Alberta is now Debt Free.

Written By: Dr Caleb
Date: 2004-07-12 10:55:00
<a href="/article/105557633-alberta-is-now-debt-free">Article Link</a>

Liberal Leader Kevin Taft said there's no point to having a surplus when Albertans walk into crowded hospitals and classrooms and drive on crumbling roads. New Democrat Brian Mason said the Klein government doesn't deserve credit for the windfall because oil and gas price increases guaranteed the surpluses regardless of how the Tories steered the economy. The Canadian Taxpayers Federation has said the surpluses show Albertans are grossly over-taxed and that rather than reward taxpayers, Klein has chosen to instead give double-digit pay increases to public sector workers. <a href='http://www.canada.com/news/national/story.html?id=c985b82b-c760-426a-b7eb-5b09550f63de'>Story Link</a> Dr. C: It's been a long hard road for Albertans. We've had to put up with cuts to almost everything imaginable, from Roads to user fees to increases in property taxes. Does this mean that the provincial budget can now be increased by 7 or 8 billion a year? That'll buy a lot of Health Care!

Someone explain this to me: how can a province so stinking rich not afford more social programmes? How with such a healthy financial outlook can King Ralph be flirting with the idea of user fees or premiums in health care?

A user fee for health care will keep Alberta debt-free, that's why it's a good idea. Any product or service that can be consumed without a direct personal payment will be in short supply, and expensive in terms of the taxation required to provide it. Water was supplied free to people in some jurisdictions in North America because it was argued that water was essential to life and therefore an absolute human right that people shouldn't have to pay for - the waste was enormous. When those same people were then charged a miniscule amount for their water - consumption dropped right off, even though they still only paid a fraction of its market value. It's human nature.

Someone explain this to me: how can a province so stinking rich not afford more social programmes? In the 80's, the Getty Government spent like a drunken sailor when the fleets' in. They based the budget on the revenues generated if the price of oil was $25 per barrel, when historically the price had not been that high in many years. It was hovering between $15 and $18 throughout the 80's. The NEP in the 70's and 80's took it's toll on the economy too. That left Alberta $23 billion in debt. In the 'Belt Tightning' of the 90's, when Klein first appeared, he slashed everything. Government services, payments to the cities, road repairs (infrastructure spending) - nothing was sacred. Wings of hospitals and entire hospitals closed. Everyone has paid $34.00 (single adult) per month in healthcare premiums as long as I can remember, so it's not a new thing. He insisted that the price of oil be lowballed ($18 - $20 a barrel predictions) and made it Alberta law that a percentage of the surplus was to go toward eliminating the debt, plus a minimum yearly payment towards the debt. That's repaid those $23 billion in less than the 15 years predicted. I for one expect that this extra revenue will now go back into the programs and services cut during the 90's.--- "History does not repeat itself, but it does rhyme" Mark Twain 
"The greatest price of not participating in politics is being governed by your inferiors." Plato

Too bad Prime Minister Lougheed of the Republic of Alberta fought the NEP so hard. The country would have been debt-free by 1990 if we kept it, and it probably would have helped NWT, Sask & BC also.

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"These Yankee politicians are the lowest race of thieves in existence." - Sir John Sparrow Thompson

And don't forget, CAP's plan could easily have gotten the entire country out of debt in the same time-frame, without cutting services.

Congratulations Alberta! Are we to understand you can now afford to build your private health care system? ;-)

Alberta is not debt free. What Ralph has done is put aside an amount equivalent to the provincial debt, to be applied in ten years. To pay it off earlier would incur penalties of some kind. So our Ralphy is not quite telling it like it is. What should be asked now, is the money put aside in an unbreakable trust? Or can it be used between now and then, and suddenly not be there?--- RickW

I smell election.

This is how politicians twist the truth a little (?) when they want to go for another mandate.

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"Arrogance in Politics is unacceptable"
Jim Callaghan
Minden, Ontario
705-286-1860
www.misterc.ca

Yep! I read something that Ralph muttered about "fire in the belly". With his popularity though, I do not understand why he felt it necessary to lie to his adoring public. Could be some issues in Alberta that we in TROC don't know about.....?

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RickW

As much as I disagree with charging for things like water, I can't ignore the fact that in encourages people to use resources many times more eficiently. It's why I support higher taxes on gasoline. Although such taxes would be regressive, even the poor could use less or get better milage cars and therefor pay less. Or they could take public transit, if available. There is the inevitable bell curve of effectiveness. We need to find it. Being poor doesn't mean you should get breaks for being wasteful! However, charging fees for things such as healthcare is not always the best solution. They tried the same thing in Australia and something called "bulk-billing" has come into force. This is where the doctors just don't charge the fee and still collect the government portion. Doctors that do this are at a competitive advantage to docotors that don't charge. --- "What is the nature of your thoughts, gentlemen?" - Pierre E. Trudeau

Rick,

You are correct, Alberta will still have debt, but with interest rates where they are it would be ridiculous to pay it off early and pay the penalties on it which would be more then the interest. Here is a quote from the Alberta website:

The $3 billion will be set aside in the Debt Retirement Account by March 31, 2005 to make all remaining debt payments as they become due. Legislation to be introduced in the next session will ensure the account can only be used to pay off the debt.

So they will inact legislation to make sure that it cannot be used for anything else.

But essentially Alberta no longer needs to worry about putting large amounts of money into debt servicing, because it will be completely serviced in the 2005 budget.

"I for one expect that this extra revenue will now go back into the programs and services cut during the 90's."

Don't hold your breath, Doc.

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"Arrogance in Politics is unacceptable"
Jim Callaghan
Minden, Ontario
705-286-1860
www.misterc.ca

And given us magical pixies in the bargain!

Yup. All the extra cash is going straight into the pockets of Ralph's employers... Er... Campaign supporters... Er... Corporate buddies.