Readings: Carlo Fanelli: Megacity Malaise: Neoliberalism, Public Services, and Labour in Toronto

Carlo Fanelli, Megacity Malaise: Neoliberalism, Public Services, and Labour in Toronto, Fernwood Books, 2016.

Although the basic driver of capitalist society is easy enough to understand, its system-need to turn money-capital  into more money-capital manifests itself as a series of intersecting contradictions: political, economic, social, and cultural.  These contradictions affect different regions of the globe and different groups of people differently.  In Guangzhou, China, the destruction of the industrial working class of Southern Ontario and the US mid-West is experienced as the birth of an industrial working class, with all the pain and promise that process entailed in the West one hundred and fifty years ago.  In the world’s ever larger megacities, the loss of manufacturing has been off-set by the explosion of finance and cultural industries as the main drivers of capital accumulation. Cities too small to act as a magnet for finance capital and cultural industry monster-spectacle are left desperate and dependent.

The contradictions of twentieth and twenty-first  century capitalist urbanization provide the socio-economic frame for Carlo Fanelli’s political analysis of labour struggles against austerity in Toronto.  While a mid-sized city by global standards, Toronto is by far the dominant city of Canada, with a metropolitan population bigger than Montreal and Vancouver combined.  As the mass culture and financial centre of Canada, Toronto is a a global city which sees itself (and not incorrectly)  as a key competitor with New York and London.  In the contemporary world, inter-national capitalist competition increasingly plays out as competition between major cities.  Finance capitalists and the captains of the culture industries are the winners, peripheral cities and  workers across sectors are the losers.  Yet, as Faneli shows, despite being obviously the victims, workers, and especially unionized workers, are blamed as the cause of their own demise.

Fanelli is uniquely positioned to both explain the socio-economic context of labour struggles against austerity and critique the limitations of their existing forms.  As a working class child and adolescent growing up in Rexdale he learned first hand the range and the importance of the public services the city offered.  After having benefited from those services growing up, he later helped to provide them, working for many years for the City of Toronto in different capacities.  During his career he was also an an activist member of the Canadian Union of Public Employees Local 79– the largest union of municipal workers in the country.   He is also a political economist with a gift– due to his not having forgotten his working class background– for bringing complex economic problems down to their real world implications for working people.  Although the book focuses on Toronto, the lessons he draws are of general significance to Canadian public sector workers.

The book is admirably concise, managing in 100 pages to provide a brief constitutional  history of the status of cities in Canada, the global socio-economic causes of neo-liberalism and the austerity agenda, the local contours of those causes as they have shaped the political agenda of Ontario and Toronto over the past twenty years, an ethnography of two pivotal CUPE strikes in Toronto, a critique of the political limitations of the CUPE Toronto leadership, an affirmation of the public sector as a counter-weight to capitalist market forces, and general ideas about how that counter-weight can be used as a platform for the development of renewed union radicalism and anti-capitalist mobilisation.  Despite the number of foci, the book reads as a unified whole.  Theoretical claims are empirically substantiated. There is no extraneous detail, but the reader wanting more fine-grained content is always pointed to the primary sources.  The book needs to be part of any conversation around the political re-birth of the union movement and the re-invention of the Canadian left.  In that regard it could usefully be read alongside of Alan Sear’s The Next New Left.

Fanelli begins with a cogent explanation of the causes of the austerity agenda in Toronto.  These causes are both general and specific.  The general cause is the global reign of neo-liberal orthodoxy, according to which unions and the public sector have undermined the competitive dynamism of capitalism and slowed economic growth. Hence the goal of neo-liberal policy has been to weaken unions and privatize public services.  The tactic is the same everywhere:  first tax cuts create a revenue crisis, which leads to service cuts, which are blamed on workers high salaries and secure pensions, which are used to demonize workers, eroding public support  for job security and living wages at the same time as it increases popular support for state-led attacks on public sector workers.  “This is a recurring feature of neo-liberal administration in which tax cuts are firs used to degrade the quality and breadth of the service provided, which governments then invoke as justification for “tightening spending.”  When this fails … this manipulative strategy is then used to justify privatization.”  (p. 41)   Fanelli explains the logic of manufactured crisis clearly, substantiates his analysis with concrete examples from Toronto, and avoids repeating at length the historical development of neo-liberalism already well-analysed in works like Harvey’s Neo-Liberalism:  A Brief History.

