Mr. Wrong: How to blow up a federal budget, Alberta-style
Call it the Alberta Disadvantage.
It’s easy to describe. Combine a desire for spending on services with a philosophical aversion to collecting enough tax revenue to pay for them, while maintaining a very narrow tax base heavily dependent upon revenue from single commodity traded at a price beyond the government’s control. Then watch it all explode.
As long as the price of oil is high, times are good in Alberta — money enough for everyone and everything, with no immediate pressure to put anything aside for the inevitable downturn. When that downturn comes, as it always does, the province whiplashes from profligate to penitent, with sharp cutbacks, higher deficits and deep uncertainty about the future.
That’s how they’ve been doing things in Alberta for a long time now. And when the whole thing crashes, it hits hard. Which makes it doubly strange to see a federal government doing the very same thing.
When federal Finance Minister Joe Oliver announced this week he would be postponing the federal 2015-16 budget until at least until April, he did so in the hopes that the price of oil will return to a level that will allow him to salvage at least some of his government’s pre-election fiscal strategy.
In doing so, Oliver signaled to the world that Canada is now Alberta writ large; federal finances are being held hostage to a single commodity traded at prices set far away. This is no accident. This is the result of a series of conscious decisions by the Harper government.
READ MORE: http://www.ipolitics.ca/2015/01/16/mr-wrong-how-to-blow-up-a-federal-budget-alberta-style/
No comments:
Post a Comment