To stay alive in perpetual late capitalist austerity, cities turned to a strategy of luring in and viciously protecting big capital and a high-income gentry. This strategy required a lot of different structural reforms and tactics, to create and nurture urban playgrounds for the rich and the petty bourgeoisie–and these policing, education, land use, and labor policies are all tightly tied together. A counter-insurgency, surveillance-heavy policing strategy has evolved to enforce the boundaries of where capital reigns and a new gentry can play. On top of this, the needs city government has to meet cannot be met under the current structure of how public goods are funded. Without a comprehensive city- and statewide strategy to completely reorder how we govern our cities, socialists’ political victories will be constantly subject to capital’s social power.
Rise of the New Machine
U.S. cities are in a constant bind: they have very few powers to raise revenue, but a lot of responsibility for distributing services. This is a recipe for political turmoil, as residents are easily and quickly frustrated by gaps in expected service–whether it’s traffic, transportation, public safety or any of the hundreds of ways we experience local government–while the city is constantly strapped for ways to actually raise money. People may be willing and happy to pay taxes when their streets are well paved, the buses show up on time, and the schools are running smoothly, but a tax increase when things are decaying is a recipe for a voter revolt.
What’s worse, the federal government provides little direct, discretionary support for cities–meaning what money cities get from the feds usually comes with strings attached, and can’t just be spent on what the elected representatives of the people see as priorities. Money tends to go more to states, and cities only have those powers that they are granted by states, even so-called “home-rule” cities like Chicago, which have general powers but can have those powers taken away by state government (known as “preemption,” the most notorious recent example being the Illinois ban on local rent control).
In the early 1990s, with neoliberalization of the economy–more deregulation, more foreign competition, and less public money–cities suffered from disinvestment. Voters noticed and reacted. The two biggest cities in the country, New York and Los Angeles, elected Republican mayors in 1993–two years before the next Chicago Mayoral election–as a reaction to the supposed mismanagement that required both high taxes and suffering services and infrastructure. Chicago’s Mayor Daley was not about to let the same thing happen to him, and so he used his significant power over the Chicago delegation to state government to pass a bill in 1995 that would eliminate partisan elections for Mayor. As of 1999, mayoral elections would be “non-partisan,” meaning the top two vote getters would go to a run-off. Before this, at least since Mayor Harold Washington’s first election in 1983, you would have to survive an ideologically and racially divided Democratic primary in order to face off with whoever the GOP was putting up. With the mini-wave of GOP big city mayors and capital’s increased interest in potentially investing in building up urban Republican parties, eliminating the partisan primary ensured that two “Democrats” would always advance to the second round of voting, where big business and neoliberal voters would rush to the “moderate” option.
What this meant in practice was that if big capital was interested in increased domination of Chicago city government, Democrats–and more specifically, Mayor Daley–would still be the only game in town.
This allowed Mayor Daley to pursue a juiced-up neoliberal strategy of urban governance that was increasingly popular among technocrats and policy wonks: a new kind of political machine, fueled and oiled by real estate and finance money (so-called “pinstripe patronage”). For Daley, increasing privatization and the distribution of public-private partnerships, weakening public sector unions and racial and ethnic group movements, and holding the line on taxes instead of generating revenue through increased capital investment would be the wave of the future. There were structural changes necessary in order to get there, and much of these centered on the area where cities always have the most power: the use and disposition of land.
Land Use and the Entrepreneurial Government
In the U.S., all but the smallest of localities (cities, towns, townships and villages) have almost complete power over what is called “land use policy,” which is sometimes short-handed as zoning, although that is not all that is entailed in land use. Land use policy is local policy in most of the country, with some exceptions usually relating to transportation and transit and certain environmental matters (in some states, local decisions can be reviewed by state agencies). This complete authority makes land use an attractive power for city governments; as a result, if you visit the municipal code of any given city, the zoning (or “planning”) section of the code will usually be set apart from other policies , given its level of expansiveness and detail . Zoning rules are often the basis for policies that you would not automatically associate with zoning–for example, cities will condition zoning permission to build housing of a certain density (or number of units) on the condition the developer pay into a housing fund. In some instances the zoning code can indirectly legislate labor policy by creating different requirements for chain stores and protecting mom-and-pop stores from competition (sometimes called “formula retail ordinances.”)
With the constant threat of capital flight–employers, corporate taxpayers, and higher-income residents leaving the city for suburbs or other cities–and voter reluctance to pay more in taxes, cities were convinced the future required acting “entrepreneurially”–mimicking businesses attracting capital investment, in the form of new development. What better way to do this than through the zoning and planning code, luring new developers and high-income taxpayers into the city by permissive and incentive zoning practices. This included things like increased use of planned developments (PDs), which create unique rules for a given massive development, use of tax increment financing, and special service areas to trap revenue in a given area and use it to finance the development. In Chicago, the real estate transfer tax became a major source of government revenue, relying in turn on constant new development.
