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Federal mismanagement to blame for Canada’s immigration backlash

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From the Macdonald Laurier Institute

By Sonia Orlu for Inside Policy

Canada’s welcoming attitude towards newcomers makes it one of the most sought-after places to live in the world. However, this image is being tested by a growing backlash against immigration. Immigrants make up 23 per cent of the population, yet economic, social, and cultural anxieties are increasingly challenging the country’s commitment to diversity. More than four-in-ten Canadians now agree – either strongly (23 per cent) or somewhat (21 per cent) – with the statement, “There is too much immigration to Canada.” It is crucial to understand that this backlash is not rooted in opposition to immigration or immigrants themselves, but rather in frustration over mismanagement and inadequate planning by the federal government. It reflects a growing unease about the country’s economic outlook, raising urgent questions about how Canada can uphold its values while addressing legitimate and pressing concerns.

Public reactions and political responses

Canadian political leaders have generally maintained a measured tone on immigration, focusing on economic pressures and service delivery rather than hostility toward immigrants. However, tensions are rising, and a thoughtful debate is increasingly needed.

Prime Minister Justin Trudeau has accused the Conservative Party of spreading misinformation to stoke fears about immigration. Such remarks risk alienating those with legitimate critiques of his administration’s policies and practices. Conservative Leader Pierre Poilievre has linked immigration to housing shortages, criticizing Trudeau’s policies as disconnected from infrastructure needs. This aligns with public frustrations over housing availability and the need for better coordination between immigration levels and capacity. Quebec Premier François Legault echoed similar sentiments, raising issues of resource management and culture. His critics accuse him of xenophobia, but dismissive responses like Immigration Minister Marc Miller’s remark that people are “always blaming immigrants” overlook genuine challenges and deepen frustration.

These exchanges illustrate the delicate balance required in navigating immigration policy and public sentiment. Canadians’ attitudes toward immigration are more nuanced than a simple pro- or anti-immigration divide. Most Canadians aren’t driven by fear or racism; rather, they are focused on how immigration impacts housing affordability, strains public finances, and increases job competition. While apprehension about immigration levels is growing, attitudes toward immigrants themselves remain largely positive. In fact, more than four-in-ten Canadians (42 per cent) say that immigrants make their community a better place, with fewer than one-in-ten (9 per cent) feeling that they make it worse. Still, public concerns must be addressed to prevent further polarization.

The housing crisis: a catalyst for frustration

A significant driver of the immigration backlash is the housing crisis. The Canada Mortgage and Housing Corporation (CMHC) reported in 2024 that Canada needs an additional 3.5 million housing units by 2030 to restore affordability. Cities like Toronto and Vancouver have seen housing prices soar, partly due to increased demand from population growth.

The “housing theory of everything” highlights how housing affects multiple societal issues – such as economic inequality, social mobility, and political polarization. Immigration is no exception. Housing shortages drive up costs, deepen inequality, and create competition between immigrants and long-term residents, eroding social trust and cohesion.

The rise in temporary residents, including international students and temporary foreign workers, compounds these issues. Immigration, Refugees and Citizenship Canada (IRCC) reports that the number of temporary residents increased by over 50 per cent from 2017 to 2022 and continued to rise sharply  into 2024. This influx contributes to increased demand in the rental housing market, particularly in urban centres with large universities, driving up prices and reducing availability.

The Trudeau government’s ambitious plan to admit nearly 500,000 new permanent residents annually by 2026 marks one of the highest per-capita immigration rates globally. By comparison, Canada admitted around 200,000 landed immigrants per year in the 1990s and 250,000 per year in the early 2010s. Without matching investments in infrastructure and housing, these elevated immigration levels – often referred to as “mass immigration” – could exacerbate housing shortages, strain public services, and heighten public frustration. Internal documents from Immigration, Refugees, and Citizenship Canada revealed that as early as 2022, officials warned that large increases in immigration could worsen housing affordability and strain public services. Yet, no substantive steps were taken by the government to revise its targets.

Given the realistic timelines for development, it is improbable that infrastructure can keep pace with rapid population growth. The construction industry faces labour shortages, regulatory hurdles, and lengthy timelines for project completion – often several years. The CMHC maintains that due to these complexities, expecting cities to rapidly scale up infrastructure to meet immediate demands is unrealistic.

If these housing issues are not resolved, public frustration could escalate, potentially shifting from concerns about immigration policy to resentment toward immigrants themselves.

Cultural integration: balancing diversity and cohesion

Economic challenges, such as housing affordability, often intersect with social and cultural anxieties. As communities experience rapid change and strained resources, questions arise about society’s ability to integrate newcomers without compromising its social fabric. While only about 4 per cent of Canadians express fears that immigration weakens local culture and identity, concerns about the effectiveness of integration are more widespread. In fact, approximately half of Canadians are concerned that some immigrants may not be adopting Canadian values or fully participating in the broader community. When asked which values immigrants should adopt, Canadians often prioritize language proficiency and respect for the country’s history and culture, highlighting the importance placed on cultural integration. Interestingly, both native-born and foreign-born Canadians largely agree on the values newcomers should embrace, indicating a shared vision for integration.

