The reason a global or national event is needed to justify this kind of expenditure on infrastructure is because you'll never get all three levels of government (plus international private sponsors) to fund a large scale project that is perceived to serve the interests of one particular community or area. Anyway, the facts on the ground are that governments aren't building places like Central Park anymore. Given the amount of groaning over projects like Boston's Big Dig, the public won't rally around a mass-scale project unless it has national and international appeal. The reason Expo 67 happened and is still celebrated today is because it was a watershed event in Canadian history, arguably the symbolic modernization of Quebec and Canada as a whole. It came about during the era of the TD Centre, the Quiet Revolution, the rise of Canada as a media centre, Centennial projects, the new Canadian flag, etc. Its construction coincided with and incorporated the construction of Montreal's subway system and the creation of the islands on which Expo stood. It allowed for the testing and creation of new transportation and housing concepts such as the monorail system and Safdie's Habitat. Canada found a new confidence and swagger that has had few iterations since (the 72 Soviet v. Canada hockey series, the back to back Jays World Series wins, the Olympic games in Montreal, Calgary, Vancouver, etc.). People can dump on these events for the expense, but really what do we look back on and celebrate in our shared history if not events like these? No doubt, some large scale projects, whether national or international in scope, are better executed and more worthwhile than others, which is why such undertakings are only worthwhile if the vision is right.
As for whether something on the scale of a Central Park is possible in this last blank slate on the waterfront, the Port Lands, I'd argue that we should shoot for something of that quality and approaching that scale, but distinctly Torontonian. A naturalized Don River should be its centerpiece. Corktown Common in the new Canary District is a good example of what's possible today for programming landscapes, except that it overlooks the train tracks. Imagine a much longer swath with more natural beauty. It will require a reimagining of places like the Leslie Street Spit and the Keating Chanel because the context will be very different from what it is today. I wonder if we could have a pedestrian bridge to Ward's Island? There are so many possibilities. The area is long enough to literally build a second downtown, the downtown we should've had if we committed to a more liveable civic vision early on and stuck to the plan. I agree that we've created barriers to the lake with the condos along Harbourfront, the elevated Gardiner Expressway, the above and at-grade train tracks, and Lakeshore Blvd. with its on/off ramps. Sugar beach is a better vision, but really the city needs a playground, and not just a big park that's an empty no-man's land with nothing around it. We have enough of those.