Author Linda McQuaig says The Tenant Class “will leave you realizing that the housing market operates just as it’s meant to—in the interests of landlords. That won’t change by offering ever more generous incentives to builders but by tenants taking collective action—and Tranjan provides an inspiring account of the little-known history of such collective action in Canada, dating back to before Confederation.”
Ricardo Tranjan is a political economist and senior researcher with the Canadian Centre for Policy Alternatives. Previously, Tranjan managed Toronto’s Poverty Reduction Strategy and taught at universities in Ontario and Quebec. His early academic work focused on economic development and participatory democracy in Brazil, his native country. His current research is on the political economy of social policy in Canada. Ricardo holds a PhD from the University of Waterloo, where he was a Vanier Scholar. A frequent media commentator in English and French, he lives in Ottawa.
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We’ve been hearing for years about how challenging it’s become for folks all across the country to find decent, affordable, and safe housing. Why is this?
The short answer is that these days, housing doesn’t exist for its own sake, that is, to house people; it increasingly exists to generate profit for investors. There has always been profit in the housing business, and there have always been people who paid too much in rent, but in recent times the role of profit in housing increased and governments have chosen not to restrain it. The result is that tenant families are transferring a large and growing percentage of their incomes to landlords and real estate investors.
One surprising thing about the book is that you consciously avoid using the term “housing crisis” when describing the housing situation in Canada today. Can you share more about why that is?
Characterizing Canada’s housing woes as a crisis is inaccurate, if not disingenuous. Our housing system is built on largely unregulated markets. Markets don’t generate social goods like clear air, literacy, or housing security. Markets generate wealth. The rental housing market generates profit and capital gains for landlords and investors, that’s what it does, with amazing efficiency.
The negative effects of governments’ choice to rely on private markets to deliver rental housing while failing to regulate them—namely skyrocketing rents are epidemic housing insecurity—are borne exclusively by tenant families and people who are unhoused. This is not a crisis. This is structural inequality.
What’s the most shocking piece of data or information you found when researching the book?
I wouldn’t say I was shocked by anything I uncovered in my research, but one thing that impressed me was that Canada has such a long tradition of tenants fighting back against exploitative landlords. Tenants were staging rent strikes before Confederation, and they are doing it today. Landlords have always tried to extract the maximum from tenants, and it was only because of decades of tenant resistance, which became political pressure, that Canadians created the limited protections for tenants that we do have.
Part of the challenge you offer readers (including journalists) is to pick a side between the landlord class and the tenant class. What would you say to families who absolutely rely on income from a rental property or basement suite to pay their own mortgage?
A fundamental theme of my book is that there’s no such thing as neutrality. People who refuse to take sides are really saying that the status quo is fine. In the case of rental housing, where the status quo so lopsidedly favours landlords, refusing to take sides actually means standing with the powerful. It means supporting continued exploitation. As a public relations strategy, corporate landlords love to hide behind this notion that landlords are mostly “mom and pop” operations where grandma would lose her house if she didn’t rent her basement out to students, but in Ontario, where I live, only one per cent of landlords fall into this category (which StatsCan calls investor-occupant). It’s not an accurate depiction of the industry, and it can’t be the basis for housing policy.
In a nutshell, what needs to happen in Canada in order to properly house folks experiencing housing insecurity?
A lot of politicians are wringing their hands about housing but the mainstream solutions being proposed are really technical tweaks. Politicians are not willing tackle the root problem, which is profit. For a long time now we’ve seen tenants pumping ever-larger amounts of money into the pockets of landlords and investors. Any strategy to fix the system must reverse the flow of dollars. Policy-wise, that means strict rent controls and deliberate investment in non-market housing, because if the market itself is the problem—and it is—then there is no market-based solution to the problem.
There is no lack of ideas on how to implement these non-market solutions. The real problem is that progressives lack the political power to push back against landlords and the large segment of the political class defending their interests. Building that power should be our focus.
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Excerpt from The Tenant Class
Why, then, are "housing crisis" and “supply-side arguments” so prevalent? Canadian political economist Robert Cox famously said, "theory is always for someone, for some purpose." He was criticizing studies that take the existing social order and institutions as a given. As he called them, problem-solving theories don't ask how things came to be, who benefits from the way things are, or whether things could be different. Instead, the focus is on smoothing out any troubles with the existing institutions. By not only accepting but helping to troubleshoot the current order, problem-solving theories legitimize and entrench the status quo. While priding itself on being value-free and offering practical solutions to concrete problems, this type of research serves the interests of those who are comfortable with the way things are and would rather avoid substantive changes.
Most housing research adheres to this problem-solving approach, and in doing so, it serves the interests of the real estate industry. If we believe lack of supply is the cause of lack of housing affordability, the solution is building more. If we build more but rents continue to go up, we must not be building enough. Build more, faster! How? Governments must provide financial and regulatory incentives to developers and remove rent controls, so that landlords find the business more attractive. The supply-side argument serves a clear purpose: to sweeten the deal for developers and landlords. The argument has been made for decades; it has justified countless subsidies for the real estate industry, it has not lowered rents, but it will not go away either. An argument that so directly supports the interest of an influential economic elite is not going anywhere, no matter how much empirical evidence is mounted against it.
The widespread use of "housing crisis" also helps to preserve the status quo. It reinforces the idea that Canada's housing system worked well at some point, but something unexpected happened, bringing about unseen and widely undesirable outcomes. That's not true. For a large share of the population, the housing system never worked, and the current state of affairs is making lots of people rich, like very rich. It's not really a crisis if it has lasted more than a century and large sectors of the population wouldn't have it any different, is it? Still, the housing debate in Canada centers on finding innovative, effective, evidence-based solutions to this so-called crisis. Years come and go. Public consultations lead to expert reports that call for more public consultations. The only outcome of this policy merry-go-round is to conceal the power politics behind housing…
This book puts forward an alternative, critical perspective of the so-called housing crisis. It contends the rental market works as markets are supposed to work. Laws and law enforcement protect property rights over land dispossessed from Indigenous peoples, creating private property and providing the basis for a housing market. In this market, landlords appropriate a large share of workers' incomes, accumulate, reinvest, and come back for more. They get wealthier everyday while tenant families fall behind. There is no invisible hand hiking up rents and forcing tenants out. That hand is the hand of a landlord resolutely extracting income from workers. Rents don't go up. Landlords raise rents.
From this perspective, the solution is political, not technical. The response to structural inequality is rebalancing power between social groups (or social classes) so that one can no longer exploit the other. Asking pretty please usually doesn't work. Bosses and landlords do not renounce profit and wealth. Historically, the working class made gains through organizing on the ground, pooling resources together, amassing the power to confront bosses and demand better wages and working conditions. The same is true for the tenant class: its economic and political gains are the fruits of organizing, resisting abusive practices, and confronting landlords and the governments that side with them. It takes a struggle. It always has.
Reprinted with permission of the author.