On one side of the front page of today’s Sudbury Star, reporter Mary Katherine Keown reports on a new study by urbanMetrics on the “impacts related to the arena and the impacts that might occur with the relocation of the arena and the casino to the proposed Kingsway Entertainment District.” The report concludes that the Zulich/Kirwan project is not good for the city (“Why a casino would be bad for Sudbury: report,” the Sudbury Star, March 14, 2018).
Right beside her article on the new expert report, Mary Katherine Keown interviews Councillor Robert Kirwan, who repeats his unfounded assertions that the project will be absolutely terrific for the city (“Why a casino would be good for Sudbury: supporters,” the Sudbury Star, March 14, 2018).
This is what passes for balanced coverage in Sudbury. As long as anyone believes that the project might have a positive impact, Mary and her editor will give them equal coverage.
We saw CBC using the same approach in its reporting on climate warming. As long as anyone was willing to deny it – even though they were vastly out numbered by real experts, even though many of the deniers were funded by oil and coal companies – CBC would give them equal coverage.
The result was that it took years longer for the truth of climate change to sink in. The CBC’s notion of “balanced coverage” turned out to be misleading. The Star’s notion of “balanced coverage” is just as bad.
urbanMetrics is a consulting practice with more than 35 years of expertise. The firm provides custom market analytics and municipal strategies that drive investment in real estate, infrastructure and community assets. It is the kind of company that Cities consult to make sure they understand the economic and social impact of projects.
Robert Kirwan is a freshman councilor whose grasp of economics was never very solid (as I and others pointed out repeatedly). I happen to be an economist who has done a number of economic impact analyses – I’ve felt fairly confident in refuting many of his obviously unfounded assertions in blogs and interviews. Basically Mr Kirwan proved unable to support his assertions. Mr Kirwan dismissed me as a “washed up dinosaur” of a professor.
So along comes another professional report, and the Star puts Robert’s nonsense beside it on the front page. It is a bit like putting the Sudbury Wolves into a Stanley Cup match with the Boston Bruins. Great story, but no one would pay to watch the slaughter if the two sides actually faced off.
Balanced coverage isn’t a matter of treating all opinions equally. It is a matter of balancing facts. It is not about pandering to each faction in the community. It is about helping the community decide what the truth is.
The simple fact is that every expert report has come down against the Kingsway project. The simple fact is that the most informed and active citizens in the region have come down against the Kingsway project. The simple fact is that Council, driven in part by a man who sees dinosaurs under his bed, ignored the expert advice of consultants and staff.
The simple fact is that the Star’s “balanced reporting” amounts to treating tinfoil-hat economics with the same respect as the work of professional consultants. That is what the CBC did with the climate change debate.
CBC’s policies probably delayed action on climate change. Delay will almost certainly result in people dying. CBC’s reporters and editors are partly responsible
The Star’s editorial policies in this case help shore up one of Council’s most egregious mistakes. The mistake will almost certainly cost the City tens of millions of dollars. Mary Katherine Keown and her editor are partly responsible.
Postscript: Mary Katherine Keown is a good reporter, and I like her. She doesn’t decide what goes on the front page of the Star. Getting Mr Kirwan to respond to the report makes sense – his views got clobbered and his response deserves a line or two in her piece on the urbanMetrics study. Treating him as though his economic opinions deserve equal play, however, is misleading even though it is standard journalistic practice and helps sell papers.
The Labour Force Survey from Statistics suggests that Sudbury may no longer part of Canada. Employment. Employment in this most successful country rose by 1.5% over the last year. Employment fell in Sudbury by 2.6%, or 2,100 jobs. Ontario’s employment rose by 1.6%.
Sudbury’s unemployment rate, at 6.7%, is well above the national rate of 5.8 or Ontario’s rate at 5.5%
Why the differences? It would be nice if we could say it is just provincial mismanagement, but there are some larger forces at work. Employment in the forestry, fishing, mining, quarrying, oil and gas extraction sector-declined by 8.6% across the country. We depend on the mining part of that sector. Most of the decline was in the oil sector, largely in the west, where expensive tar sands production is having difficulty competing with American shale oil. The mining sector is having difficulty competing with crypto-currencies for development funds. The crypto-currencies are just a lot more rewarding for get-rich-quick speculators than traditional, slow moving mining plays.
And around the world, hinterland regions like ours are losing people. Production in these regions is tied to the resource base, and we are not getting more resources. Meanwhile, technology keeps eating away at the workforce. Production in the cities, on the other hand, is based on people. Job growth in the cities is not limited by the resource base.
