83 Comments

Is there analysis on the effect that economies of scale would have on this analysis? It might be easier for Ontario to deliver more services for a lower cost per capita. I suspect this model of measuring conservatism is mainly useful for its simplicity, not its incisiveness.

Expand full comment

This is exactly the comment I was going to post, so thanks for already adding it to the conversation!

Expand full comment

Short version: 1. governments suffer from diseconomies of scale more often than economies of scale. 2. If there is economies of scale, surely the difference between a population of 5 million (Alberta) would be negligible compared to a population of $16 million. And what about Quebec? Where are their economies of scale?

Expand full comment

AB and SK do have geographic disadvantages in terms of having far more dispersed populations due to having most of Canada's arable land. They are also the only landlocked provinces and the most distant from American population centers.

Expand full comment

HAve you been to Thunder Bay?

Expand full comment

Still not as remote as Grande Prairie or Ft. McMurray or Peace River

Expand full comment

Are they *really* providing the same basket of services, though? If you go to an emergency department in Toronto vs one in Calgary, are you seen and treated in comparable amounts of time? Do you have the same access to family doctors and medical specialists? Are public school students delivering the same results in terms of educational attainment in reading, math, and science? I think there's an argument that Ontario is spending less, and delivering a lot less.

Expand full comment

Potentially fair point. But when I did the analysis in 2011, it was far from clear that Alberta had better services for the extra 40 percent per capita that it was spending. See: https://www.policyschool.ca/wp-content/uploads/2016/03/alberta-spending.pdf

Expand full comment

My dad was an executive with the Capital Health Authority and Alberta Health in that time period, so I strongly suspect much of that excessive spending was the result of the special cause of inflated wages and capital project costs in an overheated economy during an oil boom. The provincial government was shoveling cash out the door during that period, spending whatever it took to buy labour peace, and initiating capital projects in response to political pressure no matter what they cost. There was at least one project my dad was involved in where they couldn't get anybody to bid because of the spiraling cost of steel, until the health authority agreed to take responsibility for that cost risk.

Expand full comment

As a matter of fact, I went to the emergency department of a Toronto hospital yesterday. It was clear when I arrived that I'd have considerable competition for attention; yet by the end of half a day I'd been through the triage process, had my blood tested and processed by the hospital's on-site lab, seen two doctors, undergone an ultrasound, had the possible malady that sent me to emergency in the first place ruled out, and received a diagnosis for what I do have, along with a prescription for medication to deal with it. I don't know how this compares with other provinces, but I'm happy with the result; and I think the fact that all I had to do to interact with several health care professionals and receive medical services was show my health card is amazing.

Expand full comment

Exactly! Which other provinces are closing hospitals and driving away health and education workers with anti-labour laws?

Expand full comment

Anti-labour(union) laws encourage investment which, in the long run, is more valuable and makes us all better off than unionized public-sector workers do. Unionized teachers want to move somewhere else? Let ‘em.

Expand full comment

Yes look how well the anti-labour laws are working in the US. Meanwhile European countries with great labour laws still have good economies.

Every man for himself and damn the women and children seems a little dystopian to me, and there but for the grace of god, would be you.

Expand full comment

The US has a much stronger economy than Europe, and it isn't even close. Better wages, more value creation and more innovation as well.

US at-will work laws work on the presumption that no one is entitled to a job, just like no one is entitled to a profitable business. It's IMHO the most realistic and healthiest employment market. Easy to hire since low risk because it is easy to fire. This also encourages people to leave bad jobs or ones they aren't good at.

It's been noted in studies that California's at-will work laws coupled with their ban on non-compete clauses are a big reason Silicon Valley and Hollywood even exist.

Expand full comment

Anti-labour laws suppress wages which reduces the need to innovate and so reduces investment.

Teachers, unlike the majority of public servants, have to show up at work and do their jobs.

Expand full comment

They do suppress wages, but they do that by introducing more direct competition into the labour market. They diminish the value of job seniority and increase the value of competency, scarcity of specialized skills and merit.

Expand full comment

But if we innovate and make work processes more productive, we mostly do that by investing in machines and reducing the amount of high-wage labour we need, and you guys won't like that either. Union-friendly jurisdictions lose investment to places with the right to work without joining a union, all else being equal.

During Covid, teachers stayed home for two years. Don't tell me they did much Zoom teaching because we know they didn't.

