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Becoming Alberta's Next Premier - Institute for Public Economics

Becoming Alberta's Next Premier - Institute for Public Economics

prefaceToday Albertans

prefaceToday Albertans have an unprecedented opportunityto engage in a political discourse with futureleaders of this province. With Premier Ed Stelmach’sresignation in January followed by Dr. Swann’sdeparture as Liberal leader shortly thereafter, Albertacitizens will be hearing how a new generation ofleaders will manage problems the province faces. Andthere is little doubt that the successful candidateswill be facing enormous challenges as Alberta girdsitself for another economic boom fueled bya huge investment boom in north-eastern Alberta.Given this fertile landscape of political activity, theInstitute for Public Economics, the Western Centrefor Economic Research at the University of Albertaand the Canada West Foundation invited seven policyexperts to share their ideas with candidates vyingto become ultimately, Alberta’s next Premier. Theresult is a compilation of articles, focusing on sevenpublic policy issues that are important to each ofthese experts. These essays cover a broad spectrum ofpublic discourse ranging from specific advocacy piecesto questions of Alberta’s role in shaping nationalpolicies. They all fit within the array of public policyaccountabilities that need to be considered by thefuture Premier if the province is to be a strongeconomic competitor and good steward of its peopleand resources. It is the hope of the sponsoringorganizations that ideas presented here will influencethe policy discussion within the different parties.The first essay by Professor Ted Chambers speaks in thefirst person as if he were “Premier for a Day.” Chambersuses the concept of the “black swan” as a basis forcontemplating the risks and challenges facing Alberta’spremier. Questions posed by Chambers touch onAlberta’s role as a major international energy producer.But what will the future hold as new transportation andenergy technologies unfold? Chambers states: “Theone thing the government should not do in meetingthis responsibility is encourage citizens to acceptthat the future will replicate the past.” As a safeguardagainst unexpected black swans, he recommendsconsideration of a new Alberta Wealth Fund thatwould receive half of resource revenue to be managedindependently. The other half of resource revenuewould be directed at human capital development—education and health services. Professor Chamberscourageously recommends that Alberta implementa harmonized GST at a 5% level to provide morestability to Alberta’s finances and “avoid the knee-jerkroller coaster of dysfunctional provincial budgets.”Turning to the social policy area, John Kolkmancounsels leadership candidates to build on the programto end homelessness and to seek the elimination ofpoverty. Kolkman urges that changes be made toAlberta taxation policy to piggyback on the existingfederal child tax benefit program. Minimum wagelegislation is another tool in the province’s policy arsenalto assist low income earners. More critical is the need torethink income support rules that claw-back benefits forlow income recipients earning more income. Anothersuggestion that echoes policy recommendationsof the Premier’s Council on Economic Strategy is theimportance of engaging more Aboriginal Canadiansin the labour force. He also challenges governments tofacilitate the integration of 58,000 foreign temporaryworkers as permanent residents.One theme that constantly runs through these essaysand will play out in the policy platforms of thecandidates is the appropriate role of the government.Dan Holinda’s essay “Alberta’s Children Deserve CleanAir” makes the case for a government interveningto protect youth against the harmful effects of tobaccosmoke in the confined area of a private vehicle.He cites a range of research that links second handsmoke to a variety of ailments beyond cancer. Thisperspective brings to the forefront the clash of valuesbecoming alberta’s next premier | june 2011 | | bob ascahi

etween those who believe “less government is goodgovernment” and those that believe the collective,through government, have a role and duty to protectchildren from harmful acts of adults.At a more macro level in the health care arena,Professor Mel McMillan examines the debate aroundwhether the Canadian economy can sustain inexorablyrising health care expenditures. Commenting on arecent C.D. Howe study by David Dodge and RichardDion, McMillan questions the seeming rush intomaking fundamental decisions on health care delivery.When examining the projections of these authors,he concludes that it is both enhancing productivity aswell as controlling health care spending that is vital.Productivity growth is essential since it is the basis fordetermining the size of the overall economy. Parsingthe data also shows that, despite the projected growthin health expenditures, future Canadians willstill be better off in terms of both health and nonhealthservices.One of the policy issues that might be termed theelephant in the room—the impact of Alberta’soilsands on the environment—is discussed by SatyaDas, author of Green Oil. Das begins with the“presumption that we have a duty of stewardship ofour common wealth and sustainability of the commongood.” Being the steward of the world’s largestpetroleum reserve brings certain responsibilities withit. He recommends a bold plan of diverting one-thirdof oil royalties from the oilsands to pay for and builda sustainable energy future for the world. Such along term plan would use the existing facilities of theClimate Changes and Emissions Management Fund.Funding methods would range from venture capital toequity stakes to public-private partnerships.A second essay examining the energy sector is RobertRoach’s piece about Alberta leading a nationalconversation on an energy strategy. Roach recommendsestablishing a strategy that goes beyond the often heardchorus of complaints when gasoline prices rise andresentment towards Alberta builds. He poses severalcritical questions that Alberta leadership candidatesmust consider:How will Alberta’s and Canada’s energy exportmarkets change and what do we need to be doingto prepare for these changes? How will Albertaand Canada be meeting its domestic energyrequirements in twenty years? How do we continueto improve environmental stewardship on the partof both producers and consumers?His essay identifies eight basic themes around energythat should inform and establish an agenda forfederal-provincial energy discussions.The final essay by Bob Ascah looks at the question ofwhether Alberta Treasury Branches (ATB) should besold or retained by the provincial government. Notingthe significant size of ATB as a homegrown financialinstitution, he outlines the arguments for and againstATB privatization. Ascah argues that ATB has playeda role of economic stabilizer in the past and remainsimportant in rural communities. On the other side,ATB has periodically faced financial problems whichthe provincial government, as guarantor of ATB’sliabilities, must meet. While taking no position on thequestion of privatization, he notes that in 2012, theLegislative Assembly will debate the continuance ofATB. He encourages the new Premier to engage thepublic in a broader public debate about this importantAlberta institution.becoming alberta’s next premier | june 2011 | | bob ascahiibob ascah | June 15, 2011

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