Alberta's Financial Abyss . . . .

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Alberta's Financial Abyss . . . .

Dec 24, 2017 | 13:36 31 Perfecho, sad to hear you consider coming on here wallowing, always good to hear from you. By March of 2020 the NDP project the debt will $71 billion or $16473 per person. Ontario the most indebted non sovereign government in the world at present has $21841 of reported debt per person. So in less than 5 years the Alberta NDP will have accumulated roughly 3/4's as much debt per person as Ontario has over its lifetime. Quite an accomplishment(not)! As for how we got in this mess, very simple, using royalties to fund everyday expenses of government. If Albertan's had been willing and in my opinion smart enough to have implemented a sales tax 20 years ago and did a better job of managing spending this problem wouldn't exist today. Having said that the NDP have certainly made a bad situation far worse. Reply With Quote
Dec 24, 2017 | 13:44 32
Quote Originally Posted by caseih View Post
They would of had lots of reserves if quebec wouldnt have taken it all , ffs
Why blame Quebec for Alberta's mismanagement? LOL The equalization program is paid for with federal taxes collected in every province. Federal taxes still have to be paid regardless of how federal programs work. So Your argument is full of shit. Reply With Quote
Dec 24, 2017 | 13:53 33
Quote Originally Posted by Hamloc View Post
Perfecho, sad to hear you consider coming on here wallowing, always good to hear from you. By March of 2020 the NDP project the debt will $71 billion or $16473 per person. Ontario the most indebted non sovereign government in the world at present has $21841 of reported debt per person. So in less than 5 years the Alberta NDP will have accumulated roughly 3/4's as much debt per person as Ontario has over its lifetime. Quite an accomplishment(not)! As for how we got in this mess, very simple, using royalties to fund everyday expenses of government. If Albertan's had been willing and in my opinion smart enough to have implemented a sales tax 20 years ago and did a better job of managing spending this problem wouldn't exist today. Having said that the NDP have certainly made a bad situation far worse.
Sales tax would have been a good start. It will be interesting to see how Kenney cuts healthcare education and other programs if resource revenues don't improve. Alberta is in trouble and Kenney won't be able to do much about it. Reply With Quote
ajl
Dec 24, 2017 | 14:01 34
Quote Originally Posted by chuckChuck View Post
Critics Slam Alberta's New Royalty Review as Policy Disaster

https://thetyee.ca/News/2016/02/02/Alberta-Royalty-Review-Disaster/

"In another submission, the economist Mark Anielski reported how the province would have benefited if it had kept Lougheed's approach to a robust and healthy royalty regime.

"Had Alberta maintained a 30 per cent royalty rate on the share of the value of the oil and gas produced between 1971 to 2014, Albertans would have generated $471.4 billion in oil and gas royalties. Had 50 per cent of these royalties been invested in the Alberta Heritage Savings and Trust Fund with annual average return of five per cent per annum we would now have an investment account worth over $481 billion."

The current savings fund holds less than $20 billion." [Tyee]

Alberta's resources have been mismanaged for decades after Lougheed.