Expand full comment

"You guys?" You know nothing about me. I just stated an economic opinion, which you restated to refute me.

Expand full comment

Doug Ford is a screen door on a submarine. You suggest "he's providing services". He isn't. Ironically, healthcare is on life support, and the time spent waiting in emergency can be hazardous to your health. That applies to social services, and education as well. Doug has one goal- enrich his friends, and pave. Pave frigging everything. He defines useless...and his picture should be in the dictionary next to the word "graft"

Expand full comment

As an Ontario Tory, I find this analysis more than a bit shallow. $200 debt-financed cheques in the new year don’t make anything other than crass political sense, while our medical system continues to slowly unravel.

Expand full comment

I dunno. I’d rather have $200 than be forced to pay for your MRI.

Expand full comment

But I pay for every Ontarian's MRIs even if I'm getting the $200 cheque. I am okay with public healthcare though, not with short term view electoral candies.

Expand full comment

I'd love to see what Alberta's tax and services situation would look like if energy royalties weren't part of the equation. Supposedly conservative governments there have treated royalties as a personal piggy bank for a very long time. No one put money aside for future generations as much as Peter Lougheed did.

Expand full comment

Instant deficit of an additional $25.2 billion in 2022. (Alberta recorded a surplus that year of $11.2 billion. Without resource revenues, it would have been a deficit of $15 billion).

Expand full comment

That is frightening

Expand full comment

Wow. Just wow.

Expand full comment

So add a PST and call it square?

Expand full comment

No, they would rather close schools and hospitals. That is what they have done in the past.

Expand full comment

It was a math estimate. Not a request to action.

Expand full comment

...or reduce per capita spending to Ontario levels

Expand full comment

Increasing spending levels doesn’t always fix problems. Always more consultants and middle level manager promotions available to sop up any new cash. But hey. The politicians (all of them) can all say that they have increased funding so they did their part. And with that you have Canada’s healthcare system in a nutshell.

Expand full comment

London Health Services in a nutshell. Except now there are fraud charge there as well.

Expand full comment

I read this line item in a list of federal government expenditures reported by David Clinton (The Audit) yesterday. Just one of 1200 items that deserve a close look:

“Contributions to provide income support to on-reserve residents and Status Indians in the Yukon Territory ($1.05 billion). Note that, as of the 2021 Census, there were 9,150 individuals with North American Indigenous origins in Yukon. Assuming the line item is accurately described, that means the income support came to $114,987/person (not per household; per person).”

It rather skews the national average a bit even though it’s a Territory not a province.

Expand full comment

That’s federal spending, not provincial.

Expand full comment

Indeed, which is why I qualified it. Nonetheless, it indicates the huge amount of government money that’s floating around out there that makes it difficult for anyone to comprehend the full picture.

A bit like the national debt; it’s often reported in terms of the federal number and fails to include the provincial and municipal numbers too.

I have no quibble with the accuracy of your figures. Your central point is well made. I am just saying that there’s unfortunately more to all this than meets the eye.

Expand full comment

Much of that is consumed the bureaucracy at the two federal ministries overseeing indigenous affairs, ministries completed devoted to maintaining the status quo.

Expand full comment

No, he pockets the money and endows his political allies. His cabinet is the most expensive Ontario has ever seen. Sorry, but Mr. Ford is a grand failure in my eyes

Expand full comment

But he will likely win the next unnecessary election in the spring. For a significant number of people the debt does not matter, nor do services, it is all about taxes.

Expand full comment

What makes Ford a poor conservative is not the spending, but the lack of a multi-generational arc of fiscal and institutional sustainability and stability. Responsible conservatives want a basket of services that are of moderate to high quality, invested in and nurtured with modest upkeep today so that we don't have unplanned emergency cash infusions later, or worse, institutional collapse and a revisionist thrashing-about by the electorate for something, anything, new.

Ford projects conservative but uses a gaudy neon sign to do so:

- slashing nurse and teacher wage increases, but in a reckless way that gets overturned, with interest and legal costs.

- projecting fatherly protection from crime while Ontario becomes one of the most risky places in the world to buy a pickup truck.

- investing in medical school spaces far too late to avoid a generational doc access bottleneck.

- paying the beer companies to end a contract early instead of waiting one year.

- direct cash payouts to voters - what more needs to be said.

