Who Really Benefits? The Hidden Costs of Federal Equalization Payments

"An imbalance between rich and poor is the oldest and most fatal ailment of all republics." ~ Plutarch

"The worst form of inequality is to try to make unequal things equal." ~ Aristotle

"Some people continue to defend trickle-down theories which assume that economic growth, encouraged well-organized inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naive trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system." ~ Pope Francis

"Only a well-organized movement of young people, educators, workers, parents, religious groups and other concerned citizens will be capable of changing the power relations and vast economic inequalities that have generated what has become a country in which it is almost impossible to recognize the ideals of a real democracy." ~ Henry Giroux

Economic power doesn't spread itself. It's seized, it's concentrated, and it's controlled by the people who understand the game. You live in Alberta, a land of much wealth, a province that lights the nation. And yet, with billions flowing from your earth, you watch your wealth robbed from you, redistributed to others who take but never give back. This is the heart of Canada's equalization payments, a scheme that claims to be equitable but holds your province economically bound.

You work, you create, and your economy grows. Alberta is a "have" province, a title that is meant to sound victorious but is really a badge of bane. The federal government does not send you equalization payments. Instead, you invest, contributing more to the federation than you ever see returned. Meanwhile, eastern—East of Ontario provinces skim their share while slowing your success, blocking pipelines, refusing resource development, and profiting from your industry anyway. The imbalance is not by accident, it is by design.

Since 1957, it has cost Alberta taxpayers approximately $67 billion into the federal Equalization program.

In a world of power, incentives motivate behaviour. The equalization system removes the incentive for economic growth in recipient provinces. Why push for resource development when the wealth of others will sustain you? Quebec, the Maritimes, these provinces grow comfortable with federal support, never feeling the pressure to exploit their own resources as Alberta must. The result is a permanent underclass of provinces dependent on the wealth of a few, a cycle that is never broken.

In fact, the people of Alberta contribute around $3 billion annually into the federal Equalization program, taxes paid in Alberta are the highest in the country.

You understand struggle. Alberta's economy is resource-based, an as-cyclical-as-the-tides business. Business cycle booms and busts are inevitable, but even at your worst, the payments don't stop. When oil crashes, when unemployment increases, when businesses fail, you still pay. No lifeline is thrown to you. Instead, you sit back and watch your money subsidize services in other provinces while you suffer cuts and austerity. Your pain is ignored because, in this system, your pain doesn't matter; your money does.

The game is rigged economically. Your money isn't only taken, it actively hinders your ability to earn more. Carbon pricing, pipeline bans, emissions ceilings, each is yet another economic yoke to your industry, yet another vehicle for stifling your province's growth while ensuring the bread remains on the street. You're rewarded for prospering, but kept in place as others are spoiled. Power isn't interested in fairness; power is interested in control.

This creates resentment, and rightly so. You watch your taxes being used to fund public services somewhere else in the nation while your own provincial social safety net cuts jobs. You watch your industry demonized while its profits are bled to subsidize the status quo elsewhere. The political divide widens, and Alberta's patience wears thin. Whispers of separatism turn to cries for action. The US President's—Trump administration pushing for the 51st state seems appetizing for most of the population in Alberta. A province cannot be asked to offer sacrifice without reciprocation eternally.

And as you give, Alberta's financial troubles mount. Your province goes into debt, but the system doesn't mind. Equalization doesn't concern itself with your bad times, but only your good times. You're expected to bear the burden for eternity, and recipient provinces are insulated from having to deal with their own economies. It's a perpetual game of economic disparity, a system designed to have you give and give and never receive.

This is not how power is meant to function. A system that punishes success and rewards stagnation is guaranteed to collapse under its own gravity. The question is, will you continue to play along? Will Alberta continue to subsidize a system that returns nothing? Or will it stand up, call for reform, and assert its rightful place, not as a vassal to the federation, but as an equal partner?