Classic left wing non think here. Reality is that Alberta would have produced much less volume during this period had royalties been kept at 30% because oil sands are relatively expensive to produce. By reducing royalties, oil sands became viable and people went to work and tax revenue followed. Then there is the quebec factor as others have pointed out. The Klein years were the best time in Alberta history. Thank you Ralph. Reply With Quote
Dec 24, 2017 | 14:24 35
Quote Originally Posted by ajl View Post
Classic left wing non think here. Reality is that Alberta would have produced much less volume during this period had royalties been kept at 30% because oil sands are relatively expensive to produce. By reducing royalties, oil sands became viable and people went to work and tax revenue followed. Then there is the quebec factor as others have pointed out. The Klein years were the best time in Alberta history. Thank you Ralph.
The oil sands have a special deal so I don't believe we would have produced less and even if we did we would still have some cheap congenital crude to sell.
IMHO its because of the likes of GDR ,LEP ,Hamloc that we are in this mess if you as good supporters of the cons would have been watching what was going on and held them accountable instead of making excuses for them ,we had one of the most arrogant cons Ken Kowalski , then Steve west ,for his boondoggle of elect deregulation,I could go on forever but I fail to see how the NDs could possibly fuckup worse than those assholes did Reply With Quote
Dec 24, 2017 | 14:37 36 Well, back again so soon...;-)
The wallowing refers to some bullying styles that if you don't agree or are in the right party, you are totally stupid...not really my type of conversation, however, Hammy, do find yours at least thought out and not just because of party lines. (Like Harper's budgetary 5.8 billion deficit of 2008-9...totally the fault of the recession, whoever the oil price fall totally Notely's fault...;-0 )
Yes , agreed on the accomplishments, however, had Prentice gotten in, don't think it would be very much different. And had the WR....think we would be little debt, but everyone in the province would be out of work. Agree about the "bad situation made worse", but do believe the ground work was laid...a later comment on oil sands...mismanagement again.....and that is why the wages and cost of business got to be a burden for those outside the oil patch. I remember Ralph's tax concession , another one, to them when his chief of staff, Peter Elzinga, became a lobbyist for Suncor.....racked with nepotism and corruption, but it was OK, because it was Ralph. (And I reiterate, I loved him too...at the beginning, but...) And I will vote for the first party, regardless of who, would bring in a sales tax...one of the fairest types of tax.
And that is why I dislike political parties....its all in or all out...and that doesn't work for me. There is good and bad in all, people and parties...

Anyways, have a great Christmas....I still live where I want to and am able to call life here a blessing...
Merry Christmas! Reply With Quote
ajl
Dec 24, 2017 | 15:27 37 Don't know why electrical deregulation is referred to as boondoggle. Granted there were hiccups along the way, but it is the main reason that power prices have been under 2 cents wholesale in AB recently. Something the Dippers are desperately trying to change as their 'green' energy is no near competitive. Deregulation brought a lot of power from cogeneration and other like technologies on line. There was a lot of vested interests that were rocked in the process and understandably they were not happy, but it has in general been a boon to the average consumer. Reply With Quote
Dec 24, 2017 | 17:02 38 Ahh, but we don't pay 2 cents....my actual power is 1/3 of my bill, the rest goes to carriers and providers, of which we, the province use to own.....and the power bill I just paid today, was closer to 4 cents for power alone (Epcor) and times 3 to get my actual power bill.
Did you not find it strange that Jim Dining was in the center of power deregulation government and then got to be Executive VP of TransAlta at pretty decent salary.....then trodden in on a white horse to replace Klein, but when that battle was lost, he had no commitment to Alberta...only wanted to be it's leader...much like Prentice. (As a side note, he has been a chair of Alberta's Clean Power Coalition)
So, could we have had continued with us being the share holders of a pretty dam good corp supplying power....but I remember my cheque for my share.....wasn't more than $200....which was used up on my first power bill..... Reply With Quote
ajl
Dec 24, 2017 | 17:13 39
Quote Originally Posted by perfecho View Post
Ahh, but we don't pay 2 cents....my actual power is 1/3 of my bill, the rest goes to carriers and providers, of which we, the province use to own.....and the power bill I just paid today, was closer to 4 cents for power alone (Epcor) and times 3 to get my actual power bill.
Did you not find it strange that Jim Dining was in the center of power deregulation government and then got to be Executive VP of TransAlta at pretty decent salary.....then trodden in on a white horse to replace Klein, but when that battle was lost, he had no commitment to Alberta...only wanted to be it's leader...much like Prentice. (As a side note, he has been a chair of Alberta's Clean Power Coalition)
So, could we have had continued with us being the share holders of a pretty dam good corp supplying power....but I remember my cheque for my share.....wasn't more than $200....which was used up on my first power bill.....
The deregulated portion of the bill is the generation side which has been declining. There are power pool flow through contracts in existence. Power pool pricing has been frequently lower than 0.02 in the past 5 years. The distribution portion of the power bill has always been and continues to be highly regulated partly because of natural monopoly reasons. That portion is rising and will continue to rise due to bureaucratic incompetence. Building wires to wind farms is one reason that is rising. Reply With Quote
LEP
Dec 24, 2017 | 18:44 40 My take is from the outside looking in, as I live in Saskatchewan. I don't doubt that the PC's did many things wrong and needed a house cleaning.

