Rahm Emanuel’s Tribute to the World’s Richest Man Is Bad News for Chicago

The city’s $2.25 billion offer to Amazon shows that the mayor puts the needs of tech profiteers over city residents.

Miles Kampf-Lassin November 3, 2017

Amazon Chairman and founder Jeff Bezos is currently vetting cities around the country, including Chicago, as a possible home for Amazon's new North American headquarters. (Photo by Scott Olson/Getty Images)

This arti­cle was first post­ed by Jacobin.

Amazon will not solve the problems facing any city, and certainly not Chicago.

Con­sid­er­ing the pow­er cor­po­ra­tions wield over the econ­o­my — choos­ing when to relo­cate jobs and where to stash off­shore accounts — we shouldn’t be sur­prised that cities across the coun­try are offer­ing mas­sive give­aways in hopes of attract­ing one of the world’s largest tech companies.

May­ors in forty-three states, along with Wash­ing­ton, D.C., and Puer­to Rico, want Ama­zon to build its new North Amer­i­can head­quar­ters in their own urban enclaves, so they’re ready to give the com­pa­ny bil­lions of dol­lars in tax cred­its and oth­er incen­tives. Stonecrest, an Atlanta sub­urb, even offered to rename itself Ama­zon and appoint CEO Jeff Bezos as may­or for life.”

These tax­pay­er-fund­ed sub­si­dies for high­ly prof­itable cor­po­ra­tions are known as cor­po­rate wel­fare.” Stud­ies show that state and local gov­ern­ments give away $80 bil­lion to cor­po­ra­tions every year, while fed­er­al sub­si­dies cost tax­pay­ers at least $100 bil­lion annu­al­ly. This comes on top of hun­dreds of bil­lions of dol­lars in tax breaks, mort­gage deduc­tions and oth­er hand­outs. It all adds up to a free mar­ket that costs the pub­lic a fortune.

Of all the brazen offers on the table, one in par­tic­u­lar stands out. Chica­go May­or Rahm Emanuel has put togeth­er $2.25 bil­lion in sub­si­dies to entice Bezos to open shop in the Windy City. Mean­while, he’s slashed pub­lic ser­vices and hiked taxes.

Just this month, Emanuel pre­sent­ed his 2018 bud­get, which includes addi­tion­al costs for rideshare ser­vices and a 28 per­cent increase in fees for call­ing 911. City Coun­cil mem­ber Car­los Ramirez-Rosa says the new bud­get nick­el-and-dimes work­ing-class Chicagoans while giv­ing the mayor’s rich and pow­er­ful cam­paign donors a free pass.”

These new tax­es come on the heels of the largest increase in prop­er­ty tax­es in mod­ern Chica­go his­to­ry. Anoth­er hike is slat­ed for 2020.

Since tak­ing office, Emanuel has imple­ment­ed new tax­es on water, sew­er, tele­phone use and garbage pick­up, to name but a few. Alto­geth­er, he has raised the cost of liv­ing for an aver­age Chica­go fam­i­ly by at least $1,700. Mean­while, he’s pri­va­tized more and more pub­lic ser­vices, from the pub­lic schools’ jan­i­to­r­i­al ser­vices to the Sky­way, the toll road that con­nects the city to north­ern Indiana.

Crit­ics allege that rais­ing bil­lions of dol­lars on the backs of ordi­nary Chicagoans in order to give it away to a pow­er­ful tech com­pa­ny is just the kind of cor­po­rate-friend­ly scheme that has earned Emanuel the nick­name May­or 1 Percent.”

It’s dis­turb­ing to see elect­ed offi­cials like Rahm Emanuel try­ing to stuff bil­lions more into Jeff Bezos’s pock­ets,” says Amisha Patel, exec­u­tive direc­tor of the Grass­roots Col­lab­o­ra­tive, a Chica­go-based coali­tion of social-jus­tice orga­ni­za­tions. Chica­go needs real solu­tions for work­ing fam­i­lies, not more lav­ish hand­outs to the ultrawealthy.”

