The Tory Story

October 23, 2014

It has come to my attention from a couple trusted sources that maybe, just maybe, I’ve been irrationally hostile to the whole concept of John Tory for Mayor. irrationalSo blind I am to the possibility that a Tory mayoralty wouldn’t be all that bad that my pushback is too over the top, aggressive, emphatic and resolute in rejecting the positives. Missing the forest for the trees, and all that. Come on. Really? Mayor Doug Ford?

It’s a fair accusation to make. In style and appearance, in putting our best face forward, yes, John Tory is no Rob or Doug Ford. After 4 years of regular embarrassment and some 1500 days or so of What The Fuckiness?, electing John Tory would announce for all that world to see that Toronto is once more back to taking itself seriously. The man walks upright. He speaks as if he might actually be thinking about what he’s saying. His suit fits.

I even over-stepped the other day, demanding someone name a significant policy difference between John Tory’s platform and that of his rival, Doug Ford. There is one very noteworthy distinction in terms of policy between the two men. The Land Transfer Tax. Ford thinks it can be gradually done away with, no problem. deepbreath1Never mind the $300 million annual revenue it brings in. Done and done.

Full marks to John Tory. This week he stood before a very anti-LTT, real estate crowd and told them he wasn’t going to tell them what they wanted to hear. The city needs the revenue from the LTT. The LTT has not hindered home sales. The LTT would remain in place if John Tory was elected mayor.

But after that? In all honesty? I strain to come up with much daylight at all between John Tory and Doug Ford when it comes to stuff of substance. (And enlighten me, fill up the comments section of where I’m wrong in this.) John Tory does better copy than Doug Ford. He sounds better telling us he cares about things. Tory’s made a lifetime of personal dedication in the private sector to a multitude of causes throughout the city. His awards and accolades have been earned not purchased.

This isn’t, however, about merit badges for volunteer service. texaschainsawmassacreThis is about politics and policy, about ideas to enhance the lives of every resident in this city, about delivering opportunity to everyone regardless of where they live or work. This is about standing up and giving an honest assessment about where the city is now and how it needs to proceed forward.

As a candidate, John Tory has failed miserably on that account.

Like Doug Ford, John Tory sees Toronto having a spending problem not a revenue problem. Despite advice to the contrary from the city CEO, Joe Pennachetti, or counter-evidence from municipal governance experts like Enid Slack, Tory insists we just need to tighten our belts, root out all those ‘inefficiencies’ at City Hall and we’ll have all the money we need. Tory is on record saying “low tax increases, at or below inflation, impose spending discipline on governments.”makeitupasyougoalon

Actually, low property tax increases, at or below the rate of inflation, impose service and programs cuts or hikes in user fees. At best, they ensure no expansion of those service or programs. It’s a self-induced zero sum game where we have to unnecessarily choose between our priorities. A game we’ve been playing for the last 4 years during the Ford administration.

John Tory is offering nothing different.

His SmartTrack transit plan is only slightly less implausible than the Subways! Subways! Subways! mantra of the Fords, and that’s a mighty low bar to clear. SmartTrack is full of questionable construction details and a financing gimmick that is untested anywhere in the world at the level he’s pitching. His assurances that he will get it done by sheer force of will are as empty and meaningless as the Fords’ guarantee about building subways.handthekeyback

The endorsements now flooding in for John Tory from most of our mainstream newspapers and media want us to believe that we’d be voting for CivicAction John Tory, John Tory the magnanimous private sector benefactor. There’s little mention of Tory’s political track record. Not so much his career as a Progressive Conservative operative and elected official, but his time spent as a well-placed backroom figure in the post-amalgamated Toronto Mel Lastman administration.

Ahhh, Mel Lastman. Only slightly less eye-rollingly embarrassing in light of Rob Ford. Still. Who the hell’s the WHO? African cannibals. MFP. The Sheppard subway. 1st term guaranteed property tax freeze, and here we are. John Tory was close to all of that. In 2003, he wanted us to ignore that. We didn’t. In 2014, we seem ready to let by-gones be by-gones.

What’s changed? Rob and Doug Ford, you’ll tell us. Rob and Doug Ford.

If the endorsements are any indication, what we want as a city is just a little bit of peace and quiet, a break from all the rancour and partisan divide that’s ground the city to a halt over the past 4 years. The only candidate who can do that, it seems, is John Tory, our great white establishment hope. sternheadmasterToronto needs a nice big fatherly hug. We need some civic soothing.

