We are not told when this bust is supposed to happen or even much as to why. Some of the proposals in this article such as the windfall profit taxes are as likely to be implemented in Alberta as to find a live dinosaur at Drumheller!
Alberta Headed for Major Crash Unless We Change Direction Now – New Report
EDMONTON – The Alberta economy is headed for a serious economic bust, and current government policy is only serving to aggravate the problem, says a new report released today by the U of A’s Parkland Institute.
Taming the Tempest: An Alternate Development Strategy for Alberta highlights the Alberta government’s current disregard for such things as planning infrastructure and investment, maximizing oil and gas revenues, prioritizing value-added jobs, and saving for the future. It notes that current government policy is not only exacerbating the negative impacts of the boom, but will also result in a much harsher bust than we would have otherwise.
“The Alberta government’s mishandling of this boom has resulted in growing homelessness, skyrocketing inflation, and an economy that is entirely vulnerable to the whims of international energy markets,” says Diana Gibson, the report’s author and Research Director for the Institute.
Ms. Gibson points out, however, that a bust is avoidable. “In order to lessen the negative impacts of this boom, and pre-empt the looming bust, the provincial government must show some vision and leadership, and implement a new economic strategy.”
“Lord please send another boom, and I promise not to blow it again.”- Alberta bumper sticker of 1980s.
The report explores a variety of different options, and then goes on to make a series of concrete recommendations for a new direction. Some of the key suggestions in the report include:
* pacing private sector developments through:
o a competitive bid process for fossil fuel royalties,
o internalization of environmental and infrastructure costs;
* using some of the space created by private sector pacing to eliminate the public infrastructure deficit through public investment;
* maximizing the return from fossil fuels through the competitive bid system , and by instituting a windfall profits tax of 90% for profits above a 10% rate of return;
* an immediate moratorium on new pipelines for bitumen and other raw fossil fuels exports, and prioritization of natural gas for value-added industries rather than for export;
* limiting to 10% the amount of natural resource revenues transferred to general revenues in any given year; and
* investing 50% of resource revenues into the Heritage Trust Fund, and the remaining 40% into a new Renewable Energies Fund.
“Such strategies would mitigate the boom-bust cycle, and create longer-term sustainability and prosperity for all Albertans. The goal of this report is not to provide a definitive or comprehensive set of solutions,” says Ms. Gibson, “but rather to highlight the urgency of the issue, and to provide a starting point for discussion and dialogue between Albertans and their government.”
Copies of the report are available on the web at www.ualberta.ca/parkland or can be requested by phone at (780) 492-8558.