Welcome to Issue #14 of the Red Star Bulletin!
The aim of this bulletin is to bring Chicago Democratic Socialists of America members a regular round-up of important legislation, committee meetings, and other updates from City Hall, as well as analysis of what this means for our organizing as socialists.
Make no mistake: the City Council is not friendly terrain for us. We must first and foremost continue to build power in the places it derives from–our workplaces, our neighborhoods, and the streets. But we hope to give CDSA members information they need to assess the electoral project we’re embarking on, and to continue building it into a powerful vehicle for working-class politics in our city.
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Since the news first broke last summer that federal authorities had raided the home of a ComEd lobbyist and close confidant of Illinois House Speaker Michael Madigan, we’ve seen bits and pieces trickle out about a major scandal involving the most powerful politicians in the state and Illinois’s most powerful corporation: Exelon, the parent company of ComEd. This scandal reached a new stage on July 17 with the filing of federal criminal charges and the news that ComEd had agreed to a “deferred prosecution agreement,” essentially admitting to the accusations and agreeing to pay a $200 million fine.
The agreement’s statement of facts paints a damning portrait of the backroom deals that preserve the power of the ruling class at the expense of working-class Chicagoans. Among these deals was $1.3 million in bribes to “Public Official A,” widely believed to be Illinois House Speaker Michael Madigan, which ranged from appointing friends and students in his ward to jobs as meter readers and interns, and even a position on ComEd’s Board of Directors in 2019. (Calls have since grown for Madigan to resign, including from socialist alders.)
The timeline of the agreement with the Feds dates back to 2011, when ComEd was in a much worse position politically and financially, and shows how a powerful economic interest can turn around its fortunes by manipulating the political process.
The agreement’s timeline dates back to 2011, when they first began benefitting from a years-long, coordinated effort to turn Madigan into an ally.
In 2011, the Illinois General Assembly passed the Energy Infrastructure Modernization Act, over the veto of then-Governor Pat Quinn, approving a formula rate mechanism that has allowed ComEd to adjust rates as needed to guarantee financial returns without prior approval from the state’s regulatory body, the Illinois Commerce Commission (ICC). Then, in 2016, ComEd successfully lobbied for the Future Energy Jobs Act (FEJA) to include massive subsidies bailing out two Exelon-owned power plants, funded with billions from ComEd’s ratepayers—that is to say: us. Taken together, these legislative victories allowed ComEd to increase its net operating income by more than 50% and directly contributed to at least $150 million in additional profits.
While ComEd’s shareholders and Madigan’s cronies benefitted from this windfall, working class Chicagoans were left out in the cold—or in the heat. About 90 percent of low-income households in Chicago are energy insecure, meaning they must choose between paying their energy bills and for necessities like prescriptions or groceries. Last year, ComEd shut off power to 218,000 customers for lack of payment, putting them at greater risk for health conditions like asthma and heart disease.
The scandal has increased pressure for the city to cut ties with ComEd, which was the backdrop for the city’s Committee on Environmental Protection and Energy hearing on July 30. ComEd’s executives spent more than five hours answering questions from alderpeople—some of whom may not be obvious allies but who appear increasingly sympathetic to our call to #DemocratizeComEd.
Committee chair Ald. George Cardenas (12) began the hearing by calling out the inherent contradictions of ComEd’s business model with its obligations to the public. Ald. Scott Waguespack (32) illustrated one poignant example of this: ComEd is spending more money on the deferral agreement fine than it does on low-income utility assistance. (Of course, that $200 million fine is also equal to the profits ComEd pulls from Chicago each year.)
The contradictions don’t just imperil our city’s short-term needs but also our long-term environmental outlook. After Ald. Samantha Nugent (39) pressed for an update on ComEd’s plan to reach 25% renewable energy sources by 2025, as mandated by FEJA, CEO Joseph Dominguez admitted that they won’t meet the target. Though the climate crisis demands swift decarbonization, Dominguez acknowledged that ComEd is currently using just 3% renewable energy sources and will only reach 10% renewables by the 2025 deadline. To put this in perspective, Los Angeles’s municipal energy utility achieved 25% renewables in 2017 and New York City 28%.
