserves don’t go away, b) no more than land owed. This calculation isn’t required at the moment since I’m not even in politics!

So we’ve given the indigenous people the land they are owed, but that’s not enough. They need to be given more freedom and more rights. We shall negotatite with the Indenous and decide something important. Does the Indigenous people want government investment into infrastructure, or do they want to manage their land themselves? If the former, then they will have to pay only income taxes at half the rate for 250 years (not arbitrary, but it is rounded). If the latter, they can invite the private industry themselves to invest in infrastructure like fiber optics and tellecommunication towers. I have no clue how the Indigenous people want to live, but since each province’s population gets to decide, I’m sure at least one would choose the nomad style. They are free to change their mind from no-support to having government support, but not the other way around.

These areas will be free to incorporate. If they do so, a proportional voting system shall be used to determine 10 representatives and a leader. I think with proportional voting, this will suffice. Once incorporated, they can choose to sell land to developers and initiate a tax on that land. The government will provide city planners as advisors no matter the level of independence chosen. The goal is to build a sustainable economy for the indigenous and allow them to choose without pressure to leave the Indigenous locality. For example, they might want to preserve their culture and language. So something like English/French language laws wouldn’t apply. However, if they decide to invite private industry, they’d probably want to support the English language.

The education system doesn’t teach much about Indigenous history other than a couple classes in elementary school. How did they get here before the Vikings, what were they doing the last couple of centuries, how did they react to the British small pox? It is critical to include Indigenous history as part of Canada’s history if we are to recognize them as having a claim to this land.

Of course we can go the other route, which is to fully assimilate the Indigenous to Canadian society. This would mean requiring indigenous to attend a school of the majority language in the province. It is imperative one of these paths are chosen rather than what we got now, which is complete mess. “Do we let them own the land on the property, or would that result in them selling it immediately? They can’t make those decisions for themselves.” This faulty thinking is why the reserves are so poorly maintained.

Improving the Tax System

Filing taxes for Canadian corporations is attrocious. I use my parents' accountant for income tax but in the future I will have to do it myself and then I’ll comment on that process.

It is very clear why corporations avoid taxes if the CRA is trying to invade the corporations' privacy rather than just ask politely for the corporation to pay taxes on its profits. There are so many forms and you have to fill them in depending on questions that are asked as well as direct references to sections in the Income Tax Act!

I realize very quickly, that for ethical individuals interested in a close-knit ownership (membership), not for-profits is the way to go. You get to control who becomes a director, and potential investors can be added to the board under a policy. For example, a contract that would stipulate what voting rights they get. It’s absolutely ridiculous that not for-profits do not get taxed. The CIRA (canada internet registration authority) is a not for-profit and they only donate to other not for-profits ventures but the Canadian government? $40M to Rogers for New Brunswick internet infrastructure (thousands of dollars per family in New Brunswick).

The Canadian tax code 100% punishes innovation and it makes me think that entrepreneurs in Canada are either patriotic, know for sure they are going to print money, or they just didn’t think about the corporation residence that much. I’m the patriotic type, and my goals largely involve Canada.

Income, entering the workforce, brain drain

This is too much to write at the moment.

Improving Education

TODO: I will create an overview on what the education should teach, how it should teach, goals of the education system, etc.

Drunk Driving

I was reading about the billionaire killing. I do agree with the sentencing as it was already the harshest first offence drunk driving killing, BUT, we need to prevent drunk people from drinking, not punish the killers harshly.

My policy would be that if you are caught in a DUI with hard evidence, unless it was a life-death emergency, your license should be suspended for an entire year. No jail, no felony, no record, but a license suspension. Well there would be one record which would be “got caught drunk driving” for potential future instances.

A second offence would result in a 10 year license suspension.


  1. By marriage I mean the unification of partners in a relationship rather than the legal sense ↩︎

  2. Moneychimp - CAGR Stock Market Last 35 Years. ↩︎

  3. A sales tax is regressive because people with lower income pay a higher percentage of their income as sales tax if they bought the same goods. Paying for groceries is a lot harder on poorer people. ↩︎