April 24, 2007
The City by the Lake in the New Economy
A piece that ran in Sunday's Tribune got us to thinking about the ramifications of last week's election here in Chicago. Much has been made about the significance of the nine new aldermen that will take office in May, especially those that had the support of labor. Dorothy Tillman, Madeline Haithcock, and Shirley Coleman all went down, beaten by union backed candidates. Toni Foulkes in the 15th Ward, an actual union member, beat Felicia Simmons-Stoval for an open seat in a ward that encompasses much of Englewood. In the municipal elections in February, Sandi Jackson took out Daley appointee (and daughter of William) Darcel Beavers, and Brendan Reilly ran Burt Natarus out of a seat, both with the support of labor. As Ben Calhoun points out, Daley's messy break up with labor is one of the few things he's not been comfortable with. The building trades unions, in particular, have backed the mayor, and it's been a fine line for Hizzonor to walk, courting big business while trying to stave off an onslaught of organizers, activists, and union members that were more than willing to knock on doors in neighborhoods where the the Machine has been substantially neutered by Patrick Fitzgerald.
But take a look at who replaced those nine aldermen: Bob Fioretti, a white, middle class attorney, Pat Dowell, a black, middle class woman, and Scott Waguespack, a white middle class law school graduate and public administrator, all replaced Machine regulars. This election, more than any other in the last 20 years in Chicago, was about class. As the face of the city has changed in the last two decades, a new set of priorities for ward residents has emerged. In gentrified parts of the city, loyalty, jobs, and power have become less important. Service, what the new middle class lives and dies by in the business world, has become the defining role of local government. In poorer wards, people are clamoring for opportunity - nothing new there. But as Laura Washington pointed out, if you can't deliver the goods, backing one of your own isn't a good enough rallying cry anymore. And why should it be? People in wards that haven't benefited from the global economy, that have been left out of this new global city that Daley has been building want a piece of the pie, too. Unfortunately, they have been offered nothing more than a few crumbs from the table, told to take a shitty retail job instead of a real future in one of the gleaming office towers downtown, or a good high-paying job with benefits working on some of that construction boom that feeds the new economy we've all been told so much about.
In many of these wards, (though not all, mind you), ward residents have begun to look very much like the growing gap between rich and poor in the US. As the middle class has shrunk nationally, beginning with the closing of steel mills and other manufacturing plants in the eighties, and now the vast outsourcing of tech jobs and other lower-middle class work to nations that pay far below what people earn here, we've seen a tremendous shift in both the type of work that people do, and the concentration of wealth that work generates. Scott Waguespack is an example of this change, and as Richard Carnahan summed it up so eloquently last week, the Ted Matalks of Chicago that the Machine produced are no longer good enough. Toni Foulkes, as well, is emblematic of this new Chicago: a city of college educated "knowledge workers" and the service sector employees that bake their bread. Is it any wonder that a union of janitors and nursing home workers would pony up over $2 million and hundreds of foot soldiers to take out aldermen that can't deliver a better life?
As the City of Big Shoulders puts on a tie and goes to work in an office tower or a hotel, a new group of aldermen will be heading to the city council. The question that remains unanswered, however, is how these new aldermen will manage their piece of a city that is caught up in such a far reaching economy.
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Nice job, Kevin.
>. Unfortunately, they have been offered nothing more than a few crumbs from the table, told to take a shitty retail job instead of a real future
Obviously for Kevin the solution is for the five year plan committee to mandate high paying jobs for poor people with no skills. That ought to do it!
Kevin, you seem to be alluding to the fact that this city is becoming more segregated based on class, which is true. So where are all the poor people going? The southern suburbs, interesting times.
Kevin, you seem to be alluding to the fact that this city is becoming more segregated based on class, which is true. So where are all the poor people going? The southern suburbs, interesting times.
Actually, Vinny, one of the solutions is to work harder so that poor and unconnected kids can get an education that prepares them for jobs that offer decent insurance and a chance at moving into the middle class. This should be a bigger priority for the Council than a local min. wage scheme that is better handled at state and national levels so that big companies have less power to play one city off another. And though our mayor has the right idea, he has done far too little for education during his tenure. By the way, I find your knee-jerk anti-Marxist screeching to be rather cute and relatively useless, almost like those old Cold War propaganda posters. But it does remind me of those Red Dawn days.
Nice post, Kevin. I don't agree with everything you say, but at least you are talking seriously about one of the important issues facing this city.
nice job kevin
Yes, it would be nice to see all that money TIF districts are siphoning away from schools put back in the classroom. Can we have a "TIF: Just Say No"?
Ah, yes, Red Dawn, the 1980s movie where the local football team defeats an invading Soviet Army.