Canada’s sense of nationhood is deeply tied to its history of migration and its commitment to cultural and ethnic diversity. However, diversity is not inherently beneficial in all forms; its value depends on whether it leads to greater tolerance, creativity, or economic growth. When cultural and ethnic diversity is celebrated without deliberate efforts to foster interaction and promote unity, it risks becoming fragile. Poorly managed diversity can lead to social fragmentation, lower trust, and weakened civic engagement.

The challenges of integration are well-documented. Language barriers, different social norms, and unfamiliarity with Canadian institutions can make it difficult for immigrants to fully integrate. This can sometimes lead to the formation of cultural enclaves, where newcomers find comfort in communities with shared backgrounds but have limited interaction with the broader society. While these enclaves provide crucial support, they can inadvertently hinder full participation in Canadian life. Sociologist Robert Putnam found that, in the short term, diversity can reduce social capital and lower community engagement, particularly when institutions fail to promote integration – a concept he refers to as “hunkering down.” In such cases, both newcomers and long-term residents may feel isolated.

Despite these challenges, diversity, when managed effectively, can yield benefits. Exposure to different cultures fosters creativity, innovation, and economic growth, even though research suggests that immigration itself is neither inherently good nor bad for the economy. Cities like Toronto and Vancouver have thrived in part due to their multicultural populations, which have helped them become global hubs for technology and the arts. Additionally, evidence shows that successful integration is common in Canada. Many immigrants actively embrace Canadian valuescontribute to the economy, and participate in civic life. The majority of eligible immigrants become Canadian citizens, demonstrating a strong commitment to their new country. Many immigrants choose Canada precisely because they align with its principles of democracy, equality, and respect for human rights. Cultural integration, in the end, is a dynamic process – one that, when approached thoughtfully, strengthens rather than weakens the social fabric.

Bridging policy failures with sustainable solutions

Addressing public frustrations with immigration requires a serious reassessment of the policies that have exacerbated these concerns.

First and foremost, tackling the housing crisis through integrated planning is essential. Governments should incentivize affordable housing development and reform zoning laws to allow for higher-density projects. Recognizing the realistic timelines for construction and development, planning must begin immediately and be synchronized with immigration targets. Public sentiment strongly supports this approach. A recent Nanos Research survey found that 72 per cent of Canadians want to reduce immigration levels until housing becomes affordable.

Aligning immigration levels with the country’s capacity is crucial. Dynamic targets based on real-time economic data and infrastructure development would ensure that immigration aligns with Canada’s ability to provide services and opportunities. Returning to historical admission levels of 200,000 to 250,000 immigrants per year could help ease pressure on housing and public services. Adjusting the composition of immigration streams is equally important.

Temporary measures – such as pausing or reducing programs for international students and temporary foreign workers – could relieve immediate pressures while infrastructure catches up. For instance, although international students contributed over $30 billion to the economy in 2022, lowering their numbers could help reduce housing demand in university towns. Likewise, managing temporary foreign worker intake would address labour shortages without overwhelming resources.

Effective integration and support services must also be given priority. This should begin with implementing consistent selective immigration measures that evaluate an applicant’s potential to integrate both economically and culturally into Canadian society. Such measures would reduce reliance on extensive post-arrival support and help ease cultural tensions. According to a 2018 Angus Reid survey, two-in-three Canadians believe that greater emphasis should be placed on screening for alignment with Canadian values. However, it’s important to note that defining “Canadian values” can be subjective and risks being perceived as discriminatory.

Improvements to post-arrival services like community centres offering language classes, job search support, and cultural orientation programs are necessary to significantly ease the transition for newcomers. Research shows that when immigrants are effectively integrated, they are more likely to find employment, increasing tax contributions and reducing their reliance on social services. Additionally, well-integrated immigrants are more likely to engage in civic life, fostering social cohesion and strengthening community resilience.

Cultural diversity, while valuable, cannot be assumed to sustain itself without active support. Integration is not just about where people live or demographic representation; it also involves cultivating a shared sense of purpose and belonging. Successful integration depends on a reciprocal relationship: immigrants need the resources and opportunities to succeed, and in turn, they must engage with and contribute to the broader societal and cultural framework. Without deliberate policies that encourage community engagement, cross-cultural dialogue, and mutual respect, there is a risk that cultural diversity will falter.

Finally, responsible political discourse is crucial. Leaders must choose their words carefully, as rhetoric shapes public perceptions. By fostering nuanced and empathetic dialogue, they can bridge the gap between public concerns and policy realities, preserving national unity.

