Norway’s sovereign wealth fund, enacted 14 years after Alberta’s Heritage Trust Fund was established, is worth US$1.1 trillion. Alberta’s fund after 42 years is valued at US$13 billion.
Norway restricts governments from using any more than four per cent of their oil and gas royalties on annual government expenditures. The fund is for future generations when oil revenues collapse.
Recently some extra money has been pulled out and used to support the country’s transition to a fossil-fuel-free society.
Alberta’s Heritage Fund has been raided year-after-year and government- after-successive government.
It’s been used to balance the budget, give Alberta’s good hospitals, schools, highways and low taxes compared to other provinces. And, of course, sustain our pride in being the only province without a sales tax.
Today almost one-third of all cars sold in Norway are electric. Norway’s goal is to end sales of fossil fuel vehicles by 2025.
In Alberta, we’re lead to believe that electric vehicles can’t operate in northern climates.
Government policy is the motivator to change consumer behaviour.
Battery-driven cars in Norway are exempt from most taxes and receive free parking and charging hence the increase in their popularity.
Of course, that is the intent of a carbon tax. A consumption tax that was once favoured by right-wing parties as the market approach to pollution reduction.
By changing behaviour of consumers, it would encourage risk-adverse, profit-takers to invest in emerging industries and away from carbon-intensive industries.
Today the Arctic and coastal regions are the most affected by global warming.
Canada and Norway are both coastal and Arctic countries but unlike Canada, Norwegians collectively are serious about their international responsibility to reduce carbon emissions and save their country for future generations.
The board of the Norwegian Sovereign Wealth Fund has recently announced they will over time divest from all oil and gas companies, including Norwegian energy firms.
They want their fund and their economy protected from future oil shocks.
In Alberta, we live the vicious cycle.
When oil prices are high, oil companies pay huge salaries, give their employees shares in the company as bonuses and pension contributions and high wages which drives up the price of homes.
When oil prices slump, Albertans associated with the oil patch not only lose their jobs, they lose value in their investments and their home prices collapse.
The three most important pillars to financial stability are jobs, investments and real estate which in Alberta all increase and collapse simultaneously.
Our province’s economy isn’t diversified, but neither are many of our households.
Regretfully we’ve let so much cash slip through our fingers, provincially and personally, throughout the last four decades with little planning or concern for the future.
We could learn so much from Norway, but, alas, we must first collectively believe that man-made climate change is real and, second, that a sales tax is necessary to smooth out our boom-bust economy.