Smoky River Regional
Acting now to address Alberta’s economic ills is essential
I have worked in Alberta for almost 40 years now. I have had many jobs, seen a variety of federal governments but only one provincial government. I have seen the economy, the dollar and the price of oil fluctuate, but can’t say I have ever been as concerned as I am now with our future.
In the past, there always seemed to be a light at the end of the tunnel. Now I can see a light, but I think it’s a candle or a glow stick and I think it is going to take a little longer for us to reach it. I recall in the 80’s I was living in Calgary, oil prices had dropped and mortgage rates were hovering in the 18 per cent range.
People were walking away from their homes because they had lost employment and simply couldn’t make their payments. With mortgage rates in the high teens, housing costs were extreme. People were selling their home for $1 if you would take over their mortgage. A recent article by CBC, says those days are back, most notably in Grande Prairie and Fort McMurray.
They referred to it a “jingle mail.” People are mailing their house keys back to their financial institutions that hold the mortgage and walking away. Unique laws in Alberta make it a little easier for Alberta property owners to do that than in other parts of the country.
A little while back the news was reporting people are abandoning their vehicles at Alberta’s two major airports in Calgary and Edmonton. We are not talking about 20-year-old beaters; we are talking about newer pricey four-wheel drive trucks. I suspect these people are the oil workers from back east that lost their job, saw little opportunity for a sudden turn around, and chose to simply abandon their vehicles and return home.
There is no doubt, we are in a tough position, a position that we and even our provincial government have little control over. International events that led to the falling price of oil and the massive glut of reserves, all of which happened in a very quick period of time, has impacted us to a degree we have never seen before.
Blaming the previous government for not saving more money or diversifying the economy more are non-starters. Alberta is subject to federal transfer payments and that alone ate a healthy chunk of money we could have saved. Alberta may now be moving from a “have province” to a “have-not province,” which may now see those transfer payments reversing.
Diversification is a great idea, but usually only works when we are forced to do it. Oil and gas jobs pay substantially more than forestry, agriculture, retail and most other jobs. Most of us seek employment that pays the best and so the reality of diversification was never really pursued.
The coming years will be, I believe, painful. People are losing their jobs, their cars and their homes. Municipalities will see reduced revenue and will have to make tough decisions on whether to cut services or increase taxes.
The federal government needs to step up to the plate with support for Alberta. For decades, we have supported the federal government and the other provinces. It’s payback time. And the provincial government needs to act swiftly in taking advantage of the low cost of borrowing, readily accessible labour, and the opportunity to start creating a diversified economy. If they do not act quickly and oil prices jump again, diversification will fall to the way side, regardless of which party is running the government.
I am trusting the Alberta government has a plan, a strategy, a blueprint on how Alberta will diversify the economy in a timely manner to take advantage of our present economic climate. They need to act quickly to ensure when oil and gas prices return, the new economy will be well in place, sustainable and ready to coexist with Alberta’s energy partners