Stop delighting in Alberta’s misery
Alberta, a province with a population of about four million, has been dominating the country politically and economically for the past decade. But with tanking oil prices, industry layoffs, pipeline leaks, agricultural disasters and NDP political successes, many in the rest of the country are feeling a sense of schadenfreude: the delight in Alberta’s economic — and political — misfortunes.
To at least some extent, their feelings are understandable. It was not long ago that Alberta was at the top of its game: from the rise of Stephen Harper, to the increasing importance of the energy industry as central Canadian manufacturing faltered; Ontario’s debt rose and Quebec’s fiscal situation spiralled as Alberta remained blissfully debt free.
It was Alberta that boasted, by far, the highest median incomes. It was Alberta that played home base for a decade of Conservative dominance. No longer content to play the role of colonial outpost, Alberta was building ever-taller buildings, hosting more corporate head offices and electing far-less-embarrassing municipal politicians.
So to see Alberta a touch humbled by the drop in the price of oil, to watch as the provincial government’s fiscal situation deteriorated, to smirk as its pipelines have been thwarted and its food bank usage increased — well, to many it can be a little gratifying.
Which is why so many of the stories of the province’s pending downfall seem to have sparked such ghoulish delight, and such chirpy coverage. But the numbers don’t quite bear out. Yes, the province has elected a bunch of socialists, but the bread lines aren’t exactly forming around the Bow.
A few points to keep in mind: yes, the province is heading into a downturn. But it’s a downturn from a peak — overall, Alberta is still doing relatively well. Economists are still torn as to whether the province is even in a recession. A recent report by ATB Financial, for example, suggested that the province’s GDP would grow by only 0.4 per cent. That might be the weakest growth rate in six years, but it’s not a retraction.
Alberta’s growing unemployment rate is still only 5.7 per cent, still about a point better than Ontario’s, and stronger than the Canadian average. The only province doing substantively better on the employment file is Saskatchewan.
Also, it is a province that is ruled by commodity prices — booms and busts are normal. More than any other province, Alberta knows how to ride out a storm — even one that is almost certain to get worse before it gets better.
Yes, the province that was once driving economic growth is in the midst of a downturn. That is going to have an impact on real estate prices, economic output and levels of employment. It’s also going to have an impact on the rest of the federation, as the oilpatch stops buying parts manufactured in the east, labourers head to their home provinces looking for work and the equalization money coming from Alberta starts to dry up.
Indeed, if there’s one thing this economic downturn is demonstrating, it’s that Canadians really are all in this together. So can the schadenfreude.