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For Alberta's carbon tax and pipeline problems, hope is not a plan

You’ve seen the ad. One young man, a Questrade investor, has invited his friend to his apartment. The envious guest says he hopes he can afford a down-payment someday. The investor-bro says, “Dude, c’mon. Hope is not a plan.” (Cue the Questrade logo.)

Perhaps he could sit down with Premier Jason Kenney.

What? Probably 90 per cent of Canada’s constitutional lawyers believed Alberta’s case had zero chance of success. Sure, the province had won a preliminary meeting in the Alberta Court of Appeal, but Ottawa won cases in Ontario and Saskatchewan, setting up the championship match in the Supreme Court. Based on its lone victory at home, however, the Kenney government went all in. (“Why have a back-up plan, bro? It’s in the bag!”)

For the UCP, however, hope springs eternal, even when the fiscal boat itself is springing leaks. This is not the first time the government’s grand strategy has relied on a hefty dollop of hope. In the spring of 2020, the UCP invested $1.5 billion in the Keystone XL pipeline, with another $6 billion in loan guarantees. It made the investment as the American election entered its primary phase. While Donald Trump, a pipeline supporter, was assured to be the GOP nominee, the democratic candidate was still to be decided. Many of those candidates were lukewarm about Keystone, and one in particular was vehemently opposed: Joe Biden.

We know what happened. Biden won and Keystone went down, taking with it, Alberta’s investment. For many governments, losing so much money frivolously would seem to be a major PR problem, but no fear: The UCP’s recent budget cleverly hides the loss of investment dollars as part of “the largest infrastructure budget to build things in the history of Alberta.” Voila, the sow’s ear is now a silk purse! Aren’t we all happy?

Still, hope prevails; witness the UCP’s relentless drive to ensure Alberta’s tax advantage; a.k.a., let’s have everything and never pay for anything.

Alberta already had a very low and competitive corporate tax rate when the UCP was elected in 2019 (12 per cent). This wasn’t good enough, however, so the government immediately lowered it to 11 per cent; then, in January 2020, to 10 per cent; and finally, in December, to eight per cent — far and away the lowest rate in Canada, all in the hope that foreign investors will come bearing bags of gold. Border inspectors thus far report no sightings.

To the extent the Kenney government actually does have something like a plan, it seems to involve selling off parks and mountains or privatizing public services, such as health care and, perhaps, post-secondary. (New UCP slogan: “If it doesn’t move, or isn’t moving too fast, sell it!”) But such dubious money-making schemes seem too like desperate hopes dressed up as a plan.

By far the UCP’s biggest hope, however, is that by 2023 voters will have forgotten the scandals, endless deceptions, petty meannesses, fiscal boondoggles, and cartoonish sideshows long enough to re-elect them. At the moment, evidence suggests this is a faint hope.

Trevor Harrison

Trevor W. Harrison is a professor of sociology at the University of Lethbridge and director of Parkland Institute, an Alberta-wide research organization, of which he was a founding member and first research director. Dr. Harrison is best known for his studies in political sociology, political economy and public policy. He is the author, co-author or co-editor of nine books, numerous journal articles, chapters, and reports, and a frequent contributor to public media, including radio and television.

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