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Just eight years after the end of the last century, it's clear that the word "urban" no longer means quite what it did. Indeed, for the first time in human history, more people now inhabit cities than don't. Canada is no exception.

"Canadians don't think of themselves as an urban nation," Miller notes. "But the fact is that we live in cities. The economic ingenuity of cities is what's going to lead us into the future."

But as Miller points out, we have a little governance issue here that we have yet to deal with; namely weak cities, a federal regime apparently unaware of them, and provinces with their own priorities.

"Politically," Miller continues, "cities in Canada don't exist, especially at the federal level. As far as I know, this is virtually unique in the world. Throughout the world, federal and national governments invest in cities, but we don't see that here. All cities in Canada are suffering from lack of federal spending."

According to Miller, "We have tied ourselves up in political correctness and NIMBYism. People have such a fear of change, but at some point things have to change."

The status quo, he warns, will lead inevitably to declining productivity and quality of life.

And while cities everywhere else are busy renewing themselves, Miller fears Canadians have grown complacent, taking the nation and cities' prosperity for granted.

"We need to develop a sense of urgency," he says. "Toronto is such a rich city, but we're not marshalling our strengths in an effective way."

At this point, Miller suggests, the best way to overcome inertia and get some momentum going is simply to pick a project and start.

Broadbent shows the shortcomings of the current model of large-city municipal governance, in which cities of millions of people, with complex social and infrastructure needs, are governed according to rules set out in 1867 when Canada’s largest cities were little more than towns. While there are many individual problems, such as revenue sources restricted to property taxes and fees, the crucial problem is that cities are entirely dependent on provincial governments for permission to do anything new in any field of activity.

This situation makes it impossible for Canadian cities to develop coherent, long-term programs and infrastructure to deal with the challenges faced by jurisdictions with millions of residents and billions of dollars of economic activity, because funding and powers can be arbitrarily changed or removed at any moment. The various current programs and proposals to “share” federal and provincial revenues (gas taxes, 1% of GST) are not much use because they can be taken away at any time, wrecking whatever programs were dependent on them. Broadbent argues

Control of destiny is at the heart of the new deal for cities. Cities need to be able to have a vision of their future, to create a credible plan to get there, and to implement the policies and programs that make that future vision a reality. (76)

People worry that cities would make mistakes, but, as Broadbent notes in a key passage:

The practice of provincial and federal governments treating city governments like children tends to make them act like children. And anyone who has raised children knows that they become responsible people by being given responsibility. (77)

It’s time that big city governments were allowed to take full responsibility for managing municipal issues as they wish, with all the risks and possibilities that entails.

The only question left is what role the private sector should play in the rebuilding process. Get used to it, Caplan warns. AFPs, as they're now called – alternate funding plans – are here to stay.

"The private sector isn't a magic solution," he admits. "It will never be involved in more than 15 per cent of infrastructure projects. But overall, AFPs cost less and can lead to innovation."

Although some have been dubbed failures, most recently Brampton Civic Hospital, like anything else, they can be done well or poorly.

OTTAWA -- The rate of return to businesses and individuals of government investment in infrastructure, such as roads, bridges and sewers, is at least as great as the government's cost of raising the funds for that investment, a new Statistics Canada study suggests.

"Public infrastructure, the roads and water and sewer systems that comprise the foundation of Canada's economy, provided a rate of return to public capital at least as high as the government long-term bond yield over the period from 1961 to 2005," according to a summary of the study, which estimated that return "centres" on an annual average of 17 per cent.

The findings support the case for more such investment, a labour economist argued.

"Although we also need interest rate cuts, there is legitimate doubt about how quickly lower rates from the Bank of Canada will translate into lower borrowing rates for consumers and businesses," Weir said. "In this context of financial uncertainty, direct public investment becomes even more important as a potential source of economic stimulus.

"Infrastructure investment would be a particularly effective type of stimulus because it would necessarily create employment in Canada," he added, noting the construction work would have to be done here and that many of the materials used in construction, such as concrete, would be produced here as well because it is impractical to import them.

The federation released poll results Tuesday that it said "shows Canadians overwhelmingly want the federal government to provide greater financial support to municipal governments."

"More than 90 per cent say the federal government should help municipal governments deal with infrastructure issues, a view shared across the country, including in Quebec and Alberta," the federation said.

The opposition Liberals also say the federal Conservative government should have spent most of last year's $10.2-billion budget surplus on upgrading the country's public infrastructure rather than paying down more debt.

Under the Liberal plan, any surplus greater than $3 billion -- which would be used for debt repayment if not needed for emergencies -- would be added to the $33 billion the government has already committed to infrastructure from 2007-2014.

While the author of the Statistics Canada report, economist Ryan Macdonald, said the study didn't attempt to measure whether there was a net benefit to government investment in infrastructure, it did stress the importance of such investment to the economy.

Tomorrow's report card comes two weeks after Canada's largest municipalities reported that incomes are not keeping pace with the rising cost of housing and called on Ottawa to craft a national plan.

Under the 2001 federal-provincial housing deal, Ottawa agreed to spend $680 million over five years if the provinces matched the federal funds. Ottawa added $320 million in 2003 and brought the total federal-provincial funding promised to $2 billion.

But federal-provincial spending data collected by the Wellesley Institute shows that spending on housing in 2007 was roughly the same as in 2001. (This doesn't include a one-time $1.4 billion federal payment to the provinces in 2007, the result of a deal struck between the previous Paul Martin government and the NDP to ensure passage of the 2005 budget.)

