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May 02 2015

The NDP will destroy Alberta’s economy

All the recent polls in the Alberta election seem to indicate that the NDP (i.e. socialists) under Rachel Notley will form the next government of our fine province.  Ms. Notley has vowed to fix the regulatory environment for the oilsands, to withdraw funding from “independent” schools, to spend more on infrastructure, roll back cuts to health care and education and raising the minimum wage to $15.  This all sounds good, except:

  • The planned regulatory re-evaluation will consist of “science-based” rules that will make “environmentally acceptable development” impossible because no one will be able to afford the level of investment her “scientists” will come up with to protect the environment.  It will be an impossible task.
  • The planned regulatory re-evaluation will consist of demanding local upgrading and refining, which is uneconomic when there is excess capacity in the rest of North America.  the NDP also do not understand that pipeline crude oil is easy.  Pipelining final refined products is hard because you have to ensure no contamination.  This probably means more pipelines, not less.  Government demands to couple upgrading to production will mean reduced investment in production because no one will want to waste money on upgraders when they can drill shale oil wells in the USA or Saskatchewan, or drill offshore Africa.
  • Withdrawing funding from independent schools means no more charter schools and no more government money for private schools.  Tuition at private schools will skyrocket, reducing the number of people who choose to go that route.  It will force people back into the public system, which has been declining in quality for years because the Alberta Teachers Association, friends of the NDP, think teacher’s pensions and benefits are more important than educational outcomes.
  • Spending more on infrastructure sounds good, until you realize that Ms. Notley plans to continue the PC’s method of not counting capital expenditures in the annual budget deficit, but still adding it to the debt.  They will increase Alberta’s debt by $31 Billion by 2018, all while claiming they will “balance the books”.
  • Rolling back cuts to health care and education, and other public servants is foolishness because Alberta already spends far more per capita for the public service than any other province.  We need to CUT SPENDING and CUT THE NUMBER of public servants.  We need REAL wealth creators, which is business, not government.
  • Raising the minimum wage by 50% means the businesses that employ such low-cost and low-value added staff will need to reduce staff by 33%.  If a worker cannot provide in excess of the minimum wage in equivalent value for that work, they will not be employed.   Alternatively, businesses will need to raise prices for their goods and services to cover this extra cost.  This means everyone who buys goods and services in Alberta will be poorer, and those who are suddenly making 50% more will not be better off at all, and a third of them will make nothing because they will be unemployed.

The attraction of the NDP is that they promise the impossible – money for nothing.  They will spend without understanding money comes from economic development and that the state is a leach on the economy.  Part of me is shocked that Albertans are foolish enough to vote NDP.  Having watched the NDP run the economies of BC, Saskatchewan, Manitoba and Ontario in the ground over the last 40 years, I can’t imagine why anyone thinks the NDP are competent enough to run a government.   Perhaps it is because Albertan’s have been insulated from that – except I know that many such Albertans came to this great province to ESCAPE the ravages of the NDP in those other jurisdictions.   Perhaps Albertan’s need to know the pain of NDP government to understand what a disaster it will really be.

A few years ago, the Saskatchewan Party under Brad Wall correctly labelled the NDP and their platform in an election “The Job Killing Machine”.  That is exactly what the NDP will be in Alberta.  Saskatchewan should prepare for an influx of economic refugees and an dramatic increase in oil industry spending in your province.  The tables are about to be turned in your favour.

To the Albertan’s who think voting NDP will be good for them, remember the wisdom of Frederic Bastiat, some 165 years ago:

The State is the great fiction through which everyone endeavours to live at the expense of everyone else.

and

Legal plunder can be committed in an infinite number of ways. Thus we have an infinite number of plans for organizing it: tariffs, protection, benefits, subsidies, encouragements, progressive taxation, public schools, guaranteed jobs, guaranteed profits, minimum wages, a right to relief, a right to the tools of labor, free credit, and so on, and so on. All these plans as a whole — with their common aim of legal plunder — constitute socialism.

Prepare to be plundered by the government of Alberta.

14 comments

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  1. monkey

    Fully concur here, although I think not just in Alberta but in Canada in general we too many are drinking the left’s kool aid and its time to fight back. I could see by 2012 shortly after Occupy Wall Street and all the media attention on income inequality the left was beginning to gain traction and disappointed the right didn’t fight back. Many Canadians say the rich aren’t paying their fair share, corporations aren’t paying their fair share, Nordic Countries are proof socialism works, we are in a recession so government needs to spend more to stimulate the economy, and if wealth was more distributed we would have a fairer society. Off course the one problem is once you give the actual facts they all full apart. Otherwise the society many on the left envision doesn’t exist anywhere on planet earth. Maybe on some other planet in some other universe, but not here it does. Our taxes are extremely progressive whereby the top 1% pay 20% of taxes, top 10% pay 50% and the bottom 50% only pay 4%. Canada not only has the highest median income ever, it has one of the highest anywhere in the world and if Alberta were its own country it would probably be the highest. Our corporate taxes while lower than the US are above the OECD average and higher than 4 of 5 Nordic Countries. Nordic Countries are doing well because they have centre-right not centre-left governments. And for those who say their right is like are left, that’s not true. Their right may be to the left of the federal Conservatives or WRP, but still to the right of the Alberta NDP. They range from Chretien/Martin Liberals to Mulroney Tories. We have 2% economic growth which is normal growth so if following Keynesian economics, stimulus would be incredibly stupid. Re-distribution wealth would make the rich less rich, but it wouldn’t make the middle class or poor better off as it would just drive away business who create wealth and rely on governments who don’t create wealth.

