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A pumpjack surrounded by a canola field draws oil from the ground near Cremona, Alta., on July 12, 2021.Jeff McIntosh/The Canadian Press

As Alberta’s Finance Minister released data on the province’s trove of surplus dollars this week, Jason Nixon said the Premier’s departure and the corresponding United Conservative Party leadership race isn’t affecting government operations. As much as the UCP will insist this in the months ahead, it’s not true.

No one knows who will win the leadership contest, become premier and shape the UCP government this October. The policy gulf between candidates Leela Aheer and Danielle Smith is vast. Government actions into the fall are limited by that uncertainty.

First of all, Mr. Nixon himself is only in the role of finance because his predecessor, Travis Toews, has resigned to run for the UCP leadership. He and other cabinet ministers have been given the task of trying to keep the government boat steady while Jason Kenney plots a graceful exit from public office. This leadership limbo exists even while there are also serious policy issues to deal with. For instance, teachers are still asking how a controversial new elementary school curriculum will land this fall. It was rushed and forced by many accounts, in a process that has shaken many parents’ faith in the provincial government. Will any of the UCP candidates reverse or pause this?

More broadly, does an Alberta sovereignty and autonomy-focused candidate such as Ms. Smith or Brian Jean take the race, or is it one of the other candidates likely to have a more conciliatory relationship with Ottawa? Mr. Nixon took the UCP middle ground this week, saying it was possible to walk and chew gum, and defend the province against an “overreaching” federal government, “but at the same time we have to send a strong message to the world that Alberta is a stable place to invest.”

Of course, a lot of the debate should centre around the economy and the stunning reversal of Alberta fortunes, based largely on high oil demand. The update from the province on the end of fiscal year 2021-2022 showed a $3.9-billion surplus, compared to the $18.2-billion shortfall it predicted when it released the budget in February, 2021. As the Premier often emphasizes in his social media posts, employment in the province is growing and people are moving here again.

But now come the pressures on government to spend. Public sector unions will factor this into every upcoming negotiation. High-profile economists such as Trevor Tombe ask whether monthly payments from the province could eliminate the disproportionate hit to lower-income families of ultra-high inflation. The NDP is asking the government to freeze postsecondary tuition. There will be pressure for a generational investment in highways, schools, trains, carbon capture and other infrastructure. Leadership candidates have yet to lay out, in any detail, how they would handle these questions.

And the hesitancy for the Alberta government to act extends far beyond provincial politics, and to the very real potential of sky-high inflation bringing about global recession. Despite the riches sloshing into Alberta right now, there’s no sense that we’re existing in any kind of slaphappy, golden boomtime period again.

There are investment questions given the global focus on climate. But any political leader – whether NDP or UCP – knows that inflation is a massive, immediate risk to the province that lives by the sword and dies by the sword, of energy revenues.

Even as Alberta rakes in the revenues from high oil and natural gas prices, those high prices are destabilizing for the global economy, in the extreme. Two years ago, the province was facing negative energy prices and fending off creditors. Two years from now – or even in a shorter time span – the province could face new, worrying economic risks prompted by the overheated global economy. High energy prices, which result in higher prices for everything, could swamp the global economic recovery out of the pandemic. There are many signs this is already happening.

In a nod to Albertans’ desire for longer-term planning and greater stability from their government, the Finance Minister did tout tackling the province’s $95-billion debt and legislation the government plans this fall to increase the payments that will be made into the province’s rainy day kitty – the Heritage Savings Trust Fund.

“The fact is, what goes up will come down,” Mr. Nixon said.

This is the blessing and the curse of oil and natural gas resources. That plays out in the province’s politics as well. Mr. Kenney is leaving not only because of his own political missteps and the push of extreme elements in his party, but also because the Alberta economy – and therefore its politics – has a churn that is unlike any other province.

University of Alberta political scientist Jared Wesley tweeted this week about his work on this issue. Since Ralph Klein left office about 15 years ago, there have been six premiers. Only Ed Stelmach and Rachel Notley have served around four years.

As great as windfalls of money are, they knock things off course. Early in the UCP mandate, Mr. Toews spoke of having a panel examine the province’s revenue streams – and whether the province should consider more steady sources, such as a PST – before the provincial election next year.

Mr. Nixon made clear this week that any examination of the province’s revenues is not a priority. From my point of view, it’s likely slated for Nevuary.

But even if there weren’t a leadership race on, and Mr. Toews was still the finance minister, this would likely be the case. Such is Alberta.

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