CanPol - Alberta edition

[Asher]

Do you actually believe that? It's ridiculously naive.

PEOPLE WILL COME FROM AROUND THE WORLD TO LEARN ABOUT THE OIL SANDS! AND PAY TO DO IT.

Come spend billions of dollars in taxpayer money in Edmonton NOW!!

[notyoueither]

Actually, I don't know if it is a good idea from this POV.

It is a good idea from the POV of getting federal money to annoy Calgarians, build **** for the UofA, and... there's a third step here before profit.

[Flubber]

hmmm NYE as I see it you have put forth a few different deas in this thread



1. Support for Sales tax for Alberta- While the economic consequences and desirability/ efficiency of such a tax are far more debateable than Asher would suggest, its simply currently politically unpalatable. I just cannot see the Conservatives imposing a brand nex tax when the main threat to their "governing party" status comes from the right. Realistically can you ?

2. Support for the World Expo thingy in Edmonton. As a Calgarian it annoys me not at all that Edmonton is involved in such a bid. I was was however quite happy when calgary dropped out sicne my admittedly cursory knowledge of the thing was that Calgary itself would have to pony up signifigant funds. haven't these things typically been big boondoggles with huge cost overruns?

I find it odd that you main reason for being happy at this concept is the idea that Edmonton will get "federal money" as if this money is somehow different from other money that taxpayers of every stripe give every branch of government. I haven't looked closely at the plans for this expo . If the resulting infrastructure is worth the cost then "yay'. Hell I might even attend the freakin event . . . It still wouldn't change my general fear that this could be a huge waste of funds.

3. Support for higher royalties (even if it makes Alberta uncompetitive/uneconomic currently ). I wasn't sure how far your position goes on this point. If it is simply that Alberta shouldn't be racing to provide the lowest royalties anywhere, well I would agree with you. That could probably ignite anotehr huge oil boom sending wages and housing costs and the whole economy into overdrive again. The decision has to be made as to what you are trying to achieve with your royalty regime. personally I would like to see something that was reasonably competitive such taht a sustainable level of activity could be maintained. UNfortunately thats almost impossible to design in the long run sicne its impossible to predict all the technology advances, changes in commodity prices, exchange rates and many other factors. A regime that works today to maintain employment levels relatively constant might be crippling to the industry in a low price regime or may see huge activity if commodity prices skyrocket.

Overall I am not sure what you espouse- All I know is that current levels of Alberta royalties (not counting all the recent incentive programs) makes a bunch of different types of Alberta plays simply uneconomic at reasonably forseeable prices. Is your attitude 'fine, leave it in the ground" ? (big consequences on government revenues and even more as the job losses start?) Or are you willing to consider royalty regimes that at least permit some activity to be sufficiently profitable?

Put another way-- Alberta has comparatively little non-oil sands oil left compared with its natural gas resource. Given the relatively large quatities of natural gas resource discovered in NA, do you want Alberta to have a natural gas industry in the short to medium term or would your preference be to save the bulk of the gas for future generations?

[notyoueither]

hmmm NYE as I see it you have put forth a few different deas in this thread



1. Support for Sales tax for Alberta- While the economic consequences and desirability/ efficiency of such a tax are far more debateable than Asher would suggest, its simply currently politically unpalatable. I just cannot see the Conservatives imposing a brand nex tax when the main threat to their "governing party" status comes from the right. Realistically can you ?

My mentioning a sales tax is from a POV of what should be, not what I realistically expect to happen.

2. Support for the World Expo thingy in Edmonton. As a Calgarian it annoys me not at all that Edmonton is involved in such a bid. I was was however quite happy when calgary dropped out sicne my admittedly cursory knowledge of the thing was that Calgary itself would have to pony up signifigant funds. haven't these things typically been big boondoggles with huge cost overruns?

I don't know. Do you have examples of Expos that are run poorly? Run well?

I don't see a reason to assume cost overruns unless the pace of development opens up again and the costs of materials and labour go back to lunacy levels. I don't think that possibility should be discounted.

