Business
Carney’s housing plan will likely spend a lot for very little
From the Fraser Institute
By Jake Fuss and Austin Thompson
The Carney government recently released its plan for a new federal housing “entity” called Build Canada Homes (BCH). Unfortunately, the plan is rife with conflicting priorities and major risks. Without course correction, Canadians could end up spending more while seeing no real progress on the housing crisis.
BCH’s core mandate is to cut the cost of homebuilding. Yet the plan would require BCH to favour Canadian-made and “net-zero” or environmentally conscious products. These goals are at odds. If a product needs a government preference to be used, it’s not the most cost-effective option. BCH won’t deliver affordable housing if it’s shackled by competing mandates. Simply put, chasing unrealistic “net-zero” targets and propping up domestic industries will drive up building costs.
To boost construction, BCH plans to use taxpayer dollars to reduce the financial risks to housing developers by providing loans, loan guarantees and equity investments for homebuilding. But slow and costly municipal approval processes remain one of the biggest sources of investment risk for housing developers. For example, developers face a 25-month wait, on average, for municipal planning approval in Toronto (compared to just 3.4 months in Edmonton). Federal spending won’t solve this problem—it will simply paper over the problem with expensive subsidies. In other words, to reduce financial risk for housing developers, the Carney government plans to stick Canadian taxpayers with the risks and costs of BCH loans and investments that may fail or underperform.
With BCH, the Carney government is also betting big on modular housing, based on the untested assumption that if Ottawa “drives demand” costs will plummet. Skepticism is warranted. If modular housing truly delivered on its promises of being cheaper, why haven’t private housing developers leapt at the opportunity? A study by Canada’s federal housing regulator found that modular housing is “no silver bullet,” noting that cost savings were uncertain and modular construction faces unique challenges related to transporting large prefabricated sections and protecting materials from weather damage.
At its core, the BCH approach rests upon a flawed assumption that the private sector cannot provide enough affordable housing. But that’s ahistorical—Canada had broadly affordable housing in decades past, provided almost entirely by the private sector. In reality, more private housing would be built today if all levels of government simply got out of the way and reduced taxes on housing development, relaxed rules on what can be built and where, and provided shorter and more certain approval processes.
Instead, through BCH, the Carney government plans to pump federal dollars into a broken housing system. Due to the shortage of construction labour, BCH projects may compete with private development rather than add greatly to the overall stock of houses—all at considerable cost to taxpayers.
Canada’s housing crisis won’t be solved by new agencies or lofty promises. On the contrary—governments should step back and let the private sector build. Build Canada Homes is yet another misguided Ottawa experiment: expensive, overreaching and ineffective.
Jake Fuss
Director, Fiscal Studies, Fraser Institute
Austin Thompson
From the Daily Caller News Foundation
At Tesla’s Austin headquarters, investors backed Musk’s 12-step plan that ties his potential trillion-dollar payout to a series of aggressive financial and operational milestones, including raising the company’s valuation from roughly $1.4 trillion to $8.5 trillion and selling one million humanoid robots within a decade. Musk hailed the outcome as a turning point for Tesla’s future.
“What we’re about to embark upon is not merely a new chapter of the future of Tesla but a whole new book,” Musk said, as The New York Times reported.
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The decision cements investor confidence in Musk’s “moonshot” management style and reinforces the belief that Tesla’s success depends heavily on its founder and his leadership.
Tesla Annual meeting starting now
https://t.co/j1KHf3k6ch— Elon Musk (@elonmusk) November 6, 2025
“Those who claim the plan is ‘too large’ ignore the scale of ambition that has historically defined Tesla’s trajectory,” the Florida State Board of Administration said in a securities filing describing why it voted for Mr. Musk’s pay plan. “A company that went from near bankruptcy to global leadership in E.V.s and clean energy under similar frameworks has earned the right to use incentive models that reward moonshot performance.”
Investors like Ark Invest CEO Cathie Wood defended Tesla’s decision, saying the plan aligns shareholder rewards with company performance.
“I do not understand why investors are voting against Elon’s pay package when they and their clients would benefit enormously if he and his incredible team meet such high goals,” Wood wrote on X.
Norway’s sovereign wealth fund, Norges Bank Investment Management — one of Tesla’s largest shareholders — broke ranks, however, and voted against the pay plan, saying that the package was excessive.
“While we appreciate the significant value created under Mr. Musk’s visionary role, we are concerned about the total size of the award, dilution, and lack of mitigation of key person risk,” the firm said.
The vote comes months after Musk wrapped up his short-lived government role under President Donald Trump. In February, Musk and his Department of Government Efficiency (DOGE) team sparked a firestorm when they announced plans to eliminate the U.S. Agency for International Development, drawing backlash from Democrats and prompting protests targeting Musk and his companies, including Tesla.
Back in May, Musk announced that his “scheduled time” leading DOGE had ended.
From the Frontier Centre for Public Policy
By Conrad Eder
Frontier Centre for Public Policy study reveals a decade of inflated Liberal forecasts—a track record that casts a long shadow over Carney’s first budget
The Frontier Centre for Public Policy has released a major new study revealing that the Trudeau government’s federal budget forecasts from 2016 to 2025 were consistently inaccurate and biased — a record that casts serious doubt on the projections in Prime Minister Mark Carney’s first budget.
Carney’s 2025–26 federal budget forecasts a $78.3-billion deficit — twice the size projected last year and four times what was forecast in Budget 2022. But if recent history is any guide, Canadians have good reason to question whether even this ballooning deficit reflects fiscal reality.
The 4,000-word study, Measuring Federal Budgetary Balance Forecasting Accuracy and Bias, by Frontier Centre policy analyst Conrad Eder, finds that forecast accuracy collapsed after the Trudeau government took office:
- Current-year forecasts were off by an average of $22.9 billion, or one per cent of GDP.
- Four-year forecasts missed the mark by an average of $94.4 billion, or four per cent of GDP.
- Long-term projections consistently overstated Canada’s fiscal health, showing a clear optimism bias.
Eder’s analysis shows that every three- and four-year forecast under Trudeau predicted a stronger financial position than what actually occurred, masking the true scale of deficits and debt accumulation. The study concludes that this reflects a systemic optimism bias, likely rooted in political incentives: short-term optics with no regard to long-term consequences.
“With Prime Minister Carney now setting Canada’s fiscal direction, it’s critical to assess his projections in light of this track record,” said Eder. “The pattern of bias and inaccuracy under previous Liberal governments gives reason to doubt the credibility of claims that deficits will shrink over time. Canadians deserve fiscal forecasts that are credible and transparent — not political messaging disguised as economic planning.”
The study warns that persistent optimism bias erodes fiscal accountability, weakens public trust and limits citizens’ ability to hold government to account — a threat to both economic sustainability and democratic transparency.
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