# Alberta Budget



## bgc_fan (Apr 5, 2009)

There has been a lot of rhetoric regarding Alberta's finances over the past few months now that they are going to post a sizeable deficit. Of course, most in Alberta will keep pointing to equalization payments as being a main driver for not being able to build a sizeable heritage fund, while others outside of Alberta will point to the fact that they don't spend within their means, i.e. base on tax revenue instead of counting on oil revenues.

So, I saw this Maclean's article about Alberta's situation and found it interesting as it confirmed some of the suspicions that I had regarding equalization, provincial revenues, and provincial spending. Basically it sets up three courses of action: increase revenue, decrease spending, or maintain spending and allow revenue growth to make up the shortfall.

I find a few interesting takeaways:

1. You may not agree with equalization, but the idea is that payments are based on the provinces capacity to raise revenues. When you look at the first table showing the Alberta tax advantage and what would happen if they were to implement other provinces' taxation policies, you could increase revenue by $8.9B (following BC), up until $20.9B (following Quebec). If you've lived in Quebec, you'll know that things are being taxed to the hilt and I'd say that they have maxed their capacity to generate revenue (although maybe they could charge higher hydro rates, but that would essentially 'tax' residents).

2. Per captial program spending is the highest in Alberta (little over $10k), whereas the 'socialist' province of Quebec, with all its social programs spends a shade less than $8K per capita. Ontario falls in around $8.5k. There's another article that compares all the provinces' spending and point out that the high cost is due to higher labour costs due to the oil workers, i.e. need to compete with the high paying oilpatch jobs.

3. For all the concerns about health care spending, Alberta does spend the most. 

So, from what I read is that Alberta spends the most, but doesn't want to impose new, or raise tax rates. Instead, since there is no appetite to cut spending, Alberta will just go into deficit. I'm not really sure if I should have any real sympathy for this situation.


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## Just a Guy (Mar 27, 2012)

I'm not sure I understand your first paragraph...without equalization payments Alberta, from what I understand, would spend within their means while other provinces take the equalization payments and still run deficits, so are obviously spending well beyond their means...

To me, all governments spend money they don't have, that's how they get elected. I doubt a party would stand a chance of seeing many votes if they were fiscally responsible. Most people seem to think government money is "free money", not understanding where the money has to ultimately come from. Everyone complains about taxes, yet wants more government money and services. Many say tax companies, yet complain when prices go up for goods and services...

Until the common person wakes up to reality, no one has a right to complain. We got the governments we deserve and all the problems that come with it. This is what you get from uneducated democracy.


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## Mukhang pera (Feb 26, 2016)

Just a Guy said:


> To me, all governments spend money they don't have, that's how they get elected. I doubt a party would stand a chance of seeing many votes if they were fiscally responsible. Most people seem to think government money is "free money", not understanding where the money has to ultimately come from. Everyone complains about taxes, yet wants more government money and services. Many say tax companies, yet complain when prices go up for goods and services...
> 
> Until the common person wakes up to reality, no one has a right to complain. We got the governments we deserve and all the problems that come with it. This is what you get from uneducated democracy.


Hear, hear.


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## AltaRed (Jun 8, 2009)

Equalization payments are on a 3 year forumula, so AB and SK suffered in 2015 and will suffer in 2016 as well, but the rolling average is correcting itself. IOW, slow to come down but also slow to rise when AB and SK fortunes turn around (if they do).

I did not read the Maclean's article but one consideration that has to be taken into account when looking at capital spending per capita is that high population growth (percentagewise) burdens existing taxpayers until infrastructure can catch up. Provinces that lose population or are static like Quebec mostly only have to repair and maintain rather than build incremental infrastructure. That is a larger burden than most realize. That said, AB has been known for inefficient capital spending with starts and stops. I saw it with my own eyes for the many years I lived there. There has also been a refusal to 'toll' certain infrastructure like the twinning of the Fort Mac highway or even some parts of the Edmonton and Calgary ring roads.

One thing we do know is union work forces are either the best paid, or close to being best paid in Canada. There is something wrong with that picture.

What AB really needs is a VAT but the resistance borders on civil disobediance, not just hostility. I can understand long time Albertans being resistant but so many of Albertans today are relative newcomers and have lived with it under other provincial regimes. Until AB can grasp that and institute a VAT, the province will continue to flail around like a beached mackerel. You can't help those who are unwilling to accept reality.


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## Just a Guy (Mar 27, 2012)

Which of the provinces with a VAT are you holding up as the "example to live by"? Give a government more money, they'll just spend it. They don't become fiscally responsible, they become Greece. 

Of all the provinces, even with all the ups and downs, isn't Alberta the best off as far as debt and deficits? Aren't they one of the few "have" provinces, aren't they the only province to always be a "have" province?

Counter that to Quebec who has taken thousands in transfer payments, special grants, etc. And never made a contribution financially to the rest of Canada...rather they choose to hold up their province for ransom. 

Now, I don't for one minute believe Alberta is the model we should follow, but compared to the other provinces I don't think we can slam them either.


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## AltaRed (Jun 8, 2009)

If AB had a VAT, they could (and should) put a lot more resource revenue into the trust fund. Whether they would or not would remain a question but that is what Norway does. The problem now is tax revenue is so unpredictable that it causes havoc with fits and starts and stops of so many things, they cannot help but be inefficient. Some years are flush with surpluses while other years are dearth of revenue. How ridiculous is that?

There simply no leadership at the gov't level, nor has there been for some time. AB has had a lot of dorks in the premier's chair. The last good one was Klein who had to curb the free spending ways of his predecessors.


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## Just a Guy (Mar 27, 2012)

Despite their surpluses, they never saved, every surplus probably resulted in people lined up with their hands out, that's how they got the highest paid teachers, doctors, union workers, etc....just seems to prove my point, give them more money they'll just spend it. It's what they are elected to do.


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## sags (May 15, 2010)

Cut or raise taxes...........or maybe grab some of that $8 Billion revenue the government is losing to tax avoidance schemes and loopholes annually ?


