On minimum wage, comfort in the middle ground

Which is a worse social ill: people working at a job that does not pay a livable wage, or people losing their jobs so that those workers remaining can live on their wages?

These are the choices Albertans are being asked to consider in the public discussion around our new government's announced decision to raise the province's minimum wage to $15 an hour in three years.

Of course there are other, more middle-ground outcomes to consider, but when the lines are drawn in a debate about money — and who should have how much of it — the stark choices are the only ones we're generally shown.

Alberta currently has the second lowest minimum wage in Canada: $10.20 an hour.( The Northwest Territories pegs theirs at $10, but there are plans to raise that soon). Alberta also has the lowest percentage of people actually working at that wage: 1.8 per cent of workers, versus the national average of 6.8 per cent.

The majority of people working for minimum wage are under 25 years of age, and the provincial average wage for that group is reported to be $18 an hour — the upper end of the national scale for wages for young people.

Premier Rachel Notley ran on a platform that included boosting the minimum wage to $15 an hour, and the NDP platform became policy rather quickly.

Enter the economists. You can get as many predictions about the economic effects of changing the minimum wage as you can afford to pay for, but suffice to say the results are mixed.

Really, nobody knows what happens when the minimum wage is raised to a point where every person working full time can actually live independently on their salary. Chiefly because there are so few places where that's possible.

The cities of Los Angeles, San Francisco and Seattle have done, or are moving toward a $15 minimum hourly wage, and the outcome of debate there is that economists are happy to finally have a live, large, real-time social experiment to monitor.

The Canadian Federation of Independent Business points out numbers of job layoffs that would accompany each percentage increase in the minimum wage. They suggest that the near-50-per-cent hike proposed for Alberta could result in anywhere between 53,400 and 195,000 job losses.

When only 40,000 Albertans currently earn the minimum wage, it's hard to figure who would be left to serve our hamburgers, bus tables at restaurants and clean our hotel rooms, but there you are.

At $15 an hour, a full-time worker will earn about $28,000 a year, making that person a bona fide taxpayer. A full-time worker on Alberta's current minimum wage will gross less than $20,000 a year. Part of the consideration for those who monitor social policy experiments.

Nobody is proposing that we eliminate poverty by ensuring everyone makes at least $25 a hour. Likewise, nobody is proposing that a minimum wage law is the full answer to poverty. Questions around poverty, like unemployment and homelessness, cannot be resolved that simply.

Rather, the minimum wage is a justice issue, speaking to the value of anyone's labour. If you work for a day, you should be able to live for another day — and you can't do that for long on $10.25 an hour.

One interview of dozens you can find in the news streams comes from a representative of Edmonton's downtown business association. Business owners there aren't complaining to Jim Taylor, president of the association about the change.

One downtown Edmonton restaurant owner, who employs 25 people, says the change will have no effect on her operation.

The Canadian Association for Policy Alternatives studied the studies and even in traditionally low-paid jobs, they found no significant relationship between changes in minimum wage and labour market outcomes, 90 per cent of the time. (Meaning one business that lays people off is offset by other businesses that hire.)

Claims that higher wages have large-scale negative labour or economic consequences were not borne out by the studies reviewed.

But where else has the minimum wage been raised almost by half over three years? Not too many places. So in Alberta, the jury is definitely out.

So you can believe the social engineering types or the doomsayers on what will happen next. For now, anyway.

For myself, until the results are actually shown, I'll opt to look to the comfortable middle ground.

What's going to happen? More Albertans will likely become minimum wage-earners — and if they're careful with their dimes and dollars, they'll be able to be full citizens on that. Not that bad an outcome, I'd say.

As to the economists, I prefer John Kenneth Galbraith, who said the only function of economic forecasting is to make astrology look respectable.

A carbon tax is not enough; you need to pay me, too

The stars seem to be aligning for an improved carbon tax in Alberta. Goodness knows, there's plenty of room for improvement there.

