Usually I ignore the gliberatarian, Fraser Institute-dominated editorial board of the Vancouver Sun, who don’t seem to read the contradicting articles published in their own newspaper. I could get upset – every day, even – at the obfuscation that graces that page. But after Gordo’s big speech last night where he gives with one hand and pickpockets back more with the other…I’m in a mood. Let us begin…
Take note that we don’t mean slowing down the rate of growth of spending, but making real reductions in spending. This has to be spelled out because politicians don’t seem to be able to grasp the difference.
Here is the “thesis”. The City of Vancouver’s spending is out of control. We know this because there have been two large budget shortfalls in 2009 and 2010. Fine, first you need to demonstrate what portion of the spending increase that make up the shortfall is, and this is of course subjective, “unjustified” (and we will deal with this part later). And two…there is a very important factor, one might even say the primary factor, being left out.
And that’s the loss of revenue from the economic slowdown created by the Great Recession.
The CoV relies heavily on the revenues collected from building permits and other fees associated with the housing and construction industries, which are themselves reliant on access to capital from hedge funds and so on. And building starts took a whopping hit and are only now returning to pre-September 2008 levels. With this in mind the patronizing politicians don’t seem to be able to grasp the difference seems, well, jarring and dishonest.
Budget documents reveal that the city’s operating expenditures have soared by 68 per cent since 2000, from $610.9 million to an estimated $1.026 billion in 2011. That’s more than double the rate of inflation (22 per cent) plus population growth (10 per cent) over the past decade.
Good point! But…what’s not being mentioned? I think it might be something big that happened in 2010 that the City spent the better part of that decade preparing for. Do you think that big thingamajig might have been a factor?
It’s also an increase of $60.2 million over last year, of which $34.9 million will fund a four-per-cent increase in salary and benefits for the city’s 6,000 workers.
So now we get down to the heart of the Ayn Rand Fan Club Editorial Board’s objection – salary increases from the 2008 contract for [assumed overpaid] civil servants. Now, watch carefully because there’s a shell game going on.
These wage gains are far in excess of those in the private sector, or the provincial and federal governments, where zero-increase contracts have become the norm.
Okay, did you see what they did there? Far in excess of increases in the private, provincial, and federal sectors (where zero-increase contracts have become the norm!)…in 2010! As mentioned the current contract, signed by the previous civic government, is from 2008. So the Sun is chiding an agreement made in boom times and with the Olympics looming with decisions being made in the economic climate of 2010. Not. Honest. And if only that collective agreement had been the usual 3 years rather than the 5 years the previous management insisted on. We might not be having this conversation!
These so-called “priorities” should be subject to the same cost-saving exercise as every other sector. Besides, as every manager with budget responsibilities knows, you hunt where the ducks are.
Now I can agree with that. It should be the rare occasion where you lock yourself into certain decisions in advance. But it goes both ways – limiting the property tax is also locking yourself in to a decision that the facts on the ground might not dictate. Of course, to the Fazil Mihlar-era editorial board, taxes bad, spending cuts – no matter who they hurt – good! The tax burden of Canadians in general, British Columbians and Vancouverites in particular is not burdensome. We are on the lower side of the scale of industrialized countries (OECD, .xls). Let’s jump ahead to
The business community fears, with reason, that the Vision-dominated council will renege on its commitment to shift one per cent of the tax levy each year in order to meet its target of a two-per-cent tax increase.
Based on…what? Their past record of shifting 1% from non-residential to residential property? From their public statements indicating they plan on continuing to do so? I’m serious – this “concern” is pulled out of thin air.
Such a move would deepen suspicion that the council is insensitive, or at worst hostile, to the needs of business.
Here’s why I don’t think the editorial board reads it’s own newspaper. Yes, the poor Vancouver businessman labouring under the…..least burdensome cost of doing business outside the Third World? In fact, Fazil Mihlar himself penned this back in July:
The 2010 KPMG study of 95 cities across 10 countries concluded that Canada was the best place to invest, with a five-percent cost advantage over the U.S. Out of the 35 major cities with populations of more than two million, Vancouver, Montreal and Toronto ranked in the top 10 in terms of cost of doing business.
I guess he forgot. And to say Vancouver is “in the top 10” is itself a deflection just how good it is to do business here:
The report ranks 41 major international cities, with Vancouver ranking first
Oops. Speaking of which, is the tax-shift even useful? As this letter writer ponders persuasively…not in reality:
When this issue last came up, I spoke to some small-business owners and was told most did not own their property. They laughed when I mentioned a reduction in taxes and said it was most unlikely that the landlord would ever pass any tax reduction down to the small-business tenants.
The rich get richer. The little guys continue on continuing on. Now to the whipping post du jour, cycling lanes:
The 2.4-kilometre Hornby bike lane will cost $3.2 million; by comparison, Montreal is laying down 51 kilometres of bikeway, including nine kilometres of repaving, for $9.9 million.
Certainly sounds like Montreal is doing a better job, but are we comparing apples to apples here? HAHA…of course not!
Of the 51 kilometres to be added to the existing 502-kilometre network in 2010, about 40 kilometres will involve lanes and cycling symbols painted on roads. The remaining paths will feature concrete medians separating cyclists from cars.
Painting lanes and symbols is a minimal cost. Repaving isn’t all that expensive either. What is expensive are turn signals, which the Hornby lane requires. The 11km Montreal separated system, costing more than 3x as much is comparable to Vancouver’s costs on Hornby. By way of comparison, a parking spot for an automobile “costs $5,000 to $25,000 to construct, resulting in $500 to $1,500 in annualized construction and operating costs.”
Now some say, despite the current government being elected on a platform advocating it and a Capital Plan referendum validating it, that cycling infrastructure is not a priority. The priority for the Sun is cutting spending, cutting taxes. To the bone.
They won’t be happy until there is no government, and a world in which unaccountable corporations run every part of our life.