The switch away from manufacturing and into "service," which is often just a euphemism for unskilled menial labor, might require some redefinition of who fits what social class. Not that those definitions were ever solid enough to please anyone, but a union plumber making $60,000 per year plus benefits is in a very different position from a data entry clerk making $20,000. Time was, when indoor work was "higher class." It looks to me as though the new economy includes shifts that require some rethinking of the traditional categories.
So much we could do to address the widening gap between rich and poor by ceasing to support programs that encourage centralization - such as changing the tax code to make a longer depreciation period on buildings (currently only 7 years, very much to the advantage of large corporations in distant locations). Or just cutting off the various corporate welfare programs, which disproportionately support the larger corporations.
Vice,
Sorry to interrupt the “We are so deep, we think about important problems” circle jerk by pointing out that Kevin's usual solutions are idiotic moral crusades that backfire. (i.e. proposals to mandate wages that drive business right out of the city).
And Thomas, why should the tax code discourage investment again?
I say this as a business owner who doesn't understand why the tax code provides disincentives for me to expand my operations, hire more people, make more money, etc.
We do a lot of bizarre stuff: leasing equipment we can afford to buy because leases are deductible immediately and computers depreciate over seven (does *anyone* want a 6 year old pc?) years. Buying cubes instead of offices because leasehold improvements have an insane deductible schedule. etc.
A lot of this idiocy gets started because people get it into their heads that "those corporations" are evil and need to be punished. Aim at foot, pull trigger, repeat. Watch business go elsewhere.
Awesome post Kevin. I worked with Tony Foulkes a few years ago and am a huge fan of hers. I think she will rise beautifully to the occasion. No pun intended.
Personally, I think all the alderman should get together for a nice game of kickball.
Great post, Kevin, but I have one question- I dont' follow you when you say (paraphrasing) that the Matlaks aren't good enough. Specifically as it relates to Matlak in particular. As Richard Carnahan pointed out, the 32nd ward is overrun with bad development that doesn't favor the residents already living here. The middle class is being phased out in favor of the type of wealth one sees in Lincoln Park. Your comment just confuses me, especially since earlier you comment that Waguespack is a "a white middle class law school graduate and public administrator"- that's certainly undeniable, but I'd argue that's not why he was elected. I'm fully willing to admit I'm wrong on this point, but from my seat, it looks like the ward was fed up with Matlak's blatant disregard of everyone who didn't fit that category, and that seems to be the thesis of Carnahan's article as well. Can you clarify?
Thomas Westgard, this old argument of punishing the rich because the poor is suffering has no merit. You basically saying if the poor are failing, lets make every once else fail. Instead of addressing what is the really issues, why some poor seems to stay poor, you want to destroy more rich people to make them more poor which will make every thing more equal. You really want to take money from people who wisely invests in capital and create more jobs and give it as a gift to people who will spend it on nothing that get them out of poverty (the teach someone to fish arguement). Businesses and the rich create jobs, unions and the poor don't. Things are fair, those who work hard get rich, those who don't get poor. That is a fact.
Why can not people enjoy the fruit of their labor? Rewarding people for being lazy and punishing those who are hard working is a bad fallacy. Why is it a taxi driver who is willing to work two shifts have to pay a higher tax rate than a lazy taxi driver who only works one shift. Now, you explain to me what is fair about a tax code that punishes a hard-working taxi driving to pay a higher tax rate than a lazy taxi driver?
We live in a very generous and great nation where hard working people have the ablity to be upwardly mobile. It might not be easy and most will never get the all the breaks but it does happen. Why do some believe that punishing a large number (the well-off, and believe me, it's a the majority of our population) to help a small number doesn't make sense. The hardest thing the poor have to overcome is people telling them this isn't a land of opportunity, their failure is someone else's fault, and they cannot succeed without help. Wake up and don't give me a one in million sob story.
Is there anything more annoying than a self-righteous trust fund baby?
Rich:
According to figures released by the U.S. Census Bureau in 2005:
13,360,273 people under the age of 18 live in poverty.
13.2% of all Americans are poor. As a percentage of all white Americans, 10.4% are poor. As a percentage of all African Americans, 25.6% (8,889,138) are poor. As a percentage of all Hispanics (9,315,923), 22.4% are poor.
In 2000, 12.4% (33,899,812) of all Americans were poor; in 2005, 13.3% (38,231,474) were poor. Total population in 2000 was 273,882,232; in 2005, it was 287,270,432. Our population gained about 13 million in five years, but our poor grew by just under 6 million. Clearly, our wise investors aren't creating all the jobs we need to keep people out of poverty, particularly not in the past 5 years, unless you want to assume that (excluding children) 25 million people are bone-ass lazy.
It isnt' wrong to assume that rich people work hard to earn what they have- with the exception of trust fund babies and lottery winners, they do work hard.
it IS wrong to assume that everyone had the same opportunities. Major disparities in education and home environment, for example, make the idea of a level playing field a myth.