Alberta, you will recall, was the first jurisdiction in North America to institute a tax penalty for greenhouse gas pollution, back in 2007. The tax was named by a committee that obviously stayed up way too late coming to agreement: it's called the Specified Gas Emitters Regulation.

The financial penalty under SGER has been pretty mild, the funds it raised have been poorly used and there is no indication anywhere that it served to reduce either intensity or total greenhouse gas emissions in the province.

The specified polluters pay $15 a tonne for that part of their carbon pollution that exceeds a baseline. The polluters only pay for a maximum of 12 per cent of their total emissions, and one document I found said it only costs the companies $1.80 a tonne to meet the targets.

The money went into a tech fund that mostly paid for research to help energy companies improve their own oil and gas production. The tax improved the lives of zero Albertans — except for those who administered the program and accessed the money. Zero as well, for the environment.

Still, the philosophy behind the plan was sound.

Globally, about 80 per cent of all greenhouse gas emissions are produced by consumers. We drive cars, we turn on our coffee makers in the morning, we heat our homes in the winter. Everything we do has a carbon footprint.

But the global numbers don't apply in Alberta. Because of the energy intensity of Alberta's heavy industry, our province produces a whopping 36 per cent of all the greenhouse gases produced in Canada. Our oilsands projects trump the influence of consumer emissions in our province, plus that of Ontario, or probably more.

That's why Suncor CEO Steve Williams is on board with a new carbon tax for Alberta. That also influenced how prime minister Stephen Harper recently set a national goal for Canada to reduce greenhouse gas emissions by 30 per cent in 15 years.

Canada simply can't become a better global citizen until we solve the problem of how to get those 168 billion barrels of oil out of the oilsands, using less energy.

Williams agrees to a carbon tax, but he wants it to be universal. He wants the consumers to be involved. That serves his purposes, because the vast majority of his customers burn Suncor's oil outside of Canada.

The federal government's plan is to help Suncor and all the other oilsands conglomerates buy carbon credits on the international market. No cap-and-trade for Canadians, no sir, no way — but globally, the Harper government makes it the cornerstone of our emissions reduction program. Go figure.

In the past, Albertans derided a carbon tax as merely a cash transfer from Alberta to the feds. Prime minister Harper wants to go that one better — by transferring the money right out of Canada.

I say we need a hybrid of the plans.

Williams is right: consumers do need to know that what they do has a pollution price. In British Columbia, that price (their carbon tax) replaces part of their income tax system. Ride a bike to work, reduce your taxes. Lower the thermostat a bit in the winter, reduce your taxes. Waste less, reduce your taxes.

But that can't be the total answer in Alberta. We could be pushing our bikes through deep snow (I've done it, and it's hard), and shivering in our homes all winter, and still not make a significant dent in Alberta's total emissions, because of the oilsands.

Nobody can reasonably suggest we leave the oilsands in the ground. No country sitting on 168 billion barrels of crude would do that. None.

So if carbon credits need to be bought, why not buy them from me? OK, and you.

We appear to have consensus here, so tax both consumers and the big producers. Use the money to both reduce the burden of other taxes and to encourage more non-fossil energy sources. I can adapt my behaviour to fit the program.

But more, make it easy for me to put a few solar panels on my house and garage. Pay me the full market rate for all the solar power that I don't use. Let the big power producers have a carbon credit from that, which they can sell.

The technology is improving rapidly for at-home storage of solar power, and industrial-grade storage of wind power. There's a huge potential for both total greenhouse gas reduction and carbon credits to offset Alberta's unique burden from oilsands production.

I could live with that, could you? Isn't that the philosophy behind what both Suncor CEO Steve Williams and prime minister Stephen Harper say they want? So if the consensus already exists for this, do it.

But let the consumers who want to become carbon conservers benefit — in cash, directly. That's the only way the plan will actually work.

