Kenney learns perils of governing the wild west
Six years ago, facing a collapse in oil prices, a squeezed economy, and a bad news budget ahead, Jim Prentice, the Alberta premier at the time, infamously warned Albertans on a CBC radio program to “look in the mirror.”
“Basically, all of us have had the best of everything and have not had to pay for what it costs,” Prentice said. It was an undeniable, yet unacceptable reality for Albertans. Two months later, Prentice resigned when his Progressive Conservative party was voted out of power for the first time in four decades, losing to the NDP. A year and a half after that, Prentice perished in a plane crash.
Fast-forward to this week, and Alberta Premier Jason Kenney’s battered United Conservative Party is set to release its 2021 budget on Thursday in the midst of a crippling economic downturn, a pandemic that has killed more than 1,800 Albertans, and a deficit that has tripled over the past year to $21 billion.
In a disastrous year for the entire country economically, Alberta led the decline. Real GDP shrank 8.3 per cent in 2020 in Alberta, compared to the country-wide average of 5.8 per cent, says a RBC report. Worse, the oil-producing province is set to post a below-average economic rebound, with economic growth this year forecast at 4.5 per cent, below the country-wide average of five per cent.
This won’t be an austerity budget, Kenney has said, but will aim for restraint. And despite the province’s harsh fiscal realities, a sales tax to generate revenue would be political suicide.
On Tuesday, Kenney said Alberta has seen a “significant recovery” in oil prices in recent months but acknowledged the province continues to face a “fiscal reckoning” as a result of a challenging 2020 with the COVID-19 pandemic causing health-care spending to rise at a time of collapsing oil prices.
No matter what unfolds on Thursday, the path forward for Kenney’s UCP government, slumping in the polls midway through its first term, is not going to be easy. Alberta has always been a hard place to govern, especially in hard times. Its electorate has long been sold on
Alberta exceptionalism.
“Prentice’s statement rings more true today than it ever has before,” said Matt Solberg, director at New West Public Affairs, who managed communications for the UCP on the campaign trail in 2019. “It was the beginning of the grim times … I don’t think people really quite understood the precipice the province was headed towards.”
Two years after riding to power on promises to cut spending, tighten budgets, boost the economy — and unite the fractious Alberta conservatives — things are not going great for Jason Kenney and his fledgling party. Just 26 per cent of Albertans said they’d cast their ballot for the UCP, according to January polling by Mainstreet Research.
Rachel Notley, the former Alberta premier and leader of the New Democrat opposition, said Kenney’s time in government has been marked by downloading costs onto Albertans.
“Quite frankly, I would argue that part of Jason Kenney’s problem is that he’s been treating Albertans as though he believes they need to ‘look in the mirror.’ He may have claimed that wasn’t what he was going to do, but that is in fact what he has done,” Notley said.
After Stephen Harper’s Progressive Conservatives lost the federal election in 2015, Kenney, then a senior minister in Ottawa, returned to Alberta, and in 2016, launched his bid to unite the right in the province.
When he led the UCP to a majority win over the NDP in the spring 2019 election, Kenney counted on Albertans’ endorsement of his fiscally conservative agenda to carry the province through tough times. He could hardly have expected to soon tackle a once-in-a-century pandemic, the worst recession in decades, and the collapse of energy prices.
“The consensus among media pundits was that it was a fool’s errand,” said the premier in an interview. “I think the vision has proven to be correct, but obviously we’ve been side-swiped by three huge black swan events no one saw coming.”
On Tuesday, Kenny said Alberta has seen a “significant recovery” in oil prices in recent months but acknowledged the province continues to face a “fiscal reckoning” as the province has faced a challenging year with the COVID-19 pandemic causing health-care spending to rise at a time when oil prices collapsed in 2020.
By no means did he expect his political life in Alberta to be easy. “You’ve got a pretty hard-core left-of-centre cohort in this province … and you’ve also got a province with kind of the most, the largest and loudest right wing, with a strong libertarian vibe in the political culture,” Kenney said. “Coping with those polarities at a time of great crisis is not for the faint of heart.”
