By Medicine Hat News Opinon on August 23, 2019.
Herbert Hoover in an address to the Nebraska Republican Conference in Lincoln, Neb. on Jan. 16, 1936 stated, “Blessed are the young, for they shall inherit the national debt.”
If only Hoover had known the future. The statement is not country specific, it is a concept that applies to all free market democratic countries. Here we are 83 years later and government debt, both federal and provincial, are at numbers that could not possibly have been imagined then. Even if we adjust numbers for inflation and buying power, the attributable debt to each Alberta family is far too high.
“If you don’t have a competitive advantage, don’t compete,” Jack Welch, former CEO of GE, once said.
For years, Alberta has been known for the Alberta Advantage, and while it was often referred to in relationship to our excellent oil and gas and agricultural producers, our tax advantages, it also encompassed Alberta’s fiscal strength and as a result excellent health care, education and social safety nets. We had a competitive advantage and we were able to compete. Our debt servicing costs were very low by all standards. Not anymore. Now $2 billion a year on interest payments is what we are currently paying for provincial debt servicing. That is not an inconsequential number. That is money that could be spent in so many other important areas. That tax advantage allowed industry to develop and flourish. Which in turn provided revenue to the province to grow and support services.
In a piece for the Fraser Institute titled The Illusion of Alberta’s Jobs Recovery in August 2018, Charles Lammam and Hugh MacIntyre wrote, “Governments can also borrow to fund government employment but since government debt must ultimately be repaid by future taxpayers, this debt is simply deferred taxation.”
In an October 1983 speech to the Conservative Party Conference, Margaret Thatcher said, “The state has no source of money, other than the money people earn themselves. If the state wishes to spend more it can only do so by borrowing your savings, or by taxing you more. And it’s no good thinking that someone else will pay. That someone else is you.”
Both quotes reflect the fact that only true revenue growth is the answer. through enhanced productivity and development of all industries. Free enterprise. Creating a fiscal and regulatory environment that fosters growth of private industry. We are blessed with a resource rich province, from our people to our land. Let the resource rich environment flourish. Development of industry is the backbone that allows economies to prosper. We must give people the opportunity to create new business to earn a profit to meet the needs of Canada and the world. A thriving industry provides jobs, purchases other goods, creates other businesses to support them and pay taxes. Taxes are revenue to support government provided services. When industry is overregulated, overtaxed, and overburdened by government entities, it does not flourish. Enhanced productivity, competitiveness and innovation foster growth and opportunities for families and communities. This in turn creates wealth and taxes, which lead to higher standards of living.
Albertans and Canadians let’s compete, create new industries, new companies, new opportunities, and create the environment for the most choice and freedom anywhere.
Drew Barnes is MLA (UCP) for Cypress-Medicine Hat constituency.
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