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Ricardo Acuña
Educators understand, perhaps better than most people, that the way to move a society forward lies in the ability of its citizens to engage critically and creatively with the world around them.
This is the essence of the critical-thinking skills teachers pass along to their students: the desire and ability to challenge hypotheses, interpret texts radically and develop new theories for how things work. An educator never wants to hear a student say, “That’s just the way it is. There is no alternative.” When that happens, society stops evolving.
The Parkland Institute believes that engagement is key to democracy and the public interest. In particular, we believe that there is value in researching and disseminating alternatives to current government policy. Just like educators, we understand that critical and creative engagement moves society forward. This is especially the case when those we have elected to protect and promote our interests stand before us and say that there are no alternatives, and that the only way to do things is their way.
We have heard this repeatedly over the last year from the premier, the finance minister, the health minister and the education minister. Their message has been clear and consistent. Alberta’s overdependence on natural gas revenues will result in a $4.3 billion deficit in 2010, and the only way to deal with this deficit is to cut jobs and public services. There is no alternative.
In fact, last fall, Education Minister Dave Hancock went as far as to say, “We can finger-point and blame, we can hark back to previous decades, but none of those things will put another nickel into the provincial coffers.” There is no alternative.
Over the past year, the Parkland Institute has been engaged in extensive research on all aspects of the economy. Our research has found that numerous alternatives exist; what’s missing is the political will to implement them. For example, the government is spending more than half a billion dollars this year alone on “drilling stimulus initiatives.” These are actually royalty breaks to the oil and gas industry—breaks that Parkland research has shown will do next to nothing to put Albertans back to work or to stimulate the economy.
In addition, the government has already committed itself to handing a further $1.7 billion over to the energy industry to subsidize carbon capture and storage projects—another industry giveaway that will do nothing for jobs, economic stimulus or the environment.
One area the premier has been adamant about not changing is the area where change is needed most—Alberta’s tax system. In 2001, Alberta moved from a progressive tax system (where the higher the income, the higher the percentage paid in taxes) to a flat tax of 10 per cent. This was the fruition of a tax reform plan put in place in 1999 by then premier Ralph Klein and then finance minister Stockwell Day, who were spurred on by the ultra-right-wing ideologues at the Fraser Institute and the Canadian Taxpayers Federation.
It was this ideologically motivated experiment that resulted in the loss of billions of tax dollars from the provincial coffers and ultimately made our public services overly dependent on natural gas revenues. In fact, according to recent research from the Parkland Institute, had the 1999 progressive tax system still been in place in 2006, it would have meant an extra $5.5 billion in the provincial coffers in that year alone, and significantly more in the current tax year.
Albertans are reluctant to talk about this because they believe the myth that they pay the lowest income taxes in the country. The reality, however, is that this applies only to the wealthiest Albertans. Albertans in the lowest tax bracket pay more income tax than their counterparts in six other provinces do. Likewise, a family earning $75,000 per year pays more in Alberta than it would in British Columbia, Saskatchewan, Ontario, Quebec, Yukon, the Northwest Territories or Nunavut. Even a two-income family with two children and an income of $125,000 in Alberta pays more in income tax than it would in Ontario or B.C.
There are alternatives.
Pursuing the alternatives listed above—$5.5 billion in tax reform, and $1.7 billion and $540 million diverted from carbon capture and storage funding and royalty breaks, respectively—would mean an extra $7.74 billion in provincial revenue this year alone. That would be enough to make up the $4.3 billion deficit and generate a $3.4 billion surplus, or provide $3.4 billion in increased funding to education, health care and social services.
Educators expect their students to be creative and critical and to seek alternative ways of doing things. Shouldn’t we demand the same of our government?
Ricardo Acuña is the executive director of the Parkland Institute, a nonpartisan public policy research institute at the University of Alberta that has been researching and publishing alternatives to public policy in Alberta since 1996. For more information about the institute or its work, contact the office at 780-492-8558 or visit www.ualberta.ca/parkland.
