CAN A SOCIALIST NDP RUN
ALBERTA INTO A HOLE?
The Alberta NDP are bitching and complaining again, Nov. 26, 2020. This time its about the UCP not taking $300 million from the Federal Liberals. Money with strings attached. The string being for every dollar the feds give, the province has to spend a dollar, sounds great! The reality is, it is not. Since Alberta already has a spiraling debt load, courtesy of the NDP and previous management, any new debt will be paid off last. That new debt will accrue interest from its inception to its end. The $1 Million to get $3 million, if paid off in 30 years at a 6% average interest is;
Alberta’s total debt as indicated by the “Alberta Debt Clock” is;
There was enough news stories out there by the left wing NDP loving news media (CBC. CTV, Global and others) about how the Kenny government was not partaking in what they called a $300 million federal – provincial cost shared program for frontline workers in Alberta. You can read the whole disgruntled “Trench Mouth Notley” tirade and untruths in the article below.
There was only a few news articles that reported that the UCP had said it was working on the program with the feds. The UCP was not going to report on the negotiations it was having with the feds, simply because the left wing media mob and “Trench Mouth Notley” would only try to disrupt, and degrade any deal the UCP was working on. The UCP was trying to negotiate for a more diverse group of people who could be eligible for the benefits. But that is never even mentioned.
On February 10, 2021 the UCP released the results of its negotiation with the Feds. The sum for most frontline workers was a lump sum payment of $1200. The UCP said it was still attempting to get the federal government to add some worker classifications to the package, like teacher’s aids. The total amount of the package and complete details was reported by the “Vancouver is Awesome” site. You can read in detail the aid package.
You can also read the about it from the Red Deer Advocate that gets all the negative labor and NDP comments.
There is no way to please the NDP’s “Trench Mouth Notley” or labor unions in Alberta. They all seem to be intent on one thing, degrading the UCP and getting the spend crazy, retarded moronic NDP and “Trench Mouth Notley” elected.
Perhaps the approach the UCP is taking by reducing the deficient, balancing the budget, and then attacking the debt, makes a little more sense than spending another $65 billion like Rachel Notley and the NDP did. There is a article at the end of the blog that explains in detail the options a province has when it can’t pay the interest on its loans.
Excessive spending by a government to secure the votes of its base and other weak minded minions is a recipe for disaster. Alberta floated some bonds for around 3%, so if the province borrowed all the debt it has accumulated at an average of 6% the total debt interest on $90 billion if paid off after 20 years is;
On August 25, 2020 the NDP School Critic Sara Hoffman made some comments on Alberta receiving $262.8 million dollars of Federal money for schools because of this pandemic. As always Sara ran down the existing Alberta Government, and then proceeded to tell the government and Albertans how to run the Province. We all know the socialist NDP’s record of putting Alberta into the biggest debt hole ever. The NDP platform of spend till you bleed, only applies to the poor. Poor people are tired of bleeding for the NDP and the AUPE in Alberta. The Alberta Union of Public Employees (AUPE) are like bloodsuckers, they latch on, and suck the blood of the host, without any concern for the host, the host being the people of Alberta. The Alberta NDP’s Socialist Democracy platform works well for the AUPE’s, faithful followers, as they are NDP minions.
Definition of minion
1: a servile dependent, follower, or underling. He’s one of the boss’s minions.
Sara Hoffman also said in her address to the public that;
“The UCP government shouldn’t have needed the federal government to bail them out by providing the additional funding”.
“The money should have been out the door back when the government was getting ready to reopen schools months ago,” Hoffman said. “There should have been a plan from the provincial government about how they would do that safely. I’m glad that we have some money coming, but I don’t think it will be enough.”
You remember that on November 26, 2020 (above) the NDP and “Trench Mouth Notley” were screaming at the UCP to take a government handout. The NDP and “Trench Mouth” are almost deplorables. Between “Trench Mouth” calling the UCP party members “Racist and Sara Hoffman calling the workers of Alberta “Sewer Rats” we should all know who not to listen to or vote for!
Why would Sara Hoffman be bitching about the UCP taking money with no strings attached from the federal government? Sweet little Sara bitched about the money because she just couldn’t stand anything good coming to Alberta children from the UCP, also the money couldn’t be manipulated by the NDP and the AUPE. That 262.8 million from the feds could be spent as seen fit by the UCP, and poor little Sara, Rachel and the rest of the NDP minions couldn’t divide it up among themselves.
