Premier Scott Moe and Alberta Premier Jason Kenney are talking about an equalization payments referendum – April 18, 2019,
Well, finally a discussion can be made regarding equalization payments a topic that’s been off the table for provinces with large public sectors like Quebec. Now, as I’ve stated in many other posts, what often goes overlooked is the down effect Alberta’s economy has on the provinces like British Colombia. Although British Colombia is currently not a receiver of equalization payments the reality is BC is a service sector economy. More than 4/5 of the people in BC work in service-based industries and over 76% of their GDP comes from those sectors. Small businesses make up 98% of all the businesses in BC. The sectors most fueling B.C are technology, Financials, and Construction. As many people already know Real estate is a very important factor to the B.C economy as is travel and tourism. Because these industries are currently booming, it allows BCers to be alleviated from the equalization payments discussion. However, it should be noted that in the event of an interest rate hike or any financial downturn, B.C could be the province that would be the hardest hit.
On the flipside to this, you have eastern Canada namely Have not provinces like Quebec who hired a quasi center-right politician? I think he’s center-right, but his policies sound Center Left to me, which is why on certain issues, Quebec comes across as racist. Quebec’s problem is simple, their government is too big and their province is over-regulated. When I listen to their Premier speak, it doesn’t sound like he’s going to make any systematic changes to the Quebec economy. The problem that’s, of course, going to emerge will be the issue of Pipelines. At this point, it appears that the Liberals happy days are behind them. I still picked Justin Trudeau to win the upcoming election, but I don’t mind being wrong. There appears to be a shift as Canadians are seeing trough Trudeau’s fakeness.
I’m not sure how this will translate, but one thing that’s not going away is equalizations and cutbacks on Public Spending. Now, for the first time in Canadian history, the Political Right has a platform, my problem is that the Political Right in Canada, for the most part, is represented by the Conservatives. My problem with the Conservatives in Canada is that they pick winners and losers just like the Liberals and the NDP. This problem for me is why the Liberals and the NDP can every once in a while steal an election with a socialist message. Justin Trudeau is a creation of Stephen Harper, Canadians got tired of Stephen Harper because he never really explained what made the Conservatives different from the Liberals, instead, he showed ow the Conservatives are better at spending.
The average Canadian doesn’t understand economics, the free market, freedom, and liberty. A large number of Canadians still believe that they can use the power of the State in enact social and economic changes. Now the working or employee, wages based classes in Canada tend to vote for the politicians they believe will get them more wages or protect their wages and their jobs, this belief that Government should be in the business of price controls, fuels the Leftist to demand the Government to protect their social justice causes. Now, the truth is the government shouldn’t be as involved in the economy as it is and the government shouldn’t be creating laws that allow certain groups to have moral authority over other groups. So because the Conservatives don’t tell Canadians the truth about economics, they leave the doors wide open for Leftists and the problem the could be brewing down the line are discussions between Alberta, Saskatchewan, Quebec and the rest of eastern Canada. Doug Ford is trying to get Ontario’s house in order, will he be successful? I’m not sure, but the truth of the matter is eastern Canada is broke and has been broke for a very long time.
The real problem with government intervention, namely equalization payments is that provinces that are insolvent don’t appear to be insolvent, the people in these regions don’t actually understand what true insolvency looks or feels like. As an example, in the city of Chicago, because their public sector pensions are broke, lots of cutbacks have to be made and property taxes have also been hiked. Miceal Jordan can’t get his house sold because no rich person in their right mind wants to live in a U.S State that has a pension crisis. When a Province is broke, what actually happens is that the province has to cut back on Public services. Equalization payments actually fund public services and pay for public servants. Now, it’s hard for people to be consciously aware that their economy is not sustainable as is if angel investors from Western Canada keep bailing us out.
It’s equally as hard to create innovations and create good paying jobs when a large section of the country is complacent with equalization payments. Now in most parts of eastern Canada, the reality is they could be out of debt within a few years, however, the truth is that it would take a change in attitudes and based on my knowledge is that if the Premiers in eastern Canada can simply mislead their voters about how the bills are being paid, the voters will vote according to their social beliefs.
It’s impossible to debunk a social belief when bills appear to be getting paid. Like in Venezuela for example, because Oil was paying the bills for a long period of time, which enabled their socialist economic structure on the surface to sustain itself, it was a shock to most Venezuelans when the realization hit them one day that not only were the bills not being paid, but the bills couldn’t be paid. Because their cash cow Oil, had devalued and their public sector had become so large and unchallenged that once the reality that the country was broke came into fruition the public servants, also protecting their own wealth eventually put their own interests above the interests of the people.
In a free market system, it’s never a secret when a company or a government is broke, this, of course, make people more individually responsible, it also tends to create a different type of voter, the worst thing that could happen to a nation is when the people put the majority of their trust in the government, once this becomes culture it’s a hard disease to root out, because the assumption of the people based on their own history is that the Government made my life better by taking money from one person and giving it to me. Robin Hood economics.
What worries me in the future is if the Conservatives become the majority, I’m only okay with this if the People’s Party of Canada can gain ground and have a voice. I know for a fact that by talking to people that most Canadians simply do not understand how wealth is created, who is really the most generous amongst us and also who pays the most taxes! yes, the private sector creates all the wealth, but more important than that, what I wish would be explained are the forces preventing the private sector from not only making Canada more richer but also making Canada more of a giver of knowledge. that can not only make Canadians richer but people all over the world.
Scott Moe suggests he could follow new Alberta premier’s lead on equalization referendum – CBC
Interesting times ahead.