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Comments Effecting Canadian Events – Ken McGregor

Alberta : Is Diversification Still On The Menu

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With all political parties beating up the PC government on Health Care, has the idea of diversifying Alberta’s economy taken a back seat at a time it should be out front vigorously being promoted?

As far back as 1930, after going through the great depression, the idea of diversifying our economy into different industries to smooth out the boom and bust started to take root. The Alberta Government learned in order to start on the long path of diversification they would have to tie it to our main industries, which in Alberta was our resource sector namely natural gas and Oil. They also realized that in order to attract investment they would have to create an environment for both business and workers. This would mean creating a competitive tax advantage, good power sources, transportation systems,training for skilled labour, Health care etc. They also needed to revise regulations making it easier to trade internationally.This later became known as the “Alberta Advantage”. This brings me to the second question ,do we still have the Alberta Advantage or is it being eroded away?

After going through the volatility of 2008, it looks like Alberta is still heavily depended on oil and gas with very little progress being made to diversify the economy over the past 10 years.Β  With the gas revenue all but drying up due to shale gas recovery and the US starting to move its way off oil, our resource revenue has shrunk by billions leaving us once again in a deficit position using our savings to live on. It appears the government of the day just got to complacent with the good times and took diversity of the menu. They thought they were on auto pilot and could sit back taking it easy. They were wrong.

Over the past years the government has been to preoccupied with pleasing Albertans by promoting health care and education, so much so, that it has engulfed over 64% of the budget today, when they should have been giving more thought to the struggling cities trying to keep up with the huge costs of building infrastructure, the very infrastructure needed to attract business, skilled labour and professionals to diversify the province. Presently Calgary can’t get enough money together to build a badly needed tunnel for the airport. The province is also trying to unload a million dollar maintenance expense of the Deer Foot trail on the city knowing it’s just scraping by. With all the cities problems ,still no money in the 2011-2012 budget but plenty for health care.

The government has also fallen asleep promoting our Oil Sands. They have allowed Alberta’s image to be tarnished world wide without putting up any real vigorous defence. They had a decade to get their act together and avoid the environmental hoopla but missed the boat. Having this derogatory image is not what business wants to invest in. If that’s not bad enough we now have the opportunity to sell billions of dollars worth of oil to China, but we don’t have a pipeline going to the west coast to get the oil to port. Knowing for decades we had all this Oil Sands being developed with no way to get it to world markets is a clear lack of vision and political will.

The government has clearly dropped the ball on diversifying Alberta. The Alberta Advantage is disappearing. We need to increase our focus on gaining world access for our resource products.We also need more thought into producing oil base products, building on our strengths, to keep the jobs in Alberta. The government has to put diversification back on the menu and get our economy MOVING. Without more resource revenue, the only thing on the menu for Albertans is HIGHER TAXES.

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Written by Ken McGregor

March 12, 2011 at 5:48 pm

One Response

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  1. I think the push to make the oil sands development acbaontucle for the environmental impacts is excellent. However, I agree with Mr Bishop above conservation should lead the way. The American and world public should fully understand their complaint and for those that are still driving, the hypocrisy of their environmentalism. I have found that while extraction of a barrel of oil requires emission of 80 kg of CO2, the burning of that barrel of oil will yield 530 kg of CO2. If you want your SUV, consider the alternative costs of your war in Iraq. Maybe you should do a environmental assessment of that mess! Americans have among the lowest fuel taxes for the G8 countries and the per capita fuel use is the highest. In Alberta we think that it would be entirely appropriate if Americans would pay an environmental fuel export surcharge that could be used to lower our carbon footprint.


    December 12, 2012 at 1:45 pm

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