- In the beginning, Alberta had no money. Then we discovered oil. And for a time it was good.
- Now Alberta has lots of money. So do the oil companies. We regularly post billion-dollar surpluses, they regularly post billion-dollar profits.
- Recently, there has been a feeling that oil companies are getting too much money for what, by rights, is a public resource. So, a panel was commissioned to review the issue, and found Alberta could up its' resource take by 2 billion. The industry protested. After reviewing the panels' recommendations, the government raised its' take by 1.4 billion. The industry continues to protest. Now times are less than good.
My take on the whole issue is that I can support raising energy royalties in principle IF that money is then reinvested in growing Alberta's economy in other sectors. As it currently stands, Alberta has one industry driving the economy: oil. I don't see anything wrong with expanding the number of industries propelling us forward out a bit.
But I don't support increasing royalties. Why? Because it's not going to be used for growing our economy. It'll go where most of the budget goes: to various peoples' pet causes. Someone will say "it's a crime that in a province as rich as Alberta we can't afford [more health care, better roads, more schools, whatever]" and the government will then fund it.
There's nothing wrong with any of those things I mentioned as pet causes, and these are things the government must address... but the economy comes first. And if the economy suffers, by taking money out of revenue-producing industries and placing it into things that do not produce revenue, then ultimately revenue will drop and we still won't have any funding. If jobs are lost, projects shut down, junior companies can't viably explore, the whole thing falls apart.
I really get the sense that people are thinking about this issue with their hearts not their heads. They look at executive compensation and say "that's not fair! I want some of that!" And so when they get the chance, they tell the government they want to put the thumbscrews to the oil industry. That's an emotional reaction, not a logical one.
Because logic would point out the thumb in the screws is the same one attached to the hand that feeds.