Alberta furious; no money for rail tankcars, but Ottawa takes $20 billion to hand to other provinces

[Jan van Eck + 7,558]

Canada has this bizarre extra-tax system to enable the Federal Govt to hand out so-called "equalization payments."  The whole idea originally was to give gobs of money to Quebec to keep it from seceding, basically a series of bribes.  The tax program is now institutionalized, and the three "donor Provinces" are the oil producers:  Newfoundland with its offshore oil, Saskatchewan with its conventional oil, and Alberta with both conventional and oil-sands oil.  The Feds take roughly $20 Billion from those three and hand out the candy to the others - except Ontario, which despite a provincial deficit of some $15 billion  (a structural problem inherited from the Kathleen Wynne Liberal party spending programs), which now under the Ford leadership of the Conservatives will receive nothing.  

The lion's share of the Equalization Payments goes, as always, back to Quebec, the French-speaking outlier, for 2019 about $13 Billion.  Interestingly, Quebec is headed for a zero-debt position in perhaps 30 years, due to its huge sales of hydroelectric power to the Americans.  Nonetheless, it gets all the cash, leaving some crumbs for the seriously poor Provinces, including New Brunswick, Nova Scotia, and Manitoba. 

At the latest (current) Federal-Provincial Conference on all that, Alberta asked for help in buying a new fleet of tank railcars to move its crude, now that the various pipeline projects are hammered into oblivion.  The Feds said "no."  You can feel the fury in the shaking of the ground of the Western Prairies.   Here's my prediction:  next election, Alberta will outdo Ontario in the destruction of the Liberal Party: it will return Zero Liberals to Parliament.  Just watch.  

[Jan van Eck + 7,558]

8 hours ago, mthebold said:

1)  Could a province actually secede?  Are any likely to do so?
2)  We've seen one province turn conservative, and you're predicting a second.  In the long run, could enough turn conservative to sway national politics? 

The answer to both your questions is "yes".  But note that the Liberals in Quebec ALSO took a recent pasting, and the equivalent of the national Conservative Party is now installed in government there. They call themselves the  "Coalition Avenir Québec" (CAQ), which I very roughly translate as "The coalition for the pathway of Quebec"  That Party totally demolished the Liberals, now with 74 out of 125 seats in the Parliament in Quebec City  (the Liberals dropped to 31, I think).   Quebec has always had these weird parties, the CAQ is the political offspring of the old Union Nationale, a socially conservative party that basically stood for an independent, French-speaking and totally Catholic province.  For example,under the Union Nationale, divorce was only possible for adultery. And the complainant only had to claim one single instance.  And women could not own real estate.  It was very conservative. 

Canadian politics are governed by the voters in the cities.  The rural voters are, and feel, disenfranchised.  There is this big intellectual and social disconnect, with the urbanites poking fun at their rural cousins, you see that in comedy TV shows up there where you have these two dull-witted fellows in red-checkered flannels carrying lumberjack axes and saying "Eh?" to each other.  The irony is that there is more truth to that image than anyone in Canada dares to admit. The American equivalent would be the rural people of Tennessee, where you get beat up if you publicly say:  "NASCAR sucks!"  Those rural people don't much care for the city folks, and are seething at their being abused and scorned.  So yes, all it takes is some good spark and you will have political fireworks.  Canada is not the nice, polite,urban-effete society they like to think of themselves as. That self-image is the narcissism of the university-educated elitists, who know better than everybody else.  Until the election. 

[Karl V + 33]

Canada's Equalization Payments System is not that bizarre ; Germany has such , as long as I can think of , with the Southern States usually being the givers , and the Northern States being the takers .

Money itself became that much of an income , that the State of Hesse with the Banking Place city of Frankfurt being the largest giver IIRC .

Somehow it does not hurt the giving states much , since that South-North scheme is functioning since two to four decades at least . Of course , complaints are expressed all the time .