Friday, April 24, 2015

News Flash: Public Opinion Polls Are Usually Correct

What's that old Dief saying? Polls are for dogs? I couldn't disagree more. One thing that people really need to get over is the myth that polls are meaningless in election campaigns. The fact is that polls, where the methodology is correct and the sample size is large enough, are almost always an accurate snapshot of opinion.

People will often point out the so-called surprise Progressive Conservative victory in the 2012 Alberta election. Poll after poll during the election put the Wildrose ahead and the PCs trailing. On election day the PCs won. But I hate to break it to the naysayers, but the polls during that campaign were correct. The Wildrose's support melted down in the last week of the campaign. Polling to reflect that wasn't released publicly, but the parties had it.

I remember running into a PC party strategist in an elevator in downtown Edmonton and asking him about the campaign the Friday before the election. He told me that they were going to win a majority. I thought he was just being a company man. Full of bravado. He insisted that he was not just spinning and that the party's internal polls had showed a stunning meltdown of Wildrose support over the last 5 days. That meltdown was due to voters being scared away by Danielle Smith's inaction on a few Wildrose candidates who had said or posted things that were abhorrent to Albertans. Had smith canned those candidates she would have been Premier. This strategist knew that because the polling told him so.

This time around the polling is telling us that Albertans agree with Jim Prentice and his claim that Albertans themselves are to blame for the province's fiscal mess. They agree because they voted PC over and over. Looking at the alternatives voters have scattered their support between the NDP and Wildrose. The polls since the beginning of the campaign have been notably uniform in their results. The Wildrose and NDP are within the margin of error for the lead, while the PCs trail by about 10 points.

The televised debate, in my view, didn't do much to cause a dramatic change in those numbers. But in the last week of a campaign, voters can change their minds. The Wildrose aren't making the same mistakes this time around, however, and the NDP's Rachel Notley was the clear winner of the debate. None of this bodes well for the PCs.

Maybe I need to get downtown and hang out in some elevators next week.

But that's just the way I see it.

Thursday, April 23, 2015

Will Alberta's Political Realignment Actually Happen?

The Field

Not so long ago it was hard to imagine that the Alberta Progressive Conservative dynasty could end. Indeed, for much of the last 44 years they looked like the only party that was capable of governing. And the reason I believe anything could still happen, in spite of many uniform polls suggesting the dynasty is over, is that they still look like the only professional party capable of governing. No offense to the very organized and professional looking NDP under the capable Rachel Notley, but their support has a ceiling due to the ideology that drives that party. Governing is not in the cards for them. You need to win in all of Edmonton, Calgary and rural Alberta to get a majority.

The Wildrose Alliance hasn't even fielded a full slate of candidates. Their leader, the intelligent and likeable Brian Jean, has only been leader for less than a month! The Liberals are, for all intents and purposes, not a serious party anymore. The Alberta Party, with it's "we're flexible about policy in the mushy middle" approach hasn't caught anybody's attention. They've only fielded 36 candidates. In fact, only the NDP has matched the PCs in fielding a full slate of 87 candidates.

So what happened to the PC party that has them trailing in the polls so badly? Currently they sit 3rd in every poll, hovering somewhere around 25%. The NDP is ahead at around 30% due to a commanding lead in Edmonton, while the Wildrose lead with around 35%. If those numbers hold on election day the PC party will walk away from this election completely destroyed and with only a handful of MLAs while Brian Jean becomes Premier with a minority.

What happened is that the saviour of the PC Party screwed it up. In fact, it's hard to imagine how Jim Prentice could have screwed up worse without a scandal. Let's review the PC Party screw ups, shall we?

Social Policy Screw-Ups

In the 2012 election voters were as fed up. They returned the PCs to power anyway because the Wildrose, who had led in the polls for so long, scared them away with the foolish choices of their leader, Danielle Smith. She chose to keep candidates who should have been disqualified. As a result they looked like they were anti-gay and racist. The last week of that campaign saw the Wildrose meltdown. That isn't happening this time because Brian Jean isn't making the same mistakes. Candidates who say homophobic things, even in the past, are getting dumped right away. No excuses. Right now they look more moderate than the PCs. And Prentice can't pull the "they're bigots" card on them because of his foolish decision to appease the Catholic school boards on Bill 10.

