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FIRST READING: Canadian talent (and money) is fleeing to the U.S.

FIRST READING: Canadian talent (and money) is fleeing to the U.S.

National Post4 days ago
First Reading is a Canadian politics newsletter curated by the National Post's own Tristin Hopper. To get an early version sent directly to your inbox, sign up here.
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This month, one of the world's most well-known Canadian residents finalized his plans to leave Canada for good.
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The term 'famous Canadian' almost always describes someone who no longer lives in the country of their birth. Neil Young, Justin Bieber, Malcolm Gladwell, Ryan Reynolds, Alanis Morrissette; all of them live full-time in the United States, and have done so for years.
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Until recently, Jordan Peterson was an exception. He could sell out stadiums in Europe and pen best-selling books in the United States, but his home base remained Toronto, where he retained his position as a psychology professor at the University of Toronto.
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But with Peterson officially putting his Toronto home up for sale as part of a permanent move to Arizona, he's effectively severing his last physical tie to Canada in what he's described as a ' painful parting.'
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And news of the Peterson sale happened to break in the same week that another prominent figure announced that he was reluctantly abandoning his Canadian address. In a widely circulated op-ed for the National Post, Vancouver Jewish community leader Michael Sachs said he could no longer justify raising his family in Canada when the U.S. was an option.
'I have received multiple death threats over the last few years for advocating for my community. For my family, the luxury of patience has run out and our confidence in Canada's political leadership is gone,' he wrote.
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Both Peterson and Sachs have their own political reasons for leaving, but they're part of an accelerating trend. Canada has always struggled to stop capital and top talent from fleeing abroad, but what was once a steady trickle of people leaving may be ramping up.
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In a Thursday social media post, the chief operating officer for Shopify, Kaz Nejatian, said he had multiple Jewish friends tell him their plans to leave.
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'They say they no longer feel safe sending their kids to school here,' he said.
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That same day, the U.S.-based National Review profiled several Jewish Canadians who were either mulling a move to the U.S. for safety reasons, or had already done so. They included veteran Conservative political organizer Georgann Burke, who cited noticeable increases in both antisemitic hatred and anti-American hatred. 'I have received a series of really nasty emails. One was from someone who actually threatened to kill me,' she said.
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Another, Toronto real estate developer Avi Glina, characterized Canada's steep rise in Jewish hate not as something distinct from the country's various economic ills, but a symptom of it.
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'Antisemitism is a symptom of a broken economy and nation state,' he said.
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As far back as 2022, U.S. data was showing a noticeable spike in Canadians moving across the border. When that year's incoming Canadians were compared against outgoing Canadians, the U.S. Census Bureau determined that they had taken in a net 42,825 newcomers. It was the fastest growth in Canadian immigration they'd seen since 2013.
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And Canada's own figures are also tracking a spike in departures.
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In the first three months of 2025, Statistics Canada counted 27,086 emigrants permanently leaving the country. That's up from 25,394 in the first quarter of 2022.
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Emigration figures include both citizens and permanent residents, so some of those departures may include recent immigrants who are ditching Canada for new horizons.
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But regardless, it represents a near-unprecedented rate of established Canadians deciding they don't want to live here anymore.
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'Aside from a spike in 2017, this is the highest sustained outflow since the 1960s,' reads an analysis of the emigration figures by Better Dwelling.
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Over the 12 months preceding the April federal election, a total of 106,900 were added to the Canadian emigration rolls. On whatever day that Peterson finally left Canada for good, he would have been among about 300 Canadians doing the same.
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Canada's chief weakness in retaining talent and money is economic.
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In fields ranging from engineering to law, the average Canadian professional can not only make more money in the United States, but face dramatically lower housing prices and cost of living expenses.
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The disparity has long been most obvious in the tech sector. In some years, the University of Waterloo's software engineering department has immediately lost up to 85 per cent of its graduates to jobs in the United States.
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As one Canadian engineering student put it in a lengthy 2022 blog post about the Canadian brain drain, ''Cali or bust' and 'US or bust' are common terms I heard throughout my undergrad in engineering.'
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The two countries used to be much more comparable for housing and wages, but the last 10 years have seen U.S. per-capita GDP surge ahead of Canada, while Canadian housing unaffordability has simultaneously surged ahead of the U.S.
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And if Canada's economy is scaring away people, it's also scaring away money. A Thursday update by Statistics Canada confirmed that both Canadian and foreign investors have been feverishly divesting from the Canadian economy, with $83.9 billion having been divested from Canadian securities in just the last four months.
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According to Statistics Canada, a lot of that divested money was being poured into the United States instead.
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One of the most illuminating polls from Canada's current trade war with the United States was a January survey finding that four in 10 Canadian young people would vote to dissolve their country if it meant that they could receive U.S. citizenship.
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The question was whether respondents would vote for Canada to become a part of the United States provided the U.S. 'offered all Canadians full U.S. citizenship and a full conversion of the Canadian dollar and all personal financial assets into US dollars.'
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The cohort that liked the idea more than anyone else was Canadians under 34; 43 per cent said they would trade their country's sovereignty for such a deal.
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Ottawa warned early in new year of wheels wobbling on $100 billion EV strategy
Ottawa warned early in new year of wheels wobbling on $100 billion EV strategy

