If you are not familiar with the saying or proverb of the story about how a horse could not carry its rider/messenger because the farrier who put the iron shoes on the horses had no nails to attach the shoe; the messenger then failed to warn the King; who then lost his kingdom to the enemy, I can appreciate that you do not make the connection between then and now. I suppose you could see a connection between horseshoe nails and the lack of electric vehicle charging stations but that’s for another column.
I was talking to a plumber who works in the GTA, and I commented on how good things looked for his profession with the Liberal’s announcement of building millions of new homes to solve the housing crisis. Well, he said, yes, we are busy right now, but this may not last: the developers are holding back on new developments, and we could have a slowdown later this year as a lot of new projects are on hold. How so, I asked, isn’t this program going to guarantee you work for several years? (Justin usually makes 10-year promises).
Not so much, it seems. When a developer plans to build a condominium or apartment block, they need to finance the project from start to finish – finish being when the income from selling or renting the units in the project comes to fruition. The project cannot start and then come to a grinding halt for any reason. Like the horse who needed that nail for its shoe.
The developer must look at the availability of not only workers but also materials. Herein lies the rub, says my plumber friend. The demand for housing, affordable housing, is not unique to Canada, and the accompanying demand for materials to build said housing is also not unique to Canada. If your development stalls because your plumbers do not have taps or valves to get water to the units, the whole project stops. Carpenters have to lay down their saws and hammers; the cement trucks stop pouring; the electricians take a break. The interest on the funding continues to accumulate.
Like the blacksmith who had to hammer out horseshoe nails, the tap-maker can only make so many per hour or day. The factory that makes the valves has an economical capacity, and their sources for the brass/copper/chromed steel likewise have limits. All down the supply chain, there are issues with sourcing materials and of course, labour. The source for the valves may be far offshore as we in America have outsourced so much to cheaper labour markets in the Far East (read China). Our GTA developer may be way down the order list, and this can put his development in jeopardy. Hence the projects are now stalling as the news reporters tell us on the national newscasts.
It seems, once again, that our government(s) are not in touch with the reality of today’s world in supply and demand. Promises and programs are made and only then do they do a reality check. E.g. Ukraine needs a modern air defence system: no prob, we’ll buy one from the United States who will buy the main components from Norway who put us on a list at #10 for delivery sometime late next year. The delay in getting the money with the order only delayed the whole thing by a few months – a few months of more missiles attacking from Russia. Somewhere down the line in Norway, there is a shoeless horse.
Admittedly, the NDP tried to get their dental plan in place back in 2019, but it took almost four years before some seniors could get their shoes nailed on, I mean teeth fixed. And, the catch was not all the horseshoe makers wanted to join the plan until they got the paperwork reduced so they could make expedient claims for the cost of horseshoe nails. Alas, the seniors who thought they would be getting free dental care found out that it was only free at 2019 rates and the inflationary rise in costs was out of their pockets. Jagmeet almost got it right. Another promise almost kept.
Here in Ontario, there was a sudden demand for beer chillers as Dougie, for a mere 26 million, gave permission to corner stores to sell cold beers and other alcoholic delights. Refrigeration manufacturers turned to beer coolers, temporarily cutting back on air conditioners for the new housing units but a short delay only slowed construction. Not to worry, the ice plant for the new double ice pad should be available when we need it. Perhaps we ought to check that because we don’t want that horse standing on three legs, waiting.
In our hometown, the slight delay in repairing Premier Road, the city’s worst/best collection of potholes in the urban area (Widdifield Station Rd is outside the urban boundaries) ran into horseshoe nail problems in finding someone to do the work – when the drawings were eventually ready. Next year. Maybe.
We, of course, are used to politicians promising things they cannot or do not deliver, but now with the supply chain issues, it becomes harder to nail things down (sorry for the pun) in a timely manner. For the sake of a nail, the country was lost, the proverb said. Our former Bank of Canada governor, Mark Carney, advised the Liberal caucus that one of the prime issues in our economic recovery (and ongoing issues) was our lack of productivity compared to other developed countries – especially to our neighbour to the south. This is becoming a theme of economists in Canada – they know we are short of nails but have only advice, not the wherewithal, to get us back on the horse.
And please do not suggest that Carney advised Freeland to offer 35-year mortgages. OMG.
Perhaps the analogy of the horseshoe is too out-of-date for today’s economics, but I wonder if some of our problems are the result of us not looking clearly enough at the details of what we are trying to accomplish. Yes, 3,000,000 new houses sound great until one realizes that our capacity to build toilets is only half that number. Communal toilets in apartment buildings? Pee schedules for the condominium? I better run that by our MP and MPP.
P.S. Justin: your local MP, still recovering from the bus running over him, has access to horseshoe nails at Gateway Hardware. Or do you still believe your Kingdom is not lost? Just saying.