Communications Screw-ups

The collapse in the price of oil put a roughly $7B hole in the province's finances. In response to that Prentice warned of deep cuts in the range of 9% overall. He then followed it up by blaming Albertans for the situation they were in with his reckless "look in the mirror" comments. Albertans that I spoke to all agreed with Prentice, by the way. The most common thing I heard in response was, "Yes, we are to blame. We voted PC over and over". Ouch. Finally when the budget dropped the cuts were magically very modest.

Savings Screw-Ups

The PCs really have no answer to the charge that they didn't save much, if any of the resource revenues that they've been rolling in for years. When the late, great Peter Lougheed established the Heritage Fund in the 1970's he mandated that 20% of all resource revenues be diverted to it. Getty reduced that to 10%. Klein stopped contributions altogether. The fact that guys not named Prentice made such shortsighted moves doesn't seem to matter to Albertans right now. They're pissed off, and rightfully so.

Fiscal Policy Screw-Ups

The budget that the PCs dropped last month raised taxes. A "healthcare levy", which is really a surtax on your income tax hit the middle class. A new tax bracket hit wealthier Albertans. Taxes on gasoline, alcohol and cigarettes hit all consumers. Albertans were willing to accept all of that except that corporations and oil companies got away without a tax increase. Prentice says that increasing corporate taxes would cost jobs. Maybe it might, but he doesn't seem too afraid of chopping thousands of public service jobs, so jobs isn't an issue he can run on. Besides, even if Alberta raised the corporate tax to 11% from 10% it would still be the cheapest province in Canada, and second only to NWT as a jurisdiction. So saying that there isn't room for a corporate tax increase is quite a bit disingenuous.

With respect to oil royalties, Albertans just aren't buying the excuse that oil companies will pack up and go elsewhere. They won't. Why? Because royalty rates are higher elsewhere. We charge less than Texas does. There is no excuse for not having a fair rate.

Education Screw-Ups

Looking past the numbers in the budget, one can see a hard right shift from the Tories. The language surround things like health, education and post-secondary point to a much more market based approach. To be fair, none of the parties has a strong post-secondary platform. But since student groups don't lobby as a cohesive unit nobody gives a shit about them. Not even the NDP. But the overall package from the PCs just looked unappealing. Making universities, colleges and polytechnics become corporate beggars looks like an ideologically blind policy. Parents having to save far more to put their kids into post-secondary because "everything is on the table" with respect to tuition regulation looked mean spirited. Cuts to health and education made matters worse when contrasted to corporate welfare that costs revenue. The Wildrose policy of eliminating corporate welfare makes the PCs look like an old boys club.

Image Screw-Ups

There is an old saying that optics is half of politics. Prentice doesn't seem to get that. He taxed lower, middle and upper class Albertans. But all of them now think that they're footing the bill for Tory screw-ups while party donors and backroom dealers get away with nothing. A big problem for Prentice is that there's a lot of truth in that sentiment. Add to that the hard right shift with respect to post-secondary, K-12 and health, and you have a Premier who has painted himself into a corner. He can't attack the Wildrose on social policy because he's screwed up on Bill 10. He can't attack the NDP on taxes and jobs because he raised taxes and will cut public service jobs. he has no room to maneuver. Now he's having to backtrack on items in the budget like the stupid decision to chop the charitable tax credit.

Cinco De Mayo

So what will happen on May 5th? Will voters actually turn their backs on the PCs? Or will they get to the polls and say, "Nope, I just can't hand the keys to the Wildrose". With eleven days to go and a televised debate (tonight, 6:30pm) anything could happen. But you have to think that the odds that Alberatans will choose a political realignment are greater this time than ever before. People are pissed off. And the Wildrose aren't making mistakes. Heck, even the NDP are praising Peter Lougheed. Never thought I'd see that. There has to be something to this. No matter what, please be sure to vote. Even if you have to hold your nose.

