Sunday, April 13, 2008

It's been a while...

Sorry for the lack of posts over the course of the last week. To say that it has been busy would be a gross understatement. As is customary after these absences, here comes a long post on anything and everything:


I was fortunate enough to be in Edmonton on Wednesday to watch the members of the PC caucus get sworn is as Members of the Legislative Assembly. In his post-ceremonial remarks, Lt. Gov. Norman Kwong referred to the new caucus as a "bumper crop". I couldn't agree more.

I was particularily humbled to see so many first-time MLAs, including a few great friends, get sworn in. The looks on their faces as they took the oath was truly inspiring, I look forward to watching them in action as spring sitting of the Legislature gets under way.

As a brief aside on this item, there was one MLA missing from the swearing-in ceremony. Calgary Lougheed MLA Dave Rodney stayed in Calgary to be with his wife as she prepared to give birth to their first child. A healthy Baby Rodney (I don't yet know his/her name) was born late in the week. Many congratulations from this humble scribe to Dave and Jennifer on their new addition!


Speaking of the upcoming session of the Legislature, Daveberta gives us a heads up that Edmonton Centre MLA Laurie Blakeman will be running against incumbent Speaker Ken Kowalski for the right to play referee under the dome.

I seriously had to check if this was a late April Fools post, or if it was for real. Turns out it's the latter.

Based on the rhetoric coming from the pro-opposition forces, it seems as though Ms. Blakeman is doing this to take a stand for women across Alberta. The dismissal of her chances by those of us over on Team Blue is also being spun as a sign that we don't take women seriously.

Au contraire, mes amis.

The reason that I and so many other conservatives pay little attention to Laurie Blakeman isn't because she's a woman. Its because she's highly melodramatic and generally unpleasant.

On the other hand, the notion of Bridget Pastoor running for Deputy Speaker isn't at all ridiculous. Ms. Pastoor is pretty well-liked by those of us on the other side of the aisle. She works hard, is forthright, and doesn't go around wailing into any available camera.

Honey versus vinegar... makes all the difference in the world when doing the people's business.


There are few people in the House of Commons who command respect like York Centre Liberal MP and former hockey great Ken Dryden.

Between his years of experience on the ice and in the boardroom, people know that when Ken Dryden says something, its worth listening to.

Or at least it used to be.

You see instead of getting Mr. Dryden to stand up and actually ask questions or make statements about things that actually matter to Canadians, he has become Stephane Dion's point man on the Chuck Cadman non-scandal.

This is perplexing for a couple of reasons. First, there are a plethora of nauseating attack dogs in the Liberal caucus. Mark Holland or Ruby Dhalla would love to have this file, I'm sure. And yet, for some reason, they gave to one of the few people who had any shreds of credibility left in the Liberal caucus.

The other reason that this is perplexing is that the only reason that the Liberals keep hounding on this non-story is to try and make some gains in British Columbia. And yet they get an MP from several thousand kilometers away to try and make their point. To me, this shows just how weak and inept their strategy AND the BC caucus is.


I have made little secret that I'm a big fan of Battle River-Wainwright MLA Doug Griffiths. His ability to see the big picture and apply it to circumstances in Alberta is exceptional. Recently, Doug wrote a note on Facebook about the current economic situation in the United States which he has graciously given me permission to share with you:

"I don't have an MBA, but I can't see how the new US policy is going to help turn the tide of their economic slowdown. In fact, I don't think it takes a PhD to see that what they are doing is going to amplify the problem and lead to a recession that will take years to recover from. Here is my reasoning, right or wrong.
Markets go through corrections all the time. Even in Edmonton the last two months have seen a drop in housing prices, but the correction is usually mild and short lived. The key to surviving it is to stay calm and hold. In the US there is a market correction going on that has been amplified by the sub-prime mortgage mistake. People who couldn't afford a house were give mortgage at below prime as an incentive to buy and so it was affordable to them. When they went to renew, between the depreciation in the property (the correction) and the new realistic mortgage rates, they couldn't afford the homes and had to walk away.
So now three things are happening at the same time. The US is lowering interest rates hoping to goose the economy. The US is dumping billions into the sub-prime mortgage crisis to stave of bank bankruptcies and help people refinance (again). The US is dumping billions into the economy to goose it through the downturn too. Three actions that might seem fine, but . . .
The US is not in the same position it was to fix other 'market corrections' because 1) they have a devalued/devaluing dollar that is creating subsector inflation (all goods imported will grow more expensive because you are buying them with American dollars that are worth less and less against other currencies - and the US imports a lot of goods) and 2) the US has a national debt that is growing rapidly and will shortly lead to new admonishments from the World Bank and significant trading nations (and that in turn leads to further depreciation against world currencies.)
So, all of this together means the US is feeding more and more dollars into a weaker and weaker economy that is already experiencing inflation. Those action will only generate more inflation as the currency continues to devalue and inflation grows. That is a potential runaway train. Now, all of this can easily be turned by raising interest rates marginally and slowly to slow spending, slow borrowing, and encourage savings and debt pay down. However, how do you do that when the policy is to keep rates low to turn the tide of the slowdown?
The result will mean out of control inflation and market collapse. The only way it will turn around at that point is for interst rates to rise to 15 - 20% for close to a decade (nothing else will slow inflation quickly or easily at that point) as we did here in Canada two decades ago.
The solution is to suffer small now for sake of the future. Maintain interest rates, or raise them slightly, and use all of that money they are putting towards this crisis and wars to pay down the national debt. This will restore confidence in the economy, raise the bond rating, restore a healthy debt ration from the individual right up to the government, and mean success in the future to deal with social issues. A few may suffer in the meantime by doing this, but all will suffer in the long run if they don't.
I am afraid they aren't ready for that, however. And we are tied so closely to the US, we must be prepared. It will be ugly unless they realize the errs of their way. But hey, I don't have an MBA."


  1. What, no new unsourced Dave Taylor rumours today? I was hoping we'd hear he was running for mayor of Calgary or was clinching the federal NDP nomination in Calgary Southwest.

  2. I say Griffiths gets the Nobel Prize for Economics. Anyone without an MBA who can roughly summarize the economic situation in the US, as reported in all the trashy American psuedo-news magazines thousands of times in the last year, is truly a genius.

    In fact, try to keep this under wraps, but I heard that Griffiths and Dave Taylor are going to be co-Finance Ministers once Taylor crosses the floor.

  3. Something tells me I've hit a raw nerve ;)

  4. You did a good step that you've posted a Doug's article. It was really interesting to read it through and I am fully agree with him. I am just not sure if solution he mentioned is possible. It is of course true that if rates will increase now economy will be affected even more for now but it also prepare a good preposition for future stabilization. But as we know there is election going on in US and nobody knows the result now. Anyway new president will face to a tricky task as well as Federal reserve. I am really glad that I am selling Toronto houses instead of American ones. Hopefully we will not be affected.

  5. How about the rumours surrounding you BR?.....are they true? You've been spotted in Oil country..