There is no hiding the fact the city of Toronto faces huge challenges. So does the province, the nation and, truth be told, most of the world. Even Mighty America has reached the end of invincibility, and perhaps, as of Tuesday, solvency.

And who needs to be reminded about Greece, Ireland, Portugal, Spain, Italy and the U.K, all tottering on the brink of collapse?

Around the globe, populations and their governments agonize and blame each other as the bills come due. But if those bills seem so much larger than expected, it’s because of our collective failure to understand the basic arithmetic of getting what you pay for.

How many times have we heard politicians promise lower taxes and improved services? Or say things like Rob Ford’s classic: “Toronto doesn’t have a revenue problem, it has a spending problem”?

Other than the fact they are nonsense, statements such as these are intended to keep the empowered masses in the infantilized state to which they have grown accustomed. The mature conversation we have been told must be initiated — about death, taxes and anything in between — has yet to start.

Instead, we resort to ideology, rhetoric, denial and the usual blandishments about tightening the belt just a little so that all will once again be fine.

In fact, the so-called developed world is reaching the end of an era that stretches back almost uninterrupted to the end of World War II. Huge social and cultural shifts lie ahead. Though we still rely most fundamentally on the assumption that economic growth will lift us out of the mess, even that can no longer be taken for granted.

Inevitably, the solution to Toronto’s woes — and those of other jurisdictions, civic and national — will be higher taxes, increased user fees (including road tolls, congestion and vehicle registration fees) as well as public cutbacks and private frugality.

Interesting that as the government deficits soar, so does personal debt, which has reached unprecedented levels in Canada. We’d rather leave it to government to practise what we preach.

Already Torontonians are asking whether the city really needs to own a zoo. Maybe not, but does that mean it’s a good idea to unload money-makers such as Toronto Hydro, Enwave, the parking authority?

The failure to consider tax hikes, however understandable politically, simply prolongs the problem. Indeed, it is the problem.

We like to believe we are grossly over-taxed, but that’s simply not the case. Toronto property taxes are the lowest in the GTA and, compared with income-tax rates in, say, the Scandinavian countries — 50 to 55 per cent, where we’d pay 35 per cent — we fork out relatively little.

For Toronto and all cities in Canada, the shortfalls are structural, built into a governance model that leaves them unable to raise the revenue required to provide the services we expect. This systemic discounting of urban Canada has been much discussed, but to little avail.

The idea of financing a big city such as Toronto on the backs of property owners no longer works. Canadian cities need a share of income tax.

That, of course, will never happen in a country where cities are considered junior partners. But as Jane Jacobs pointed out in her book Cities and the Wealth of Nations, it’s cities, not nations, that create prosperity.

“Distinctions between city economies and the potpourris we call national economies are important,” she wrote, “not only for getting a grip on reality; they are of the essence where practical attempts to reshape economic life are concerned.”

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That includes Toronto.

Christopher Hume can be reached at chume@thestar.ca