Rich (well named):
According to figures released by the U.S. Census Bureau in 2005:
13,360,273 people under the age of 18 live in poverty.
13.2% of all Americans are poor. As a percentage of all white Americans, 10.4% are poor. As a percentage of all African Americans, 25.6% (8,889,138) are poor. As a percentage of all Hispanics (9,315,923), 22.4% are poor.
In 2000, 12.4% (33,899,812) of all Americans were poor; in 2005, 13.3% (38,231,474) were poor. Total population in 2000 was 273,882,232; in 2005, it was 287,270,432. Our population gained about 13 million in five years, but our poor grew by just under 6 million. Clearly, our wise investors aren't creating all the jobs we need to keep people out of poverty, particularly not in the past 5 years, unless you want to assume that (excluding children) 25 million people are bone-ass lazy.
As of 2001, over 1/3 of the nation's wealth was concentrated in the hands of the wealthiest 1% of the population. Corporate interests increasingly dictate government policy, both domestic and foreign, often at the expense of the middle class and the environment. We, the taxpayers, continue to subsidize big oil, even as they reap record profits and gouge us at the gas pumps. Our country's leadership is more emblematic of a plutocracy than a democratic republic...
I'm with rich. Where's the problem?
Vinny: You say you own a business, but you can't read?
Never said I agreed with Kevin. I am just glad he is raising the issue.
You might be surprised how business friendly I am, and prepared to be, especially in regards to this city and state (GRT?--no fucking way). But why can't one support businesses and good public education? Why can't one be worried about income and class gaps, especially recent trends in those areas, without all the dolts accusing me of being a socialist or --gasp--imply that one is a wanna-be Stalinist (who, you probaly know, is the guy who really had the first fun with 5-year-plans)? Are you really so simple minded?
Care to address that? Or would you rather keep ranting against the evil Bolsheviks as though you are about to shoot a Red to impress Jennifer Grey?
Vinny: I'm not sure what kind of "idiotic moral crusade that backfires" I'm on this time. It seems to me that most people that side with business tend to get uncomfortable when discussions of class come up.
Hey everyone,
Make sure you never work hard or try and make something of your life other than getting it through the government. If you do, all your white elitist "friends" on this blog will then hate you for being evil, because every single rich person in the world inherited their wealth, no one ever worked for it.
Let's go with socialism to make sure everyone gets the same amount. That will encourage people to work hard.
Vise, you are the one with the Red Dawn fixation. Some unfinshed business with the 1980s? I for one am done with the mall hair and shoulderpads.
The five year stuff is mockery through exaggeration, a common rhetorical tactic--one you are employing with the Red Dawn stuff.
Here it is with less rhetoric: When Chicagoist, particularly Kevin, gets into economic politics, it full of plenty of outrage but precious little understanding. It shows a belief that government can mandate prosperity. Just pass a law saying business should pay everyone really high wages (or give away high end cell phones for free yeserday) and sit back and reap the benefit. It doesn't work that way.
Both businesses and individuals respond to incentives. The response of business to state mandates is usually to leave for more favorable climes. Or to raise prices to cover the costs of these mandates. The consumer (or worker) loses in both cases.
There is nothing more pathetic than an aging hipster.
I'm assuming you meant, "hippie," dumbass?
In fact, business responds to stockholders first these days. There is a great deal of corporate welfare, some of it extorted through threats to pull up shop and go to China or some other place where low-waged, nonunion workers can be hired, and not infrequently, exploited. Municipalities, counties, and states frequently do not act on their "threats." Business has been ruling the day in America for quite some time, thanks in part to the politicians they "contribute" to.
Individuals do respond to incentives, but if they haven't got jobs, they can't be incentivized.
Vinny et al: Let's get a few things straight here. First of all, I'm not opposed to "rich" people, whatever the hell that means anyway. Secondly, I think you are reading a little too much between the lines on this post. I'm not advocating five year plans, government intervention, or some sort of grandiose mandate that is going to chase your little business out of the state or turn everyone into Bloshevicks.
In fact, while we're talking about passing laws that mandate higher wages, let's clear up another thing: I think that the labor movement has a much bigger calling to get out there and organizer workers, rather than try and morph into some sort of advocacy group that pressures government to legislate economic morality. What I find disturbing is not that Daley and his allies have opposed this ordinance, it's that they are offering poor Chicago residents the option of working at Wal-Mart, Staples, and Burlington Coat factory, and not trying to figure out how to force the building trades unions to accept more members from those wards. Shirley Coleman (16th), in particular, rejected "The Unions" when she was running for office. As Pat Dowell pointed out, these are people that protect and enhance jobs. Why wouldn't you want them in your neighborhood, especially when people in your own community could join those unions and benefit?