So what do young people do in the resource areas? They move to the cities. In fact, the most talented ones move to the cities, further reducing the growth opportunities.
Management is an issue, of course. Northern Ontario remains an internal colony for Queen’s Park. Northern Separatists are right to think the North would be more prosperous if it were run by Northerner’s for Northerners. Adam Smith said it long ago – self-governing areas develop more and are wealthier than areas governed from outside. Modern research keeps finding Smith was right.
You can’t really blame the North’s slow decline on Kathleen Wynne or her henchman, Glenn Thibeault. The job of Premier of Ontario is probably the toughest political job in the country. Kathleen inherited a system that she promised to make work. It is a nearly impossible job. As a southerner she probably believes it works pretty well already. She is not going to rethink the foundations of the province.
Glenn is a different story. We can’t expect a guy hand-picked by the southern Premier to be a radical advocate for the North. He has been given the job of watching bureaucrats run the provincial energy system on behalf of Ontarians (96% of whom live in the south). Part of his time is taken up in delivering checks to local organizations. Besides, Glenn has never been a “policy guy’ or a deep thinker.
The odds are that the Province will be unable or unwilling to come up with a “Northern Growth Plan” that really works. The odds are that the political system will go onward the same though dynasties pass, to quote Thomas Hardy. And the odds are that Sudbury will continue to slide slowly.
What is certain is that nothing much will change until we start to face the political and economic realities of the North.
Three Cheers for Sudbury’s Rethink Green. Instead of waiting passively for the electric car revolution, Rethink Green is bringing it on with “EVOGS.”
EVOGS stands for Electric Vehicles of Greater Sudbury. It may be the ugliest acronym in town, but it is a beautiful, brilliant, simple idea: actively encourage local businesses and organizations to install charging stations.
EVOGS objective is to actively promote the use of green vehicles: hybrids, plug-in hybrids, and electric vehicles. They also want to see Sudbury include “green” parking spots, and expand on its growing electric charging station network.
ChargeHub.org already shows 10 charging stations in the city. There is one supported by the Ministry of Transportation, one Tesla SuperCharger and one at Science North. The Quality Inn has an electric vehicle charging station available in their parking lot. There are already four charging stations between Toronto and Sudbury.
EVOGS may seem like an almost insignificant local project, but it is a sign of real change happening just under the surface. Rethink Green is making Sudbury fit for the electric car.
There is a tendency to think that the electric car invasion is a long way off – “Batteries aren’t good enough”, “There are not enough charging stations”, “Everybody has range anxiety,” “Northerners only want pickups and there are no electric pickups,” “Electric cars don’t work in cold weather.”
Like most technological revolutions, the electric car revolution is accompanied by a chorus of reason why it can’t happen. And like most technological revolutions, this one is coming faster than you think.
All the major car companies are committing to electric cars – they all have multiple models coming out in the next few years. Existing batteries are more than adequate for 95% of the population’s needs already, and the batteries get better every year. It is widely acknowledged that electric cars are already cheaper to run, are definitely cheaper to maintain because they have fewer, simpler parts, and will soon be cheaper to produce. That happens as soon as car companies achieve competitive volumes. The only super cars that can still beat electric cars are hybrids with electric motor assist to give them comparable acceleration.
At the moment the Province of Ontario offers remarkable incentives for consumers to purchase electric vehicles as well. This is a transitional program. The incentives will disappear as soon as the number of electric vehicles on the road reaches some critical number. And when that happens you will know that the revolution has happened and there is no turning back.
I am constantly surprised at the fuzzy thinking of all the politicians I know and read about when it comes to the topic of revenue neutrality for the carbon fee.
Revenue neutrality is used as code for ” I won’t raise your taxes.” In political speak it has come to mean I will cut some other taxes so that the government budget does not increase.
The government budget is not the relevant budget, however. It is the budgets of the ordinary people – the “household budget”, in the language of economists. A carbon price has to be revenue neutral for households.
The problem is that a carbon tax raises the price of hydrocarbons for transportation, heating and production of goods. This has two effects – people will substitute away from goods with high carbon content because they cost more. This is good. Economists call it at “price effect”
People will also buy less because they are poorer. The cost of carbon has gone up and they can’t jump completely out of the carbon economy so the cost of living rises. They have less money for other goods and services. Economists call this the ‘income effect’ of raising prices. We do not want to exacerbate the income effect. We don’t want to make households poorer.
A big reason to worry about the income effect is that it has serious negative macro-economic effects. Less real spending. Fewer jobs, poorer people.
