Crude Crisis Pushes Alberta Voters Left Amid Prentice Austerity

As Brian Stokes sees it, the long-awaited breakthrough for the Alberta New Democrats came earlier this month when fundraising figures landed on his desk.

The executive director of the pro-labor party was gearing up for May 5 elections that many expected Premier Jim Prentice and his Progressive Conservative party to win in a landslide. Stokes’ numbers revealed something else: the Alberta NDP had a record first-quarter, with more individual donors than the PCs.

“That was the turning point,” Stokes, 34, who’s also deputy campaign director, said in an April 27 interview. “New money walking in the door without us going after it.”

It’s a turning point that may end a political dynasty in oil-rich Alberta, a province that’s handed majority governments to the PCs since 1971. Polls show the NDP’s surge along with a Liberal collapse and continued strength of the right-wing Wildrose Party is leaving Prentice in a three-way race. A minority government, which would be Alberta’s first, is the most-likely outcome.

Alberta is a rich, young and increasingly urban province. Its population is 27 percent larger than a decade ago and now includes a higher share of city dwellers than ever before, at 83 percent, third-highest in the country. Among Canada’s 10 provinces, Alberta’s median age is the lowest and its household income the highest.

Lurching Left

That means shifting sands for the PC party and Prentice, who became Premier in September. The NDP, marginalized since the 1980s, are surging, corralling the centrist vote and taking advantage of the unpopularity of Prentice’s austerity budget delivered last month.

In some polls, Prentice’s party trails both the NDP and the right-of-center Wildrose Party, which had been its chief rival. The PCs won the 2012 election by lurching left, urging voters to support them to stop Wildrose.

“We won because we were able to instill fear,” says Stephen Carter, who worked as a senior campaign strategist for the PCs in 2012. Things are different this time, he says.

The PCs “wedged themselves” with their budget, Carter says. It raised personal taxes, angering the right, while cutting services and leaving corporate taxes unchanged, upsetting the left. “They’re fighting a two-front war. We only had to fight a one-front war.”

Star Candidates

It wasn’t supposed to be like this.

Prentice, 58, called the election a year ahead of time while leading in polls. Even as crude prices collapsed from $107 a barrel in July to $42 on March 18, star candidates lined up to run for him, including Wildrose’s own leader, Danielle Smith, who defected with half her caucus in December, former Edmonton mayor Stephen Mandel and Rick Hanson, Calgary’s former police chief.

Hanson, 60, had been winding down his term as chief when Prentice called and asked him to broaden the crime prevention and intervention strategy he’d implemented in Calgary across the province.

“The opportunity to continue with public service and implement things that are in the best interest of the province” is why he agreed to run for Prentice, he said in an April 26 interview.

Then came the budget. The March 26 fiscal plan proposed increasing gasoline and income taxes and introducing a health-care levy, all to make up for lost oil revenue. The government projected a 2015-16 deficit of C$4.99 billion ($4.17 billion), the second-largest shortfall after Ontario. Some Albertans, long the envy of other Canadians for paying no provincial sales tax, were outraged.

‘Real Frustration’

“Early on, the first week there was a real frustration with not understanding why the budget came out as it did,” Hanson said, adding he believes some voters don’t understand the magnitude of change needed to make up the fall in oil revenue. “There’s no doubt that nobody likes to see change.”

Hanson is now among PC candidates facing tight races in Calgary, hub of the nation’s oil industry. With polls showing the NDP in control of Edmonton and Wildrose strong in rural areas, Calgary is expected to determine the outcome of the race.

Prentice, speaking on Calgary radio Wednesday morning, called for voters to elect a PC majority, an outcome at odds with the polling forecasts.

“I don’t worry about polls. There’s one poll that matters and that’s on May 5,” Prentice told News Talk 770, where hosts grilled him on his budget and controversies involving several of his PC candidates.

‘Fed Up’

Prentice blamed PC tax increases on the crude drop, saying deeper cuts would risk triggering a recession. “Nobody likes taxes. I don’t like taxes. But we have lost C$18 billion in revenue over the next three years. So what are we going to do?”

NDP Leader Rachel Notley has some ideas. Notley, 51, whose father led the party three decades ago, proposes raising corporate taxes and reviewing how much companies pay in royalties.

“People are really angry with Prentice and the PCs. They’re fed up,” Stokes said. “And we’re well-positioned.”

The NDP campaign hasn’t been flawless: they made an error in their budget platform that they corrected afterward, forcing them to bump back by a year the target date for balancing the province’s books.

The party also opposes Enbridge Inc.’s Northern Gateway pipeline, saying it would prefer to build upgraders rather than exporting raw oil sands bitumen. Yet a former Alberta finance minister has warned cost overruns at an upgrader under construction would leave Albertans on the hook for billions in costs and subsidies.

Massive Majority

Advance voting began Thursday, leaving the parties with little time. In 2012, when turnout soared to 54 percent from 41 percent four years earlier, 14 percent of votes were cast ahead of election day.

Polling aggregator shows the NDP in the lead with 35 percent, followed by Wildrose with 32 percent and the PCs with 25 percent.

Although that suggests a tight race, Albertans are rightfully skeptical of polls. Almost all prognostications pointed to the PCs losing in 2012 elections. Instead, they won a massive majority by wooing centrists in the final week.

The NDP surge means that probably won’t work for the PCs this time. They “seem to have made the decision to take the opposite gambit -- try to scare the Wildrose voters about the socialist hordes,” said Corey Hogan, former executive director of the Alberta Liberals, now director of engagement strategies at Hill & Knowlton in Calgary.

Polling Simulator

The Liberals aren’t fielding a full slate of candidates in this race, buoying the NDP.

Yet Prentice still has a shot. A polling simulator Hogan and his firm developed using historical data shows what he calls the “inefficiency” of the NDP vote, where the party would need to run away with the popular vote to win enough seats to form government.

Conversely, the simulator shows Prentice’s party is “much better positioned” than the others, says Hogan, who predicts Alberta will elect its first-ever minority government.

Among the factors that could influence the election in its final days is hockey. For the first time in more than a decade, the Calgary Flames advanced to the second round in National Hockey League playoffs. “The Flames are going to be the story du jour, and that’s going to be really tricky,” Carter says, because the electorate will be distracted.

Another determinant may be any potentially damaging information the wealthy PC campaign can dig up on the other parties. “I think we’re about to find out what half-a-million dollars in opposition research can buy,” Hogan says.

For Hanson, the former police chief, the election has become a decision about whether Alberta is prepared to abandon its long-held conservative bias.

“It’s become an ideology discussion,” he said. Alberta recently elected mayors in the two biggest cities that buck the conservative trend. “Is this a PC province with conservative policies around business, or is the ideology more prepared to shift to the left?”

Before it's here, it's on the Bloomberg Terminal. LEARN MORE