An article in The Wall Street Journal discussed attempts to merge local governments in Michigan. While efforts such as these gain wide support because of the belief that they will save money, there evidence shows the opposite.
Government consolidations may seem to make all of the sense in the world academically. In practice, they cost more. There are no economies of scale in larger governments, except for spending interests. Voters have less influence in larger jurisdictions.
A simple look at the evidence, rather than the theory, indicates this. Our analysis in five states shows it, and the differences are stark. Lower per capita spending and taxation at the local general government level is associated with smaller units of government.
It is not therefore surprising that in Toronto, Hamilton and Ottawa there have been calls to "demerge" cities forcibly merged in the 1990s. In a debate in Toronto last October with a top transit official (a member of the left leaning National Democratic Party), we agreed on at least one thing --- that Toronto's amalgamation had been a mistake.
Nor is it surprising that despite huge electoral barriers erected by the Charest government, a number of municipalities voted to demerge from the forcibly enlarged ville de Montreal in the early 2000s.
For the most part, however, there is no going back. Mergers are forever. So are the higher taxes and higher spending.
My commentary in Canada's National Post dealt with this issue on the 10th anniversary of the Toronto amalgamation.