Alberta Politics Thread

[Tacopuck]

Originally Posted by CaptainCrunch

As much as the government wants to deny it, they are going to have to start cutting serious costs, they can't keep borrowing at an ever increasing rate just to keep their voter base employed.

Ceci was pressed this a few times during the Q&A. Few reporters asked how high would the debt have to go before he would have to change his mind about cuts.

Ceci's response: If we stick to the plan we will be okay.

When the reporters further pressed how high the deficit would have to go that would trigger spending cuts (ie 20% of GDP)

Ceci's response: I wont answer questions about hypothetical situations.

Ummmm having a ceiling (or a floor) as part of "your plan" is not a hypothetical its basic financial planning and contingency options. You know like a worst case scenario....

Ceci is no good.... at his job....

[Tron_fdc]

Originally Posted by CaptainCrunch

As much as the government wants to deny it, they are going to have to start cutting serious costs, they can't keep borrowing at an ever increasing rate just to keep their voter base employed.

I think that their voting base is seeing an impending bloodbath at some point here too. 3 years is going to come pretty quickly; faster than the NDP would like.

I feel sorry for the next government that tries to clean up this mess. AUPE and their like won't let go of any increases they have been given without a HUGE fight. Can't wait for the impending parade of striking public employees when someone tries to rein in spending.

What a disaster.

[Wiggum_PI]

Originally Posted by Ashasx

I guess the argument could be that it would have gone down more if the rate hadn't gone up.

It's not always that simple though. If taxes are increased so much that a business can no longer stay operating, the government effectively gets zero tax revenue now from that business.

[Slava]

Originally Posted by Tron_fdc

This makes me furious.

If the government was a business, they would have been laughed out of the meeting with their financiers, and be declaring bankruptcy.

Banks sh*t bricks when you borrow to cover operations cost. Why is no one pointing that out to these idiots? It's ok because they were voted in, therefore have carte blanche to write themselves massive cheques? Or do they not understand simple financial math?

"Revenue minus costs is a negative. Hmmmm I know, let's write a cheque from our LOC to pay ourselves more! Double meat day boys"!!

I think it's been pointed out though. I brought it up with my MLA when they released the budget and this became apparent. His response was horrifying, IMO, because it was something like 'we don't want to lay people off when there are already so many unemployed people'. I'm paraphrasing, to be clear, but that's unbelievable. They just have no legitimate plan for anything.

[crazy_eoj]

And we've come full circle. The next leader of Alberta will be forced to make drastic cuts just to balance the budget. And all we will hear for decades is how they 'gutted health care' and 'sold out our children's education' from union mouthpieces.

Hopefully next time they will remember that when spending is ludicrous, our REAL outcomes were never any better than after the cuts.

So sad to see what we've done with Ralph's legacy.

[belsarius]

Originally Posted by Wiggum_PI

It's not always that simple though. If taxes are increased so much that a business can no longer stay operating, the government effectively gets zero tax revenue now from that business.

Corporate Income Taxes are taken on profit and not revenue. Projects and new investment that requires a specific ROI may be delayed or shelved but the average business won't go out of business by paying an extra 2% on their profits.

If they can generate the profit to have to pay a tax then they are healthy enough to stay operating, I've never heard of a company closing it's doors because it makes slightly less money than it made yesterday. They close when they stop making money and usually by that time they haven't been paying taxes in a long time.

[Wiggum_PI]

Originally Posted by belsarius

Corporate Income Taxes are taken on profit and not revenue. Projects and new investment that requires a specific ROI may be delayed or shelved but the average business won't go out of business by paying an extra 2% on their profits.

If they can generate the profit to have to pay a tax then they are healthy enough to stay operating, I've never heard of a company closing it's doors because it makes slightly less money than it made yesterday. They close when they stop making money and usually by that time they haven't been paying taxes in a long time.

Good point, I guess I was thinking more about small businesses, but they are subject to different tax rates then large corporations.

[Fuzz]

I hate to have to defend the NDP here, but the PC's spent decades setting us up for this colossal disaster. It isn't something that can be fixed in a year or 2. Let's not wax poetic about King Ralph....

That being said, of course the NDP are doing a terrible job of managing this crisis.

[CliffFletcher]

Prentice was right; Albertans need to look in the mirror.

[crazy_eoj]

Originally Posted by belsarius

Corporate Income Taxes are taken on profit and not revenue. Projects and new investment that requires a specific ROI may be delayed or shelved but the average business won't go out of business by paying an extra 2% on their profits.

If they can generate the profit to have to pay a tax then they are healthy enough to stay operating, I've never heard of a company closing it's doors because it makes slightly less money than it made yesterday. They close when they stop making money and usually by that time they haven't been paying taxes in a long time.

However, their profit is calculated after huge paying huge increases in Property Tax (already in place), Minimum Wage increases (coming), Carbon Tax (coming), CPP increasing (coming).

And we wonder why businesses are choosing to close up shop or delay/cancel projects entirely. Business income tax is only one part of the equation, and the mountain of increased costs for business is truly strangling the economy.

[Slava]

Originally Posted by CliffFletcher

Stelmach was right; Albertans need to look in the mirror.

Prentice...