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## Just a Guy (Mar 27, 2012)

8 whole billion??? What is that, a day's interest on the federal debt? Add in all the provincial debt and 8B is probably a rounding error...like trying to stop a river with a packet of gum.


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## andrewf (Mar 1, 2010)

$8 billion is more like 3-4 months of interest on the federal debt. It's also about 0.6% of total government debt both federally and provincially.


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## andrewf (Mar 1, 2010)

Just a Guy said:


> Which of the provinces with a VAT are you holding up as the "example to live by"? Give a government more money, they'll just spend it. They don't become fiscally responsible, they become Greece.
> 
> Of all the provinces, even with all the ups and downs, isn't Alberta the best off as far as debt and deficits? Aren't they one of the few "have" provinces, aren't they the only province to always be a "have" province?
> 
> ...


Alberta wasn't always a 'have' province. Prior to developing its oil wealth, it was a perennial recipient of federal transfers.


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## Just a Guy (Mar 27, 2012)

https://www.fraserinstitute.org/blogs/primer-equalization-canada

My god, your right...had to go back to 1957 to find it, but the west actually did get money...but I don't see any "perennial" recipients other than Quebec, PEI, Nova Scotia, New Brunswick, and Manitoba...unless you mean payer like Alberta and BC since the 60's.

Looks like the west even paid during the NEP years which, from what I hear, pretty much ruined the economies out there to the benefit of the east, unless I misread those charts.


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## Plugging Along (Jan 3, 2011)

bgc_fan said:


> There has been a lot of rhetoric regarding Alberta's finances over the past few months now that they are going to post a sizeable deficit. Of course, most in Alberta will keep pointing to equalization payments as being a main driver for not being able to build a sizeable heritage fund, while others outside of Alberta will point to the fact that they don't spend within their means, i.e. base on tax revenue instead of counting on oil revenues.
> 
> So, I saw this Maclean's article about Alberta's situation and found it interesting as it confirmed some of the suspicions that I had regarding equalization, provincial revenues, and provincial spending. Basically it sets up three courses of action: increase revenue, decrease spending, or maintain spending and allow revenue growth to make up the shortfall.
> 
> ...


I quickly read the article, and it talks a little bit on how the payments are calculated. Granted the incomes of those still working are higher in Alberta therefore they have the capability to pay as individuals. HOWEVER, the fact remains that if there were NO equalization payments at all, let's say like Norway, whom also would have to pay under the formula, that would wipe out the deficit. 

one could argue that Alberta actually does spend what they being in, however are force to give away a large chunk. If every province was force to spend only what they earned, with no equalization payments, then it would be inserting to see how much they would actually have.


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## Plugging Along (Jan 3, 2011)

andrewf said:


> Alberta wasn't always a 'have' province. Prior to developing its oil wealth, it was a perennial recipient of federal transfers.


Well, since the formal equalizational program was introduced in 1957 hence the graph by JAG above starts there, it shows that the West has always been a contributor since the beginning of this program. Even prior, Alberta was a contributor, but let's say they only started contributing when the progra, started and from the year prior they were a receiver. What that tells me is at a max Alberta may have received for 52 years, which I am suspect of, when the province was first forming. For the more recent history of 59 years they have been a contributor, and yes that was during the NEC and it seems to be continuing for no end, though albertans are currently hurting.

If one took the net amounts of what was received and contributed, it Alberta has contributed billions more. I was reading a really interesting article, but I cannot find it. It was a comparison on what alberta and Norway did with their rolyalties and oil. Definitely some mistakes Alberta did, but two very interesting factors where the impact on the equalization payments, and the NEC and what happened out east. 

If anyone finds it, please post.


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## bgc_fan (Apr 5, 2009)

Just a Guy said:


> I'm not sure I understand your first paragraph...without equalization payments Alberta, from what I understand, would spend within their means while other provinces take the equalization payments and still run deficits, so are obviously spending well beyond their means...





Plugging Along said:


> I quickly read the article, and it talks a little bit on how the payments are calculated. Granted the incomes of those still working are higher in Alberta therefore they have the capability to pay as individuals. HOWEVER, the fact remains that if there were NO equalization payments at all, let's say like Norway, whom also would have to pay under the formula, that would wipe out the deficit.
> 
> one could argue that Alberta actually does spend what they being in, however are force to give away a large chunk. If every province was force to spend only what they earned, with no equalization payments, then it would be inserting to see how much they would actually have.


This is a complete misconception of how the equalization system works. 

The funds are drawn from the federal revenues and not some sort of extra payment paid by the provinces, i.e. federal taxes and GST and other federal revenues contribute to the funds that are used for equalization. 

Yes, Albertans use the excuse that it is because of equalization that they don't have a wealth fund of $1T like Norway does and has a heritage fund of $18B. So lets actually look at what if the federal government didn't have the equalization program and instead just gives the equivalent as a top up in federal transfers (i.e. per capita).

So from the Federal finance site, we get a total of $17,880M for 2016/2017. From Wikipedia, we get a 2014 population estimate of 35,675,834, so per capita distribution would be $501.

So, what would the net result be? Instead of Alberta receiving nothing, it would receive $2B. The other winners? BC with $2.3B an Ontario with $4.6B (even taking into account the equalization payment it will receive). The biggest loser of course is Quebec with a reduction of $5.9B. Feel free to check it out for other years, but I suspect that it would be about the same, depending on the population and equalization program size.

Assuming that were constant throughout the lifetime of the Alberta heritage fund (40 years), we are talking about $80B. Someone can do the calculation of what those extra contributions would add up to, but doubt it would be he difference of $1T.

If you don't agree with what I've said, go ahead and provide some other metric, but I figure this is actually the easiest to determine.


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## Just a Guy (Mar 27, 2012)

Here is an interesting, if true (just because it's on the Internet doesn't make it so of course) article which may change my thinking on this subject.

http://thoughtundermined.com/2012/04/24/equalization-misconceptions/

Of course, saying it's "federal money" doesn't really change the fact that albertans are being taxed more by the Feds to allow other provinces to benefit. Ultimately there is only one tax payer, governments don't produce money, they take and redistribute...well they take, borrow and redistribute I guess.


