The Magical Ms M and the Blue Ribbon Panel on Finances

When Jason Kenney asked former finance minister Janice MacKinnon “to conduct a deep dive into Alberta’s fiscal situation” he told her to deliver recommendations to balance the budget by 2023 and develop a plan to retire the province’s debt without considering the revenue side of the equation.   

Ms M accepted this cock-eyed mandate and worked her magic.   

There’s been a lot of talk about Ms M’s recommendations, but very little discussion about whether her data support those recommendations or indeed whether the Blue Ribbon Panel lost all credibility when she agreed to Mr Kenney’s wonky mandate in the first place.  

Ms MacKinnon

Half a budget

For a government that prides itself on being willing to use “all of the tools in its toolbox”, the fact Kenney prevented Ms M from considering the revenue side of the budgeting process confirms he was looking for a political report, not one based on economic logic.    

Ms M started by reassuring Albertans she understood the importance of revenues.  She defined a budget as a plan “outlining anticipated revenues and expenditures” and warned that to manage Alberta’s finances it would be necessary “to increase stable sources of revenue and decrease reliance on volatile non-renewable resource revenues”. 

That said, she began to spread the pixie dust.          

She selected three comparator provinces, BC, Ontario and Quebec—all of which have a provincial sales tax and higher personal income taxes than Alberta and factor them into the revenue side of their budget deliberations—and concluded Alberta had to cut $600 million in spending and radically change its approach to capital investment or face disaster.    

No one, not even Ms Notley’s NDP, disputes the idea that Alberta’s economy is facing “crisis” given its unsustainable reliance on volatile non-renewable resource revenues to balance the budget;  where we part company with Ms M and Mr Kenney is on how best to address it.

The magic rule:  cheapest is best, always  

Throughout the report Ms M’s tries to justify her recommendations with evidence but when the evidence isn’t in her favour she simply defaults to the magic rule: Alberta must match the cheapest province in the comparator group; and when Alberta is the cheapest province she sets the bar even lower by expanding the comparator group.          

Healthcare

Ms M said Alberta’s healthcare spending per capita ($5077) is higher than BC ($4267), Ontario ($4080) and Quebec ($4370).  She noted Alberta’s healthcare spending increased by 26% over the last 10 years but the rate of increase slowed to 3.2% (in line with the other provinces) under the NDP.  Ah, so the NDP’s plan to “bend the cost curve” was working.   

Ms M said one would expect higher spending to produce better health outcomes but Alberta’s “outcomes are no better and are often worse than comparable provinces.”  This is not entirely true. 

Some of Alberta’s outcomes lag the comparator provinces, but others are better (eg. general mortality rates and the treatment of kidney disease) or on par with the other provinces (eg. hospital sepsis, patient readmittance to hospital, the number of family practitioners and specialists per 100,000 and wait times). 

Alberta’s supposedly poorer health outcomes do not justify reduced spending…and it doesn’t need to because the magic rule is Alberta’s spending must be as low or lower than the rest of the comparators.   Period.   

There’s no doubt Alberta needs to improve its health outcomes (all provinces do) but Ms M provided no evidence to support her recommendation that the solution lies in more privatization and picking fights with doctors and other medical professionals over compensation.    

Education

Guess what, Alberta’s K – 12 teachers are not the highest paid in the land.  They make less than Ontario teachers, and more than BC teachers, there is no comparative information for Quebec.   

The same is true for Alberta’s spending per student and the split between program spending versus administrative spending—Alberta spends more than BC but less than Ontario and Quebec.     

Nevertheless, the magic rule dictates Alberta’s education budget be reduced to match BC with no consideration of the fact that Alberta has two education systems (public and separate) while BC only has one (public).  This is so easy when you don’t have to think about it.   

The most troubling part of Ms M’s analysis is she fails to distinguish between public and private education.  By blurring the lines, she obscures the impact of her recommendation that the funding formula move away from one based solely on enrolment to one that considers outcomes including a school’s success at delivering “strategic outcomes desired by the ministry”. 

Leaving aside the uncertainty around what “strategic outcomes” means and how it would be measured, this recommendation paves the way for private schools to get more public funding than public schools whose outcomes are impacted by fewer resources and the fact they can’t screen out higher needs students.      

With respect to post secondary institutions, Ms M found Alberta spends $$36,510 per full time student, this is more than BC ($31,299), Ontario ($21,536) and Quebec ($25, 822), and less on administration than Quebec but more than BC and Ontario. 

What’s not clear is why.  (Ms Soapbox found the bubble charts and bar graphs incredibly unhelpful).   

