Why Calgary’s mayor says spending billions on infrastructure is more crucial than ever given economic woes
via CBC News By Scott Dippel
‘Many would argue that the building of the convention centre … is actually by pure luck perfect timing’
Calgary’s mayor has been saying for the past couple of months that his city has been hit harder than any other metropolis in Canada.
Its people have been coping with a pandemic, the economic fallout of COVID-19 and a global oil price crash, due to a spat between OPEC and Russia.
But Naheed Nenshi insists the city must push ahead with the core of its economic strategies. That includes getting on with building the Green Line LRT project and spending more than $1 billion on various major projects in the years ahead — such as the entertainment district in Victoria Park.
CBC News asked the mayor about his plans to stay the course, even if those plans run counter to common sentiments.
Calgary catches up
Q: There are people in Calgary today saying we can’t afford to spend billions on city projects like the Green Line, BMO Centre expansion, a new arena, a new field house, Arts Commons expansion, etc. They’re not all saying we’ll never build such things, but that we need to pause for now until we know more about our finances going forward. How do you respond to that?
A: I take a different point of view. In cases like this, the evidence has shown that we’re all Keynesians in a situation like this. In other words, when interest rates are extraordinarily low — that money is essentially zero per cent right now — and you’ve got huge unemployment problems and people need to get to work, this is actually the very best time to build infrastructure. You know, for many decades in Calgary we played the cycle the other way. So we didn’t build infrastructure during bad times, exacerbating the unemployment, and then when we went to build in good times, it was really expensive and we were competing with the private sector for that labour.
So in my mind, a project like the Green Line, which is estimated to create 20,000 jobs, this is exactly the moment that you want to be investing that way, and the bonus here is: you’re actually building stuff we need. You know, pure Keynesian economists will say it actually doesn’t matter what you build. You could dig holes and fill them in again. It’s just about getting money into the economy. I take a different view which is: we have a giant infrastructure deficit in the city and this is our opportunity in times where prices are low and people need work.
Q: But that also carries with it an assumption that the Calgary level of growth that we’ve seen in let’s say the last 50 years is going to continue. What if the scenario changes, that either Calgary grow