Canada Bleeding Billions: The Urgent Case for a Minimum Tax on Capital Outflows

February 8, 2026

Canada is facing a financial crisis few citizens fully grasp: hundreds of billions of dollars leave the country every year, weakening our economy, reducing tax revenues, and forcing ordinary Canadians to shoulder the burden. This is not a distant problem — it is happening right now, and the consequences touch every household.

Capital Flight in Numbers: 2000–2025

The scale of Canada’s capital outflows is staggering. Over the past two decades:

• Canadian Direct Investment Abroad (CDIA) grew from $360 billion in 2000 to roughly $2.3 trillion by 2024, with more than half concentrated in the United States. Major outflows were driven by portfolio investments, mergers and acquisitions, and reinvested earnings by Canadian companies in foreign affiliates.
• Foreign Direct Investment (FDI) in Canada grew from $320 billion in 2000 to $1.3 trillion in 2024. While Canada still attracts capital, inflows have not kept pace with outbound investments. Net FDI outflows have created a gap exceeding $1 trillion by 2024.
• Recent trends: In 2024, Canada attracted $85.5 billion in FDI, but this was followed by a 60% plunge in foreign divestment of Canadian securities by Q3 2025, showing volatility and continued capital flight.

Immediate Outflows: 2023–2025

Recent quarterly data underscores the urgency:

• June 2023: $8.3 billion left Canada, following divestments of $11.5 billion in May.
• Q2 2023 total: $43.7 billion outflow.
• Early 2025: $85.9 billion in net portfolio outflows in the first half of the year, as Canadians purchased foreign securities and foreign investors reduced exposure to Canadian assets.

These numbers are not just statistics, they are a direct threat to jobs, public services, and economic stability.

Impact on Canadians: Jobs, Productivity, and Public Services

Capital flight is not abstract. It affects every Canadian.

• Productivity and wages: Investment per worker in Canada has fallen 20% compared to U.S. workers between 2006 and 2021. Canadian workers now receive only about 55 cents of new capital for every dollar received by U.S. counterparts, reducing productivity and wage growth.
• Public services: Less domestic capital translates into fewer resources for hospitals, schools, and infrastructure projects. Ordinary Canadians pay the price while wealth exits the country.
• Economic competitiveness: Sustained outflows have slowed the growth of domestic industries, machinery, equipment, and intellectual property, leaving Canada less competitive globally.

Every dollar leaving Canada is a dollar not funding healthcare, education, or economic growth.

The Case for a Minimum 15% Tax on Outflows

A minimum 15% tax on money leaving Canada is a practical, enforceable, and necessary policy:

1. Recover lost revenue: If $500 billion leaves annually, a 15% levy could recapture $75 billion, funds that could directly support public services and infrastructure.
2. Reduce tax avoidance: Wealthy individuals and corporations often shift money offshore to dodge domestic taxes. A minimum exit tax levels the playing field.
3. Encourage domestic investment: Taxing outbound capital incentivizes reinvestment at home, creating jobs and fostering economic growth.

Designing a Fair and Effective System

Implementation must balance enforcement with economic competitiveness:

• Tracking and enforcement: Cover corporate structures, offshore accounts, and complex financial instruments, including cryptocurrency.
• Exemptions: For legitimate trade, approved investments, and profit repatriation to protect normal business activity.
• Tiered rates: Target repeated or exceptionally large outflows, minimizing impact on ordinary Canadians.
• Integration with existing taxes: Avoids double taxation and ensures fairness.
• International coordination: Align with treaties and regulations to prevent simple rerouting of capital abroad.

Why Action Is Urgent

This is not a short-term problem; it is a structural issue that has persisted for decades. Capital flight drains Canada’s wealth, undermines competitiveness, and reduces public services. Waiting is not an option, every year of inaction compounds the problem, costing Canadians more and weakening the economy.

Call to Canadians and Policymakers

It’s time for Canadians to demand accountability. Capital flight is not just an economic statistic — it affects hospitals, schools, and jobs. A minimum 15% exit tax is responsible, fair, and necessary. Wealth generated in Canada should benefit Canada first. Every dollar leaving the country without contributing back is a dollar lost to families, communities, and the nation’s future.

Stop the hemorrhage. Protect our economy. Protect Canadians. Act now.

