http://en.wikipedia.org/wiki/Resource_curse
The zealous pursuit of dirty oil is transforming Canada into a corrupt petro-state
~ Andrew Nikiforuk.
(Andrew Nikiforuk is an award winning Calgary-based journalist and author of Tar Sands: Dirty Oil and the Future of The Continent.)
http://www.andrewnikiforuk.com/
Alberta now suffers from too much of a good thing or what some wags call "the paradox of plenty."
The whole sorry predicament confirms what many citizens still find impossible to accept – that Alberta is just another troubled petro state.
For decades, economists have thoroughly documented that governments that run on oil revenue don’t behave normally. They not only lose their civil discipline, but eventually stop representing taxpayers altogether. The state, in short, becomes oil fettered, oil stained and oil obsessed. Political scientist Terry Karl defines the unhealthy addiction bluntly: “Oil revenues are the catalyst for a chronic tendency of the state to become over-extended, over-centralized and captured by special interests.”
... Nobel prize-winning economist Joseph Stiglitz have commented on the peculiar and often destructive character of petro states. In an essay on Russia’s petro rulers, Peter Rutland, a U.S. scholar, recently noted that resource wealth also poses a hefty moral hazard: “The society (and its leaders) start to think that it is richerthan it really is, and fritters away the energy rents in excessive consumption or infrastructure investment. Social inequality and political instability tends to increase."
Perhaps the first major symptom of "petrolization" are low taxes. Oil states, such as Wyoming, Alaska and Saudi Arabia run on hydrocarbon revenue and tax their citizens lightly or not at all, notes Karl.
Even Alberta Finance, which can't balance a provincial budget, still proudly proclaims on its website that the province has the lowest personal taxes in Canada and among the lowest business taxes.
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