We Need To Ask What Would Ralph Klein Do

[Anonymous]

Among Evangelical Christians there's a popular test of whether a proposed action is moral or not: WWJD, for What Would Jesus Do?



We want to propose a similar test for Alberta's Tory government as they confront declining revenues caused by plummeting oil prices: WWRD? What Would Ralph Do?



If Premier Ralph Klein were facing a $7-billion drop in revenues in the coming year, how would he handle it? Would he introduce a provincial sales tax? Would he get rid of our flat tax on personal income in favour of the left's preferred "progressive" tax (although we fail to see what is progressive about punishing hard work and success).



Klein's answers would be NO and NO!



When Klein took over as premier in December 1992, the province was in far worse financial shape than it is today.



The government of Premier Jim Prentice projects a revenue drop of $7 billion in 2015 and a net deficit of approximately $5.5 billion. The $3.4-billion deficit Klein inherited from his predecessor, Don Getty, would today be about $5.1 billion.



But Ralph came into office with no contingency fund. Prentice has about $5 billion in the treasury for emergencies just like the one Alberta is facing today



Yet instead of giving in to the easy solution – raising taxes – Klein and his Treasurer Jim Dinning cut spending in a big way.



Over their first four budgets, Klein and Dinning eliminated 18% of provincial expenditures. Spending went from nearly $18 billion in 1993 to just $14.4 billion in 1996-97.



To give an idea of just how enormous an achievement that is, consider that the Ontario premier at the time, Mike Harris, is still considered a massive slasher of public spending. Harris cut expenditures by just 4%.



Alberta's current government would have to cut spending by about 15% -- three percentage points less than Klein cut – to get its budget into balance even with halved resource revenues.



To be sure, Premier Ralph didn't complete his budget cutting in a single year. It took him four budgets to achieve a balance. And because he avoided raising taxes, his government did take on debt, about $11 billion on top of the $16 billion they inherited from the Getty administration.



So the Prentice government may have to take on a little debt, too, if it wants to avoid raising taxes at the beginning of an economic slowdown.



People in the patch are losing their jobs. Small companies that supply major oil producers are cutting their workforces to avoid going out of business. Raising taxes is rarely a good idea even in good times. In poorer times, such as our province may be entering now, higher taxes are a horrible idea.



Alberta has one of the most oversized, best-paid public-sector work forces in the country, including nearly 10,000 working for Alberta Health Services who among themselves are paid close to $1.5 billion.



Make deep cuts, Mr. Premier, before your raise taxes. And whatever you do, don't introduce a PST.

[Anonymous]

Among Evangelical Christians there's a popular test of whether a proposed action is moral or not: WWJD, for What Would Jesus Do?



We want to propose a similar test for Alberta's Tory government as they confront declining revenues caused by plummeting oil prices: WWRD? What Would Ralph Do?



If Premier Ralph Klein were facing a $7-billion drop in revenues in the coming year, how would he handle it? Would he introduce a provincial sales tax? Would he get rid of our flat tax on personal income in favour of the left's preferred "progressive" tax (although we fail to see what is progressive about punishing hard work and success).



Klein's answers would be NO and NO!



When Klein took over as premier in December 1992, the province was in far worse financial shape than it is today.



The government of Premier Jim Prentice projects a revenue drop of $7 billion in 2015 and a net deficit of approximately $5.5 billion. The $3.4-billion deficit Klein inherited from his predecessor, Don Getty, would today be about $5.1 billion.



But Ralph came into office with no contingency fund. Prentice has about $5 billion in the treasury for emergencies just like the one Alberta is facing today



Yet instead of giving in to the easy solution – raising taxes – Klein and his Treasurer Jim Dinning cut spending in a big way.



Over their first four budgets, Klein and Dinning eliminated 18% of provincial expenditures. Spending went from nearly $18 billion in 1993 to just $14.4 billion in 1996-97.



To give an idea of just how enormous an achievement that is, consider that the Ontario premier at the time, Mike Harris, is still considered a massive slasher of public spending. Harris cut expenditures by just 4%.



Alberta's current government would have to cut spending by about 15% -- three percentage points less than Klein cut – to get its budget into balance even with halved resource revenues.



To be sure, Premier Ralph didn't complete his budget cutting in a single year. It took him four budgets to achieve a balance. And because he avoided raising taxes, his government did take on debt, about $11 billion on top of the $16 billion they inherited from the Getty administration.



