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To hear the politicians talk you would think the one and only thing that matters in Alberta is oil.

That's the single focus in Alberta politics.  There is an oily tide of outrage about the current woes of the province's oil patch sweeping all other concerns out of its path.

There's actually little difference between the United Conservative Party and the NDP on the tone or message.  Everyone is making life difficult for Alberta's prime resource and that has to stop.  Pipelines must be built.  Quebec must express desire for our oil bounty.  The world in general must pay a fair dollar for Alberta's barrels.

The anger is directed most squarely at Ottawa.  It's not just Rachel Notley and Jason Kenney leading the charge.  Grassroots truckers are planning to drive the message down the Yellowhead and TransCanada to Ottawa in their giant diesel-guzzling Kenworths in February.

Oil, in short, is sucking all the air out of Alberta's political culture.  It's hard to imagine what might have been done for other sectors of the economy, other needs in society, in the last 18 months if the NDP government hadn't been forced to divert so much of its attention and energy to the oilpatch.

As a provincial election nears in the spring, the campaign will boil down to whether Jason Kenney is louder and angrier about Ottawa's failure on oil than the current government.

During year end interviews Kenney unveiled a plan to create a well-funded war room in the energy department to fight back "in real time" against attacks on Alberta's primary industry by environmental organizations like the Tides Foundation and to launch legal challenges against anti-oil federal legislation.

He wants oil company executives to join the province in that fight.

Notley also vows to continue on her government's path of battling for a pipeline, taking on all comers from B.C. to Ottawa.

"Every time we have been presented with (a roadblock) we've faced it head on and fought back, and we'll keep doing that," she said to the Edmonton Journal in a year-ender.

Both the NDP and UCP have offered tentative support to the truckers movement which has seen traffic-blocking convoys pop up around the province displaying anti-Trudeau signs and demanding pipelines and an end to equalization payments.

A speaker with the group Oilfield Dads at one such protest in Rocky Mountain House said the province is suffering the "worst recession turned depression" in a generation because of lack of pipelines and low oil prices.

Economic statistics don't actually back that up.  In December various Canadian bank economists were predicting Alberta GDP growth in 2019 around the 1 to 1.5 per cent mark — not great, but not a depression either.

And what about the rest of Alberta?  There are other economic sectors which are ticking along fine that could, in the longterm, cushion the economic gap developing in the oil patch.  There are Albertans working in the tech sector and the construction sector.  Albertans are growing medicinal and recreational marijuana, protein crops and developing food processing industries.  The province is home to world class research in health care and artificial intelligence.

No doubt all those sectors have issues that could be addressed in a legislative agenda that puts some emphasis on true diversification in the province.  But the dominant theme, established in the last two years and likely to continue into the next government's mandate, remains nonrenewable oil and gas resources.

Kenney is making it very clear that he wants that single focus for the next four or so months of the campaign: all economy, specifically the oil patch economy, all the time.

Some of this is calculated to deflect voters attention away from areas that the UCP is weak on.  For instance, Kenney has come under attack for his own history of intolerance on LBGQT issues.

It also allows Kenney to campaign against Trudeau and the federal Liberals rather than directly against Notley, who still personally commands a good deal of respect in the province.

The NDP has also been captured by the oil patch agenda and has to continue its efforts to shore up western oil prices and improve transportation options.  From the beginning of its mandate, the government has known that a major pipeline win would be the ticket to a second term.  That is looking relatively impossible given an election is expected in scant months.

There may be other pressing economic, social and cultural issues which deserve attention in the upcoming Alberta election campaign, but the race is going to focus on one beleaguered and highly politicized commodity.

Photo Credit: Jeff Burney, Loonie Politics

The views, opinions and positions expressed by columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of our publication.


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The views, opinions and positions expressed by columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of our publication.


One problem newspapers face nowadays is that it's getting too easy to predict what will be in them.  For instance the federal Liberals' shiny new "Strategic Innovation Fund" is being used to prop up mature industries for political gain.  And we all saw it coming.