I suppose Mr. Prentice, should he lose, can still apply for Stephen Harper's job next year.

But that's just the way I see it.

Monday, March 30, 2015

Prentice's Budget Doesn't Get Alberta Off The Roller Coaster

Now that everybody has had a few days to process, be pissed off, vent and lament last Thursday's Alberta budget, let's take a closer look at what actually happened, and what is likely to happen in the future.

Let's start out with the issue of tax increases. A year or so before his death, former Alberta Premier Peter Lougheed was a keynote speaker at a breakfast I attended. He shocked the room by saying that he felt that Alberta needed a tax increase. In the end, that increase happened. The problem with the tax increases was that they weren't equally shared and they were dishonestly designed. The new Health levy is just a surtax on your Alberta income tax. The money will go into general revenue and not be targeted to health care. So why not just increase the income tax to the same degree and call it what it is?

The actual increase in income taxes will only hit people with six-figure salaries. The health levy will only hit people making more than $50,000. For middle income people it will amount to about $16/month per wage earner. Not a huge tax, but a tax nonetheless.

One big issue I have with the budget is the language surrounding it and justifying it. First of all, as has been shown on this blog before, Alberta does not have the lowest taxes in Canada. At pre-budget rates, Alberta's lower and middle-classes are actually in the middle of the pack in terms of dollars paid. Alberta's wealthy have it better, but it's corporate Alberta that has it the cheapest. So stating that job layoffs in the public service and tax increases for middle income people and the wealthy are okay, but a tax increase on corporations might cost jobs when there is room to tax them more and still keep Alberta very competitive smacks of political graft. The party donors (corporations and oil companies) get away with nothing while everyone else pays. That's not good policy and it's not fair. Heck, they even cut the tax benefit for making charitable donations…but not the political ones. Despicable.

In terms of language, I was alarmed at the statement that Alberta's post-secondary institutions somehow have to get away from relying on government for funding. Since Alberta's post-secondary system is public, that statement makes no sense, nor does the lamentation that Alberta PSIs rely on public funding more than BC or Ontario. Do the Progressive Conservatives mean to make higher learning a business? Since that's not the point of a public system I can openly conclude that they no longer support the concept of public post-secondary. That should scare everyone in Alberta because it is going to mean more corporate control over learning and much higher tuition. Anyone saving for their kid's education should be worried.

The final thing that bothered me was the spin that this budget and its 10-year plan gets us off the roller coaster of resource revenues. If you look at their fiscal projections, however, Alberta only gets back in the black via a magical increase in the price of oil by 2018. Can we be assured that this will happen? Five years ago when the US discovered their natural gas reserves and tapped them the price collapsed and it has never recovered. Oil might make a comeback, but if we can't count on it then why budget for it?

Right now oil sits at $48/barrel. It's been hovering around there for the past couple of months. The market has been flooded with supply and there is no indication that the Saudis will cut back production anytime soon. And why would they? While flooding the market they can punish US shale producers, Canadian oil producers, and the Russians, who keep pissing them off via interference with Iran and Syria, all at once. Yet the budget assumes that a year from now oil will be back up to $62/barrel. It assumes that by 2017-18 oil will be up to $75 and $almost 85 two years later. If it doesn't the surplus situation they project will turn to a large scale deficit. So why not take the opportunity to fix it now, instead of telling people that a little bit of pain today will make tomorrow rosy?

So while what Alberta really needs is a serious plan to diversify its economy away from oil and gas the Progressive Conservatives have sheltered oil companies from royalty and tax increases, while sending messages that they no longer support the public post-secondary system that has to play a huge role in any economic diversification plan. That's not good government.

I have no doubt that the PCs will win a majority in the upcoming provincial election, even without my vote, which they usually can count on. There just isn't another professional government in waiting. The Liberals don't even have a leader. The NDP, led by the shrill Rachel Notley have no chance at government. The Wildrose have a new leader in Brian Jean, but the public is unlikely to forget that their former leader found so many in that party to be so intolerant and difficult to work with that she quit them, leading a mass exodus to the PCs. Even after losing her PC nomination she maintained she would do it all again. She may have been an opportunist, but if it was so bad that she couldn't take it anymore even though she came within a whisker of becoming Premier while leading them, it is not something to ignore.