Frankly, that’s like applying make up to cover the bruising we’ve taken from the Ford administration – an administration John Tory supported until it became untenable to do so. Let’s all pretend like it didn’t happen, like Rob and Doug Ford were mere anomalies, sprung out of nowhere for no reason whatsoever. That they didn’t represent actual grievances and political, social isolation that existed well before they cynically tapped into for their own hubristic political gain.

In his article yesterday on what a possible John Tory mayoralty might look like, Edward Keenan suggested that Tory’s ‘laudable charitable work’ could be seen not so much as attempts to change a system that doesn’t include everyone but “helping people network their way into the system.” captainstubingLadies? Take up golf, am I right?

John Tory isn’t a candidate for change. His campaign has been pretty much Steady As She Goes, Only Quieter and Less Scandal-filled. More Captain Stubing than Francesco Schettino. Everything’ll be fine once we get rid of the Fords.

The funny thing is, at the council level races, the push for change is popping up all over the place. There are exciting candidates throughout much of the city. In Ward 2 alone, the Ford petty fiefdom, I estimate 3 strong candidates challenging Rob Ford, one of whom, Andray Domise, is knocking on the door of knocking off the mayor. If that comes to pass, it would be a more significant result than whatever happens in the mayor’s race.

John Tory is yesterday’s man. He represents the values of the old status quo. knowaguyA top down leadership paradigm based almost entirely on who you know, connecting inward not outward.

The John Tory campaign message has little to do with where we want to go as a city. It’s all about re-establishing order. Order under the (fingers crossed!) beneficent gaze of he who knows some people. He’ll make a couple phone calls, get some stuff done. Just keep your voices down, if you don’t mind. It’s been very loud around here for too long.

— cathartically submitted by Cityslikr


Shorter City Manager Annual Address

May 14, 2014

goodshape

Everything’s fine. Everything’s under control despite the assault on reasoned municipal governance endured by the city of Toronto over the past 4 years.

Storm clouds on the horizon?

Queen’s Park and Ottawa have to get more seriously involved in both the transit and housing files. The province needs to return to the table with its share of half the TTC’s annual operating budget. The feds, well. No country in the developed world is missing any sort of national participation in social housing (not to mention public transit) except this one. Cities should not, cannot be expected to foot the lion’s share of funding to provide affordable housing for its residents. Without serious partners on this, City Manager Joe Pennachetti suggests, sooner rather than later, we will be forced to start closing down housing because there will be no way to keep all of it safe and inhabitable. He calls this the “smoking gun”, threatening Toronto’s fiscal sustainability.

stormclouds

Local politicians also need to wean themselves off such a heavy dependence on the property tax base as a source of revenue. No, no, no. This doesn’t mean keeping them low. Our residential property tax rate remains the lowest in the entire GTA. We have to diversify, tap into other ways of paying for things. The city manager is partial to a local sales, income or corporate tax. Discuss amongst yourselves but we need to stop pretending that Toronto doesn’t have a revenue problem. It was a catchy phrase that was the complete opposite of the truth.

The city manager’s 3rd annual address to the Institute on Municipal Finance and Governance was pretty much a repeat performance. Nothing entirely new or surprising. If only more of our elected officials (and electoral hopefuls) were listening.

bearsrepeating

repeatedly submitted by Cityslikr


The Kids Are Alright

January 22, 2013

Next time you get all hot under the collar at what you perceive to be shenanigans, childish antics or just a general sense of out-of-control behaviour by our municipal politicians, you really need to take a deep breath and a long look at André Côté’s Institute on Municipal Finance and Governance report, kidsarealrightThe Fault Lines at City Hall: Reflection on Toronto’s Local Government. Given the constraints and competing interests at work, it’s really remarkable anything gets done at all. And despite what you might be hearing around Toronto these days, quite a bit gets done, starting with ten billion dollars or so worth of operating and capital budgets just approved last week.

Could things run more smoothly? Of course they could. That’s true at both Queen’s Park and Parliament Hill as well. Probably every place of government the world over.

Two points in Mr. Côté’s report jumped out at me as legitimate causes of both the institutional as well as current struggles politicians face at City Hall. One is entirely external and, as it stands now, almost entirely out of our local politicians’ hands. The second is very specific to our present situation.

