In January, as the Globe and Mail put it in a colourful old-timey headline last week, Canada’s job market blew past the forecasts for the month. Unemployment also fell.
In Alberta, not so much.
Indeed, Alberta was the only province in Canada to see jobs disappearing — and in significant numbers, with 19,000 lost in January, the second month of the past three the province has experienced big job losses.
Canada, meanwhile, added 34,000 jobs nationwide in January, Statistics Canada said, which was pretty good considering the expectation the country would be up only 17,500 jobs by the end of the month. Unemployment nationwide edged downward to 5.5 per cent — not a record low, but within shouting distance.
In Alberta, by contrast, unemployment is now at 7.3 per cent, similar to the rates being experienced in the Maritimes — that part of Canada former Calgary MP Stephen Harper in the days he was leader of the Canadian Alliance Party famously and arrogantly dismissed as having a “culture of defeatism.”
It’s even worse in Edmonton, Alberta’s capital city, where unemployment has soared to 8.2 per cent, the second worst record of any major city in Canada, a hair behind Windsor, Ont., where the rate is 8.3 per cent.
Even the other Prairie Provinces, which share economic conditions with Alberta, saw their job numbers increase last month. Indeed, Manitoba had its largest overall employment increase since April 2008.
It wasn’t supposed to be like this!
So it’s worth asking what’s going on — especially in light of the economic claims made by United Conservative Party Premier Jason Kenney during last year’s election campaign that he, and he alone, possessed the answers to the economic downturn that affected Alberta after international oil prices tumbled in 2014 just in time for the unexpected election of the Alberta NDP.
Mr. Kenney’s formula, which Albertans bought into with enthusiasm: Big tax cuts for corporations, an end to the NDP’s carbon tax, spending austerity, attacks on trade unions, and the usual package of neoliberal economic nostrums.
After he handily defeated Rachel Notley’s NDP in April, Mr. Kenney moved quickly to enact his program. He dumped the “job killing” carbon tax as his first act. He quickly enacted a $4.7-billion “job creating” corporate tax cut.
It’s widely understood nowadays that the alleged effectiveness of such tax cutting measures is mostly hooey.
As Nobel Prize-winning economist Paul Krugman puts it (I’m paraphrasing and parenthesizing just a little to eliminate obvious Americanisms), conservative “faith in the magic of tax cuts — and, correspondingly, belief that tax increases will doom the economy — is the ultimate policy zombie, a view that should have been killed by evidence decades ago but keeps shambling along, eating (conservative) brains.”
The record in the U.S. is consistent, Dr. Krugman points out in one of his many New York Times columns on this topic. Tax increases don’t cause job losses, and tax cuts don’t create them.
That’s true no matter how many times Mr. Kenney and his army of taxpayer-financed Twitter trolls say the opposite. The loss of something like 70,000 jobs in Alberta since the UCP came to power should strongly suggest that this isn’t the way things work.
Mr. Kenney, of course, has a litany of complaints and a host of suspects to blame for the economic problems Alberta is experiencing under the UCP’s ideological rule.
European Greens, the Rockefeller Family, Liberal Prime Minister Justin Trudeau and now even former U.S. President Barack Obama are believed by UCP supporters to have been conspiring against Alberta. Mr. Trudeau in particular winds them up — astonishing given the hard work he put into supporting Alberta’s pipeline agenda during both Ms. Notley’s and Mr. Kenney’s tenure as premier.
And talk about faith in magic! The idea pipelines are supposed to make Alberta’s economy boom is based on the risible notion that increasing the worldwide supply of Alberta bitumen will somehow cause the price of the stuff to rise! Sad to say, not only the UCP bought into this codswallop.
But even Marxist economists will tell you the law of supply and demand is an inflexible one. So the likely outcome of Alberta’s desired hydrocarbon pipeline spree, if it occurs, is both lower prices and a worsening planetary climate.
Putting that aside for the moment, even the International Monetary Fund has abandoned the belief spending austerity of the sort reflexively advocated and now being put in to practice by the UCP does any good. And in case you missed it, the folks at the IMF are not exactly communists!
Way back in 2012, the IMF admitted after years of saying otherwise that using spending cuts to shrink deficits causes economic damage, and more of it than economists has blithely assumed till then.
None of this seems to matter to Mr. Kenney and company. Perhaps this is because worrying about debt and deficits makes a kind of superficial sense in a society where the notion that thrift is a virtue is bred in the bone. Perhaps it’s because they have another agenda to benefit wealthy backers who put their own interests before those of society. Perhaps it’s because blaming outsiders for your troubles has been an effective way for bad leaders to stay in power all through human history.
One thing we do know, and that’s that the simplest explanation for anything is usually the right one.
And the simplest explanation for Alberta’s job losses at a time when the rest of the country is piling on new jobs has something to do with the fact we’ve elected the most extreme and ideological market-fundamentalist regime in Canada and its policies don’t work any better here than they do elsewhere.
The simplest explanation for the particularly bad employment situation in Edmonton is that Mr. Kenney’s revenge agenda against the Albertans who elected an NDP government in 2015 is directed at public employees, many of whom are naturally found in the capital city, and voters in the only part of the province that held true to the NDP.
So the reasonable expectation is that two things will happen if Mr. Kenney and the UCP stay the course:
- Job losses in Alberta will continue and get worse
- Scapegoating, conspiracy theories and victim blaming that have already characterized this government will intensify as the economy crumbles
Finance Minister Travis Toews will table a provincial budget on Feb. 27, the government announced yesterday.
Given their actions to date, and the rationale given for them, it is not as reassuring as it should be to hear Mr. Toews say, “I have listened to the comments that thousands of Albertans have shared with me and I hear your concerns about the need to continue to create jobs and grow the economy.”