This discussion draws from the enduring themes of Freedom, Reason, and Responsibility, exploring how societies thrive when individuals and leaders take ownership of decisions, and falter when responsibility is outsourced to systems or narratives. Canada’s capital flight is more than an economic statistic; it is a reminder that civic responsibility and accountable leadership are essential to prosperity. These lessons remain relevant not just today, but for any moment when the choices of a few can shape the well-being of many.

 

What We Were Warned About and Ignored

Gangs, Violence, and the Cost of Denial in Toronto and Across North America (2026 Update)

More than a decade ago, many citizens warned that Toronto — like other major North American cities, was drifting toward a dangerous tolerance of disorder. Those warnings were often dismissed as exaggerated, politically incorrect, or alarmist.

They were not.

What we are witnessing today is not a sudden breakdown, but the predictable result of years of denial, leniency, and institutional avoidance of responsibility. Crime did not appear overnight. It evolved, while policymakers looked away.

A Failure of Enforcement, Not of Law

Canada does not lack laws. Toronto does not lack police officers. What it increasingly lacks is the will to enforce consequences consistently and visibly.

Gang-related violence, illegal firearms, drug trafficking, and organized criminal activity have continued to spread across neighbourhoods once considered stable. Yet public messaging has often minimized the scope of the problem, treating it as isolated incidents rather than as a systemic pattern.

When repeat offenders are released quickly on bail, when sentencing fails to deter, and when responsibility is fragmented across courts, commissions, and political talking points, criminal networks adapt faster than institutions do.

The victims, families, local businesses, and law-abiding residents, are left to absorb the cost.

Political Denial and Judicial Drift

For years, citizens were told that acknowledging gang activity risked “stigmatization,” that enforcement itself was the problem, and that social spending alone could substitute for accountability.

That theory has failed.

Compassion without consequence does not produce rehabilitation; it produces recidivism.
Justice that prioritizes process over public safety erodes trust, not only in courts, but in democracy itself.

Judicial systems exist to balance rights and responsibility. When that balance collapses, the public does not become safer, it becomes more cynical and more disengaged.

Responsibility Cannot Be Outsourced

Education and employment matter. Early intervention matters. But pretending that all criminal behaviour is merely a social abstraction, detached from individual choice, is both dishonest and dangerous.

A society that removes agency from offenders while demanding endless patience from victims reverses moral accountability.

Personal responsibility is not a harsh concept; it is a civilizing one. Without it, no amount of funding, programming, or rhetoric can restore order.

The Democratic Deficit

One of the most troubling developments over the past decade has been the transfer of real decision-making power away from elected representatives and toward unelected bureaucratic and technocratic structures.

Policies affecting policing, sentencing philosophy, and public safety are increasingly shaped by committees, agencies, and interest groups that face no direct electoral accountability.

This democratic distancing allows politicians to evade responsibility and courts to drift from public confidence, while citizens are told their concerns are “misinformed” rather than addressed.

Multiculturalism Without Civic Integration

A successful pluralistic society depends on a shared commitment to civic norms: respect for law, acceptance of equal responsibility, and allegiance to democratic rules.

When integration is replaced by permanent grievance politics, when cultural identity is treated as an exemption from civic obligation, social cohesion fractures.

This is not a failure of diversity. It is a failure of leadership to insist that rights and responsibilities are inseparable.

We Have Seen This Before

Cities across North America offer clear warnings: Detroit, Oakland, Chicago, St. Louis, Flint. The pattern is consistent:

1. Rising violence is denied

2. Enforcement is constrained

3. Victims are deprioritized

4. Institutions lose legitimacy

5. Recovery becomes exponentially harder

Toronto is not immune to history — but it still has a choice.

The Question We Can No Longer Avoid

The real question is not whether crime exists, it does.
The question is whether our leaders, courts, and institutions have the courage to confront it honestly.

Not with slogans.
Not with denial.
But with law, responsibility, and democratic accountability.

We were warned.
We debated.
We delayed.

The cost of continued inaction will not be paid by politicians or bureaucrats, it will be paid by ordinary citizens who did everything right and are increasingly told they must simply endure the consequences of institutional failure.

Author’s Note (2026)

This updated reflection aligns directly with the themes explored in my book, Freedom, Reason, and Responsibility. The central argument remains consistent: societies do not fail for lack of ideals, laws, or resources, they fail when responsibility is diffused, reason is subordinated to ideology, and freedom is separated from accountability.

The concerns raised here are not partisan, nor are they new. They are grounded in a decades of public service, civic leadership, and observation of institutional decision-making. This update is offered not as hindsight, but as a reminder that warnings ignored do not disappear, they mature into consequences.