However, from what I have seen from Notley , she is very idealogical and arrogant. When faced with a revenue shortfall, I think government needs to try and find ways to curtail spending and, or find new revenue.

NOT ANNOUNCE THAT THEY ARE SIMPLY RUNNING A DEFICIT OF XX BILLION UNTIL THE PROJECTED PRICE OF OIL RETURNS AND ALL IS FINE AGAIN. Not saying there wouldn't be a deficit, but definitely not of the gargantuan proportions you are seeing. That is what I blame the Notley government for. Reply With Quote
Dec 24, 2017 | 19:07 41
Quote Originally Posted by ajl View Post
The deregulated portion of the bill is the generation side which has been declining. There are power pool flow through contracts in existence. Power pool pricing has been frequently lower than 0.02 in the past 5 years. The distribution portion of the power bill has always been and continues to be highly regulated partly because of natural monopoly reasons. That portion is rising and will continue to rise due to bureaucratic incompetence. Building wires to wind farms is one reason that is rising.
We will have to agree to disagree I was a board member during the fiasco,steve west changed the rules more often than a hooker changes clients In the end some of the reas decided to go it without translate and I don't think they were prepared for that one. At the time the liberal party said it was going to cost Albertans 17 billion $ which I thought was high but now I am not sure if they didn't under estimate. Trans a;ta was guaranteed 12.5% return so they went to Brazil and lost billions so came back here to get a rate rider until they were in the black again. We were paying about 5.7 then with transmission and other costs except distribution, now its 5.9 + dist+trans+riders .
Trans Alta was sold to utilicorp of Missouri then to some Irish co and nowepcor for energy some other co for billing power sold in huge blocks as to eliminate competition, and the saga goes on,a serious cluster duck.
And I liked Ralph to but him and his gov left a lot to be desired,rember the Ralph bucks. As for transmission lines for wind farms.? but transmission to fort mac to export power to USA is a reality.and again with a profit guaranteed by gov. I could ramble on but you won't listen any so why bother if you won't get your nose out of the con party ass. Reply With Quote
Dec 24, 2017 | 19:14 42 Those massive power lines were approved in 2012....and many still think it was to take power to the border for the gain of the power corps....and we get to pay.....but, I will admit, I really don't know.
LEP, this massive Alberta machine was out of control before hand....the ND's just kept it rolling and added their part...but it did keep people employed for the most part, yea...a lot of oil workers that made outlandish wages did lose theirs...and many in Calgary...but a correction was needed, not wanted. Have relatives, who seem to be good workers that kept on going with their drilling jobs, albeit at a lower rate, but....
We have a building we rent out in Nisku...luckily they stayed and kept going, found a way to make it work, where as before you could just about hang your shingle anywhere and use bodies that didn't deserve the rate they got.....and still, it amazes me, there are still buildings going up, even though there are a number empty,
Not sure how you compete in a world that continues to borrow money and goes deeper and deeper into debt, but that now seems the norm. Years ago, I thought this would all go to crap, terribly...and yet, somehow it just keeps going.
Anyways, been a slice....obviously some are on holidays so I got off lightly, but its time for my favorite service of the year.
Have a Wonderful Christmas, and wishing we all find what makes us happy in the New Year. Reply With Quote
Dec 24, 2017 | 21:06 43
Quote Originally Posted by perfecho View Post
Those massive power lines were approved in 2012....and many still think it was to take power to the border for the gain of the power corps....and we get to pay.....but, I will admit, I really don't know.
Remember the lie that the power lines were needed to prevent power outages in a growing Calgary? Then Joe Anglin went into the schematics and pointed out that there was no way it was going into Calgary from Langdon as the wire shown in their plans could hardly carry any power. Caught out in another lie - as Joe used to say - the typical PC MLA was dumber than your average monkey. Reply With Quote
GDR
Dec 24, 2017 | 21:32 44
Quote Originally Posted by grassfarmer View Post
Remember the lie that the power lines were needed to prevent power outages in a growing Calgary? Then Joe Anglin went into the schematics and pointed out that there was no way it was going into Calgary from Langdon as the wire shown in their plans could hardly carry any power. Caught out in another lie - as Joe used to say - the typical PC MLA was dumber than your average monkey.
Original route was to go through our place and yes the bs they spewed about the next generation in calgary needs the power or they will be left cold and dark in winter. Was a huge attempt to guilt people into signing. Altalink was just one big lying machine.