Flitting about using wads of cash to fill hull leaks is too frenetic a governance model to be deeply conservative.

Expand full comment

Surely to goodness a “ multi-generational arc of fiscal and institutional sustainability and stability” starts with keeping control of spending.

Expand full comment

Nope. It starts with institutional stability. Responsible fiscal policy doesn't matter if the population can't get a doc. Our problems today are less fiscal than about valuing the institutions that glue us together, then funding them in a restrained responsible manner. A government that briefly spends above its means to maintain key institutions is more conservative than one that hollows out institutions but balances the budget.

Expand full comment

That is nice, because face it, no one likes paying taxes. BUT, everyone like to be able to go to the doctor in a timely manner. 20 to 25% of all Ontarians have no doctor. Out here in Kingston, a population of 130k people, 30k have no doctor, and almost all the walk in clinics have closed because they can not handle the load. I tried to go to 1 of only 2 I know of in Kingston last week and there were 10 people in front of me and I never got to the clerk because everyone was turned away. If you're not there by 11:30 am you can not be seen. I have tried to go to others but when you get there, there is a sign on the door saying no walk-ins.

No one smart enough to become a doctor and spend until they are 29 or 30 in school and come out with $500k in debt is choosing to be a family doctor because you simply can not make enough money to pay off your debt, buy a house, raise kids and save enough for retirement.

My wife has doctor in Toronto, I have a NP that I was lucky enough to get into see but it takes 30 to 40 days to see the NP. So forget about treatment for Lyme disease, found a tick 2 days ago, or for walking pneumonia, had to go to emerg for that, and really for anything else.

Yet Ford managed to cut $25B in yearly taxes over the last 6 yrs. At the same time he doubled his own pay and 88% of his MPPs are parliamentary assistants and he has the biggest cabinet in history so they can get an extra bit of money. How do you know you have not kissed enough butt? You are just a con MPP.

Then add it all the corruption with Ontario Place, the Science Center, the 413, the Green Belt and now tunnelling under the 401 for 60 miles,,,,, it starts to look very sketchy.

Is it cheap government? Yes clearly. Is it good government? Well I guess it depends who you know doesn't it. For anyone who needs services, it clearly is a problem.

To be clear, the problem with the doctors started 30 yrs ago under an NDP government run by Bob Rae but no one has ever even tried to fix it.

Prior to that it was the implementation of neo-liberalism and we see how that has gone as we race to the bottom. Look at the USA and Trump, which is about to quite quickly start circling the drain with all his appointments of incompetents to cabinet posts if you're not sure.

Trump has appointed a Russian mole, Tulsi Gabbard as U.S. intelligence chief, and an anti vaxxer to health and that is just the beginning.

Rather than buy our votes with license plate renewals, it would have been a lot better to give that money to family doctors.

Expand full comment

If Tulsi Gabbard was a Russian mole, the likes of you and me wouldn’t know anything about it. I don’t think you know what a mole is. You are just ranting.

Expand full comment

Tulsi Gabbard is considered by ANY informed security analyst, to be owned lock stock and barrel by the Russians. This information is easy to find.

Expand full comment

But that means she can’t be a mole if she’s out in the open. Kim Philby was a Russian mole in the British Secret Intelligence Service. He was a trusted public servant for nearly 30 years until he disappeared one day, having defected with his four henchman. He vetted physicist and Russian spy Klaus Fuchs for assignment to the Manhattan Project ensuring the Soviets would steal the biggest secret of the war. If he had been known to have been a Russian asset he would not have been able to do this, and wouldn’t have been working as a British spook, obviously.

So what ever else Gabbard is, she is not by definition a mole if little old you knows all about her from publicly available information.

Expand full comment

Hold on one sec, Ken. “same basket of government services”? Have you looked at our health care lately. Millions without a family doctor, 8+ hours wait time at the hospital emergency to be told you can’t get pain meds because he’s not your family doctor, months or years to get a hip/knee/etc replacement. How exactly is this the “same basket of government services”.

Pardon me if I throw this article in The Line’s “What the Actual Fuck” files.

Expand full comment

Show me (as in actual data) where Ontario is any worse than other province or I’ll treat this comment the same way you treat my piece.

Expand full comment

Sorry but your entire article reads like everything is normal. Saying that one province’s shitty services are cheaper than another province’s shitty service is a futile exercise. You should have made that stipulation at the very beginning. Btw Ken, impact big fan of yours, just not today.