If Freedom, Reason, and Responsibility asks what sustains a democratic society, this article examines what happens when those principles are deferred, diluted, or denied.

Canada’s Strength Lies in Realism, Not Rhetoric

January 22, 2026

Mark Carney’s soaring nationalism and moral appeals play well abroad — but at home, they drift from Canada’s real challenges.

Prime Minister Mark Carney’s address at the Citadelle of Quebec was crafted for history books a tapestry of symbolism, pride, and unity. Standing on ground once soaked with the blood of empire, he invited Canadians to see themselves as heirs to cooperation and moral courage. In his telling, Canada is not merely a country but an idea a living counterpoint to populism, nationalism, and authoritarianism.

Inspiring, yes. But history, economics, and reality tell a more complicated story. What Carney delivered in Quebec was less a policy vision than a political sermon one that glosses over nuance, inflates virtue, and misjudges the geopolitical ground beneath our feet.

Myths of Harmony

Carney’s retelling of the 1759 Battle of the Plains of Abraham as a turning point toward “coexistence” between French and English Canada reads like mythology. Cooperation was not a choice peacefully arrived at but the outcome of centuries of friction, negotiation, and political calculation. The path from conquest to Confederation was marked by deep divisions linguistic, religious, and cultural, from the Durham Report to the Conscription Crises. Canada’s unity was hard-earned and uneven, not the inevitable flowering of mutual goodwill.

By rewriting conflict as cooperation, Carney romanticizes the past at the expense of historical truth. Canada’s greatness has come not from harmony, but from the determination to maintain unity despite constant tension. It is a more difficult and more honest story.

The U.S. and the Illusion of Detachment

Carney’s most defiant moment came in his pointed message to Donald Trump: “Canada doesn’t live because of the United States. Canada thrives because we are Canadians.” It’s an applause line that resonates emotionally but economically, it strains belief.

For better or worse, Canada’s prosperity is built on interdependence, not independence. Roughly three-quarters of our exports flow south. Our energy grid, manufacturing supply chains, and financial systems are tightly integrated with the U.S. economy. Our defense strategy relies on binational cooperation through NORAD and NATO. This is not dependence, but partnership one that has underpinned our stability and prosperity for over a century.

Pretending otherwise weakens credibility. Leaders strengthen alliances intelligently; they don’t undermine them theatrically. When Carney casts Canada as morally superior to its most vital ally, it plays well on international stages but risks sounding performative at home.

Noble Ideals, Tangible Shortfalls

Carney’s rhetoric about inclusivity, fairness, and sustainability aligns with Canada’s self-image but ideals cannot substitute for execution. Canadians today face worsening affordability, housing scarcity, and growing productivity gaps. The moral vocabulary of leadership must eventually yield to the mechanics of policy: how to build, hire, innovate, and invest.

Canadians don’t need more “values-based leadership.” They need a government that can translate values into measurable progress that turns slogans into solutions.

The Rules-Based Order and Quiet Power

Carney’s lament for the “death” of the rules-based international order may sound principled, but it ignores Canada’s historic role as a beneficiary of that very system. The postwar order, forged largely by the United States gave Canada safe passage to prosperity, secure markets, and diplomatic influence disproportionate to its size. If that system is crumbling, Canada’s response must be strategic, not rhetorical.

Middle powers exert influence through alliances and competence, not grandstanding. If Carney wants to redefine Canada’s place in the world, he must start by answering the practical question: with what leverage?

A Fortress Without Foundation

Choosing the Quebec Citadelle, a fortress built to defend against an American invasion that never came, as the site of a “Cabinet Planning Forum” was no accident. The symbolism is clear: Canada as independent citadel, morally steadfast against external pressure. But the enduring challenge of leadership is not to reimagine ancient battles, it is to win the present ones. And those battles are economic, institutional, and social, not rhetorical.

Canadians need more than moral clarity. They need functional governance, policies that restore productivity, strengthen public services, and ensure national unity through competence, not ceremony.

The Measure of Leadership

Carney’s speech may have drawn ovations abroad, but at home it exposed a familiar pattern: Canada’s political class mistaking eloquence for effectiveness. A country defined by humility and pragmatism now finds itself led by spectacle and symbolism. There is nothing unpatriotic about expecting more.

True leadership faces reality head-on, it builds trust not through lectures but through delivery. Patriotism, after all, is not performance; it’s perseverance.

