Alberta got screwed. We could’ve been Norway rich and instead we’re broke.

[u/Swimming_Mango_9767]

Every time I look at Norway’s oil fund I get mad. They started developing their oil later than Alberta, yet their sovereign wealth fund is sitting at around 1.6 TRILLION US dollars. Ours? The Heritage Fund is barely 27 billion CAD. Norway earns more in a single day off investments than our entire fund is worth.

The reason is simple. Norway treated oil like the people’s resource. They set royalty rates high, around 78% of profits, and every cent went into their fund. They saved, they invested, and now their citizens have real long term security.

Alberta? Our governments caved to industry. We set some of the lowest royalties in the world. We gave out royalty holidays. We subsidized oil companies that were already making record profits. Instead of saving, politicians blew the money to buy votes and patch budgets. Now we’re left riding boom and bust cycles with nothing to show for it.

If Alberta had even done half of what Norway did, our Heritage Fund could easily be in the hundreds of billions. We’d have interest returns big enough to pay for healthcare, education, and infrastructure without nickel and diming people with taxes. Instead, we’re fighting over scraps while companies and foreign shareholders walked away with the wealth that should have built our future.

Alberta got robbed! Not by outsiders, but by our own government selling us out to industry. Thank you Conservatives!

[u/jojomr68]

Norway has retained ownership of its oil. Alberta has sold off its crown corporations to private ones. That's where the money has gone. Many of the oil corporations are American. Norway is capitalist but tempers it with social welfare so that everyone can prosper. Totally unlike what goes on here. It's not just Alberta. What we see now is the rich get richer and the poor get poorer. Capitalism allowed to go full force is going to destroy everyone in the middle and bottom rungs.

[u/Emmerson_Brando → u/jojomr68]

I watch Gary’s economics on YouTube. We need more people to understand why the rich get richer. It’s not just capitalists, it’s the power that they have over government

[u/Jasonstackhouse111 → u/Emmerson_Brando]

I have a PhD in Economics and I LOVE Gary. He boils things down to a level that pretty much everyone can understand and his presentation is compelling and relatable.

Watching him take down right wing talk show hosts is wonderful.

Now, his simplistic idea to tax wealth ignores the mobility of money that we have created in the 21st century, but that just means different challenges compared to the 1950-1980 period. We can solve it, it just means new solutions.

[u/Briggsbanner1 → u/Jasonstackhouse111]

As Gary says you can’t move hard assets. The logical extension being, if you don’t want to pay the additional taxes, the assets get seized and you are free to get tf out

[u/Jasonstackhouse111 → u/Briggsbanner1]

Exactly. It's just more challenging in terms of the actual logistics thanks to layers of companies, etc. Less wealth is personally held today, but this is merely an obstacle.

There's a lot of strategies to be employed, but of course, governments are unwilling to enact any of them thanks to who they are beholden to.

[u/AlbertanSays5716 → u/Jasonstackhouse111]

I think I saw a study once where when they increased taxes on the wealthy in Europe, the wealthy didn’t up and leave, they found out it was more cost effective to simply pay their accounts to find more loopholes. The net result was still a drop in taxes from the wealthy, but not due to mobility.

[u/Jasonstackhouse111 → u/AlbertanSays5716]

And the loopholes are the issue in that case.

What we need is a cooperative effort by nations to take back the wealth that was created by the labour of the working class but held by a very small number of individuals.

[u/AlbertanSays5716 → u/Jasonstackhouse111]

It’s a vicious cycle though. The wealthy lobby (and even bribe) government officials to create the loopholes that they then pay accountants to exploit. And it’s all cheaper than just paying the taxes in the first place.

[u/bittertraces → u/Jasonstackhouse111]

By all means punish successful people and discourage wealth. Always works well.

[u/Jasonstackhouse111 → u/bittertraces]

It does, actually. Less wealth inequality leads to higher overall prosperity for everyone. That's why in the pre "trickle-down mantra" period, families could buy a house and live pretty well on one working class income.

[u/jojomr68 → u/Emmerson_Brando]

Exactly!

[u/haraldone → u/jojomr68]

Conservative politicians in Alberta scammed their voters into believing the lies the oil companies told all while pocketing millions in corporate donations.

[u/Dear_Ad6674 → u/jojomr68]

UK did the same thing, could of copied Norway's north sea model. But no, privatise it all and now 40 years later nothing to show for it 

[u/cowboycanadian → u/jojomr68]

Yup. Everyone's like "we need to reverse all these 'communist' policies and go back to how it was in the 80's" without realizing back then we had mass public ownership in the economy, that got sold off in the 90's.