Mise­d­u­ca­tion

How can a city that has to mas­sive­ly raise tax­es and fees afford bil­lions in give­aways? Accord­ing to Chica­go Teach­ers Union (CTU) Vice Pres­i­dent Jesse Sharkey, it comes down to priorities.

May­or Emanuel’s hypocrisy is over­whelm­ing,” Sharkey says, explaining:

Dur­ing his bud­get address, the may­or empha­sized that he was rais­ing tax­es to cov­er the true costs of city ser­vices, but Ama­zon doesn’t have to pay for the true costs of their new build­ing. The pro­posed mul­ti-bil­lion-dol­lar give­away reminds us that Emanuel cares about the rich and their down­town show­case at the expense of every­one else.

Sharkey knows a thing or two about how the may­or makes deci­sions. As vice pres­i­dent of the CTU, he helped lead edu­ca­tors in a his­toric 2012 strike. While the teach­ers came out on top in that fight, May­or Emanuel’s hand­picked school board closed fifty pub­lic schools the next year — the largest sin­gle round of school clo­sures in US his­to­ry. Soon after, the board enact­ed severe bud­get cuts and laid off a thou­sand employ­ees, tar­get­ing the union’s membership.

More recent­ly, reports have sur­faced show­ing that Chica­go Pub­lic Schools (CPS) CEO For­rest Clay­pool, an Emanuel appointee, cut the spe­cial-edu­ca­tion pro­gram bud­get by $29 mil­lion. At the same time, he’s try­ing to increase pay­ments to out­side con­sul­tants to a total of $28 mil­lion: almost enough to ful­ly restore spe­cial-edu­ca­tion ser­vices to the schools.

These cuts to pub­lic edu­ca­tion align with Emanuel’s broad­er pol­i­cy of hol­low­ing out pub­lic resources. Just after he became may­or, he shut down half of the city’s men­tal health clin­ics, help­ing to make the Cook Coun­ty Jail the largest men­tal hos­pi­tal in the nation.

Mean­while, Chica­go con­tin­ues to deal with hor­rif­ic lev­els of gun deaths, con­cen­trat­ed in poor com­mu­ni­ties of col­or. Amisha Patel con­nects this seg­re­gat­ed vio­lence to the city’s refusal to invest in these neighborhoods.

Chica­go has become a poster child of the dead­ly con­se­quences of this neolib­er­al approach,” says Patel. The com­mu­ni­ties that the may­or has con­tin­ued to dis­in­vest in are the same com­mu­ni­ties expe­ri­enc­ing high lev­els of violence.”

Such is life in a city with a neolib­er­al admin­is­tra­tion, hell-bent on recruit­ing the rich­est of the tech world while turn­ing its back on its own residents.

What Bezos Offers

What does Jeff Bezos, the tycoon who is mak­ing city lead­ers grov­el for the chance to become his new home, bring to the table?

Ama­zon claims that their new head­quar­ters will cre­ate 50,000 new jobs and bring in up to $5 bil­lion in con­struc­tion spend­ing. That may sound like a lot, but a clos­er look at what this devel­op­ment would bring tells a dif­fer­ent story.

With­out a trained work­force ready to take these tech jobs, they will go to trans­plants. One only has to look at San Fran­cis­co — a shell of its for­mer self, full of busi­ness­es and hous­ing devel­op­ments for the wealthy but lack­ing basic ameni­ties for the poor — to see what a tech-com­pa­ny par­adise looks like.

Fur­ther, a cor­po­ra­tion as vicious­ly anti-union as Ama­zon will ensure its new employ­ees remain unor­ga­nized and unable to col­lec­tive­ly bar­gain. And if work­ers try to union­ize? The com­pa­ny could just pack up and move away.

Once the new work­ers move into the city, long­time res­i­dents will like­ly see their hous­ing costs grow while fac­ing snarled traf­fic and increased con­ges­tion. The new head­quar­ters might dis­place long-term res­i­dents as the city becomes unaf­ford­able for any­one in the low­er eco­nom­ic strata.

