Canada at the Crossroads: Reflections on 2025 and the Choices of 2026

Canada at the Crossroads: Reflections on 2025 and the Choices of 2026 by Maj (ret’d) CORNELIU, CHISU, CD, PMSC FEC, CET, P.Eng. Former Member of Parliament Pickering-Scarborough East The year 2025 will not be remembered in Canada for a single dramatic event. There was no financial collapse, no constitutional crisis, no defining national trauma. Instead, it was a year marked by something quieter and, in many ways, more consequential: a broad, uneasy realization that the country’s long-standing assumptions no longer align with reality. Canadians spent 2025 taking stock of their economy, their institutions, their social fabric, and their place in a world that feels less predictable by the month. In that sense, 2025 was a year of reassessment. The question now, as 2026 approaches, is whether reassessment will give way to resolve. A Year of Stabilization Without Momentum Economically, 2025 brought a measure of relief after years of turbulence. Inflation eased, interest rates began to drift downward, and fears of an imminent recession receded. Employment remained relatively strong by historical standards. On paper, the economy appeared stable. Yet stability did not feel like prosperity. Productivity growth remained weak, business investment lagged behind peer countries, and major projects; whether housing developments, energy corridors, or transportation infrastructure continued to move at a glacial pace. Many Canadians sensed that the economy was no longer failing loudly, but it was underperforming quietly. This gap between macroeconomic indicators and lived experience defined much of the national mood. Wages struggled to keep up with costs accumulated over previous years. Young Canadians, in particular, looked at the housing market and saw not a challenge to overcome, but a barrier to adulthood itself. Home ownership drifted from expectation to aspiration to, for many, improbability. Housing as the National Pressure Point No issue dominated Canadian life in 2025 more than housing. It was not merely an economic concern; it became a social and psychological one. Decisions about careers, family formation, and even geographic mobility were shaped by whether people could find a place to live that did not consume the bulk of their income. Federal and provincial governments announced funding, targets, and agreements. Municipalities promised zoning reform. Yet results lagged far behind need. The housing crisis revealed a deeper structural problem: Canada’s difficulty in translating political consensus into timely execution. By 2025, nearly everyone agreed that housing supply must increase dramatically. The frustration lay in how slowly that agreement turned into cranes in the sky. Politics in a More Skeptical Age Politically, 2025 was marked by sharper rhetoric and thinner patience. Canadians appeared less ideologically driven than fatigued. Trust in institutions, Parliament, the media, even parts of the public service remained strained, though not broken. Voters demanded competence more than vision, delivery more than declarations. Ottawa’s focus shifted toward long-term positioning: industrial policy, defence commitments, and strategic infrastructure. The language of resilience entered the mainstream. Canada spoke more openly about supply chains, critical minerals, Arctic sovereignty, and energy security. These were not new topics, but in 2025 they felt less theoretical and more urgent. Still, a sense of drift persisted. Governments managed problems incrementally while avoiding hard trade-offs. Fiscal pressures mounted quietly in the background, as healthcare costs rose and demographics tilted toward an aging population. Canadians sensed that the margin for error was narrowing. Canada in an Unsettled World Internationally, 2025 reminded Canadians of both their limits and their strengths. Canada was not a central actor in global conflicts, but its stability became an asset in itself. In a world of abrupt policy swings and unreliable partners, Canada’s predictability mattered. Defence spending edged upward, particularly in the Arctic, reflecting a sober recognition that geography is destiny. Climate change, great-power competition, and northern development converged in ways that made long-term neglect impossible. Canada did not suddenly become hawkish, but it became more realistic. Diplomatically, Canada leaned into niches where credibility still counts: multilateral forums, humanitarian engagement, and quiet mediation. The ambition was modest, but appropriate to a middle power navigating a fragmented international system. Society: Tired, But Intact Socially, 2025 revealed a country under strain but not fracture. Polarization existed, yet it was less explosive than in many peer democracies. Civic rituals; from Remembrance Day commemorations to local volunteerism continued to bind communities together. Immigration remained central to Canada’s identity and future, but the conversation grew more nuanced. Canadians increasingly distinguished between welcoming newcomers and acknowledging capacity limits. The challenge was no longer whether to immigrate, but how to integrate effectively through housing, credential recognition, language training, and community support. This was not a rejection of openness, but a demand for competence. The Demands of 2026 If 2025 was about recognizing problems, 2026 will be about confronting them. The coming year is likely to test Canada’s willingness to make choices rather than manage tensions indefinitely. Economically, lower interest rates may provide breathing room, but they will not restore productivity or competitiveness on their own. In 2026, pressure will grow to dismantle internal trade barriers, accelerate approvals for major projects, and align immigration more closely with labour market needs. Without such reforms, Canada risks settling into a decade of mediocre growth and declining relative living standards. Politically, the tone is likely to harden. As potential elections at various levels approach, voters will demand specificity: How many homes will be built, where, and by when? How will healthcare be sustained as costs rise? What does fiscal responsibility mean in an era of permanent pressure? The appetite for slogans is waning; the appetite for results is not. Climate adaptation will also move from abstraction to necessity. Extreme weather, aging infrastructure, and energy transitions will force faster decisions. Canadians are less interested in symbolic commitments than in practical answers: who pays, who builds, and who bears the risk. A Choice Between Drift and Direction Canada enters 2026 with remarkable advantages: abundant resources, strong institutions, social cohesion, and international trust. However, advantages unused can become illusions. The defining question is whether Canada can convert stability into momentum. The risk is not sudden collapse. It is gradual erosion; the slow fading of affordability, opportunity, and confidence that has long defined the Canadian promise. The opportunity, however, remains real. With clear priorities and disciplined execution, 2026 could mark the beginning of renewal rather than retrenchment. History suggests that Canada’s greatest moments often come not from crisis, but from clarity. The year ahead will reveal whether the reassessment of 2025 was merely reflective or whether it was the prelude to action. Enjoy the holiday season and Happy New Year for 2026 !