AB Pol Econ

28Nov

By Bob AscahNo Comments

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

Mid-year Fiscal and Economic Update- Analysis & Opinion

Slight improvement in deficit forecast for 2020-21 Recalibration of 3-year budget plan Balanced budget pushed further into future Fiscal anchors Ottawa's growing indebtedness and other grievances Job Creation Tax Cut and cutting red tape expected to spur investment and employment Government stays with present course to resize spending Small hint about need to examine revenue structure On Tuesday 24 November, Finance Minister Travis Toews released the 2020-21 Mid-year Fiscal Update and Economic Statement. (Watch the Press Conference here.) There was a slight improvement in the deficit numbers in the First Quarter Fiscal Forecast - then the deficit was estimated to be $24.8 billion- now the Government expects a $21.3 billion deficit. Improvements came mainly on the revenue side with $1.4 b...

25Nov

By Bob Ascah1 Comment

Capital Spending, Economic Data, Energy, Environment, Fiscal History, Government Finances, Politics

Presentation to EQUS directors- 23 November

EQUS is a small, co-operative distributor of electricity to 12,000, mostly rural, customers. The organization is the product of a series of mergers of rural electrification co-operatives over the past two decades. EQUS employs about 100 staff with its head office in Innisfail. The presentation, provocatively entitled "Alberta's Crumbling Economic and Fiscal Foundation" builds on concerns about the future health of Alberta's economy in a world where international financial capital places more emphasis on renewable energy solutions. The presentation highlights the pivotal role of capital expenditures of the oil and gas sector which have driven the Alberta economy since 1947. Alberta's gross fixed capital formation (oil and gas, institutional, industrial, residential and non-residential bui...

18Nov

By Bob Ascah2 Comments

Agencies, Government Finances

AIMCo CEO Compensation 2008-2020

This article follows a similar format as the analysis of ATB’s CEO compensation. We begin with some background on the creation of the corporation in 2007 from published and unpublished research. Then follows a series of charts illustrating the evolution of AIMCo CEO pay over the period. The concluding section investigates the question of pay equity by comparing the AIMCo chief’s compensation against the average compensation of AIMCo employees, peers- the Caisse de Depot et Placement du Quebec (Caisse), the British Columbia Investment Management Corporation (BCMIC), and senior elected and appointed provincial officials. A slide deck is included at the bottom of this article. Background In 2007, the Alberta Investment Management Corporation Act was passed creating a board-governe...

Peter Lougheed- Address to Calgary Chamber of Commerce- 13 March 1981

16Nov

By Bob AscahNo Comments

Energy, Fiscal History, Intergovernmental, Politics

Peter Lougheed- Address to Calgary Chamber of Commerce- 13 March 1981

Background From Lou Hyndman's papers, this speech is given to a friendly business audience at the height of the energy fight between Ottawa and ALberta. The parallels between 1980-81 and today are many, but there are considerable differences. In 1980-81, inflation was rampant over 10 per cent and interest rates had soared. Oil was trading at historic highs due to the 1979 Iranian revolution. The Alberta economy had enjoyed six straight years of boom conditions. Unemployment was very low and cranes dotted Edmonton and Calgary's skylines. Joe Clark's administration had been dethroned and Pierre Trudeau was back in office. Jimmy Carter had lost the presidency to Ronald Reagan and the rest of the world outside Alberta was spiralling into recession. The National Energy Program was an attack o...

Moment of Truth- Book Review and Opinion

9Nov

By Bob Ascah3 Comments

Uncategorized

Moment of Truth- Book Review and Opinion

Preamble It would be unfair to dismiss the authors of Moment of Truth as grumpy, mostly white old men. This hastily edited textbook for Wexiters and Fair Dealers is a compelling read making a plausible case for a colony separating from its metropolitan or imperial power. The book is published by Sutherland House and edited by Jack Mintz, Ted Morton and Tom Flanagan. The list of grievances are long and familiar: equalization; Bill C-69; the NEP; official bilingualism; special treatment of Quebec; under-representation in Parliament; supply management; the federal carbon tax; and judicial decision-making. Jack Mintz Source: UCalgary.ca Although not intended, the book makes a persuasive case against the imperial-style capitalism which western Canada has been subject to since before Confed...

