Tuesday, September 27, 2005

Ralph Economics- A Bounty of Stupid

"It's the Economy Stupid"

The King is in his counting house, someone get him a calculator........

2.8 billion....6 billion....8 billion.....
do I hear 10 billion, or maybe 12 billion

In his last days as our lame duck Premier, Ralph is acting like he is President of a High School Students Union. And we suffer with his Ralphenomics. The link in the header takes you to my other Blog....Red Between The Lines....and stories on the Alberta Surplus

Alberta news roundup: Sept. 23


September 23, 2005

Premier says dividend cheques should keep coming

Premier Ralph Klein says dividend cheques could keep coming, so long as energy prices remain high.

Klein says Alberta's budget surplus could reach a record $8.8 billion dollars this year -- about three times what the government estimated in the spring budget.

Alberta's Liberals say the province is blowing the windfall energy wealth on gimmicky giveaways.

The NDP says Albertans deserve something better than the promise of more cheques in the mail.

Feds haven't ruled out taxing cheques

Federal and provincial officials say Ottawa has not ruled out taxing Alberta prosperity cheques bound for the province's children.

Transportation Minister Lyle Oberg says tax rebates paid to adults wouldn't be subject to Ottawa's attention.

But the minister says in theory, cheques earmarked for the youngest, unemployed Albertans theoretically would be.

Deputy Prime Minister and Edmonton MP Anne McLellan says she can't ensure that the 400-dollar payments will be exempt from taxation.

Fed says Alberta's wealth good for entire country

A federal politician who has said Alberta's energy wealth may have to flow to other provinces now says

Alberta's prosperity is good for the entire country.

Federal Transport Minister Jean Lapierre says more money in the pockets of Albertans means increased revenue for Canadian businesses.

In August, Lapierre said that a struggling manufacturing sector in Quebec may force Ottawa to intervene with a financial lifeline.

He then said that the dollars may have to come from Alberta.

Widowers' benefit program shut down

Alberta's widows and widowers benefits program is being shut down and replaced with another form of funding.

Premier Ralph Klein says the details of the new program are vague, but insists people will not simply be cut off.

A new program under Alberta Human Resources is to be in place before the existing support ends.

In 2003, the province moved to create one massive social-assistance initiative which would combine three programs into a single income-support and employment-training program.

Yep we have the lowest Welfare/AISH and other support payments in Canada, and one of the lowest minimum wages as well. But hey lets give everyone a one time bonus cheque.....

Rebate cheques not much of a legacy
Government is making things up as it goes along, unlike what occurred in Alaska
Graham Thomson
The Edmonton Journal

Sort of like Klein's surplus forecasts.

In the province's first-quarter fiscal update three weeks ago it was $2.8 billion.

Last week Klein pegged the budget surplus at $3.8 billion.

On Monday it was $6.8 billion.

By Thursday, Klein had it as high as $8.8 billion -- almost triple the forecast three weeks ago and much higher than anything that could be attributed to the recent surge in energy prices. At this rate, wait 15 minutes and it'll be worth another $7 million.

Alberta New Democrats say the situation is so screwy they might ask the province's auditor general to investigate how the government comes up with its surplus forecasts.

NDP writes auditor general to investigate revenue assumptions
The NDP Opposition wants an investigation of Alberta's revenue assumptions by the Auditor General. "You don't just forget to count six billion dollars," says Mason. "In Tory hands, our money is counted using whatever new math Ralph Klein dreams up in order to suit his political whims," he said.

The NDP suspects the government is up to no good, of course, wondering if Klein is playing a Machiavellian game with the numbers for his own devious ends. As usual, they give the government more credit for diabolical planning than it deserves.

The government is making things up as it goes along. It has no long-term, well-thought out plan for the surplus. It's as if a fiscal hurricane Katrina had breached the government's levees and flooded it with surplus cash. Klein is turning on the pumps and trying to get rid of it as fast as possible.

Last month there was no plan at all for rebate cheques, according to sources close to Klein. Back then Finance Minister Shirley McClellan was forecasting a $2.8 billion surplus. She didn't want to raise expectations and have people demanding money back.

Instead, she was leaning toward a tax cut for lower income Albertans but first she wanted to see what an in-housemreview of Alberta's tax system came up with later this year.

Then Klein got involved -- and, faster than you could sketch it on the back of a napkin, came up with the idea for rebate cheques. He's playing what he calls "retail politics," buying back the love of Albertans who deserted him in last year's election.

He keeps saying the $400 cheque is a one-time "prosperity bonus." But because he has no long-term plan for surplus money, reporters had no problem getting him to bet on the chances of a rebate cheque next year.

"If the price of oil stays where it is, yes, much better than 50 per cent," said Klein.

In perpetuity? -- asked one reporter. "If the price of oil stays where it is," responded Klein.

Undoubtedly, many Albertans will welcome the cheques, especially those left behind by boom times -- just as some outside the province will start to wonder if they should be entitled to a share of Alberta's wealth.

Klein's badly thought-out, and rushed, plan could end up making us a target for Canadians who don't live atop a sea of oil and gas, especially when they see the province's second-quarter fiscal update in November.

So, to try to head off the easterners at the pass, Klein will go on a cross-Canada tour near the end of November to explain that a prosperous Alberta means a prosperous Canada. "Keep your hands off," he'll say in the nicest way possible. It might work. Then again, his trip might be the equivalent of painting a bulls-eye on his front and hanging a "kick me" sign on his rear.

Before he explains his position to southern Ontario, he'll be explaining it to South Africa. Klein is headed there this weekend to speak to the World Petroleum Congress. His trip will also take him to Germany and Ireland -- at a cost of $70,000. Put another way, that's the equivalent of 175 rebate cheques.

For all of you who think annual rebate cheques are a great idea and who point to Alaska's annual dividend payments as a shining beacon, allow me to point out that Alaska has built up a $26-billion Permanent Fund to pay for those yearly cheques to 650,000 residents. The dividend cheques are paid out of interest earned on the fund. Alaska does not dip into the principal, nor does it turn energy revenues directly into dividend cheques as Klein has done in Alberta this year, and might continue to do for years to come.

Klein's plan is like frittering away your lottery winnings in a few years instead of living off the interest forever.

Mason to Klein: forget trip-Premier would look 'like a rodeo clown in a bullring'

Sending Premier Ralph Klein east to try and talk other provinces out of coveting Alberta's oil-driven budget surplus is like "putting a rodeo clown into a bullring," says Alberta New Democrat Leader Brian Mason. "He's just going to get everyone stirred up," he said. Klein's planned junket tour of Ontario and points east - intended to convince the rest of Canada that Alberta already contributes more than its fair share to the federation - is doomed to backfire, said Mason. "He's the one who single-handedly turned this into a national issue by his bellicose and belligerent statement: 'Hands off our money,'" he said. "I think he's the last person to go down east and tell the rest of Canada they shouldn't force Alberta to share its wealth." Rather, the premier should stay at home and develop a real plan for the province's resource revenue by consulting with Albertans, Mason said.

And this cartoon is from the Calgary Herald....in 2004, when the surplus was oh a couple of billion, reminding us that ever since King Klein was Mayor of Calgary he has always had a soft spot for 'Eastern Bastards', which should make his trip east even a bigger suckcess.

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