The former federal government that ran six consecutive deficits and racked up an additional $100-plus billion to our national debt seems to be kicking up its hypocritical rhetoric a few notches.
Since announcing Canada's budgeted deficit for 2016 would nearly double to about $18 billion from roughly $10 billion, the Trudeau Liberals have been subject to all kinds of attacks from the Conservative party, which seems to have a highly selective memory.
It's almost as though the official Opposition thinks it could do better with the price of oil stagnating at about $35 a barrel, with no end in sight as countries like Saudi Arabia recently announced they'd be willing to endure a low price of oil to drive out high-cost producers, which includes the oilsands.
Apparently, the financial crash of 2008 was all the justification in the world the Conservatives needed to run deficits ó even when the party had a majority ó and significantly rack up national debt. It was perfectly acceptable for the Harper government to spend through tough times to stimulate the economy. But heaven forbid any other party should also engage in stimulus spending to help generate some desperately needed economic activity.
Let's not kid ourselves by pretending the national or global economies have fully recovered since the financial crash. Perhaps the recovery was well on its way ó at least for the one per cent, who saw the vast majority of economic gains made since the crisis. But then the price of oil started crashing in 2015.
Granted, the former government had to deal with the 2008 crash. However, it also got to ride high prices of oil that peaked at more than $140 per barrel before the financial crisis only to rise back up to more than $120 per barrel by about 2011. And now, the Liberals are expected to conjure up magic with the price of oil being at what comparatively speaking is nearly rock bottom.
The same goes for Alberta's new NDP government. The former PCs got to ride a tidal wave of surging oil prices, leaving little to nothing to show for it, and the NDP are expected to somehow pull a rabbit out of a hat.
While taxpayers have every reason to demand their dollars are well spent, there's no question that austerity measures during challenging economic times merely exacerbate matters. When tens of thousands of Canadians ó many here in Alberta ó have lost their jobs, further adding to unemployment is not the wisest course of action.
Expecting a government to cut spending while balancing its budget when its revenues have been negatively affected so drastically by multi-billion dollar shortfalls is unfathomable.
Chances are the situation is not about to change and that the next oil boom is far beyond the horizon. The low price of oil is the new norm, at least for the foreseeable future.
Investing in infrastructure and maintaining services during an economic downturn might mean borrowing money, as well as the cost of repaying interest on that debt, but it will also put Alberta and Canada in a much better position to grow when the economy eventually turns around.
