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Unread postPosted: June 19th, 2019, 6:12 pm 
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Government spending in Ontario and Alberta has grown too fast and the best way to deal with that is what we did in the 90's and that is shrink the size of the monster.

By Ben Eisen of the Fraser Institute

As the new UCP government prepares its first budget, it should heed the lessons of Canadian history and move to eliminate the province’s budget deficit quickly rather than take the “slow and steady” approach that has so often been found wanting across the country.

A few numbers illustrate the severity of Alberta’s deficit problem. Alberta’s budget deficit for the 2019-20 fiscal year is currently forecasted to be $7.9 billion.

That means the government is spending more than $1,800 more than it takes in for every Albertan this year alone.

And big deficits are nothing new — the province has run nearly uninterrupted deficits since 2008.

As a result of all these deficits, current forecasts show that Alberta will surpass $50 billion in net debt by 2021-22.

For context, Alberta had no net debt at all (meaning its financial assets exceeded its liabilities) as recently as 201516.

This is a remarkable pace of debt accumulation which, per-capita and relative to GDP, greatly exceeds what’s taking place in any other Canadian province except Newfoundland.

To understand the right solution to those problems, it’s first important to identify the cause — rapid spending growth by successive governments dating back to the early 2000s.

Since then, provincial spending has markedly outpaced what would have been needed to offset cost pressures from inflation and population growth.

If spending had been kept in line with inflation plus population, the rapid run-up in debt simply would not have happened.

So since spending is the source of Alberta’s fiscal challenges, the new government must strike at its root by reforming and reducing spending to solve it.

If the Kenney government is willing to take this approach, Canadian history suggests the deficit can be eliminated quickly.

Indeed, during the 1990s, governments across Canada faced severe fiscal challenges. Whether it was the NDP government of Roy Romanow in Saskatchewan, the federal Liberal government of Jean Chretien in Ottawa, or the Progressive Conservative government of Ralph Klein in Alberta, these governments reduced spending significantly to slay their deficits in three years or less.

This stopped the rapid accumulation of debt and set the stage for tax relief that helped contribute to future prosperity.

Since then, a different “slow and steady” approach to deficit-reduction has come into style in Ottawa and many provincial capitals.

Under this approach, governments have tried to shrink their deficits gradually over time by continuing to increase spending — but at lower rates than forecasted revenue growth to close the gap between the two over time.

This strategy generally has not proved successful.

The slow-and-steady approach to deficit reduction was perhaps best exemplified by the two governments of Mcguinty and Wynne in Ontario following the 2008-09 recession.

Once the recession ended, those governments laid out a lengthy plan to balance the budget by 2017-18.

So what happened?

The deficit did creep down over time, but never was eliminated.

And meanwhile, Ontario’s debt soared to more than $24,000 per person.

If Alberta pursues a similar strategy now, it’s likely to experience similar outcomes.

In crafting its deficit-reduction plan, Premier Kenney’s government will face the options of going slow or moving quickly.

The latter course has several advantages, including reducing the amount of debt that we place on the shoulders of future generations of Albertans.

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Unread postPosted: June 19th, 2019, 6:33 pm 
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After years of spending increases well above the rate of inflation, the Sask Party is making minor cuts to bring us back to a balanced budget, probably by the end of this year. But, if you drive anywhere, you see billboards warning kids won't schools to attend and necessary surgeries won't be paid for. The same with ads on radio stations. They are paid for by provincial unions and their big money NGO allies. They are blatant exaggerations of course.

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Unread postPosted: August 6th, 2019, 10:31 pm 

Joined: October 4th, 2012, 10:25 pm
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The UCP government delivered on another key campaign promise:

Alberta MLAs will receive a 5% cut..

The Premier will receive a pay-cut of 10%..

The NDP left Alberta on track to hit $100 billion in provincial debt in just a few years.


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Unread postPosted: August 7th, 2019, 8:59 am 
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Quote:
the Progressive Conservative government of Ralph Klein in Alberta

When Ralph klein was premier, Jason Kenney was the head honcho of the Canadian taxpayer federation. Ralph actually took a lot of Jason's advice, and Alberta was "paid in full" by 2004. So far, Jason is doing a good job in spite of the NDP's attempted fillibustering. It is probably the most the NDP worked in the past 4 years. :laugh3:

Quote:
and big deficits are nothing new — the province has run nearly uninterrupted deficits since 2008.