In any event Ms M’s recommendation is clear:  some institutional aren’t as financially viable as others and should be on the chopping block.  One suspects institutions with strong UCP supporters on their boards of governors will be just fine.  The rest are on their own.  

Public sector

This is where Ms M’s logic went right out the window.

Ms M says the government grew in size from 2014 to 2019 despite the recession and growing deficit and debt.  What’s that got to do with it?  A caring government strengthens the social safety net in tough times, it doesn’t rip it apart.  (Incidentally, the increase over those five years was small, only 5.4%).

Ms M says the government is too big, but the metric she uses (# of employees per 100,000 population) shows it’s just right.  Alberta’s public service is similar in size to BC, higher than Ontario but much lower than Quebec.  It’s in the sweet spot and arguably should be left alone…but for the magic rule, cheapest is best.           

Ms M acknowledges the unions exercised “restraint” in past years but suggests a 2.5% pay hike in 2016/17 and 0% and 0% in the next two years wasn’t enough “restraint” because union employees are well paid and get other benefits.  This ignores the fact that they did not get sky high salaries and bonuses in the good times;  if they can’t take advantage of the “boom” why should they be penalized for the “bust”?

Then Ms M does an about face and recommends the pay freeze on government non-union employees be lifted.  The only distinction between these two groups is one is unionized and the other is not.        

She wants to overhaul collective bargaining by tying pay raises to salary levels in comparator provinces. This recommendation undermines the role of unions which is to negotiate the best deal for their members here in Alberta.  Furthermore, it’s inconsistent with the practice in the private sector where compensation is based on annual surveys performed by Towers Perrin and Mercers who compare salaries and benefits across the employers’ peer group in a specific marketplace.  What an oil company’s peer group pays its engineers in Calgary sets the benchmark for Calgary, no one cares what a company pays its engineers in Ontario.     

Ms M recommends the government reduce the size of the public service by attrition (good), eliminating lower priority services and programs (let’s talk) and alternative delivery options (oh you mean privatization, we really need to talk!).   

Capital Spending

This one had poor Ms M scrambling. 

It turns out Alberta’s capital spending is low when compared to BC, Ontario and Quebec.  No problem, Ms M simply ditched the conventional way of measuring capital spending (it’s used across Canada and internationally) and replaced it with a metric that compared Alberta’s capital spending on a per capita basis with the 10-province average.  And voila, Alberta’s spending was above average for the last 20 years. 

She wants Alberta to decrease capital spending to align with the 10-province average.  Furthermore, she’s against borrowing to finance capital spending.  She wants the government to implement a long term capital plan that finances capital spending out of current revenues. 

This is contrary to David Dodge’s advice that the government should borrow to finance capital spending in times of slow growth.  He believes “attempting to maintain a balanced budget each and every year will exaggerate cyclical economic volatility and have a perverse impact on long run growth.”

So, who do we trust:  Ms M or David Dodge, the former governor of the Bank of Canada, and the national and international community?   

The magic continues

Ms M expects Alberta to increase its revenues by growing the economy.  She applauds the corporate tax cut as one way to get there.  Given the fact Alberta was already the lowest tax jurisdiction in Canada it’s questionable whether the $4.5 billion gift to corporations will make a significant difference.  However, any moves on Mr Kenney’s part that damage publicly funded and publicly delivered healthcare, education and other public services will negatively impact Alberta’s reputation for offering a good quality of life.   

And no amount of pixie dust will change that. 

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50 Responses to The Magical Ms M and the Blue Ribbon Panel on Finances

  1. Bill Fahey says:

    Thanks for this analysis. It seems like the UCP government thinks we are blind or seomthing. Is there any documentaton of what this partisan nonsense cost us?

    • Bill, that’s a very good question, by the time we “taxpayers” (to use the UCP’s favourite description of “citizens”) pay for this and the $30M war room, and the multi-million inquiry into foreign funding and god knows what else, we could have paid for $25 dollar/day daycare across the province and much more.

  2. coolxenu says:

    Thans for this analysis!

    It seems like th UCP governemnt thinks we are blind.

    Do you have any idea what this nonsense cost us? I haven’t been able to find any information on this yet.

  3. John Hulleman says:

    Your critique needs to be given as much attention ( if not more) as the actual report

    • John I really wish the economists would actually think about what the Blue Ribbon came up with. Some say it’s got to be OK because KPMG vetted the numbers. So what, I’ve worked with accountants and accounting firms all my life. The accountants give you numbers, the CEOs decide how to use them. Let’s not forget the accounting firm Arthur Andersen was one of the “Big Five” accounting firms and one of the world’s largest multinational companies until it blew up in 2002 after the Enron mess. By the way it reorganized and continues to operate as Accenture.

