As I'm on the mailing list of all federal parties (I've been slowly blocking their incessant emails from my inbox) I get a lot of mail from the leadership candidates for the CPC. This morning, I got an email from Maxime Bernier. It reads as follows:
John, it’s time to reform Equalization in Canada.
When I launched my leadership campaign last May, I made it clear that all my policies would be based on four key principles:
Freedom, fairness, responsibility, and respect.
Canada’s equalization program is unfair, and inefficient.
It must change.
Albertans are out of work and still paying for social programs in provinces with stronger economies than their own.
It’s not fair.
Equalization is a poverty trap that stops provinces from developing to their full potential.
It’s a badly designed welfare program that discourages growth.
The equalization formula counts a province’s energy revenue. But, it doesn’t treat all forms of energy revenues the same way.
It’s time to stop rewarding provincial governments for bad policy.
As leader of the Conservative Party of Canada and prime minister, I will freeze the budget for the equalization program.
Second, I’ll have a committee review the budget, and propose a new formula.
That new formula must end the provincial equalization welfare trap.
My plan is based on freedom, fairness, responsibility, and respect.
I will lower taxes for every single Canadian.
I will end corporate welfare, and lower taxes for every single business.
I will remove barriers to trade within Canada.
And under my plan, the so-called “have-not” provinces will have all the tools they need to unleash their full economic potential.
----
I have several problems with this email. First, Alberta isn't paying for social programs in other provinces. That's a common misconception about the equalization system that Bernier is exploiting. Second, Alberta is still not a recipient of the program for good reason; even with the recent downturn which has been very hard on their economy, their per capita GDP based on the latest available numbers is still far stronger than that of pretty much any other jurisdiction in Canada.
On the other hand, I do see room to improve the system. I think that all potential revenues should be included, and I think there should be a mechanism to adjust the system quickly for catastrophic changes to the negative. It ends up costing Ottawa a lot of money in down years when they're relying on fiscal data from strong years to make the calculations.