Earlier this spring, the Redford PCs presented what was dubbed the ‘Alison in Wonderland’ budget for its pie-in-the-sky pre-election revenue projections.
Budget 2012 was little more than a multi-million dollar propaganda piece dedicated to convincing Albertans sky-high oil prices and increases in provincial revenues were going to make it possible for the government to spend record dollars on every conceivable initiative and still have enough to balance the budget while saving for the future.
They even managed to throw in unbudgeted promises of an extra $7 billion during the following election.
Fast-forward one month. Oil has slid to below $85, pipeline delays are costing the provincial treasury billions, and the world is teetering on the edge of yet another financial crisis. If these conditions hold, the PC’s budget deficit will likely triple or even quadruple and Alberta will be staring at a financial cliff not seen since Don Getty.
As leading economists and the Wildrose have repeatedly warned, competent governments do not rely on record oil prices to balance their books. Responsible governments budget modestly, and if revenues are higher than expected, they save a healthy sum while spending the rest on infrastructure needs.
The PCs have now placed us all in a precarious position. Our former $17-billion rainy day Sustainability Fund will almost certainly be gone by year’s end. Our Heritage Fund is worth less than it was when first created in 1976. Our public services can no longer be paid for with a balanced budget without the help of high oil prices. And the government has no Plan B to balance the budget should the current global economic slowdown continue.
The Wildrose has been very clear how we would solve the budget problem: by ending all taxpayer grants to private corporations.
We would prioritize infrastructure spending so schools, Highway 63 to Fort McMurray, the two large city ring roads and key health projects are put first while less critical projects are delayed.
We would limit spending increases to no more than inflation plus population growth and shrink government management through retirement. We would also stop wasteful spending like the premier’s recent decisions to increase her office personnel by more than $500,000 per year and give a breathtaking deal on legal contingency fees to the law firm of her ex-husband and chief of staff’s wife. All of this cronyism is adding up and makes balancing the budget even more difficult.
That’s what the Wildrose would do to balance the budget without raising taxes. But what about the PCs? What would they do to balance the budget?
The government has time to ridicule the Wildrose for offering suggestions and do all they can to scare folks into believing these ideas amount to a conspiracy to fire front-line workers and cut salaries, yet the only idea they have offered thus far is that they are confident oil prices will recover to record levels.
Crossing one’s fingers and praying for record returns on our resources is not a sound financial strategy – it’s playing Russian roulette with our futures and those of our children.
