Oh Yeah. The Budget. We Almost Forgot.

December 3, 2012

Largely lost this week in the most recent mayoral tumult was the release of city staff’s recommended 2013 operating and capital budgets. lostintheshuffleIs there a better manifestation of how the mayor’s ongoing circus sideshow stifles political discussions on any important issue? And no, that is a rhetorical question. This is the inevitable result of electing a maverick candidate with a sketchy history both personally and politically to office.

What also shouldn’t be surprising, given such a tenuous grasp on his job, is how little of an impact Mayor Ford seems to have had on the 2013 budgets. Overall gross expenditure is up, albeit modestly. There’s a slight property tax increase with no sign of any sort of rollback on an item like the Land Transfer Tax. The mayor’s biggest contribution so far seems to be in getting his budget chief, Councillor Mike Del Grande, put on the Toronto Police Services board in order to try and cut away of its numbers.

Which is a necessity this year since balancing the city’s operating budget hinges currently on a $21 million reduction in the police budget. That road already seems somewhat rocky with news that the police union is threatening legal action if budget cuts result in any layoffs. Administrations with much stronger support have difficulty facing off against the TPS. It’s hard to see how such a rudderless one can.

There are, though, Fordian echoes of budgets past in the 2013 documents. woundedpreyThe 0%, across the board freeze edict to all departments acts most certainly as a de facto cut since any sort of inflationary increase will result in less available money this year. And to be sure, there are some notable outright cuts. Staff reductions at Fire Services and a cut to the TCHC subsidy. There’s an increasing reliance on user fees, $30 million in all including the TTC fare hike.

Budget 2013 also maintains the far-right fiscal view Mayor Ford possesses of financing governance mainly through reduction. That is, cutting your way to smaller government. The only real revenue growth to this way of thinking can come through user fees. You want it? You pay for it unless of course we’re talking about road ways as public space.

Like the Ford administration, the city budget abhors debt. Despite the infrastructure needs the city faces, the 2013 budget is driven to reduce the cost of debt Toronto pays out as if somehow this is a fiscally irresponsible course of action only the most desperate or financially dissolute would take. Manageable debt? Never heard of it.

The argument goes something like this: (from the pie chart on page 27 of the Operating Budget) Imagine the services and programs we could save if we eliminated the $415.4 million in debt charges we’ll be racking up next year. Pay down some of that backlog of much needed TCHC repairs. Hire more fire fighters and EMS workers not fewer. Eliminate forever that damned Emerald Ash Boer.

No debt, no problems.

The idea’s so fucking crazy it just might not work.

Because if we don’t take on debt, how are we supposed to deal with all the massive capital costs to build and buy the things we need or to keep the things we already have in a state of good repair? goodebtbadebtEven if we eliminated the hundreds of millions of dollars we spend to service the debt by, well, eliminating the debt we’ve taken on, it’s not enough to cover capital costs. This administration would have you believe a combination of two things. Savings and efficiencies and lowering our expectations will put us over the top, folks. Easy peasy. It’s amazing no one else has ever thought of it before.

The fact is, Toronto’s debt load is not onerous. Despite a recent uptick in capital expenditures owing to TTC expansion, population growth and just old, creaking infrastructure, the city will only nose up close to its arbitrary, self-imposed 15% of property tax levy debt ceiling in around 2017 before heading back down. With rates of borrowing currently at a historic low and no big spikes foreseeable in the near future, why the debt reduction fixation? texaschainsawmassacreIt only sounds fiscally sound.

And that pretty much sums up Team Ford’s approach to governance. The appearance of fiscal prudence while in reality little more than a ruinous attack on healthy city building. If increasing revenues and taking on debt are both ruled out of order, what other options are available? It’s elimination through the process of elimination.

Despite our focus elsewhere on the mayor’s shortcomings, this is the one that’s hurting us most.

discountingly submitted by Cityslikr