Canada stands at a crossroads. While immigration has long been one of our greatest assets, the current backlash highlights cracks in its management. This is not a rejection of immigrants – it’s a call for better policies and improved management. High immigration levels without careful planning will continue to harm our society. Our leaders now face a choice: fan the flames of division or unite the country around meaningful, evidence-based solutions.


Sonia Orlu is a Ph.D. student in Political Science at Simon Fraser University and a commentator on politics and culture. She is a contributing writer to the Macdonald-Laurier Institute.

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Alberta

Alberta and Ottawa ink landmark energy agreement

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The Governments of Canada and Alberta have signed a new agreement to more than double oil exports to Asian markets, address investment uncertainty and reduce emissions.

This new energy partnership is a critical step towards achieving Alberta’s and Canada’s shared goal of turning our country into a world energy superpower and building a stronger and more vibrant economy.

The new energy agreement includes:

  • A declaration by the federal government that an Indigenous co-owned Alberta bitumen pipeline to Asian markets is a project of national interest.
  • Agreement that the parties will work together to facilitate the application, approval and construction of a privately financed and constructed 1 million+ barrel per day, Indigenous co-owned bitumen pipeline to Asian markets through a strategic deep-water port.
  • Commitment by the federal government that it will not be implementing the federal oil and gas emissions cap.
  • An immediate suspension of the federal Clean Electricity Regulations, and agreement the parties will work towards the construction of thousands of megawatts of AI computing power, with a large portion dedicated to sovereign computing for Canada and its allies.
  • Commitment by both governments to partner with the Pathways companies to finance and construct the world’s largest carbon capture utilization and storage (CCUS) project for the purpose of making Alberta bitumen amongst the lowest emission intensity barrel of heavy oil in the world.
  • In order to achieve net zero greenhouse gas emissions by 2050, the Alberta and federal governments will design and commit to globally competitive, long-term carbon pricing and sector-specific stringency factors by Apr. 1, 2026, for large Alberta emitters in both the oil and gas and electricity sectors through Alberta’s TIER system.
  • Entering into a methane equivalency agreement by Apr. 1, 2026, with a 2035 target date and a 75 per cent reduction target relative to 2014 methane emissions levels.
  • Agreement to immediately consult and work with Indigenous partners and the Government of British Columbia to ensure their peoples enjoy substantial economic and financial benefit from the pipeline.
  • Significantly decrease regulatory uncertainty through a variety of changes to various legislation, regulation and policy.

The new agreement also demonstrates that both Alberta and Canada are focused on ways to increase the production and export of Alberta oil and gas, maximize growth in AI datacentre and related industries in Alberta, assist Canada in achieving its national security goals, create hundreds of thousands of new jobs, all while reducing the emissions intensity of Canadian oil, gas and electricity through the development and implementation of CCUS, nuclear and other emissions reducing technologies.

“This is Alberta’s moment of opportunity to take the first steps toward being a global energy superpower and show the nation that resource development and sustainability can coexist. There is much hard work ahead of us, but today is a new starting point for nation building as we increase our energy production for the benefit of millions and forge a new relationship between Alberta and the federal government.”

Danielle Smith, Premier of Alberta

Oil pipeline

An Indigenous co-owned bitumen pipeline to Asian markets will ensure the province and country are no longer dependent on just one customer to buy their most valuable resource. It is agreed this new pipeline would be in addition to the expansion of the Trans Mountain pipeline for an additional 300,000 to 400,000 barrels per day destined for Asian markets.

This agreement also allows for needed adjustments to the tanker ban when the new pipeline to Asia is approved by the major projects office, as well as amendments that ensure Alberta’s energy companies can advertise their environmental leadership and efforts throughout the world without fear of penalty.

“This pipeline is an excellent opportunity to demonstrate partnership and progress. My hope is that it will create lasting economic benefits for First Nations and strengthen the relationships that matter most — government-to-government and community-to-community. Indigenous equity ownership is shaping Canada’s economy, and when our voices help guide every decision, we build trust and a future that will support generations to come.”

George Arcand Jr, Chief, Alexander First Nation

Oil and gas emissions cap

The federal government has also committed to not implementing the oil and gas emissions cap, allowing for a massive increase in oil production and private sector jobs and moving Alberta towards its goal of reaching six million barrels per day of oil production by 2030 and eight million barrels per day by 2035.

“The Energy Accord signed today by Prime Minister Carney and Premier Smith sends an important signal that Canada’s oil and gas development is integral to the economy and is open for business. This agreement shows that Canada is taking action to address regulations and policy that are impacting competitiveness and investment.”

Tristan Goodman, president and CEO, The Explorers and Producers Association of Canada

“The Business Council of Alberta is delighted to see the removal of the oil and gas emissions cap, which was a cap on production and prosperity in Canada. Now, without the cap, Canada truly can grow energy production, export globally, and generate the investments and jobs that will help deliver a better quality of life for all Canadians.”

