January 23rd, 2021

Reckoning or wrecking? The UCP and Alberta’s economy

By Lethbridge Herald Opinon on September 9, 2020.

Trevor W. Harrison

University of Lethbridge

Echoing Biblical prophecy, Premier Jason Kenney has repeatedly said Alberta is headed for a “fiscal reckoning.” Finance Minister Travis Toews’ recent grim account of Alberta’s financial plight – a deficit of $24.2 billion and a provincial debt climbing to $99.6 billion – sets the stage for the UCP’s budgetary punishment this fall.

Whether the fall budget will see an honest reckoning or merely a further wrecking of the Alberta economy remains to be seen, but the signs are not hopeful. According to Toews, until the dastardly Covid-19 virus came along, Alberta’s economy was humming towards a return to pre-2015 prosperity; i.e., the time before the NDP were elected. It’s a comforting story for the government.

But facts are stubborn things and, in this case, they don’t support the government’s narrative. True, COVID-19 has negatively impacted Alberta’s economy. A lot of businesses have been permanently shuttered and unemployment has skyrocketed, from 7.2 per cent at the end of February to 15.5 per cent in the spring and around 12 per cent today.

But Alberta’s unemployment rate was already increasing before the pandemic struck. In fact, job growth during the UCP’s first year in office was the lowest (at .5 per cent) since the economy collapsed in 2015-2017. More generally, Alberta’s energy sector is still sputtering: non-renewable resource revenues are down $3.9 billion. No amount of mythologizing, or blame-seeking, will rescue the energy sector from the long-term effects of world over-supply, shifting consumer demand and technological changes.

Like a general fighting the last war, Toews valiantly repeated over and over the UCP’s battle strategy from 2019. The government’s plan follows the same failed formula: cut essential public services, privatize, give corporate tax breaks and subsidies, and make targeted investments in infrastructure.

With a couple of exceptions, the assembled media appeared unimpressed. Toews’ own numbers showed that, in his words, “the increase in the deficit is all attributable to a decline in revenue.” Yet, in the face of this admission, he steadfastly refused to address the issue of revenue reform. At one point, a skeptical journalist turned on its head Toews’ repeated (and erroneous) assertion that per-capita public spending in Alberta makes it an “outlier” to comparable Canadian provinces. He asked Toews whether, in fact, the government might consider measures to raise revenues, given that Alberta is a conspicuous “outlier” on revenue generation. (The Alberta Treasury notes the province would have over $14 billion more in revenues were it to tax at the level of the next highest taxing province, Ontario.) Toews opined only that it might be an “important discussion for future.”

Trapped by ideology, the UCP government’s vision for Alberta remains narrowly focused on the oil sector and construction industries. As important as these sectors are, Alberta’s economic future relies on a coherent and comprehensive strategy that includes all sectors, workers, families and communities.

The paucity of the UCP’s approach to Alberta’s economy comes into sharp relief if one examines its failure to recognize the economic role of women and the specific hardships visited by the pandemic upon female-dominant sectors of employment. >In the midst of the 2015 oil price crash, female front-line workers in health care, education, public service and hospitality/retail services kept Alberta’s economic engine from stalling, and kept many households afloat as their partners or family members faced job losses in the oil and gas industry.

These same sectors are now struggling, but the Kenney government has offered women little, save the promise of future wage cuts and layoffs. Several economists argue that Alberta’s economy cannot be rebuilt absent affordable, accessible child care. Without this, women are unable to re-enter – or remain – in the workforce; they cannot indefinitely juggle their caring responsibilities with the demands of paid work.

This is only one example. There are other policy approaches the government could implement that would support the people of Alberta through this difficult time. To date, however, the UCP’s focus remains more punitive than helpful, more ideological than practical. Unless Albertans demand a commitment to an economy and policies that support all people, Alberta’s future will be the wreckage of what might have been.

Trevor W. Harrison is a political sociologist at the University of Lethbridge and director of Parkland Institute.

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Southern Albertan

Reckoning or wrecking? Maybe both. It is heartening to see, and hear, folks who did vote for the UCP starting to say, “I never voted for that…..and, I won’t vote for them again.”
Again, it is astounding that the Kenney UCP is not addressing other avenues of revenue, and still, hoping beyond hope, that there will be oil and gas booms again. With regard to their ‘diversification’ talk, some of our longer memories remember how the AB NDP were well on the way to ‘diversification’ already. And, monies that were being turned back into the economy were from the carbon tax, as opposed to a provincial sales tax. We didn’t notice any difference then, in our fuel costs. And yes, we need fair taxation, desperately. There is still, a lot of ‘money’ in Alberta which is fine, but obviously, there is the affordability to pay a bit more tax, as well. This is judging by the number of high end vehicles on the road, RVs, ATVs and all of the other ‘toys,’ new houses, $millions in state of the art farm equipment…….it is out there for all to see.
And yes, for women, many in my frontlne health care profession, and when their partners/families were suffering from the downturn in the oil and gas sector, came back to work. And the work is not necessarily easy, and frequently, exhausting. And now the Kenney UCP is supposedly going to ding health care professions? A real slap in the face for these folks.
It honestly begs the question: How much ‘wrecking’ will it take for more Alberta folks to rejig their political belief systems when they hopefully, come to certain realizations? And what is really annoying, it that the Kenney UCP are masters at trying to lay the blame for their ‘wrecking’ on everyone and everywhere, but, themselves. Some of us are not fooled.


Give your head a shake…. The NDP got us into this mess!
When you are given a broken economy what would you expect… So easy to forget the chaos of the NDP!

Southern Albertan

Remember, global oil prices crashed in 2014 already when the AB NDP won the election, Alberta was in recession and the right time to do deficit budgeting is during recessions, not, austerity budgeting. Some memories are long….Alberta had 40 + years of financial bungling by AB Conservative rule. They did not follow Premier Peter Lougheed’s ‘Six Principles’ for resource development: “Behave like an owner, Collect your fair share, Save for a rainy day, Add value, Go slow, and Practice statecraft.” Now, we’re paying the piper because there will be no more booms, and again, the Kenney UCP is not addressing other avenues of revenue.


Did the NDP do deficit budgeting?

Southern Albertan

Yes, thus, all the complaining about the NDP deficit. Now, Alberta is in recession and the Kenney UCP is doing austerity, possibly at our peril, particularly while not, again, addressing other avenues of revenue. If thousands of more jobs are lost due to their austerity/cutbacks, it could drive Alberta further into recession yet. Time will certainly tell, but it’s not looking good.


we were already well in the tank when the ndp got in. what we had prior to the ndp were con govts. therefore, only an idiot mind would believe that the ndp got us into this mess. so, now we have con again. what are they doing? giving away money to oil cos, with no jobs coming, threatening our watershed with a backward deal to mine coal…and the are spending money faster and lining pockets far more than did the ndp. what is next, great minds, but to blame covid and to blame covid on the ndp?