So get ready for the other shoe to drop. After the election you will see how they manage to deal with those unrealistic projections and get down to business, assuming they bother.

But that's just the way I see it.

Wednesday, March 25, 2015

Alberta Does Not Have The Lowest Taxes In Canada!

I wonder how many people have bothered to run the numbers on taxes in Canada. I doubt that many have. A lot of people take it on faith that Alberta, at a 10% flat rate, has the lowest taxes in Canada. The fact is, though, that Alberta doesn't rank #1 in any income group. It ranks #1 if you are a corporation, but only #4 of you are a small business.

Here is how Alberta ranks in terms of having the lowest taxes on Canada:

Personal exemption: #1

Small business: #4

Corporations: Tied for #1 with BC and New Brunswick

Income levels
$30k: #5

$50k: #6

$75k: #6

$100k: #5

$200k: #2

Sales Tax: Tied for #1 with NWT, Nunavut and Yukon

When Jim Prentice brings back health care premiums in his budget on March 26, he will make Alberta nowhere near the lowest taxed jurisdiction in Canada. And of course, the middle class will hurt the most, as usual. Will royalty rates be touched? Nope. Corporate taxes? Nope.

But hey, its the people of Alberta who matter, right?

But that's just the way I see it.

Tuesday, February 24, 2015

Why Albertans Should Oppose Health Care Premiums

With the price of oil now hovering around $50 a barrel and the Province of Alberta dearly wishing it had given more credence to the advice to diversify its economy, Premier Jim Prentice has some tough choices to make.

Based on the government's budget of last year the price sensitivity with respect to revenue is $215 million per dollar. If true, then the difference between what that budget forecasted for oil ($95/barrel) is $9.675 billion. The government is estimating that the hole is smaller than that, around $7 billion. So how will they make up that shortfall? Judging by the trial balloons being floated one of the methods they are seriously contemplating is bringing back health care premiums. I'm going to tell you why you should oppose that and call your MLA (assuming you have a government one) and tell them so.

1. Health Care Premiums Always Went To General Revenue
Calling health care premiums "health care premiums" is dishonest unless the money is targeted towards health care. When we had those premiums before the money went into general revenue. There is no guarantee of increased funding for health care or better service. In spite of calls for "sustainable funding" from the Alberta Medical Associations, the numbers show that public health in Alberta has been a money pit for a long time with more and more money going into it without results. Perhaps there is a structural issue there?

2. Health Care Premiums Are A Huge Tax Increase
Remember what health care premiums used to cost? The average family paid over $1000 a year in premiums. That was in 2009. Care to have your taxes increase by $100 a month? That's a massive tax grab.

3. It's Bad Policy
If health premiums are going to go to general revenue then why not just increase the income tax? Why have the administrative burden of two different taxes by two different names? Bringing in a massive tax increase that is disingenuously labeled is a really, really bad idea.

4. Alberta Spends Too Much
Alberta only lags behind Quebec in per capita spending among Canada's larger provinces. Alberta spends more per capita on healthcare, doctors, nurses, public servants and K-12 education than any other Province. Is there any grander strategy here? Does n't look like it. Maybe focus on education at all levels rather than having the funding per student drop in half between K-12 and post-secondary? How about an audit of actual health providers like nurses? Are they too scared to ask them how hospitals should be run? I think they are. Too many leather chairs, not enough actual care.

5. Alberta's Resource Royalties Are Too Low
There's competitive and then there's ridiculous. Taxing Albertans but not corporations? Single Albertans and families taking the whole burden, but oil companies get away with comparatively low royalty rates? Really, if the pain is coming, it should be shared by all, not shouldered by just some of us.

If the health premiums keep getting floated, we all ought to fight them tooth and nail. Call your MLA!

But that's just the way I see it.

