Friday, October 05, 2007

Big Money Meeting Behind Closed Doors Today with Deputy Premier

So the National Post reports that some of the large capital investors are meeting behind closed doors with Deputy Premier Stevens today to add to “the-sky-is-falling message that for the energy industry to pay a fair share of taxes and royalties will put Alberta into recession. While the next story in this link shows unemployment in Canada is at a 33 year low.

I am sure there is a need for some confidentiality in these discussion with Deputy Premier Stevens. But as one of our Trustees for our natural resources, I am sure he will fully disclose what his visitors have presented to him by the end of today. Albertan deserve to know and transparency demands it.

The Globe and Mail Report on Business front page below the fold story today is interesting too. The headline is “Wall Street to Alberta: Don’t be so Stupid.” An “influential New York based analyst with Oppenheimer & Co.” is quoted as saying raising taxes on industries that are the “lifeblood of your economy…It’s so stupid – I thought these people were more sophisticated than that.”

Speaking of a lack of sophistication, I wonder if this influential analyst has read the Auditor General’s Report. We were such rubes that we have left $6B of oil and gas royalties alone on the table since 2005. That would have paid for school repairs, teacher’s unfunded pension liabilities and increases staff wages to liveable levels in Alberta’s social services sectors so we would not be endangering lives of disables Albertans.

The “Influential Analyst” says Albertan should attract investor, not repel investors.” Sir, perhaps you have been out of the loop as to the facts in Alberta. We have $140B of investors from all over the world keen to participate in Alberta with a 1% pre-production royalty and a 25% - soon to be 33% production royalty payable on their net profits. Pretty damn attractive I’d say…and based on the amount of money coming in…pretty damn effective too.

I find this other item in the Globe story too. It says this past May the Alberta Finance Minister, Dr. Lyle Oberg “returned to the city (New York) to assure analysts and investors that the new government of Premier Stelmach was …committed to a business-friendly investment climate.” A quote attributed to “one American Canada watcher” who was at the Oberg speech says: “There was never any indication there would be a move like this.”

Strange that Dr. Oberg did not mention this in his May meeting with the money men of New York. The Premier had announced the review on February 16, 2007 and it was to report to Dr. Oberg by August 31, 2007. It actually reported on Sept 18 but that is a quibble. Makes you wonder how far you can trust someone who omits such key information doesn’t it!

Too bad the Canada watcher did not know that this now Alberta Finance Minister was once kicked out of the government Caucus for his “misleading statements” over Klein’s political skeletons. Could the $6B royalty boondoggle Auditor General Dunn discovered have been the “skeleton Oberg was talking about? If so why didn’t he say so?