As for the privatization of utilities, in theory it seems foolish but private industry is way more efficient at running any business. Partly because of bureaucracy that comes with government but also all suppliers & contractors have separate and higher prices for anything government. Reply With Quote
Dec 24, 2017 | 22:10 45
Quote Originally Posted by GDR View Post
As for the privatization of utilities, in theory it seems foolish but private industry is way more efficient at running any business. Partly because of bureaucracy that comes with government but also all suppliers & contractors have separate and higher prices for anything government.
Depends on how the environment the private industry operates in is set up and governed. Remember the genius system of the AESO auctions whereby the power generating companies had to bid in their offers to supply power over each time period by Dutch auction. So as an example a hydro company might offer in 30% of the requirement at $0 per megawatt hour because they couldn't store the power (this actually happened on occasion) Then the coal generated operators would offer 40% of the requirement at $10, then some other generator would offer in 25% of the requirement at $50 leaving only 5% of the supply to fill - which could be done by say nuclear generation - at $90 megawatt hour. So any sensible person would add these up and average the costs out over the total supply (100%) and that would be the cost the consumer would pay - but not in Alberta - they turned around and paid all the generators the $90 rate for all their production - even the guys that offered power at zero cost! You couldn't make this stuff up it is so crazy - even the mafia wouldn't be as bold as to try this kind of extortion but it was all approved and allowed to happen on the PC's watch. This is why Alberta had some of the most expensive electricity in North America - straight into the pockets of Enmax and Altalink and their like - because their directors or spouses were often high up members of the PC party. Reply With Quote
Dec 24, 2017 | 22:34 46
Quote Originally Posted by grassfarmer View Post
Depends on how the environment the private industry operates in is set up and governed. Remember the genius system of the AESO auctions whereby the power generating companies had to bid in their offers to supply power over each time period by Dutch auction. So as an example a hydro company might offer in 30% of the requirement at $0 per megawatt hour because they couldn't store the power (this actually happened on occasion) Then the coal generated operators would offer 40% of the requirement at $10, then some other generator would offer in 25% of the requirement at $50 leaving only 5% of the supply to fill - which could be done by say nuclear generation - at $90 megawatt hour. So any sensible person would add these up and average the costs out over the total supply (100%) and that would be the cost the consumer would pay - but not in Alberta - they turned around and paid all the generators the $90 rate for all their production - even the guys that offered power at zero cost! You couldn't make this stuff up it is so crazy - even the mafia wouldn't be as bold as to try this kind of extortion but it was all approved and allowed to happen on the PC's watch. This is why Alberta had some of the most expensive electricity in North America - straight into the pockets of Enmax and Altalink and their like - because their directors or spouses were often high up members of the PC party.
AMEN but you won't make those dyed in the blue toys believe it. Reply With Quote
GDR
Dec 24, 2017 | 23:53 47
Quote Originally Posted by grassfarmer View Post
Depends on how the environment the private industry operates in is set up and governed. Remember the genius system of the AESO auctions whereby the power generating companies had to bid in their offers to supply power over each time period by Dutch auction. So as an example a hydro company might offer in 30% of the requirement at $0 per megawatt hour because they couldn't store the power (this actually happened on occasion) Then the coal generated operators would offer 40% of the requirement at $10, then some other generator would offer in 25% of the requirement at $50 leaving only 5% of the supply to fill - which could be done by say nuclear generation - at $90 megawatt hour. So any sensible person would add these up and average the costs out over the total supply (100%) and that would be the cost the consumer would pay - but not in Alberta - they turned around and paid all the generators the $90 rate for all their production - even the guys that offered power at zero cost! You couldn't make this stuff up it is so crazy - even the mafia wouldn't be as bold as to try this kind of extortion but it was all approved and allowed to happen on the PC's watch. This is why Alberta had some of the most expensive electricity in North America - straight into the pockets of Enmax and Altalink and their like - because their directors or spouses were often high up members of the PC party.
Could very well be as you described, I don't know but isn't that exactly the left wing social system in a nutshell?? Pay everyone the same no matter the need or contribution!! You should be happy with that! LOL.

