Volume 38, Number 4: July/August 2004

Compete or Die

Toronto at the Mercy of an Old Imperative

The campaign to make the city of Toronto competitive has been waged for more than a decade by supporters from across the political spectrum. Competitiveness, a catch-all term, is often measured by how many companies and tourists are lured here instead of Chicago or Cleveland or Charlotte. And there is a list of things a city like Toronto apparently needs to have in order to attract the big-spending tourists and investors looking for places to park their fortunes.

The number one priority is to be business-friendly, with low business costs (tax rates), good infrastructure (typically an uncongested network of roads and highways on which to transport goods) and high quality of life (or the kind of reputation that makes high-income earners want to come and visit or live).

New Deal Talk

The latest tactic in the campaign is the fight for a new deal for cities, a hackneyed phrase that, by now, has taken root in the subconscious of any regular reader of the Toronto Star. The new deal talk may have started in Toronto in 2002, during the hype surrounding the so-called mayor’s summit on the city, organized by the Star, the Toronto Board of Trade and the University of Toronto’s business school, among others, with virtually no participation by the mayor.

But these days you can’t really find anyone, anywhere, who will say they are opposed to the deal. Even so, there is no full picture of what such a deal would or should be, other than a few extra “affordable” housing units (don’t look too long for a definition of affordable - there isn’t one) and some more money for transit (which sometimes also means roads and highways). That the campaign is, first and foremost, organized to save the fortunes of the city and its employers, and is only secondarily interested in the people who actually live here, is not up for debate. Suppress all questions about the details, like who will eventually benefit from the deal, and focus on getting Queen’s Park and Ottawa to agree to write their cheques.

In Toronto, the summit filled a void left by the three political leaders - then-mayor Mel Lastman, outgoing premier Mike Harris and then-prime minister Jean Chrétien - who, it was agreed, had dropped the ball in the game to make Toronto more competitive. It blossomed into the Toronto City Summit Alliance, with involvement of leaders from organized labour, charities, and community groups, as well as social advocates, to create a “civic advocacy organization” to bolster the city’s position for business and quality of life.

Even after the election last fall of a mayor eager to take up the cities’ agenda in the person of David Miller, a member of the NDP, the Alliance is still going strong, folding Miller’s main opponent, Conservative John Tory, into its steering committee. The Alliance has an office and a staff member and is working on affordable housing, attracting public investment to a high-tech research alliance, and on a campaign to get professional immigrants into career-relevant jobs.

The Alliance has highlighted a second political void: the absence of a strong, autonomous and diverse urban Left, representative of the people who live in Toronto, to identify priorities independently of the city’s economic elite. Miller’s election campaign fit in with the overall priorities identified by groups like the Board of Trade and the Alliance, and he was the left wing of the race.

This legacy can be traced, in part, back to 1996, when Fortune magazine announced Toronto was the best city in the world in which to live and do business, indirectly endorsing a decades-long metropolitan development path that saw it avoid the pitfalls of its hollowed U.S. counterparts.

But U.S.-style change was already under way. A 22 per-cent cut to Ontario welfare rates imposed by the Conservative government at the end of the previous year left those relying on social assistance in Canada’s most expensive city desperate and destitute. That year’s census forms, completed but not yet tallied, would also reveal persistent poverty and underemployment, disproportionately affecting people of colour, recent immigrants, women and young people, despite an apparent economic recovery.

Organized labour, activists and community organizations got together and shut down the city for a day in October to protest the business-friendly provincial policies. It was virtually an unprecedented show of strength, as hundreds of thousands took to Toronto streets. But the protest did not articulate an alternative urban programme and underlying the unity was a budding debate about strategy, particularly among groups whose funding was under siege: was it perhaps better to work with potentially friendly forces closer to the government to achieve some gains than to risk shutting off all access to the current provincial power base?

Amalgamation and Downloading

Surviving the one-day shutdown virtually unscathed, the province’s businesses should have been happy. Their government at Queen’s Park was doing everything it could, as quickly as it could, to help their bottom lines by slashing tax rates and wage bills. But Toronto businesses - led by banks, real estate companies and hotels - wanted more. For one thing, they were disgruntled with their property tax rates, which were much higher in the city core than residential rates and suburban business rates. Business groups ramped up a campaign for restructuring that would eventually result in the amalgamation of Metro Toronto municipalities, major property tax reform and the downloading to municipalities of a host of social services in exchange for the uploading of some education costs to the provincial tax base.

Immediately, policy wonks and social advocates saw major flaws in the moves. Making Toronto property taxpayers res-ponsible for financing a larger chunk of social programmes like housing and welfare would push local tax rates even higher and lead to the U.S.-style emptying of the central city that, it was said, would hurt the city’s competitiveness (not to mention threaten downtown real estate interests). With pressure coming from a variety of fronts, not least Bay Street, some tweaking was done to the restructuring, forcing the surrounding suburban tax bases to contribute to Toronto’s social service costs and, later, placing a cap on the city’s business tax rates.

Failed Summer Olympics Bid

Problem solved, for the time being. Right away, a group of municipal bureaucrats and business interests came together to organize a bid to host the 2008 Summer Olympics, facilitated by the ubiquitous David Crombie, a former mayor and federal Tory cabinet minister who symbolizes Toronto’s urbane past. Preparing for the games would be a major public infrastructure project and would help the city weather a possible future downturn in the real estate development market. But they needed to make sure that at least some social advocates and community groups were on side, to avoid the problems encountered during the bid for the 1996 games, when it is said that the activist group Bread not Circuses scuppered the city’s chances with effective protests in front of the International Olympic Committee.

It was easy to get certain labour groups on side. Hotel workers and construction trades saw the games as an opportunity to strengthen their bargaining positions. Some community groups were also lured into the fold by promises that the games would leave a legacy of housing, cultural facilities, and green construction, along with Olympic-sized sporting facilities. With the newly amalgamated city increasingly being characterized as fraying, the Olympic bid would be a way to bolster civic pride and justify some major public spending.

But it was not to be. After Toronto lost the bid to Beijing in the summer of 2001, whatever civic pride was mustered turned to dejection. Lastman, Harris and Chrétien seemed to forget their promises of millions to help clean up the industrial waterfront to make it safe for tourist and condominium development - a project that was supposed to remain on the books whether or not the city won the chance to host the Olympics there. Having lost a direct race with other world cities for the games, the city’s competitiveness was more in question than ever.

One More Shot At Being Competitive

The Toronto City Summit Alliance is, essentially, a reconfigured Olympic bid committee. Crombie is still on board, as are the business groups, labour leaders and charities. The new organizing principle is the deal itself, instead of the games that would have necessitated such a deal. And it has undeniably hit a high point, with politicians rushing to make fuzzy and warm promises to support it. Unabated homelessness and road congestion, along with a financially squeezed public transit system, have made the campaign common sense. So-called ordinary Torontonians are signing petitions, this one organized by the Board of Trade, that one organized by the Toronto and York Region Labour Council, for more money for transit and other “solutions” to the city’s problems. So far, the only unabashed winner in the campaign is the ideology of competitiveness itself, which has emerged stronger than ever. Whether the new money being promised helps out private transit consortia in car-oriented suburbs more than transit riders, or landlords and developers more than tenants, is not important. At least Toronto will have a shot at being more “competitive” again.

Karen Wirsig is an independent researcher on urban issues in Toronto.