Ald. Raymond Lopez (15) questioned whether ComEd’s involvement in the corruption scheme puts it in violation of the city’s municipal code, which prohibits doing business with entities guilty of criminal acts. Mayor Lori Lightfoot has also sent a letter to Dominguez insisting on ethics reform before the city renews its franchise agreement. Yet similar utility corruption scandals in Ohio, South Carolina, New Orleans, and elsewhere should make clear that ComEd’s corruption is not an isolated incident caused by nefarious actors—it’s a systemic issue caused by investor-owned energy companies and the web of donations to politicians, lobbying, and nonprofits they use to increase their influence and clean up their public image.
The Democratize ComEd coalition has been encouraged by this scrutiny of ComEd and the visibility for our campaign. We believe this moment is an opportunity to push even harder to expand the limits of what’s considered possible.
The next major milestone in this struggle is the impending release of a feasibility study (originally due in Spring 2020, then pushed back to “late June, early July”) outlining the financial costs and benefits of municipalization, which the city is supposed to release to the public.
While socialist Ald. Andre Vasquez (40) rightly pointed out at the hearing that municipalization would be “a reverse parking meter deal”—an upfront investment that will benefit the public in the long term, as opposed to a city asset that will generate profits for private investors for the next 60 years—Assets and Information Services Commissioner David Reynolds hinted that City Hall will consider municipalization to be cost prohibitive, and that it has already begun negotiating a new franchise agreement with ComEd. In fact, we still haven’t seen the feasibility study and have no way of knowing if municipalization will truly be cost prohibitive.
While this scandal has spotlighted the contradictions of profit-oriented utilities like ComEd and how they disadvantage the very people who depend on them, Reynolds’ comments hint at the fight ahead of us. Despite his message, however, we are taking inspiration from the unanimous vote of the Evanston City Council to cut ties with ComEd. Our neighbors to the north have set an example for how we can begin to Democratize ComEd, make heat and light human rights, and commit to the necessary investments to build the Green New Deal locally and enjoy a habitable planet for generations to come.
Though Chicago is in a “gradual reopening” phase, COVID-19 is still very much with us. The impacts of the pandemic, including the looming eviction crisis, will shape the city for decades to come. As we look ahead beyond the current crisis, it’s time to ask: What does recovery look like? And just who is the “recovery” for?
On July 9, Mayor Lightfoot’s administration released its answer with the publication of the COVID-19 Recovery Task Force Advisory Report. The report pays lip service to “transformative” solutions, but its recommendations are largely for the same incremental reforms and corporate giveaways that have failed Chicagoans for years. This shouldn’t come as much of a surprise. Business executives, investors, and public relations experts filled the ranks of the Task Force, which is co-chaired by Samuel K. Skinner, a major Republican donor and President George W. Bush’s former chief of staff.
The report begins by addressing the disparate impact of COVID-19 on Black and Brown communities. It touts the Lightfoot administration’s existing community development initiatives, including INVEST South/West, a $250 million annual investment in ten Chicago neighborhoods over the next three years, and the STEP Summit, a coalition of influential Chicagoans brought together by the administration to come up with a program to end poverty.
It is worth bearing in mind that $250 million is just 13% of the $1.8 billion that Chicago spends on policing each year. When the initial STEP Summit was held in February, socialist and progressive organizers, excluded from the coalition, responded with calls for a People’s Poverty Platform, including a real-estate transfer tax, democratizing ComEd, and the Obama Presidential Library Community Benefits Agreement.
The report’s second set of recommendations is intended to address the mental and emotional health impacts of the pandemic, an important focal point especially in light of the steep rise in suicides among Black residents of Cook County over the course of 2020. The Task Force’s recommendations include: a mental health awareness campaign, a dedicated 211 hotline for mental health services, investment in a citywide telehealth platform, and a workforce development pipeline for mental health professionals and non-clinical mental health workers.
Notably missing from the recommendations is a plan to make good on Mayor Lightfoot’s campaign promise to reopen the six public mental health clinics closed by Rahm Emanuel. This lapse did not go unnoticed. When the Task Force held a focus group with Chicago residents to review its recommendations, participants advocated for brick-and-mortar clinics and expressed concern about emphasizing a single access point for existing resources “because they thought the resources themselves were inadequate” (see the report’s appendix, p. 79).