Can you have the (good) price effect without the (bad) income effect? Sure. You give all the revenues collected with the carbon fee back to the households, preferably in a monthly check.
This way your get revenue neutrality for the government, but you get something much more important: revenue neutrality for households.
The Citizen’s Climate Lobby was the first to come up with a scheme that achieves revenue neutrality for households with their “Carbon Dividend.” Some politicians and members of the press have come around to the idea (Patrick Brown was one – and it seems many in the Conservative Party of Ontario hated him for it).
Most politicians, though, are still afraid of the carbon tax. Only a high carbon tax can have a significant effect on behaviour. Given their limited grasp of economics, they imagine a high carbon tax will destroy the economy. They are sure that a high carbon tax will destroy their political careers. The are wrong on both counts, of course. With revenue neutrality for households, a high and effective carbon tax is almost painless.
Unfortunately, the politicians have gotten hung up on the the idea of revenue neutrality for governments. Some – -mostly on the `left’, but also the liberals in BC and Ontario — are even more confused. They think that if they spend some of the carbon tax revenues on good environmental projects or research they still have revenue neutrality. Our Minister of Energy, Glenn Thibeault suffers from this dangerous mindset, alas.
Real revenue neutrality for households is the key to fighting climate change. It is time our leaders got this straight. If you are still reading at this point, take the chance to explain relevant revenue neutrality to someone. If you are a Liberal — and I know many of my readers are — explain it to Glenn or another Liberal. Their confusion matters more than Andrea Howarth’s or Doug Ford’s, at least for now.
I have been reading articles in the journal Regional Science and Urban Economics because I am teaching Regional Economics this term. I came across “Sports facilities, agglomeration, and public subsidies” by Brad R. Humphreys and Li Zhou in the September 2015 issue.
It is a long and technical piece with an interesting summary of who wins and who loses when a city creates an arena district. The analysis obviously applies to Sudbury, and it is really too bad I didn’t find the article before we here made our fateful decision about where to put our new arena. The authors write:
“The creation of an arena district generates both losers and winners. The losers are service providers at the existing consumption center, who either experience a reduction of profits or have to exit the market, and owners of residential properties within a certain range of the existing consumption center, who experience a reduction in housing values due to the decline of services supplied in the existing consumption center.
“The winners are service providers in the arena district, who make positive profits because of the agglomeration effects of the new sports facility, and property owners within a certain range of the new professional sports facility, who experience an increase in property value due to the increase of service supply in the area.”
Council created winners when it decided on a location for the new arena. It also created losers, as I pointed out in posts last year. It would be nice if proponents of the project would be a bit more honest about the game they played.
There are still a few people who think that a casino will be good for the local economy. As an economist I find this pretty mysterious.
In the past, two kinds of communities have benefited from casinos: major tourist destinations and empty crossroads. If you are already a destination for tourists — and Sudbury is not — then adding a casino can supplement established attractions. The Big Nickel Mine is not the kind of established attraction with high-level casino synergies.
If you live in Nowheresville, a casino can’t steal customers from local businesses and can create some local and travelling gamblers. Sudbury is not Nowheresville.
Sudbury is just another town the province wants to suck money out of. The best guess I have seen about how much more the province will suck out is about $50 million more a year. This money comes out of the revenues of other businesses.
Council hopes to get 5 per cent of the casino net take — or about $2.5 million a year. This is Judas money: Council is selling out existing business for 30 pieces of silver. In the musical Jesus Christ Superstar, Judas sang: “Please don ’t say I’m/Damned for all time.” That chorus could become the theme song for members of this council.
The increase in gamblers will come from Sudbury. With casinos in the Sault and North Bay, and possibly one on Manitoulin, there is no way that a Sudbury casino will be a big attraction.
The truth is that a Sudbury casino will make lot of money for the province. It will probably be built whether we like it or not. The past city council agreed to allow a casino because they thought they could get the corporation to pay for our new arena. The current council has decided to pay for an arena to bribe the casino to come. There are suckers elected every four years.
But the key point I want to make, as an economist, is that a casino is not good for the Sudbury economy. Don’t pretend it is.
(originally published as a Letter to the Editor of the Sudbury Star – online, January 1, 2018: http://www.thesudburystar.com/2018/01/01/letter-casino-will-not-help-local-economy)
The forced amalgamation of the City of Sudbury and the surrounding municipalities has not been a success. Costs have risen, democracy has declined, and a more powerful bureaucracy has emerged.