  4. Carlos Beca says:

    This is just the most obvious example of what has brought neo-liberalism to its knees and has weakened democracy to its lowest levels in the free world – propaganda and treating citizens like idiots. Unfortunately it has worked because most ‘consumers’ are very uneducated in the basics of their own political system. Drunk on greed and brutal individualism the non-existing society found itself poorer that 30 years ago when the whole party of enriching the elite classes started. The most successful political sting ever created is now against the wall but still using the same tricks.
    Just think of it – a financial report without the revenue side. Mackinnon, being a good neo-liberal of course found a way to get a few dollars probably equivalent to what many make in 10 years of work. So much for efficiency and controlling spending. All of this circus because Jason Kenney does not have the balls to say that he is giving Corporations and friends 4 billion dollars and that he is going to get that money by cutting our programs. He is not even showing up for the announcements with the Blue panel because he does not want to dirty is hands and his name in case Scheers goes down in the next election and an opportunity in the Federal Conservatives comes up, after all being prime minister is still the the Grand Slam in politics. He showed clearly how he won provincially by having all his closer collaborators fined by elections Alberta.
    This is an insult to our intelligence and so this is all I am going to say. This man is a disgrace to our political system and should not even be aloud to be our employee until his investigation by the RCMP is completed. Had I been involved in something as suspicious I would never have a job. These people are different and they make sure we know it but fortunately this is going to change soon. The world is reaching a tipping point and politics is one of the areas that will be strongly affected. I am ready for it.
    It is time for all of us that truly care for our province to stop this horrendous drain of our resources to everyone else except our people. We do not need to continue enriching billionaires and corporations that already control our political system. Believe me, no one does everything necessary to control the government of our province and allow this draining for nothing.

    • Dwayne says:

      Carlos Beca: I agree with you completely. I do remember when Peter Lougheed was in power. He managed Alberta’s finances really well, by saving money, building things up and planning for the future. The other Alberta PC premiers did not do that. They accepted poor oil royalty rates for our oil, drained the Heritage Fund to practically nothing, wasted the largest sums of money on the worst scandals, did not save money, gutted essential services, did very costly privatization and deregulation schemes, like with utilities, greatly magnifying their cost, left Alberta with a mega billion dollar infrastructure debt, by not maintaining it for decades, and gave Albertans a $260 billion bill to clean up oil industry made messes. The UCP wants to blame the NDP for this. Oil prices went down 5 years ago, due to Saudi Arabia and America supersaturating the market with cheap oil. Triple digit oil prices are gone, and no new pipeline will change that. The Blue Ribbon Panel, made up of ultra hard Conservatives, under different political banners, knows the Alberta PCs made the mess. The UCP is not improving things one bit. Their corporate tax cut, and other big mistakes cost Alberta around $15 billion.

    • Carlos, I too noticed that Kenney was not on the podium sharing the glory with Ms MacKinnon and Mr Toews when they released the report and answered questions from the media. As you point out we’re doing a poor job of holding these governments and their outside consultants accountable. I get that we’re not all accountants or economists, but good lord, there are more than enough out there who could do a “deep dive” on the report and ask a few questions. Sadly the reporters and journalists seem to do nothing more than regurgitate what the report said, as opposed to thinking about whether what it said makes any sense.

    • Carlos it was interesting reading the debate in Hansard on Kenney’s $4.5 billion BILLION gift to corporations. The NDP cited solid sources from the US, including Congressional office reports, the mess in Kansas, Trump’s failures, etc. All the UCP could come back with was “we won, you lost, we’re not taking economic advice from you.” (So we’re going to cover our eyes and plug our ears until you go away? Is that it?).
      I’ll bet you could quiz the lot of them and they wouldn’t understand the impact of what they’ve done.

      • Carlos Beca says:

        Wow this post scared me because I thought I was getting blind with my distaste for this UCP gang but your last sentence made me feel calmer.
        At first I thought that at least they seemed like they were competent right wingers. Now I do not believe it anymore. So my concern is not just the fact that they are going in the wrong direction, but that they do not have a clue of what they are doing.
        MacKinnon is known for having left Saskatchewan in tatters although they believe otherwise.
        With their level of taxation we would have no problems so what is the big deal?
        This issue with the word PUBLIC is more than what they say it is and we will have confirmation very soon.
        My biggest worry is that Jason Kenney is to me a dishonest person, whether people like it or not. Anyone that lies like he does is of no interest to me personally or professionally. Some people do not mind it because that is how they run their lives and how they feel about a business person. I have an issue with it and I do not want any of their mentality running the province. It is very simple to go into that mode and transform the province into gangland. Furthermore he has never been a businessman. Unless he sells trinkets from home.