I find it odd that you main reason for being happy at this concept is the idea that Edmonton will get "federal money" as if this money is somehow different from other money that taxpayers of every stripe give every branch of government. I haven't looked closely at the plans for this expo . If the resulting infrastructure is worth the cost then "yay'. Hell I might even attend the freakin event . . . It still wouldn't change my general fear that this could be a huge waste of funds.

Federal dollars are different from taxes paid to local authorities and the province. Much of the taxes paid federally disappear from this jurisdiction and are never seen again. I don't begrudge dollars paid in Alberta and Ontario going into hospitals and schools in Quebec, Manitoba, and New Brunswick as some other people do. OTOH, getting some federal dollars for a significant development that will leave behind facilities for the UofA, generate activity locally, and perhaps help public perception of an industry critical for the future of the province sounds triple plus good to me.

3. Support for higher royalties (even if it makes Alberta uncompetitive/uneconomic currently ). I wasn't sure how far your position goes on this point. If it is simply that Alberta shouldn't be racing to provide the lowest royalties anywhere, well I would agree with you. That could probably ignite anotehr huge oil boom sending wages and housing costs and the whole economy into overdrive again. The decision has to be made as to what you are trying to achieve with your royalty regime. personally I would like to see something that was reasonably competitive such taht a sustainable level of activity could be maintained. UNfortunately thats almost impossible to design in the long run sicne its impossible to predict all the technology advances, changes in commodity prices, exchange rates and many other factors. A regime that works today to maintain employment levels relatively constant might be crippling to the industry in a low price regime or may see huge activity if commodity prices skyrocket.

Overall I am not sure what you espouse- All I know is that current levels of Alberta royalties (not counting all the recent incentive programs) makes a bunch of different types of Alberta plays simply uneconomic at reasonably forseeable prices. Is your attitude 'fine, leave it in the ground" ? (big consequences on government revenues and even more as the job losses start?) Or are you willing to consider royalty regimes that at least permit some activity to be sufficiently profitable?

To begin with, there was too much development in the recent past. Before the bust, before the oil bubble burst, before the royalty changes... projects were being shelved or cancelled due to shortages of people qualified to do the work and increases in labour and material costs.

I am in favour of royalties that are fair. According to the government, the total government take in Alberta is still lower than most other jurisdictions important for petroleum. I have been looking for hard facts, but have not found much out there. Do you have any? What are the royalties and other taxes paid in Russia? Nigeria? Iran? The North Sea? Mexico? Saudi? UAE?

Whether any given project is economic or not is not what I am concerned about. It strikes me that to make the last few economic we'd be dropping the rate on all the rest. Not entirely though, since the royalty system seems to take that into account in it's various ways of sliding the scale.

Furthermore, as you mentioned, incentives can be used to spur development when times are lean. I prefer that to having low taxes whether the price of oil is $40 (incentives needed) or $150 (we have to bar the door to keep development at a reasonable pace).

Put another way-- Alberta has comparatively little non-oil sands oil left compared with its natural gas resource. Given the relatively large quatities of natural gas resource discovered in NA, do you want Alberta to have a natural gas industry in the short to medium term or would your preference be to save the bulk of the gas for future generations?

If nothing gets drilled, then some changes would clearly be in order. Whether that be changes to the royalty system, temporary incentives due to prices, or a public corporation to engage in the activity in place of piqued private industry is a whole other can of worms.

As for gas, I am under the impression that its value has decreased dramatically and will stay there for years due to the unlocking of previously uneconomical reserves in the US and elsewhere that are quite large as well as closer to consumers. I think I've said dead or dying somewhere in this thread.

I'm not in favour of government killing the gas industry, but clearly the industry in Alberta was facing a large decline regardless of the royalty regime. I have nothing against some tinkering around the edges or incentives, but as I've also said elsewhere it's all about the bitumin(s).

[Asher]

nye, I'm fairly certain no Expo has ever been profitable. At the very least, no Canadian one has been.

[notyoueither]

He mentioned cost overruns. I take that to mean going over budget.

I know the event itself will end in the red, but then buildings will be constructed for 90 days occupancy. They will be left behind for the University.