Expand full comment

His big play was subsidizing media. Works like a damn

Expand full comment

I'm no expert on Ontario but I'm guessing that part of the reason Ontario doesn't have to spend as much as say Alberta or Saskatchewan is that to the Liberals, Ontario is a never ending source of votes and therefore receives the lion share of federal largesses. The prairies on the other hand are a source of revenue taken for granted that will never yield votes as so don't need the attention of this federal government. I may be out to lunch but that's certainly how it seems.

Expand full comment

Maybe read the piece. Ontario gets less federal money than anyone else.

Expand full comment

What about indirectly through Federal employment, Federal contracting and mostly Federal protection of the excessive profits and employment created by the media, telecom and financial services oligopolies?

Expand full comment

That data is not hard to find, but not relevant to the cost of service provision in Ontario.

Expand full comment

I’m a bit concerned with not having a handle on what the services that Ontario downloaded to municipalities amount to. This make interprovincial comparisons difficult I think. Big chunk of social service costs are now baked into municipal property tax in Ontario.

Expand full comment

Maybe read the piece. I deal with this explicitly.

Expand full comment

This ignores whether or not this is sustainable, or smart. Ontario hasn't found some magic ability to deliver better quality services for less money. Nor has it gone through the painful process of focusing public sector funding on things where it either can maximize the positive impact on citizens or areas where the private sector can't (or won't) step in.

In other words, I don't see a lot of evidence that we're more innovative in Ontario, or that we've prioritized better. What I do see is the classic approach of slowly starving existing programs while touting new initivatives.

I think Ontario was fortunate enough to have some institutional strength when this started in earnest, probably in the late-80s/early 90s. But, decades of governments (of all major parties) doing some version of "deferred maintainance" are having cumulative impacts. 2.5 million people in Ontario can't find a family doctor. A record number of school boards are running deficits a per-student funding hasn't kept up with inflation. And healthcare and education together are the majority of the provincial budget.

If I stopped doing any maintainance to my house, I'd probably find I had extra money each year and I'd probably not notice much difference for a few years. But, evenutally, weeds would be growing through a cracked driveway, the roof would be leaking, the water heater would stop heating and -- if left long enough -- structural issues might start to emerge. That's not wise money management! And, that's akin to what Ontario has been doing.

Expand full comment

It's almost like re-electing the same people over and over again, as the voters of Alberta and Saskatchewan have done for most of the past half century, results in really lazy and profligate governance. Weird.

Expand full comment

“Ontario today delivers health care, education, social services and all the rest of government for less per citizen than any other Canadian province.” Yeah, OK. Now, please compare the quality of those services. Paying less for less is hardly worth bragging about!

Expand full comment

Maybe. Maybe not.

I’ve done this analysis in a longer treatment of this issue (see link in my response to similar comments above) and found that higher spending does not mean better service.

Expand full comment

I’m enjoying the arguments against your position that consist of nothing but,, “Dougie’s a crooked idiot. Ontario’s efficiency can’t possibly be because he’s doing anything right.” You parry effectively. I’m going to read your longer pieces.

Health care is eating all of us alive. People in all the provinces complain about not enough free everything for everyone. It was a nice idea when we were young and healthy (and not fat and drug-addicted and mentally ill) with lots of workers to pay for it all. Now? Not so much. Managed decline is the best we can do anywhere where it’s all 100% paid for by a few high-income taxpayers. Medicare addicts will be voting Left until their dying days.

FWIW, I like Ford’s idea to tunnel under the 401 in Toronto. Lots of cities tunnel when it would cost too much to acquire surface land. What the heck are subways, then, if not tunnels? The whole point of a tunnel is that the land surface can be used for other things. Let’s do a feasibility study and cost it out. What is the cost of gridlock and congestion? And, Leftists/Ford-haters, don’t tell us that electric trains and transit will get people out of their cars and stop moving freight by truck. Ain’t gonna happen.

Expand full comment

A much more plausible solution to congestion than underground tunnels would be road tolls.

Expand full comment

Only if demand for road use is elastic enough to be reduced by the amount of the toll charge. The 407 highway in Ontario is uncongested most of the time because the toll is high enough to deter casual use. Business class for drivers, as it were. Free-riding traffic uses other (free) roads, congesting them.