      • Carlos you mentioned Jason Kenney’s character or lack thereof, what interests me even more is the character of Albertans who are prepared to go through a second round of austerity in the hope the good times will return. It’s a devastating trade off. My daughter and I are here in Italy on vacation. I did a little research and learned Italy has good national healthcare and good public education. People value these things and are prepared to pay for it. I’m not saying Italy doesn’t have problems, but if a country (or in our case a province) is prepared to invest in its people at least they have the tools to make something of themselves, they’re not being held back by those with more power. Oh and I checked out the link you provided about the elderly taking their own lives in Japan. It said the #1 cause was illness and the #2 cause not far behind it was economic uncertainty. That is no way to treat people who worked hard to build opportunities for those who come after them.

  5. Dwayne says:

    Susan: Thanks for another great blog. I heard that Janice MacKinnon acknowledged the Alberta PCs having something to do with Alberta’s fiscal problems. That was impossible for Postmedia newspapers, like The Sun, to hide. I gave you that article title last week, stating how The Sun blamed the NDP for Alberta’s fiscal problems. The Sun had to eat humble pie, after the Blue Ribbon Panel report came out and could not avoid the report mentioning the Alberta PCs having responsibility for Alberta’s poor fiscal shape. They quickly brushed it off, and today, they had an opinion piece praising the court’s ruling against the AUPE, (I believe that’s who it was). The Sun thinks this will save Alberta taxpayers money. It won’t. The Sun, fairly recently did not mention the Alberta PCs wasting $35 billion on a petrochemical (bitumen) upgrader, which Jason Kenney admitted is impossible to get out of. Other media outlets reported this recently. It was brought up before the 2015 provincial election and helped sink the Alberta PCs. I already explained to Carlos about the Alberta PCs being fiscally reckless, since Peter Lougheed was not the premier. The UCP is going down that same road. The UCP has already made around $15 billion in very costly mistakes. I also heard the Blue Ribbon Panel wants more expensive post secondary education. There is that, and more deregulation and more private for profit health care, (which you also touched on). The UCP’s halting of the superlab completion, has cost people their jobs, in building it and running it. People who need medical tests done, must go elsewhere. It will be a rough 4 years. As triple digit oil prices are a thing of the past, like horse drawn wagons on city streets are, how will the UCP get revenue, if they cut corporate taxes? I see more Ralph Klein style cuts. We still are reeling from those. Ugggh! This is a nightmare. I don’t see it getting better. As Procol Harum had in their song around 28 years ago, the truth won’t fade away. The UCP and their followers know what the truth is, but don’t want to listen to it.

    • Dwayne, you’re right that the MacKinnon report said quite clearly that Alberta’s financial predicament was made worse by 20 years of PCs providing lots social services when oil and natural gas prices were high and then pulling back when prices dropped. What she didn’t get into was how badly the PCs damaged the social safety net when Klein went on his austerity kick. The healthcare and education professions suffered, real people were irreparably damaged. Once you create a hole in the social safety net, it takes a lot of money over a number of years to fix it. It’s clear from her report she had no intention of fixing anything other than the economic side of the equation because those were her marching orders. I really believe this report has no credibility, unfortunately gullible Albertans will accept it as evidence that Kenney is right. Let the cutbacks begin!

      • Dwayne says:

        Susan: If one is rich, the cutbacks will not affect them at all. If they are not well off, the cutbacks will affect them.

      • Dwayne this is true unless a rich person has a heart attack at 2 a.m. Then he/she is stuck at home waiting for an ambulance and assuming it gets there in time, ends up parked in the hallway on a stretcher like the rest of us. I don’t think they realize that all the wealth in the world won’t get them a helicopter that can deliver them to the Mayo Clinic in time to recover.

  6. Guy Smith says:

    Great analysis! It’s clear that the MacKinnon Panel was overly influenced by the Kenney government to come up with the answers that they would agree 100% with Kenney’s preferred outcomes – without addressing the revenue side of the equation. Now let’s see what damage Kenney will do with these recommendations. My guess is: “a lot.”

    • Guy, I agree with you 100%, the MacKinnon Panel gave Kenney the green light, the only thing that will slow him down is a backlash from the public, but they won’t see the damage austerity will cause until it mows them down.

