Haddow Press Experiment

Personally, I agree, I think the local market has played a couple years of catch-up and is now on par with many other major urban centers in Canada. The question is, if oil completely flopped tomorrow, would we still call Edmonton and Calgary major urban centers? Far-fetched hypothetical, I know, but we have put a lot of eggs in one basket, so to speak. Fact is, we’re land-locked and don’t have a water port. We only have a couple piddly little airports. And the railway here would never cut it for any significant manufacturing culture. Infrastructure is pressed to keep up with population, in Calgary in particular, and the only thing driving the economy in any significant way is the wake of oil and CONSTRUCTION. We’re not a self-sustaining society by ANY STRETCH of the imagination. We have a public transportation system that would barely receive a passing grade for a small town in Europe or Asia. Agriculture and food processing is heavily subsidized in dire need of a labour injection. And the bulk of the population is in (bad) debt up to their ears from depreciable, consumer goods.

Take a drive around any new neighborhood and there are $600K homes packed full of cheap IKEA furniture and using bedsheets for drapery, and a brand new BMW in the driveway. I’d wager the majority of those people have less than $25K in the bank — and a significant chunk have nothing or even OWE. Paycheck to paycheck, I think is the term.

Sure, people flocked here from all over to get work, drove a CONSTRUCTION boom, but then take their money and head back East. Many of those “amazing gains” are cashing out and going back to the Maritimes. Good on ‘em for a smart investment, but that money doesn’t come from nowhere: the next guy is paying that, and more and more the next guy is a young Albertan who has a six-figure salary at 21 but barely graduated high school. Watch the market pull back and that’s who’s holding the bag: young families who were lured out of a long term career by the siren call of a steaming hot economy. Then what do you do when someone won’t pay you a hundred grand to drive a truck? What do you do when people want college degrees again?

And big BUSINESS is even more vulnerable. Just because large companies are building processing facilities, plants, factories, and showrooms does not make us a long-term strategic society. Corporations have less to loose: shut the door, walk away, and let the governments and banks fight over who pays the tab.