This Glorious Mess We Made

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I have to simply laugh at the amount of panic this proposed “carbon tax” has created for Albertans and simply shake my head at how we got to this point.

The fact is we’re not getting $130 a barrel oil any more. We’ll be lucky if we top $60 by the end of this year and I would be stunned if we get back to even $100 any time soon. That was Alberta’s main source of revenue and the moment oil prices went for a dive, we did too.

We had 40 years of PC rule in this province and PLENTY of opportunities as the richest province to invest in other revenue streams – to diversify ourselves as it were – and they never really did because Albertans were just fine with status quo. Yes we had slumps before but we weathered them well enough, so why change anything right?

On that same train of thought, we’ve repeatedly refused to raise oil royalties. Hell, even just the thought of us looking into the notion sent spikes of fear through the populace which of course the big oil companies gladly went along with and stoked the fires of because even if internally you’re preparing for Alberta to ask for a larger share of the profit pie, what self-respecting CEO would go “don’t worry everyone, it’s totally fine that we give more of our profits to Alberta! We agree that all of you aren’t getting a fair share, let’s work something out!”

So we refuse to raise oil royalties. There goes that revenue source.

What about PST? Every other province has it.. A provincial sales tax would be millions of dollars in reven… NOPE!

No PST the people of Alberta have cried out! Not now! We can’t afford it and it would take away from our “Alberta Advantage”! No PST, not even 4% so we could still claim the lowest PST in Canada.

There goes another source of revenue out the window.

Meanwhile the government says “Ok, well.. You all know we still have a shortfall of money coming in because of those pesky low oil prices, so things have to get cut from expenses.” And to their credit the people of Alberta say “Well ok fine, but not important stuff! We don’t need you guys going all Ralph Klein on us!”

To that end the NDP said “Perish the thought, but since you all demand it, we won’t cut from things like Education and Health because honestly those are in poor shape as it is. Instead, let’s cut from things like our forestry fire budget because maybe the fires won’t be so bad this yea…”

BIGGEST WILDFIRE IN THE HISTORY OF EVER HAPPENS.

Welp, so much for cutting any of that.. Hell, the price tag for that not to mention the recovery just multiplied by a whole lot.

(As a quick aside, the funny thing about budgets is that they are “suggestions” of what will be spent in the coming fiscal year.. So just because the budget said they’d only spend so much on forest fires, that doesn’t mean that once the money allotted was used up that they just stopped fighting fires. They put all the money and resources needed into it but that didn’t stop so many Albertans from crying about the cuts to the budget because it sounded good right? But that’s another story for another day)

Anyway.. The government decided “Welp, we may as well run a deficit because we can’t make all the cuts we would need to make to balance this thing, and because the people refuse to let us add things like higher oil royalties and / or a PST, we have no way of making up the lack of revenue we had back when the PC’s had the benefit of $130 a barrel oil”

This too also made Alberta angry. Now we’re in DEBT! OH NOEZ!! THINK OF THE CHILDRENS!!

(It’s at this point I myself start to wonder if people understand how basic math works.. )

MEANWHILE BACK AT THE LEGION OF DO.. errr.. Legislature.

We’re still in this whole “depending on oil to save our ass” rut that we NEED to get out of and have needed to get out of for decades. In all honesty, it’s really what got the NDP voted into power in the first place.

Remember when we started doing a nose dive and just before the election the PC party was like “Well this kinda sucks huh? Maybe we need to look at getting away from our dependence on oil…” and the majority of voters were like “Yeah, well you guys seem too busy being all corrupt and stuff so we’ll try someone else now.”

New energies need to be invested in because not only can no one be sure if we’ll ever get back to $130 a barrel oil ever again, there is no promise it will ever get north of $80! We need to do that whole diversify thing mentioned at the top but only now is a really shitty time to do that. Problem is, say for instance we don’t do it now and try to wait for a better time when the economy gets a little bit better… What if it doesn’t any time soon?

As a friend of mine who is more in-tune with our economic climate than I am put it: “This could be the new ‘normal’.” Maybe $55 a barrel oil is as good as it gets for a really long time. We’re already suffering for having not moved forward and away from oil dependency when we were in a position to do so, why keep delaying it because “now isn’t a good time for us”?

We can’t keep living like this as a province. Running a deficit for a year or two is actually fine (no really it is) but you need to have a strategy far better than “hope the price of oil goes back up soon” so diversify and invest in new technologies and energy it is.

There is more added expenditure there. Something needed to give.

Enter the carbon tax.

Look, I’m not overly thrilled about it either – you think anyone goes “Yay, we get to spend an extra 50 to 100 bucks in taxes!”? Of course not.

But this province needs to raise revenue somehow and because we didn’t want a PST or to “scare away” oil companies with higher oil royalties, and because we didn’t want to cut any major programs let alone being aghast that a relatively minor program saw cuts moments before we had one of the worst natural disasters in province history, and because we didn’t expand our ability to earn anything outside of the oil industry in the last 40 years so, now we’re suffering from that lack of foresight…

My fear is this carbon tax will likely get killed in the Legislature as well, and we’ll just continue our cycle of provincial economic stupidity where we collectively as a province sit around with our heads up our asses waiting for oil prices to once again save us.

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