  7. J.E. Molnar says:

    Thanks Ms Soapbox for helping to expose the Kenney and MacKinnon charade and sleight of hand for what it really is — smoke and mirrors propaganda designed to attack public services and public sector workers.

    By ignoring the taxation side of Alberta’s balance sheet as a generator of revenue, this collection of hand-picked tendentious market-fundamentalist thinkers — posing as the “Blue Ribbon Panel on Finance” — is prepared to dismiss as much as $8.2 billion annually from provincial coffers. That’s the amount Alberta would receive if they taxed at the same rates as B.C.

    Scrapping the carbon levy, lowering corporate tax rates, refusing to ship our oil by rail and refusing to tax at amounts comparable to B.C., Ontario and Quebec makes the entire Mackinnon/Blue Panel fiasco look foolhardy and contrived. Good work on drilling down on the details!!

  8. GoinFawr says:

    No more “Public” schools allowed in Alberta.

    Neoliberal MO:

    Step 1: denigrate the publicly funded program, ignoring reality
    Step 2: under fund the program
    Step 3: Present your ‘final solution’ (privatization) as inevitable

    First they came for the teachers,
    And I said nothing because I had no kids in school.
    Then they came for the hospitals,
    And I said nothing because I was young and healthy,
    Then they came for the unions,
    And I said nothing because I was envious that they earned a living wage.
    Then they came for me,
    and there was no one left to speak for me (mostly because I was a self serving jerk)

    • Carlos Beca says:

      yes that is exactly right.
      While the world tries to resolve issues of climate change, poverty, racism….etc our intelligent premier and his supreme minister of education eliminate the word ‘PUBLIC’
      It is a word that causes them nausea. It is a word that indicates our common good and our community. It is a word that indicates that we are work together to give our kids the best education possible. Of course they hate it. They want that money to flow to their friends that own private schools and to their elite kids.Private is what works
      I am done with this garbage. What a bunch of psychos and the 53% that voted for them. Destroying what is left in this province.

      • Dwayne says:

        Carlos Beca: The UCP is there to finish the big mess that the Alberta PCs made, starting when Peter Lougheed was not the premier. If Peter Lougheed were still around, he’d let the UCP have it. Rachel Notley was the best premier of Alberta since Peter Lougheed, and many Albertans chose a Ralph Klein clone. Disgraceful.

    • carlosbeca says:

      Watch out people Lorne Gunther of the Edmonton Sun is going to have a mental orgasm with the elimination of the word PUBLIC, What a thrill.
      This reminds me of the changes the communists implemented in Africa where they changed overnight all the local road names to ‘Lenin Street’ and ‘Breznev Avenue’ and ‘Trostsky Plaza’
      PROPAGANDA – that is all this is. The word Public might expose the kids to socialistic ideas and of course that is extremely dangerous. We want our kids to be fascists.
      We know already what our minister of Education is like – another idiot
      Leave the word Public alone and concentrate on what matters – education
      This is just the beginning of the second coming of a nut case

      • Dwayne says:

        Carlos Beca: You are right. The columnists and most of the people who write letters to the Edmonton and Calgary Sun, have quite the imagination, and are quite far from reality. Typical for Postmedia. Ignore the Conservatives far worse mistakes and deflect to non issues elsewhere.

    • Dwayne says:

      GoinFawr: This is a return to the Ralph Klein Years. Not a surprise. Not anything to celebrate.

      • Dwayne, it’s as if all the people who suffered through the Klein years have developed amnesia. Makes no sense, those who were around between 1992 and 2006 are a good 20 to 30 years older now, they of all people need good healthcare and long term care, both of which will suffer if Kenney goes ahead with the cuts recommended by Ms MacKinnon. And their kids aren’t going to be happy to pick up the slack and care for their elderly parents at home or foot the bill for expensive private elder care.

      • Carlos Beca says:

        Well Susan our kids, for the majority of cases, will not be able to afford elder care for their parents. I will be happy if my kids can take care of themselves and their own kids. So the future is not only what you suggest but worse. Just like in many other countries in the world, if the parents are close to their kids, they have a chance to get some basic help, otherwise they will get dumped anywhere. Many just do what I think can happen here as well – they commit suicide. For many of them it is a relief.
        By the way this is not just in poor countries. In Japan this is already a major issue. I could give more examples but I would rather leave it in case someone questions what I have just said, because contrary to the current fact less society, I either have facts or I can point to articles that I have read and that can be confirmed.

        Here is one of them from the Telegraph

        https://www.telegraph.co.uk/news/worldnews/asia/japan/2158822/Elderly-Japanese-suicide-in-record-numebrs.html

    • GoinFawr this sums up our predicament very nicely. I door knocked for a number of candidates and and myself in 2014. I can’t tell you the number of times someone told me they weren’t voting for my candidate (or me) for precisely these reasons. Envy and complacency seemed to be the order of the day.