The City of Sudbury and its suburban communities were reorganized into the Regional Municipality of Sudbury in 1973, and was subsequently merged in 2001 into the single-tier city of Greater Sudbury. The major benefit, from the point of view of the provincial government, was that it reduced the number of democratically elected representatives. The superglue bill that stuck all the communities together, you recall, was called the “Fewer Municipal Politicians Act.”
Some might argue that what Mike Harris has joined together no person should sunder. It is done, they say, and the people of the region should just suck it up. Certainly the recent study by the Fraser Institute suggests that it is very difficult to undo amalgamation. Not impossible, but very hard.
But de-amalgamation is not the answer to the mess made by a forced and baldly thought out amalgamation. The real answer is RE-Amalgamation.
Re-Amalgamation means re-thinking the structure based on our 16 years of experience. What we know now is that the communities of this “Constellation City” are not happy with the result. In 2006, faced with growing discontent and a growing de-amalgamation movement, the City set up a Community Solutions Team.
The Team adopted the concept of a “Constellation City” made up of individual “stellar” communities. The committee offered recommendations that would make the city “Connected, Caring, Empowered and Equitable.”
The recommendations of the Team have not been followed and the problems have not gone away. Many outside the core still feel disenfranchised. Decision making has not been localized. Transit is only slightly better. The Community Action Networks are still a pathetic imitation of participatory and democratic local institutions. Ward boundaries still chop communities up. The old core downtown communities in particular are still poorly represented.
The notion that anything would be solved by directing $2 per person to the CANS was always absurd. Token democracy is token democracy no matter how hard you wish.
In fact the City needs to reconstitute the local councils, and to return significant decision making to the local councils. There is no good reason for the representative for Long Lake to vote on whether Valley East should purchase a surplus school for a community center. If people in Valley East want to pay for it that should be their decision.
There is only one reason why the New Sudbury representative gets to vote about amalgamating arenas up the Valley. Under the current structure, the people of the entire region now pay for recreational facilities for residents of the Valley. It is an application of the principle of no taxation without representation. But it does not make sense to tax people in New Sudbury for recreational facilities that they don’t use in other areas. Before amalgamation these communities built their own arenas and cut the grass on their own soccer fields. They could do the same under Re-Amalgamation.
In the Fiscal Swamp of Greater Sudbury, the people of the Valley no longer are responsible for their own community, and they have little say about what they want. Amalgamation has diluted everybody’s voice. That is a profound misunderstanding of democracy.
And it can lead to massive overspending. ‘Logrolling’ is defined as the practice of exchanging favors, especially in politics by reciprocally voting for each other’s proposed legislation. You vote for my road expansion and I will vote for yours. My people get a road, but they think they only pay for part of it. The result is well known to students of political science – ballooning budgets as politicians collaborate to get benefits for their own areas, even though their citizens end up paying more overall.
The right solution is that people in the south of the city should only contribute to roads or recreation in the north part of the city IF they are convinced that they actually benefit. That word “convinced” is central to democracy. If our kids in the south use 10% of the arena, we should contribute 10% of the cost. If the people in Azilda want their road four-laned, they should just go ahead an four-lane it. The province should and will contribute part of the cost because it is part of the provincial highway headed to Timmins. The people of Garson have no stake in that road. Users should decide and users should pay.
Sharing costs this way is actually a cooperative model of city finance. Communities build what they want for themselves and the negotiate if they want other communities to contribute. Working out acceptable cost shares for projects would achieve fair allocation of costs and genuine empowerment of communities. We would probably see a lot of local referenda if we had real local democracy. Referenda may cost time and money, but they are a better way to spend than on unwanted or overpriced projects.
Changes like this are within the power of the existing council. The City does not have to ask permission to Re-Amalgamate. All it has to do is recreate local councils and hand over to them the right to make specific decisions about local issues as well the power to set local budgets for local projects. The Council of the City of Greater Sudbury would only deal with coordination and issues that affect more than one community.
Does this sound like the old Regional Government model? It isn’t too far off. Regional government was actually working, so why not? But with a bit of thought we could achieve an improved version. We could keep any savings that come from centralized purchasing and centralized service provision. We might have a common land use plan and might share snow plows. We could have a real “constellation City.”
Re-Amalgamation is legal and feasible. It should be done gradually and carefully, but the process should be started soon.
On Monday, October 22, 2018, when the next city election comes around, the citizens of Greater Sudbury should elect a council that really wants to fix the mess that an ill-considered amalgamation brought us.
Vote for the Re-Amalgamation candidate in your ward.