How necessary was this development engine? When the big housing bubble burst in 2006, Chicago’s real estate transfer tax (which is just what it sounds like: a tax on real estate sales) declined from $242 million to $63 million in 2009–a loss of $180 million in just a few years. By 2008, this represented about 40% of the city’s ballooning budget deficit. In 2009, Mayor Daley sold the city’s parking meters to an investment consortium for 75 years in exchange for a billion dollars.
With no political will or national system in place to tax wealth and fund infrastructure and services, the neoliberal city needs constant capital investment for new development and to raise the tax base and fund services. This makes cities extremely sensitive to capital’s periodic crises–and when there’s a burst bubble or capital flight, the city has to turn to capital to auction off its–our–resources to make up for the shortfalls. Capital forces cities to warp their public policy in creating an attractive climate for investment–schools for the gentry, policy for the gentry, transit for the gentry–an entire parallel system for the gentry.
The result is a city-within-a-city, where living in certain neighborhoods means never having to leave or interact with people outside your social strata: sending your kids to their own schools, shopping at stores that cater to you, using rideshare services, and moving about in complete confidence that nobody beneath you will ever interact with you, except to serve you.
Beyond land use, Chicago used its other major power– its own business affairs and employment practices–to act entrepreneurially. This was when Mayor Daley undertook major public-private partnerships and privatization efforts, essentially bringing in major investment groups by selling off services the city was already providing or wanted to provide, then eliminating the often unionized jobs associated with them. The 1990s saw a rush of these partnerships, ostensibly reducing taxpayer costs (and so avoiding tax increases) while increasing the base of corporate taxpayers. Growing the corporate tax base would create an influx of high-income employees who supercharged the process of gentrifying neighborhoods.
Daley’s strategy was to make Chicago enticing for capital investment and a new gentry by starving social welfare, pushing out the working class and in particular the Black working class, and selling an image of a “lean” city government eager to “partner” with big capital, rather than wring it of tax dollars to spend on the public good. Consider this excerpt from a 1993 article contrasting Daley with then-New York City Mayor (and DSA member) David Dinkins:
When David Dinkins calls for more urban “investment,” he is talking about expanding the welfare state. When Rich Daley does so, he can more credibly claim that the investment will fund basic services and economic development projects which, over the long run, should help the city retain both jobs and taxpayers, lessening the need for more subsidies later. In addition, the more Daley succeeds at reforming his own agencies, the less affluent suburbanites can oppose urban aid on the grounds that their tax dollars will be thrown down a “rat hole.”
Convincing big business and “suburbanites” that the City’s spending isn’t going into “rat holes” is a nice vernacular way of saying that Daley’s philosophy was that investors and the gentry needed to feel comfortable that their tax dollars would go back to into their own playgrounds and the city’s working class wouldn’t see a nickel. That they can build safe suburbs-in-the-city and not pay into “waste”–union wages, social services, the public good.
Enter the Gentry
These interlocking policies feed off one another. To increase the tax base, cities wanted to lure in higher-income people, and in particular to increase the ranks of what we call the petty (or petit) bourgeoisie–the class of semi-autonomous small business owners and professionals who technocratic policy types will refer to as entrepreneurs, the “creative class,” or any number of different euphemisms. These individuals can range from the iconic start-up types, to professionals and consultants who are self-employed or move between high level positions at firms, to academics, to nonprofit executives; while they do not live solely on passive income like the big capitalists, they are made uneasy by worker organization and worker power, both in the workplace and socially.
As mentioned above, this entire strategy required major structural reforms. The shift to a non-partisan Mayoral primary was one political solution. But if the city were to become a playground for upper-income transplants financed by big capital investment, there needed to be a comprehensive shift . For one thing, governance over the schools could not be left to democratic chance and union influence. In 1995, Mayor Daley firmly took over the school system with the Amendatory Act, which abolished the nominating commission system created in the 1980s after Reagan’s Education Secretary William Bennett proclaimed Chicago’s schools as the worst in the nation. Under the commission system, regional groups of local school councils (LSCs) chose three nominees for each school board seat, from which the board members were chosen. Under the new system, Mayor Daley appointed the entire board and its executives. Schools are a critical part of land use–property values (and therefore property taxes) are directly related to the reputation of the public schools. To attract a new high-income–and mostly white–population to the city, Mayor Daley needed more direct authority over the schools, in particular the ability to privatize parts of the district by creating charter schools that could either formally or informally be selective in their enrollment, leaving the public schools to working class and Black and brown residents, and reserving the privatized schools for higher-income families. Putting charter school “networks” into competition with one another required they be free from a standardizing union contract and a school board free from public and union pressure.
