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Reaction to this afternoon's Alberta Budget Speech is bound to be completely predictable

Joe Ceci

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Reaction to this afternoon's Alberta Budget Speech should unfold in a completely predictable fashion.

When written about after the fact by modern journalists, this kind of political event is termed Kabuki theatre, which is to say, we all knew that was going to happen.

Almost no one who uses this specialized journalistic term has actually seen a classical Japanese Kabuki theatre performance. But then, almost no one who uses the journalistic term for its opposite, Kafkaesque, which means weird, we had no idea that was going to happen, has ever read anything by Franz Kafka either. 

But trust me on this, this afternoon's performance, which will start as soon as Finance Minister Joe Ceci tables the budget just after 3 p.m., will unfold as pure Kabuk.

Yes, the actual details of the budget should be interesting, and mostly unknown until the speech is tabled. But the theatrical bits are all pure formula:

Everyone expects Ceci to explain that things are bad, the result in part of economic factors beyond Alberta's control and in part because of economic mismanagement by the previous Progressive Conservative government.

The first part of this statement is unquestionably true. Almost everything else that will be said by all of the players will be a matter of opinion or interpretation, or both. Some of these, of course, will be more soundly grounded in fact than the rest.

Everyone expects Ceci to say that because of the NDP government's prudent decision to continue spending on essential services, needed infrastructure and efforts to diversify the economy, things will be kept on track until conditions improve. This will come about through higher commodity prices in the world beyond our government's control and through the sound economic stimulus provided by the government at a time when borrowing costs are low. In addition, he will probably say the very wealthiest few in our society will be asked to pay just a little bit more.

Everyone also expects Ceci to state that by 2019, thanks to the government's sound fiscal management, Alberta's budget will be balanced.

A press release that has almost already been written will reinforce these points with quotes from Premier Rachel Notley and others.

After the speech, everyone in attendance will repair to the Legislature foyer to be interviewed by the media, purveyors of both Kabuki and Kafka.

There, everyone expects Wildrose Opposition Finance Critic Derek Fildebrandt to concede, as if reluctantly, that the NDP is right about the previous government's mismanagement but wrong about everything else.

Everyone expects him to warn that the spending planned by the government will only accentuate the massive deficit Alberta has already been running, and to remind Albertans of the need to tighten our belts and waste less money on unneeded government services. He is expected to warn that increasing taxes will make Alberta less competitive. And if we don't do something about debt and deficit now, he may even say, we will be robbing our grandchildren!

Everyone expects Fildebrandt also to say the budget must be balanced as soon as possible, and to do so we must immediately stop living beyond our means. He will remind voters that the NDP party platform originally predicted the budget would be balanced by 2017, it was then revised to 2018, and now, quelle horreur, it is said to be scheduled for 2019. What's next, he may well wonder aloud, 2020?

A press release that has almost certainly been written will reinforce these points with quotes from Wildrose Party Leader Brian Jean and others.

Then again, perhaps Jean will take on this job on himself and relegate Fildebrandt to silence in a back corner. The ambitious Wildrose finance critic sat silently in yesterday's warm-up for today’s performance, far from his leader, as if he had been discovered to be naughty.

If the spokesperson changes, however, the message will not. We are certain to be presented, by the Government and Opposition, with two versions of the economy starkly at odds with one another.

As for the Progressive Conservative Party, Leader Ric McIver will likely argue that the policies announced by Ceci are not so different from those of the previous government, and therefore would have been sound if the PCs were still in power, but that now we should do something more like what the Wildrose Party is proposing, because they aren't sound any more. Or something. A press release? Perhaps they'd better not.

Now, if elite-policy-making opinion for the past decade has tended to support the Wildrose view, as it is predicted here, mainstream economists have been siding with the NDP.

Writing in the New York Times on Friday, Nobel Prize winning economist Paul Krugman celebrated the election in Canada of Justin Trudeau's Liberals. The party, he said, was "finally willing to say what sensible economists (even at places like the International Monetary Fund) have been saying all along." That is, that modest deficits and stimulus spending are the policies the evidence supports for circumstances like the ones we now face on this continent. "And they weren't punished politically -- on the contrary, they won a stunning victory."

To keep it simple for U.S. readers, Krugman didn't mention that Trudeau's stunning victory in October was heralded by Notley's in May -- also based on an electoral strategy of being prepared to say what sensible economists have been arguing all along.

Remember also that a $6-billion Alberta budget deficit -- as has been predicted in the lead-up to today's budget -- would amount to a mere 1.8 per cent of Alberta's Gross Domestic Product. To put this in perspective, the U.S. federal deficit in 2009 was 9.8 per cent of GDP.

Moreover, as the Parkland Institute showed in a useful commentary on the expectations for today's budget, some of the claims likely to be made by the market fundamentalist opposition parties are simply not true:

  • Spending in Alberta is not "out of control" -- it's been about the same for the past seven years.
  • Nor does Alberta spend more than other provinces -- it hasn't been the highest spending province for 20 years.
  • Nor is Alberta's debt out of control -- indeed, it has no net debt, that is, it is the only province whose savings exceed its total debt.

Of course, the PCs can rightly take credit for those points, even if they dipped into savings to give an underserved impression of budget balancing.

Regardless, as Maclean's magazine argued in a useful commentary on Alberta's fiscal situation last week, no matter what the Wildrose Party says today, the projected deficit is "hardly sky-is-falling territory."

Indeed, the evidence has long suggested that the deficit doom-saying of the last decade was mainly driven by politics, not economics, specifically the desire of the market fundamentalist right to gut the public sector, shred the social safety net and hand the state over to the private sector.

These are all things the NDP was elected to prevent.

Well, the house lights are flickering. Cue the cries of joy and anguish! It's time to hurry to our seats and prepare to watch the performance.

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

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