Wednesday, February 18, 2015

6 Things You Should Know About Your Facebook Posts

Most people I know are on Facebook. But not everyone I know is on my Facebook friends list. Some people I don't have on Facebook because I don't think it's smart for me to have them. Others I don't have because I only know them in a professional way, so I keep them on LinkedIn instead. Finally, there are some whom I am not friends with on Facebook because I unfriended them either because I didn't converse with them ever, or because they simply annoyed the shit out of me. This leads me to the 6 things you should know about your Facebook posts.

1. Not all of your friends will see your post.
You may not realize this, but some of your friends have your posts blocked from their news feed. You simply don't show up. It's their way of unfriending you without risking you noticing and getting offended. What? you thought that friend with 780 other friends is paying attention?

2. Nobody gives a shit about your workout.
Posting about how awesome your workout was will lead to people doing what they do in #1, above. In the end, nobody is impressed with how long your run was, how many reps you did with how many pounds or how sore you are now.

3. When you send game requests your friends hate you.
Sending out requests to play Candy Crush Sage, Farmville or any other game on Facebook is as good as saying "please unfriend me…please!" It is annoying. You are annoying.

4. When people say "Aw! That's so cute" they don't mean it.
Your friends really don't want to see pictures of your kid puking on the floor, torturing your cat, or slopping food all over a high chair. But in order to stay in your good graces they post that it's cute and then hide it from their news feed forever. It's true.

5. People roll their eyes when you post sentimental bullshit.
Posting pictures of clouds with some pseudo-intellectual semi-inspirational saying on it makes people throw up in their mouths just a little bit. Posting things like "A friend is…." makes people ditch you on Facebook.

6. You look stupid when you post superstitious nonsense.
"Re-post this 20 times and good luck with come to you" is so obviously ridiculous that your friends think, "Jeebus, he/she must be desperate/stupid to resort to doing that". Yes, they really think that about you.

You can call me negative if you want, but somebody had to say it.

But that's just the way I see it.

Tuesday, February 17, 2015

Let The Travel Gouging Begin!

If you're like me, you take a vacation every year. Traveling can be expensive at the best of times, but an annual vacation is a healthy thing to do. After all, the last thing I want to do when I'm in the end of days is to look back with regret and wish I had done this or that. My wife and I have taken to having a yearly Mexican slothiday. I am seeing some disturbing trends, however, that will likely force us to scale back some of our travel plans for the foreseeable future.

We usually book early for a winter getaway. Most often the vacation packages to sunny locales for the winter go on sale in late spring or early summer. I was surprised to see that not even two weeks after returning home this year the packages for next winter were already on sale. Since my wife and I enjoy getting pampered when we fly south, we try to make sure we get in and get the seats we want early. But I'm not interested in throwing down deposits on a trip a year in advance.

I have found that booking early has never been a mistake, price-wise. The price of my package has never gone down during the summer, fall or early winter. It's only the last few weeks that see the price drop significantly. I'm not interested in gambling like that, so I book in spring. What has me in shock isn't so much that they are selling so early, it's that the prices are more than 20% more than they were the previous year. The excuse given for that? The decline in the Canadian dollar. To this I say, "bullshit!". Here's why:

If you take a look at what goes into your vacation package you can piece out what parts are paid for in which currency. Your resort in Mexico pays its employees and suppliers in Mexican pesos. However the Canadian dollar hasn't dropped in relation to the Mexican peso. It's almost exactly where it was a year ago. 12 pesos to the dollar.

The flight crews, pilots, ground crews, and most fees are paid in Canadian dollars, which is obviously static in relation to itself.

The fuel for the aircraft is bought in American dollars. The American dollar is 20% more expensive to buy with Canadian dollars, which is the excuse for the price hikes. However, the price of oil is half of what it was last year. So a 20% increase in the cost of the American dollar, but a 50% drop in the price of oil.

Your sunny vacation package for next year should actually be somewhat cheaper than this winter's prices. Yet the prices are more expensive. Why? Simple. Airlines are pocketing the difference in fuel, but passing along the increase in the American dollar. They are doing it for flights and packages in every corner of the market. And that's called gouging, and it is supposed to be illegal. Do I think our Conservative government will do a damned thing about the airlines doing this? Well, you can wish in one hand….

But that's just the way I see it.