"This means that, across the country, instead of a net new $2 billion in housing funding, as promised in 2001, any new housing funding has either replaced previous dollars or not even been made," the report says.

Wednesday's meeting is the first time in more than two years the housing ministers have met. Federal Human Resources Minister Monte Solberg has not yet confirmed his attendance and if he doesn't show up, it will be the first time in almost a decade that Ottawa hasn't been represented at such a gathering, Shapcott says.

During the last provincial housing ministers' meeting held outside Halifax in 2005, Ottawa and the provinces agreed to work quickly on a national federal-provincial housing strategy with goals, timetables and long-term funding.

Little has happened in the interim. As a result, all current federal housing programs are set to expire by March next year.

This week's meeting comes in the wake of last fall's fact-finding visit by the UN's Special Rapporteur on Adequate Housing, who called on the federal government to work with the provinces to implement and fund a comprehensive national housing strategy to meet the housing needs of Canadians.

Canada is the only major country that doesn't have a national housing strategy, the report notes.

Against great odds and in the face of trenchant hostility, the amalgamation of seven governments into one unified Toronto has survived its first decade. Barely.

Happy anniversary, megacity.

Never has a forced union been so universally detested and excoriated – every outflow, offspring or offshoot smeared with the "bastard" tag: unwanted, unloved, unappreciated. And yet, alive, if not well.

Some wounds are only now healing, 10 years later. And considering what it's been through, it's a miracle Toronto is still standing.

"It's been a real body blow to the city," says Sewell, still defiant. "I fear for the city's future."

"A disaster," adds MPP Michael Prue, East York's last mayor.

Kathleen Wynne, now education minister, was Sewell's right-hand person back then. Her analysis? "I've knocked on tens of thousands of doors since I got into provincial politics, both in 2002-2003 and 2006-2007, and I have yet to meet anyone who says they think the amalgamation of the city of Toronto was a good idea ... Maybe that's a lie. Maybe I've met two people."

The idea did not infuriate everyone. Opponents hiss that the newspaper editorial boards and many other media were in favour. But others, like ex-mayor David Crombie, also saw value in it.

Proponents viewed amalgamation as part of a normal evolution that reduced the Toronto area to 13 municipalities by 1953, six by 1967. Others suggested one big Toronto would provide a citywide equity of services otherwise missing.

The province's position was that huge savings would be exacted. But once the entire Harris plan was unveiled – amalgamation plus a huge download of social services and an end to transit funding – opposition was cemented.

The city talks of Queen's Park owing it $700 million to $1 billion. On the other hand, it got a $1 billion asset in Toronto Hydro, and the province took on $600 million in education costs.

What is irrefutable is that the city was set on a path to fiscal failure. Amalgamation was supposed to deliver three main benefits: savings, greater equity and more clout.

"Savings" were wrung from the system, all right: thousands of jobs cut in the first three years. But that wasn't sustainable. At the same time, more staff were hired for police and transit to cope with growth.

On equity, the megacity has been a big success, spreading the social safety net across the city. York, the poorest of the old municipalities, has benefited most.

But as an experiment in local democracy, merger has been a huge failure. The megacity's continued survival is a testament mainly to the efforts of a great civic workforce. Its creation was too hurried. Too much was heaped on its head.

What now? Do we de-amalgamate, as the school board is now pondering? A few diehards have always harboured such thoughts. But the former mayors and Metro chairs, except Prue, say going back is not an option. Better to have the province fix the fiscal mess by taking back social services costs and giving Toronto some breathing room.

Mayor David Miller has staked his own political survival on the province riding to the rescue.

If culture really is a driving force behind the economic development of Montreal, as Premier Jean Charest claimed yesterday, it is about time the city, province and federal government put real money into it.

The news that Montreal's Quartier des spectacles is to receive $120 million from the three levels of government should be applauded.

As potential cuts to services loom large at city hall, community groups are mobilizing to fight back.

People for a Better Ottawa is a new coalition of community groups and individuals that will be launching its campaign today at the Jack Purcell Community Centre.

"We want to build a consensus that we need to build a balanced approach for the budget, that includes investments in social health and arts programs and services," said David Robbins, launch organizer. "I think that a lot of councillors would agree that there is not a lot of fat left to cut."

The coalition is composed of groups representing arts, culture, students, communities and others.

The coalition wants to work with the city to lobby the province for more money for issues such as infrastructure and services previously downloaded by Queen's Park.

However, getting money from the province is never certain, and Robbins said his group would be willing to advocate on behalf of a property tax increase as part of the solution.

"We need to improve and strengthen services, find other solutions for revenue that don't require contracting out or privatization and build on services for the long term," said Robbins.

These are the factors that are starting to drive businesses, employees and infrastructure to places such as Richmond, Surrey, Langley and Abbotsford. In the recent economic boom, jobs in Vancouver are growing at less than 2 per cent, compared with 10 per cent for Metro Vancouver's 21 municipalities. Combine all this with downturns in the export industry from the rising dollar, and it spells trouble for this growing city.

In the VEDC report, business and community leaders speak about a hollowing out, the prospect that Vancouver could be a bedroom community enjoyed by the wealthy, owned by absentee condo owners who prefer to do business elsewhere.

How will Vancouver keep businesses from voting with their feet, and taking their jobs and tax payments - and thus quality of life - with them?