EDMONTON - For Premier Ed Stelmach, 2010 has been -- to borrow a term used by the Queen in 1992 -- an "annus horribilis."

For the Queen, 1992 was a horrible year because of her children's divorces and a fire that gutted Windsor Castle.

For Stelmach, 2010 has been a horror politically because it was a year when three of his MLA's divorced the Conservative caucus and one of then, Raj Sherman, set fire to the government's credibility over health care.

Then there was a provincial budget with a projected record deficit of $5 billion, another duck disaster in oilsands tailings ponds and continued public opinion polls showing the veteran 39-year-old government in a virtual tie with the still-in-training-wheels Wildrose Alliance.

Stelmach is watching with relief as 2010 fades into the distance in the rear-view mirror. Not that he admitted to having such feelings in his year-end interview with The Journal on Monday.

"Year-endears" with politicians are a tradition as old as the boilers in the legislature basement and as artificial as the Christmas tree in the legislature rotunda.

It is, after all, impossible to stuff 12 months' worth of events into a 30-minute interview sack. It is not a fair expectation for either reporters or politicians. But we try.

Stelmach downplayed the problems of the past year and looked ahead to better times in 2011, particularly to boosting the number of jobs for Albertans: "The economic numbers are quite positive. I think today's numbers are 35,000 less people on EI (employment insurance) compared to last October, so that's positive. But Job 1 is creating more jobs for Albertans."

The numbers might be quite positive on job creation, but they're not so great on deficit reduction.

In fact, they're so bad that Stelmach is backing away from his promise to have the province balance the budget by the end of the 2012-13 fiscal year. The government's mantra of "Back in the black" has apparently become "Debt's still a threat."

Stelmach now says "we will definitely show a trend toward balancing" the budget by the 2012 fiscal year. "Will it be absolutely balanced? I can tell you if there is no recovery on the revenue side we'll be very close to balancing."

In other words, without a jump in resource prices the government is on track to run a record deficit this year and things aren't going to get better next year. Even if the economy improves, government revenue will lag behind by a year or so.

This is not good news for the government. For the opposition parties, though, a record deficit is a Christmas present that keeps on giving. If the 2010 crisis in emergency room care has undermined public confidence in how the government manages the whole health care system, chronic deficits will undermine public confidence in how the government manages its finances.

To counteract the opposition attacks, the government will -- as Stelmach demonstrated on Monday -- focus on how the deficit is not really a bad thing because it's a result of good-news spending on infrastructure projects such as building schools. And expect to hear the argument that the deficit isn't really a deficit at all: the government has enough money in its savings account -- the sustainability fund -- to cover this year's record deficit and still have $8 billion in the bank. But at the current rate, without a significant boost in government revenue or cuts to spending, that savings account will be drained dry in two more fiscal years.

If so, Stelmach's political fortunes will be just as empty. The conventional wisdom is that Stelmach won't even be premier by the end of 2013. It's expected he'll lead the party into the next election (which he pretty much insists will be the spring of 2012) and then step down a year or so later.

That's the good news scenario for him, one where he wins another decent majority government.

The bad news scenario for him is he loses the next election or gets a slim enough majority that those already gunning for his job will force him out early. Make no mistake, the tire kickers, as Ralph Klein called his successors, are out there. They're just not kicking very hard. At least not yet.

Stelmach is master of his own destiny as long as he is master of the public opinion polls and master of public confidence in his government. Right now, he is neither.

Interestingly, Stelmach didn't appear particularly troubled in the year-end interview. Yet again, as he does regularly in intimate interviews with journalists, he was relaxed, confident and funny -- not at all like the public version of Stelmach who is as stiff and wooden as a toboggan -- and on the same trajectory.

At least that was the trajectory for the past year. Stelmach supporters believe the worst is over, that the party (and Stelmach) has bottomed out in public opinion polls and there's nowhere to go but up.

We shall see.

Stelmach has proven his detractors wrong before. He has a year and a bit to prepare the groundwork to prove them wrong again.

As head of a 67-seat majority government with a multimillion dollar election war chest, he likely has a good chance -- as long as 2011 doesn't prove to be another annus horribilis.

gthomson@edmontonjournal.com