Time for Prentice to look in the mirror

If I were the leader of a dynastic political party that hasn't had to actually fight an election in 40 years — in the face of the challenge mounted in Alberta by the NDP, and the voter anger I would have encountered at every stop on this election campaign — I'd probably monger all the fear I could.

The sky will fall, I'd say, all the drilling rigs will be pulled out of Alberta into Saskatchewan, and they'll horizontal drill 300 km west under the border and suck out all our oil. The NDP will tax you into poverty and then offer you a minimum wage job at $15 an hour.

Because I'd know that the first order of business for an NDP cabinet will be to get a thorough look at Alberta's books. I suspect they'll find stuff an outsider would never see under our so-called freedom-of-information laws. And these people know from experience parsing the bits that have come through their own FOI requests in the past, when red flags appear.

And I'd be so scared, that in my lowest moments I'd monger all the fear I could. But I would hope in the end that I had the strength of character to stand up and face the storm to come, if worse came to worst.

It came to the worst for placeholder premier Jim Prentice Tuesday. And his character was not up to the challenge of losing.

Now, if you think I'm kicking a man when he's down, please think about this: Jim Prentice was handed the premiership of the longest-ruling, richest elected government in the British Commonwealth, on a platter.

He won his Calgary-Foothills riding in a by-election cakewalk last October. He asked for — and won again — the right to speak for the people of Calgary-Foothills in our legislature by almost 1,400 votes on Tuesday. His riding has been a Tory stronghold ever since the Tories started running there, back in 1971.

If you think a person in that position is down, I suggest you talk to some NDP, Liberal or Alberta Party operatives, on the subject of grit, and perseverance. Because Prentice showed neither in defeat Tuesday.

They were still counting ballots in some ridings Tuesday night when Prentice told Albertans: “My contribution to public life is now at an end.”

What, was he contemplating something extreme, like a medieval Japanese samurai general who lost a critical battle? No, he's likely going to take a vacation far, far from Alberta, and see if he still has any friends in the banking industry.

Just who did the Progressive Conservatives elect as a leader? Whose interests was he sworn to uphold? Yours? Mine? The party's?

His own?

A real fighter would have sworn to return to fight again. Especially a fighter who, at least until recently, had the backing of Alberta's top-flight CEOs. Especially a fighter who believed in the cause.

Remember Bob Clark, the Olds-Didsbury MLA who became the rather lonely leader of the Social Credit Party? He — like a few of the newly-minted NDP MLAs elected Tuesday — was in his early 20s when he was first elected in 1960. He was education minister for a time under good old Ernest Manning.

When the roof fell in on the party, and it was down to four members, Clark stuck with it. He took the leadership, and was there while the last crumbs of Socred support disappeared in the face of the Tory juggernaut. An unelected Werner Schmidt took over the leadership in 1973, but Clark stayed on as a regular MLA.

Schmidt resigned in 1975, after a poor showing for the party in that election, and Clark — still elected, still representing Olds-Didsbury — stood up once again. He was there, fighting, until 1981.

For that, he was made Alberta Ethics Commissioner, a post he'd hold for 11 years after leaving elected politics.

That's what grit looks like.

Or talk to the Alberta NDP about perseverance. How long were they a joke in legislature hallways and Tory party fundraisers? How were these fuzzy-headed sandal-wearing noodniks treated during the Ralph Klein years and after?

But as for Prentice, if he couldn't have it on a silver platter, he didn't want it at all.

Which is an apt metaphor for what the Alberta Progressive Conservative Party has become.

You need to believe in something other than power itself, to govern. The power of Jim Prentice's beliefs are rather much in question now. He called a hasty election solely for the purposes of retaining power, and hastily left the field when it didn't go his way.

No doubt the party will be soul-searching in the next years, asking itself existential questions the opposition learned to deal with a long time ago.

But the one Albertan who needs a look in the mirror right now is Jim Prentice.

Follow Greg Neiman's blog at Readersadvocate.blogspot.ca