The rest of the recommendations in the report are focused on economic recovery, with an emphasis on creating a favorable business climate and positioning Chicago as an attractive destination for tourists and major corporations. The report calls for regional coordination targeted around three strategic industries: logistics, health care, and agriculture. Public-private partnerships (which are usually a much better deal for corporations than for the public) are a recurring theme. The Task Force urges the city to “capture opportunities created by COVID-19” by, among other things, expanding efforts to bring corporate headquarters to Chicago by offering tax incentives and “leveraging” large-scale developments like Lincoln Yards and The 78.
Despite the huge spike in unemployment and housing instability caused by COVID-19, workers themselves are barely an afterthought in the report, which includes recommendations for expanding workforce training programs, increased loans to minority-owned small businesses, and expanded short-term relief for individuals. Recall that earlier this year, 85,000 people applied for 2,000 housing assistance grants. Even post-expansion, this relief program meets a tiny fraction of ongoing need. Similarly, with South Side unemployment rates exceeding 30%, the recommendations in this report cannot match the scale of the problem. One bright spot? A recommendation for a workers’ Bill of Rights, modeled after legislation to protect domestic workers in New York and elsewhere.
Crain’s reports that Chicago faces a $700 million dollar budget gap in 2020, and that “all options are on the table” for Lightfoot, including layoffs and property tax hikes. Right now, we desperately need to tax corporations and the wealthy to fund economic recovery for the working class. These options, however, don’t seem to be on the table. Instead, the mayor’s plan is to lay out the red carpet for corporations and beg them to share some of their windfall with the rest of us. (Fittingly, the report wraps up with a toothless “Corporate Pledge”—the mayor is a big fan of pledges, apparently.)
The influence of PR executives and destination marketing specialists on the advisory report becomes apparent in the last set of recommendations to revamp Chicago’s master brand and “share our story.” These recommendations emphasize the development of tourism beyond downtown through “place-making” investment in neighborhood tourism hubs and infrastructural investments in green spaces, transit, and arts and culture venues. One of the explicitly stated goals of these efforts is to attract new “talent” to the city, presumably high-wage workers in target industries. These are the outlines of disaster capitalism in a progressive guise.
Focus group participants reviewing the report’s recommendations expressed concern about the emphasis on tourism and fear that this project could contribute to further gentrification (see appendix, p. 77). They are right to be concerned: without explicit protections, like robust Community Benefits Agreements, many of the recommendations will inevitably lead to displacement of longtime residents. They will also lead to an expansion of “quality of life” policing, criminalizing residents while making neighborhoods more comfortable for tourists and transplants. While small business owners in the neighborhoods might benefit from this model of economic development, these gains come at the expense of working class residents.
From the outset, the report outlines the devastating impact of COVID-19 on Chicago’s Black and Brown communities and acknowledges the “history of structural inequity” at the root of this disparity. Nevertheless, the Task Force’s recommendations follow a familiar logic: pull out all the stops to create a favorable business climate, shore up Chicago’s image as a “global city” geared toward tourists and highly-skilled workers, and appeal to corporate goodwill in the hopes that some of the profits will find their way back into Chicago’s neighborhoods. This is a far cry from the transformational change that working class Chicagoans are demanding and deserve.
When this report was published, there had already been over a month of sustained protests following the police murder of George Floyd, leading to demands to defund the police and fund robust social services. The image of downtown Chicago barricaded from the rest of the city—bridges raised and transit suspended—has come to symbolize this moment. Though the report makes many references to structural inequity and economic development on the South and West Sides and even acknowledges the protests, the actual demands of people at the grassroots are missing from the narrative.
We must understand that this report and the repression of protesters are part of the same overall project to signal to the ruling class that everything is under control, private property remains sacred, and Chicago is open for business. Most of the recommendations in this report are clearly for the benefit of the same capitalist interests that Lightfoot has prioritized since her first day in office. As socialists, we know that our interests are fervently opposed to the interests of capital and that corporate benevolence will not save us. To get the recovery we deserve, we must be prepared to organize and fight.
The Red Star Bulletin was conceived by Ramsin Canon and is a project of the Political Education & Policy Committee. This issue was drafted by CDSA members. Special contributions were made by Brent Glass, Pat Chestnut, Nick Hussong, Ethan Jantz, Charlotte Kissinger, Alan Maass, Kyle Sparks, and Sveta Stoytcheva. Graphics were contributed by Patrick O’Connell. If you would like to contribute to the Red Star Bulletin or have any feedback, email politicaleducation@chicagodsa.org.
