Many Albertans remember the iconic image of former premier Ralph Klein holding up the “Paid in Full” sign to symbolize a debt-free Alberta government.

“I’m very, very proud to announce that Alberta has slain its debt,” the late premier told a cheering crowd on July 12, 2004.

“We can go home to our kids and our grandkids and say, 'We have protected your future so you will not be carrying the burdens of the past,’” proclaimed Pat Nelson, then-Alberta finance minister.

Fast forward a decade and a half and Alberta is now sadly among the ranks of the indebted.

On Jan. 19, 2020, Alberta’s government debt officially passed the $70-billion mark. That means every man, women and child in Wild Rose Country now owe more than $16,000 in provincial government debt.

So how did we get here?

During the boom years Alberta’s politicians spent like oil-barons without a care in the world.

And when the oil price dipped down, the spending continued to climb higher and higher. The spending has got so out of hand that even former Saskatchewan New Democrat finance minister Janice MacKinnon called out the Alberta government for having a “spending problem.”

More than a decade of overspending has led to a predictable result: a provincial debt tab that has increased by more than 200 per cent, faster than any other province since 2007.

Things are bad now, but without tough decisions things will get worse.

Economist Trevor Tombe provided a sobering warning in his 2018 University of Calgary report. The provincial government’s net-debt-to-GDP ratio could climb higher than any point in Alberta’s history, including the Great Depression when Alberta partially defaulted, by the early 2030s.  A century later and our debt problem could be worse than they were when Albertans’ crops were withering in the sun and dust clouds filled the air.   

To put out this debt fire before it burns its way through more taxpayers’ dollars, Alberta Premier Jason Kenney needs to take a page from Klein. Afterall, Klein was able to pull Alberta out of a similar situation to the one our province faces today.

“When he walked in the front door of the legislature in that horrible winter of 1992, the finances of the province were in just horrible shape,” recalled Rod Love, Klein’s chief of staff.

In 1992, Alberta had the highest deficit per capita in the country. In Klein’s first full year as premier, debt interest costs alone were equivalent to one-third of the health budget or three-quarters of spending on social services.

The government was able to address its financial challenges because of Alberta’s willingness to “face problems head-on and pioneer new ways of responding to them,” said Klein.

Klein indeed faced the problem head-on and promised to balance the budget within three years and legislated a target to eliminate the government’s debt within 25 years. He beat both targets.

To accomplish this feat, spending was cut in all ministries, including education and health, government employment was reduced, government wage cuts were necessary and Klein tried to get politicians and bureaucrats “out of the business of business.”

“Ralph felt those cuts and knew they had an impact on people’s lives and it tugged away at his gut. But in the end, he knew it was the right thing to do,” recalled Jim Dinning, Alberta’s finance minister from 1992 to 1997.

Klein’s decisions were tough. But they helped create opportunities for families from all corners of the country. With a booming economy, no debt and no sales tax, Alberta was transformed into the “envy of the nation.”

With a provincial government debt tab currently over $70 billion, we're heavy in the red, but we can fix it. It's time to start thinking past the next balanced budget and start planning our comeback to a debt-free Alberta.

This column was originally published in the Calgary Herald on Feb.1 2020.