Wednesday, April 8, 2009

Budget 2009 - Waiting to Exhale

Well, Nation, B-Day has come and gone. Alberta's Finance Minister, wearing the nicest pink ensemble seen on Budget Day since the famous Stockwell Day-in-fuchsia ensemble for Budget 1998, has laid down the business plan for Alberta's largest single employer and service provider.

The Premier and his cabinet have decided to play "wait and see" with this budget - much to the chagrin of more aggressive fiscal hawks than I. Many of the more vocal fiscal conservatives in the province were calling for Klein-era cutbacks, across the board and in every department. The thought of going back into debt or deficit was anathema. "You can't spend your way out of a recession", went the mantra.

And yet, when the rubber hit the road, the government put forward a budget yesterday that looked very much like it would have had the price of oil and gas remained at 2007 levels. With crude at $65 per barrel, we likely would have seen a bit more for infrastructure, a bit more for parks and for culture, modest tax cuts and an increase in the numbers of local police and fire/ems personnel. "Feel good" spending. Take away that extra income, though, and the "feel good" spending goes into the circular file, but overall the budget still meets the needs of most of us, most of the time. Some areas saw increases in spending where needed (AISH, for example), and some saw decreases where they could be afforded.

Overall, one gets the impression that the government tabled this budget knowing that the REAL action is going to happen in about 8 months. By December of this year, we'll either be well on the way to recovery in this province, or we'll be in full-on recession mode. The reality of our situation is that we are very much dependant on our energy industry - right or wrong, that's the reality and it's unlikely to change any time soon. Global energy prices are low, and either that has nothing whatsoever to do with Ed Stelmach's new Royalty regime, or our man Ed ruined the global energy sector. Which do you think is more likely, Ed-haters? If energy prices go back up, we'll be able to pay back the stabilization fund, we'll post a smaller Actual Deficit than the Budgeted Deficit of $4.7 Billion (if energy prices go high enough, we may even end up posting a surplus - which would be far from unwelcome). If the energy sector does NOT begin to recover, and Alberta's economic engine remains "stalled", then we're going to have to start looking at real and substantive cuts - starting with $2.2 Billion in this fiscal year, under the current budget plan.

I've got to say that while I'm less than enthralled with some of the specific line items and program expenditures or cuts in the budget, overall this is a budget I can live with. We're not blowing up the public sector workforce, and making a bad situation worse by kicking hundreds or thousands of government workers to the curb, adding to unemployment. We've cost ourselves, as a province, over a billion per year by eliminating Health premiums - and I don't think anyone's too upset by THAT loss of provincial government income. We're running a "record deficit", but we're running that deficit predicting Crude Oil at USD$55.50 per barrel (it's just under $51, as of this moment) and Natural Gas at C$5.50 per Gigajoule (currently sitting around $3, if I'm reading the business page correctly) - if those numbers prove to be low, and the actual numbers are higher, we'll have a smaller deficit - if any at all.

Deficit, by the way, is another one of those words that ideologues sometimes throw around to scare you - like "liberal". Anyone who uses a credit card or dips into their overdraft for a day or two until the next paycheque comes in has run a deficit in their own life. Heck, I ROUTINELY run a deficit, from day-to-day... I'm going to earn around $200 today. If I go out and spend $400 today, and it's my bad luck to have to report my financial ins-and-outs on a daily basis to the Future Mrs. Savage, then my books are going to have red ink in them. Luckily, I have savings to draw on, in order to make up today's shortfall. Likewise with Alberta. We're forecasting greater spending in 2009-10 than revenue. But we've got money in the bank, and provided the economy doesn't go into free-fall, we'll be fine. If things stay the way they are, we'll have reason to start worrying. If things get worse - out comes the axe.

And IF we get to that point... we need to get over our fearfulness, and start having a real discussion about what we WANT versus what we NEED in this province. Just like in our own families, when times get tough we sometimes have to accept that "Filet Mignon Night" might become "Kraft Dinner Night", and our planned Disneyland Vacation might turn into a long week-end camping trip to Mt. Kidd in Kananaskis.

In the Savage household, when money gets tight, the first place we look for potential saving is in the areas of greatest expense. In our case, that's the mortgage, then the auto expenses. In the province's case, that's Alberta Health and Wellness.

