by Betsy J. Donald A thesis submitted in conformity with the requirernents for the degree of Doctor of Philosophy Graduate Department of Geography University of Toronto @ Copyright by Betsy I. Donald 1999 National Library Bibliothèque nationale du Canada Acquisitions and Acquisitions et Bibliographie Services services bibliographiques 395 Wellington Street 395, rue Welüngton OnawaON K1A ON4 OttawaON KlAW Canada Canada The author has granted a non- L'auteur a accordé une licence non exclusive licence allowing the exclusive permettant a la National Library of Canada to Bibliothèque nationale du Canada de reproduce, loan, distriiute or seU reproduire, prêter, distribuer ou copies of this thesis m microform, vendre des copies de cette thèse sous paper or electronic formats. la forme de microfichelfilm, de reproduction sur papier ou sur format électronique. The author retains ownership of the L'auteur conserve la propriété du copyright in ths thesis. Neither the droit d'auteur qui protège cette thèse. thesis nor substantial extracts f?om it Ni la thèse ni des extraits substantiels may be printed or otherwise de celle-ci ne doivent être imprimés reproduced without the author's ou autrement reproduits sans son permission. autorisation. ECONOMICCHANCE AND CITY-REGIONGOVERNANCE: THE CASEOF TORONTO Doctor of Philosophy 1999 Betsy J. Donald Graduate Department of Geography University of Toronto This thesis explains why the Toronto city-region underwent a policy transformation in its govemance structures, functions and jurisdictional boundaries between 1994-1998. What forces precipitated this change? How had Toronto earned its reputation as the 'city that worked'? Why did it stop 'working'? Are the policy proposais of the pst four years capable of resolving ernerging contradictions in the region's economic dcvelopment? These questions are explored in both an historical and contemporary context by drawing on insights of regulatory theory, urban regime theory, and an analysis of Canada's changing fiscal federalism. This approach infoms the role that institutions (regardless of origin or territorial scope) play in sustaining a local accumulation systern, and how this 'local' accumulation grounds a national regulatory mode and regime of accumulation. The approach also explores the relationship between regime and regulation theories in the context of policy formation and institution building. While postwar Toronto developed within a Fordist regime of accumulation, its elements of regulation at the city-region scale were distinctive. Toronto benefited fkom national regulatory policies, but its economic dynamism also constituted a comerstone of the nation's economic and social viability. Moreover, its localized regulatory structures had a unique institutional richness, which accornmodated many of the crisis tendencies felt by other industrial regions in the mid 1970s and early 1980s. Toronto's own 'stnictural crisis' did not fblly manifest itself until the late 1980s and early 1990s, when fiee trade, resû-ucturing, and other globalization forces emerged. These also influenced the policies and institutions of Canadian federalism, which affected the governance of Toronto. Institutions (such as 'Metro') that had regulated the city- region during the Fordist regime of accumulation were now implicated in its cnsis. This led to a demand for change in Toronto's govemance structures and functions. This study concludes that the policy set now being implemented is incapable of resolving the region's crisis tendencies. Policies of regional competition based on cost reduction clash with the quality-based strategy that was a comerstone of Toronto's past success. Notwithstanding extemal forces, the current policy set is not inevitable. Globalization does not predetermine al1 spatial-economic outcornes. f am deeply grateful to my Ph.D. supervisor, Professor Menc S. Gertler, for his support and direction throughout the doctoral program and in the preparation of this dissertation. He is an outstanding scholar and teacher and 1 fortunate to have worked with him. My inteliectual debt to him is evident throughout the following pages. I would also like to thank my committee memben for their ongoing interest and incisive comments: Professor Car1 G. Amrhein, Professor Gunter H. K. Gad, Professor Robert D. Lewis, and Professor Susan M. Ruddick. Professor Lany S. Boume and Professor Jim T. Lemon also provided direction on earlier versions of this dissertation for which 1 am very thankful. 1 would like to acknowledge the financial support of The Social Sciences and Hurnanities Research Council of Canada Doctoral Fellowship as well as the University of Toronto Connaught Doctoral Entrance Scholarship. The Department of Geography also provided me with research grants and teaching oppomuiities. In particular, 1 am grateful for the opportunity to have worked with Professor J. Robert S. Prichard in his capacity as Commissioner on the Golden Task Force. Thank you to the many policymakers, businesspeople, social activists and citizens who agreed to be interviewed for this research, to the helpful staff at the Metropolitan Toronto Archives, and to my colleagues for their wise advice. Finally, 1would like to acknowledge the support of my farnily, and in particular my parents, Jim and Marie Donald, who have always encouraged me to pursue higher education. Most importantly, 1 would like to thank my husband, Doug Morrow, whose unenhg love, intelligence and inspiration makes it al1 possible. Doug, you are wondefil. List of Tables and Figures ................................................... -vii- htroduction ................................................................. 1 . Theissue ............................................................ -I- The Setting ........................................................... -2- TheArgument ........................................................ -4- TheMethod .......................................................... -8- Economic Change and City-region Governance: Theoretical Underpinnings ............................................... 14- ReguIationTheory .................................................... -21- Regime Theory ....................................................... -34- My Approach ........................................................ -37- Toronto's Golden Age (1945-1989) What Made it Work for So Long? ........................................ -40- Introduction ......................................................... 30- The regulation approach and the Canadian context ........................... -43- The Toronto Area Economy in the Postwar (1 945- 1988) ...................... -47- 1945- 1964: Planning Fordism .......................................... -48- 1965- 1975: Full-swing Fordism ......................................... -65- 1 976- 1988: Unravelling Fordism ........................................ -85- What Made it Work ................................................... -98- Toronto's Economic Crisis and the Shattering of Regulatory Confidence (1 989- 1994) .................................... 105- Introduction ........................................................ -105- Features of Toronto's Fordism in Crisis ................................... 110- ConcIusion .......................................................... 134- Responding to Economic Crisis Exploring New Institutions for Greater Toronto ................................................... 136- introduction ........................................................-136- Setting the stage for governance review in the GTA ......................... - 1 4 1 - Provincial Response .................................................. -1 53- hterpreting the Changes .............................................. -1 84- Conclusion ......................................................... - 1 92- CHAPTER6 Conclusion ............................................................... -1 93- Tables and Figures ........................................................ -206- References ............................................................... -2 19- Appendix ................................................................ -233- LISTOF TABLESAND FIGURES TABLES Table 1 : Places of birth of Toronto immigrants 1996 (Toronto CMA) .............. 206 Table 2: Developrnent of public-sector planning activities in the Metropoliian Toronto Planning area, 1953and1957 ..................................................207 Table 3: Comparative economic statistics .Metro Toronto. Ontario and Canada, 1969-1974 .................................... 208 Table 4: Cornparison of unemployment rates: Toronto. Ontario and Canada, 1968-1975 ................................... -209 Table 5: Summary of the major elements of the mode of regulation operating at the city- region scale in Toronto. 1945- 1989 ..................................210 Table 6: Changes in responsibilities between provincial and municipal governments . 21 1 Table 7: Interpretations of recent govemance events in Toronto ................... 212 Figure 1: A graphic example of the changing industrial landscape in the Toronto region between 1932 and 1953 ......................... 213 Figure 2: Toronto's strategic location (1957) .................................. 214 Figure 3: Toronto's electric power at cost (1957) ............................... 215 Figure 4: Population growth in the Toronto region. 1945- 1953 .................... 216 Figure 5: The Toronto economic district (1 957) ...............................