The federal and Ontario governments have been accused of treating taxpayers like "mushrooms"—kept in the dark and covered in manure—regarding a massive half-billion-dollar loan guarantee to Algoma Steel, issued with full knowledge of impending major layoffs.
Loan Announcement Omitted Key Layoff Details
In September 2025, Prime Minister Mark Carney's federal government and Premier Doug Ford's Ontario government jointly announced $500 million in loan guarantees to support Algoma Steel. The federal portion was $400 million, with the province contributing $100 million. The public announcements framed the financial support as crucial for the company and, by extension, for preserving jobs in Sault Ste. Marie.
However, it was only last week, when Algoma announced it was laying off 1,000 workers, that a critical fact emerged: both levels of government were fully aware these layoffs were planned at the time they approved the loans. This information was conspicuously absent from the initial funding announcements.
The "Green Steel" Transition and Accelerated Timeline
The layoffs are tied to Algoma's transition from traditional blast furnace operations to electric arc furnace technology. This shift is intended to produce lower-emission "green steel" but requires significantly fewer workers to operate. The company stated that the original plan was for these job cuts to occur sometime in 2027.
The timeline was dramatically accelerated, however, due to external economic pressure. Algoma cited the 50% tariff on Canadian steel imposed by U.S. President Donald Trump as the reason for moving the layoffs forward, making them effective in March of the coming year.
A Failure of Transparency and Public Accountability
Both the Carney and Ford governments have defended their actions, arguing that without their financial support, the layoffs announced would have been "much worse." Yet, editorial criticism focuses not on the economic rationale but on the deliberate lack of transparency with the public.
"The issue is why wasn’t this information given to the public at the time the loans were made?" the editorial posits. The answer, it suggests, is obvious: to avoid public questioning and criticism when the loans were initially celebrated.
This incident raises profound concerns about the billions of dollars in government support being directed to companies impacted by international tariffs. The Algoma case demonstrates that such aid does not come with ironclad job guarantees, despite rhetoric often emphasizing job preservation when programs are launched.
The fundamental question now posed to policymakers is: What else haven’t they told the public? The episode underscores a troubling pattern where the financial interests of corporations are prioritized ahead of the right of taxpayers—who ultimately foot the bill—to be fully and honestly informed.