The UCP government told the school boards to spend the approximately $365 million they had in reserves for extra costs associated with Covid 19. Imagine the quandary the NDP and their minions were in, they had $365 million in their little nest egg hidden away from the public eye, and now were told to spend it on schools and not themselves. The very hate that shot through the NDP establishment for the UCP must have been tumultuous. Imagine having a Conservative Government telling school boards how to spend their piggy bank money. We will look to see how that $365 million was spent, but that distribution of funds would be covered up by NDP minions.
This is the Alberta Teachers Association (ATA) directive on how the $262.8 should be spent;
The ATA welcomed the federal money even if the NDP called it a handout, and of course suggested that the province ensure the funds make it to classrooms and were classified as “additional funds” and not used as a source of payment to ATA personal.
The quote; “First and foremost, funding should be focused on significant staffing needs,” said ATA president Jason Schilling. “More teachers are needed to reduce class sizes, “custodians are needed to ensure that ongoing sanitization occurs throughout the school day, to help student more (educational assistants) are needed with learning needs and hygiene.”
The UCP had already spent approximately 10 million on PPE for schools, but no amount is enough when it comes from the poor taxpayer and is supposedly needed by the ATA. The ATA knows that there are people already in place to sanitize schools, but the ATA couldn’t help but try and suggest that if they didn’t get the money, Alberta kids were going to be forced back into dirty, Covid infected school classrooms.
Sara didn’t miss a beat in telling all that, the great handlers of money and spending, the NDP, had estimated that a back to school program, most certainly concocted by the so called intelligence the NDP had garnered while in power, would cost the taxpayer the small sum of $1 Billion. Then she had the unmitigated gall to demand that 75% of that $1 Billion should be spent on staffing alone. Sara then said the $1 Billion could come from the UCP reversing the corporate tax cut, Kenney had plans to reduced the corporate tax, set by the NDP at 12% to 8% over four years, so even by revering the tax cut, there would not be $1 Billion available in the first year for the NDP pipe dream. The total tax cut after 4 years was estimated to be $1.6 billion in total. The NDP knew this, but reality is not an Socialist NDP quality. What was the government going to cut the next year and the next to support the $750 million increase in teachers wages. Smear campaigns and half truths are the forte of all socialists and the NDP, experts at it, are always pitting big corporations against the non AUPE worker.
Lets look at what corporate tax cuts do for Alberta in the whole. Corporate tax cuts lead to several positive economic effects. The cut encourages investment in Alberta, investment grows capital stock, When capital grows the demand for an increased labor force grows, and that leads to more productivity, more employment and better wages for workers.
The NDP have falsely made people believe that a corporate tax hike is no good for workers in the market place. Corporate tax cuts or raises have little to do with people hired by the government, their wages are not tied to corporate taxation, as they suck directly off the socialist teat. The hard working Albertan has been heard to say that milk from the socialist teat has a somewhat bitter taste and curdles in their stomach.
When a government raises the corporate tax, the cost of capital increases, e.g. machines, production equipment, transportation and so on. When capital costs more, investors are wary about investing large sums of money, and that leads to a reduction in the overall economy. Studies have show that corporate tax increases are the most regressive of all taxes used by government. Capital is often only thought of as fixtures, but capital is money and money is very fluid. If the province next door is stable with a government that understands economics and has a lower corporate tax rate, an owner wanting to invest large amounts of capital in a business would be drawn to that province on its tax rate and government alone. The NDP neither understands world economics or how the corporate tax influences economic growth.
The sad and sick thing about the NDP’s approach to Alberta’s economy is that Rachel Notley, since getting out of school has had a permanent place at the socialist government teat. She has been an activist leader, race caller, and Socialist Premier. She only has one shot at regaining her throne and that is to convince more people other than herself and the union employees of Alberta that sour, socialist milk just takes time to get used to.
What happens if New Brunswick defaults on its debt?
Federal government has 3 options if the province is unable to pay interest on debt
It’s a hypothetical scenario that seemed ever-so-slightly less hypothetical this week: what would happen if the New Brunswick government defaulted on its debt?
A report by the Dominion Bond Rating Service said the agency was shifting its assessment of New Brunswick’s economy from “stable” to “negative” — reflecting a worsening fiscal outlook for the province.
DBRS said it’s all but certain it will downgrade the province’s credit rating, which would lead banks to charge the province higher interest rates on the money it borrows. The province expects to spend $675 million on debt-interest charges in the coming year.