  9. Blair Backman says:

    Thanks so much to bringing this travesty to the public attention. Susan.
    Ghengis Khan in the skirt has spoken.
    After her burnt earth policy as finance minister in Saskatchewan we saw the health care system decimated, schools and students sacrificed and the civil service “pruned” to the point of near elimination.
    In her goal to convince the nation that the Devine govt had erred in trying to maintain the financial base of Saskatchewan, the agricultural sector, she burnt down the engine of the Sakatchewan economy. When Jason Kenney is on the same mission to cast his predecessor as the cause of all ills, she is the ideal hatchet (wo)man for the job.
    In Saskatchewan she missed the opportunity to suck local govt dry, an oversight she evidently regrets by her recomendations to Jason the Hun! In Saskatchewan we witnessed the ripping up of paved highways and reducing them to gravel. Only the dedication and perseverance of our local government politicians in maintaining our grid road system continued a transportation network in Saskatchewan. Given the opportunity to redo her destruction, be certain she will not allow local government to escape this time!
    And she trots out the tired old horse of the provincial sales tax again! Alberta has proven that there is more money to be made by taxing the profits arising from the additional economic activity of having shopping holidays from Saskatchewan and BC filling Alberta retail stores and hotels. It is better to milk the cow continually than to butcher it once.
    In BC we will brave ourselves for the inevitable convoys of diesel pickips with the hanging bull balls carrying economic refugees from the second coming of Janice.
    To paraphrase Albertan papers of the 1990’s that loved to revel in Saskatchewan’s travails under Janice -“will the last person in Alberta please turn off the lights when they leave!”
    And drive a wooden stake through the heart of Ms MacKinnon-this is one vampire that should never be allowed to speak again!

    • Blair it sounds like the “medicine” was worse than the “cure” in Saskatchewan, I expect the same to happen here. I agree that Ms MacKinnon doesn’t seem to have learned from her experience in Saskatchewan. At one point in the Blue Ribbon Panel Report she refers to Saskatchewan being able to reduce wait times for simple procedures by privatizing them. What she doesn’t say is the Saskatchewan privatization experiment failed when the private doctors demand more and more money from the government to carry on, eventually the government shut down the private clinics and rolled everything back into the public sector, which ended up with even longer wait times. It takes a lot of hubris to cite an example of something that ultimately failed as proof of success.

  10. Edison says:

    “Furthermore, she’s [Catherine McKinnon] against borrowing to finance capital spending”

    “This is contrary to David Dodge’s advice that the government should borrow to finance capital spending in times of slow growth”

    Dodge’s perspective regarding government spending during these times was echoed by the then head of the International Monetary Fund (IMF) Christine Lagarde in regards to the Trudeau government’s fiscal strategy in 2016 as it was trying to contend with Canada’s fragile economy

    “I really very much hope that [these] Canadian economic policies can actually go viral,” Lagarde said in the foyer of the House of Commons after meeting with Trudeau on Tuesday”

    That being the case, I would add the IMF along with Mr. Dodge to “who do we trust:  Ms M or…?”

    • Edison, I was unaware Christine Lagarde endorsed Mr Dodge’s approach. You really have to wonder about the qualifications of the people who undertook this report given how many top economists would disagree with Ms M’s recommendation on capital spending. I just wish people who say the Blue Ribbon Panel nailed it would just read the report before becoming a sycophant.

  11. GoinFawr says:

    When it comes to public works spending I think we should have kept trusting Mr. M (McGeer) and his Constitutionally condoned monetary policy. Worked wonders for Canadians for ~7 decades, right up until Trudeau Sr. adopted the ‘recommendations’ of the Basel Committee around 1974, for whatever reason :

    • GoinFawr, that’s a pretty impressive graph! Thanks!

      • GoinFawr says:

        The site it is from is decent, though the Canadian taxpayers paying their piece of the 160 million CAD/day of interest (at the current low low rate) ought not to be too impressed by that graph; it represents the way the Basel committee figured out how to bring back the practice of passing debt obligations down from father to son. Something private banking interests had lost, and desperately wanted to reinstate.

        And did, quite successfully too, as you can see

      • Indeed! Thanks GoinFawr.