Another factor that clouds political accountability at City Hall is the degree of provincial control over municipal affairs. The Province sets election dates and service standards, limits the use of taxes, requires approval for certain asset sales, and uses conditional funding arrangements to force compliance in important policy areas. The result is that the City’s field of action is constrained. The reliance on fiscal transfers also breaches a basic principle of public finance: accountability is blurred when the level of government making the spending decisions is different from the one that raises the revenues.” [page 5]

Everything municipal governments do in this province can be undone or undermined by their provincial overlords. We are their ‘creatures’, according to a 19th-century document written when this was an agrarian country and not properly challenged in nearly 150 years. eviloverlordUltimate accountability lies almost exclusively in the hands of politicians not necessarily elected to mind municipal level issues. In most cases, we should refer to them as absentee landlords.

Take Toronto, for example. (Please, the rest of the province chimes in.)

Against our collective will, we six municipalities, were messily forced into one by an antagonistic Queen’s Park government. ‘Efficientized’ to use Lucas Costello’s term; a lean, mean level of government meant to shed its fat and reap a certain windfall of streamlined bounty. Never mind that none of that happened because it was never intended to in the first place. It was all part of a downloading scheme almost entirely for the purpose of lightening the fiscal load on the provincial coffers.

Toronto was never given the appropriate powers commensurate with the much larger entity it had become. In fact, it was stripped of a level of governing that oversaw some of the more contentious, citywide services like policing and transit. Gone was Metro council, leaving only one politician at City Hall representing the interests of the city as a whole. The mayor.

Now figures as disparate as academic Richard Florida and councillor-brother Doug Ford have publicly mused about countering this problem by instituting a stronger mayoral system like they have in the U.S. Frankly, I find that notion to be a fucking nightmare scenario. strongmayorAll well and good if you like the policies and directions of a Mayors Bloomberg or Miller or Ford but what if you don’t?

Let me run a hypothetical by you that we can all be appalled at.

A Mayor Giorgio Mammoliti in a strong mayor system?

One might argue if we had such a thing, we’d be more careful with who we elect mayor. And if we aren’t?

My suggestion is rather than seek to beef up our municipal governance by bestowing more power upon one person, we look to increase it for the 2.6 million residents who live here. How? Well, that’s another post entirely and probably by someone with much stronger public policy credentials than I possess. (Paging John McGrath. Call me!)

This does take us the second important point brought up by Andre Côté in his report.

Reformers should also bear in mind that, under the existing system, Mayors Rob Ford and David Miller have had notable successes in advancing their policy agendas. Both academic literature and recent history suggest that a combination of public profile, political acuity, and a willingness to use the softer skills of persuasion and consensus-building can result in successful and effective lead­ership at City Hall, even without a strong mayor system.” [page 7]

Pre-amalgamation, mayors in their respective cities had fewer councillor cats to herd and the issues were largely more specifically localized. liontaming(Many that weren’t were dealt with at the Metro level.) So they didn’t need more powers to push their agenda or items forward.

Such is not the case in post-amalgamation Toronto. Yet both Mel Lastman and David Miller managed for most of their terms in office to get `er done. Rob Ford too in his first year or so as mayor. Then he didn’t. Ultimately, he has no one else to blame but himself for that.

That’s not quite right.

We the voters are to blame as well because a plurality of us voted for a candidate who possessed few of the traits necessary to be an effective mayor in Toronto. ‘Political acuity’? As a campaigner perhaps but certainly not as mayor. ‘…a willingness to use the softer skills of persuasion and consensus-building…’. Never ever during his time at City Hall did Rob Ford display that particular trait. In fact, he revelled in being the exact opposite, the outsider, the lone wolf.

We elected him mayor despite all that and somehow seemed surprised how badly it’s all worked out.

A perfect mayor (if such a thing existed) will in no way paper over all the problematic governance realities this city faces. hogtheballIt would be foolhardy to think otherwise. But we shoot ourselves in the foot, and vote against our best interests when we throw our support behind a candidate based on a platform of sticking it to others at City Hall. Such an us-versus-them approach is destined to failure, not only for the candidate in question but the entire city as everything becomes a grind not a collaborative effort.

The city doesn’t have the power it needs but it has to stop squandering the power it does have. That starts with electing a mayor who is able to see past their own narrow focus and reach out to interests that are not their own.

co-operatively submitted by Cityslikr


The Big Freeze

August 20, 2012

Good news, Toronto!