But what is likely to unfold if that downward spiral continues and the province finds itself unable to even make interest payments?
What would government do?
Don Drummond found himself among top civil servants grappling with that question in 1991, when he was an assistant deputy minister in the federal Department of Finance in Ottawa.
Saskatchewan’s debt had jumped in a single year from 17 per cent of GDP to 28 per cent. Banks were threatening to stop lending the province money.
Drummond and other officials “did a lot of internal work at that time trying to figure out first of all what [our] obligations were, in terms of the constitution and in terms of the legality,” he said in an interview.
They also discussed whether Ottawa would have “almost a moral obligation” to bail out a bankrupt province, given Saskatchewan’s collapse might scare off investors from Canada as a whole.
Roy Romanow’s newly elected NDP government was in touch with Ottawa about what might happen.
“There was, as I recall, some talk of a provision which would allow the federal government to move in and kind of act as a bankruptcy trustee,” Romanow said.
“It would in effect put the government, the elected government of the province of Saskatchewan, under the effective decision-making control of another agency.”
Romanow said he wasn’t going to let that happen. He used the threat of resignation to force his reluctant caucus to accept tough measures, including a tax increase, spending cuts and the closure of 52 rural hospitals.
The budget was balanced in three years, and the key question — what would happen in a default — remained unanswered.
In 1940, banks refused to refinance the New Brunswick government bonds, according to a paper by historian R.A. Young. But a wartime economic boom lifted the economy enough to postpone tough decisions.
A decade later, with a new bond crisis looming, the Liberal government of John McNair imposed a four per cent sales tax to boost revenue, contributing to its election defeat in 1952.
If a province did go bankrupt, Ottawa would have three options, Drummond said: direct financial assistance, a loan or a guarantee of the province’s debt — an assurance to banks that would let the province continue borrowing.
He figures a federal government would have little choice. “If you have a province go down, it is a reputational investor risk for the whole country, so it’s not just a local matter.”
New Brunswick isn’t near that cliff yet. The province’s credit rating from DBRS is still “A-high,” and some analysts believe Newfoundland and Labrador is closer to an eventual default.
But the release from DBRS said it will be hard to reverse New Brunswick’s slow but steady economic deterioration, and that makes a credit downgrade likely after the next budget.
“That’s not to say it can’t happen. Our view is that it is not likely we will see a significant enough improvement to alter the course and ultimately cause us to not downgrade the rating in the coming year.”
Eventual impact likely
Auditor-General Kim MacPherson said last year that the province’s growing debt “may eventually impact” its ability to meet its financial obligations, including payments on the debt.
Drummond agreed with DBRS that New Brunswick’s aging population presents a double challenge: there are more people who need more expensive health care and fewer working-age people to generate the economic growth to pay for it.
Finance Minister Cathy Rogers said this week the province is tackling that very issue, including with $20 million in new spending on senior care.
“Where [DBRS] identified our challenges is exactly where we are focused. So I don’t know what else we could do,” she said.
But the Liberal approach is to spend more money to fix the problem, which only adds to the debt and pushes back the target for a balanced budget to 2022.
New spending needed says Rogers
DBRS said that repeated pushing back of the target led it to question the credibility of the current government’s fiscal plan. The PC government of David Alward originally promised to balance the budget in 2014-15.
Rogers said the new spending this year is needed to boost the economy. More money for education will produce a better workforce, she said.
But Drummond said many of those better-educated graduates are likely to leave the province for better jobs. Another problem DBRS flagged is a lack of major private-sector capital spending on the horizon, meaning slow economic growth and fewer job opportunities.
“Unless you can shake that, it’s hard to see how this comes to a happy end,” Drummond said.
He said any federal bailout would probably come with strict conditions, including a strict deadline for the province to get the budget balanced quickly.
“You almost have an obligation to Canadian taxpayers to not do it, unless there’s some kind of agreement and some kind of assurance,” he said.
And even that wouldn’t be the end of the crisis, because while a balanced budget would stop the debt from getting bigger, it would take years and years of surpluses to actually reduce it.
“The problem doesn’t go away” with a federal bailout, Drummond said. “That’s just the first step.”
Romanow said he doesn’t envy the Gallant government’s position “but if I were to offer any advice … I would say devise a clear plan, explain it to the public, why it is necessary and do it.
“That means making a decision you’re ready to go down to defeat politically, but you do so with the knowledge you’re doing the right thing for the people of New Brunswick.”