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COLUMN: Buckle up for a rough economic ride

"Nothing balances any more. We’re now held captive on this dreadful teeter-totter, repeatedly lurching between health and wealth yet somehow managing to avoid them both."
Nelson Chris web

It feels as though we’re strapped aboard the teeter-totter from hell.

On one uneasy end sits the economy whilst on the other is perched our health: when one goes up, the other comes down.

Of course, what’s chiefly to blame for this dizzying conundrum is the current global pandemic, though here in Alberta we’ve had a not-so-generous helping hand in compounding our distress thanks to the sad state of the energy business, which has been under siege for at least the last five years. 

Anyhow, despite all the various measures so far introduced to curb the spread of this COVID virus, the one that has invariably proven the most effective – as it has throughout human history – is the use of quarantine, although once we only did that with the actual sick while today everyone’s fair game. 

Heavy-handed as such a measure may be, there’s no doubt that keeping everyone as separated as possible curbs the spread. (Or flattens the curve, if you prefer that particular slice of official jargon.)

But doing so involves closing so many small businesses that the economy inevitably takes it squarely on the chin.

And that’s where this teeter-totter sits today, as the province has yet again imposed strict public heath measures after an alarming spike in pandemic cases, hospitalizations and deaths across Alberta.

Those fortunate enough to have a government-backed job that helps insulate them from the full force of the subsequent economic fallout are therefore much keener on lockdowns than those who are left wondering if their employer can survive another extended closure, which is why such chatter about us all being in this together is pure hokum.

The Kenney government’s role as a fulcrum for these two opposing forces was tough enough to begin with but the recent outcry over some members nipping off for a breather in warmer climes has upset even that tenuous balancing act by ramping up the pressure to avoid any further debacles. 

Therefore it’s likely the premier will trod more cautiously before allowing any reopening of the economy – appearing to act in haste and be subsequently blamed for the outcome could easily cost him his job and dig a hole so deep his United Conservative Party will still be buried by the time the next election rolls around. 

So then, how bad is Alberta’s economy? Simply put, it is woeful.

The final economic statistics for 2020 have just been released and virtually every one is a horror show: we’ve lost 170,000 jobs, with zero growth in GDP and a ten-per-cent drop in exports. Inflation is the highest in Canada while our economy has contracted the most. Meanwhile our two major cities fight it out to have the worst jobless numbers in the country. (Only Peterborough, Ont., is worse.)

And it isn’t getting any better. After a slight rebound when things opened up again in mid-summer, we’re again on the downhill slide – in December, we lost another 11,900 jobs and things will undoubtedly be worse in January following a full month of lockdown. 

Meanwhile the bleeding continues apace in the provincial accounts. The expected deficit this financial year is expected to come in at $21-billion – three times what was projected back in February’s budget. Oh, and we are well on our way to owing $100-billion overall, as silly debt-to-GDP ratios have now replaced previous talk of balancing the budget.

Nothing balances any more. We’re now held captive on this dreadful teeter-totter, repeatedly lurching between health and wealth yet somehow managing to avoid them both.

And you thought 2020 was tough. Buckle up: we’ve seen nothing yet.