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## bgc_fan (Apr 5, 2009)

Just a Guy said:


> Here is an interesting, if true (just because it's on the Internet doesn't make it so of course) article which may change my thinking on this subject.
> 
> http://thoughtundermined.com/2012/04/24/equalization-misconceptions/
> 
> Of course, saying it's "federal money" doesn't really change the fact that albertans are being taxed more by the Feds to allow other provinces to benefit. Ultimately there is only one tax payer, governments don't produce money, they take and redistribute...well they take, borrow and redistribute I guess.


I saw that... as he pointed out it is one of the first articles that pop up when you do a Google search. The only problem I have is how he characterizes federal spending in a province because it is quite difficult, i.e. accounting for military bases, federal government workers, etc.

Hold on about the Albertans being taxed more by the Feds. There is no special Albertan tax. Unless there is something I am missing, even natural resources like oil and minerals only go to the provincial government, not federal. The only revenue that Federal government would be getting through taxes would be the GST and federal income tax which is common throughout Canada. If you mean the federal government collects more taxes based on those things than other provinces, then I would point out that based on population size alone, Quebec and Ontario would be larger revenue streams for Canada.


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## Just a Guy (Mar 27, 2012)

No, I assume that the albertans pay federal income taxes (into general revenues) and, instead of that money going to Alberta (in proportion to the amount collected) funded federal projects, less of the money goes to Alberta and more to the "have not" provinces. 

So, while there is technically no "special tax", albertans (or more accurately the west) is funding the east. The money is coming from them and not going back to them. Typical wealth redistribution by government. 

From what I understand, the Alberta "carbon tax" to reduce emissions is also more about wealth redistribution with 60% of what is collected going to lower income families to offset higher prices (doesn't that go back to the producers as profits since they raised their prices?), while 40% is allocated for other things like technology to reduce the effects (to be given back to the producers to develop?), but only a portion of that 40%. There aren't many details out there, so I may be wrong, but I can see why the producers are backing it.


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## sags (May 15, 2010)

Don't transfer payments pay the cost of federally mandated programs and services ?

When the Federal government changes criminal laws, it often adds an additional cost to the Provinces to implement, and the cost is greater for more populated Provinces.

When the Federal government legislates changes to some programs and services for low income folks, an extra burden is placed upon Provincial social services.

Lobby groups like the Fraser Institute produce reports that are biased to affect change that coincides with their ideology, just as left wing groups like the Broadbent Institute also do.

I take all these reports with a grain of salt.

The terminology of "have" and "have not" Provinces doesn't represent a true and accurate account of the transfer payment system.

Ontario...........despite it's taxpayers and consumers sending much more revenue to Ottawa than it receives back, is a "have not" Province ?

Alberta is echoing the same complaint that Ontario has been claiming for years. Basically, they want more of their revenues collected by the Federal government returned to them.

The easiest way to balance your own level of government budget is to download services onto a lower level of government, but send less money than required...........voila............extra money for your budget.


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## AltaRed (Jun 8, 2009)

Just a Guy said:


> Of course, saying it's "federal money" doesn't really change the fact that albertans are being taxed more by the Feds to allow other provinces to benefit. Ultimately there is only one tax payer, governments don't produce money, they take and redistribute...well they take, borrow and redistribute I guess.


JAG has it nailed. The equalization payments come from a net drain of tax revenues that come out of AB but do not return. That is simply how it works at the macro level. The 64 million dollar question though is IF AB was to have kept all those equalizatino payments, would they have pissed it away? Or would they actually have put it in their trust fund aka Norway? Gotta remember Norway is a sovereign nation while AB is not.


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## bgc_fan (Apr 5, 2009)

AltaRed said:


> JAG has it nailed. The equalization payments come from a net drain of tax revenues that come out of AB but do not return. That is simply how it works at the macro level. The 64 million dollar question though is IF AB was to have kept all those equalizatino payments, would they have pissed it away? Or would they actually have put it in their trust fund aka Norway? Gotta remember Norway is a sovereign nation while AB is not.


I tell you what, here is some old information from 1981-2009 which shows the net drain from Alberta. Cumulatively it is $165.8B which is still a far cry from $1T. Again, you can run some sort of model to figure out what it would be worth if that amount was invested somewhere. For comparison sake, for Ontario it is a net drain of $295.5B over that same period of time. No surprise for Quebec that it was a gain of $232.3B.

So, yes, using equalization as the crutch or the excuse for why Alberta doesn't have a huge heritage fund is getting old. Saying that Norway is a sovereign nation is also another bad excuse. The reasons why Norway was able to build such a large fund was because they have high taxes along with their social programs and impose a high royalty payment on the oil. But, there was never an appetite in Alberta to do either of those. It's convenient to say that all the money is being diverted to the East, but then you overlook some of the decisions that were made. Jim Prentice was speaking the truth when he pointed out that all Albertans have to do is look in the mirror to explain the economic problems: a zero tolerance for tax hikes, and a zero tolerance for service cuts.


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## AltaRed (Jun 8, 2009)

bgc_fan said:


> So, yes, using equalization as the crutch or the excuse for why Alberta doesn't have a huge heritage fund is getting old. Saying that Norway is a sovereign nation is also another bad excuse. The reasons why Norway was able to build such a large fund was because they have high taxes along with their social programs and impose a high royalty payment on the oil. But, there was never an appetite in Alberta to do either of those. It's convenient to say that all the money is being diverted to the East, but then you overlook some of the decisions that were made. Jim Prentice was speaking the truth when he pointed out that all Albertans have to do is look in the mirror to explain the economic problems: a zero tolerance for tax hikes, and a zero tolerance for service cuts.