The specific cause of the austerity agenda is the  constitutional status of cities in Canada.  Fanelli weaves his way through the relevant constitutional arcana to explain the core problem:  According to the British North America Act (1867)  and the Constitution Act (1982), cities are the creatures of the provinces with very little room for independent fiscal maneuvering.   Overwhelmingly, cities rely  on property taxes to raise the revenue they need to pay for public services.   Property taxes, are, however, regressive:  if home value rise property taxes will rise, but there is no guarantee that wages will rise in lockstep with property taxes.  In booming real estate markets working people, whose wages have been suppressed over the last three decades, can find themselves with a growing tax bill–  and moved by the resentment higher taxes and more or less fixed incomes  to set out looking for scapegoats.(p.33)  Right-wing politicians are happy to point them in the direction of public sector workers grazing by the side of the road.

These general and specific causes have combined with a series of disastrous (for cities) provincial decisions, beginning with that of the hard-right government of Mike Harris (1995-2003) to download significant new costs to cities (public housing, social assistance …),  without any corresponding increase in their ability to borrow or otherwise raise revenue in new ways.  Although a right-wing ideologue of the most objectionable sort, Harris was simply mimicking what his supposedly progressive federal Liberal counterpart, Jean Chretien, through the agency of then-finance Minister Paul Martin, was doing to “solve” the deficit crisis:  download costs to the provinces.  Martin set in motion a vortex of downloading at the bottom of which is the political unit least able to fiscally cope– cities.  Since most of the services that people depend upon for the day to day quality of their lives are delivered and paid for at the municipal level, the overburdening of city budgets by these newly imposed costs was felt in a very real way, especially by the poorest and most vulnerable:  fewer services,  higher user fees, and more encouragement from politicians for them to take their anger out on the workers who deliver the services.

Toronto city governments from the reign of clown the first Mel “Bad Boy” Lastman to clown the second Rob “Real Bad Boy”  Ford have claimed that Toronto faces a spending crisis.  But professional audits have revealed that the city is and has been very well-managed from a spending perspective.(p.26) The real problem, as Fanelli demonstrates, is “a revenue crisis rooted in the constitutional constraints of municipal government and public policies of the neo-liberal era.”(p.3)  However, failure to recognize the truth of the political economic situation has led the public to support, to various degrees of intensity in different periods, the overall program of “competitive austerity” successive governments have recommended.  Fanelli refers to Greg Albo to explain competitive austerity as a set of policies which makes “labour markets more flexible, enhances managerial prerogatives, reduces government services that act as a drain on competition, shedding public assets and weakening labour laws and employment standards, aiming to turn the state into a series of internally competitive markets.” (p. 28)  The program of competitive austerity can only be realized through the defeat of organized labour, since the entire point of organized labour is to shield workers from the life-destructive effects that unregulated market forces generate by pushing down real wages.  If competitive pressure increases, then the power of unions must  proportionally decrease.  Hence we would expect a period of competitive austerity to be a period of class struggle in the form of public sector unions trying to preserve past gains against cost cutting municipal governments.  That is exactly what we find in Toronto.  Its CUPE locals (79 and 416) have been involved in work stoppages in 2000, 2002, 2009, and 2012.  The results, as Fanelli explains, have not been catastrophic for CUPE, but they have been defeats.

The most important contribution the book makes is its political analysis of these strikes and the lessons for the future development of the union movement.  Fanelli is fair (and not out of loyalty to his CUPE brothers and sisters).  The bargaining situation for all unions in the context of competitive austerity is extremely difficult.  Anyone who thinks sloganeering or sideline invocations of the need for militancy can overcome these objective barriers to success simply has not been involved in union politics for the past thirty years.  There are reasons why concessions have been made: the increased mobility of capital has put workers in competition with each other, internationally, nationally, provincially, and between cities.   While public services are not subject to relocation in the same way a car factory is, private sector dynamics, as Albo noted, have been replicated in the public sector, weakening unions’ bargaining strength.  At the same time, legislative changes (making the use of scabs easier, declaring more and more workers “essential” in order to strip them of their right to strike) have coalesced with competitive pressures to objectively weaken the labour movement.  The objective forces have subjective implications:  workers feel beaten down, targeted, worried about job security, and thus defensive.  Mobilizing militant action in this context is extremely difficult.

Difficult as it is, it is also necessary (if the competitive austerity agenda and, beyond that, capitalism itself are to be eventually overcome).  Fanelli acknowledges the challenges, but he also (hopefully, not naively) teases out the possibilities for union renewal in the unique role public sector work plays in a capitalist economy.  As Fanelli notes right at the outset, public sector work satisfies real human needs, and in so doing, improves the lives of those who access those services.  These needs run the gamut from basic physical needs like health care when sick to socio-cultural needs like engaging in organized play and education.   Thus, the first step in recreating a fighting, progressive, and democratic trade union movement is for public sector workers to connect the life-value of the services to the workers who provide those services:  “The public provision of goods and services, well-managed in a way that fosters sustainable development and social justice initiatives, and which is accountable to the community, significantly improves standards of living …  It is necessary to ensure that the public at large understands this through community engagement initiatives led by unions.” (p. 86).  “Sustainable development,”  “social justice”  and “accountability” all need to be more clearly defined, but the general point that Fanelli makes is sound: the public sector constitutes a counter-logic to the money to more money sequence of value that determines the capitalist economy.   Its principle is: satisfy human needs regardless of ability to pay because good human lives demand need-satisfaction.