    • Anonymous says:

      GoinFawr: This should set the record straight, as to what happened to Alberta’s finances. More people need to be made aware of this. The Alberta PCs, after Peter Lougheed left office, are the ones who virtually depleted Alberta’s finances, from multitudes of very costly scandals and neglect. Since 1986, the Alberta PCs allowed rip off royalty rates for our oil, depriving Alberta of $200 billion. Since 1986, the Alberta PCs virtually depleted the Heritage Savings Trust Fund, leaving hardly anything in it. Ralph Klein used it for very costly scandals, like Alpac/Mitsubishi, to help fund his provincial election campaigns, and to help pay off the provincial debt/deficit. Since 1986, the Alberta PCs did the most costliest scandals in Canadian history. The $67 million Gainer’s scandal, the Principle Trust scandal, wasted $110 million on a metal smelting plant screwup, did the $600 million NovaTel scandal, did the now $5 billion, (and growing) Swan Hills waste treatment plant blunder, did the $180 million Miller West Pulp Mill debacle, did the $240 million MagCan scandal, blew almost $500 million, trying to bail out West Edmonton Mall, did the $125 million ambulance amalgamation screwup, did the $100 million A.I.S.H scandal, (which was complete with Ralph Klein and his colleagues laughing at and mocking the handicapped on T.V), made us pay for the Stockwell Day defamation lawsuit costs, did the $400 million B.S.E bailout failure, did the $34.5 billion electricity deregulation disaster, did the $7 billion PPA debacle, that went with it, wasted $2 billion on carbon capture and storage, wasted money on luxury penthouse suites, wasted money on expensive plane flights, that had no extra passengers, did the $26 billion Northwest Upgrader fiasco, that had $9 billion in added costs, lost Alberta $10 billion from Alison Redford’s tobaccogate lawsuit scheme, which she did, and got away with, has expensive lawsuit costs against the Alberta government, in relation to the numerous deaths of foster children in Alberta, left Albertans with a $260 billion bill to clean up abandoned oil wells in Alberta, and so much more. Ralph Klein’s flat tax disaster lost billions of dollars from Alberta’s revenue streams. As of 2014, corporations in Alberta owed $1.1 billion in unpaid taxes. For many years prior, corporations in Alberta owed very large amounts of money that went uncollected by the Alberta PCs. The Alberta PCs put in various taxes for Alberta. This includes a carbon tax that Ed Stelmach put in. Jason Kenney did not get rid of Alberta’s carbon tax. We still have it. The Alberta PCs put in taxes on alcohol, on cigarettes, on beverage container purchases in Alberta, on motel stays in Alberta, with health care premiums, with VLTs, (which are a regressive type of tax), and with electronic device purchases in Alberta. Before Alison Redford was premier of Alberta, the Alberta PCs were thinking of implementing a P.S.T for Alberta. The Alberta PCs, after Peter Lougheed left office, badly neglected infrastructure in Alberta, leaving Alberta with a $26 billion infrastructure debt. The UCP’s corporate tax cuts have cost Albertans $4.5 billion. The UCP has already made over $13 billion in very costly mistakes. We can be sure drastic Alberta PC type cuts are coming.

    • Anonymous says:

      GoinFawr: If people in Alberta make illogical excuses as to what happened with Alberta’s finances, show them what I said.

  12. Pingback: Part 3 UCP Economics Alberta – Lie Tracker

  13. David says:

    Comparisons are a tool of limited value and it does seem Ms. MacKinnon over relied on them in making sweeping generalizations while ignoring some of the important underlying reasons for differences There will always probably be places that spend more or less on things than us. I am guessing if the comparison was Bangladesh, we would find Alberta spends much more per capita on health care education and capital projects. So yes, an argument can always be made it is possible to spend less, but would it always be a good outcome or the outcome we want?

    It was mentioned in the media that the health care spending per capita comparison with BC does not factor in that we do not have health care premiums and have a better seniors drug coverage plan than BC. It hasn’t been as widely noted that under a previous government BC closed a number of hospitals in smaller communities, whereas Alberta has so far chosen to keep almost all of them open in the last decade. So yes, we can reduce health care spending to BC levels, possibly in part by reducing seniors drug coverage and closing rural hospitals. Is this what Albertans want? Comparing spending levels between provinces is not very meaningful when the choices involved are not noted or brought up.

    If we are to make comparisons, I think it would be most meaningful not to try cherry pick and find places that spend less, but look at where Alberta ranks overall. As I recall, the PC’s in the 70’s and 80’s seemed to take pride in the fact that Alberta spent more per capital in a number of areas. We were number 1. After spending reductions in the 1990’s I haven’t heard that mentioned much. When I have seen periodic rankings of spending, Alberta has often been somewhere in the middle. In some cases, it is easier for a larger province such as Ontario or Quebec to spend less per capita because of size and economies of scale. It is more of a challenge for mid size and smaller provinces. Also we have higher average wages, in large part driven up by the energy industry over the last 15 or 20 years. In fact, even in the current economy, Alberta still has higher average wages and a higher labour force participation rate than other Canadian provinces. Wage growth and that pressure has mostly abated here in the last few years and with a number of years of zero percent increases that situation starts to balance itself out on its own, as it is now.