If you tolled all roads, such as by chips in cars and trucks, you could set the toll high enough to discourage all driving that didn’t produce an economic return greater than the toll. So no more driving kids to hockey practice or dance class or driving the dog to the off-leash dog park. No more driving to babysit grandchildren unless the parents paid the toll for us. But then you might as well just raise the gas tax to $5 a litre. Easier to collect, and rewards good driving habits for better gas mileage. (Have to tax EV electricity, too.)

The two approaches depend on whether you want to suppress driving or encourage it. Building another road does tend to create trips that wouldn’t have happened otherwise. But is this a bad thing? It’s not like people just get in their cars and drive around aimlessly. They usually have some reason. I can’t see mass transit ever being “mass” enough in a dispersed society to get people out of their cars. There are commuters who drive from Mississauga to Durham without ever entering Toronto, much less coming near a subway line going even vaguely in their direction. Couldn’t see doing that myself, but people do. For those people, a toll just makes them poorer without “nudging” their behaviour in the approved direction.

And, in the end, voters can vote out governments who impose road tolls and gas taxes to punish them for driving. The voters can punish the government.

Dig, baby, dig!

Expand full comment

Interesting analysis, I learned something. That said cheques for every one just isn't conservative, it wasn't when Ralph did it, and its not when Doug does it. Its creeping UBI socialism and populist vote buying.

Expand full comment

Ralph bucks were issued at time when the debt was fully repaid and massive infrastructure projects were funded. The only alternative would have been to save the money, which would have become a target for the public sector unions and other Canadian governments. Ontario has massive accumulated debt, so the situation isn't comparable.

Expand full comment

Fair enough, not directly comparable, agree this is worse.

Expand full comment

I don't see any UBI here I only see graft and corruption. When was the last social housing built? Toronto shelters 12,200 people a night. The cost is astronomical. Now up to 80k a year. We could put them in some nice apartments for that.

Expand full comment

Do you think shelter denizens could manage in their own apartments without burning them down? We could let them sleep under bridges and take drugs for *less* than $80k. Maybe we should do that instead. Close the shelters and fire the staff.

Expand full comment

Do you think all these people got there by themselves. The government allowed Purdue Pharma to create millions of drug addicts, and then the government made rules that basically said, you can't have anymore and we are not going to help you with your addiction.

Then there are the people who are suffering from trauma and can not get any help. Lets not forget that an apartment now costs upwards of 30K a year, far more than minimum wages can allow you to afford. Once you are homeless it is almost impossible to get re-homed.

A little compassion and humanity would be in order.

We can go the other way and simply go to a pay as you go state. You are 100% on your own all the time. No state paid for fire departments or police. You get in a car accident and are trapped in your car, they come and give you an estimate to free you and it's cash right now or no help.

Is that the society we want to live in? Where we don't care about anyone but ourself and the people we happen to like a little?

A bit Dickensonian. I thought we had gotten rid of the poor houses and the debtors prisons.

Expand full comment

Where that argument goes off the rails (aside from the logical fallacy of the false dichotomy of a choice between an all encompassing welfare state and pay-as-you-go EMS) is in its presumption that if the populace isn’t sufficiently caring and compassionate, by God you are going to compel us to be. With force.

The reason we have fire departments is not really because we care if someone dies from smoking in bed. We just want to prevent his fire from becoming a conflagration that burns down a whole city of people who don’t smoke in bed. Similarly, I don’t care about the life of a drug addict. Everyone has an excuse and everyone makes choices. Programs for drug addicts should be judged if they get people sober AND if they don’t cause harm to others. Free apartments don’t seem to work well enough to justify the cost — nobody wants to pay for them except with someone else’s money. Safe(r) supply in safe(r) consumption sites prevents overdose deaths (sort of) but at the cost of attracting violent dealers and diversion of Dilaudid to the street in exchange for meth and fentanyl. This leads to addicted school children. I would gladly have 100 overdose deaths in addicts to prevent one school kid from being hooked. Therefore No to safe(r) supply no matter how many lives it “saves.”

Public services have to be looked at in terms of their costs and benefits to society as a whole, not just in terms of what squeaky wheel wants money. They should be more like the fire department and less like safe(r) supply and free housing. Remember, if you use land for free apartments, you can’t use that land to build normal apartments. That just keeps rents high from scarcity.

Expand full comment