Ooooooooooooooo... kinda makes your spine tingle, hearing the scream of outrage from the Friends of Medicare and Raging Grannies and Brian Mason's Facebook Fan Club, doesn't it?

Look, Nation - we are ALL stakeholders in the Alberta health system - unless I have readers who are in perfect health and plan on living forever (Q?), we're ALL going to have to use the system. But, as I said above, we have to decide what it is about our system that we NEED to have, and what it is that the WANT to have. The stuff that we NEED, like doctors and nurses and hand sanitizer, should stay. The stuff that we WANT, like 600 thread-count sheets, plasma screen televisions in the hospital rooms, and ambulances with 5 cd-changers, we might have to forego.

I regularly see a chiropractor. The fact that Alberta Health isn't going to pick up half the tab for those visits anymore is going to hurt my bottom line. I will have to make decisions about my care, then, with an eye towards my wallet instead of simply towards my quality of life. But you know what? I've been doing that same set of mental gymnastics about dental care for my entire life! We've all bought generic pain relievers when money was tight, even though we were sure that Advil was going to work better. We've all gone 8 months between dental cleanings, when the car needed a new transmission in month 6 and we couldn't afford to get both done. Those are decisions we've made as individuals, based on our priorities.

I'm not saying that we should cut costs provincially by firing the surgeons and mailing every Albertan a scalpel and the "E.R." DVD box set, but the recent amalgamation of the regional health authorities is going to be one of those measures through which we can spend less on things we DON'T need - like money to hire "government relations staff" (lobbyists) to lobby the provincial government for more money (which, one assumes, would be used to hire more lobbyists) - and, instead, spend that money on things that we DO need.

We need to be able to have open and frank discussions in this province about departments like Alberta Health and Alberta Education without letting fear drive us to the default position of "cutting anything in this department is terrible, and every budget this department should get a 10% increase, at the minimum". We simply can NOT afford to keep operating this way, and we can NOT afford to let fear make our spending decisions for us. And having our leaders afraid to even START the discussion, for fear of huge protests and political repurcussions, doesn't help ANY of us in the long run, because we're burning through money that we MIGHT not have to be spending - if the protest groups with lyrics sheets ready-to-go would just let us talk to each other about realities and priorities, like grown-ups.

We're adults... we can talk about where we're spending our education dollars, and where there are savings to be had and inefficiencies to be resolved without someone from an opposition party or the ATA issuing a press release decrying an "attack on teachers and classroom conditions!", can't we? We can talk about cutting the fat out of the health system without someone screaming bloody murder about low birthweight babies being Ron Liepert's legacy, or that Ed Stelmach causes cancer, right?

So let's DO that, and contribute to the solutions that will help this province save money rather than holding onto our good ideas for partisan reasons. If a New Democrat has an idea that will make this province a better place, I don't want him or her holding onto it so as not to let it be said that someone's life was improved with government help while the Tories were in power... If a Tory has an idea on how to help the Alberta Liberals fix their funding problems, I'd hope they'll come forward and share it with the Grits, so we can have an effective Opposition to the current government - which is a benefit to ALL Albertans... as citizens, we have a civic obligation to try and improve the lives of our fellow citizens that transcends politics. So let's stop taking shots at each other, leave that to the professionals on Access at 1:30 pm today, and let's put all this brain power to good use for the betterment of all.

This province is in need of good ideas to help us fix this mess and avoid future ones - not just partisan bickering about who screwed up the province's economy, or what party used to have what fiscal policies back in the 80's.

Whaddya say?

Feel like being part of the solution?

1 comment:

Anonymous said...

Excellent. One of your best, IMHO.

Margaret Wente also had a great piece in the Globe & Mail about post-secondary education spending. It wasn't written specifically for Alberta, but it applies very well.

And it got me thinking... Does every University have to be a "research" university in every subject? Or, for lack of another term, can we not have provincial Centres of Excellence? Each discipline is pegged to have most research done out of one place, while actual teaching goes on at every university (the non-research universities focus on hiring good teaching profs, not gurus who merely publish a lot). If you had four out of five profs that spent essentially all of their time teaching, without the burden of having to do research (publish or perish is now the norm, for tenure purposes), you could leverage the best teachers over more students, and get rid of deadweight.