Some things always come in pairs. Income and taxes. Salt and pepper.
Mary-Kate and Ashley. You never see one without the other.
In Alberta, you can add "boom" and "bust" to the list of famous pairs. With every economic boom comes the inevitable bust. The province has a track record that makes this a truism. It's so entrenched in the provincial psyche that, in this current boom, many Albertans are already whispering, "Yeah, it's just not going to last."
It seems that the bigger the boom, the bigger the bust that follows. Take the boom of the 1970s. Population growth, housing starts, and construction activity smashed all records.
But by 1981 - for a variety of reasons, the most obvious being the collapse of oil prices - the boom had turned into a nasty bust that lasted the better part of the next decade. The real-estate bubble had burst, a hard slap in the face for many who had overextended themselves. Some simply walked away from their mortgaged homes.
There are frightening similarities between Alberta in 1979 and Alberta in 2007. Today, real-estate prices are soaring, migration to the province is near record levels and labour shortages are the big problem du jour. Rising energy prices, particularly for crude oil, is another common theme.
Can Alberta dodge the bust bullet this time around?
While there are some eerie comparisons with the late 1970s, there are some fundamental differences too.
In the early 1980s, global energy prices collapsed for reasons related to OPEC losing its muster, increasing global supply and a sagging U.S. economy.
In 2007, however, global energy prices are being supported by starkly different factors. Surging demand in developing countries (such as China) and oil-addicted consumers in the West will ensure at least five more years of high global oil prices, according to the erudite International Energy Agency.
In short, the falling oil prices of the 1980s were being driven by a glut of supply. Today, rising prices are being driven by insatiable demand - and a lack of new supply.
None of this is to say that energy prices will never fall. But how low would they have to fall to bust Alberta's boom?
Because of extraction costs, the viability of many of the oil-sands projects becomes iffy under $50 (U.S.) a barrel. For prices to drop below that point - and stay there - would require a series of things to happen: a major global recession, an end to geopolitical tensions in the Middle East, a sudden discovery of massive oil deposits where no one thought to look before or a wonderful new invention enabling cars to run on salt water.
A major global recession scenario is looking unlikely. Sudden peace in the Mideast seems improbable. And the other two are purely impossible.
So where does that leave Alberta? If oil prices do in fact remain at their lofty levels, it's possible that the boom-and-bust cycle could be broken. A likely scenario for the province's economy in the latter years of this decade is for the boom to be followed not by the proverbial bust, but rather by a return to moderate rates of growth. The soft landing. The sweet spot.
Already, most of the big economic indicators are pointing in this direction. Growth in Alberta's annual retail sales last year was around 15 per cent. Now it's around 8 per cent - still almost double the national average, but down nonetheless. The unemployment rate has swelled from 3.1 per cent to 3.8 per cent. Interprovincial migration is still positive, but in the first quarter of 2007, there was an actual net outflow of people back to Saskatchewan.
If Alberta can avoid a big bust this time around, it will be because the world is a different place. It won't be because the provincial economy is much more diversified, or because we've all been prudent savers and cautious spenders. Neither is true. It will only be the result of good fortune, good timing and the fact that world oil prices are likely to remain strong.
Albertans will be thankful if they are spared the misery of a bust. But they should keep their fingers crossed and credit cards paid off, just in case.