National Observer

time2 hours ago

  • National Observer

Ottawa warned early in new year of wheels wobbling on $100 billion EV strategy

The federal government was warned early in 2025 that its $100 billion electric vehicle strategy was in danger of being run off the road by slowing North American EV sales and the economic mayhem sown by US President Donald Trump's tariffs on Canada, a newly released document reveals. François-Philippe Champagne, then federal minister of Innovation, Science and Economic Development Canada, was sent a briefing note on Jan. 10 by his deputy minister, Philip Jennings, that flagged 'a decline in expectations' among EV makers that imperiled the plan's progress. 'The slowdown in growth has contributed to delays, modifications, or scaling back of planned investments' in the auto sector despite tens of billions of dollars in investments having already been announced, Jennings said in the document obtained by Canada's National Observer through an access to information and privacy request. The briefing note was delivered to Champagne only weeks after he told CNO that critics of the government's embattled EV strategy lacked 'vision and ambition.' Champagne was named Minister of National Revenue in a cabinet shuffle after the Liberals won the April federal election that also saw Mélanie Joly take over the Industry, Science and Economic Development portfolio. Developing an EV industrial ecosystem from mining critical minerals used in vehicle batteries to new assembly lines for electric vehicles would give Canada a competitive advantage in a global industry 'for decades to come — but not overnight,' Champagne said in December. Joly's office told Canada's National Observer that it 'recognizes the sector's concerns and is continuing to engage meaningfully with industry stakeholders to address and alleviate challenges' linked to US tariffs, though no specific action plan was outlined in its response. 'Despite short-term policy fluctuations, the long-term trajectory for EV adoption remains strong,' says Dunsky Energy analyst Lindsay Wiginton 'Our government is working to ensure EVs are made in Canada, so Canadian workers benefit from the growth and jobs in this industry," said a spokesperson. Canada's EV plans going flat? A total of $46.1 billion in investments across the Canadian EV supply chain was announced by automakers including Honda, Volkswagen, GM and Ford from October 2021 to April last year. Federal and provincial governments pledged $52.5 billion in incentives, tax breaks and other support, according to Canada's Parliamentary Budget Officer, which provides economic analysis to the government. But dark skies have threatened the EV strategy and long-term future of auto manufacturing in Ontario as the Canada-US trade war drags on. In April, GM shuttered its CAMI assembly plant in Ingersoll, Ont., where it builds an electric delivery van. GM expected to reopen the plant at 'half capacity' in the fall. Ford and Stellantis, which cited tariffs as a major factor in a $3.7 billion loss in the first half of 2025, have also suspended or delayed EV production in Canada. Some 40,000 EVs have been produced to-date in Canada, which in 2024 imposed a 100 per cent tariff on imports of Chinese EVs to protect the domestic industry. China made 12.4 million electric cars last year, accounting for 70 per cent of global EV output, according to the International Energy Agency. Battery makers have hit speed bumps too. A planned $7 billion EV manufacturing plant in Saint-Basile-le-Grand and McMasterville, Que, collapsed after Swedish battery maker Northvolt declared bankruptcy in March. The Quebec government lost a $270 million investment in the project. More recently, trouble emerged at the $5 billion NextStar EV battery factory being built by Stellantis and South Korea's LG Energy in Windsor, Ont. Several Canadian contractors have filed lawsuits alleging millions of dollars in unpaid work at the plant, which has received $15 billion in federal and provincial incentives, according to media reports. Jennings said in his briefing note that slowing EV purchases had 'created doubt in the trajectory of [future] sales'. Trump's executive orders soon after taking office to scrap Biden-era EV targets and tax credits, along with the end of federal EV incentives in Canada, have 'added uncertainty' in the market, the note said. 