Alberta budget news

[Senator Clay Davis]

Haha oh Rerun...you should probably quit while you're behind. Slava is one of the smartest guys here on financial stuff, and you....are great at making threads about your dog. I think you guys should both stick to what you're good at.

[Tinordi]

Originally Posted by crazy_eoj

For someone claiming to be so smart you sure spout a lot of nonsense.

The Wildrose Party was going to put 50% of surplus dollars back into the heritage trust fund. 20% was to be paid directly back to Albertans as a dividend cheque. And the remainder was earmarked for health/education/municipalities.

I know you hate all things conservative but there's no reason to outright lie to support your points.

The point still stands, rebating surpluses back to voters is idiotic. Very much agree that recapitalizing the Heritage Fund is a great idea. But the basic WRP premise is still faulty. You cannot cut services to balance the budget. This is a revenue problem.

[bizaro86]

Originally Posted by Tinordi

The point still stands, rebating surpluses back to voters is idiotic. Very much agree that recapitalizing the Heritage Fund is a great idea. But the basic WRP premise is still faulty. You cannot cut services to balance the budget. This is a revenue problem.

I think it would be an interesting exercise to see if Alberta could dedicated non-renewable resource revenues to only capital projects and the heritage trust fund, with income from the heritage trust fund paying for operating needs.

If that became law I wonder what the compromise would be between lower spending and higher taxation.

[Handsome B. Wonderful]

Originally Posted by Tinordi

You cannot cut services to balance the budget. This is a revenue problem.

You can always cut services.

[Tinordi]

Originally Posted by Handsome B. Wonderful

You can always cut services.

Ok well PM fotze and tell me where you would start.

[Tinordi]

Counting down until someone says "waste"

In

3...

2...

1...

[crazy_eoj]

Originally Posted by Tinordi

The point still stands, rebating surpluses back to voters is idiotic. Very much agree that recapitalizing the Heritage Fund is a great idea. But the basic WRP premise is still faulty. You cannot cut services to balance the budget. This is a revenue problem.

Your point doesn't stand at all because it wasn't true.

Regardless of that, you can cut services, and Alberta, of all provinces, definitely doesn't have a revenue problem.

[Rerun]

Originally Posted by Senator Clay Davis

Haha oh Rerun...you should probably quit while you're behind. Slava is one of the smartest guys here on financial stuff, and you....are great at making threads about your dog. I think you guys should both stick to what you're good at.

I can't. J pold doesn't like it when I start threads about my dog, or dogs in general I think. ... actually when I come to think about it, J pold doesn't like any of the threads I start.

[Tinordi]

Originally Posted by crazy_eoj

Your point doesn't stand at all because it wasn't true.

Regardless of that, you can cut services, and Alberta, of all provinces, definitely doesn't have a revenue problem.

Uhm, you yourself said that they would rebate surpluses back to voters. How is it not true?

On service cuts, PM fotze and then tell me where you're going to cut to get the budget balanced.

Even if you're able to do that, that's still besides the point of wasting non-renewable resource revenues to support an artificially low tax rate.

[Flash Walken]

Close loopholes.

End entitlements.

[crazy_eoj]

Originally Posted by Tinordi

Uhm, you yourself said that they would rebate surpluses back to voters. How is it not true?

On service cuts, PM fotze and then tell me where you're going to cut to get the budget balanced.

Even if you're able to do that, that's still besides the point of wasting non-renewable resource revenues to support an artificially low tax rate.

You said the the WRP was going to send all budget surpluses directly back to voters as cash, which they never said at all. Full Stop.

Then you claimed you CAN'T cut services, which is probably the dumbest thing posted in this thread. Even fotze has admitted he doesn't have detailed expenditure data in his spreadsheet so why bother discussing details?

[V]

Originally Posted by Slava

Ok, let me explain this:

...(and granted the time frames here somewhat selective)...

Somewhat selective? Good Lord, you cherry picked the worst case scenario over the last 30 years, and you still couldn't come up with a scenario that lost money.

I'm all for caution and trepidation in the housing market, especially now, but I don't know if you could possibly be more obtuse with this argument.

