Saskatchewan Is Still Behind
With all of its recent economic prosperity, it's easy to overlook the ways in which Saskatchewan is still falling behind the rest of Canada. It's been eight years since the New Democrats met their fate when Brad Wall's budding Saskatchewan Party bumped them out of the legislature. When sixteen years of archaic socialism finally appeared to come to an end, many thought the province would begin revolutionizing its economy and its culture. Eight years later, the clock is still ticking and Brad Wall's incremental and painfully careful leadership style is growing old.
With so much under his belt, it's hard to criticize Brad Wall. The provincial debt has shrunk and resource revenues have doubled since 2007. Saskatchewan's economy has been slightly diversified in eight years, but much of the province's growth is due to expansions in oil and natural gas. With the growth in oil and gas comes the growth in population. With population growth comes easy and effortless increases in tax revenue. When we broaden our scrutiny of Saskatchewan's economy, we actually see very little changes in the overall socialist culture that has shaped the province since the early 1900s. It turns out that the province's energy sector is responsible for most of Saskatchewan's growth. With this growth in the energy sector comes the illusion of steady, sound economic leadership. Above all, it creates the illusion that Saskatchewan has changed.
If oil prices were to bottom out permanently, Saskatchewan would end up looking exactly as it did a decade ago. It might even look worse.
Since Brad Wall took office in 2007, provincial budget surpluses have been steadily declining. If resource royalties shrunk back down to their pre-2007 levels and the population followed suit, the province would begin to run big budget deficits. To summarize, government revenues have grown considerably since 2007, but budget surpluses have been shrinking. Any honest economist would diagnose Saskatchewan's current fiscal situation as teetering.
Saskatchewan's culture hasn't changed. The economy is experiencing temporary gains that won't last, because the current governing party hasn't worked hard enough or fast enough at dismantling Saskatchewan's socialist framework. Despite seeing a change in government, Saskatchewan hasn't seen any significant changes that benefit small businesses, entrepreneurs, working class families, or anyone who isn't in the energy sector.
One of the main harbingers of jobs, money and innovation are corporations. As it stands today, Alberta, BC and Ontario are steps ahead of Saskatchewan in attracting corporations. Saskatchewan's general corporate tax rate is 12%. It was reduced in 2008, but it was only brought down to reasonable and average levels, putting it at par with Manitoba and New Brunswick. Ontario's general tax for corporations is 11.5%. British Columbia's is 11% and Alberta's is 10%. Saskatchewan's corporate tax rate is even higher than Quebec's rate of 11.9%.
Although Saskatchewan has the second lowest tax rate for small businesses, entrepreneurs and small shops can only strive in a wealthy, diverse economy where people are willing to spend their money. Saskatchewan's economy still doesn't qualify as a strong, supportive place for small businesses. Before the Saskatchewan Party, downtown Regina was a mess of vacant office buildings and storefronts. In 2014, it still was. Small businesses just can't survive as well in Saskatchewan as they can elsewhere. That hasn't changed since 2007.
As for tourism, there still isn't anything to see in Saskatchewan. That's not Brad Wall's fault or the NDP's fault, but when we consider how much there is to see in Nevada, we can conclude that there are things a government can do – or quit doing – to attract tourism. As it stands today, casinos are still under the jurisdiction of the government, as is almost everything else in Saskatchewan. The province's primitive and stubborn liquor regulations don't help either. In socialist Regina, city council even struck down the prospect of a new strip club.
"Saskatchewan is so flat that if you look far enough into the distance you can see the back of your head." – A running joke
Still, in 2015, the province's one telecommunication company is government property. So is the province's only auto insurer, SGI. The Saskatchewan economy still limits other telecommunication and internet providers from accessing the market, as well as insurance providers. Eight years after Saskatchewan thought it ended socialism, we see that the province's economic prosperity has done nothing but usher in a new era of complacency and amnesia.
Most people in Saskatchewan can't even remember when the provincial sales tax was first implemented. It's been that long. It's been so long that the PST has become another daily expense that nobody thinks about. PST never went anywhere because general sales taxes are useful tools for politicians to keep around. Instead of eliminating them, they offer to decrease them whenever their fortunes are in danger leading up to an election. Stephen Harper did it with the GST and Brad Wall did it with the PST. The province's sales tax makes competition with Alberta impossible, not only from a business perspective but from a consumer perspective. Saskatchewan's PST makes everything more expensive for everyone, except for people who are looking to buy a used car.
Even Saskatchewan's income tax puts the province out of competition with Manitoba, Alberta and British Columbia, where income tax rates are lower.
It's difficult to admit, but Saskatchewan is still the very same socialist province it was in 2006. Despite what many dreamy eyed Brad Wall enthusiasts say, the backward, Marxist philosophies that have bound Saskatchewan to endless decades of economic stagnation haven't disappeared. Brad Wall hasn't been brave enough to tackle the sideways policies that have kept the province in the dark and decades behind the rest of Canada.
In 2003, it appeared that the Saskatchewan Party, under Elwin Hermanson, was sent a message. That message suggested that a slim majority of voters didn't want privatization or any of the dramatic economic reforms his party was offering. So by 2007, the party softened its image and toned down the controversy. However, there was still a hint of good, old fashioned right wing philosophy. Unfortunately, none of that ever materialized. Brad Wall proved to be nothing but a charismatic centrist who lost his backbone when it came to rocking the boat or confronting Saskatchewan's monopoly of unions.
Maybe Brad Wall fell in love with his soaring approval ratings and popularity in the early years, after his party stormed the legislature. That must be it. Nothing else could explain his fear and reluctance to let go of the centre and pass meaningful reforms that would likely shatter his popularity. His approval is sinking as steadily as his budget surpluses anyway, like most approval ratings do with time. It's been eight years and that slim 30-35% who wanted the economic reforms promised by Elwin Hermanson are getting tired of waiting. The unions still grip the throats of industries and the government still wards off corporations and businesses with taxes and regulations. People from across Canada, who have chased prosperity to Saskatchewan, still visit home at Christmas with nothing positive to tell their families.
After eight years of Brad Wall, Saskatchewan still has nothing much to offer but cold winters and violent crimes. None of this will change until Brad Wall finally chooses to put something else ahead of his own popularity.