Photo: Norsk Teknisk Museum, Wikimedia Commons.

In case you missed it, Norway’s sovereign wealth fund smashed through the $1-trillion barrier Tuesday. Alas, the financial sonic boom was barely audible out here in Alberta.

That’s a trillion with a T, by the way. You know, a million million dollars. And those are U.S. dollars.

It’s called a sovereign wealth fund because Norway, being a social democracy and everything, decided the vast wealth generated by its oil resources should be invested exclusively for the benefit of the country’s approximately five million citizens.

After all, Norwegian officials reasoned when they set up the fund in 1996, their fellow citizens owned the stuff in common. All Norwegians should all reap the benefits together.

I mention this because Alberta’s Heritage Savings Trust Fund — established by the government of premier Peter Lougheed in 1976 with very similar goals in mind — is reputed to have partly inspired Norway’s approach to saving, not just for a rainy day, but also for a sunny petroleum-free future.

According to the Alberta government’s last report on the topic, the Heritage Fund is now worth a hair over $17 billion, which is only a couple of billion over where it was in the dull old 1980s. Norway’s fund is almost 60 times larger.

That’s because, as Canadian financial journalist Eric Reguly wrote back in 2013, after we Albertans got tired of Peter-Lougheed-style saving — soooooo boring! — we “decided that a drunken, blow-out dance party today was better than a string of candle-lit dinner parties down the road.”

And, admit it, everyone … the drunken partying was fun!

We got to yell at other provinces about how they should become ultra-low-tax jurisdictions just like us. (Why not? If they were better managers, they would have moved somewhere with oil and gas just like we did, right?) Plus, Ralph Klein gave every single one of us enough money to buy an iPod and a six-pack of Molson’s brewskis!

Was that great, or what? I think I still have the iPod, too, if I didn’t give it to one of my kids. I’m afraid the six-pack is long gone, though.

Norway, according to Reguly, doesn’t collect royalties on its North Sea oil production, which is now dwindling at the same time, it turns out, as international oil prices are doing the same thing. “It taxes the production profits at a 78 per cent marginal rate. And all the tax revenue collected is funnelled into the country’s sovereign wealth fund that pays out 4 per cent a year to fund current spending on public services.”

But even using the royalty model, the royalties we charged in Alberta were a fraction of what they should have been. Conservative premier Ed Stelmach and NDP Premier Rachel Notley both made half-hearted stabs at fixing this, and then gave up when the oil industry bucked.

Albertans may have missed this too, but, despite the country’s more expensive financial structure, energy companies continue to invest in Norway’s oil.

“The Alberta Heritage Savings Trust Fund, the province’s rainy-day umbrella,” wrote the Globe and Mail’s Brian Milner two years ago, “barely has enough capital to deal with a few scattered storms. Norway’s equivalent, which was partly modelled on Alberta’s when it was set up in the early 1990s, could handle a deluge of almost biblical proportions.”

Lougheed, who died at 84 in 2012, observed in his final years that the fund would have been worth $100 billion or more if we’d stuck with his plan, and that “when a real revenue disaster strikes, Albertans will not have the fund as a shield.”

Well, here we are. Six additional Conservative premiers after Lougheed, we already had the revenue disaster when Notley’s NDP government was elected — caused by the very same low oil prices Norway has no need to panic about. And we have … as a famous Alberta political ad once whispered … noooo plaaan.

Well, it’s lucky for the Conservatives, in a way, that we have an NDP government they can kick around for the consequences of their decades-long irresponsibility.

No plan. Well, not much of one, anyway. Certainly not as good a one as biting the reality bullet and bringing in a sales tax. For a lot of Albertans, the plan is to bring Klein back from the dead in the form of Jason Kenney.

Other than their general physical shape and market fundamentalist irresponsibility, however, it would be hard to find two politicians less like one another. As is fairly widely understood, Klein didn’t even particularly like Kenney.

Kenney claims they were pals, however, and had a beer together while they came up with a plan to give this province “the Alberta Advantage”!

I can do Kenney one better, I think. I had a beer with Klein twice. Mind you, both times were in the company of a large number of carousing journos, and as far as I can recall, there was no dancing.

Alas, Ralph and I didn’t come up with a plan to create an “Alberta Advantage” like Kenney claims the two of them did. You may think “just as well,” but who knows? Maybe if we’d worked on it together we’d have thought up with a brainstorm like, “Hey! How about we keep putting money into the Heritage Fund!”

No such luck.

But look at the bright side. If Kenney succeeds with his political master plan, maybe all four-plus million of us will get an iPhone this time, plus enough change left over for a whole case of watery Saskatchewan beer from the home province of the real leader of Western Canada, Kenney’s real hero, Brad Wall.

Of course, it might cost us our health-care system, but … hey! It’s party time again!

Meanwhile, as we await the Green Apocalypse here in Alberta, Yngve Slyngstad, CEO of the Norwegian sovereign fund, was justifiably patting himself on the back Tuesday.

“I don’t think anyone expected the fund to ever reach $1 trillion when the first transfer of oil revenue was made in May 1996,” Slyngstad said. “Reaching $1 trillion is a milestone, and the growth in the fund’s market value has been stunning.”

Yup.

This post also appears on David Climenhaga’s blog, AlbertaPolitics.ca.

Photo: Norsk Teknisk Museum, Wikimedia Commons.

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David J. Climenhaga

David J. Climenhaga

David Climenhaga is a journalist and trade union communicator who has worked in senior writing and editing positions with the Globe and Mail and the Calgary Herald. He left journalism after the strike...