Of course, this principle exists in tension with the driving force of money-capital accumulation in capitalism.  Fanelli acknowledges this fact:  “”Public services address real needs and result from previous rounds of class struggle, but they also address the need of the capitalist state to reproduce class society.”(p. 83).  Moreover, public sector workers can often also stand in relations of power over and against the communities they serve, often in racialized and sexist formations (welfare case workers vis-a-vis their clients, for example).  Overcoming the later contradiction requires building alliances and coalitions with communities, while the former requires defending, extending, and democratising public services; a reverse process of publicization against the privatizing agenda that has dominated over the past thirty years.  That campaign requires militancy, and militancy requires education and member mobilization. “Considering the concerted attacks against labour, should unions wish to regain their once prominent role in the pursuit of social justice and workplace democracy, they will need to take the risks of  organizing working class communities and fighting back … This requires a radicalized perspective that seeks to develop both alternative policies and an alternative politics rooted in class-oriented unionism.”(p. 61)  It should be added:  it will also take a new layer of younger leadership educated in the history of militant trade unionism while attentive to contemporary realities and open to and capable of inventing creative responses appropriate to the twenty-first century.   One worries (or I do anyway)  that the culture of expressive virtual individualism works against the emergence of such a leadership layer.

Nevertheless, it would be foolish and ahistorical to simply abandon the union movement as a potentially transformative movement while it still organizes millions of workers (and especially the public sector union movement, where union density is far higher than in the private sector and where the services the workers provide must be fixed in local space).  As long as there is a union movement, it needs spurs to reinvention such as Fanelli has written.  Still, arguments like Fanelli’s are always subject to the objection that despite their forward-looking rhetoric they are rear-guard actions whose conditions of historical possibility have passed.  The only sound response to the objection is practical success, for which the author cannot be held responsible, since success will require contributions from thousands of people acting politically over open-ended time-frames.

At the level of argument,  Fanelli’s set of reform principles:  coalition building, community engagement, internal democratization,  and member education steered by the goal of preserving public services and extending the logic of public provision are sound and what one would expect.  There is one blind spot that is worth mentioning.  In Fanelli’s version of cities, what makes them great is the range and depth of public services available to citizens.  I agree without reservation, but would venture to add that the cultural and intellectual dynamism of great cities needs to be included.  Fanelli is largely silent on the cultural wealth of Toronto:  its bands, performances, public talks; its eccentrics, artists, and folk heroes, its neighbourhoods, galleries, universities, clubs, restaurants, and book stores; its magnificent cultural, intellectual, and sexual diversity.  Unlike David Harvey (whom he cites)  Fanelli’s version of the “right to the city”  is largely confined to affordable housing,transit and other (vitally, vitally important, no doubt)  basic human needs.(p.78).

But human beings are creatures of mind and imagination too.  The right to the city must also include the right to access the extraordinary cultural (and intercultural) dynamism of the world’s great cities.  Often times the barriers here are not financial, but cultural:  the snobbery and closed-mindedness of cultural elites who often (although not always) function as gate-keepers to these institutions and events.  Working people are often made to feel as thought they lack the “symbolic capital”  to borrow a phrase from Bourdieu, to take advantage of cutting-edge art and thought that cities incubate and nurture.  And that is wrong, for art and thought are not the preserve of financial and cultural elites but should be open to everyone.  The left needs to extend its historical commitment to egalitarianism beyond access to the requisites of life to the requisites of a liberated mind and imagination.

The modern city is certainly a creature of capital, but it is also a creature of human labour and human imagination.  Great cities have long been attractors of genius and eccentricity and spaces where difference can be protected from bigotry by force of concentrated numbers of the like-minded and tolerant and experimental.  Cities are contradictory spaces just because they concentrate in a relatively small geographical space the most inventive and forward-looking human beings with the most brutal indignities that capital can inflict.  The struggle for the city must be a struggle to overcome the structural causes of those dignities, but also a struggle to open the horizons of working people to the creative and intellectual wealth that already exists.  Beyond opening up access to what already exists, a re-vivified struggle for the right to the city must also be a struggle to widen and deepen that wealth by enabling people to live as subjects of their own activity and not objects of money-capital.  Fanelli has written a short but important intervention into the debate over the shapes that that struggle should to take.