President Trump’s jokes about Canada as the 51st state helped fuel the Canadian electorate’s foolish preference for Mark Carney and the Liberals last year. However, there is a real estate deal that could be done with Canada that would greatly increase human happiness: give California to Canada and in return receive British Columbia and Alberta. British Columbia has just voted Conservative by a thumping majority, Alberta is perpetually Canada’s most conservative province, while California is so wedded to Democrat leftism it is falling apart. Win-win-win for the inhabitants of the states/provinces concerned, who would achieve their political dream. And, silently, it would be a very good political-economic deal for the United States. I will explain why.

At first sight, the U.S. would appear to lose on the deal. California had a GDP per capita of $108,000 in 2025, compared with the United States’ $90,000. With California’s population being 39 million, 11.5% of the U.S. total, the U.S. would lose close to $2,000 in average GDP per capita if California were sawn off. Conversely, Alberta’s GDP was only 72,000 dollars and British Columbia’s 56,000 dollars, while their populations are only 5.1 million and 5.7 million. Making it even worse, the Canadian per capita figures are in Canadian dollars, worth only US$0.71. You have to use a higher conversion rate than that, because Canadian costs are lower, but even at 0.8, Alberta’s GDP per capita is only US$58,000 and British Columbia’s US$45,000.

Add those two provinces to today’s United States and even though combined they have only 3.2% of the U.S.’s population, you would lower average U.S. GDP per capita by about $1,500 – so you would lose $3,500 by making the pair of changes. For Canada, the changes would be magical – you would add about 70% to its population to 70 million, and would raise Canada’s GDP per capita by about $20,000, roughly speaking. Thereby, it would finally raise Mark Carney’s economic weight in world conclaves at least modestly closer to his self-regard. With that and California’s bountiful hot-weather beaches, it’s hard to imagine Canada not leaping at the prospect!

That is a static analysis, which might attract a leftist and egotistical Canadian politician but should not deter a rational free-market American. The average GDP per capita of a region is not relevant to areas outside that region, except in that removing the region may lower their ability to trade with the region. California’s $108,000 average GDP per capita is not of the slightest interest to non-Californian Americans, except that losing California may lessen their ability to export products to California which they produce and California does not, such as oil and automobiles, while imports from California such as tech equipment and almonds may become more expensive in their locations through tariffs and import formalities.

However, that is looking only at short-term effects. In the long term, the prosperity of an area is determined by the quality of the politicians it elects, especially in terms of their economic policies. Good politicians with sound economic policies will attract migrants to the state who wish to live in a free society; those will generally be the most productive migrants. Bad politicians who throw welfare around, raise taxes excessively or allow in multitudes of illegal immigrants will find their most productive citizens migrating elsewhere.

In California’s case, that is what has been happening for the last decade or more. With a gigantic population of immigrants, legal and illegal, and an almost equally large population of downwardly-mobile gentry leftists in the big cities, there is no prospect in the short term or long term of California getting a decent government. Consequently, whether it is part of the U.S. or Canada, its economy will decline steadily, its best people will leave (cheap air travel has reduced the attractions of living near even the nicest climate and beaches) and its politics will provide a sharp leftward tug, aided by voter fraud, on whichever country it belongs to.

Conversely, Alberta and to a lesser extent British Columbia have good property rights and generally vote in opposition to the leftists in Ottawa. Alberta has major energy resources, which will be even more valuable if they are not subjected to Canada’s lunatic environmentalists. British Columbia has bountiful resources of many kinds, whose utilization will be eased by leaving Canada’s excessively urban-leftist colonial-guilt First Nations policy, which has immobilized numerous resource pools at the hands of First Nation activists and their overstuffed lawyers.

Removing California from the United States would greatly improve U.S. governance. Based on the November 3, 2026, midterm election results, the Democrats would lose 49 Congressional seats and the Republicans 3 from such a change. This would give Republicans a solid if modest post-election majority in Congress, even after last week’s rout, although it would not rectify the post-election Senate imbalance since California has only two Senators. Adding Alberta and British Columbia to the American polity would further improve its political stability. British Columbia would presumably be close to neutral in American politics (with Vancouver a nest of elitist corruption and incompetence, like large U.S. cities) but Alberta is both solidly run and resource-oriented, so it would further restrict the excessive power of wealth-destroying environmental lobbyists and add more protection to a solidly conservative U.S. polity.

The other huge advantage in adding British Columbia/Alberta and subtracting California, would be that it would finally enable the United States to open up Alaska properly. Instead of being entirely separated from the mainland U.S., Alaska would have a deep and populated connection with the rest of the country through the western coast of British Columbia, along which trade and investment could be expected to agglomerate. The modest if evocatively named Prince Rupert, currently a fishing port of some 12,000 inhabitants, would become the megalopolis nexus of a vast industrial, mining and oil extraction economic powerhouse stretching from Vancouver through to the Bering Strait. With the additional more temperate coastline available, the B.C./Alaska combine would become far more attractive for both industry and immigrants, with massive natural resources and endless reserves of convenient and cheap hydroelectric power.

For Alberta, the ability to ship energy products directly into the U.S. market and the relative freedom from burdensome regulations would boost that sector, while Calgary and Edmonton would become business and entertainment centers for a larger area that stretched below the U.S. border. Entrepreneurial Albertans would probably be the principal beneficiaries of the United States’ lower taxes and lighter regulation.

For California, most inhabitants would welcome the clammy cocoon of Canadian socialism, and the extension of Canadian healthcare would fit especially well with most Californians’ wishes. The downside would be that ultra-rich resorts such as Malibu would find their American inhabitants mostly choosing to move away and being replaced by worthwhile Canadian surfers, many of them backpackers, who were nonetheless much poorer and less free-spending than those they replaced. California would also find that its tech sector, already drained by inter-state emigration, would have much more difficulty in innovation if it was no longer getting the best and brightest from non-Californian U.S. universities, but having to rely on the much smaller flow of top graduates from Canadian colleges. Still, most Californians would probably feel that the switch was worth it; into each even Californian life a little rain must fall!

Overall, the deal makes a huge amount of sense for the United States. 39 million people would be a loss, but their leftist politics makes their greater wealth a rapidly diminishing asset, while the deleterious effect California has had on U.S. environmental and safety regulations would not at all be missed. Conversely, the resources of Alberta and British Columbia, and 11 million new people eager to build a brighter future without excessive regulation would ensure that those provinces rapidly increased in wealth and population, making them huge assets to a remodeled United States. And the land bridge between Seattle/Vancouver and Alaska would become an extraordinary pole of economic growth.

You really can pay too much for good beaches!

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(The Bear’s Lair is a weekly column that is intended to appear each Monday, an appropriately gloomy day of the week. Its rationale is that the proportion of “sell” recommendations put out by Wall Street houses remains far below that of “buy” recommendations. Accordingly, investors have an excess of positive information and very little negative information. The column thus takes the ursine view of life and the market, in the hope that it may be usefully different from what investors see elsewhere.)