Well, considering Alberta didn't have a real conservative government since 2006. Ed stalmach and Allison Redord were red tory dumpster fires that ramped up spending, and then there was the split of the conservative element from the PC's and the formation of the wildrose party(which danielle smith backstabbed).


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Unread postPosted: August 7th, 2019, 5:35 pm 

Joined: October 4th, 2012, 10:25 pm
Posts: 41381
sasquatch wrote:
Quote:
the Progressive Conservative government of Ralph Klein in Alberta

When Ralph klein was premier, Jason Kenney was the head honcho of the Canadian taxpayer federation. Ralph actually took a lot of Jason's advice, and Alberta was "paid in full" by 2004. So far, Jason is doing a good job in spite of the NDP's attempted fillibustering. It is probably the most the NDP worked in the past 4 years. :laugh3:

Quote:
and big deficits are nothing new — the province has run nearly uninterrupted deficits since 2008.

Well, considering Alberta didn't have a real conservative government since 2006. Ed stalmach and Allison Redord were red tory dumpster fires that ramped up spending, and then there was the split of the conservative element from the PC's and the formation of the wildrose party(which danielle smith backstabbed).

:laugh:


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Unread postPosted: August 14th, 2019, 8:50 am 
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It seems Alberta's public sector employees are spoiled rotten. The province can no longer afford an entitled civil service while the private sector is punished by Ottawa. I hope that Kenney has the courage of his convictions and stands by any modest cuts. Ford caves in every time there is a public sector protest.

Franco Terrazzano is the Alberta Director for the Canadian Taxpayers Federation

Tough measures for tough times

Tough times require tough questions. One question is looming large in Alberta. When you look at government job growth, salaries, benefits and provincial comparisons you have to ask: when will Alberta’s government employees share in the tough times?

Unfortunately, that reality seems to be lost on some people.

“These folks and many, many others across the province took two years of zeros and negotiated this opportunity to have discussions around their wages for the third year,” said Guy Smith, president of Alberta Union of Provincial Employees (AUPE) prior to the union heading into arbitration hearings with the provincial government.

After reading a statement like that, you’d think our government employees have taken it on the chin, but you’d be wrong.

For thousands of government employees, “pay freezes” over the last few years weren’t actually pay freezes. While government employees may not have been rewarded with a new pay grid, they could still receive a raise by moving up their current grid.

A freedom-of-information request filed by the Canadian Taxpayers Federation shows that the “pay freeze” for nurses cost $17 million in 2017. The “pay freeze” for teachers cost an estimated $200 million over two years.

Even if government employees had their wages frozen, cuts would still be warranted.

Many Albertans outside of government would have killed for a wage freeze during the recent recession. Thousands of families dealt with pay cuts, layoffs, underemployment and other difficult situations. But instead of relief, taxpayers were forced to shell out more tax money to pay for a growing government workforce.

Net private sector employment has declined by 39,700 jobs since May 2015 … The Alberta NDP added 58,600 jobs in the broad public sector — paid by taxes on the private sector,” explains economist Jack Mintz.

Total workers’ pay in Alberta has declined by seven per cent since 2014 highs. Yet total pay for government employees increased by 12 per cent between 2014 and 2018, according to government budgets.

And this followed years of increasing government pay. Between 2000 and 2010, the government’s wage tab increased by 119 per cent, almost double the rate of growth in the rest of Canada.

Government employees in Alberta (at all levels) earn a 10 per cent wage premium compared to counterparts in the business community, according to the Fraser Institute. Then there’s the lucrative benefits that are scarce outside of government.

Government employees are much more likely to be covered by a workplace pension, are more likely to receive a costly defined-benefit pension, retire earlier, enjoy greater job security and lose more work time for personal reasons.

Government employees in Alberta are also overpaid compared to other large provinces.

“Alberta could have saved around $2.1 billion in 2016, if public sector salary levels were the same as the average of the three biggest provinces (British Columbia, Ontario and Quebec),” state former Saskatchewan NDP Finance Minister Janice Mackinnon and University of Calgary economist Jack Mintz.

Even politicians are sharing in Alberta’s tough times as MLAS will be paid $13,000 less compared to 2014 and Premier Jason Kenney will rake in $31,500 less.