'In the long-term these impacts on their own are unlikely to jeopardize the prosperity of the automotive sector in Canada, but they depend on the electrification plans of the manufacturer and the health of the sector overall, including the impact of potential U.S. policies and tariffs,' Jennings said. EV transition 'unstoppable' The federal government should stick to its long-term plan for an EV supply chain in Canada because the global shift to EVs is 'unstoppable,' said Matthew Fortier, CEO of Accelerate, a Toronto-based zero-emissions vehicle industrial alliance. There are signs of 'underlying momentum' for Canada's EV industry, said Lindsay Wiginton, managing consultant at research house Dunsky Energy. She noted many analysts have a positive global EV outlook, including projections that a quarter of all cars sold in 2025 will be electric. That growth is 'driven in large part by the continued decline in lithium-ion battery costs that is helping to bring more affordable EV models' to market, she said. 'Despite short-term policy fluctuations, the long-term trajectory for EV adoption remains strong,' she added. Some auto makers are less optimistic. They want the federal government to drop a mandate for EVs to make up 20 per cent of cars sold in Canada by 2026 and 100 per cent by 2035 – arguing that slowing EV sales and US tariffs have delayed efforts to build an electric vehicle supply chain. Ontario Premier Doug Ford, speaking at a joint press conference on Tuesday with Alberta's Danielle Smith and Saskatchewan's Scott Moe, said: 'We have to get rid of these mandates. The companies won't be able to meet these targets. But let's not stop spending. I am confident that the EV sector will grow eventually.' Environment Minister Julie Dabrusin has been unswayed by their arguments so far, according to media reports. Canada's 'competitive advantages' Fortier said Canada's automotive sector cannot hope to be 'globally relevant in 10-15 years' unless Ottawa focuses on 'competitive advantages that our neighbours don't have' in areas including critical minerals, advanced industrial materials, and EV battery technology. 'If we do that now, Canada can become a necessary part of the continental supply chain, and we can have leverage in the auto sector when EVs are the dominant mode of vehicle production in North America,' Fortier said. The US is by far the biggest market for Canadian-made cars and trucks, with 93 per cent of the $51 billion in vehicles exported in 2023 shipped south of the border, according to the Canadian Vehicle Manufacturers' Association, an industry trade body. The US imposed a 25 per cent tariff on Canadian auto makers and parts manufacturers in April, forcing hundreds of job losses in Ontario, the industry's historic heartland. Trump has threatened to raise the tariffs to 35 per cent on Aug 1. A high-profile US-Japan trade deal announced today (Wednesday) will see the US tariff on Japan's auto sector lowered to 15 per cent from 35 per cent. That deal might point to a possible reduction in US tariffs on Canadian car makers, but it is not a long-term solution, Fortier said. 'Any standing tariff on Canadian-made cars is a reminder that we urgently need to develop more negotiating leverage. The way to do this is to build upstream and midstream capacity for the batteries that will power the future of this sector,' he said.

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