Alberta Budget: We are all going direct to heaven … or not

The Alberta Budget Speech – sitting of Legislature may not be exactly as illustrated. Below: Lloyd Snelgrove, who also is not be exactly as illustrated. This picture was snapped the week he unwisely had his trademark goatee off.

Today was Budget Day at the Legislature: “…it was the epoch of belief, it was the epoch of incredulity … we were all going direct to Heaven, we were all going direct the other way.” You get the general idea.

Budget speeches may lack brass bands, artillery salutes and the bemedalled presence of the Lieutenant-Governor, but, no less than the opening of the Legislature two days before, an Alberta Budget Speech is pure Kabuki theatre – everybody has a role to play, and everybody plays it pretty much the same way.

Some roles are silent: Progressive Conservative Premier Ed Stelmach said nothing. Some are not: Former finance minister Ted Morton, the fiscal hawk whose rebellion prompted the premier’s Jan. 25 decision to throw in the towel, setting off the leadership race that is the backdrop to this budget, made an effort to set himself apart from the government.

Newly appointed Finance Minister Lloyd Snelgrove told us everything is great. The opposition and their supporting chorus of think tanks, federations, boards, agencies, municipalities, institutes, unions, lobbyists and industrial associations told us, for the most part, that everything isn’t. Some politicians cracked wise, because that’s something journalists remember. (“The capital budget is Ed Stelmach’s bucket list,” said NDP Leader Brian Mason.)

The media wrote down what everybody said and put it in the paper. Now everybody holds their breath and waits to see how Martha and Henry will react, which arguably is the story that really matters.

Alas, for Martha and Henry – and that would be you and me, m’dear – it’s very hard to figure out what the heck is going on. Most of us have trouble finding our way through a $40 mobile phone bill. How are we to make sense of a $40-billion budget, especially when everyone is telling us something different and all the numbers don’t seem to add up? So we make a snap judgment based on our political prejudices, economic instincts, hopes, fears … and perhaps a dollop of self-interest.

If you want to read the details of today’s Alberta budget, the Edmonton Journal did an excellent job of covering it. You can find their main story here.

If you want the Alberta Diary executive summary, here it is, in four-part harmony:

  1. Government says: The budget maintains its “commitment to preserving priority programs and investing in infrastructure, while holding the line on spending.”
  2. Opposition (Right) says: The government “is practically vaporizing our savings accounts. You can’t just keep on hoping that revenue increases are going to bail you out of this problem.” (The quote belongs to Wildrose Alliance Leader Danielle Smith.)
  3. Opposition (Left) says: The government doesn’t have a spending problem, it has a revenue problem. “They’ve given tremendous gifts to their friends in the oil and gas industry, letting them take most of the value of the resources that belong to the people of this province. They have continued to charge the lowest royalties in the world.” (The quote belongs to Mr. Mason.)
  4. The media concludes: “Alberta plunges deep into the red; $3.4-bllion deficit expected in fiscal 2011-12.”

Oddly enough, they’re all right. Premier Stelmach’s Conservative government has done the seemingly impossible and maintained the appearance at least of preserving programs that are popular with voters while not increasing spending. They’re sincere in their belief in Alberta’s future, but they’re also praying for petroleum prices high enough to sustain the gamble. Lots of experts on both sides think their estimates are way too optimistic. But they reckon if they can make the books look like they’ll soon be back in the black, they can get re-elected.

To do this, they are ripping through the Sustainability Fund. Once it’s gone, pretty much at the end of this budget cycle, it’s big spending cuts or big tax increases unless royalties increase.

Likewise, they do have a revenue problem. If they raised taxes to the same level as the next lowest-tax province, they’d collect another $10 billion according to one number cruncher at the scene of the crime. If they’d raise royalties modestly and make an effort to collect what we’re owed, they’d collect billions more.

And, yeah, there’s going to be another deficit.

So the real question – and probably the only one that really matters at the end of the proverbial day – is what Martha and Henry think.

Without some scientific polling, it’s hard to know for sure, but here’s this blogger’s guess:

  • They’re relieved that there won’t be painful cuts in a rich province.
  • They hope that with all the troubles abroad, oil prices will rise and the Alberta economy will boom again.
  • They’re not too worried about a deficit – yet.
  • It bugs them when the far right wants to cut everything.
  • It bugs them when the left talks tax increases – even sensible ones like fair royalties.
  • They’re willing to wait to see if things work out as the government predicts.

In other words, if this is right, the Conservative roll of the dice today came up lucky.

If true, it’s more evidence bench strength and experience remain significant assets for the party that’s ruled Alberta for 40 years.

The opposition of the right and left made their points with vigour and eloquence this afternoon – and they sincerely believe their arguments. But one still couldn’t shake the sense they were just going through the motions.

The last few months have been a difficult season for the Conservatives. At the end of last year, they appeared headed for the rocks. But Mr. Stelmach’s announcement he will quit has changed a lot. Today seemed like a pretty good day for them.

This post also appears on rabble.ca.

3 Comments on "Alberta Budget: We are all going direct to heaven … or not"

  1. Berry Farmer says:

    Good one, David!

  2. Anonymous says:

    Dave,

    Great article, as usual. One thing the unions have to start doing better is start looking after democracy itself, not just contracts with the public sector. In the U.S., the RW politicians are trying to make collective bargaining unlawlful, this actually an attack on human rights. There should also be a stronger demand for better retention of royalties. Currently, we handle the oil boyz with kid gloves, while Sweden enjoys a $500B heritage trust fund. We really have no excuse. There is a huge money hole in Albertan's wallet. The Unions really should expand their political interest to the royalties as well, if they want the support of the public and sympathy during bargaining. Otherwise, they will remain under attack and always be viewed by the RW as opportunists looking after their own cash. Its time the Unions become defenders of human rights. The oil wealth we have equates to a human right. I think I have made the point here.

  3. Shamanthi says:

    Actually, Unions are requesting an increase in oil revenues rather than increasing the deficit or cutting public services. Here's a recent media release that is being circulated!

    http://www.youtube.com/watch?v=ZmKiJ7zAOsk&sns=fb

    AUPE is also sending members to Wisconsin to fight against that anti-worker bill. I agree that it is a violation of Human Rights and it is clearly not Democratic. I was impressed that AUPE has taken this step.

    As public service workers providing services to the general public, we need support from Albertans to protect those very services that are either abolished privatized or cut in funding. We all know that privatization does not mean better, faster and cheaper. Parkland Institute has proven that through their research and are continuing to do more in this area.

    We cannot continue to provide quality services with little resources, lack of manpower and working longer hours, sometimes without pay just to keep up. It is effecting the quality of our services, the worker's mental and physical health and ultimately it increases the disparity further between those that have and those that have not. It is definitely not productive for economic growth. Who will want to live in Alberta when there are no resources, increased poverty, more crime, more homelessness, more illness and the general quality of life is low for the majority?

    What we need is not sympathy during bargaining, we need solutions. :) We need understanding from the public that the work we do is important. They value the working men and women in this province and that they value it enough to keep those services public and address the workload issue. We are the citizens of Alberta, we have a strong voice and we are the contributing members of society. We contribute to this economy and we are entitled!

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