I will disagree with you that Norway being a sovereign nation and AB is NOT a significant difference. AB has to remain competitive to keep business there vs SK vs BC vs rest of the world. The comparison on royalties is bogus because royalites can only be as high as the productive basin will allow them to be. Norway has higher royalties because its O&G fields are more economic. I know because I ran project economics on projects worldwide with the multi-national I worked for. IOW, people pointing out royalty differences are coming from a total lack of knowledge on relative economics of sedimentary basins. The last time AB jacked up royalties was from Stupid Stelmach and business fled. Rigs left the province in the hundreds...off to SK and BC and lined up at Sweetgrass trying to cross the border. A lesson learned. The Western Canada Sedimentary Basin has poor economics relative to most global locations, onshore USA excepted.....and in recent years, shale oil excepted. Royalties are as high as they can be to keep capital from fleeing.

That said, I agree with you that AB needs higher taxes, including a VAT (remember I said that upthread?) and I agree that Prentice was right on the two issues you pointed out. His mistake was thinking the average AB voter was mature enoug to understand and accept. It obviously was not. AB is its own worst enemy in many ways.

Added: FWIW, just in case you think otherwise, I have no parochial fondness for AB. Other than being born and raised there, I've lived and worked in a number of provinces as well as several ex-pat assignments. I now live in BC for a number of reasons.


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## bgc_fan (Apr 5, 2009)

AltaRed said:


> I will disagree with you that Norway being a sovereign nation and AB is NOT a significant difference. AB has to remain competitive to keep business there vs SK vs BC vs rest of the world. The comparison on royalties is bogus because royalites can only be as high as the productive basin will allow them to be. Norway has higher royalties because its O&G fields are more economic. I know because I ran project economics on projects worldwide with the multi-national I worked for. IOW, people pointing out royalty differences are coming from a total lack of knowledge on relative economics of sedimentary basins. The last time AB jacked up royalties was from Stupid Stelmach and business fled. Rigs left the province in the hundreds...off to SK and BC and lined up at Sweetgrass trying to cross the border. A lesson learned. The Western Canada Sedimentary Basin has poor economics relative to most global locations, onshore USA excepted.....and in recent years, shale oil excepted. Royalties are as high as they can be to keep capital from fleeing.


My point about royalties is that Norway has leveraged their high royalties to fund their sovereign fund. You point out that Alberta can't sustain those high royalties, that's fine. But don't go and say that the only reason why the Heritage Fund is so low because of the equalization program. 

I suspect we'll just disagree on the significance of Norway's advantage of being a sovereign nation because there are other aspects that it entails, i.e. shouldering all sort of "national" costs like military, maintaining embassies, etc.


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## andrewf (Mar 1, 2010)

For all the moaning, its almost as if Albertans don't realize that Ontario has contributed far more in net tax revenue than Alberta has. And all that despite not having nearly the resource wealth. I know people in Alberta get offended when people say you just have the pump or dig up the wealth (and yes there is labour involved), but it is true that the same activities in Ontario for the most part will yield only dirt and rock, and not hundreds of billions of dollars of petroleum. So, Alberta's success is more an accident of geology than moral superiority. Alberta has low taxes because they have the luxury of abundant resource wealth. They spend more than Quebec or Ontario's supposedly wasteful governments on public services.


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## AltaRed (Jun 8, 2009)

Yabbut, just remember ON has about 4-5 times the population. AB has contributed far more on a per capita basis. Just means one has to keep that in context.


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## olivaw (Nov 21, 2010)

AltaRed said:


> That said, I agree with you that AB needs higher taxes, including a VAT (remember I said that upthread?) and I agree that Prentice was right on the two issues you pointed out. His mistake was thinking the average AB voter was mature enoug to understand and accept. It obviously was not. AB is its own worst enemy in many ways.


Prentice may have been right about our fiscal problems but he went about it all wrong. He told us to look in the mirror but refused to acknowledge that the Progressive Conservative party was at the helm while our fiscal mess developed. He promised to cut services and impose taxes and fees on individuals. He refused to raise our low corporate tax rate or re-introduce progressive taxation. His personal character was demonstrated when he resigned as an MLA before the votes were even counted. 

The Macleans article offered some hope. If the Alberta government can stem cost increases then a 12% corporate rate, progressive taxation, and economic growth should allow us to balance the budget eventually. I don't necessarily oppose a small sales tax (VAT, PST, HST) but it would be so politically unpopular in Alberta that no party would propose it. 

Sadly, we lack a viable moderate party now. The PCs may be done and Alberta Liberals gets less respect than a garden slug. (Don't ask me how I know this. :hopelessness


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## AltaRed (Jun 8, 2009)

You have a pretty good snapshot of the situation...at least I agree. He did go about it badly...making the mistake that business (corporations) had to participate in the pain (tax increases) and that the fat cats in the executive suites could pay more. 

I am surprised Notley reversed some of the user fee increases (campaign promise?) and she will have to raise some of them anyway. Putting in a price based land transfer tax is low hanging fruit that I believe every other province has, and a progressive probate fee that I believe most provinces already have.

Long ago at the time of the Reford leadership run, I told the PCs they needed to get innovative in some of their programs, like road and bridge tolls in selective areas but you'd thought I was a ghost come to haunt them. Time will tell.

P.S. Perhaps the PC's and Liberals will form a 'center' party. They both need to re-invent themselves or die on the vine. The WRA is almost a shoo-in in the next election absent a viable alternative to the Nasty Demolition Party.


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## twa2w (Mar 5, 2016)

andrewf said:


> For all the moaning, its almost as if Albertans don't realize that Ontario has contributed far more in net tax revenue than Alberta has. And all that despite not having nearly the resource wealth. I know people in Alberta get offended when people say you just have the pump or dig up the wealth (and yes there is labour involved), but it is true that the same activities in Ontario for the most part will yield only dirt and rock, and not hundreds of billions of dollars of petroleum. So, Alberta's success is more an accident of geology than moral superiority. Alberta has low taxes because they have the luxury of abundant resource wealth. They spend more than Quebec or Ontario's supposedly wasteful governments on public services.


Not sure how you get that Ontario doesn't have much natural resouces. While they do may not have a lot of oil and gas, the bulk of natural resource development in Canada over the years has been done in Ontario. Gold, silver, iron ore, salt, copper, nickel ( maybe almost depleted, now), water. Forestry uranium diamonds Etc etc as well as some of the first petroleum reserves developed in Canada.
Just saying.


