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Ford’s “new deal” for Toronto a raw deal for taxpayers

Author: Jay Goldberg 2023/12/05

Toronto politicians have been on a spending binge for years. Instead of forcing them to reckon with the massive debt load they’ve racked up, Ontario Premier Doug Ford caved and bailed them out like a parent paying down a reckless teenager’s credit card bill.

The so-called “new deal” announced by Ford and Toronto Mayor Olivia Chow includes $1.2 billion over three years to help the city tackle its budget deficit.

Ford’s Toronto bailout won’t solve all of the city’s problems. Before Kris Kringle from Queen’s Park came along, Toronto was facing a deficit of $1.5 billion. Thanks to Ford’s bailout, that deficit should fall to about $1 billion.

But Chow still has to come up with $1 billion. The city plans to spend much more than it brings in this year, but cities in Ontario aren’t allowed to run operating deficits. They can borrow money, but only for capital projects.

Step two in Chow’s bailout plan appears to be making a pilgrimage to Ottawa to beg for more cash.

But here’s the cold hard truth: neither Queen’s Park nor Ottawa should be bailing Toronto out of this mess. The city created it and the city should have to deal with it.

Both the province and the federal government are currently running budget deficits. They should be getting their own fiscal houses in order and encourage Toronto to do the same.

It’s worth exploring how Toronto actually got itself into this mess.

Let’s take a stroll down memory lane.

In the last budget passed under former mayor Rob Ford in 2014, the city of Toronto had a spending budget of $9.6 billion.

Then along came John Tory.

During Tory’s nine years as mayor, Toronto’s budget increased by $6.5 billion.

If Tory and his allies on city council had simply kept spending growth in line with inflation, Toronto’s budget this year would be $4 billion less than it is.

Instead of facing a deficit of more than $1 billion, Toronto would have a massive surplus.

Even when population growth is added to the mix, Toronto is overspending by billions of dollars this year.

The numbers are clear: Toronto is in this mess because city hall spent away every last dollar it had. No money was ever set aside for a rainy day.

Toronto doesn’t have a revenue problem. It has a spending problem.

That’s why Chow needs to immediately do a top-to-bottom review of every line item in the city’s budget and reduce government spending.

It’s also worth remembering the money Ford is handing over to Chow didn’t just fall from the sky. It comes out of the pockets of taxpayers all across the province.

Ford isn’t giving Windsor a special cash infusion. London isn’t getting an early Christmas present. Sudbury isn’t getting Ford bucks.

Why should taxpayers from everywhere else in Ontario have to bail Toronto out from a mess of its own making?

During his press conference with Chow, Ford tried to justify his bailout by claiming Toronto plays a special role as the economic engine of the province.

That may be true. But Toronto has been the economic engine of the province for decades. It hasn’t needed a special billion-dollar bailout package until now.

Ford is helping Toronto city hall avoid reckoning with its own mistakes.

Every parent eventually learns the lesson Ford will surely face down the line: if you pay down your kid’s credit card bill without any consequences, the situation is bound to occur again.

Chow wants to spend billions of dollars more than the city is spending today. Most of city council seems willing to do just that.

Ford shouldn’t be surprised if he finds himself back in this very same situation a few years down the road.

Bailouts without consequences are sure to bear repeating.


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