What a difference a week makes in politics

Budget leaves the PCs vulnerable while Wildrose spirits are revived

Harold Wilson, one of the craftiest of British prime ministers, once remarked that a week is a long time in politics. At no time has such Machiavellian insight received stronger endorsement than this past week in Alberta.

The budget exposed the vulnerability of the PC machine; the election of Brian Jean, a former federal Conservative caucus- mate of Jim Prentice, revived the waning spirit of Wildrose.

Who could have foreseen these events?

We’ve had six months of gloomy warning from Prentice. There “will be no more business as usual.” There will be “tough decisions” because Alberta is in “the most serious market and financial circumstances in 25 years.”

Accordingly, “everything is on the table” and significant spending cuts are inevitable.

Such words enabled the PCs to gut the official Opposition when Danielle Smith was persuaded by them to lead most of her caucus across the floor. The pre- budget address promised a transformed financial future. Commentators said the government would require a mandate from the electorate to implement it. Prentice said it would be “bold” and a “real gamechanger.”

Evidence of a budgetary crisis resulting from out- ofcontrol spending is not news. Per capita program spending in Alberta is $ 10,880, compared to $ 8,884 in B. C.

Ken Boessenkool’s and Ben Eisen’s 2012 study for the School of Public Policy showed that public- sector wages have grown 119 per cent during the first decade of the 21st century, compared to 63 per cent in the rest of the country. In 2010, Alberta bureaucrats cost over $ 83,000 a head, compared to the national average of $ 62,000. In 2013, Alberta Health Services employed 9,800 persons who took home over $ 100,000, up from 4,700 four years earlier.

Any budget crisis balances three relevant factors: tax and fee increases, spending cuts and increased deficits. A “transformative budget” promised rough equality among them.

The actual result? Taxes up 22 per cent; cuts up seven per cent; deficit up 72 per cent. Some balance! Here are some details. First, the elephant- sized omission.

As longtime economic adviser Sherry Cooper ( no relation) observed, a sales tax is “a source of income that doesn’t fluctuate nearly as much as oil prices.” Result? No sales tax. Instead, the Klein- era flat income tax was replaced by a barely noticeable progressive one. Health- care premiums will bring in about a third of what was collected in 2009 when they were cancelled, and health- care spending is down a derisory one per cent.

Other changes are simply weird.

Mid- sized breweries such as Big Rock, which produce drinkable beer, will pay higher taxes than the multinational producers of industrial swill.

The charitable income- tax credit was reduced from 21 to 12.5 per cent, thus increasing the dependence of the arts and culture on government spending and reducing the incentives for Albertans to exercise the virtue of liberality.

Two explanations suggest themselves.

Either the PCs are convinced they’ll be the first jurisdiction anywhere to spend and tax its way to prosperity, or, as Machiavelli advised in The Prince, they promise frugality but avoid incurring hatred and contempt by practicing it.

Bad news for the PC machine was balanced by good news for Wildrose. Whether Danielle Smith was naive or deceived by the promise of fiscal conservatism in a Prentice- led party no longer matters. Simultaneously, as Wildrose chose her replacement as leader, the PCs denied her the nomination in Highwood.

Two of the sheep she led across the floor, Gary Bikman and Rod Fox, also failed to win PC nominations.

Events of the past week can hardly be said to presage a Wildrose victory in the next election. But events have certainly repositioned both parties.

Harold Wilson was right.