Alberta Provincial Politics

[Unknown User]

Nope. Character is manufactured. Both leaders suck because of what they have done. Smith demonstrated poor judgement with the 2014 floor crossing and pointless Soverienty Act. Notley increased public sector headcount during a recession, raise corporate income taxes, imposed more restrictive labor legislation, incurred $2B on PPAs handed back to the Balancing Pool and another $2B on rail for oil contracts. Political leadership in general was been awful.since the rise of social media.

What is your opinion on R-star?

 

[DougB]

What is your opinion on R-star?

Bad idea and at this point only an idea.

 

[Unknown User]

Bad idea and at this point only an idea.

I guess we will have to disagree that a program that DS has advocated for for years and has implemented a pilot program +under a different name to be clever) for since she's been in office is more than an idea. But it perfectly illustrates why character matters. Do I believe DS will implement every idea she's spewed over the last 5 years? No, half of them probably aren't allowed by the charter, but I am sure that whichever programs she does implement won't be be beneficial to anyone but private interests (enriching her friends) and special interest groups (TBA) that got her I to power in the first place

 

[DougB]

Character is manufactured and difficult to assess beyond examining an individual's actual track record in decision making. Neither leader has demonstrated competence.

As bad as TBA may be, enriching the likes of AUPE, ATA, UNA would be worse. TBA is a flash in the pan that will be easy to screw over.

The best way to clean up politics would be to severely constrain government's ability to fund anything other than capital (the accounting definition of capital, not crap like "human" or "social capital") from long term debt, and banning collective bargaining with monopoly employers like government. That would force prioritization and eliminate the noise of over-emphasizing public sector employees as stakeholders.

 

[darwink]

Smith has been signing contracts with raises for unions. The last raises for those unions were under the PCs after Redford and before Prentice.

I’m not sure your conclusion matches with reality.

 

[Unknown User]

Smith has been signing contracts with raises for unions. The last raises for those unions were under the PCs after Redford and before Prentice.

I’m not sure your conclusion matches with reality.

Jeromy Farkas, surprisingly, put it pretty succinctly.

We supported bringing the parties together because we thought we were going to get the best of both worlds. We thought we were getting Wildrose financial responsibility and transparency married with PC competence and progressive social values. Instead, we got the worst. The big spending and corruption of the PCs, combined with some extreme views of the Wildrose.

 

[darwink]

I’d posit that the Wildrose liked the idea of fiscal responsibility, but never were serious about it. It was a gimmick party. Just limit spending growth to inflation and population growth and things would be fine. Just delay every hospital project, school and road for a year and everything would be fine. A central thought was that somehow with the Wildrose in charge we could get all the same stuff and the same services but for less because they were better.

It is pretty much the thought behind the Alberta soveriegnty act. The federal government will take us seriously if we have the act and it is us in government. Then when they achieve typical outcomes they congratulate themselves on achieving a historic outcome. It is typical populist claptrap.

 

[artvandelay]

I was preparing myself to vote NDP for the first time ever until they came out with their fiscal plan with this 38% corporate tax increase. I had hoped that them bringing in Hirsch would have mitigated the financial and economic naivety that is the NDP's main weakness. Things are going very well economically right now, why even take the risk of making fundamental fiscal changes?

They did the same thing in 2015 - a 20% increase in the tax rate that did not actually raise revenue. Now they are proposing the same thing again expecting a different result - it's absurd.

Now it's a choice between holding my nose and voting UCP or going with the poor, also-ran Alberta Party.

 

[darwink]

a 20% increase in the tax rate that did not actually raise revenue.

have to account for an oil price collapse in there. Anyways, Leach from UofA calculated a change in corporate tax rate changed the break even point for a new oil sands project by 30 cents or so a barrel.

Trying to wish away that oil prices rules everything for us is folly.

 

[artvandelay]

have to account for an oil price collapse in there. Anyways, Leach from UofA calculated a change in corporate tax rate changed the break even point for a new oil sands project by 30 cents or so a barrel.

Trying to wish away that oil prices rules everything for us is folly.

An odd metric to measure a tax that affects every sector of the economy.

Corporate income tax rates have an immediate and material impact on after tax cashflows and consequently the IRR for every capital investment project in the province. Capital is mobile, and capital budgeting does not occur in a vacuum - so an increase such as this will have a destructive impact on capital spending. You are correct in that the extent of this impact can be masked or magnified by wider economic trends, however the impact on IRRs is simple math.

 

[darwink]

the change in the hurdle rate is just pretty small, compared to the changes the same investments have to mitigate against with interest rates, exchange rates, and general inflation.

Though I would prefer corporate tax rates to be zero, it is an odd thing to hold out as a deal breaker imo.

 

[artvandelay]

the change in the hurdle rate is just pretty small, compared to the changes the same investments have to mitigate against with interest rates, exchange rates, and general inflation.

I don't believe the provincial government has much control over interest rates nor inflation. These are also generally constant from jurisdiction to jurisdiction - so not really relevant to the discussion whatsoever.

Though I would prefer corporate tax rates to be zero, it is an odd thing to hold out as a deal breaker imo.

In chatting with some finance folks over the long weekend who are also fed up with the UCP, sounds like this may be a dealbreaker for a fair few in Calgary. It's actually the only time I've heard the election come up in conversation. Odd!

 

[ByeByeBaby]

I was preparing myself to vote NDP for the first time ever until they came out with their fiscal plan with this 38% corporate tax increase. I had hoped that them bringing in Hirsch would have mitigated the financial and economic naivety that is the NDP's main weakness. Things are going very well economically right now, why even take the risk of making fundamental fiscal changes?

They did the same thing in 2015 - a 20% increase in the tax rate that did not actually raise revenue. Now they are proposing the same thing again expecting a different result - it's absurd.


Corporate income tax rates have an immediate and material impact on after tax cashflows and consequently the IRR for every capital investment project in the province. Capital is mobile, and capital budgeting does not occur in a vacuum - so an increase such as this will have a destructive impact on capital spending. You are correct in that the extent of this impact can be masked or magnified by wider economic trends, however the impact on IRRs is simple math.

Okay, what would you think if the NDP instead committed to having the lowest corporate tax rates in the country? Shouldn't that cause a massive economic boom with the vaunted mobility of capital?

Trick question, of course, it's the exact same policy. You can call the corporate tax rate going from 8% to 11% an increase of 3% or a 38% increase or keeping the tax rate below the 11.5-12% most provinces charge (higher in Atlantic Canada).

 

[UrbanWarrior]

Things are not looking up for the good guys Every opinion poll since the debate shows a UCP lead.

 

[Surrealplaces]

Things are not looking up for the good guys Every opinion poll since the debate shows a UCP lead.

My gut feeling is that the UCP will win this election, but it'll be close. As much of a downer as it could be for some, it still marks a big change in the Alberta political landscape. Whether one prefers the NDP or UCP, it's always better to have a close election rather than a usual landslides we've had so many times in the past. It'll hopefully keep the UCP in line, and also send a message. Calgarians might like fiscal conservatives, but they don't necessarily like social conservatives. These next few years are going to be interesting.