Did Mark Carney Just Lap The NDP On Affordable Housing? Not So Fast.

The Liberal Party announced a plan for the government to build new homes. Is it all it's cracked up to be?

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This could be a house. Maybe it’s a small church. In short, I shouldn’t be involved in building houses. But the government should. Photo by Sandy Millar on Unsplash

On Monday, the Liberals announced a housing plan that includes a promise to create a federal entity, Build Canada Homes (BCH), “to get the federal government back into the business of home building.” I was immediately intrigued, and excited. I think we need a public developer to build non-market housing. The market won’t. Not enough of it, anyway. But I don’t want to get too excited yet. One never should in electoral politics.

According to the party, BCH would be an affordable developer “at scale,” building homes throughout the country, “including on public lands.” There’s more to their housing plan, but this initiative stands out, in part because it looks a lot, at least in theory, like an ambitious, statist program of the sort one would expect to see from the country’s left-wing party, the NDP. Indeed, it borders on socialism at first glance.

But the details matter. There’s a risk that BCH, acting as a developer, sets into the private-public partnership (P3) hell that results in poor-quality, expensive, unaccountable outcomes – in essence, a giveaway to the private sector. There’s also a risk the plan is little more than a loan scheme, the likes of which will be insufficient to get the job at at scale as the Liberals promise. A primarily loan-based entity would also come awfully close to what the NDP is already offering (more on that below).

The Liberals say the organization “will develop and manage projects and partner with builders for the construction phase of projects.” I’m reserving final judgment until I see the specifics. For instance: Who gets what and how? How much will builds cost buyers? Will builds be and remain truly affordable? Is this non-market social housing, market, or mixed? How are profits distributed? Is this largely or entirely for pre-fab homes (seems like it may be the latter)? Will the union rights of workers be respected and protected?

All this aside, however, even the concept itself of a public builder is a great leap forward in the housing debate. The left should embrace the opening, as we should most offers to get the government into critical industries and to meet needs the free market can’t or won’t.

The NDP hasn’t released its full housing plan yet, but it looks like the Liberals have outflanked them on public building branding at least. So far, the social democratic party has promised to “unlock public land” for rent-controlled housing and are pledging to stop big investment firms from snapping up rental stock and driving up prices. They’re also promising to publicly finance home construction with a Community Housing Bank, one it would act as a “partner” that would pair with “non-profit developers, co-ops, and Indigenous communities.” Again, it could very well be that this plan and the Liberal plan are co-equal in all but branding, especially since the Liberals are also promising their own, low-cost financing for existing affordable home developers.

Whatever the distinction, or not, between the two plans. The terms of the housing debate in Canada are shifting to include more of a role for government in housing development, and that’s good. Once upon a time, the government built social housing in this country. For decades in the last century, from the Second World War up until the 1990s, the government recognized the need for the state to fill a role the free market wouldn’t and to ensure that Canadians had a decent shot at an affordable home. Then came the era of retrenchment, of the Third Way, of neoliberal economic dominance primarily driven, in Canada, by big cuts during the Liberal years under Prime Minister Jean Chrétien, an economic conservative if there ever was one.

Cuts to federal housing builds and programs under Chrétien and, before him, Progressive Conservative Prime Minister Brian Mulroney, helped fuel the housing crisis that we are living through now. It didn’t help that provincial governments came to bear more of the responsibility for housing and proceeded themselves to abandon the state’s role in getting (affordable) homes built, or downloaded responsibilities to municipalities who couldn’t afford the burden. Now, Carney has opened the door to getting the government back in the building business by the mere framing, no pun intended, of his party’s plan.

As Canada faces an existential threat from the United States and Donald Trump, Carney has also adopted a war time frame for his campaign, and for his housing plan. He’s billing his party’s offerings as an ambitious return to the commitment of the post-war years when the federal government built (pre-fab) homes for veterans coming back from service overseas. Those years and subsequent decades saw a massive expansion of the welfare state, a trend that benefited millions but was cut short as the economic order shifted from the 1970s onward.

Even if the Carney plan should fail to live up to its promise, the Liberals have opened the door to a shift in the very nature of our discussion around housing — and the left should seize on it. The prospect of the state playing a role in building homes, of doing what the market can’t or won’t, is on the agenda. The NDP should take this opportunity and try to exceed Carney’s plan, promising a housing agenda that rules out any P3 boondoggle while asserting the state’s role in building non-market, affordable housing for millions. For now, it may look as though Carney has lapped the NDP, but the party might still be able to catch up, and even pull ahead on the file.