Opinion: Alberta benefits from higher crude prices but anxiety also runs high

December 4, 2021 by anxietycareguide.com

Rising consumer prices are a complex issue for Alberta. The county benefits greatly from rising prices for basic commodities, but just like everyone else in the world, people here are hurting by increased costs in a still shaky economy.

The country’s inflation rate is accelerating upward along with that of other countries, including the United States, which are grappling with supply chain issues as consumer spending picks up. Families pay more for groceries, new vehicles, and fuels such as natural gas and gasoline.

The good news for oil-rich Alberta is that higher prices for refined crude oil to gasoline here and in the United States are helping the province’s finances significantly. A financial update this week showed this year’s deficit is likely to be less than a third of the size projected in the February budget.

Each $1 increase in the average price of a standard West Texas Intermediate test during a full fiscal year results in an additional $230 million in revenue for the Alberta government. Even as the cost of crude oil drops in conjunction with growing concerns about the Omicron variant of the coronavirus, prices per barrel are still $25 higher than what the Alberta government expected nine months ago. The higher prices for natural gas also help.

RBC Economics said in a report this week that Saskatchewan, Alberta and Ontario will lead the way in Canadian economic growth in 2022. Alberta’s seasonally adjusted unemployment rate fell to 7.8 percent in November, down from 15 percent in June, 2020. Jason Kinney said The recovery of the economy will have a positive effect on wages. “As the economy picks up momentum, I expect to see wage inflation to help at least some families deal with the rising cost of living,” the prime minister told reporters this week.

Although signs are pointing to recovery, the economy is still emerging from rock bottom. The county has a higher unemployment rate than others. Albertans’ famously high incomes have declined in recent years, while average incomes have grown in other provinces.

“The pandemic has created a deep hole — the deepest among counties,” RBC Economics said this week, with gross domestic product falling nearly 8 per cent last year. Alberta did not fully recover from the 2015-2016 recession when the pandemic hit.

It seems people aren’t feeling the good news relatively yet. According to a survey conducted by the Angus Reid Institute at the end of November, 52 percent of people in Alberta — a higher percentage than any other province — say this year they are feeling more stressed than most when it comes to their budget. The same survey found that Albertans are more likely than residents of any other province to say that this year they feel more emotional stress than a typical year. (Not surprisingly for a province to the west ravaged by heat, fires, floods, and landslides, British Columbia comes in second.)

Among the provinces, Alberta has the highest percentage of people, two in five, who report experiencing financial and emotional stress. (Across the country, women in the 18-34 age group are also more likely to be in this group, or all 35-54 year olds.)

The province’s NDP says Albertans have suffered more costs and pressure from the United Conservative Party’s handling of issues that include imposing the nation’s highest increases in post-secondary tuition fees over the past two years, and de-indexing personal income taxes to allow brackets to creep in. .

“It’s not Jason Kinney’s fault that the price of tomatoes or bacon went up by about 12 percent, but his mistake that tuition fees increased by 12 percent,” said financial critic Shannon Phillips.

(Mr. Kenny dismissed such criticism this week by returning to the NDP’s adoption of a carbon price, “the largest tax increase in Alberta history” when the party was in government.) THE CARBON TAX WAS RETURNED TO TAXPAYERS ANNUALLY REDUCING OUR TAXES THANKS

But there are also persistent, nagging questions about the economic hit (and reputation) that the county’s Open for Summer program has wreaked on the removal of COVID-19 health restrictions, and the delayed response associated with the fourth wave of the pandemic. The NDP continues to criticize the government over who was responsible for making the decision on the pandemic in August while the prime minister and health minister were on vacation and county hospitals became overwhelmed with the sick and dying.

The variable Omicron and questions about how bad this new boom will be has created a whole host of new economic uncertainties. Inflation will likely continue to be a global headache for months to come, and in some ways it could even get worse.

Kenny said this week that the steep rise in costs is making life more difficult for everyone. In an uncharacteristically disciplined fashion, he has not delved much into the House of Commons squabble over inflation, and the Fed’s conservative argument that excessive spending by the Trudeau government and the Bank of Canada’s quantitative easing programs is to blame. Alberta’s prime minister said simply that he was calling on Ottawa to adopt responsible monetary and fiscal policies that “don’t add fuel to the fire”.

His government is still thinking about what it can do to help Albertans. The Prime Minister said: “We are studying the measures that we may be able to take before the February budget or within its limits.” Finance Secretary Travis Toyos said in an interview in October that he would be watching through the winter to see if anyone needed help with their home heating bills as a sign of what might be considered.

“The good news is that we have an abundance of natural gas here and there and our industry’s ability to extract, process and distribute it very efficiently,” he said. “We’ll take care.”