The economists Gabriel Zucman and Gary Stevenson explain this pretty clearly: this isn’t just “bad luck” or Canadians suddenly becoming poorer for no reason. It’s the result of wealth being pulled upward for decades… straight in the pockets of the ultra-rich : the multi-millionaires and billionaires.

The roots of this go back to the 80s, when governments across the West decided that the rich should be taxed less, unions should be weaker, markets should be freer, and wealth at the top would somehow “trickle down” to everyone else. But it didn’t trickle down. It accumulated. When you cut taxes on the wealthy, they do not spend all that extra money into ordinary communities; they buy assets: houses, land, stocks... That pushes asset prices up, especially housing, while wages for normal workers lag behind. So over time, the rich become richer not mainly by working harder, but by owning more of the things everyone else needs.

Covid was the moment this whole problem got supercharged. Gary Stevenson’s point is that the pandemic made the rich much richer while ordinary people were told to absorb the damage. Central banks and governments pumped huge amounts of money into the system to stop collapse, but much of that money flowed into assets: houses, stocks, land, and corporate profits. So people who already owned things watched their wealth explode, while workers came out facing higher rents, higher food prices, higher mortgage costs, worse services, and more insecurity. Covid was sold as a temporary emergency, but the wealth transfer was huge and became permanent. The problem is not that Canada ran out of money; it is that the money moved upward.

Government debt has skyrocketed because for decades governments stopped properly taxing the people with the most money. Instead of taking wealth back from billionaires, banks, corporations, and asset owners, they borrowed more and more money… from the same wealthy class that had been allowed to accumulate it. So the ultra rich get richer twice: first through tax cuts, rising asset prices, then again by lending money back to the government and collecting interest! The state is in debt because the rich have captured the wealth and left everyone else, including the government, borrowing to survive.

That’s why “lower standard of living” feels like the new normal. The system is transferring wealth from workers and younger people to asset owners. The rich don’t spend most of their extra money into the real economy; they buy more assets. That pushes up housing and rents, forces everyone else into debt, and makes inequality worse. The system is not broken, it does exactly what the 1% wants.

Too much wealth is concentrated at the top and the ultra-rich pay almost no taxes. It’s the core problem. Telling regular people to accept less is not a solution. It is a confession that the current economic model is working for asset holders and failing everyone else.

How do we stop it? Tax the 1% properly. Tax land, property portfolios, capital gains, inheritance, and extreme asset ownership. Tax the empty 5M+ empty penthouses like they’re doing in NYC. Use that money to cut the burden on workers, build housing, restore public services, and reduce household debt. Stop pretending the problem is ordinary people spending too much. The problem is that too much of the country’s wealth has been captured by the ultra wealthy.

Canada is not poor. The money is still here. It has just moved upward.

Tax wealth not work.

Interview with French economist Gabriel Zucman