The Notley government in Alberta took office facing severe fiscal challenges. Unfortunately, this week’s fiscal update from Alberta Finance Minister Joe Ceci shows that the new government’s early actions have made a bad fiscal situation worse.
alberta government
Rachel Notley’s New Democratic government faces severe fiscal challenges it did not create, but it has an opportunity to solve them. Will her NDP government clean up the fiscal mess left behind by its Progressive Conservative predecessor?
In its recent Speech from the Throne, the new Alberta government reiterated its plans to make life more expensive in Alberta.
Alberta’s economy is still on shaky ground as oil prices remain depressed relative to last year’s levels.
In a famous explanation of why voters choose the governments they do, a 1990s-era adviser to Bill Clinton remarked, “It’s the economy, stupid.” That’s not wholly accurate; voters toss parties out (and vote parties in) on matters other than unemployment rates and incomes. The recent Alberta election is only the most obvious example.
Once the euphoria of the Alberta NDP’s historic election victory subsides, Premier-elect Notley and her leadership team will have to make a fundamental decision about the fiscal-policy path the new government will pursue. This decision will shape the immediate and future prosperity of Albertans.
With the price of oil plunging to below $50 per barrel and the outlook for Alberta’s economy and provincial budget revenues falling in tandem, an oft-heard piece of advice is being recycled: Alberta should diversify its economy.
Albertas provincial government has provided plenty of political theatre as of late, with, as I write, three resignations from the government, including that of Alison Redford as premier. However, the Redford resignation may not be the end of her influence on Albertas future, and in particular, upon the Alberta Heritage Savings and Trust Fund.
When apologists for the provincial government's new borrowing binge defend it on the grounds that private sector companies borrow money for capital expenses so why not have the Alberta government do the same? their defence invariably contains a significant and faulty assumption: that political behaviour is the same as that of private companies.