Tax – Why You Shouldn’t Take This Election Seriously
At least on first glance, you’d think things couldn’t get much worse in Canada in general, and Alberta in particular. Commodity prices are all down—some near historic lows in real terms—and Canada is all about commodities.
Then, last year, Canadians elected Justin Trudeau as Prime Minister, who can be counted on to promote absolutely every politically correct Big Government notion that crosses his mind and make the wrong decision at every opportunity. “Bold new programs” are always fun at the beginning. And since the Canadian government is in better shape than that of the U.S., it will be fun squandering whatever is in the piggy bank.
Not to be outdone, the Albertans elected the NDP for their provincial government; Canada’s NDP is best compared to the Bernie Sanders wing of the U.S. Democrats. They’re doing their best to bedevil oil, agriculture, and business in general, even trying to unionize family farms.
Before last year’s election, Alberta had, by far, Canada’s lowest taxes. It was the only province without a sales tax, which averages 7% in the other provinces. It had a flat 10% income tax; in other provinces, it averages 15% and up to 25% in Quebec. Alberta’s per-capita GDP was higher than that of the U.S., and typically 20% higher than the rest of Canada. It had the freest economy, and no provincial debt.
Now, they’re about to get a 7% sales tax, the income tax is graduated up to 15%, the province is taking on debt, and the legislature is active with lots of new regulations. And my read is that their real estate market is about to crash. Way too many people own multiple dwellings suffering negative cash flow.
Still, I suspect the average Canadian, or Albertan, is about a standard deviation better educated than his counterpart south of the border. Of course, that’s not saying much, especially when it comes to politics, which, in any event, is mainly an indicator of psychological aberration. Churchill was right when he said that the best argument against democracy was a five-minute conversation with the average voter.