Mid-way through their first term, the question now is how the party ought to proceed. Even within the UCP, members are split on direction. Stay true to the ideology? Embrace urban centrists? Double-down on the rural right?
The UCP made 375 policy promises in their 2019 platform. Albertans were nevertheless surprised when the things they voted for then materialized. A fight with doctors, for example, as part of the plethora of platform promises to rein in spending, didn’t go over well in a pandemic.
“Leaning into that mandate on all of those things may have worked in another sort of electoral cycle, where people’s lives weren’t upended, but they were, and so it becomes a lot more difficult to just do those things based on a vote in April 2019 if you’re not going to convince them why it’s still relevant today,” said Solberg.
The costs of the pandemic alone “torpedoed” the UCP’S agenda of budgetary restraint and a return to balance by the end of this term, said one former senior government source.
“I’ve said from the beginning of this tough past year that it’s a twin challenge of protecting lives and livelihoods … that’s not a slogan, it’s more true in Alberta than elsewhere,” said Kenney.
When it comes to pandemic policy, it has been a struggle to please everyone. “He’s still being kind of attacked from both the left and the right on it,” said a former senior UCP member about his pandemic policies.
There’s an admission within the party that, while they did well in the first wave, they made some mistakes. “There was a huge reticence on behalf of the government and caucus to reimpose draconian restrictions on citizens,” another former government source said. “To be quite honest, we should have imposed further restrictions in the fall.”
Even if the pandemic wasn’t a factor, mid-way through a first term is usually a rough time. Politicians try to front-load difficult policy decisions early on, with hopes they pan out or are forgotten by election time.
You’d expect a political party to be unpopular at this point.
“If they weren’t, then I think a lot of people would’ve said ‘you’re not taking advantage of this mandate,’” said Solberg. There’s still plenty of heavy lifting left to do, but the government is also “declining in political capital right now,” he said. “All of these things coming together have led to a pretty tough spot for the government.”
Alberta’s economic slump was inherited, to some extent, by the UCP. Despite efforts to attract new investment with corporate tax cuts, and injecting cash into projects like the Keystone XL pipeline, or diversification industries, Alberta’s fortunes continue to rise and fall with the price of energy — as they have for generations.
A recent pop in oil and gas prices could mean an unexpected boon in 2021 — for however long it lasts. “Energy prices have recovered, who knew?” said Kenney. “Eleven months ago I was staring into the abyss. Honestly, many of us thought it might be the end.”
Buffeted as they are by global forces outside their control, it is the unforced errors within the party that are causing major damage. Even discounting senior politicians travelling abroad over the Christmas holidays, the UCP has made some bizarre missteps.
In the most recent example, the province announced a plan to scrap a 40-year-old policy governing coal exploration along the eastern slopes of the Rocky Mountains. The decision purported to solve a problem of finding work for small-town Albertans. The blowback from small-town mayors, residents and ranchers, not to mention country music stars that caught wind of the plan, was badly miscalculated.
Following a messy drama of dissent over COVID policy within the UCP caucus, Kenney held a meeting on Family Day with his MLAS with the very clear message to toe the party line because it was causing the government problems.
Multiple sources the National Post spoke with traced the drama that has plagued the UCP back to the fact that Alberta’s conservatives have been in chaos for at least a decade. Kenney cobbled together the UCP from the remnants of the Progressive Conservative Party and the Wild Rose party, but the lack of internal discipline is still plainly — and painfully — obvious.
There’s an absence of loyalty and teamwork to the UCP brand itself, said the senior government source. “You’re just blindsided every five seconds by people who are selfishly going out to advocate for what they see as best for them rather than what’s best for the team.”
With 2020 in the rearview mirror, the leader is optimistic. “This province is irrepressible,” said Kenney. “That work ethic, that entrepreneurial culture makes this province unique.”
And there’s the reality of politics. As bad as things look today, the world can — and will — change. Two years till the next election is a lifetime from now.