Energy

William Watson has taken a thoughtful look at a recent AIMS paper on equalization and offers his positive comments in a National Post column. In addition to being a regular columnist at the Post, Watson is the editor of Policy Options, the magazine of the Institute for Research on Public Policy, and a professor of economics at McGill University. In his article, Watson explores each of Boessenkool's arguments in favour of excluding nonrenewable natural resource revenues from the equalization formula. Watson is the latest in a series of national writers to enter the debate that has been sparked by "Taking off the Shackles: Equalization and the Development of Nonrenewable Resources in Atlantic Canada", by Ken Boessenkool.

In endorsing the conclusions of a recent AIMS paper on equalization, a Calgary Herald editorial stated that Albertans know intuitively that "windfall" oil revenues should be used to retire debt, shore up savings or spent on one-time projects, not for regular program spending. In Taking off the Shackles: Equalization and the Development of Nonrenewable Resourses in Atlantic Canada, Ken Boessenkool argued that royalties should not be considered part of a regular income stream and should be excluded from the equalization formula. The Calgary Herald has agreed. It states: "…the transfer calculations should be made on the long-term, stable sources of provincial revenue - such as corporate profits, personal income and sales taxes - not volatile royalty revenues. "