The Gift That Keeps On Giving

In the spirit of my recent rash of political commentary articles (rash and politics just seem to go together so well) I thought I would give a shout out to a recent idea proposed by a Liberal Party in Canada.  Ok, so it isn’t THE Liberal Party of Canada (federal), but the Alberta Provincial Liberals.  Not that I really know anything about provincial politics in the oil-rich province, but I would assume that the left wing of that political spectrum would probably still be called fascists in metropolitan Quebec.  Anyway, I read something in the paper that really got me thinking, and it had my inner educator and “plan for the future” side debating furiously with my libertarian leanings.

Best Bus Design Ever

For those of you that aren’t familiar with an election that has already included one of the greatest political photo-ops ever (see above) the only parties with a real chance to win are the Conservative party, and the Wildrose party.  Only in Alberta could one of the most right-wing political parties in Canada be outflanked on the right (definitely of note, both party leaders are female… only in Canada would the most right wing parties both be led by females and not old white men, but I digress).  Interestingly, with nothing to lose, the Liberals have proposed a very original idea that I believe at least deserves debate.  Much of this election has revolved around what to do with the embarrassment of riches Alberta will receive from oil royalties in the next 5+ years.  While various proposals have been heard, the two opposing arguments that really stuck out to me were these:

1) The Wildrose Party: Simply give the money back to the citizens of Alberta in the form of direct cheques (to the tune of $300 or so).

2) Create an income trust that will be used to fund post-secondary education in the province with the eventual goal of free tuition by 2025.

Now I’m not really a fan of free tuition.  I believe that post-secondary education should not be a right and that there should be a balance between what society subsidizes and what the individual pays because both sides do benefit from having an educated citizen.  That being said, a government-created income trust designed to benefit education is a uniquely original idea (to me anyway).  I would argue that the money could be better invested in terms of giving grants to innovation, or something like that, but the overall premise and juxtaposition with the Wildrose Party’s proposal gives us an interesting contrast.  I also find it ironic, that the “Crazy Cowboy” West is throwing around the idea of free tuition, while the “Pinko Commies” in Quebec are having to raise tuition 75% over the next few years and having violent protests on account of this.

The Gift That Keeps On Giving – An Angel On Both Shoulders?

So who wins this internal debate?  I’m leaning towards my plan for the future side.  I’m not saying we have to be all Scandinavian about this and keep taxes ultra-high while receiving energy royalties, but there is a certain amount of common sense (in my eyes at least) to using the windfall of today, to plan for the information and innovation-based economy of tomorrow.  Liberal leader Raj Sherman told the Canadian Press, “While our present is grounded in our natural resources beneath the ground, our greatest resource is our people, our young people.  If you have a five-year-old child today, your child won’t pay a cent in tuition.”  That sounds like a pretty good deal.  I mean it isn’t like Alberta currently pays exorbitant tuition fees by any means (their average undergraduate fees in 2011-12 were $5,662) and The Wildrose Party’s response of, “Wildrose believes that Albertans can spend their own money better than government,” hits me right in the financially independent heart, but still… The idea that Alberta could use the oil wealth of today to build a massive educational and innovative advantage is extremely alluring.

So, should Albertans take the lower taxes and direct cash back and stick it in an RESP account if they so choose, or should they opt for a basic government program that should (keyword: should) be able to be run with almost no government bureaucracy?  Maybe I should just stay neutral for once and say that I wish all provinces had such “tough” decisions to make… nah, not my style… Three hundred bucks is a night at the bar out in Cowtown, but an investment in education will almost assuredly pay massive dividends down the road.  The plan sounds simple enough to actually be implemented – now lets see if the political will exists.

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Interesting. Unless I am completely wrong (and I realize as an American it is easy to know little/nothing about Canada), isn’t the Canadian economy improving at a good pace?

11 years ago

How about a mix of both? Create a special tax-free vehicle for each citizen, with a limited number of private investment options (same as the Chilean pension plan), but with the stipulation that a very minor percentage of each account is earmarked for future tuition expenses. Oh, and a special clause that safeguards this legislation from fiddling and diddling by future money-grubbing politicians.

11 years ago
Reply to  Teacher Man

Ah yes, I agree… too confusing for the hoi polloi. Something that needs to be ramrodded by a lame-duck administration with nothing left to lose. Which makes it very unlikely.

11 years ago

I like 101 Centavos idea. Generally I wouldn’t want the money just given to us as a cheque… I mean I’d want the money to give back to the society at large. It’s large sums of money handled in a systemized way that allows us to fund education, get our streets paved, etc. So I’d like to see it helping out the society at large.

Reply to  Teacher Man

The economy in Texas is doing well (where I live). We have a big oil play developing south of San Antonio, and with new technologies even old oil fields are now pumping a lot more oil. I read of one near Midland (Permian Basin) that used to be a 50 barrel a day field (5,000 acre area I think), that is now pumping 10,000 barrels a day, and more is expected. All due to new technologies.

Texas also has technology, and green energy.

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