Or not.  The people who created it apparently didn't.  In this sense government is the opposite of a newspaper in that even those inside seem to have no idea what it does or how.

It's hard to believe we're still having this 1970s-style discussion about whether government can "spur innovation for a better Canada", a genuine quotation from the SIF website.  I thought we concluded about 25 years ago that government should not try to pick winners and losers because it was far too good at doing the latter.  (Of course we also concluded that deficits don't cure recessions and look where that insight got us.)

There are sound economic reasons why government should not "pick winners".  First, paradoxically, government is no worse than the private sector at doing so.  The whole problem lies in what it does next.

In business, if an investment isn't paying off you shut it down, writing off sunk costs, because otherwise you keep losing your own money (and time and effort).  In government, if something isn't paying off, you put more money in, because otherwise you lose prestige and it's not your money.

As "public choice theory" has rightly been insisting for about half a century, people in government are not less responsive to incentives than those outside it.  We're all human, all too human.

So the problem isn't that government makes more mistakes.  It's that it doesn't admit them and surprisingly often doesn't even recognize them.  And the bigger problem is that it seems extremely hard, for politicians, public servants and the public, to grasp this crucial reality.

I understand why we wish it were not so; if government could do half the things for us that we think it can life would get a lot better fast.  But I don't understand why we think it's not so given ample evidence and clear theory.  Which is why I worry less and less about what good policy would look like and more and more about why it is so rarely adopted.

Sure, right and left are deeply divided over what should be done, how it should be done and how it can be done.  But there is quite a bit of agreement about what each side should be championing.  And even a fair bit across the divide about what to do and how.  And yet very little of it gets championed or done.

In case you doubt me, almost nobody right, left or centre believes the tax code should be unbearably complex.  Yet almost nobody simplifies it, not even those awful right-wingers you keep reading about in newspapers but never seem to meet in the corridors of power.

I would also argue that there is substantial agreement that government should not be trying to support innovation, and at least some understanding across partisan and intellectual lines that if it tries, money will end up allocated on political not economic criteria.  (On this one there is probably more confusion in the centre than on either wing, not untypically.)  And yet you cannot get rid of the profusion of agencies devoted to fostering innovation, all of which go badly wrong not because government can't recognize a new widget but because it can't recognize a mistake.

Thus the SIF, created in October 2017, is now being used to prop up Alberta's faltering oil and gas sector, having previously put money into steel and aluminum companies in response to the innovation crisis known as Trump's tariffs.  Nobody thought either industry was suffering a sudden drop in technological creativity.  They just thought they were in trouble and people in Ottawa desperate to be seen to be doing something noticed money in the SIF and shoveled it out to bolster their public image and partisan fortunes.

The minister in charge burbled in a Christmas Day op-ed that "Simply put, the Strategic Innovation Fund makes our government a better business partner with industry to create good middle-class jobs across the country."  Later, a spokesperson for same emailed the Post about "taking decisive action to help restore competitiveness, support innovation, improve environmental performance and create more middle-class jobs."  How odd.  Liberal PR buzzwords mixed with public funding announcements.

Earlier, the SIF put money into Toyota Canada for this new-fangled automobile thing.  And of course executives of companies that get money are quick to praise the statespersons who give it to them, on the Piper-Tune Principle.

The National Post quoted one expert that ideally the fund would focus on merit and aim at commercializing promising ideas. To which one is tempted to retort gosh, what a pity we don't have private capital markets for that laudable goal. Instead I retort gosh, what makes you think this government fund will be purged of human frailty when none other has?

The Post went on "The argument is part of a long-standing debate about innovation policy in Canada. There are countless ways in which a government can funnel money toward innovative companies or ideas…" But in fact there are no ways governments can funnel money toward innovative companies or ideas, because there is no governmental "invisible hand" akin to profit and loss in the private sector to ensure that resources flow to good ideas while bad ones go into bankruptcy court.

Perhaps it's time to put public money dollars into economic education. Oh wait. The government already did. Hence public universities teach the benefits of big government.

Predictably, I am tempted to say. As soon as we start predicting it.

The views, opinions and positions expressed by columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of our publication.