    However, Ms. MacKinnon seem to have a predetermined agenda to follow, so rather than a detailed analysis and an informed discussion, we instead just get cherry picked figures to support the conclusions she wants to make.

    • David, I agree, Ms MacKinnon knew what she had to do and did it. Compare how Kenney handled this panel with how Notley handled her expert panels. She picked well known experts (David Dodge on capital spending, Peter Tertzakian on the royalty review, Andrew Leach on climate leadership, Hal Kvisle on natural gas competitiveness) gave them a clean slate and the freedom to do a comprehensive job and accepted their recommendations. Kenney was afraid an independent panel would come up with something that contradicted his campaign promise of balancing the budget by 2023 so he picked an ex-politician known to support austerity and gave her a mandate that would produce only one outcome. And he has the temerity to accuse the NDs of being ideologically driven. Kenney is nothing if not ideological, my question is which ideology, a free market ideology? A new-liberal ideology? A Trump-like thin skinned and lash out at critics ideology? It’s certainly not a conservative ideology in the Peter Lougheed sense.

  14. Carlos Beca says:

    I am in trouble – Jason Kenney just launched a website for spies on people trying to keep oil in the ground – charities subsidized by foreign interests. Well I am trying to keep his brain in the ground so it is dangerous times ahead.
    I wonder if we can spy on foreign interests taking the oil without paying anything – like oil poachers. There are quite a few around.
    OMG the times we are going through

    • Dwayne says:

      Carlos Beca: The late, great Peter Lougheed said that the oil belongs to Albertans. That changed with the provincial PC governments in the 1990s. Alas.

    • Carlos, this latest development is extremely upsetting. I’m in Italy and just read Kenney’s press release responding to Amnesty International’s criticism of Kenney’s comments re: environmentalists (he recently cited Putin (Putin!) as an example of how to push back against the “bully” environmentalists. After he mentioned Putin, he said he wasn’t recommending Putin’s approach (sent the environmentalists to Siberia where they were never heard from again), if so why mention Putin in the first place. Also as PressProgress pointed out, Kenney’s version was a lie. Putin did jail the Greenpeace guys for 2 months in St Petersburg. They were freed and sued and won $3 million for unlawful seizure. Kenney is as bad as Trump.

  15. John Clark says:

    Kenny is turning into a one man destructive force for the Conservatives!

    Front and Centre The Conservatives are actively working on killing the Tans mountain Expansion, which, will hurt every pocketbook in Canada! The Conservative Premiers spent two full days making a case for trashing bill C48 and C69 which are designed to kill the project! Trans Mountain Expansion Project, Including 15,000 Jobs and $46.7 Billion in Tax Revenue annually! Gone, as soon as you vote in Conservatives, Our major river emptied!
    Take a moment to read the post on these two bills the Conservatives are trying to kill.
    This brings me to the #Weatherford Project. It is so named after the company who designed and specked it.
    Weatherford is immensely designed to move 2/3rds of the flow of the Peace River to the US border. If Conservatives build, this Canadian’s will pay for the build so the US can get cheap water.

    The design calls for 4 large diameter pipelines and six pumping stations. Each pumping station to use the electrical power of a city! Kenny is already ramping up generation in the oil sands.
    The Conservatives are again looking after US interests, not Canada’s!

    Kenny was recently on TV opposite an environmental lawyer while jetting around the country. She was Trashing Tarns-Mountain expansion, and he was sitting there, nodding and smiling his approval.

    The US does not want us shipping oil our west coast into Indonesia and China! If they are allowed to kill the Trans Mountain Expansion, natives will lose their investments and Canada will miss its venture into the expansion.

    He has to make up for the lost revenue on the pipeline they are trying to cancel; The trans mountain expansion west. Canadians Receive A Wide Range of Benefits from the Trans Mountain Expansion Project, Including 15,000 Jobs and $46.7 Billion in Tax Revenue annually!

    • John, you mentioned water…I think most Canadians are not aware of how careful we have to be in our negotiations with the Americans over water. We have it, they’re running short of it in many places. As a friend of mine said, the US sees Canada as a giant freezer that they can dip into anytime they run short of anything.

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