6Nov

By Bob Ascah3 Comments

Economic Data, Energy, Fiscal History, Government Finances

Presentation to Professors Emeritus

Yesterday I presented to a small but engaged group of retired University of Alberta emeritus professors. My talk was provocatively entitled "Alberta's Crumbling Economic and Fiscal Foundation." Key points emphasized in the presentation include: Volatility in price of oil over past 6o years and its impact on provincial finances Over past 40 years Non-renewable resource revenue represents a high of nearly 50 per cent of own source revenue (excludes federal transfers) to lows of just under 10 per cent recently. Based on Canadian Association of Petroleum Producers data since 1947, Alberta collected royalties equivalent to about 10 per cent of the total value of production over this 70-year span. In the early 1980s, Albertans were receiving about one-third of the rent from their resource owne...

ATB CEO Executive Compensation – unwrapped

28Oct

By Bob AscahNo Comments

Agencies, ATB

ATB CEO Executive Compensation – unwrapped

This article examines CEO executive compensation at Alberta Treasury Branches (ATB Financial) since it became a provincial agency or Crown corporation, in 1997. The focus of this article is how the return on capital or equity and the pay of the CEO are related over a 23-year period. Also, the question of fairness of compensation in relation to compensation of senior government officials, average ATB salaries, and the CEO of Canadian Western Bank (CWB) is canvassed. [The data used is the total of salary and benefits or total compensation and comes from ATB's annual reports. A separate PDF of the article and PowerPoint/PDF of the figures is produced at the bottom of the article for better viewing of the charts.} Background In 1994, Treasurer Jim Dinning was facing persistent and difficult q...

18Oct

By Bob AscahNo Comments

Government Finances, Opinion/Research, Politics

Harmonized Sales Tax not a Panacea- Opinion

But neither will ignoring the revenue side cure the deficit problem Franco Terrazzano's Opinion piece in the 9 October Edmonton Journal is quite right when he observes that a “provincial sales tax won’t erase Alberta’s red ink.” No single mechanism can do that. Alberta’s massive deficit and future deficits will not go away merely by blaming Alberta politicians (past and present) who have spent resource wealth on maintaining a high level of public services and infrastructure. However to suggest that sales tax advocates believe a sales tax will eliminate the deficit by itself is disingenuous. The economic argument for a sales tax is compelling for a number of reasons. First, it is a far more efficient tax than personal or corporate income taxes. A commonly used metric of the economic cost...

10Oct

By Bob AscahNo Comments

Employment, Energy, Environment

Knowing a future?

An indirect effect of the “cashing-in” on virgin natural resources by the introduction of the new industrial technique with government support has been an indeterminate relationship between government expenditures and government revenue. Expenditures made on the assumption that revenue will return from various directions has been responsible for the incurable and dangerous optimism which characterizes government effort. On the whole, public enterprises to which government contributes have introduced an element of uncertainty in the financial position of the government and a degree of unwholesome inelasticity. Harold A.Innis, Problems of Staple Production in Canada. 1933, 64-65-emphasis added On Tuesday, 6 October Premier Kenney, Associate Minister of Natural Gas Dave Nally, and a phalan...

4Oct

By Bob Ascah4 Comments

Uncategorized

Presentation to Edmonton West Rotary Club

Updated 15 October 2020 with correction to Chart 24 in Slide presentation On Thursday 1 October, I gave the following Power Point presentation entitled "Alberta’s Halting Economic Recovery- Implications for Alberta’s Public Finances" to a local group of Rotarians. It was a rather sobering and depressing presentation. The presentation also gave me an opportunity to plug the edited collection A Sales Tax for Alberta: Why and How to published next year by Athabasca University Press. In my view the present government is doing what a succession of provincial governments have done for decades: accept the myth that Alberta is defined solely by its economy and the economy IS the exploration, mining, development and production of fossil fuels. This mindset has clouded the decision-making o...