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## Eder (Feb 16, 2011)

OK...I enjoy different views on our budget here but I want to say 2 things

1. Albertan's were idiots...they won't be in 3 years
2. If I hear another Norway reference I will puke...we are not nor intend to be a socialist country. It's like comparing Ontario to Greece..

OK, continue tearing us up , we will continue paying for confederation ... that is all.


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## fraser (May 15, 2010)

I am not, in general, a fan of the NDP. Most especially at the federal level and most especially with Mulcair.

But, as an Albertan I have to say that I am pleased with Notley so far. Alberta desperately needed a change. Now, when I look at Ric McIvor's or Brian Jean's performance I am even more satisfied with Notley.

One question that still nags at me is why on earth did the Conservative a Party in Alberta select Ric McIvor as their interim leader. The choice demonstrates how shallow the talent/brain pool really is in that party at the moment.


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## AltaRed (Jun 8, 2009)

Hence why the PCs in AB are finished (in my not so humble opinion). I think they and the Libs will have to get together like the Sask party in SK did...with fresh faces and a new platform.


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## olivaw (Nov 21, 2010)

I agree with AltaRed's prediction. If there is no viable moderate alternative, we are probably going to end up with a Wildrose government. Unite the centre doesn't have the same ring to it as unite the right but it is probably what Alberta needs.


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## zylon (Oct 27, 2010)

*About six of these will need to roll into one, to stop the spread of the orange haze.*

*Parties represented in the Legislative Assembly*


Alberta Party (since 1985, represented 2010-2012, 2015)
 Alberta Liberal Party (founded 1905, government of Alberta 1905-1921; represented in the Legislature 1905-1944, 1948-1971, & since 1986)
 Alberta New Democratic Party (founded 1932 (as the CCF) (the CCF's predecessors: the United Farmers of Alberta was government 1921-1935, the Dominion Labour Party had five MLAs in the 1920s); the CCF represented in the Legislature 1944-1959, the ANDP 1966-1967, 1971-1993 & since 1997, current government of Alberta as of May 2015)
 Progressive Conservative Association of Alberta (founded 1905 (as the Conservative Party), represented in the Legislature 1905-1921, 1926-1940, 1952-1963, & since 1967, government of Alberta from 1971 - 2015)
 Wildrose Party (founded 2008, represented in the Legislature since 2008)

*Registered parties never represented in the Legislative Assembly*


 Communist Party – Alberta (since 1930)
 Green Party of Alberta (since 2011)
 Separation Party of Alberta (since 2004)
https://en.wikipedia.org/wiki/List_of_political_parties_in_Alberta


screencast


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## zylon (Oct 27, 2010)

FYI : *Danielle Smith* hosts a talk show 12:30 to 3pm (mountain time) weekdays.

A lot of her topics are girlie talk, but being a former politician she also covers that topic.

With the NDP goings-on in Edmonton this weekend, she will no doubt have that on her slate this week.

Radio "listen live" link: http://www.newstalk770.com/afternoons/

*ADDED:*

*Rachel Notley stands firm for pipelines at national NDP conference*
_'We’re not making a choice between the environment and the economy. We are building the economy.'_
http://www.cbc.ca/news/canada/edmonton/rachel-notley-ndp-conference-1.3528549
- includes half hour audio (bring your own barf bag)


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## olivaw (Nov 21, 2010)

zylon said:


> FYI : *Danielle Smith* hosts a talk show 12:30 to 3pm (mountain time) weekdays.
> 
> A lot of her topics are girlie talk, but being a former politician she also covers that topic.
> 
> ...


Thanks for the link to Notley's speech at the NDP convention. I have never voted NDP and probably never will, but I didn't find Notley's speech to be excessively barf inducing. I was actually pretty impressed that she urged this audience to move beyond the manifesto to practical policy initiatives. She even got a crowd at an federal NDP convention cheering pipelines. :-O

ETA: I guess the NDP voted to spend two years debating the Leap Manifesto. That's going to hurt Notley.


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## twa2w (Mar 5, 2016)

Given both T2 and Notley got in on the anti vote, I am much more impressed with Notley than I am Trudeau.
Notley could win a second term if the wild rose and the pc's merge. There is still a lot of pc animosity and if the wild rose let them merge, this may backfire on them as people may say thry are just a whitewash of the pc's. The best thing WR could do is to distance themselves from the PC and refuse a merge but be open to people joining them.
It is still a long time to the next election so who knows what we will see. Politiical memories are really short in some ways( and really long n others) 

Cheers
J


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## bgc_fan (Apr 5, 2009)

AltaRed said:


> Yabbut, just remember ON has about 4-5 times the population. AB has contributed far more on a per capita basis. Just means one has to keep that in context.


Per capita aside, it doesn't negate the fact that Ontario still contributed more (historically) than Alberta. I suspect that things may have changed by now, but I'm too lazy to look.

I think the thing that rubs me the wrong way is that we have 2 provinces facing economic problems (mind you Ontario is in a much bigger mess than Alberta), but the blame is placed differently.

For Ontario the top 3 reasons for the mismanagement of the economy are:
1. Liberal government
2. Liberal government
3. Liberal government
Which I find is a fair assessment of the situation. Liberal policies have hurt Ontario's economy to put it mildly.

On the other hand, for Alberta, the three seem to be:
1. Equalization program
2. Federal government (Liberal government that is)
3. Provincial NDP government
Rarely do I see any blame placed on the previous Conservative governments, either federal or provincial.

