As your MLA, I have to confess that the thinking process that brought me to a better understanding of the difference between economic activity and economic development took me a wee bit of time to work through and fully understand.
Whenever someone is spending money, it’s easy to see the ensuing activity and assume that something good is happening. Yet, as I’ve watched the provincial government pour millions into various spending schemes (insisting that it’s doing so for reasons of economic development), I have to acknowledge that despite the initial burst of activity, the so-called economic development doesn’t take root or become firmly established in a way that’s profitably self-sustaining.
If I take my credit card, borrow money, and spend it, economic activity is occurring. But the idea that living on a VISA card is the same thing as economic development is silly. This leads to the obvious question: if something is silly for a normal person to do with his or her own money, by what stretch of imagination does it become an excellent idea for a government to do exactly the same thing with other peoples’ money?
Albertans need economic development. We do not need more government spending. The two should not be confused. Government spending is something that governing politicians are now doing through debt using our taxpayer credit card. The economic development Alberta actually needs is something ordinary people do with their own money, ingenuity, labour, and innovative ideas. It occurs when the investment climate and government regulations permit people to keep their own money (low taxes) and remain unhindered by bureaucracy and unnecessary regulation.
When the government does not take away people’s money through excessive taxation, ordinary people have cash in their pockets. They look for ways to add value to things and make what they already have more able to generate additional wealth. They’re free to invest and improve their lives, while expanding their property holdings and assets. (Keep in mind that property refers to much more than land and real estate.)
The wealth of Alberta was not created by government bureaus. It was created by individuals, families, and businesses who seized the opportunities before them and turned them into something new and valuable. They improved things, adding wealth and productivity to their farms, ranches, retail businesses, services, and much more.
Small government, low taxes, securing property rights/contracts, and the elimination of unnecessary regulations are the formula for wealth creation. These are the ladders of opportunity that ordinary Albertans require to create new wealth and facilitate true economic development.
The best thing any government can do is to create an environment that lets people do this. Unfortunately, rather than shrinking the size of government and lowering taxes, the current administration has been doing just the opposite. In practical terms they should quickly move to stop borrowing, and refrain from spending our tax dollars on things we would never buy ourselves. A new, streamlined, fiscally focused administration could empower all Albertans while appealing to local and other investors.