Merry Christmas anyhow, Santa is on his way. Reply With Quote
Dec 25, 2017 | 09:05 48
Quote Originally Posted by Horse View Post
The oil sands have a special deal so I don't believe we would have produced less and even if we did we would still have some cheap congenital crude to sell.
IMHO its because of the likes of GDR ,LEP ,Hamloc that we are in this mess if you as good supporters of the cons would have been watching what was going on and held them accountable instead of making excuses for them ,we had one of the most arrogant cons Ken Kowalski , then Steve west ,for his boondoggle of elect deregulation,I could go on forever but I fail to see how the NDs could possibly fuckup worse than those assholes did
Horse, you make a lot of judgements on my political leanings. First off did I support Ralph Klein? Yes initially the cuts in spending and the lowering of the debt were very positive. Near the end of his tenure me and the PC's parted ways. I never agreed with privatizing the electrical system(to small of a market for real competition) and near the end of Ralph's days he would just throw money at a problem without thinking. Now of course Horse, you would think the fact that I have voted Wildrose ever since to even be worse. First and foremost I want a financially responsible government. The PC's weren't, the NDP are not. But I am also realistic. I realize that there is no way we can lower government spending enough now to balance the budget nor should we. So today there is really no party with a platform that I agree with totally. Imo the province would be much better off with a sales tax than a carbon tax. The present carbon tax does nothing to help the debt and is just used by the NDP to buy votes. Also as a farmer I realize I am dependant at present on fossil fuels and that the carbon tax will disproportionately cost me money with no perceived benefit. While a sales tax would cost me money it would at least go towards health care and education. Regardless, Horse I hope you and your family have a Merry Chistmas Reply With Quote
Dec 25, 2017 | 09:51 49 All politics aside. MERRY CHRISTMAS everyone. Reply With Quote
Dec 25, 2017 | 13:07 50
Quote Originally Posted by GDR View Post
Could very well be as you described, I don't know but isn't that exactly the left wing social system in a nutshell?? .......You should be happy with that! LOL.
No, I've never been one to like the average person being robbed regardless of whether it's a "left wing social system" or deregulated Corporate Communism. I oppose both of them vehemently. Reply With Quote
Dec 25, 2017 | 13:13 51
Quote Originally Posted by chuckChuck View Post
Why blame Quebec for Alberta's mismanagement? LOL The equalization program is paid for with federal taxes collected in every province. Federal taxes still have to be paid regardless of how federal programs work. So Your argument is full of shit.
Actually your argument is right full of shit . You dont think its odd that quebec has collected every year since inception ??? Its called abuse of the system Reply With Quote
Dec 26, 2017 | 08:51 52
Quote Originally Posted by chuckChuck View Post
Critics Slam Alberta's New Royalty Review as Policy Disaster

https://thetyee.ca/News/2016/02/02/Alberta-Royalty-Review-Disaster/

"In another submission, the economist Mark Anielski reported how the province would have benefited if it had kept Lougheed's approach to a robust and healthy royalty regime.

