Over the past 8 years I have created over 300 blog posts on Albertarecessionwatch.com and Abpolecon.ca beginning with “Redwater court decisions sides with lenders,” on 21 May 2016. The decision in favour of Grant Thornton LLP, a receiver tasked by ATB Financial to settle Redwater’s bankruptcy to ensure repayment to ATB, was to figure in eight further posts. Eventually, the Alberta Energy Regulator and the Orphan Well Association went to the Supreme Court of Canada where in January 2019 the Court found the polluter pay obligations of the oil company trumped claims under the federal Bankruptcy and Insolvency Act. Following the case reinforced for me the importance of an impartial judiciary and its role in adjudicating claims brought by governments, citizens and corporations. What follows is a mini-review of the last eight years.
Budgets
Another area I have focused on has been public finance, including budgets and changes to credit ratings. Budgets are central to what governments do. My first dive into budget matters came in May of 2016 when I recounted the election post-mortem hosted by the University of Alberta hosted by the Institute for Public Economics.
While there was not a consensus among speakers about how to get to balanced budgets and who should pay higher taxes, there was certainly unease among panelist about the debt build-up. Noted was how quickly the DBRS rating agency downgraded the province’s credit rating to AA (High). Some panelists were dismayed that the government had no clear plan or time frame to achieve balance on an operating side, let alone eliminating borrowing for capital. One panelist expressed worry about a flight of capital from the province as a result of tax changes at the highest marginal rate and corporate tax rates.
These issues would continue to repeat annually throughout the 2016-2024 period. Today, while Alberta’s debt is beginning to be paid back and credit ratings are beginning to raise, the province is not out of the woods. Capital flight would continue to be a story from the opposition and business communities, Alberta’s economy government finances were decimated by low oil prices which drive so much of Alberta’s gross domestic production.
Executive Compensation
I also scrutinized executive salaries under the NDP which were forzen or rolled back but are now on the rise under the UCP. At a recent public accounts meeting, Marlin Schmidt read into the record about the Finance Minister approving variable pay for executives at the Alberta Electrical Systems Operator (AESO) despite being violation of the Reform of Agencies, Boards, and Commissions Compensation Act which became effective in May 2016. This Act was eventually repealed by the UCP government who favoured executives over the general work force. Schmidt’s disclosures touched on salary or contract adjustments taking place in the key months before the May 2023 election. Executives rewarded between May 2022 to March 2023 worked at the Alberta Teachers’ Retirement Fund, the Local Authorities Pension Plan, the AESO, the presidents of Olds College. the universities of Lethbridge, Mount Royal, and Athabasca.
FOIPP
Another feature of modern government is the appalling abuse of freedom of information legislation to stymie researchers (media, partisan and academic) from helping the public understand what advice they are paying public servants for. The decay of this type of legislation allows both public servants to obscure the basis on which public policy and the public interests are determined. I will be taking this issue further based on a recently received request on the mandated investigation of an Alberta Revenue Agency. Virtually all the material was deleted except for names of public servants, but not their phone numbers. It is frightening to know that the office phone numbers of public servants are “personal” rather than public.
Provincial Agencies
Over the course of the past eight years, I have written critically about public agencies, in particular ATB Financial and the Alberta Investment Management Corporation (AIMCo). For ATB, as with any “bank-like” institution, it is the provision for credit losses that drive most of profit or loss. ATB continues to do a very poor job on showing its sectoral exposures although it does disclose that its two biggest business segments are the risky oil and gas industry and commercial real estate. In fact, ATB’s loan book for oil and gas and commercial real estate has grown to $13.9-billion at 31 March 2024 from $9.5-billion at the end of March 2019. This 46 per cent increase compares with 9.1 per cent increase in net loans over the same period.
Meanwhile, over at AIMCo, there was the management of the Alberta Growth Fund, a devious way to fund struggling oil and gas companies all amazingly under the NDP’s watch. But the UCP was not hands-off employee pensions as the former finance minister Travis Toews tight-fisted bargaining posture did not appear to apply to executives.
Whither Alberta Democracy?
One of the complaints that I would hear privately from business people during the Notley inter-regnum was the lack of consultation. This was driven by business suspicion about some of the badly needed reforms in labour legislation which heavily favoured business. If the NDP didn’t listen to business, the UCP made it a stock in trade not to consult certain groups before important policy shifts. Failure to consult showed up in Bill 19 which handed AIMCo back monopoly investment powers for public pension plans which had been removed by the Notley government. This resulted in the movement of over $20-billion in teachers’ retirement assets from the Alberta Teachers’ Retirement Fund as well as employers’ contributions to the Workers Compensation Board. It was not only employees who were not consulted as the Smith government introduced significant changes to municipal elections and municipal election financing again without proper consultation. My interview with Professor Jared Wesley in May of this year provides a good primer on the drift toward authoritarian government.
I also conducted conversations with notable Albertans including Professor Lori Williams, Lindsay Tedds, and Trevor Tombe, Dr. Ruben Nelson, and Robert Bhatia in early 2023.
More recently, I have become alarmed at the establishment of a provincial police force under Bill 11. Euan Thomson has reported efforts by big-city police chiefs to shape public opinion to form a coalition to advocate publicly for the United Conservative Party drug policy with an explicit time frame “before the May election” in 2023.
I wrote at the end of May
Recent directions to University of Calgary and University of Alberta presidents through media comments to crush dissent on campuses should serve as a warning of the dangers of centralized power which increasingly controls the police. If you don’t feel safe on campus to express dissent on international issues, how will police behave when large protests against the provincial government happen on campus or at the legislature?
Equally troubling was the challenge of the independence of the Crown Prosecution Service in the handling of the findings of the ASIRT investigation into the monitoring and surveillance of former NDP environment minister Shannon Phillips. In a letter to the Phillips’ lawyer, the Alberta Serious Incident Response Team (ASIRT) stated the provincial prosecution service has declined to take the matter to court even though ASIRT determined there were “reasonable grounds” to believe two Lethbridge police officers had committed criminal offences. This action has been taken even before ASIRT has publicly reported on an event brought to light by a freedom of information request submitted by Phillips in 2020. The ASIRT investigation was quickly launched when the story finally broke in March of 2021. Phillips has since resigned her seat effective 1 July due to harassment and disinformation.
Sabbatical?
There are several pieces I am working on before Abpolecon.ca goes into a slumber mode. Over the past year, I have watched with trepidation the assault on the character of federal minister of the Environment and Climate Change, Stephen Guilbeault by his Alberta counterpart Rebecca Schulz. Another piece deals with my FOIPP request to Alberta Treasury Board and Finance concerning the establishment of an Alberta Revenue Agency.
The purpose of my sabbatical is to work on updating my family’s genealogy. My uncle completed a second genealogy in 1974 and I was given the task when he passed on to carry on his work. I have procrastinated for several decades, and it is time to begin what will likely be a multi-year project.
In the meantime, Alberta’s political economy will continue to “evolve.” I will follow developments and periodically post short blogs highlighting important developments in our polity and economy.
Thank you dear reader for your support and loyalty!