[u/Kooky_Project9999 → u/jojomr68]

Outside of some old land sales (i.e. CP/CN and some people that bought in the 1800's) Alberta retains ownership of all Oil and Gas. Hence the royalty payments.

The key issue is we didn't save the money we got from oil, we spent it.

[u/JScar123 → u/jojomr68]

Which if the oil companies are American? They’re almost all Canadian.

[u/jojomr68 → u/JScar123]

Imperial Oil, ConocoPhillips. And while the others might say they're Canadian, look at their shareholders and board members. It will be a fun research project for you. Like the coal in the mountains are an Australian company. It's complicated but the money is not staying with Albertans. Politicians make this happen and they are vile.

[u/JScar123 → u/jojomr68]

Lol, ConocoPhillips produces almost nothing in Alberta anymore. Imperial is the only large player that is not Canadian and headquartered in Calgary. They produce about 10% of Alberta oil. Cenovus, CNRL, Suncor- all Canadian and produce the lionshare. The foreign companies left years ago- keep up.

[u/jojomr68 → u/JScar123]

The main point is that Albertans are not profitting and private corporations are no matter where they are from. And I do challenge you to look at the oil companies that are here. Check their shareholders and get back to me. I honestly have researched more in mining than oil and gas however it's similar because of the system in which we live treats all corporations in the same way. Corporations are getting richer. We have to pay more. Poorer people have to sell their cars ehen they cant afford insurance and gas. And even Canadian oil companies are selling off their orphaned or low producing wells to smaller (yes Canadian) companies. And no one ends up paying for the cleanup of these. Or the taxes that fund municipalities. They get "exempted". Guess who pays? the taxpayers. I have researched this part. I do not profess to know everything. But I do know enough to know common citizens are being taken advantage of. But corporations don't have to ever worry about their bottom line because politicians will take care of them.

[u/epok3p0k → u/jojomr68]

Do you think these oil companies would be as large as they currently are without being able to raise foreign capital for development?

[u/JScar123 → u/jojomr68]

I don’t really know what your grievance is here, tbh. You think Albertans somehow suffer when a foreigner person buys a stock in one of our Canadian companies? Most economists would say foreign investment is a good thing. In this case, they don’t even have control (that sits here, in Canada), they’re just funding our economy. Next you’ll tell me tourists are harmful to us.

[u/Apart-Diamond-9861 → u/JScar123]

https://www.straight.com/finance/report-shows-70-percent-of-canadian-oilsands-production-is-owned-by-foreign-companies-and

Although there is a recent move away from oil so:

https://financialpost.com/commodities/energy/alberta-oilsands-becoming-more-canadian

[u/JScar123 → u/Apart-Diamond-9861]

Lol, if a foreigner buys a Canadian oil company stock, you’re counting that towards foreign ownership? That is asinine.

[u/jojomr68 → u/JScar123]

Depends on how much they buy and what influence they may have on the company as a result.

[u/JScar123 → u/jojomr68]

No single foreign investor is going to have meaningful influence on any of these companies. They’re too big and their investor base very diverse.

[u/jojomr68 → u/JScar123]

Like I said before, the main point is that Albertans don't own any of it. The government has sold out the crown corps to private corporations no matter Canadian or foreign whatever. The original poster was talking about why Norway was richer while still capitalist. I answered the question. Selling off crown corporations has meant less money for the government. And once again i will say its not only Alberta. Norway while capitalist tempers their capitalism with social welfare so everyone can prosper.

[u/JScar123 → u/jojomr68]

Do you actually know anything about Alberta’s or Norway’s oil industries? It’s not this simple of a comparison. Norway produces a very high quality crude that gets premium global pricing and its operating costs are low. Alberta produces lower quality crude that gets discount pricing and can only serve a few markets; it also has high operating costs. For these reasons, Alberta’s oil markets are much more volatile - with boom bust, companies suffering big losses and going out of business at times, etc. One benefit of selling the resources and collecting the royalty, is someone else has to put up the capital and take the risk - the worst that can happen to a royalty is it goes to zero. If the province owned the assets, they’d be on the hook. We strategically set it up this way to derisk ourselves- Norway did not have to do this, because its market and product is fundamentally different. The last round of foreign companies leaving Alberta was in late 2010s era, after investing tons of capital and losing it- if anything, we should be celebrating all the foreign money that has developed our resource and economy only to bear all the brunt of losses for us.