This article was originally published on Troymedia.com April 26, 2015
It’s no fun being an Albertan: Alberta needs a New Economic Vision based on Well-being
According to Statistics Canada, Alberta ranks 7th overall in life satisfaction in 2013 with PEI and Saskatchewan ranking No. 1 and No. 2. Edmonton ranked 30th and Calgary 23rd amongst 33 Canadian cities in terms of life satisfaction, in the most recent survey of Canadians happiness.
Table 1: 2013 Canadian Cities Happiness Ranking
|Rankings based on 9-10 happiness scores|
|1||Greater Sudbury (Ont.)||44.9|
|2||Thunder Bay (Ont.)||43.9|
|3||St. John’s (N.L.)||43.7|
|4||Saint John (N.B.)||43.6|
|16||St. Catharines–Niagara (Ont.)||38.1|
Hard to believe, isn’t it? After all, at $84,390, Alberta has the highest per capital income in the nation.
Now look at these figures:
- one in five working Albertans (20 per cent) earns less than a living wage ($15.00/hour)
- the average Alberta household debt is now $124,838, adding strain to family life and unnecessary stresses on our healthcare system
- 1 per cent of Albertans experience quite of lot of stress in their lives (Alberta ranked 10th amongst the provinces and territories), with Newfoundland being the least stress province (15.2 per cent experience stress)
- only 63.6 per cent of Albertans felt a strong sense of belonging to their community. That placed us 12th, just ahead of lowest-ranked Quebec. Nunavut has the highest sense of belonging.
And let’s not forget our unfunded social and human capital liabilities. Our First Nations, for example, are living in poverty and hopelessness with seriously high rates of suicide.
The Genuine Wealth Institute has estimated that the province’s Genuine Progress Indicator (GPI), a broad measure of societal well-being (what I like to call the Happiness Index), declined 0.5 per cent per year between1961 to 2003, while real Gross Domestic Product (GDP) per capita increased steadily by about 2.2 per cent per year. I guess it’s true that money can’t buy happiness.
Today, in the midst of another provincial election, maybe it is time to move on to a new aspirational vision for Alberta, one based on individual and collective “happiness”, using our abundant natural assets (oil, gas, agricultural lands, forests and clean water), our human capital, our social capital (relationships, trust) and our entrepreneurial spirit to build a better, more just economy.
But using a well-being-based investment approach to governing the province would require establishing a new strategic vision of the future.
Maybe the past can offer us some guidance.
When Peter Lougheed was elected as Premier in 1971, he led his team with a new vision for Alberta that included championing the oil and gas industry and developing the oil sands. But his vision also included collecting a fair share of royalties based on the value of oil and gas sales and putting aside 30 per cent or more of this money in Alberta’s Heritage Savings and Trust Fund. He did this to ensure Albertans received an appropriate return-on-equity for our natural resources.
During the Lougheed years, royalties on oil and gas averaged 27 per cent of their value. Unfortunately, beginning in 1985 the rate of return to Albertans from oil and gas sales has been steadily falling, reaching its lowest level during Alison Redford’s tenure.
The Alberta government (as do all governments in Canada) currently operates without a balance sheet, so my first recommendation would be that we conduct a review of the real total wealth held by the province. That review will give us the tools to properly manage our natural capital and optimize our human and social capital assets as well. It could be a game changer for the province.
By developing a new economy of well-being – one centred on individual and collective ‘happiness’ and based on optimizing our abundant natural assets (oil, gas, agricultural lands, forests and clean water), our human capital, our social capital (relationships, trust) and our entrepreneurial spirit – Alberta can become an example for other provinces to follow.
Alberta could become a model economy of well-being following the lead of China and Bhutan who have adopted a new economic paradigm based on well-being and happiness. The Chinese model is based on an ancient Confucian idea of ‘xiaokang’ which is means ‘a society of well-being’ where economic growth is balanced with sometimes conflicting goals of social equality and environmental protection.
Given the present unhappy state of our province’s well-being, I encourage all Albertan’s to ask their candidates in the provincial election if they would support an economy of well-being and creating a much better future for our children and grandchildren.
Mark Anielski is an economist and co-founder of the Genuine Wealth Institute, an economic think-tank whose mission is to provide practical ideas, analytics and solutions for businesses, communities, and nations in building the new economy of well-being. Mark served as senior economic advisor to China between 2003-2007 and is an economic advisor to Bhutan.