And You Promised God Not to Piss It Away

The Alberta bumper sticker read, "Dear God, give us another oil boom and, this time, we promise we won't piss it away."  Maybe that just says what Albertans really think of God.

Now they're about to elect the Queen of Rednecks to be their next premier, Danielle Smith, and she's bound and determined to piss away all the harder.

Wildrose wants to grant further concessions to the oil and gas sector in spite of repeated independent reports calling for increased resource rents -- and three successive budget deficits. In the midst of an oil boom, the richest province in confederation and the engine of what Prime Minister Harper calls a "global energy superpower" can't seem to balance the books. 

...The province stopped contributing any money to the iconic Alberta Heritage Fund in the 1980s. Draw downs from the Sustainability Fund -- a more easily accessible pot of past oil wealth -- will total 90 per cent from 2009 to 2014. What is left of Alberta's total retained oil savings will be cut almost in half during this period -- even as the government closes hospital beds and schools.

...It didn't have to be this way. A recent report from the Parkland Institute showed that if the royalty target of former premier Peter Lougheed of 35 per cent had been met, Alberta would have collected almost $200 billion in extra revenues between 1971 and 2010. The authors state "The Alberta government will forgo some $55 billion in potential revenue over the next three years as a result of overly generous royalty cuts and the government's failure to meet even the modest targets set by previous administrations."


...Norway ...has grappled with how to best manage an infusion of oil wealth. In order to avoid artificially inflating their currency from the economic malady of Dutch Disease, Norwegians set up a sovereign wealth fund in the early 1990s and hired a philosopher to help decide what to do with all the money.

This fund now has more than $570 billion -- 37 times more than the now moribund Alberta Heritage Fund. This massive pool of wealth is also legally isolated from general revenue so that present and future Norwegian governments do not become dependent on short term royalties to balance the books -- or politically beholden to the oil industry. Interest revenue from this pile of cash totals about $25 billion annually and climbing, supporting enviable social programs. 

Wildrose and the oil sector are so entwined they recently launched a joint campaign called Protect the Patch that opposes Stelmach's modest royalty increases and is running a slate of 13 candidates specifically from the oil and gas sector. While co-sponsored by Wildrose, the campaign seems to self-identify more with the oil sector than the people of Alberta, stating "Our industry has virtually no direct representation on the floor of the legislature in Edmonton... we're determined to change that."