None of these con­se­quences are like­ly to wor­ry Amazon’s cor­po­rate brain trust, how­ev­er. They are prob­a­bly too busy cel­e­brat­ing the Trump administration’s deci­sion to allow them to begin drone deliv­er­ies, a tech­nol­o­gy that will sig­nif­i­cant­ly reduce the company’s already pre­car­i­ous workforce.

Bezos, for his part, has his hands full count­ing his rich­es. He became the wealth­i­est man in the world after soar­ing stock prices net­ted a cool $9 bil­lion over the course of a sin­gle night.

Bezos’s $90 bil­lion nest egg speaks to the larg­er issue behind these offers: Why are cities scroung­ing togeth­er trib­utes for a com­pa­ny led by a mer­chant prince?

The answer lies with the log­ic of cap­i­tal. Free trade deals allowed com­pa­nies to move jobs over­seas in order to avoid labor and envi­ron­men­tal reg­u­la­tions, leav­ing Amer­i­can work­ers vul­ner­a­ble. As a result, cities across the coun­try have lost the indus­tries that pre­vi­ous­ly served as their eco­nom­ic engines. So, when a pow­er­ful cor­po­ra­tion like Ama­zon offers to revi­tal­ize an urban econ­o­my, may­ors jump at the chance, join­ing a race to the bot­tom that only ends in hol­lowed-out com­mu­ni­ties, gild­ed cities and multi­bil­lion­aire profiteers.

What Chica­go Needs

Ama­zon will not solve the prob­lems fac­ing any city, and cer­tain­ly not Chica­go. As Patel right­ly points out, Instead of mon­ey being invest­ed where it is need­ed, May­or Emanuel is choos­ing to divert resources to wealthy cor­po­ra­tions. What could our com­mu­ni­ties do with $2.25 billion?”

For starters, the city could reopen shut­tered men­tal health clin­ics and schools, ade­quate­ly fund pub­lic edu­ca­tion, pro­vide com­mu­ni­ty cen­ters and job train­ing, build pub­lic and afford­able hous­ing, sup­port free health clin­ics for the unin­sured or offer free ear­ly child­hood education.

As the Eco­nom­ic Pol­i­cy Insti­tutes Josh Bivens points out, the gains from smart invest­ments like ear­ly child­hood edu­ca­tion are more dif­fuse — they show up in thou­sands of kids doing a bit bet­ter through­out their entire school­ing and work­ing careers. But these lat­ter ben­e­fits are big­ger, and much more equi­tably shared.”

Such alter­na­tive uses for city funds are also being pushed by orga­niz­ers behind the #NoCo­pAcad­e­my cam­paign, which is seek­ing to stop the allo­ca­tion of pub­lic mon­ey for anoth­er one of Emanuel’s dis­put­ed new projects: a $95 mil­lion police and fire acad­e­my, to be built in a heav­i­ly African-Amer­i­can area of the city where, on aver­age, res­i­dents receive a pal­try annu­al income of less than $11,000 and 42 per­cent of house­holds live below the pover­ty line.

But these types of com­mu­ni­ty-cen­tered invest­ments have not been the approach of may­ors like Rahm Emanuel who would rather claim pover­ty until a cor­po­rate car­rot is dan­gled in front of their eyes.

As the CTU’s Sharkey puts it, Not just in Chica­go, but across the whole coun­try, the response of elect­ed offi­cials shows that they work for cap­i­tal, not for peo­ple. Politi­cians are chas­ing after the ulti­mate twen­ty-first cen­tu­ry sweat­shop like a bunch of slob­ber­ing dogs after a bone.”

Politi­cians like Rahm Emanuel may want to sell off pub­lic assets to the high­est bid­der and bow down to com­pa­nies like Ama­zon. But the bone they’re after will nev­er bring eco­nom­ic secu­ri­ty to those who need it most.

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Miles Kampf-Lassin, a grad­u­ate of New York Uni­ver­si­ty’s Gal­latin School in Delib­er­a­tive Democ­ra­cy and Glob­al­iza­tion, is a Web Edi­tor at In These Times. Fol­low him on Twit­ter @MilesKLassin

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