Alberta faces an uncertain economic future

But by the end of October, much of the uncertainty should be resolved

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RED DEER, AB Oct 9, 2015/ Troy Media/ – In Alberta, October is shaping up to be among the cruelest of months – and a month of great uncertainty.

The cruelty is mostly economic.

Combines are grinding through paltry crops and the worldwide slump in oil prices has slowed general economic activity (and, just so we remember that the economy has leverage on social conditions, the oil downturn has also been blamed for a rise in Edmonton crime).

House prices have flattened and sales have stalled.

Jobs are disappearing and economic growth forecasts have been muted – or are in reverse.

With no control over oil prices or oil company spending, and no ability to predict or tame the vagaries of the weather that impact crops, Albertans can only wonder about the uncertainty of our economic future, both in the near term and over the next four or five years.

As October dawned, ATB Financial chief economist Todd Hirsch said, “It is probably going to be another eight to 12 months of pretty tough sledding for Albertans.” His forecast include the dreaded R word: recession.

Cruel indeed.

The uncertainty?

We should be looking to leadership for direction and innovation, but given the current circumstances, we can only hope and wait. Who will form the next federal government, and what will their five-year mandate hold? What will the first New Democratic Party provincial budget hold for Albertans, or for that matter the next four years?

We are on federal election watch and we are on provincial budget watch – and rarely in the last three decades have these events mattered more in Alberta.

The federal election debate has offered threads of economic policy, but no whole fabric from any of the three leading parties. The closest thing to concrete economic management for the future comes from the Trans-Pacific Partnership tentative trade deal brokered by the current Conservative government. However, it is a deal that provides wide-ranging access to markets but no guarantee that our particular products will be desired or consumed.

And we still have not had concrete conversations about economic diversification and value-added products in Alberta – the kind of conversations, followed by an economic evolution, that would ultimately make the TPP lucrative to us.

Who will spark those conversations, and when, is anybody’s guess. To this point, it has not been Conservative governments at either the provincial or federal levels.

At the provincial level, Albertans looked in the spring at all the options, after years of frustration, and elected Premier Rachel Notley’s NDPs. We will know shortly how that fledgling government will manage the economy: its first budget will be delivered on Oct. 27, and Finance Minister Joe Ceci will only say that it will include enhanced spending on infrastructure, and that core services will be protected.

At the federal level, the choice of Albertans at the ballot box on Oct. 19 (and, according to the latest polls, our choice is Conservative still) will not nearly dictate the election’s outcome on a national scale. Will we be part of a tide or against the tide?

How the month will unfold is anyone’s guess.

But by the end of October, much of the uncertainty will be resolved.

How long the cruel economic conditions remain after October depends in great part on the initiatives of two governments with fresh mandates.

John Stewart is former managing editor of the Red Deer Advocate.

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