At any case, and at risk of hijacking my own thread, I was curious about the Energy East pipeline, as it is a related issue and you have expertise in the field. I think we all know the opposition view regarding pipeline safety, and stories like the recent Keystone leak in South Dakota don't help. But when it comes to the supporters, I see three main points; however, things don't seem too clear on the validity to me.
1. Using Alberta oil to supply Eastern Canada. On the face of it, I would say it makes sense and ensuring that the country is self-sufficient when it comes to oil is a no brainer. However, the problem I have is understanding how that is. There are refineries in Quebec and New Brunswick that handle Saudi crude, but to process dilbit requires upgrading or new refineries does it not? If these aren't in place, or aren't planned to be in place soon after the pipeline is constructed this arguments seems to fail to me, i.e. the dilbit gets to Quebec and New Brunswick, but then shipped off and Eastern Canada is still dependent on Saudi crude.
2. Opening up new markets. This is kind of related to the first one. If dilbit requires different refineries than traditional oil refineries, do they actually exist in markets that don't already process dilbit? My understanding is that China and the USA have these refineries, but I don't know who else.
3. Jobs. I get that you could have transitional jobs for construction/upgrade of facilities and shipyards for oil tankers, but as far as permanent jobs, all I can think of are pipeline maintainers/inspectors, and maybe more workers on the shipyards. When it comes to the refineries, it should be the same unless the refining process is more labour intensive.

I figure you might be able to enlighten us on the subject.


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## AltaRed (Jun 8, 2009)

By the way, I do blame multiple previous PC governments for at least some of the malaise. Ever since Ralph Klein (and he had some warts), it has been a fiasco with the likes of Stelmach, Redford et al. So I would add a 4. The last 15 years of so of PC governments.

About Energy East, I am not so versed on the details BUT there are some higher level themes/comments:

1. You are correct in that EC refineries cannot process significant quantities of dilbit/heavy crude today. They would have to add hydrocracking and/or coking to existing refineries to handle the heavier molecules 'efficiently'. Entirely possible that one Montreal refinery might do that for at least some of the crude but that will depend on Suncor and others responding. The Irvings would be the most practical to do so given the size of their refinery but I doubt it will happen because of their tidewater import sources. That will likelyl mean EC refiineries will continue to mostly import lighter crude. The key is to get to tidewater and that will open up markets. I believe Europe in particular would respond with some hydrocracking, if for no other reason than Brent and other light crudes are becoming more scarce AND they want to decrease their dependency on Russia. I think if Energy East came to pass, we would see some response from refineries across the pond and perhaps more importantly, enough confidence to actually build more upgrading in AB. If there is more certainly/confidence on a market for SCO, then more upgraders are a real possibility. All this will take years of course, and in the meantime, a lot of the dilbit would go by tanker from Saint John to the US Gulf Coast.

2. Per 1. above, Europe could very well respond with refinery configurations, or AB upgrading or both. The key is the confidence on market alternatives.

3. Refineries require quite a bit of operating labour given their sophistication, complication and moving parts. As you suggest, pipelines themselves do not require much in the way of O&M labour.


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## andrewf (Mar 1, 2010)

Does Energy East really make sense, though, or is it just a desperate response to opposition to Keystone and the pipelines to the BC coast?


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## AltaRed (Jun 8, 2009)

andrewf said:


> Does Energy East really make sense, though, or is it just a desperate response to opposition to Keystone and the pipelines to the BC coast?


On the surface, not a lot of sense....in the near term. In the short term, it does help TRP though with half empty gas pipelines, i.e. stranded assets, to Ontario. Those assets could be put to use shipping oil/dilbit/?  But (I think) producers (the shippers) no longer can count on any one proposal getting traction (given the failure of Keystone XL and most likely Gateway). They have to ride 2 horses in the hope....something happens. Bottom line is Canadian GDP will continue to take a hit until there is SOMETHING to tidewater. Longer term, I stick to my thought that IF our oil can get to Saint John, there will be markets that will want that oil. Too much oil currently comes from unstable and uncertain places.

The problem will be IF both pipelines (Energy East and Kinder Morgan) get approvals to build. There will ultimately be too much pipeline capacity. I suspect Kinder Morgan has the inside track as long as Vacouver city council can stick to their knitting and Christy Clark realizes her salivating over LNG is just a fantasy. She'll come around if all the LNG projecs falter.


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## fraser (May 15, 2010)

Many people in Alberta do not understand the issue that BC has with expanding the pipeline capacity.

We used to live in close proximity to the tank farm in Burnaby. For a start the expansion calls for the addition of several large storage tanks to the existing tank farm. These additional new tanks would be even closer to the elementary school than the current ones. Opposite a busy road and cross the street from a shopping centre and a high school. The City of Burnaby Fire Department has stated quite categorically that they do not have the equipment necessary to contain a fire should one occur. All this, plus the mess that happened a number of years ago when the pipeline burst in A North Burnaby residential area. Dome people were forced from their homes for months, a few were unable to return to their homes and had to be bought out.


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## bgc_fan (Apr 5, 2009)

Interesting. Thanks for the insight. I guess it is true that Europe would be interested in reducing their dependence on Russia and Middle East. I just never thought that there was much push to moving oil to Europe.


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## AltaRed (Jun 8, 2009)

bgc_fan said:


> Interesting. Thanks for the insight. I guess it is true that Europe would be interested in reducing their dependence on Russia and Middle East. I just never thought that there was much push to moving oil to Europe.


The desire, or lack of it, will most likely depend on Russian politics. With the likes of demagogues/bullies like Putin running the show (and his latest initiative with a national guard), Europe will be motivated to have more energy independence. Who knows how long this chapter will last, and whether it gets worse or better.


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## twa2w (Mar 5, 2016)

AltaRed, I know why energy east makes sense, re using existing lines etc but has anyone explored building a pipeline through northern Sask and Manitoba to a port on Hudson Bay. 
Iow population area so perhaps fewer objections other than maybe native groups who could likely be convinced with annual fees for crossing land and some jobs.
Hudson Bay now open to shipping year round but perhaps some ice Berg risk once out in Atlantic.
Thoughts


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## andrewf (Mar 1, 2010)

I have family that lives near North Bay, Ontario, and I hear there is a lot of skepticism about the safety of running dilbit through a pipeline originally designed for natural gas. Natural gas is a lot safer ecologically in the event of a leak. There have been some recent pipeline failures, including supposedly impossible undetected leaks (or the first detection was someone driving by and noticing a leak) that shake public confidence in the pipeline industry to operate safely.


