Alberta's Spending Problem Runs Deep

The recent surge in oil prices due to the Iran war and closure of the Strait of Hormuz may help alleviate Alberta's $9.4 billion budget deficit, but this will only temporarily mask the province's spending problem.

Alberta's budget woes have never been about revenue; instead, it's a matter of runaway spending that has increased by 75% per person (inflation-adjusted) since the historic Klein reforms in the early 1990s.

The Klein government implemented spending reform, requiring each ministry to justify its existence and find efficiencies, which helped balance the budget by 1994/95 and eventually pay off Alberta's debt.

However, governments have a habit of repeating past mistakes. Resource revenue climbed in the late-1990s to mid-2000s, and spending skyrocketed along with it, reaching historically high levels today.