Setting it straight
In politics, truth is a matter of perception, it never ceases to amaze me how when people are confronted with irrefutable facts, they still refuse to accept something as true. I say this as a means to show that I am prepared to accept that people will not believe what I am about to write, however, you should know that it can all be proven with facts.
I have read many letters to the editor, and heard many comments during election campaigns and public forums, and they all contain the same untruth. They all claim that the only reason Alberta is in such good financial shape is because of high oil prices. They make this claim in an attempt to discredit the Government from taking credit for putting Alberta on the right "fiscal path." One person even claimed that it was so simple to move money from pot A to pot B that even a monkey could do it, and he thought himself very clever for such a weak moniker.
The truth is this people, if not for the fiscal restraints and change in policy brought in 1993-94, even with Oil and Gas prices at an all-time high, the Alberta Government would have a $65 Billion dollar debt today.
People should remember that before they so easily shrug off the work that Premier Klein and his government have done.
posted by Anonymous @ Thursday, March 30, 2006
12 comments
12 Comments:
The Klein gov't is making the same mistakes Getty did and have started spending like drunken sailors when times were good.
Sound fiscal policy in the early 90s will mean nothing when we go back into debt after gas prices fall.
I'm not claiming that the Conservatives are perfect in every decision they have made, I am just trying to right the wrong that is being committed on a daily basis by people who mistakenly believe that any fool could have done what the Conservatives have done.
As for the so-called "infrastructure deficit", I would much rather have a 10 billion dollar infrastructure deficit, then a $65 billion dollar provincial debt.
And "anonymous" you are wrong when you said "Sound Fiscal policy will mean nothing.." It means everything because we have no debt, so, in my books, we have $65 billion reasons why their fiscal policy was beneficial.
You are correct that steps taken by the gov't got us out of debt, particularly the legislated debt-repayment schedule...however spending is now being financed by non-renewable resource revenues.
SH
"spending is now being financed by non-renewable resource revenues."
But is it really though? What about all the one-time spending, specifically to infrastructure? Is building a highway a waste of non-renewable resource revenues?
Or how about the fact that the Gov't of Alberta actually takes in more from Gaming than they do from Oil royalties?
I understand that once the Oil is gone it is gone forever, but Alberta will have oil reserves for longer than the World economy will want/need oil.
Alberta is the fastest growing province in the Country, we have as many people move here on a yearly basis as the City of Red Deer. So, tell me what it would cost to build a city the size of Red Deer, and I will show you how that spending is needed.
Alberta's population has increased by 9% over the last 10 years, yet spending has increased by 40%.
Own-source revenues (less resource revenues) have only grown by 57% over the last decade, spending has increased by 121%.
So how are we able to pay for this 121% increase in spending if our tax revenues have only increased by 57%? Well three ways, we are now saving $1.5 billion in debt servicing costs, federal transfers have slightly increased, oh right, and we have greatly ramped up how much of our resource revenues we spend on core programs, from $3.5 billion in 2003 to $5.3 billion in 2006.
And that doesn't even include the at billions from resource revenues that make up our so-called "surplus", that are then funneled into the Capital Account to pay for infrastructure projects.
Furthermore, other than repair, there is no-such thing as a one-time infrastructure project. Every hospital, extended-care facility and school we build, we then have to staff, heat and keep open...those are on-going costs.
SH
"there is no-such thing as a one-time infrastructure project. Every hospital, extended-care facility and school we build, we then have to staff, heat and keep open...those are on-going costs."
Yes, they are ongoing costs, but if a hospital costs $25 million to build (estimated), and then costs $10 million a year to operate, you still do not have to pay that $25 million every single year, so in effect, it is a one-time infrastructure cost."
It is no different than buying a new television, sure you have to pay for cable/satellite to watch the TV every month, but you don't have to ever pay for that TV again, so I would consider that a one-time cost.
But it's still an additional cost that you weren't having to pay before.
To Aizlynne,
there is no such thing as a "total picture" in politics. How can something be a total picture? Does that mean taking the good with the bad? Is it not possible to merely highlight the good and be grateful that our "bads" aren't nearly as bad as they could be?
Infrastructure spending is different than operating costs, sure it adds to them, but it is a needed cost to add to the Budget. Infrastructure is one-time, no doubt.
Look, chanandler is right. The fact that it has developed the oil and gas industry is a feat of government policy. You want evidence? Look at a map of oil and gas development in western canada. It shows how oil and gas basically stops at the border between alberta and saskatchewan. The oil sand developments? A really good royalty regime, otherwise, it's syncrude and suncor and not the 25 other companies that are looking around.
It's not a fluke.
Infrastructure deficit? Look at the absurd levels of government spending dedicated to infrastructure since the late 1990s. The "infrastructure deficit" is a myth created by Alberta cabinet ministers.
Sure if you want to get into semantics, the actual building of the school is a one-time cost. But if you can't staff, heat or open the school, why did you just build it?
Chanandler, if you like the logic of using one-time dollars to buy things that have on-going costs, I imagine it must be strange living in an appartment that has a TV you can't watch, a hot tub full of stale cold water and a bird that you can't feed any more.
It'll be a lot like the province if resource prices drop. Schools sold off to service clubs, hospitals blown up and a lot of out of work people who were once employed by the gov't using resource revenues.
Sounds like as much fun as being your roommate.
SH
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