Looks like the city’s not going to face a what-the-hell-let’s-just-go-for-a 10% cut across the board in fiscal year 2013. Nope. Things are looking up. We’re just going to have to deal with a 0% budget freeze. So already put upon departments, services and programs will merely grind to a further halt through attrition and more sprung leaks rather than amputations and major blood loss.

Along with a spending freeze, the Globe and Mail reports that city manager Joe Pennachetti has also called for ‘a ban on new service initiatives’. So, it’s all stand pat and hope for the best. We just can’t be too sure how big our surplus is going to be next year.

It’s difficult to keep your head above fiscal choppy waters when you insist on swimming with only one arm. Mayor Ford’s proposed 1.75% property tax increase barely covers the rate of inflation, never mind any of the wage settlements various city workers are scheduled to receive. Instead of exploring other sources to generate more revenue, it’s all about further reducing services until…

Well, that’s the $123 billion infrastructure deficit question.

You see, fiscal conservatives on council will tell you that we need to reduce the $400+ million spent annually on paying down our debt principle and interest. When we get rid of that, well then, the sky’s the limit. We can start dishing out for all those nice-to-haves everybody loves so much but doesn’t really want to pay for.

Like a properly operating public transit system. Serviceable roads. Bridges that don’t fall down in chunks. Libraries with computers and books other than trade paperbacks.

Until such time when this city is debt free, we’ll all have to just get by. Make do with less. Show the kind of discipline the likes of Councillor Denzil Minnan-Wong is so proud of when he votes to cut everything Mayor Ford says needs to be cut.

Discipline and courage.

“I am doing this for everybody’s future,” fiscal warrior and city budget chief, Mike Del Grande proclaimed. “Unfortunately, they want me to be the bad guy.”

No, that’s not true, councillor. What we really want you to be is a better budget chief. One who realizes that miserly penny-pinching and refusing to have a sensible discussion about the true costs of maintaining a healthy city now doesn’t in the least leave a prosperous future for the coming generations. It just leaves a mess that they have to clean up and you don’t have to pay for.

In reality, it’s kind of the exact opposite of courage and discipline.

I don’t know how much latitude senior bureaucrats like Mr. Pennachetti have with the elected official they deal with. Certainly the fate of Gary Webster must serve as a cautionary tale about dealing with the Ford administration. But this budget freeze/no new service initiatives mode he’s adopted for the upcoming year is at odds with the city manager I saw speak at the Institute on Municipal Finance and Governance this spring about Toronto’s fiscal health. He boasted about our double-A credit rating. He suggested there was probably no more than $100 million still to find through efficiencies. Further cutting wasn’t going to solve any looming crisis that may be waiting up ahead for us.

And make no mistake, Mr. Pennachetti is now proposing further cuts to departments and agencies that he has already taken a knife to in the past couple years. Zero increases mean less money. Even our current budget chief can do the simple math from that.

As long as the city manager insists on making these kinds of austerity demands, he continues to play accomplice to those who aren’t really all that interested in being fiscally responsible. He offers cover to their claims of being brave and disciplined. He’s insisting on further hardship for those already hard hit by previous cutbacks for the sake of those operating under the faulty premise that they’re hard done by.

Our city manager’s already done much dirty work for Mayor Ford. It’s time he starts looking out for the best interests of those who’ve paid a hefty price for their collaboration.

impatiently submitted by Cityslikr


Budget Chief No

May 29, 2012

As we head into today’s abbreviated budget committee meeting with news of a $90 million surplus for the first 3 months of 2012, Budget Chief Mike Del Grande announces what any good, prudent, sane fiscal manager would. Hey, everybody! It’s party time! Let’s roll us back some sources of revenue. Woo-hoo!!

Or, as Elizabeth Church in the Globe and Mail phrases it: “He [budget chief] plans to push for a reduction of the land transfer tax in 5-per-cent increments beginning next year.”

Huh.

What?

Could you elaborate a little further, Mr. Budget Chief?

“He [budget chief] plans to push for a reduction of the land transfer tax in 5-per-cent increments beginning next year, arguing that the city cannot continue to rely on a revenue source that is tied to the fortunes of the real estate market…Mr. Del Grande says the city’s continued reliance on the tax will leave a ‘massive shortfall’ in its budget when the real estate market cools. ‘The land transfer tax is giving us a false sense of security’.”

