The common story is “Alberta doesn’t have an income problem. It has a spending problem.”
That wasn’t always the case. In fact, as little as 20 years ago, our provincial government actually spent less per person than other provinces in Canada. For those who might remember, that was after former premier Ralph Klein’s scorched earth policies getting government costs in line.
Depending on who had their proverbial ox gored or didn’t, those were the good old days. Back then, civil servants were axed left and right. Government unions cried. Average Albertans, not on government payrolls, not having gold-plated pensions and benefits, mostly shrugged. For them, it was hard enough keeping up with admittedly cyclical but well-paying oilpatch jobs.
It was all made worse by governments at all levels getting in the act and hiring and spending freely. Finally, with the cuts, other industries and small and medium business could sort of keep up.
Then came the dot.com crash of 2000. Then the financial crisis of 2008. Then the long overdue “other shoe” finally dropped. Oil price wars for the past five or six years have now devastated over rich oilpatch jobs. Here we are today.
This time around, it’s once again civil servants, from office workers in the provincial government, to medical workers, to teachers and the bloated administrations that support them. The numbers don’t lie. From being a low spender per capita decades ago, our provincial government is now the biggest spender per capita in Canada.
That said, are our schools graduating the best trained students in Canada? Do we have the shortest wait list for medical care? The longest life expectancies? Are our plumbers and electricians the best? Teachers the top-ranked in Canada?
Does a house cost so much more in Alberta than in New Brunswick because Alberta houses are built so much better by better builders? Do you see better news stories because Alberta journalists write so much better? Is your Alberta breakfast bunwich so much better than what they get in Ontario?
Or is it just a smoke and mirrors thing?
As we too often hear from politicians, if you want good people, you have to pay for them. With this in mind then, one would think our own bureaucrats, the guys and gals pushing paper around, would likely be among the most efficient and capable in the world. Due to their high pay, of course!
And the really interesting side effect of having such capable people is that, with all these brilliant and capable people running things, our per capita spending should actually be among the lowest in the world.
It is indeed smoke and mirrors. Simply, high wages in one place lead to higher wages in another place. Higher wages end up meaning higher prices.
Right now, today, we shouldn’t begrudge government payrolls and spending. Last week’s provincial budget is what keeps a big part of the Alberta economy running right now.
One day, spending must, and will, come down to earth. How many will be around to see that is still the big question.