Government Finances Archives - Page 11 of 12

24Apr

By Bob AscahNo Comments

Banks, Financial Institutions, Government Finances, Opinion/Research

“A Distrust of Everything”- Opinion

In 1982, I interviewed Nigel Gunn, who at that time was the Honorary Chairman of Bell Gouinlock, a well- respected boutique investment dealer specializing in municipal debt. My dissertation (Politics and Public Debt) is about federal public debt management from the 1920s to the 1950s. The one critical point Gunn made in the interview that I will never forget was his statement that when the United Kingdom Treasury abandoned gold in September 1931, "this lead to a distrust of everything." A similar phrase was heard during the 2007-2009 financial crisis, but with Ben Bernanke to the rescue- a student of history- the finger was put in the dike. Here we are again at another financial reckoning. At the present time, our Bank of Canada is following a conventional, yet extraordinary pat...

Reset for federal-provincial-municipal fiscal arrangements? Opinion

17Apr

By Bob AscahNo Comments

Credit Ratings, Fiscal History, Government Finances, Intergovernmental, Opinion/Research

Reset for federal-provincial-municipal fiscal arrangements? Opinion

It is cliché to say we are living in extraordinary times. Comparisons with the Global Financial Crisis doesn’t work, although monetary madness is again afoot. For Alberta, there are comparisons with the 1980s when homes were sold for a dollar, allowing mortgagors to walk away. And of course, there is the Great Depression, which devastated all of Canada and left lasting resonance on how people related to others, to governments, and to money. So now, we are in a time of both crisis and reflection. Should governments (national and sub-national) be co-operating or competing? We know the beggar thy neighbour policies of the Great Depression did not work, but our next-door neighbour seems intent to draw up the bridges on the castle. In Canada, we are in in a period of inter-governmental co-oper...

Keystone-XL, the Alberta Petroleum Marketing Commission and the Borrowers

9Apr

By Bob AscahNo Comments

Agencies, Credit Ratings, Energy, Energy, Government Finances, Opinion/Research

Keystone-XL, the Alberta Petroleum Marketing Commission and the Borrowers

At the end of March, the Alberta cabinet passed Order in Council 104/2020 which authorized the “President of Treasury Board and Minister of Finance to make advances to or purchase securities of the Alberta Petroleum Marketing Commission.” In addition, the Minister was given the authority to raise: “up to $2 000 000 000, by the issue and sale from time to time of notes, bonds, debentures or interest-bearing or non-interest-bearing treasury bills issued by the Crown in right of Alberta or any other securities under which the Crown in right of Alberta is the debtor (collectively referred to hereafter as “Government securities”) for the purpose of making advances to or purchasing securities of the Alberta Petroleum Marketing Commission in respect of the development of a...

3Apr

By Bob AscahNo Comments

Agencies, Energy, Government Finances, Opinion/Research, Politics

Politics of Alberta Growth Mandate (AGM)

Politics of the Alberta Growth Mandate In past articles, the Alberta Growth Mandate was explained as a significant policy initiative in the first NDP budget of October 2015. It should be noted that, in the fall of 2015, Alberta was reeling from significant declines in investment and job losses, and a rookie NDP government was looking for quick wins to support jobs in the Alberta economy. The policy objective was to support Alberta companies (as defined by the Alberta Investment Management Corporation (AIMCo)) and based on meeting one of the following criteria. a. Creates jobs in Alberta b. Builds new infrastructure in Alberta c. Diversifies Alberta’s economy d. Supports Alberta’s growth e. Connects Alberta’s companies to export markets f. Develops subject matter expert...

30Mar

By Bob AscahNo Comments

Budget, Credit Ratings, Government Finances, Intergovernmental

Government Borrowing

Updated 2 April 2020 A number of historic events have taken place this past week, with long-term ramifications for the Canadian and Alberta economies. Bank of Canada actions to purchase money market paper of provincial governmentsBank of Canada starts quantitative easing and will purchase commercial paperManitoba Premier calling on the federal government to establish a Pandemic Emergency Credit FacilityProvince of Alberta issues a century bond Alberta is witnessing the deepest economic storm since the mid-1980s and likely will see conditions similar to the Great Depression over the next few months. Unlike the Great Depression, our social safety net and government willingness to “do whatever it takes” will moderate the financial and economic distress. Unlike the Great Depression, ...

