Isn't it rather rare to find a city 'state' in isolation? There must be a need for some sort of hinterland, no? Otherwise, wouldn't NYC have ditched Albany and Buffalo a long time ago? L.A., California?
City states are certainly not unheard of in federations: Berlin, Bremen and Hamburg in Germany, Vienna in Austria, Madrid in Spain, etc. NYC had it's own statehood movement for quite some time. It seems much easier to create city states during periods of vast national transformation (like Berlin post-reunification, Madrid post-Franco) than it would be to shake up the federal structure once it's been well established (as in Canada, the US).
I would agree that Toronto needs far more taxation power and more proportional representation, not just in Queen's Park but at the federal level too... also, aside from PEI Canada's provinces are maybe a bit too large now that regions are developing, though I don't know that it makes much sense to chop up Ontario when most of the population are within spitting distance of Toronto anyway.
I agree. Ontario should devolve more powers to the City (or to some Metro-like pan-GTA body). The City of Toronto Act has certainly nudged us further along in that direction, and it is quite possible that we will (or should) see the Act further strengthened in the future.
There are certainly reasons why Toronto should remain in Ontario. For example, a huge chunk of Ontario's civil service is based here. We would not need to establish fairly expensive new bodies like a superior court, a securities regulator, a new health insurance plan, new student assistance plans, etc. The network of provincial highways and provincially-owned rail corridors through the GTA would not have to be chopped up and handed to their new, respective provinces.
And then there are fairly important questions that would need to be answered: how would a Province of Toronto be represented in the Senate? How would Ontario's debt be divided? Where would Ontario relocate its capital? How would a province whose economy is mostly based around services factor into equalization programs? How does the federal government become involved when regional transit becomes inter-provincial transit? Would a Province of Toronto maintain four separate publicly funded school systems? What protections and services would be provided to Toronto's relatively small Francophone population? What complications would arise for citizens looking to make the move across Steeles in either direction? Would they need to wait months to get new health insurance coverage? Creating a new province would certainly be a messy process.