O… K… Let me see if I follow the budget chief – who is a chartered accountant, don’t you know – follow his logic here. Because Toronto is experiencing a particularly hot real estate market, despite all the fear-mongering that the land transfer tax would kill people’s ability to buy a house, and is thus generating higher than expected revenues for city coffers, we need to start eliminating the source of revenue in order to wean ourselves off the LTT bounty in preparation for the time when we’re making less when the market cools? Sort of a voluntary reduction before the inevitable enforced one sets in?

Hmmm…

We really need to question Budget Chief Del Grande’s motivations. Or his competency.

Regardless of your position in life, whether a public sector budget chief, a private sector financial controller, an individual homeowner, in gazing into the future and spying a possible economic downturn on the horizon, who reacts with the suggestion to cut revenues? Batten down the hatches everyone! We need to start making less money now in order to be used to making less money later!

It makes no sense.

Don’t believe me?

Ask the city manager, Joe Pennachetti, himself a chartered accountant although, evidently, he secured his credentials at an entirely different school (of thought). In a talk delivered a couple weeks ago at the Munk School’s Institute on Municipal Finance and Governance and one we wrote about here and here, and Matt Elliott wrote here (yes, I do think it’s an important enough point to flog over and over until everyone knows it by rote), Mr. Pennachetti suggested that, while there were still efficiencies to be found, it was revenue generation that we needed to be talking about going forward. City building, whether infrastructure, transit, couldn’t be done through cuts or further efficiencies. Toronto, like every other city in this province, country, continent, needs new sources of revenue.

Of course, city building is not part of our current budget chief’s vernacular. I don’t think it too off the mark to suggest he’s more of the Grover Norquist/starve the beast type of politician. Taxation is bad. Therefore government spending is bad. Widows and orphans be damned.

Only hardcore right wing ideologues would suggest that, in this age of austerity, government look to reduce revenues.

Even if the budget chief demanded that any surplus be used to pay down capital debt, he’d gain some traction as trying to have a reasonable argument although not much of one. The city’s debt level is just fine, thank you very much. Credit rating agency Moody’s thinks so. The city manager thinks so (with one caveat: our social housing repair backlog). Any attempt to compare our situation to that of Greece automatically disqualifies you as a serious participant in this discussion.

Instead, Budget Chief Del Grande only raises the spectre of our capital investment debt to argue against both government revenue and spending. This year it’s: “Councillors who want to spend the surplus are forgetting the huge capital costs facing the city,” he [Del Grande] said, “including the multimillion-dollar tab for refurbishing the crumbling Gardiner Expressway.” Last year we had to cut services and programs in order to pay down the debt.

The budget chief needs to start coming clean with us and simply admit that he doesn’t think government should be in the business of governing. That way, we could cease pretending to have a rational debate on this point with him and get on with what we really should be discussing. Mike Del Grande’s unfitness to be overseeing our city’s finances.

fit of piquely submitted by Cityslikr


Fiscal Discipline

May 22, 2012

Fiscal discipline.

The term screams of denial, restriction, restraint, asceticism even.

So it plays easily into the language of those ideologically bent on cutting our way back to prosperity. Anti-government types who see any public sector spending as inherently wasteful. A discipline of living within our means by way of making due with less.

But what if we interpret fiscal discipline through another lens?

Not one that suggests some sort of punitive action but one that provides a ‘training expected to produce a specific character or pattern of behavior, especially training that produces moral or mental improvement.’ A discipline that teaches the value of our tax dollars spent rather than the simple cost to each of us individually? To train a larger community into seeing that paying less inexorably translates into doing with less. You get what you pay for, folks, and demanding city service levels be maintained (or even improved in the case of transit) while insisting on paying less is the exact opposite definition of ‘discipline’.

Self-indulgence, perhaps?

With Moody’s maintenance of Toronto’s Aa1 credit rating last week, Mayor Ford and his allies hailed their curtailing of expenditures as the kind of fiscal discipline the city needs, conveniently ignoring the fact it’s the same level rating we’ve had for 10 years now. Wait. You mean during the 7 years chief tax-and-spender David Miller was mayor we had an Aa1 credit rating? Doesn’t that give lie to the entire underpinning of Mayor Ford’s reality? That the city was an out-of-control financial train wreck waiting to happen? We’ve borne the brunt of unnecessary cuts owing to a hysteria generated by a misguided but successful municipal election campaign in 2010.

