Page by Page

Wednesday, July 8, 2009

Will Alberta Harmonize?


In politics, there are positions that may look good but should not be chosen for a place to rest their laurels. Just like for Br-er Rabbit, a well's bucket may look like a great place to find solace, but sooner or later, the bucket's weathered rope gives way, giving you that sinking feeling. One only has to listen to our government leaders to predict which bucket they are seeking to stuff their backsides in.

On the heels of the news that Stemach's government has posted an $852-million deficit our Treasury Board President Lloyd Snellgrove has come out and used the phrase '5% sales tax'. He suggested that such a burden on Alberta citizens may be required to raise $8-billion annually. Considering that the province raised $35.8-billion in yearly revenue, that would represent a 22% increase in government income. That is one hell of a raise! That would represent a 10% Harmonized Sales Tax (HST) at the till for every man, woman and child in this province.

Snellgrove was careful to point out that a push for a sales tax has come up during recent meetings with unions, health-care officials and business leaders. Do we really think that these groups jumped up with arms flaying saying, “Ooh, Ooh, I know, I know, lets have a sales tax!”

Snelgrove was quoted as saying “These things [PST] should be talked about and understood, but it's not in our plans this year.”

So what is your plan?

Whenever a governing body contemplates a controversial policy an educational component is included. This usually includes some form of media programming. It is important that the masses, thats you and I, are conditioned to accept a particular policy change or change in governmental direction. With this in mind, Snelgrove actually used the term 'provincial sales tax.' But that was not the first disclosure.

In April of this year the Calgary Herald broke with a story that started with the phrase, “The surplus king of provinces has turtled into 'have deficit' status.” It clearly pointed out that after delivering 13 balanced budgets, Alberta is now showing a deficit. The voice of that article was Jim Dinning, as he was interviewed by Don Martin.

What followed were several articles and radio talk shows of how Alberta went from 'have' to 'have-not' status. The crowning propaganda came from Ed Stelmach, when he lashed out at the Federal Government stating that 'Alberta can't carry the country!' While citing an inequity of the health funding transfers, a condition that has historically been on the shoulders of Albertans. Stelmach was looking to the feds for cash. Health Minister Ron Liepert is actually quoted as saying, “As an example, if we were to implement a five-cent gas tax, that's 400-million. I'm not suggesting thats what we're doing. We are not ruling out anything, other than the premier has said there will be no provincial sales tax.” And there the PST was mentioned, even though nobody else brought it up.

By now if you have been following the news, you have come to the conclusion that Alberta is no longer the financial rock it once was. The country is in a recession. In Alberta shovel ready programs have been publicly funded. Alberta Healthcare premiums have been dropped in January giving us the impression that we have free healthcare. Alberta posted an $852-million deficit, our first in 15 years. Our government spent $3.1-billion more this fiscal period than they did in 2007-08. Considering all this I guess we are about ready to accept the debt, and reach into our pockets to bail the government out. I bet a few folks out there are ready, yes?

Is our Albertan, rolling in oil pride so bruised that we would rather take food out of the mouths of our families instead of making our elected officials accountable for poor fiscal controls?

During the Ralph Klein years the government was able to reduce the deficit by reducing government expenditures by 20 percent.That translated into a 27.4 percent cut in services to Albertans. Although we enjoy less taxes in Alberta, we were offered less services, which include reduced free services from our healthcare professionals.

Further, the Alberta Heritage Trust Fund has been reduced from a peoples 'rainy day' savings account when in 1983 the conservative government ceased to earmark any energy revenues for the AHSTF. Since then all interest income has been allocated to the General Revenue Fund. This has had the effect of reducing the value of the AHSTF and it now realizes a less financial buffer than expected.

Economists will tell you that there are only two ways of tackling a government deficit. One is to raise revenue which usually translates to increased taxes. The other is to reduce government spending. Considering that Albertans have enjoyed less public services since the deKlein years, it looks as though increasing revenue may be the only option. So will Alberta Harmonize? I would not be surprised if in the near future you will be calculating a 10 percent HST with each purchase. That is if we let them.

No comments: