Chicago: The Privatized City of the Future

In December of last year, the city of Chicago pulled off a $1.2 billion sale of the city's parking meters. Information to the public was scarce until the deal was done -- the sale of this public property was rushed through the City Council in less than a week. A similar deal would've gone down last week had a $2.52 billion deal to privatize Midway Airport not been delayed due to financing details.

City assets being sold is nothing new in Chicago. Mayor Richard M. Daley has been hosting a city-wide garage sale since 2005, when he leased the Chicago Skyway, an expressway connecting the city to Northern Indiana, for 99 years. He's sold parking lots and trash pick-up service; he's even begun to privatize some of the police force, allowing an outside company to regulate traffic cameras and monitors.

Meanwhile, the city's operations are crumbling. The Chicago Transit Authority, for example, suffers from what they call 'Doomsday' scenarios every six months or so, where bus lines are threatened to be discontinued should funding not, somehow, increase. Last year, the CTA had to beg then-Governor Rod Blagojevich to bail them out. Had he not, thousands would've been scrambling to find new ways to get to school and work.

Yet as desperate as Daley's used-car salesman auctions are, they're also illogical. For starters, Chicago currently has one of the highest sales tax in the country. This is a mayor who, in the midst of this country's worst mortgage crisis ever, actually raised property taxes -- mere months after a re-election campaign where he vowed not to. So at a time when the city government and operations are doing less and less, people are actually paying more for it.

This, of course, is the dream of business-minded elected officials: the inverted funnel. Have boatloads of cash come in, and have none go out. Eradicate the idea of the public good. As Chicago sells off more and more, they'll be required to do less and less. Will there be tax breaks? More money for public welfare? Money to schools? Thus far in Chicago, those answers have been answered with a resounding "no."

Chicago should stand as a cautionary tale warning of the threats of municipal privatization. The parking meter deal gave Chicago Parking Meters (an entity that didn't exist before their bid was submitted, which raises eyebrows) rights to meters for 75 years -- like the Skyway sale, this takes any opposition out of the voter's hands for a lifetime. With citizen opposition out of the way, CPM has already doubled rates in most areas, and has plans to triple costs soon. There's also the question of finances for the city. In typical Daley fashion, there's been no transparency, allowing for speculation as to how Chicago will be receiving its funds. If the bulk of the $1.2 billion is paid, let's say, in the next five years, where does that leave city financing in 20 years? In 75?

Currently, Chicago is looking at an $82 million budget shortfall in 2009. Chicagoans should wonder what Daley's response will be if that debt registers any higher. What will he sell then? The schools? The police department? The United States has already seen private security forces surpass the military in foreign might -- it isn't absurd to believe the same thing can happen in cities across the country. This recession is forcing other municipalities to be creative in its methods for raising cash, quick. Luckily for them, Daley has publicly praised the benefits of privatization. According to him, "there's only so much a government can do." Such things being, for example, governing.

This recession shouldn't be a one-stop excuse for all of a municipality's financial woes. There's also the culpability for inefficient operations, and that rests on the shoulders of elected officials. Daley's short-sightedness gives him the here-and-now solutions he needs, without having to examine city malfeasance or waste in the slightest. Nothing will change fundamentally, which means the city will be in the same budget-crisis mess over and over again. That's why, long-term, it will be the taxpayer who will have to pay, just as they do now. The question is, if this trend of privatization of public goods continues, what exactly will they be paying for?

Comments

[Dr Manhattan]

The problem is Daley has been using the movie Robocop has a well for ideas on how to run a city.

[montemalone]

With all this privatization, when do we get to can some of the public servants that are no longer needed to do the jobs now being done by the private owners?
Just what are they doing all day?
Nobody ever talks about that.

[jsgaetano]

This is the issue which made me turn against Daley.

It feels to me like the City is handing it's legal authority over to private organizations which do not answer to the voters. Or even to the City, really- all rights and obligations are dealt with in the contract- just ask all these companies with outsourcing failures how well that works out.

Even more concerning to me is that while these deals may sound good at first, it ends up costing far more in the long run (as is typical of outsourcing).

This all really just smacks of fascism. Especially when you look at how Daley and his people not only aren't following the law, but they aren't even following the guidelines they've established for their own behavior.

[Michael Moreci - Huffpost Blogger]

Those are good points. What's even more concerning is that the alderman, most of whom are simply Daley's rubber-stamp committee, don't even seem to know or understand what they are signing away. Case in point, as the Reader's excellent Ben Joravsky made note of last week, is Alderman Mell from Albany Park. In response to being questioned about the parking meter deal and how the city would ultimately lose money in the long run, he said, "How many of us read the stuff we do get, OK? I try to, I try to. But being realistic, being realistic [his repetition, not mine], it's like getting your car insurance policy. It's small print, okay?"

If my car insurance were a billion dollar venture, I'm pretty sure I'd read, translate, and study ever word printed on it.

Who can really blame him though? Daley gave his council a whole two days to make their decision.

[dreadylocks]

Maybe a start would be to get some kind of state legislation putting a limit on how long the term of government contracts are.

[47th]

I have lived in Chicago all my life, and in the last fifteen years this city has become unaffordable for anyone who can't afford a five hundred thousand dollar condo.The privatization thing isn't working, the city is still broke. Daley has been mayor for twenty years and the problems this city has all are his responsibility! We really need a change!

[LeaderofMen]

Here's how bad it's become.

A few weeks ago I parked at a meter that was very plainly labeled as a 9am-6pm meter. I was there 15 minutes before 6pm. I fed the meter a quarter and got my 15 minutes.

I came back 2 hours later. There's a ticket on my windshield. It was an electronic one. Thus, everything was printed in ink. The ticket was time stamped for 6:04pm. I had been issued a $50 ticket for parking at a meter that was LEGALLY expired at 6pm.

I, of course, disputed the ticket yet haven't seen the resolution yet. But this is what it's come down to. Citizens are being harassed now.

I've been a Chicago resident for over 20 years. In all that time Daley has been mayor. For those two decades I've seen some spectacularly good changes come about. But it all started to come to an end around the time Stroger was appointed to the Chicago City Council. He's Cook County Board President and is the one who raised our county taxes to the highest in the nation.

So, a perfect storm has converged. Daley and Stroger are two ends of the perfect storm converging on the city. Chicago is no longer the city it was. Both of those men need to go and those who support them need to lose their jobs so we can sweep their failed policies away.