    I understand most Albertans feel the PCs have overstayed their welcome, but taking a sharp turn left is not the solution. And while its true the Alberta NDs are most centrist than most provincial NDP parties they are just as left wing as the Wynne Liberals which hasn’t worked out well. I would be fine had Laurence Decore won in 1993 (although I agree Klein was a very good premier) or if the Liberals had a leader similar to Quebec premier Philippe Couillard or the Chretien/Martin Liberals, but that is not what Rachel Noteley. More than anything I think many NDP voters are doing it as a protest vote as they still believe the PCs will win. In many ways this seems shades of the 1990 election in Ontario and we all know how that turned out.

  2. Wayne

    We are planning a factory that will employ from 12 – 25 people. I am a born and raised Albertan and planned to set up in the province. Looking seriously now at moving the factory to Saskatchewan of contracting the work to fabricators offshore. How is that going to help the Alberta economy as a whole, or those looking for a career in the province specifically? Why does the left not get this?

  3. Richard S.

    I am an economic refugee from BC when I moved to Alberta in the 1990’s under an NDP government there. This time Saskatchewan could benefit from the Alberta NDP win.

    1. monkey

      If the NDP wins in Alberta, BC and Saskatchewan will be the big winners as both have pro free enterprise governments never mind an NDP win in Alberta and what will follow will make it that much less likely the NDP will win in 2017 in BC. Atlantic Canada and Alberta will be the big losers as Alberta for the reason mentioned above and Atlantic Canada as they rely heavily on equalization and the pot will shrink a lot as Alberta gets poorer. It’s rather ironic that Quebec (a province we normally associate with big government socialism) is finally turning away from it while Alberta a province that has thankfully resisted this in the past is about to embrace it.

  4. Frank

    Jim Prentice spent much of the election apologizing for past PC regimes. He then promised that the government would plan for low oil prices in the business cycle. That made him and the PCs look like idiots as if they just discovered that the price of oil is volatile and cyclical. We are heading into a deficit of $7 billion in one year and 59 new taxes. The PCs are a failure and need to be held accountable for throwing away opportunity for the past 35 years.

    Frankly, I think the NDP could not be worse. All those entitled PCs need to move and disconnect from the government teat.

    1. Taliesyn

      Oh the NDP will be worse. I don’t like the PC’s either, but the NDP don’t understand economics and will drive investment away and unemployment up.

      1. monkey

        Exactly. Unfortunately I think the NDP is doing well as many fall for their feel good stories of a more fair and just society without understanding how economics actually works and that taxing the rich and corporations won’t help the poor and middle class, it will just many fewer jobs thus hurting the middle class and poor and also less not more revenue for the social programs many want. People need to be realistic on what governments can and cannot do, not fall for fantasies. If it sounds too good to be true it probably is and while I think Rachel Noteley is an honest person who genuinely believes her policies would help Alberta, evidence from other jurisdictions and simple law of economics disproves this.

  5. ed

    So true. Hate the Pcs but the NDP is insanity. Will turn Alberta into another Winnipeg/dump. Will hold my nose and vote PC, really sad at how the Wildrose ended up. I want to vote Wildrose but we need to stop NDP at this point.

  6. Condor

    Not so sure about this. If the NDP is elected they will be constrained by the realities that they face in much the same way the federal conservatives have been. Certainly Stephan Harper has not been able to do what he would have liked to have done ideologically. I think that the NDP will wake up to the reality that the Alberta economy is a mess. A mess that has been created by 40+ years of bad governance by the provincial conservatives. There is no way that they will be able to make too many deep changes.

    I think that the scare mongering is not really helpful. All I can say is that Norway (a “socialist” country) has extracted the same amount of oil as Alberta and has a sovereign wealth fund of over a $1T. Alberta can’t even manage to balance its budget.

    What would happen if there was a move to the wildrose party? Moving further to the right at this point has its own issues. A party that is fundamentally opposed to any tax increases under any circumstances will keep the economy tied to the price of oil.

    1. Taliesyn

      The NDP will NOT be contrained by realities. They weren’t when the destroyed the economies of Ontario, BC, Saskatchewan and now Manitoba. Stop pointing to Norway – it produced more oil and has fewer people sucking on the teat of government than Canada does. Remember that in Alberta much of the money didn’t stay in Alberta.

      The NDP will raise taxes, spend more, run up more debt, give the unions whatever they ask for, kill jobs with a ridiculous minimum wage and more.