 

Nothing Is Free: Kingston’s “Fare-Free” Transit Fantasy Is a Permanent Tax on Permanent Residents

 January 22, 2026

There is no such thing as free public transit. There never has been. What is being marketed to Kingston residents as “fare-free” transit is, in reality, a permanent and expanding tax transfer from homeowners, renters, and local businesses to selected user groups, many of whom are not permanent residents of the city.

The City of Kingston already subsidizes transit heavily. In 2025, transit operating costs sit at approximately $35.8 million, while fares recover only about $10.7 million, or roughly 30% of costs. The remaining $19 million is already paid by taxpayers through property taxes and provincial transfer. Kingston residents are not debating whether to subsidize transit, they already do. The debate is whether to eliminate fares entirely and replace them with a permanent tax increase.

Eliminating fares does not eliminate costs. It eliminates accountability.

The Real Price Tag of “Free”

According to the city’s own financial projections, going fare-free would remove $10.7 million in annual fare revenue. Higher ridership would then drive operating costs up by an estimated 10–30%, pushing the net annual shortfall to $12–18 million every single year, indefinitely.

With Kingston’s total tax levy at approximately $289.5 million, covering even a mid-range $15 million gap would require a 5% tax increase. For the average household, that translates to $100–150 more per year and for many, more once inflation and service expansion are factored in.

And that’s before overcrowding, security costs, fleet expansion, or capital strain are considered.

Students Already Pay Far Less and Not Year-Round

Proponents of fare-free transit frequently point to student ridership, but omit a critical fact: students already receive deeply discounted transit and only pay for part of the year.

For the 2025–26 academic year:

• Queen’s University students pay $165 per year
• St. Lawrence College students pay about $190 per year

These fees buy unlimited transit access, but only while students are enrolled typically 5 to 6 months of actual residency in Kingston.

By contrast, permanent Kingston residents pay full fares 12 months a year, regardless of income, residency duration, or usage. A working adult purchasing a monthly pass pays $83 per month, or nearly $500 for six months, more than double what most students contribute for the same period.

This is not a minor imbalance. It is a structural subsidy from permanent residents to temporary populations.

The Ridership Myth

Advocates often claim fare-free systems produce 20–60% ridership increases. That argument does not hold in Kingston.

Why? Because Kingston already has:

• Free transit for children under 14
• Free high-school passes
• Subsidized low-income passes
• Deeply discounted university and college bulk programs

The “low-hanging fruit” has already been picked. Even city modeling shows that eliminating fares would not produce transformative gains without significant new service expansion, which itself drives costs higher.

A City Already Facing a Transit Shortfall

Kingston Transit is already short $600,000 in projected revenue for 2025, largely due to declining international student enrollment. Despite this, the operating budget was increased to $19.6 million, routes were expanded, and provincial gas-tax reserves were tapped to keep pilots afloat.

In other words, the system is not over-funded. It is already fragile.

Moving to a fare-free model at this moment is not progressive, it is fiscally reckless.

Who Really Pays

When fares disappear, costs do not. They simply migrate:

• Into higher property taxes
• Into business levies
• Into hidden charges embedded elsewhere in the budget

Homeowners cannot opt out. Renters pay through higher rents. Small businesses absorb higher fixed costs. And once fares are gone, they never return.

Temporary users come and go. Permanent residents stay, and pay.

A Smarter Path Forward

Kingston’s targeted programs work precisely because they are limited, measured, and funded:

• Youth and high-school passes deliver strong social returns
• Low-income programs improve access without blowing the budget
• Student bulk agreements are transparent and contractual

Expanding these programs where evidence supports them is responsible governance. Eliminating fares entirely is not.

Conclusion

“Free transit” is a slogan, not a solution. In Kingston, it would mean higher taxes, reduced transparency, and permanent cost transfers onto those who already pay the most.

Nothing is free. Someone always pays.

The only honest question is: who, and for how long?

And in Kingston’s case, the answer is clear: Permanent residents would pay, forever.

Let me be clear: removing fares does not make transit free, it makes it unaccountable. It shifts permanent, escalating costs onto homeowners, renters, and local businesses who already subsidize the system, while many beneficiaries contribute little, temporarily, or not at all. Once fares are eliminated, they will never return, but the taxes will.

Council is not voting on generosity today; it is voting on whether to impose a permanent tax increase disguised as compassion. Kingston residents deserve honesty, not slogans, because in public finance, nothing is free, and pretending otherwise is not leadership.