[Slava]

Originally Posted by crazy_eoj

However, their profit is calculated after huge paying huge increases in Property Tax (already in place), Minimum Wage increases (coming), Carbon Tax (coming), CPP increasing (coming).

And we wonder why businesses are choosing to close up shop or delay/cancel projects entirely. Business income tax is only one part of the equation, and the mountain of increased costs for business is truly strangling the economy.

This is just not true though. The taxes aren't in yet to for the most part, so the issue for business at this point is more one of the general economy. I mean yeah, the increased taxes we've seen aren't helpful at this point, but when you have 3/4 in your post that haven't even become a factor yet we can't blame those issues.

[killer_carlson]

the decision on the hospital laundry is an example of a partisan interest over economic.

http://www.cbc.ca/news/canada/edmont...ices-1.3725703

[belsarius]

Originally Posted by killer_carlson

the decision on the hospital laundry is an example of a partisan interest over economic.

http://www.cbc.ca/news/canada/edmont...ices-1.3725703

Not at all. The decision to privatize was done by the old PC way of getting things done, given me two options and make sure one is the one I like. What they want now is an actual business model that shows how privatizing is better in the long run.

Any business would want a review and business plan done before making a decision like that. It was partisan interests that pushed for privatizing in the first place.

"Hoffman asked AHS to show how privatization was better than keeping the existing facilities"

Due diligence, I know it's new to Alberta governance but it makes sense.

[CaptainCrunch]

Originally Posted by Fuzz

I hate to have to defend the NDP here, but the PC's spent decades setting us up for this colossal disaster. It isn't something that can be fixed in a year or 2. Let's not wax poetic about King Ralph....

That being said, of course the NDP are doing a terrible job of managing this crisis.

We can keep blaming the PC's and good lord, they need to be lined up and kicked in the sensitive regions repeatedly, but the bottom line is that operating costs are increasing and they were un-affordable at the time of the election.

At some point the NDP can whine all they want about laying off people and cutting services. but the time is coming when that decision will be taken away out of economic reality.

We're too inefficient and too mid and top heavy in the public service, and we have a unafordable cost structure.

[Resolute 14]

I might buy the "it's oversight not ideology" argument if this government didn't already have a rather long record of putting ideology ahead of the best interest of the public.

Also, AHS already showed how privatization was better than keeping the existing facilities: The existing facilities are aging, falling apart, are in danger of failing to meet infection control standards, and would cost hundreds of millions of dollars to upgrade.

[CliffFletcher]

Originally Posted by Slava

Prentice...

Er, right

[para transit fellow]

With the ahs laundry thing, I really wonder if it is cheaper to truck every thing to the facility in Edmonton than the depreciation on the regional laundry facilities.

But my other thought is, what happens to laundry costs after several years of privatization. Would we have a single provider large enough to take a lock on the whole province and an extreme lack of competitors.

[crazy_eoj]

Originally Posted by Slava

This is just not true though. The taxes aren't in yet to for the most part, so the issue for business at this point is more one of the general economy. I mean yeah, the increased taxes we've seen aren't helpful at this point, but when you have 3/4 in your post that haven't even become a factor yet we can't blame those issues.

I thought you were in the business of financial planning? Do you not advise clients to make decisions based on future cash flows? Do you tell them to go ahead and spend 100% of their earning because you can't factor in anything for next year or beyond anyways?

Every business owner is looking at a terrible economy, and a government(s) that does nothing but increase costs (income tax, property tax) and promise to further increase costs (minimum wage, Carbon Tax, CPP), and you wonder why so many are opting to close up shop? It has everything to do with a total erosion of business confidence today and tomorrow.

[chemgear]

http://business.financialpost.com/fp...ow-revenues-go

Alberta is now on the hook now for over $1 billion in debt interest payments this year, which will only pull the province deeper into the inky abyss.

Ceci has made it clear the plan is to keep spending, no matter how badly revenues dry up, framing it, as he routinely does, as a choice between either that or “reckless cuts to vital public services.” Such vital services now include laundry services, as taxpayers discovered last week when Postmedia revealed that the health ministry cancelled plans to outsource the washing of hospital linens that would have saved millions in equipment upgrades, because it would have also moved some jobs done by public-sector workers to a private firm.

In just the last year, Alberta added 47,000 public-sector workers to the payroll. What’s vital to the NDP is apparently not just refusing to cut spending, or merely hold the line on spending, but to always keep doing more of it, no matter how little money comes in. Whether Rachel Notley’s government is doing enough to reduce Alberta’s dependence on oil isn’t the issue; it’s that her government’s spending is no longer dependent on anything.

http://business.financialpost.com/fp...e-than-Ontario

Specifically, like Ontario, Alberta is now running large, sustained budget deficits. In fact, a look at the numbers reveals Alberta is currently faring even worse than Ontario in the years following the financial crisis when it comes to controlling the size of annual budget deficits.

It’s therefore alarming that Alberta is now running deficits that are even larger than those run in Ontario during the very worst years of the “great recession.”

Once next year’s projection is factored into the equation, the inescapable reality becomes clear—Alberta is running even bigger deficits than Ontario did during the worst years of its ongoing debt binge.