"Had Alberta maintained a 30 per cent royalty rate on the share of the value of the oil and gas produced between 1971 to 2014, Albertans would have generated $471.4 billion in oil and gas royalties. Had 50 per cent of these royalties been invested in the Alberta Heritage Savings and Trust Fund with annual average return of five per cent per annum we would now have an investment account worth over $481 billion."

The current savings fund holds less than $20 billion." [Tyee]

Alberta's resources have been mismanaged for decades after Lougheed.
Anyone care to debate that this post is wrong? Good luck with that!

Another great question, what would the Cons have done differently the past 2 years? They certainly never did anything to prepare for the inevitable crash in pittance of royalties rec'd even when times were good.

Its pretty easy to glaze over the problem and make up fairy tales of what another could be doing. Certainly a defense mechanism to avoid reality. Reply With Quote
LEP
Dec 26, 2017 | 11:28 53
Quote Originally Posted by tweety View Post
Anyone care to debate that this post is wrong? Good luck with that!

Another great question, what would the Cons have done differently the past 2 years? They certainly never did anything to prepare for the inevitable crash in pittance of royalties rec'd even when times were good.

Its pretty easy to glaze over the problem and make up fairy tales of what another could be doing. Certainly a defense mechanism to avoid reality.
Actually, it is a huge fallacy that you can significantly increase royalties (taxes) and have no change on output. So this study is a fairy tale. A complete myth.

Not saying royalties shouldn't have been higher, but to look back and say if we only doubled royalties we would have had double the revenue is complete bunk. Reply With Quote
Dec 26, 2017 | 13:20 54 completely mismanaged doesn't help the situation. Giving it away doesn't help albertans either. The PC's lost their way because it was a desperation vote by a lot of very pissed off Albertans of complete ineptness on the PC part. Redford was the final straw. Reply With Quote
Dec 26, 2017 | 14:01 55
Quote Originally Posted by caseih View Post
Actually your argument is right full of shit . You dont think its odd that quebec has collected every year since inception ??? Its called abuse of the system

Think the equalization formula is rigged against the West and slanted toward Quebec? Think Quebec income exempts certain lucrative industries? Only way to really eliminate the problem is to succeed from the country, as in Adios Amigos. Reply With Quote
Dec 26, 2017 | 18:16 56
Quote Originally Posted by sumdumguy View Post
Think the equalization formula is rigged against the West and slanted toward Quebec? Think Quebec income exempts certain lucrative industries? Only way to really eliminate the problem is to succeed from the country, as in Adios Amigos.
Wouldnt that be a sweet moment Reply With Quote
Dec 26, 2017 | 20:26 57
Quote Originally Posted by tweety View Post
completely mismanaged doesn't help the situation. Giving it away doesn't help albertans either. The PC's lost their way because it was a desperation vote by a lot of very pissed off Albertans of complete ineptness on the PC part. Redford was the final straw.
I think Tweety your not going far enough back in history. The oil price collapsed in 1985 and Alberta started to accumulate debt. If I remember correctly having lived through those years in Alberta, the royalty regime was first modified under Don Getty in an attempt to attract the oil development dollars back to Alberta that had left under the NEP. As for Ralph Klein he was a victim of his own success. His tax changes that quickly increased oil developement and attracted 10's of thousands of workers to Alberta put a strain on public services like health and education. The PC's didn't react quick enough and didn't make the tax changes necessary to fund them. As for your assertion on royalties at 30%, the present royalty regime peaks at 40% on conventional oil. The royalties on oilsands bitumen are far lower, can and should these be changed, good question. To a some extent tax measures implemented by government are a reflection of the opinions of the populous, hence the lack of a sales tax in Alberta. As for the carbon tax, Albertan's didn't get a chance to vote on that yet, that will occur in the next election. Reply With Quote