On their radio show yesterday, the mayor and his councillor-brother hosted the city’s budget chief, our own resident Droopy Dog, Mike Del Grande who bemoaned the fact our credit rating hadn’t been upgraded a step to AAA, the highest level Moody hands out. I mean, what’s a guy gotta do to get a AAA around here? How many widows and orphans do we have to ignore before we’re awarded best in class?

“We need firm discipline,” the budget chief said at an Executive Committee meeting last year. “I get a little concerned when we start making arguments about the widows and orphans. Negligibles add up. We cannot afford to do everything that everybody wants us to do…the 2011 budget is cupcakes. We tend to spoil everybody. We need to learn to say ‘no.’”

Yet, we read this from the Moody’s report: “Toronto’s rating relative to other Canadian municipalities reflects a low debt burden and high levels of liquidity, balanced by operating budget challenges typically not experienced elsewhere.”

Huh. Low debt burden and high levels of liquidity. So why is the solution to our operating budget challenges from Team Ford only consisting of saying ‘no’ to government spending and paying down an already low debt burden? Oh, right. Fiscal discipline as a form of abnegation. No cupcakes for you, widows and orphans!

If we want an improved credit rating, Moody’s offers a solution. “Continued fiscal discipline, including a permanent solution to the existing operating budget pressures, [bolding ours] along with a continued strengthening in financial position, could exert upward pressure on Toronto’s rating.”

That would be fiscal discipline with a caveat from Moody’s. To ‘exert upward pressure on Toronto’s rating’ (arguably a necessity at this particular time) the city needs to find ‘a permanent solution to the existing operating budget pressures – in itself a challenge ‘typically not experienced elsewhere’. According to city manager Joe Pennachetti in a talk at the Institute on Municipal Finance and Governance last week, there’s maybe $100 million more in efficiencies to be found which is roughly 1% of a $9 billion operating budget. In other words, we’ve about maxed out in the amount of cutting as a source of fiscal discipline we can do without unnecessarily harming our ability to deliver adequate services.

Now we must talk about generating revenue. It’s hard to believe that any credit rating agency would seriously consider an upgrade until we begin to show that type of fiscal discipline. A willingness to consider and implement new ways to pay for all the services and programs we say we want. Or, what the city manager referred to as city building.

As we ramp up to the 2013 budget debate, starting sometime next month, this should be the direction the conversation goes. The slash-and-burn disciplinarians have had their way, exploiting a faux crisis of their making, not only succeeding at hacking away at services and programs but eliminating vital sources of revenue the city needs to properly develop and grow healthily going forward. That is only one aspect of fiscal discipline and, as it turns out, the least effective.

“The [Moody’s] high investment-grade rating also reflects a large and diversified economy, which remains a source of credit strength, providing access to a broad tax base.”

How to fairly and efficiently tap that ‘broad tax base’ should be the starting point of next year’s budget discussion. It’s one we’ve long avoided having as it’s fraught with political implications and easy prey for those too undisciplined to make difficult decisions. Discipline doesn’t have to mean simply doing without. It can also represent learning how to contribute to a wider good.

floggingly submitted by Cityslikr


Crisis? What Crisis?

May 17, 2012

It was surprisingly calm, Joe Pennachetti’s talk yesterday afternoon at the Institute on Municipal Finance and Governance. Serene, even. Reflections on Toronto’s Fiscal Health and the Decade Ahead: A Discussion with the City Manager. Toronto’s Fiscal Health? I mean, isn’t that sort of an oxymoron?

Nope, according to our City Manager we’re doing just fine, thank you very much. Still got that Double A credit rating. Our debt, hardly runaway, will peak at about 10% of our assets in 2015, a financial situation most of us personally would consider top notch. “We have a very healthy financial city at this point of time,” Pennachetti stated.

It belied the hysteria and apocalyptic noise we were subject to during last year’s budget process. And the year before that. And during the 2010 municipal campaign.

Come to think of it, Pennachetti’s presentation quietly pulled the carpet out from the raison d’être of the Rob Ford mayoralty. We have a spending problem, folks, not a revenue problem. Time to tighten our belts and Stop the Gravy Train.

(Are you as bored reading that as I am writing it?)

