{"id":1278,"date":"2017-11-03T14:47:53","date_gmt":"2017-11-03T14:47:53","guid":{"rendered":"http:\/\/www.formac.ca\/starrspoint\/?p=1278"},"modified":"2017-11-03T14:47:53","modified_gmt":"2017-11-03T14:47:53","slug":"should-the-rest-of-canada-feel-sorry-for-alberta-lets-wait-and-see","status":"publish","type":"post","link":"https:\/\/www.formac.ca\/starrspoint\/2017\/11\/03\/should-the-rest-of-canada-feel-sorry-for-alberta-lets-wait-and-see\/","title":{"rendered":"Should the rest of Canada feel sorry for Alberta? Let’s wait and see"},"content":{"rendered":"

Globe and Mail<\/em> columnist Gary Mason has a timely piece in Wednesday\u2019s edition. Headlined \u201cNo one should feel sorry for Alberta<\/a>\u201d his commentary serves as a preemptive sortie again the emergence of Jason Kenney as the new leader of the United (in rage) Conservative Party of Alberta.<\/p>\n

As Mason sees it, Kenney rose to power with a narrative formed by the notion that \u201cthe province is a shell of its former self: the NDP has ruined everything: the rest of the country is against us but we won\u2019t be on our knees much longer. Mr. Kenney will Make Alberta Great Again.\u201d<\/p>\n

Mason argues that many provinces \u2013 just many? \u2013 wouldn\u2019t mind having Alberta\u2019s \u201cso-called problems\u201d such as \u201cthe highest GDP per capita in the land\u201d and growth exemplified by Calgary\u2019s rate of 4.6%. He could have cited even more examples to strengthen his case \u2013 for example, provincial growth expected to be the highest in the country this year and next.<\/p>\n

But his key point is about taxes. Mason frets unnecessarily about Alberta\u2019s growing deficit and debt but points out that if Alberta raised its taxes to the same level as neighboring British Columbia \u2013 with the second lowest taxes in the country – it could bring in almost enough revenue to eliminate this year\u2019s expected deficit.<\/p>\n

The concern about Alberta\u2019s deficit – or as Mason would have it \u201cthe mess the province is in\u201d – is based more on ideology than fiscal reality. The province\u2019s debt-to-GDP ratio is estimated at 6.8% this year. RBC’s<\/a> most recent Canadian Federal and Provincial Fiscal Tables <\/em>project that even after two more years of sizeable deficits Alberta will have a ratio of only 11.4%, still easily the lowest in the country and about one-third of the 34.1% projected for Nova Scotia in 2019.<\/p>\n

Mason paints with an overly broad brush when he suggests that rather than raise taxes or rein in spending \u201cpoliticians and others here moan and whine about how horrible things are, how awful the province is being treated by Ottawa and other jurisdictions.\u201d So far, the moaning and whining is coming mostly from Jason Kenney and his crowd, not from the NDP government.<\/p>\n

In its first budget, the Notley government increased the corporate tax from 10% to 12% and replaced the 10% flat tax on personal income with a bracketed system that raised the rate to 15% for those making $300,000 or more. (Nova Scotia\u2019s top rate is 21% and kicks in at $150,000). The NDP also bravely introduced a carbon tax of $20 a tonne, rising to $30 next year.<\/p>\n

Despite these increases, the NDP government\u2019s most recent budget was still able to boast about Alberta\u2019s overall tax advantage compared to other provinces, with no sales tax, no health premium and no payroll tax. \u201cEven when the carbon price rises to $30\u00a0a\u00a0tonne in 2018, Albertans and Alberta businesses will still pay at least $8.7 billion less in total taxes and carbon charges than if Alberta had the same tax system and carbon charges as any other province,\u201d according to the 2017 budget.<\/p>\n

But does this revisionist view of the province\u2019s economic situation mean \u201cNo one should feel sorry for Alberta\u201d? Not necessarily.<\/p>\n

Reminding about the province\u2019s good fortune relative to others has had no discernable impact on the complainers and bellyachers. The carbon tax in particular has people seeing red even though the impact of the levy on most Albertans is benign. At worst the tax may cost an affluent fuel-inefficient family of four about $40 a month, but will be fully rebated to the majority of households.<\/p>\n

The perceived negative effect on Alberta of the federal equalization program is also hard to fathom. Alberta does not receive equalization \u2013 as the richest province in the country it doesn\u2019t need it. In general, Alberta does pay more in federal taxation than it gets back in federal programs \u2013 again, a consequence of its wealth. And of course, that has changed to Alberta\u2019s advantage in recent years with the on-going per-capita health transfers and short-term disaster relief. And Jason Kenny\u2019s big idea – removing resource revenues from the equalization formula -would provide negligible benefit to Alberta, while surely helping out Newfoundland and Labrador.<\/p>\n

The fact that equalization and the carbon tax remain such sources of anger suggests they are proxies for underlying anxiety about Alberta\u2019s ability to keep the good times rolling in a world in which fossil fuel consumption must decline. Railing against the carbon tax, equalization and pipeline opponents in other provinces are interconnected responses to that fear of falling now that a major source of the province\u2019s wealth is in jeopardy.<\/p>\n

Never mind that several generations of political leadership \u2013 federal and provincial \u2013 should have seen this coming and planned for it. Any prospect of such forward thinking evaporated a long time ago. Put simply, the Mulroney government handed over the formulation of national energy policy to the oil industry, and Alberta decided to dip into its heritage fund to avoid a sales tax.<\/p>\n

Now that Donald Trump has demonstrated again the potency of know nothing populism we will likely see a continuation of the sort of provocative stuff Kenney spouted during his leadership campaign.<\/p>\n

Trump has his Mexican wall and his Muslim ban; Kenney has his referendum on equalization and his campaign against national polices on carbon emissions.<\/p>\n

The difference is that Trump\u2019s cruel but nonsensical proposals may have sprung from ignorance. Kenney, a member of the federal cabinet for eight years, has no such excuse. He will know that a provincial referendum on a federal program is fraudulent. But he could well keep on about that, as well as challenging national polices on carbon emissions.<\/p>\n

Stoking people\u2019s anger at scapegoats and paper tigers is easier than talking about the real problems and their solutions. If Kenney and his United Conservative Party continue that approach and are successful we may indeed end up feeling sorry for Alberta \u2013 and the for the rest of the country.<\/p>\n

-30-<\/p>\n","protected":false},"excerpt":{"rendered":"

Globe and Mail columnist Gary Mason has a timely piece in Wednesday\u2019s edition. Headlined \u201cNo one should feel sorry for Alberta\u201d his commentary serves as a preemptive sortie again the emergence of Jason Kenney as the new leader of the United (in rage) Conservative Party of Alberta. As Mason sees it, Kenney rose to power […]<\/p>\n","protected":false},"author":1,"featured_media":1011,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[8],"tags":[107],"class_list":["post-1278","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-politics","tag-alberta","et-has-post-format-content","et_post_format-et-post-format-standard"],"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/posts\/1278","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/comments?post=1278"}],"version-history":[{"count":2,"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/posts\/1278\/revisions"}],"predecessor-version":[{"id":1280,"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/posts\/1278\/revisions\/1280"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/media\/1011"}],"wp:attachment":[{"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/media?parent=1278"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/categories?post=1278"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.formac.ca\/starrspoint\/wp-json\/wp\/v2\/tags?post=1278"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}