Alberta ‘Growth’ Mandate- Analysis and Opinion

22Mar

By Bob AscahNo Comments

Agencies, Budget, Government Finances, Opinion/Research, Politics

Alberta ‘Growth’ Mandate- Analysis and Opinion

While now is not necessarily the best time to be taking stock of one's investment portfolio, government and provincial agency officials, who face a March 31 fiscal year end deadline, are concerned about the impact of accounting rules that require "fair market accounting" for their investments. The performance of both bond and equity markets over the next ten days will determine whether forecasts for investment income in the provincial budget ($1.96 billion for the Heritage Fund) will actually pan out. Investment income for investment portfolios are typically composed of two types of income: (1) dividends and interest payments or cash distributions from private equity, and (2) increases or decreases of the "fair value" of the investment at year -end compared to the initial cost of buy...

22Mar

By Bob AscahNo Comments

Budget, Credit Ratings, Government Finances, Opinion/Research, Opinion/Research

Budget 2020-Credit Perspective

[Updated 23 August 2020. Note: This report was in development before the DBRS Morningstar report of Thursday 19 March. The report is only available to purchasers of the service. Normally, the Province of Alberta posts on its Investor Relations page the reports. To date, this has not taken place. Nor has there been an official reaction to the downgrade to AA- from AA and the outlook to negative.] One of the key audiences of any government budget, but especially a budget under increasing duress and scrutiny, are credit rating agencies such as Moody’s, Standard & Poor’s and DBRS Morningstar. Credit evaluation is as much an art as a science, requiring an understanding of financial principles, economics and political science. Agencies provide opinions on probabilities of default of b...

Energy Wars in the 1970s- Hyndman’s files

26Nov

By Bob AscahNo Comments

Energy, Government Finances, Intergovernmental, Uncategorized

Energy Wars in the 1970s- Hyndman’s files

Two more excerpts from the files of the late Lou Hyndman come from the mid 1970s. The disputes being addressed by senior political leaders followed soon after the OPEC oil embargo. The conflict which emerged between Ottawa and the consuming provinces (e.g. Ontario) and Alberta involved a bitter fight over which order of government would collect the lion's share of the rapid increase in the world price of oil. The first excerpt is from a speech given by the then Treasurer, Gordon Miniely at a finance ministers' conference. The second extract is from a speech, presumably authored, by J.Peter Meekison, a special intergovernmental affairs advisor and then deputy minister of Alberta's Federal and Intergovernmental Affairs department dated in December 1974. The speech is significant as i...

30Oct

By Bob AscahNo Comments

Budget, Government Finances, Politics

Sales Tax for Alberta?

Recently there has been a renewed interest in a sales tax for Alberta. Grant Bishop of the C.D. Howe Institute writing a "Shadow Budget" for Alberta, has suggested the introduction of a sales tax after the budget is balanced through spending cuts. In a recent report from the Parkland Institute, Cutting Through the Blue Ribbon, authors Bob Ascah, Trevor Harrison, and Richard Mueller conclude that a provincial sales tax, harmonized with the federal Goods and Services Tax, is an appropriate fiscal measure to achieve fiscal sustainability. SUch a revenue measure would directly address Alberta's chronic vulnerability to fluctuating commodity prices. Then in an October 25th piece in The Globe and Mail, Max Fawcett argues that Jason Kenney, like Richard Nixon going to China, is uniquely placed ...

Critical Review of the Blue Ribbon Panel on Alberta’s Finances (MacKinnon Report)

30Oct

By Bob AscahNo Comments

Budget, Government Finances

Critical Review of the Blue Ribbon Panel on Alberta’s Finances (MacKinnon Report)

This analysis of the Blue-Ribbon Panel on Alberta’s Finances: Report and Recommendations (McKinnon report) includes a description of the construction of the panel- its membership, its mandate, process, and its members’ experience and predispositions. In the second part of the paper, I describe how the construction of the panel predetermined its recommendations. And finally, using textual analysis, I examine the basic assumptions used by the Report’s authors to construct their interpretation of how to improve the provincial government’s fiscal standing. Composition of Panel On 7 May, three weeks after the election of the UCP, Premier Kenney and Travis Toews, Treasury Board President and Minister of Finance announced the formation of the Blue-Ribbon panel. As most commentators quickly reali...