Doing the right thing and what’s politically expedient is the age-old tug of war democracies have endured throughout the ages. The governing party constantly walks a tightrope, trying to please the electorate in hopes of retaining power.
When there is a crisis, the urge to influence the vote gets magnified. We don’t need to look too far to see this truism in play today. Driven by inflationary pressures, U.S. President Joe Biden, whose major campaign flank was addressing climate change, is bent on fighting high gasoline prices. To do so, he is urging Congress to lower everyday costs for Americans by extending Obamacare subsidies and provide a tax credit for families.
At home, the Trudeau government has surpassed historic federal spending levels in an unprecedented manner, dealing with the pandemic and now major inflation.
Municipalities cry poverty and demand more money from the province.
The province is trying to do its part to ease inflationary pressures on Albertans, first by dropping the provincial sales tax on fuel, and most recently with Bill 18, the Utility Commodity Rebate Act. If passed, it will give Albertans a total of $150 spread over three months as an electricity rebate, and a natural-gas rebate that would kick in from October 2022 to March 2023 if gas rates hit above $6.50 per gigajoule next winter. The timeline for the retroactive electricity cash is still undetermined, though the province continues to insist the money will come some time this summer.
Readers will remember the Prosperity Bonus — nicknamed "Ralph Bucks" — introduced in September of 2005 by then premier Ralph Klein. The one-time $400 rebate was paid out to nearly three million Albertans in 2006 as a dividend from the provincial budget's oil-fueled surplus.
The province, at the time, frittered away $1.4 billion — a small price to pay for political popularity, no doubt. Today, the province’s “Cost-of-Living Rebate,” while welcome by many, is a short-term Band-Aid on much larger fiscal challenges.
Governments at all levels want to be viewed by the electorate as doing something to better their lives. These expectations have grown over time. It is the nature of taxpayers to take the money now, and face the consequences of higher deficits and debt later. That penchant is, ironically, what fuels democracies and pushes them in debt.
While the allure of money being spent on subsidies, grants, and programs to deal with the challenges of the day is undeniable, there is only one taxpayer. You can move things around on a financial statement, within the rules, but you can't make a tangible thing disappear. Somewhere along the way, we'll have to pay it back, and that's not a problem the government can easily solve — now, or later.
With so many Albertans trying to make ends meet as inflation spikes, it's easy to see why we want money, now.
MNP's Consumer Debt Index, released last week, showed 52 per cent of households in the province are within $200 of falling short of paying all their bills by the end of the month. We may like the thought of a $150 rebate, spread over three months, but will it have a lasting impact?
Running a government in a democracy is a tricky gambit. The need to get elected is the first order of business. The long-term view is sometimes an abstract notion. For once, it would be great to see government avoid the quick fix. The electorate, however, has been conditioned for just that.
Editorials are the consensus view of the St. Albert Gazette’s editorial board.
