Alberta's Drastic Response To Debt Draws Attention
PERCHED on a low brick wall in downtown Edmonton, Richard Czerniecki is spending part of his lunch hour doing a balancing act - pen in one hand, checkbook in the other.
It is not easy for the Polish immigrant, who works full-time as a waiter, to pay his way through university. He struggles each month to keep in the black, he says.
It is precisely this sort of financial rigor that Mr. Czerniecki, who arrived here in 1989 and took the oath of Canadian citizenship in March, says he expects of his provincial government as it deals with a galloping deficit.
``The government is supposed to cut the debt, and we have to support the government,'' he says.
As Premier Ralph Klein attempts to tackle Alberta's fiscal troubles, cutting deeply into social services, Czerniecki's support is not universal among Albertans. But ``Ralph's revolution'' is being closely watched by politicians in other provinces that are also facing severe budget problems.
Premier Klein has abruptly and severely slashed everything from hospitals to kindergartens in an attempt to pare down the deficit. At the same time he has refused to raise taxes.
The irony of Alberta's situation is that it is considered Canada's third-wealthiest province after Ontario and British Columbia. Rich in oil and gas, the province spent freely on hospitals, schools, roads, and industrial projects in the 1970s and 1980s. But by 1992, falling oil prices and recession had taken their toll: a C$3.4 billion (US$2.5 billion) deficit and a cumulative debt of C$15 billion. Klein was elected in June 1993 promising to do something about the deficits - without raising taxes.
The no-tax promise is a familiar one few Canadians take seriously. But while other mired provinces have hiked taxes, Alberta's Klein has refused to do so. ``People don't want us to pick their pockets to spend money on their behalf,'' an apparently unworried Klein told a Canadian news magazine earlier this year. ``They want to have the money in their pockets and be able to create economic growth.''
But making ends meet without new taxes has forced Klein to wield an extra-sharp budget ax. In his first year, Klein lopped C$900 million from the provincial budget, halving what was Canada's largest provincial deficit on a per-capita basis. In June he revealed plans to cut C$950 million more in order to balance the budget by 1997.
``Klein's approach is particularly startling in Canada, which has usually taken a gradual approach to deficit cutting,'' says Allan Tupper, a political scientist at the University of Alberta in Edmonton.
Public employees have already taken a 5 percent pay cut. Tightened welfare policies have cut more than 30,000 recipients from the roles. Government department budgets will be cut by as much as 45 percent over three years. Education will be cut by C$239 million over three years, along with a C$734 million cut in health care. This fall, several hospitals will close, and the school system is cutting staff. Klein outraged parents and teachers by zapping C$23 million budgeted for kindergarten programs.
Some measures - particularly cutting welfare - are popular among the electorate. Others, such as the cuts in education, are much less so.
Just which point of view Albertans adopt depends greatly on where he or she is sitting when Klein's ax falls here in Canada's fourth-largest province by population.
The undisputed king of Canadian budget cutting to his admirers, Klein is also the unquestioned master of disaster to his detractors. ``I think he's doing this much too severely,'' says Lora Wadsworth, who is waiting for a bus. ``The cuts to hospitals and social services are being done too quickly and too deeply.''
``Mr. Klein's revolution is more than an economic revolution, it's a hugely negative social revolution in terms of the loss of many public services that have been cornerstones of our society,'' says Bauni Mackay, president of the Alberta Teachers' Association.
So far Klein's popularity has remained remarkably intact, around 50 percent, polls show, despite vocal opposition from many groups.
For 2.6 million Albertans, the gregarious former television reporter who ran for mayor of Calgary and won three times, tends to evoke either love or loathing.
``He's doing a great job,'' says broad-shouldered Roy Jutzi, a retired iron worker sauntering down Jasper Avenue in downtown Edmonton. ``He's doing very well what he promised to do - cut down on spending.''
Just down the street, however, Maureen Burns, an accountant who moved from London to Edmonton in 1982, is not pleased with Klein.
``Instead of making such drastic across-the-board cuts, he should be looking at things like a reduced work week or job sharing,'' Ms. Burns says. ``His people seem to have all the buzz words. There's a lot of management theory, but not much substance.''
Czerniecki, the student-waiter, is circumspect, however. Despite some concerns, he supports Klein. ``I guess the bottom line is who is going to be responsible,'' he says. ``Sooner or later we have to say, `guys, look, someone has to pay for all of this.' ''