Despite Opposition demands, Alberta NDP says no to risky conservative ideological experiments in its 2017 budget

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PHOTOS: Finance Minister Joe Ceci. Below: Interim Progressive Conservative Ric McIver showing off his Three Stooges tie, the sale of which puts the gross in Gross National Product; Opposition Leader Brian Jean; and Alberta Liberal interim Leader David Swann.

“Admit it, Alberta, after yesterday afternoon’s Budget Speech was read by Finance Minister Joe Ceci, you were secretly relieved.”

I first wrote those words not quite a year ago – on April 15, 2016 – when Mr. Ceci got up on his hind legs in the Legislature and read the first NDP budget written by the first truly new Alberta government in more than four decades.

Here we are one year later, and little has changed. This is a good thing.

On the occasion of its third full budget, the New Democratic Party Government of Premier Rachel Notley continues to deal with a difficult financial situation caused by low oil prices and a one-note economy left by 43 years of Conservative mismanagement by not attacking health care and education, by not declaring war on public employees, and by not engaging in risky ideological market-fundamentalist experiments that, whenever they’ve been tried, don’t work.

That’s a dramatic change from what conservative governments instinctively do and what conservative oppositions habitually demand.

As a result, this year’s deficit is expected to be $10.3 billion. That is down about $500 million from last year’s budget deficit. But, Mr. Ceci pledged yesterday, again, “we’re not going to make drastic cuts to the things that would only hurt Albertans to get to balance more quickly.”

Instead, they NDP Government has taken advantage of low interest rates to keep people working building things we actually need as the province’s principal industry edges back toward better days – which it seems to be doing.

In addition to not gutting health care, education and other front-line public services, this approach includes building 24 new or significantly upgraded schools, a new public hospital for Edmonton’s under-served south side, a court house in Red Deer and 200 public long-term care beds in Calgary for seniors with complex needs and another 145 in Edmonton. Those 345 beds are part of a planned build of 2,000 LTC beds across the province.

Operational costs will be kept within an envelope the same as the forecast combination of inflation and population growth in the 2017-18 fiscal year.

The downside, if it really is a downside, is the amount of debt the government in incurring to avoid raising taxes. The province’s debt is predicted to rise to $45 billion in the next fiscal year. The Royal Bank’s reliable fiscal tables indicate Alberta’s debt-to-GDP ratio will be 3.1 per cent at the start of next month, rising to 7.1 per cent by April 1, 2018.

This, according to yesterday’s overheated Opposition rhetoric, is pretty much hell on wheels – especially when the TV cameras were turned their way, and there were plenty of video cameras in the Legislative Building’s Rotunda yesterday.

Brian Jean, the Opposition Leader, called it a “debt-fuelled disaster.”

“This budget threatens to send us over the fiscal cliff with higher spending, higher taxes and a plan that plunges Alberta, believe it or not, into $71 billion of debt by the time the NDP face voters in 2019,” Mr. Jean hyperventilated. (To give Mr. Jean his due, he sounded pretty reasonable when he said he wouldn’t lay off any front-line workers if he were running the show.)

Ric McIver, the interim leader of the Progressive Conservative Party for another 48 hours or so, bemoaned the same stuff. “Alberta’s children, 20 and 30 years from now, will be paying for things that they don’t get to enjoy, which is why I call this a huge intergenerational transfer of wealth,” he huffed, wearing a spectacularly ugly Three Stooges tie that he said symbolized the way the NDP is running things. (Others might draw a different conclusion.)

Even Alberta Liberal interim Leader David Swann, who always seems to me like a New Democrat at heart, said much the same thing, although without much conviction.

Well, that’s their story, and they’re all stickin’ to it. Perhaps they actually long for the days of Ralph Klein, when Alberta was the poorest little richest place on earth, lurching from cash giveaways to brutal austerity, while leaving a huge infrastructure deficit for a future generation to pay.

But how bad a thing is this level of debt, really? There’s lots of room for reasonable disagreement about this, of course, but it’s interesting to note that between 2007 and 2012, public debt in the world’s rich countries grew from an average of 53 per cent of GDP to close to 80 per cent.

A debt-to-GDP ratio of 60 per cent is often said to a reasonably prudent upper limit for developed countries – Canada’s is around 66 per cent and the United States’ is well over 100 per cent. Quebec, which like Alberta is not a sovereign country with its own currency, has a debt-to-GDP ratio around 50 per cent and there’s no sign le ciel is about to tomber.

So, is 7 per cent too high? Probably. Mr. Ceci certainly thinks it is. Does it justify the Opposition’s rhetoric? It does not.

No political party – including the one that will soon be led by former Harper Cabinet minister Jason Kenney, who with his PC leadership campaign in its last hours didn’t take advantage of all the cameras in Edmonton – could have come close to balancing this budget at present tax rates without doing grave harm to Alberta and its people.

That is why, presumably, the sense of relief was almost palpable in the halls of the Legislature again yesterday.

Even the Chicken Littles of the Opposition secretly liked Mr. Ceci’s budget, I suspect, because it lets them loudly proclaim their quasi-religious market fundamentalist faith that, sooner or later, if we don’t do what they demand, the god of the Market will be angry, and the sky truly will fall.

They should ask themselves WWBWD … that is, What Would Brad Wall Do? The answer, as a matter of fact, is right on page 99 of the 2017 Alberta Budget Fiscal Plan, handed out in the pre-budget lockup yesterday afternoon.

Presumably Saskatchewan’s conservative premier, viewed by Alberta conservatives as having messiah-like qualities, would make us pay $9 billion more in taxes, to get us up to the rate he collects from Saskatchewanians.

Not the Alberta NDP, though.

NOTE: This post has been amended to replace misleading information from a mainstream media organization with more accurate information from the Royal Bank’s financial tables, which also happen to be significantly more favourable to the government. The post also appears on Rabble.ca.

Categories Alberta Politics