Albertans are currently staring down the barrel of a $60-billion debt tab that is increasing by $1.7 million every single hour. But the only way we’re going to get the province’s fiscal house in order is by bringing government labour costs back to reality.

_________________
A claim for equality of material position can be met only by a government with totalitarian powers. Friedrich August von Hayek


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Unread postPosted: October 23rd, 2019, 4:19 pm 
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The Kenney government inherited a monstrous, unmanageable debt from the NDP. One way they can restore investor confidence is to pay the deficit down to zero ASAP.

By Ben Eisen, senior fellow at the The Fraser Institute

Kenney government should discard ‘wait and hope’ budget strategy

With the federal election now behind us, all political and policy eyes in Alberta have turned to the Kenney government’s first budget, to be tabled Thursday.

We’ll likely learn a lot about how the United Conservative Party plans to govern, and whether it will take the same passive and painfully slow approach to reducing the province’s deficit embraced by its predecessor.

Or if it will instead reform and reduce government spending and eliminate the deficit quickly.

Let’s flashback to the start of the Notley government’s term in office when the NDP inherited a terrible fiscal situation.

Spending growth by preceding governments, combined with a rapid drop in government revenues due to the oil-price collapse of 2014, had produced a massive budget deficit.

Unfortunately, the Notley government took a passive and meandering approach to addressing this big problem, and continued to increase nominal spending year after year (even as other hard-hit energy jurisdictions tightened their belts).

As a result, large deficits persisted.

Over the years, the government tabled various budgets showing paths to either deficit-reduction or deficit-elimination.

But these too were passive and fraught with risk, relying on economically-harmful tax hikes (that didn’t bring in that much new revenue anyway) and a fingers-crossed hope that rising oil prices would raise revenues and solve the deficit for it.

In other words, the Notley government hoped for another ride up the “resource revenue roller coaster” it so often (and correctly) decried in opposition as a misguided fiscal strategy.

Indeed, it’s tempting for Alberta governments to avoid hard decisions about government expenditures during tough times in hopes that rising oil prices will eventually save the day.

But again, this approach gambles with the well-being of future generations who eventually must pay the interest on the resulting debt if things don’t pan out.

On Thursday, we’ll learn whether the Kenney government will take this same passive risky approach by continuing to increase nominal spending like its predecessor while hoping for higher resource revenue down the road to eliminate the deficit.

Or if it will take a more active approach to deficit-reduction by targeting provincial government spending.

The reality of Alberta’s situation is daunting.

A half-decade removed from the oil-price decline, the province still faces an annual operating deficit of $7.9 billion and has racked up $37.7 billion in net debt, which is forecast to hit $56.9 billion by 2022-23 unless the government changes course.

Government revenues in all provinces — but especially Alberta — are unpredictable.

What the Kenney government can control, however, is how much it chooses to spend.

To ensure a brighter fiscal future for Albertans and future generations, the UCP government must abandon the “wait and hope” approach to deficits and take active steps to balance the books.

_________________
A claim for equality of material position can be met only by a government with totalitarian powers. Friedrich August von Hayek


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Unread postPosted: November 9th, 2019, 4:18 am 
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This is good for all of Canada. The new Alberta government is undoing the job killing damage of the previous NDP regime.

Province loosens oil production limits
New rules to prompt companies to drill more wells

New rules on Alberta oil production limits designed to prompt companies to drill more wells are a “very, very positive signal to the market,” according to an association of drillers.

“This is a good short-term announcement," said Mark Scholz, president and CEO of the Canadian Association of Oilwell Drilling Contractors, on Friday. "It’s certainly not going to be a long-term fix.”

The companies that support conventional oil wells — pump jacks drawing liquid out of the ground — have “taken a beating” since the former NDP government put limits on Alberta’s oil production in January 2019, Scholz said. He called oil curtailment a “necessary evil.”

On Friday, Energy Minister Sonya Savage said that starting immediately, any oil produced from a new well will not be subject to those limits.

Although they wouldn’t provide estimates, the province expects the change will spur producers to drill hundreds of new wells and that each new well will create about 145 jobs.

“While we want an orderly exit out of curtailment altogether, our communities and drilling sector cannot wait,” Savage told a legislature news conference Friday.

“That is why we’re taking this action today to encourage investment and bring back jobs.”

In September, Alberta produced 480,000 barrels a day of conventional oil. About onefifth of that was from operators working under the curtailment rules.