So the Prentice government may have to take on a little debt, too, if it wants to avoid raising taxes at the beginning of an economic slowdown.



People in the patch are losing their jobs. Small companies that supply major oil producers are cutting their workforces to avoid going out of business. Raising taxes is rarely a good idea even in good times. In poorer times, such as our province may be entering now, higher taxes are a horrible idea.



Alberta has one of the most oversized, best-paid public-sector work forces in the country, including nearly 10,000 working for Alberta Health Services who among themselves are paid close to $1.5 billion.



Make deep cuts, Mr. Premier, before your raise taxes. And whatever you do, don't introduce a PST.

I started my career with the Alberta government when Ralph Klein was our provincial leader..



I never experienced the draconian cutbacks of the nineties, but some of the ladies I worked with did..



They do not have fond memories of that time.

[Anonymous]

^Under Ralph, you could easily get another job if your unnecessary taxpayer funded one was cut in order not to pass the bill on to me and my son.

[Anonymous]

^Under Ralph, you could easily get another job if your unnecessary taxpayer funded one was cut in order not to pass the bill on to me and my son.

I am not one of those public servants that earns over $100,000..



My salary is not even close to $100,000 and most of us in the Alberta public service do not earn that either..



I understand living within our means, but not at the expense of working people..



Not at the expense either of reducing the delivery of health care or cutting what we spend to keep our environment clean or reductions in AISH which our most vulnerable members of society needs to live..



That is not an Alberta I would be proud of.

[Anonymous]

^Under Ralph, you could easily get another job if your unnecessary taxpayer funded one was cut in order not to pass the bill on to me and my son.

I am not one of those public servants that earns over $100,000..



My salary is not even close to $100,000 and most of us in the Alberta public service do not earn that either..



I understand living within our means, but not at the expense of working people..



Not at the expense either of reducing the delivery of health care or cutting what we spend to keep our environment clean or reductions in AISH which our most vulnerable members of society needs to live..



That is not an Alberta I would be proud of.

We came to Canada less than a year after Ralph won his first election as premier. I don't remember the 90's, but I know people had more money in their pockets, not less. I know he not only wiped out the deficit, but also the debt. He lowered taxes, increased speeds on our highways, making goods get to market faster and sold off debt-ridden provincially owned corporations.



He also created the sustainability fund which paid for things like the Henday and Stony where you live. All of this while oil and gas were low. It was one term of sacrifice for making your kids and my son's lives less burdened with debt. Everybody wants the province to balance the books, but only as long as they are not the ones that have to tighten their belts.



Again, you want balanced budgets and low taxes think Ralph, think about what King Ralph would do.

[Anonymous]

^Under Ralph, you could easily get another job if your unnecessary taxpayer funded one was cut in order not to pass the bill on to me and my son.

I am not one of those public servants that earns over $100,000..



My salary is not even close to $100,000 and most of us in the Alberta public service do not earn that either..



I understand living within our means, but not at the expense of working people..



Not at the expense either of reducing the delivery of health care or cutting what we spend to keep our environment clean or reductions in AISH which our most vulnerable members of society needs to live..



That is not an Alberta I would be proud of.

We came to Canada less than a year after Ralph won his first election as premier. I don't remember the 90's, but I know people had more money in their pockets, not less. I know he not only wiped out the deficit, but also the debt. He lowered taxes, increased speeds on our highways, making goods get to market faster and sold off debt-ridden provincially owned corporations.



He also created the sustainability fund which paid for things like the Henday and Stony where you live. All of this while oil and gas were low. It was one term of sacrifice for making your kids and my son's lives less burdened with debt. Everybody wants the province to balance the books, but only as long as they are not the ones that have to tighten their belts.



Again, you want balanced budgets and low taxes think Ralph, think about what King Ralph would do.

I am much less concerned about how my own family will cope than people who are not as fortunate as we are.

[Lance Leftardashian]

People should be thankful they are allowed to keep any money they work for. Everything is community property. If they are allowed to keep a little for themselves, they should at least show some gratitude that society is being so generous.

[Anonymous]

^If your money is everybody else's then feel free to send it to me....fucking troll. ac_doofus

[Blue Eyed Arab]

What would RK do? Nothing, because Alberta's financial situation would be such that it could weather a temporary or extended downturn. He had Alberta out of debt but it has been returned to it's formal shambles by a pig farmer, a totally out of touch ex (let's wallow at the public trough) Liberal UN lawyer and now another slick talking greasy lawyer who was parachuted in to make sure that the PC's hold on to power. If another party ever got in the roar of paper shredders in Edmonton would be audible in Medicine Hat.





