Why This October Matters in Alberta
In 1993, Ralph Klein rewrote the rules on political blame and Alberta’s municipalities haven’t stood a chance since. Back then, the price of oil had fallen through the floor and the province was more than $8 billion in debt. In response, Klein’s government sold public registries and liquor stores, privatized some parks, axed public staff, cut welfare rolls by 50 per cent and, eventually, demolished a Calgary hospital. Most of this punched down onto municipalities.1 They saw their provincial grants shrink by half over just three years.2 Transit systems had to stop growing; schools, roads, and bridges had to be left for the next generation to fix; streets in cities and towns, suddenly, were full of people experiencing homelessness.
But throughout this austerity, Albertans continued to pay healthy income taxes and flock to cities at rates that led in Canada, with eight in 10 in the province living in an urbanized area.3 What Klein changed was blame. He altered the amount that flowed back to the municipalities where people earned the incomes and paid taxes, but did not wear the anger that resulted from these cuts. Indeed, Klein was lauded as a hero. He alone held aloft the ‘Paid in Full’ sign in 2004 when Alberta’s debt hit $0. It was Alberta’s mayors, councillors, reeves, and alderwomen who had to amalgamate their municipalities, or cut basic services, or raise property taxes, or leave people behind, who felt the blame for years afterward. Klein realized almost all of the political upside of austerity. Municipalities and their residents bore nearly all the downside.
Municipal politicians have recognized this as a rule ever since. In 2015, for example, as the provincial New Democratic Party government looked set to discontinue the Municipal Sustainability Initiative, then mayor of St. Albert, Nolan Crouse, explained his plight. “They are going to cut and there’s not a soul that’s going to listen to a whining mayor,” he told the Edmonton Journal.4 “We’re beholden. If you squawk, you’re biting the hand that feeds you.” More recently, Calgary Ward 6 councillor Jeff Davison pointed the rule out when the province, which sets roughly a third of what municipal residents pay in property taxes through education levies, increased those amounts. “The unfortunate part is that we are the tax collector and we want to make it clear. While you live in the city of Calgary, you also live in the province of Alberta, and we’re just the facilitator who goes out to collect on behalf of everybody.”
The UCP, loathe to miss an opportunity to redirect any public anger away from itself, despite it being the government that raised taxes, has routinely gone on the attack. It has framed Calgary’s council as tax-and-spenders and Mayor Naheed Nenshi as “Trudeau’s mayor.” And yet when Calgary had the audacity to consider reducing spending on policing, a bread-and-butter conservative bedrock issue, Justice Minister Kaycee Madu lumped activists calling for police to be defunded and the city council into one group. “These are a bunch of socialists who would prefer to have a chaotic world,” he said.
Which brings us to this October and the election of councils, mayors, and other municipal representatives in Alberta. The coronavirus pandemic and the simultaneous collapse of the oil and gas industry make Klein’s era look cheery. Alberta faces fiscal reckoning. In 2019, long before the depths we’re in now, Kenney started his austerity rollout but said that if the picture didn’t improve, the Klein-era slashing would surely return. Municipalities — towns, cities, villages — are the arm of government that delivers most of our services and maintains the most stuff; yet, they have the least power to collect money. Many of the municipalities are already on the brink financially. There’s no more fat to cut. They will wear the pain of austerity.
So, this October was already going to be a vital election to decide where Alberta goes next. But the UCP has raised the stakes. The government seems to want to influence these elections. It has opened up campaign funding and political action campaign rules to invite much bigger, darker money into the municipal races in 2021 through new legislation that weakens restrictions on individuals donating to campaigns as well as rules that don’t require PACs to disclose their backers if they spend less than $350,000. And Kenney has also made it clear he intends to also use the municipal vote as a tool to simultaneously ask Albertans how they feel about federal equalization, possibly whether we should start a provincial police force. As I’ve written about elsewhere, many see this as a concerted push to bring out the angriest voters and ‘take back’ city councils. All of it suggests there’s not only a lot at stake for municipalities — from Calgary to Calmar, and from Empress to Edmonton — but also for the UCP.
Which is to say, again, this October matters for Alberta.
The stakes are obviously high for where the majority of us live in Alberta, which is in the two largest cities. Will Edmonton and Calgary be able to continue investing in the sort of quality-of-life improvements, such as the Green Line in Calgary, that Klein-type austerity kills off first, as their way to convince young people to stay once they graduate? Talent is becoming ever more mobile. A brain drain is already well underway, with those most able already choosing to leave. If the two largest metropolitan economies in Alberta fail to remain desirable, thanks to austerity and populist rage at so-called ‘urban elites’, the tailspin the province’s economy is in will rapidly accelerate.
In smaller areas, oil and gas companies have unpaid taxes to municipalities that have left some staring at the abyss. These taxes account for as much as 80 per cent of revenues in some areas. Collectively, rural municipalities take care of 85 per cent of Alberta’s roads. Pliant councils in these areas will allow the UCP to downplay what is clearly a crisis. Rebellious ones will not. There’s a lot at stake.
In more remote areas, revolts and refusals continue to pile up. In High River, the UCP’s wildly unpopular policy to change coal regulation has seen the town council call for a stop-work order on all coal mining until there is consultation. Expect plenty of PAC action there. Meanwhile, the town of Slave Lake recently took the extraordinary measure of publicly calling for its once-UCP MLA, Pat Rehn, to resign. “We seem to be making little to no progress in our Region in advocating for items that are a provincial responsibility,” the mayor and council wrote. “One of the factors that we believe is contributing heavily to this is the lack of engagement from you as our MLA.” Kenney soon after kicked Rehn out of the UCP caucus.
The spectre of big money has some concerned that new manipulation is lurking in the once small-money world of municipal politics. At the moment, one councillor in a mid-size city told me, there’s a high level of cooperation between municipalities because they’re united in their frustrations over a lack of consultation from the province on issues that affect their constituents. “If new councils are paid for by funders with an agenda, this advocacy on behalf of our residents won't happen,” this person told me.
But really, the largest issue that could affect every municipality, from the smallest to the giants, is the ongoing download of responsibilities and costs from the province onto their shoulders. If governments above abdicate responsibility on, say, homelessness, the arts, climate change, urban mobility, or you name it, what does that mean for municipalities? These governments are already struggling to grow into bodies that do more things for more people. But they also have zero new tools to raise money. Indeed, how will municipal governments evolve if their main conversation is about having to raise property taxes to cover something the province doesn’t feel like paying for (yet still collects and re-invests our income taxes)?
There’s a lot at stake in the coming municipal election campaign in Alberta. Rather than write about it locally, the idea with Rage Against the Municipal is to write about it provincially. What’s at stake? What forces are coming to the fight? Who benefits? Who loses? How do Calgary and Calmar, or Edmonton and Empress, fit into the larger story?
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*Photo from Flickr/Abdallahh
Read more about this here: https://albertaviews.ca/klein-revolution-part-ii/
Multiple sources, including Edmonton Journal, September 21, 1996, page 12.
Statistics Canada.
February 14, 2015. Not available online.