Member Since: 8/13/2012
Posts: 32,832
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Alberta's economy to collapse, Canada's at risk
Quote:
"We have been living beyond our means in this province" says Alberta Premier, Jim Prentice. The dramatic, precipitous drop in the price of oil makes that painfully clear.
Calgary home sales down 25% from November to December
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Having the lowest tax burden in Canada with high public sector salaries is not a sustainable model. It never was.
For years now, Alberta has been the land of plenty. The promised land. Most Canadians on the move — moved here. Why not?
Between 1995 and 2014 the average annual employment growth rate in Alberta dwarfed all the other provinces. Alberta's average employment growth over a 10-year period was 2.50 per cent a year; Ontario was a distant second at 1.44.
What now? As economists and politicians peer over the precipice, looking for the bottom for oil, Ontario's premier is predicting a turnaround for her province.
Kathleen Wynne says "we have a diverse economy and it can be a buffer in a time like this, against some of that volatility." Perhaps, but will it be enough?
While manufacturing benefits from a low dollar, Central Canada will also have challenges with the plummeting price of oil.
As Todd Hirsch, the chief economist at Alberta's ATB Financial, points out, "many manufacturers in Ontario and Quebec have actually been tied into Western Canada's oil and gas sector.
"While the auto sector used to be the largest area of growth for manufacturing, over the past 10 years, it has been specialized equipment, boilers, pumps and other inputs used in the extraction of petroleum" that has kept Ontario's manufacturing sector alive.
Hirsch says Wynne is correct in saying Ontario can be a "buffer", but it won't "be enough to propel overall Canadian growth higher in 2015."
This isn't 2008-2009. Prentice calls it the "most significant challenge in a generation."
This is not a "normal commodity cycle," he says, and will create huge revenue shortfalls for years.
The national spillover, too, could be enormous.
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http://www.cbc.ca/news/canada/calgar...g-in-1.2900940
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the blackhawks are gonna be so screwed