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## AltaRed (Jun 8, 2009)

andrewf said:


> I have family that lives near North Bay, Ontario, and I hear there is a lot of skepticism about the safety of running dilbit through a pipeline originally designed for natural gas. Natural gas is a lot safer ecologically in the event of a leak. There have been some recent pipeline failures, including supposedly impossible undetected leaks (or the first detection was someone driving by and noticing a leak) that shake public confidence in the pipeline industry to operate safely.


Old wives tales and red herrings generated by conspirators with vested interests...without facts. The steel in gas pipelines is generally the same as the steel in oil/dllbit/bitumen pipelines. The big changes that will cost money is pigging facilities and pumping stations to replace compressor stations. An oil pipeline is actually safer. Leaks do not cause a gas explosion. There are tens of thousands of miles of oil and gas pipelines throughout this continent.


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## AltaRed (Jun 8, 2009)

twa2w said:


> AltaRed, I know why energy east makes sense, re using existing lines etc but has anyone explored building a pipeline through northern Sask and Manitoba to a port on Hudson Bay.
> Iow population area so perhaps fewer objections other than maybe native groups who could likely be convinced with annual fees for crossing land and some jobs.
> Hudson Bay now open to shipping year round but perhaps some ice Berg risk once out in Atlantic.
> Thoughts


Logical sense but can you imagine the outcry of having tankers in Hudson's Bay? The point is that vested interests will scream no matter what is proposed.

Added: One could actually use surplus existing gas pipeline into Manitoba and then veer northeast to Churchill.....and tell ON and QC to 'go stuff it'. But somehow vested interest groups have taken over the agenda in this country and they would rather deprive Canada of needed GDP growth. It continues to mystify me what the 'greens' think they are achieving. Fossil fuel supply will always be developed somewhere to meet demand. We should be asking ourselves... in whose pockets is it better to have oil revenue? http://www.bloomberg.com/gadfly/articles/2016-04-10/saudi-arabia-oil-gambit-moves-to-phase-two


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## bgc_fan (Apr 5, 2009)

AltaRed said:


> The desire, or lack of it, will most likely depend on Russian politics. With the likes of demagogues/bullies like Putin running the show (and his latest initiative with a national guard), Europe will be motivated to have more energy independence. Who knows how long this chapter will last, and whether it gets worse or better.


I guess the other $64K question that I have is whether there actually are plans on the drawing board to actually build or upgrade refineries. Assuming that Energy East goes through, that should be enough lead time for companies to do the work, but is there indication that there are companies that are prepared to do so? If so, I would have thought they would be able to add some urgency/support to the project.


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## twa2w (Mar 5, 2016)

AltaRed said:


> Old wives tales and red herrings generated by conspirators with vested interests...without facts. The steel in gas pipelines is generally the same as the steel in oil/dllbit/bitumen pipelines. The big changes that will cost money is pigging facilities and pumping stations to replace compressor stations. An oil pipeline is actually safer. Leaks do not cause a gas explosion. There are tens of thousands of miles of oil and gas pipelines throughout this continent.


Agreed, I grew up north of North Bay and a trans Canada gas pipeline blew up one night - about 200 meters of pipeline. Thankfully it was in a semi rural area with the nearest houses about 300 meters away. The explosion did take out the road to kapkigawan prov park though,


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## AltaRed (Jun 8, 2009)

bgc_fan said:


> I guess the other $64K question that I have is whether there actually are plans on the drawing board to actually build or upgrade refineries. Assuming that Energy East goes through, that should be enough lead time for companies to do the work, but is there indication that there are companies that are prepared to do so? If so, I would have thought they would be able to add some urgency/support to the project.


I am not versed enough in all the moving parts to be very informative, but Suncor is an obvious one and indeed were, as of last year, considering adding a coker for a few $billion. That may have changed with their purchase of COS but not necessarily. http://www.albertaoilmagazine.com/2015/01/nation-building/ Valero seems to have made long term commitments for lighter crude from elsewhere in North America. Hibernia? Terra Nova? Gulf Coast? Who knows what the Irvings will ultimately do. Ultimately, Montreal/NB refineries have to decide whether the discount for WC dibit/SCO is worth the investment, versus continuing to source elsewhere from tidewater.

Bottom line that pipeline deniers just don't get is that oil that cannot move by pipeline will move by rail. It is not a case of locking oil sands in, albeit it will slow commitments to new production (shipping by rail is not inexpensive relative to pipelines). Imperial Oil built a rail loading facility just for their Kearl Phase 2 project. Better believe that Suncor and CNRL are making their own arrangements as well for their expanded production.


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## twa2w (Mar 5, 2016)

AltaRed said:


> Logical sense but can you imagine the outcry of having tankers in Hudson's Bay? The point is that vested interests will scream no matter what is proposed.
> 
> Added: One could actually use surplus existing gas pipeline into Manitoba and then veer northeast to Churchill.....and tell ON and QC to 'go stuff it'. But somehow vested interest groups have taken over the agenda in this country and they would rather deprive Canada of needed GDP growth. It continues to mystify me what the 'greens' think they are achieving. Fossil fuel supply will always be developed somewhere to meet demand. We should be asking ourselves... in whose pockets is it better to have oil revenue? http://www.bloomberg.com/gadfly/articles/2016-04-10/saudi-arabia-oil-gambit-moves-to-phase-two


Thanks for the reply AltaRed. If people only knew what was shipped on barges up the James Bay hudbay coast already  Lots of mining supplies are railed to moosonee and put on barges and hauled up the coast. Lots of gasoline, heating fuel lubricants etc. Not much in the way of following safety regulations from my untrained eye. just stacked up on a barge, leaking or not.
I see they are now using ice roads out of moosenee as well.
But I guess no where near the volume that a super tanker would carry.


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## AltaRed (Jun 8, 2009)

I agree there is tons of **** transported on everything from barges to rusty vessels to trucks that no one knows, or even cares, about all over our northern waterways, permafrost, etc. No different than what gets shipped down the Mackenzie River either in summer, or the ice road in winter. And as you say, without a lot of sophistication or regulatory oversight. Crude oil tankers simply seem to be a convenient catalyst/lightening rod/media visual for irritants some deem wrong in this country. Political will has been lost. Can you imagine trying to build the transcontinental railroad today through our National Parks and down the Fraser Canyon?


