COTO:
Cut the lavish subsidies to the oil industry and the deficit is mostly fixed. Then make more careful cuts to the rest of Government spending. Increase well-head taxes/royalties for oil and tar sands production and offset these higher costs by charging the Americans more for crude oil which they are refining and exporting for their own profit. Build one or more refineries in Western Canada and ship refined oil to the rest of Canada keeping the value added in Alberta. Diversify the Prairie economy with new energy technologies (solar, wind, wood pulp fuel, bio fuel), better agricultural practices, biotechnology and bio-engineering and bio-industrial development, sylviculture, and old-fashioned infrastructure building as an economically vibrant gateway to the north. Boost immigration to the West so that the Western population grows and off-sets the demographic dominance of the central Canadian population. Make Alberta and the Prairies hum.
Cheers.
Evilroddy.
First of all, even if we take every last dime given to the oil industry, including funding for research, funding for cleaner environmental practices, transcontinental shipping (due to the stalled pipelines), and royalty breaks/capital incentives in line with other major Alberta industries (also, in line with literally every other oil-producing state or province in North America), we only get to $2.2 billion. The 2018-2019 deficit is shaping up to be $6.7 billion, hence sticking it to Big Oil isn't going to "mostly fix" anything.
Royalty costs can't be offset "by charging the Americans more for crude oil" because, like it or not, we live in a global economy. Uncle Sam is more than happy to get his oil from OPEC, Russia, or anywhere else he pleases. In fact, Hollywood has done such a hit job on Alberta in its crusade against oil that Alberta is bordering on "lucky" the US still takes the stuff from us. It used to be we could reason with people, "This oil is cleaner, safer, more responsibly extracted, and more ethical than oil you'll find anywhere else on Earth," but the Hollywood hit squad snuffed out that advantage post haste.
Building refineries in Western Canada is a good idea, but as someone who has relatives in the industry, I can tell you with authority that it's far more easily said than done. It requires huge amounts of capital (and guess where 92% of North America's capital comes from: it starts with a "U" and ends with an "SA"), it faces all kinds of social and environmental hurdles, and it's risky due to the cyclical nature of O/G prices.
I suppose the government could invest some of the capital needed in building the refineries, but... oop... there's a few billion more in O&G subsidies they can't afford.
Diversification is important, but balanced budgets are more important at this cosmic moment in time. If you can accomplish the former
while satisfying the latter, more power to you.
Finally, immigration only gets things "humming" if the people immigrating are producing more than they're consuming from the public sector. How does one ensure this is the case? By making sure one's budget is
balanced with a modest tax load. As long as people are willing to immigrate with modest taxes and social services cut back to a level that doesn't run a deficit, immigrate away.
Because that is what the spending side of the budget consists of, tax cuts and subsidies for the oil industry.
I'm not seeing anything significant related to either in the CBC article. Which bullet point are these cuts and subsidies hidden in?
Alberta is currently underutilizing it's tax base.
:lol:
Props for finding a diplomatic way of saying "Alberta isn't taxing the absolute snot out of every warm body."
A dramatic decrease in royalty payments over the last 14 years, Dropping from a high of just over 10 billion down to around 2.2 billion in 2016. Despite oil production increasing by a good 70 over that time frame. To be honest I had no idea it had dropped that much and to that little. That drop would cover 70% of the deficit by itself.
There's something called "the price of oil", which has a (slight) impact on profits in the O&G industry, and by extension, provincial royalties.
Perhaps you'd care to overlay your royalties chart with a chart of the prices of oil and gas over the same period of time. You might notice a (slight) bit of a correlation between the two.