python logging - how do I truncate the pathname to just the last few characters or just the filename?

You'll have to implement your own Formatter subclass that truncates the path for you; the formatting string cannot do this:

import logging
import os

class PathTruncatingFormatter(logging.Formatter):
    def format(self, record):
        if isinstance(record.args, dict) and 'pathname' in record.args:
            # truncate the pathname
            filename = os.path.basename(record.args['pathname'])
            if len(filename) > 20:
                filename = '{}~{}'.format(filename[:3], filename[-16:])
            record.args['pathname'] = filename
        return super(PathTruncatingFormatter, self).format(record)

Use this class instead of the normal logging.Formatter instance:

formatter = logging.PathTruncatingFormatter(
    '%(asctime)s - %(pathname)86s - %(lineno)4s - %(message)s', '%d %H:%M'
    )