[CaptainCrunch]

Originally Posted by GP_Matt

The better question is how can two different provinces be so different on their prediction of the price of oil. Alberta based their budget on a much higher price for royalties and when it didn't materialize they ended up with a deficit.

the difference is that one government built a exagerated picture of revenues and overall health to basically win an election.

The other government actually knows what their doing.


And I appreciate the idea of Fotze spreadsheet, but in order to talk about cuts, you can't really look at it from a general category sense, I think you have to get pretty granular.

[Mr.Coffee]

Originally Posted by kirant

This is part of it. The changes on the royalty rate on the oil sands is directly tied to the WTI pricing of oil.

Additionally, I think Stelmach provided an out for some groups building in the Oil Sands by letting them pay a really, really low royalty instead of 25% flat until construction is done (but also allowing expansions to be considered part of construction), creating a situation where companies are building massive plants. I'm not sure on the entire details of this, but this is the narrative I'm familiar with, that the ongoing construction is reducing royalty income.

It's not necessarily just royalty revenue. I feel I must do my duty as landman in here haha...

landsales calendar 2011 = $3.536 Billion to Alberta..
landsales calendar 2012 = $1.11 Billion to Alberta..

http://www.energy.alberta.ca/Tenure/834.asp

So basically a net loss of +2 billion to the province.

That's a lot of dough to miss. What I'm not sure about is did the AB government try and rely on this pace of landsale revenues when it already sold the rights?

2011, people can thank the Montney and Duvernay for that, particularly I think it was the July 7 or so 2011 sale. It was astronomical what people were bidding.

Hope the province wasn't banking on that money this year, and they sure as #### shouldn't bank on it next year.

[1stLand]

I told you females (redford) are terrible at balancing the cheque book

[Slava]

Originally Posted by V

Somewhat selective? Good Lord, you cherry picked the worst case scenario over the last 30 years, and you still couldn't come up with a scenario that lost money.

I'm all for caution and trepidation in the housing market, especially now, but I don't know if you could possibly be more obtuse with this argument.

Well that time frame also had the highest spike? The worst case would've been to stop before the boom.

Anyway, for the second time I'm not suggesting that people don't buy houses. I own one and don't think its the worst thing you can do with your money either.

[Mr.Coffee]

how does health care and education take up that much? It's crazy, who is in charge of cost control in those budget items?

Is there any way to view specifics in those budget categories? The sad thing is the state of affairs of our health care system considering...

[Mr.Coffee]

for sure you are right, I just find it kind of amazing. I am sure it is an intricate problem though (cost control).

Building a new hospital can't be cheap either.

[GP_Matt]

Originally Posted by Tinordi

Ok well PM fotze and tell me where you would start.

There is no easy solution to the budget problem but years of government waste hasn't helped the problem. They are in this position because of both revenue and expenses, but I don't think it can be fixed this year.
The governments biggest cost is salaries though and the only way to lower that is to lay people off, freeze hiring or lower salaries. IMO lowering salaries doesn't work, if you take something away from people they will be unhappy until they get it back. I think the problem is that the government was too lenient in negotiating with unions but I have no idea how that can be fixed.

[Mean Mr. Mustard]

Originally Posted by GP_Matt

There is no easy solution to the budget problem but years of government waste hasn't helped the problem. They are in this position because of both revenue and expenses, but I don't think it can be fixed this year.
The governments biggest cost is salaries though and the only way to lower that is to lay people off, freeze hiring or lower salaries. IMO lowering salaries doesn't work, if you take something away from people they will be unhappy until they get it back. I think the problem is that the government was too lenient in negotiating with unions but I have no idea how that can be fixed.

The problem is that Alberta is in an economic boom causing the cost of living to go up. You have to spend more on labour as a result. The days of cheap labour in Alberta are gone, at least for the foreseeable future and we squandered our chance to get vital infrastructure projects done at a reduced cost relative to what it will be now when the cost of products and labour has increased. I don't like some of the tactics employed by unions but by and large this is the downside of living in a province that is going through an economic boom, everything costs more, including labour.


Figure out where to start laying people off. Seriously, which government departments are soaking up billions of dollars of waste?