There are many downsides to the practice, beyond just the obvious and flagrant misuse of taxpayer dollars
While conservative parties and politicians might be more likely to criticize or oppose corporate welfare, the sad truth is that governments of all stripes are guilty of it — even here in Alberta.
Despite an ostensible focus on keeping spending in check and holding to conservative economic principles, Alberta’s government is poised to embark upon yet another costly round of corporate welfare.
There are many downsides to the practice, beyond just the obvious and flagrant misuse of taxpayer dollars. As noted in the study, “governments’ attempts to pick winners by interfering in the free market ultimately distort private decisions and misallocate resources.” There’s also the concern that such decisions could be politically driven, with such spending aimed at shoring up political support in certain regions or simply to reward friends or allies of the government.
When it comes to the public dollars that could soon be flowing to or benefiting private oil and gas companies and private education schools, these are all very real concerns. Yes, ensuring that abandoned oil and gas wells are cleaned up and that Alberta has sufficient classroom capacity are very real and pressing priorities, and no doubt the government will emphasize those points. That, however, doesn’t justify unfettered spending.
The groundwork for all of this was laid out last week in separate announcements from the premier and various cabinet ministers.
Companies have a legal obligation to clean up their sites. And, indeed, many companies have lived up to that obligation. It’s unfair to those that have done the right thing to now have government start throwing money at those who have dragged their feet. That creates the wrong kind of incentive and is not how taxpayer dollars should be allocated.
This obviously puts existing private schools that have financed their own capital costs at a severe disadvantage. It also incentivizes those prepared to make such investments in the short term to hold off, and try to take advantage of these government subsidies. Again, it’s an improper and unfair use of taxpayer dollars.
With all these pressures, it’s going to be hard enough as it is for the Alberta government to hold the line on spending.
Let’s not make the situation worse with unnecessary handouts to businesses.
Afternoons with Rob Breakenridge airs weekdays from 12:30 to 3 p.m. on QR Calgary Radio