There are exemptions in place so that small producers are not affected by the limits.

The move is the latest action by the government to try to increase investment and employment in Alberta’s oil and gas industry and reverse years of declines in drilling.

Due to pipeline bottlenecks, the former NDP government limited the amount companies could produce to prevent a surplus, such as the one last year that sharply reduced prices for Alberta oil.

The United Conservative government has since extended the limit by one year to the end of 2020.

Savage said Friday by the time extra oil from the new wells is ready for shipping, there should be more pipeline capacity, such as Enbridge’s retrofitted Line 3 to the U.S. Midwest, and more rail cars. That should avoid another surplus that would hurt prices for Alberta oil, she said.

“We wouldn’t be doing this if we were not confident that this (change) could handle it,” said Savage.

Last week, the province announced it was easing production limits for companies shipping any extra crude by rail.

Premier Jason Kenney’s government is trying to offload $3.7 billion in contracts signed with rail companies by the previous NDP government to buy and ship more oil by rail to ease the bottleneck.

The province has said that deal was a money-loser for taxpayers.

Asked about when the rail contracts may be offloaded, Savage said: "We’re getting very close. We’re anxious to get those contracts finalized, but at this point we’re still in some complex negotiations (and) very competitive bids.

The drilling contractors’ association said this year’s revised well drill count is 4,896, well short of the original forecast of 6,962.

Scholz said the group will have to retool its forecast for 2020, saying Friday’s announcement will make a material difference to what was a bleak outlook.

It was good timing for the new rule, as more than half of drilling happens in the winter months, he said. What drillers want in the longer term is more ways to move oil to market, he said.

Lower operating costs, the exchange rate and year-round drilling have made the United States a more attractive option for Canadian drillers.

_________________
A claim for equality of material position can be met only by a government with totalitarian powers. Friedrich August von Hayek


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Unread postPosted: November 9th, 2019, 4:21 am 
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I expect in two years time, we will see tangible fruits of the Alberta government's pro jobs agenda.

Alberta employment inches up: survey

White-collar jobs including ones in the medical and scientific sector are on the rise in Alberta while the oil and gas industry continues to struggle.

The latest Statistics Canada labour force survey, released Friday, has Alberta’s employment up marginally by 0.3 per cent from September to October. That equates to roughly 14,400 more fulltime jobs, however, the province lost 6,700 parttime jobs.

Major gains were seen in sectors like health care, business, insurance, and real estate as well as wholesale and trade. Employment in the professional, scientific and technical service sector also saw a boost.

Economic Development Minister Tanya Fir welcomed the news that Alberta saw some gains last month.

“Job numbers can fluctuate widely month to month,” Fir said. “Nevertheless, today’s latest data from Statistics Canada is encouraging with 14,400 full-time jobs in October and growth of 20,600 in the private sector. Yet with an inherited fiscal mess from the previous government and challenges from Ottawa, we know there is much more to do to get Alberta back on track.”

Fir said many Albertans are still looking for work and the government plans to get the province back on track.

Alberta’s natural resources sector, which includes oil and gas, mining and forestry, only added 1,600 jobs in October. The sector as a whole is down 12 per cent compared to October 2018.

The biggest hit to Alberta’s employment happened in what is known as “other services” which covers a wide range of jobs including mechanical repairs, funeral services, pet care and religious activities. That sector dropped by five per cent from September to October, losing about 6,100 jobs.

Jobs in the public administration category dropped slightly at 3 per cent or 2,400 jobs.

Edmonton’s employment rose slightly by 0.2 per cent with 1,500 jobs added while unemployment dropped by two per cent. In comparison, Calgary’s employment dropped by 0.3 per cent.

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A claim for equality of material position can be met only by a government with totalitarian powers. Friedrich August von Hayek


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Unread postPosted: November 9th, 2019, 11:54 am 
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Notley made Trudeau look competent.

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Unread postPosted: November 9th, 2019, 1:01 pm 
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Herman wrote:
Notley made Trudeau look competent.

She sure left a mess behind that will take some time to fix.

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Unread postPosted: November 10th, 2019, 7:47 am 

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Fashionista wrote:
Herman wrote:
Notley made Trudeau look competent.

She sure left a mess behind that will take some time to fix.

That is what seventeen years of NDP rule did ti future generations of Manitobans.

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