      1. monkey

        Quite frankly I get sick and tired of those comparisons to Norway. How many have actually been to that country. It’s a beautiful country to visit, but not one I would want to live in. For starters the cost of living is obscenely high and there is a 25% VAT on all purchases. Not only that Norway is a country and not a member of the EU so any revenue stays in Norway, whereas you can be sure if there was that much revenue in Alberta the feds would take it. And while it is true the NDP will be constrained to some extent by Alberta’s more conservative political culture, Alberta as a landlocked province far removed from everything needs to have pro business policies to attract business. It’s not like Ontario which due to its location (great lakes within a 10 hour drive of a 100 million people, has a metropolitan area over 5 million people) will naturally attract business even if they have an anti-business government (like we do now). I would be fine with the Alberta Party if the actually were more competitive or perhaps even the Liberals if they had a Blue Liberal leader taking over, but an NDP government is not a good idea. Never mind right now if you look across the developed world, socialist governments are in the minority and where they exist they are usually part of a larger coalition that includes some centre or right wing parties to keep them in check. If the NDP wins a majority nothing will hold them in check. And besides even if Rachel Noteley is moderate, she will probably just face what Mike Harcourt faced in the 90s in BC which is be dumped by the more ideological elements in the party.

  7. MISS CONSERVATIVE

    I am 30 years old, I graduated with my teaching degree 5 years ago and to this day I am still substitute teaching, because my French skills suck and the English schools only hire who they know- it is a reality and I have seen it first hand, teaching careers are network related not education related in Alberta. If I knew how the ATA operates and how School boards operate maybe I would have upgraded and gone for the Law degree instead of the teaching degree. What has helped me financially is my parents, my strong Catholic Faith and Confidence that things will improve and just maybe 1 day I will get to teach in my own classroom, no PST, cheaper gas compared to other provinces, that’s what has kept me in Alberta. You see if your single, childless, low income your better with a conservative government then you are an NDP government because you save more on things that actually cost you- like utilities, gas, and you can offered to buy more things when you only have to deal with the 5% gst. I voted WILDROSE TODAY and it breaks my heart that the NDP will have a majority government in Alberta. Now I might as well move out to Ontario, I can sub there, on my salary I can afford to travel because tickets to warm places and Europe are at least $500 bucks cheaper from Toronto then they are from Edmonton and direct flights!!! I can also drive down to the US when the dollar gets stronger to do major shopping of clothes/electronics to avoid paying HST/PST living in Edmonton can’t exactly do that just too far from the American border. I still see the NDP doing nothing more then putting us in debt, increasing taxes, and forcing schools to be more LGBT/Transgendered friendly/more flexible abortion laws- the focus will be on these issues to avoid the reality of a fiscal/economic/housing meltdown which will happen under the NDP. The only ones that are going to benefit from the NDP government are the terrorists, people on welfare, and non-nuclear families and the nuclear family and traditional family values will be attacked, if your Pro-life or against gay marriage you will be seen as judgemental/ as not understanding. I do not believe classroom sizes will go down- most teachers on permanent contract will spend the same amount of time on a child whether they have 20 or 30 kids, it is a reality, from subbing I can tell you it is not the amount of students, but the personality/background/classroom dynamic that makes a difference. I’ll take a class of 30 nice kids over a class of 25 with 5 behavioural kids in it any day. THE NDP is just going to put Alberta more into debt. I think Albertans have actually voted a bigger evil like the NDP compared to Prentice into office. I was hoping people would switch to the Wildrose, but instead they took a swing 180 degrees to the left and they will suffer and pay for it greatly. I only see hard times coming, nothing else. Albertans are BLIND.

  8. Clim Ajagbe

    Your message is undermined when you put scientist in quotation marks for no reason.

    Your assertion that borrowing for capital expenses is a bad idea shows a lack of understanding of how financing works. Notice how most businesses do large projects in such a manner. Why is it good business sense when the private sector does it but a bad idea when the government does it?

    Unlike industry, the government can borrow at an insanely low rate, locked in for as long as 30 years. Building infrastructure now, when we are in dire need of it, makes a lot of sense. Saving up for years to build things that we sorely need now doesn’t make sense. Klein left us with a massive infrastructure deficit. It is time to catch up.

  9. terry

    Hey Ed

    The best way to have stopped the NDP was to vote WRP. You people need to start using your friggin brains. All we needed was 34% of the vote. We only needed to keep the support we had from last election. Probably about 15% of wrp voted PC, to stop the NDP, and another 15% voted NDP to prevent another PC majority.

    Did you get tricked by Nenshi, when he predicted another conservative government? We had the election in our hands Ed, until we lost the loyalty of our supporters. We could have beat the NDP at 34%, even if they still won in the popular vote. I am getting tired of the stupidy in Alberta. Don’t be tricked again Ed, PLEASE! We are slowly losing our province to socialism. We need people like you, so please stay loyal next election. We need to turn this province around soon, or we never will. Nenshi is a danger to our freedons. He pretends to be neutral during the elections, but he always has it in for the WRP. We were the real threat to the surging NDP. In am sure Nenshi was well aware of that. Nenshi is destroying our province. He does not like the the WRP.

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