Adam Legge, president, Business Council of Alberta

Clean Electricity Regulations

The agreement also includes the immediate suspension of the Clean Electricity Regulations in Alberta, which will stabilize Alberta’s power grid and enable massive investments in AI data centres in the province. Instead, Alberta will work with the federal government and industry on a new industrial carbon pricing agreement, to be administered through Alberta’s TIER program.

Pathways and emissions reduction

Both governments are committed to working together with the Pathways companies to advance the completion of the world’s largest CCUS infrastructure project.

This will make Alberta a world leader in the development and implementation of emissions reduction infrastructure – particularly in carbon capture utilization and storage. Alberta bitumen will be the cleanest heavy oil on the planet displacing heavier emitting oil from Russia, Venezuela and Iran, and bringing better environmental and geopolitical outcomes.

“The Pathways Alliance appreciates the leadership of both Prime Minister Carney and Premier Smith in entering this important Memorandum of Understanding which supports the growth of an industry that is critical to Canada’s economy. We look forward to working on the details with both the federal and Alberta governments in the coming months with our shared goal of Canada being an energy superpower.”

Kendall Dilling, president, Pathways Alliance
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Carbon Tax

Canadian energy policies undermine a century of North American integration

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Energy trade with the U.S. alone is over C$80 billion more than all merchandise trade between Canada and China

Canada’s energy sector is a cornerstone of North American prosperity, but a number of federal policies have weakened its foundation over the past decade, observes a new MEI publication released this morning.

“For a century, this North American energy machine kept churning, irrespective of political winds and to the betterment of everyone on both sides of the 49th parallel,” says Taylor MacPherson, associate researcher at the MEI and author of the report. “But we can’t take it for granted; we must be steadfast in protecting this unique, mutually beneficial relationship.”

Canada is the world’s fourth-largest oil producer, fifth-largest natural gas producer, and third-largest hydroelectric generator.

Canadian exports of hydrocarbons—commodities such as crude oil, natural gas, natural gas liquids, and refined petroleum—to the United States alone totalled C$169.8 billion in 2024. This represents 22 per cent of all goods Canada exported that year.

Canada imported C$33.4 billion in U.S. hydrocarbons, representing 4 per cent of all goods imports.

“This partnership is a genuine two-way lifeline,” said Mr. MacPherson. “In the winter, U.S. gas backs up Ontario during the frigid months, while Canadian gas feeds Californian power plants in the summer, so neither country is exposed to excessive price shocks.”

The two nations have complementary market structures: for instance, Canada produces heavy crude ideal for America’s complex refineries. In the meantime, U.S. shale fields produce light oil that eastern Canadian refineries can use.

Two-way energy trade stands at over C$200 billion annually, equalling 13 per cent of all Canadian merchandise trade. This is larger than Canada’s entire two-way merchandise trade with China in 2024, which stood at C$118.7 billion.

The energy sector accounts for 10.3 per cent of Canada’s GDP in 2023 and 3.4 per cent of employment, totalling 697,000 jobs.

Employment in the sector is among the best paid in the country, with average annual compensation in oil and gas reaching roughly C$200,000, compared to just over C$75,000 across all industries.

Total contributions to government coffers from the industry are substantial, with tens of billions of dollars collected in 2024-2025, including close to C$22 billion by Alberta alone.

“This is not just money on a spreadsheet,” says Mr. MacPherson. “It is what funds our schools, our hospitals, and the services Canadians rely on. The government risks weakening our communities with its recent actions.”

Recent legislation has made the development of the energy sector increasingly difficult, which risks undermining this integration, to everyone’s detriment.

In 2019, the Impact Assessment Act replaced earlier legislation, and uncertainty created by its adoption has been reported to be a contributor to the drop in Canadian investment.

Another emerging threat has been the federal government’s proposed oil and gas emissions cap. If Ottawa were to remove it, as has been suggested, it would be removing what has long been perceived as a production cap by the industry.

Canada’s 2019 Oil Tanker Moratorium Act bans large crude and “persistent” oil tankers from B.C.’s north coast, effectively shutting the door on any major export terminal at Prince Rupert, Kitimat, or nearby ports.

“North American energy integration is a marvel of pipelines and power lines,” says Mr. MacPherson. “A confluence of harmful legislation risks toppling Canada as an energy leader, and will leave us a far cry from becoming the ‘energy superpower’ promised by Prime Minister Carney.”

You can read the Economic Note here.

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The MEI is an independent public policy think tank with offices in Montreal, Ottawa, and Calgary. Through its publications, media appearances, and advisory services to policymakers, the MEI stimulates public policy debate and reforms based on sound economics and entrepreneurship.

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