Saturday, February 19, 2011

Alberta's shoddy echonomics.

The one great thing that Conservative Governments fail at consistently and constantly is stability.  Their Government is always surrounded by chaos!

In the 90s the Alberta Conservatives accounting practices moved business out of the province rather than into it.  The "New Up-grader" seems to be one of these scams on a newer, grander scale.

Point in detail.  A company in Calgary built it's business on heat exchangers.  He was a customer of mine for several years.  I called him up one day and got a recorded announcement the shop was closed and if one had a project to call the number given.

I was able to contact the owner finally; in Minneapolis!  He explained in detail why he closed his shop of 150 employees and opened up again in the US.

The tale:
Over the years he had built a business in the oil patch and the tar sands.  His complaint however was the business structure.  When the economy was down like it is now, or there was a looming election like there is now, the Tar Sands companies would put out bids on expansion projects.

The announcement would create a ripple effect in the economy as bids were sent out for various components of the phantom expansion.  Companies, like my customer spent a lot of coin working the speculation trail pumping out research and quotes on phantom projects.

Meanwhile, his shop sat idle.  To keep his shop busy he took on projects in Minneapolis building heat exchangers for air conditioning units.  It too built into a nice business for him but the costs of shipping the air conditioners to the States was overhead he could not afford.  The Air Conditioner business far outreached the output of the northern heat exchanger business.

He told me "If Alberta wants me to quote on something they can write to my Air Conditioning shop in Minneapolis.  I refuse to keep a shop staff of more than 100 people on payroll while the Government fleeces my pocket with phony quotations.  The same "new projects" are quoted every time the economy takes a dip.

His shop now closed and his business fully established in Minneapolis he remains a common tale of Conservative mis-management.

This brings me to the next post, on the "New Up-grader"

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