Now to be sure, the city manager was not averse to finding efficiencies, trimming whatever fat there was to be trimmed. The KPMG Core Services Review was his idea. Long overdue in fact. He thought it should’ve been carried out over two years not one (another sign there was never any need to hit the panic button the mayor and his allies so wanted push). Pennachetti was also onboard for the aggressive negotiating tactic we saw with the city’s workers earlier this year. Like the Deputy Mayor, he felt the city needed more control over scheduling and back end things like benefits.

Here’s the thing. If I heard the numbers right, the Core Services Review netted the city a savings of about $24 million. The labour savings? About $20 million. That’s on an operating budget north of $9 billion. Or about .5%.

I know everyone has different lines they draw. Count the pennies and the pounds take care of themselves. What’s 44 million when you’re talking billions? But a million here and a million there eventually adds up, etc., etc.

The point I’m trying to make here is those are numbers that don’t correspond to the tumult we witnessed arriving at them. No one’s suggesting finding $44 million in savings wasn’t valuable but was it worth the cost, not just in terms of money but the psychological and political warfare that preceded it? Forty-four million is simply a far cry from last October when the mayor in a speech to the Empire Club warned, Toronto’s financial foundation is crumbling. If we don’t fix the foundation now, our dreams for the future will collapse.

Mr. Pennachetti did want the assembled crowd to know that the $774 million number being thrown around at the beginning of last year’s budget debate as a spectre of this crumbling financial foundation was real. Yeah Joe, nobody ever disputed the veracity of that amount as an opening pressure. There was just a whole lot of disingenuousness in using it as the amount that needed to be cut from the budget, the shortfall needing to be made up. The number was nothing more than a scare tactic used by those wanting to cut more, to cut deeper.

Admittedly, it’s not all chocolate and roses. There are a couple ‘smoking guns’ as Pennachetti referred to them that the city needs to deal with to maintain the current fiscal balance. One is the ever increasing chunk of the budgetary pie taken by emergency services (TPS, EMS and fire department) and the TTC. The other is social housing, especially the eye-popping outlay of cash needed for the repair backlog at the TCHC, roughly three-quarters of a billion dollars.

But as the city manager pointed out, these are things we won’t be able to efficientize™ (Lucas Costello) or rationalize under control. In fact, in one moment of surprising frankness, Pennachetti expressed doubt there was more than $100 million in service efficiencies left to be found in the budget. There would be no cutting our way to a brighter, more prosperous future.

Which is where the 2013 budget debate (coming soon to the airwaves near you) is going to get really interesting. With precious left to cut, the city will be facing the need to approach balancing the budget in two ways Mayor Ford abhors. Going cap in hand to the senior levels or, as some might refer to it, hitting up a couple of fucking deadbeats for the money they owe us. Or we’re going to have to look at generating more revenue, ie raising taxes.

Consider these numbers.

If the province finally re-uploaded the cost of social housing and their half of the TTC operating budget — two things they used to be able to find the money to do – that would free up $550 million for the city which is nearly $100 million more than the estimated opening pressure for 2013. We would then start the debate in positive rather than negative territory. Any talk of cutting services, shuttering programs, finding efficiencies, layoffs would be moot.

That’s not going to happen, of course. Somehow we have found ourselves, alone in the developed world, in a position where senior levels of government contribute precious little to the well-being of their municipalities. They seem to believe that we’re not their problem and serve as little more than piggy banks, sending off money and getting nothing near the value for it.

That leaves us with no alternative but to look at different ways to generate revenue. Yes, raising taxes. This runs contrary to the mayor’s view that we don’t have a revenue problem but, let’s face it, that was an empty rhetorical tic from the get-go. Nothing more than wishful thinking on the part of a sizeable majority of Torontonians who let themselves be convinced that we were overburdened with taxation and under-serviced.

(Interesting observation from the city manager yesterday who said that if we took a picture of an average street corner, we could see at least 20 services the city provides us. Check out slide 4 of yesterday’s presentation to see just all the things you receive in return for the local taxes you pay.)

While the last two budget cycles have been all about austerity and cutting, there is very little left to excise — outside of perhaps the police services which is another topic the mayor will likely be unwilling to broach — without causing serious, irreparable pain that starts diminishing the quality of life in Toronto. It’s now time to start talking about building and growing and figuring out exactly how to pay for it. That’ll include some unpleasant words Mayor Ford doesn’t like to hear but it’s the direction he’s unwittingly taken us in.

supertramply submitted by Cityslikr