[Asher]

Then Edmonton and the UofA can provide sole funding for it.

[notyoueither]

Or the province and the fed can pay for most of it.

[Asher]

Not with my money.

[notyoueither]

Oh yes, yes, with your tax money.

[notyoueither]

Or perhaps in the memo field of your payments to Canada Revenue you could note 'not for Expo in Edmonchuckville!'

Then you could sleep better at night.

[Asher]

It's not going to happen. Don't worry.

[notyoueither]

Good possibility it won't.

Then we can talk arenas!

[Wezil]

Wildrose now has a double digit lead over Tories.

The surging Wildrose Alliance party would form the next provincial government in Alberta if an election were held tomorrow, according to a new poll of decided voters that gives the right-of-centre party a double-digit lead in popular support over the long-ruling Tories.

A new Angus Reid Public Opinion survey of 1,000 Albertans suggests 39% of voters would cast a ballot for Danielle Smith and the Wildrose Alliance.

The fledgling party is pulling away from Premier Ed Stelmach's Progressive Conservatives, who were tied with David Swann's Liberals for second place with the backing of 25% of decided voters province-wide, according to the poll.

Brian Mason and the NDP are in fourth spot with the support of 9% of Alberta voters, while 2% said they would vote for another party.

The Wildrose Alliance -- buoyed by their recent leadership race and byelection win in the Calgary area -- is solidly in first place in every region of the province, according to the poll.

The Tories have slipped to third place in both Calgary and Edmonton amid challenging economic times, and continued public criticism over the government's financial management and the H1N1 vaccination rollout.

"It's no secret that the Wildrose Alliance have been gaining momentum," said Angus Reid pollster Hamish Marshall. "Right now they're on track to form a government."

The current survey data, which reflect similar trends from other recent opinion polls, would put the Wildrose Alliance "right on the line" between a majority or minority government, he said. But Mr. Marshall cautioned the numbers reflect a snapshot in time and that the next provincial election is likely at least two years away.

Nevertheless, support for the Wildrose party is growing in every corner of the province at the expense of the Tories, who have ruled Alberta since 1971.

In Calgary, the Wildrose Alliance is backed by 38% of voters, followed by the Liberals with 30%, Conservatives at 23% and NDP at 6%.

"Clearly, people seem to have turned their backs on the PCs and the Stelmach government," Mr. Marshall added.

In Edmonton, the Wildrose party leads with 36% support, the Liberals are at 26%, Conservatives at 25% and NDP at 12%.

In the rural ridings -- historically the bedrock of Tory support-- Ms. Smith's party is way out in front with the backing of 44% of voters, compared to 25% for the Conservatives, 21% for the Grits and 7% for the NDP.

"If these numbers are true, it's beyond worry [for the Tories]. I think they should be terrified," said David Taras, political analyst at the University of Calgary. "With these numbers, it's really a race to the bottom, a toboggan ride to nowhere."

Prof. Taras said the deeper question for the provincial political landscape goes beyond public opinion, to whether or not Albertans have made a judgment on Mr. Stelmach as Premier.

"Public opinion can change, but it's much more difficult to change a judgment," he added.

Several questions remain with the Wildrose Alliance and its leader, Prof. Taras said, noting the party must still clearly define some of its policies and carve out an identity prior to the next election, expected in 2012.

What's more, he said, Alberta's decreasing voter turnout could also play a large role in whether survey numbers hold true on election day -- he noted the Tories' sliding poll results prior to the 2008 election before they stormed to a massive majority.

However, Prof. Taras highlighted the trend line for the ruling Conservatives continues to sink, which indicates changing public opinion.

An Environics poll conducted in mid-to late October showed the Wildrose party had cemented itself in second place province-wide. That survey found Mr. Stelmach's Tories had slipped 21 points in the polls over the last year -- the Conservatives' lowest level of popular support since December 1993.

The new Angus Reid online poll of 1,000 randomly selected Albertans was conducted Nov. 23 to 29 and has a margin of error of plus or minus 3.1 percentage points, 19 times out of 20.

http://www.nationalpost.com/news/story.html?id=2327477

[Asher]

Poor Ben...