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[Anonymous]

^[size=200]BULLSEYE!![/size]

[Obvious Li]

^[size=200]BULLSEYE!![/size]

hi princess...I never was a fan of Klein...but in hindsight it looks like he was the best of the bunch by a long shot....

[Anonymous]

^
The ladies I work with who remember the nineties cuts would disagree with you Obvious Li.

[Obvious Li]

^
The ladies I work with who remember the nineties cuts would disagree with you Obvious Li.

hahaha oh for sure they would...but you govt. workers need a haircut now and then just to keep you honest....I hope you are the last govt. worker laid off.....let me know when that happens...I will hire you as my personal chef... ac_dance

[Anonymous]

hi princess...I never was a fan of Klein...but in hindsight it looks like he was the best of the bunch by a long shot....

The ladies I work with who remember the nineties cuts would disagree with you Obvious Li.

hahaha oh for sure they would...but you govt. workers need a haircut now and then just to keep you honest....I hope you are the last govt. worker laid off.....let me know when that happens...I will hire you as my personal chef... ac_dance

Lol, I would make sure you had flavourful and healthy meals each and every night.

 ac_biggrin

[Anonymous]

This is courtesy of Scott Hennig, acting director of the Canadian Taxpayers Federation.

Alberta's 16th premier has a lot in common with Alberta's 11th and 12th premiers. But if Jim Prentice hikes taxes or introduces a new provincial sales tax (PST), he will be repeating a history most Albertans would rather forget.



Don Getty became Alberta's 11th premier in November 1985.



On the day he was sworn in, oil sat at $30.81 per barrel. Four months later, oil prices plummeted to $12.62, turning a small deficit into a large one.



Jim Prentice became Alberta's 16th premier on Sept. 15, 2014. On that day, oil was sitting at $92.86 per barrel. By Jan. 15, oil prices had dropped 50 per cent, making the giant hole in the provincial budget even larger.



Getty inherited a government that had been spending like drunken sailors. In today's dollars, Getty's first budget spent nearly $12,000 per Albertan on programs — by far the highest in the nation.



Prentice has inherited a government that has been spending like bankers at a bachelor party. Last year the government spent nearly $10,800 per Albertan on programs — nearly the highest in the nation.



The rest of Don Getty's story is written, whereas Prentice's is not.



Getty opted to run up the credit-card bills and hike taxes. His 1987 budget raised business taxes by more than a third, health-care premiums by 28 per cent, nursing-home fees by 40 per cent, new fuel and hotel taxes were introduced and liquor taxes, insurance taxes and income taxes went up across the board. However, the one tax he would not touch was the introduction of a provincial sales tax.



Ignoring possible spending reductions, taking on debt and hiking taxes did little for the budget and nothing for Alberta's economy.



Alberta's 12th premier, Ralph Klein, never faced a rapid, massive drop in oil prices during his tenure — mostly because they were very low for half of his time in office. Oil prices never reached $30 a barrel again until February of 2000 — over seven years into his time as premier.



But like Prentice, Klein inherited a systemic, long-term deficit. When Klein took office, the books hadn't been balanced for seven straight budgets. And again today, we are nearing the end of the seventh straight budget that hasn't truly been balanced (as long as you don't count borrowing billions, draining contingency funds or changing the definition of a balanced budget).



Even during the days of $11 oil (prices actually hit $10.86 in December of 1998), Klein never hiked income taxes or mused about the introduction of a PST. In fact, Klein was so opposed to a PST that his government passed the Taxpayer Protection Act — a law in place today that would require the Prentice government to take a PST to a provincewide referendum.



Klein recognized that spending was the real problem, not revenue. The same is true today. Last year, Alberta spent 21 per cent more, per citizen, than neighbouring British Columbia. We are one of the highest-spending provinces in the nation.



While low oil is far from ideal, it's no excuse to hike income taxes or introduce a PST. Premier Prentice would be wise to look at the similarities he shares with both Getty and Klein and decide which history to follow.



He can hike taxes, maintain sky-high spending and deficit budgets while driving Alberta's economy into the ditch like Getty — or cut spending, balance the books and eventually get to lower taxes like Klein.



The choice should be obvious.