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## olivaw (Nov 21, 2010)

*Canada sets new records in oil trade with U.S*
MICHAEL BABAD
The Globe and Mail
Published Tuesday, Apr. 12, 2016 10:29AM EDT
Last updated Tuesday, Apr. 12, 2016 11:35AM EDT


> “Canada generally produces heavy, sour crude oil that is well matched to processing capacity in the United States, where many refineries have the equipment needed to process such oil,” the EIA said.
> 
> “Canada has few alternative outlets for the heavy crude produced in Alberta, where most of Canada’s proved oil reserves are located,” it added.
> 
> “Canada is expected to continue to provide a large share of U.S. oil imports for the foreseeable future, especially given the expansion of pipeline and rail shipping capacities to transport Canadian oil.”


Trade with the United States always seems to be easier than trade with other Canadian provinces.


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## AlwaysMissingTheBoat (8 mo ago)

Six years later...


__ https://twitter.com/i/web/status/1595979520804376581
No credit to Danielle Smith, who is simply "Jilly on the spot." But Alta is riding high from a resurgence in the energy sector. Enough to hand out $600 to you, and $600 to you and $600 to you. Anyway, congrats to "Canada's Alberta province!"


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## andrewf (Mar 1, 2010)

Extending the long Alberta tradition of blowing the resource endowment. Peak grasshopper mentality.


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## sags (May 15, 2010)

Maybe the conservative faithful will turn down the money.


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## damian13ster (Apr 19, 2021)

13.3bln debt repayment is not terrible.
The payments and credits total 2.6bln for the perspective.
I disagree with them and agree they should be spent on further digging out Alberta out of the hole NDP put them in, but 'blowing resource endowment' is bit excessive.
Now, really wish all levels of governments would use high inflation (so tax on low and middle-class) and high resource revenue to pay down debt instead of continue to rack up deficits unheard of in previous governments.


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## AltaRed (Jun 8, 2009)

That is a red herring. AB surpluses/deficits are almost entirely the result of commodity prices, not political ideology. 2015-2020 was a terrible time for AB at large where social support was necessary to counter the depressed economy. It is like blaming Harper for the deficits of the 2008-2009 financial crisis. Unfortunately, much of the voting public fails to look beyond partisan politics.


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## damian13ster (Apr 19, 2021)

AltaRed said:


> That is a red herring. AB surpluses/deficits are almost entirely the result of commodity prices, not political ideology. 2015-2020 was a terrible time for AB at large where social support was necessary to counter the depressed economy. It is like blaming Harper for the deficits of the 2008-2009 financial crisis. Unfortunately, much of the voting public fails to look beyond partisan politics.


On the revenue side? Agree.
That's why one has to look at the expenses side to judge.
Notley in 2017 had higher spending per person than government spending at the height of the pandemic.
They jacked up the spending despite lack of increase in revenue. Previous governments haven't done that


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## AltaRed (Jun 8, 2009)

I agree there was a spending problem as noted by Alberta Premiers and Government Spending but it was not all that outsized given the economic situation from 2015 onward. Per capital spending often has to increase during economic crises, the only time I find deficit financing justifiable.

Much of the direct covid-19 support in 2020 was federally based not provincially funded.

You will most likely have the opportunity to re-test your views post-May 2023 when I suspect Notley has a better than 50% chance of returning to the premier's chair.


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## fstamand (Mar 24, 2015)

I'm not convinced that handing people money (like provincial government here in Québec) is going to help inflation. Granted people need to pay bills... 

But just before xmas, it will just add fuel to the fire in my opinion -- as people will be tempted to blow it on gifting.


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## AltaRed (Jun 8, 2009)

I don't object to the working poor getting some 'one off' cheques so they don't need to line up at the food banks as often but these blanket cheques to everyone that provide relief on gasoline, electricity et al is inflationary. We will get a $100 credit in Dec from BC Hydro as part of our new premier's (Eby) largesse that we absolutely do not need.


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## damian13ster (Apr 19, 2021)

AltaRed said:


> I agree there was a spending problem as noted by Alberta Premiers and Government Spending but it was not all that outsized given the economic situation from 2015 onward. Per capital spending often has to increase during economic crises, the only time I find deficit financing justifiable.
> 
> Much of the direct covid-19 support in 2020 was federally based not provincially funded.
> 
> You will most likely have the opportunity to re-test your views post-May 2023 when I suspect Notley has a better than 50% chance of returning to the premier's chair.


There wasn't a crisis all of 2015 - 2019. 2016 was the only challenging year for O&G. Yet every single year the spending went up significantly.


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## AltaRed (Jun 8, 2009)

I bed to differ on your characterization. WCS oil alone was in the dumpster for those years WCS oil price 2005-2021 | Statista O&G development fell considerably during those years. My friends and relatives in the industry know it all too well over those years plus long suffering investors in O&G stocks.

I do agree royalty revenue was on its way to recovery in 2019 fiscal year before covid killed it all in 2020. Historical royalty data

Try to be a bit more objective./neutral/balanced rather than being so partisan.


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## damian13ster (Apr 19, 2021)

I am.
Was WCS price in 2017 higher than in 2016? Yes.
Was WCS price in 2018 higher than in 2017? Yes
Was WCS price in 2019 higher than in 2018? Yes

Was government spending in 2017 higher than in 2016? Yes
Was government spending in 2018 higher than in 2017? Yes
Was government spending in 2019 higher than in 2018? Yes.

There is no negative correlation between WCS price and government spending from 2015-2019.
Spending increased by significantly more than population growth and inflation.

I worked in industry from 2016 to 2020 as well. Simply what you are trying to tell isn't reflected in numbers. Government spending increased by rapid pace, despite year 2015 and 2016 being only years where oil patch was doing very bad.

NDP doesn't just spend more in bad times. It always spends more.
And the problem is that when spending is increased - it is really hard to roll that back because you automatically lose next election, so responsible governments who have to clean up the mess after irresponsible ones don't last long


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