The bottom line here is that notions of class have changed exponentially in this city, and these new aldermen are reflecting that change. Bob Fioretti is the first white person to represent the second ward in 100 years and a Jewel bakery clerk represents Englewood. There was a time when working at Jewel wasn't as good a job as working in a factory or on a construction site. Now retail work is being sold by the power establishment as a way to "develop" those areas of the city that this economic "boom" has left behind. I wonder what happens to communities when everyone works at the Staples. Who, then, buys office supplies?
Whether the government mandates it, or people start to get organized and demand more for themselves, the bottom line is that in this election, what Chicagoans expect from their government has changed.
Kev,
It is striking that you show people as being prone, waiting for the government (sorry, power establishment) to bring them prosperity.
So the solution is to organize and demand that prosperity materialize?
I would take issue with your contention that lots changed with this election. What people want isn't some far reaching reexamination of Chicago's place in the global economy, but rather that they want is for their alderman not be a crook or an be an embarrassment.
Think so, Vinny? How about their mayor? Is it ok with them for him to be a crook (violation of Shakman Decree, just for starters)? Seems so, since he won. And these folks have been crooks and embarrassments for years (think Witchy-poo Natarus).
I think, Vinny, that corporate America's free grab in the grocery store is starting to come to an end, at least for another 20 years (these things cycle), and the business-first conservatives are in denial about it.
So I think I've got it.
The 1 million rich Americans are all hard working and deserving and only their money spends, hey those island vacations and tax shelters create jobs! The 37 million poor people in the U.S. are all lazy and even though they spend more money locally it doesn't count. Unh, yeah Rich (and friends) that makes perfect sense.
In China, they would think it is a great job and a good opportunity to make money compared to their standard of living.
Fredy, do you understand it is people taking risk that create businesses. The best way for an individual to be incentivized to create a business is not to taxed for all their hard labor. Unemployment is created when it is not economically feasible for business to return a profit. Taxes take away from making a profits. Hence, taxes causes some unemployment. It make sense that businesses that feel threaten would go some where where they do not feel threaten.
Rich - I guess that English is not your first language. Nothing you just wrote makes sense, though, even allowing for your imperfect command of the language.
I thought that is was a business's job to make products to make profits, not avoid taxes to make profits.
Vinny: You can jump up and down and huff and puff about government mandating good economic morals. I've made it clear, both in this post, and in others, that I think people need to make democracy happen in their daily lives, not wait for the government to legislate it for them. You can take issue with the contention that this election changed anything all you want; you'll be arguing with yourself, since I made no such contention in my original post.
Rich: Yes, your elementary economic analysis usually are correct: markets are elastic, but only to a point. If you push them hard enough, they will move, and sometimes that means unemployment, or jobs moving away. The problem with your economic analysis is that it portrays humans solely in the role of "Economic Man" mindlessly going wherever they can get the best deal. While it is true that some people operate that way, there are plenty more that would be satisfied to make a nice profit while giving something back to the community and making a product that makes people's lives materially better. Unfortunately, the cynical economic policies of the Reagan and Clinton administrations have exacerbated that problem.
My big problem with this whole arguement is that people want to punish the rich not help the poor. The rich are rich but the top 1% pay 35% of this country bills, the bottom 30% pay nothing in taxes. Is that fair??? With George Bush capital gain cut the govt is now collecting 98% more and the rich are reported 39% more taxable income. The rich are making more, paying more then they ever did because the taxes laws are making taking risk less risky and they are getting rewarded for doing so. If our local government learns not punish the market (business owners) companies will take more risk and employee more people.
K makes a good point, I don't think waguespack's positions were entirely off, but one thing that wasn't talked about in the campaign was what our neighborhood groups observed about matlak and his staff. At times, they seemed pained to even be in the same room as residents, and the condescending, "I'm the boss, screw you," Matlak attitude just did not sit well with people. You cannot stand around and act like a 1950's thug and think you are part of the community anymore.
Vise Beer 77
Because Vinny has already stated that he is not part of “the think deep about important problems crowd", I suppose it would be too much to ask that he give a few examples about said "proposals to mandate wages that drive business right out of the city".
But I'm sure he could give numerous Ronald Reagan style soliloquies about the amount of inner city welfare queens he’s encountered who drive Cadillacs and pay for steak with food stamps.
I also think that in the world of “rich”, a local football team from the heartland could’ve defeated an invading the Soviet Army, because this is AMERICA, the land of opportunity for any one who wants it!
I equally expect that Vinny and “rich” will not acknowledge our hipster/hippie/white elitist definition of “plutocracy”. Instead they will rely on their own definition of plutocracy, which is the combining of the ideologies of two vastly opposed but equally great American thinkers, Popeye the Sailor and Bluto.