Privatization and public-private partnerships were key to not only gutting the public sector (and therefore union jobs and union power) but also to creating a layer of petty bourgeois NGO and small business owners who contracted with the city to provide services of various types. Under Mayor Daley, this strategy served two ends: to weaken organized labor (who won the right to unionize in the city under Harold Washington, who had been supported by AFSCME) and also to develop local bourgeoisies in underserved neighborhoods. That layer of leadership was then brought into a governing coalition. For example, the United Neighborhood Organization (UNO), at one time a radical Latinx Alinskyite group, morphed into a chain of charter schools and professional networking entities, creating the Metropolitan Leadership Institute and Corporate Leadership Institute. Their one-time firebrand leader, Danny Solis, eventually became Daley’s deputy mayor and the chair of the Zoning Committee until a federal investigation exposed alleged corruption in 2018. Reverend Leon Finney, co-founder of The Woodlawn Organization, another Alinskyite community organization that began with a mission of battling displacement by the University of Chicago, was appointed to the city’s Planning Commission and founded a non-profit which held a $2 million annual contract to manage public housing. In 2010 he was ousted from his position by Mayor Daley not long after residents of his housing protested slum-like conditions, chanting “Slumlords out of City Hall!”
Mayor Daley enticed big capital–major investors and corporate employers–by transferring power away from mass democracy and working class organizations to a new petit bourgeois layer, even luring stalwart radicals away from community defense with the promise of access to resources and the infamous “seat at the table,” creating a feedback loop that brought in more gentry, displaced working class families and in particular Black families, which in turn brought in more capital investment for more playgrounds for gentry. This would not come without turmoil: so there was still the question of policing.
Policing the Domestic Empire
How will people react when you privatize services or end services they rely on, take huge parts of their neighborhood for exclusive developments, smash their labor organizations, and take away their schools? Some will leave; some will have to resort to petty crime to survive; many will dig in and resist, often with intensely disruptive tactics.
Other than schools and budget austerity, a neighborhood’s reputation for “safety” was critical to selling it to gentrifying developers and the petty bourgeois residents neoliberals desperately wanted. In a system where segregation is formally illegal, the best wall to build is a blue one: a police force tasked with patrolling the growing gentry playground neighborhoods and making sure they were undisturbed by Black and brown people.
Chicago’s policing strategy in this period shifted towards what is basically a counter-insurgency model, the model of U.S. imperialism abroad projected back at home. It became a strategy meant to protect the immense investment of new capital increasingly necessary to funding the city.
Between the 1960s and 1990s, the dominant philosophy of urban policing was “community policing.” The supposed idea–mostly idealistic, or aspirational–was that police should relate to a “community” and therefore be able to intervene proactively to prevent or address crime, rather than be seen as local enforcers. In the early 2000s, community policing gave way to “intelligence-led policing” or what some scholars refer to as a “homeland security” strategy. More top-down control and data-driven work and more technological surveillance when added up looked like an imperial counter-insurgency strategy. Obviously, such a strategy required increased surveillance practices tightly managed by the City’s police leadership.
From the late nineteenth century until the 1980s, the Chicago Police Department (CPD) maintained special units responsible for surveillance, particularly of subversive groups–labor unions, socialists, Black Power and other national liberation groups, and others. Most recently this was known as the Subversive Activities Unit, or Red Squad. The Red Squad was involved in infiltrating and monitoring potentially radical groups until a lawsuit in 1974 resulted in a 1982 consent decree ending the practice.
In 2001, lawyers for the city sought and won a modification of this consent decree; it was finally dissolved in 2009. In 2003, the city debuted the “cop in a box” surveillance cameras, formally called “police observation devices” or PODs, of which there are now more than ten thousand across the city, including the CTA, all monitored centrally. Meanwhile, the CPD has seemingly resurrected its Red Squad: beginning in 2009, CPD surveilled at least six different groups; the CPD surveilled an organization I co-founded to fight the Olympics coming to Chicago to determine whether any civil disobedience was planned for a visit by the International Olympic Committee (IOC). Some of us remember being followed home after meetings.
The connection between this new mode of urban government, counter-insurgency and surveillance was showcased best when the CPD attempted to infiltrate a group of South Side activists who were resisting Mayor Emanuel’s closing of public mental health clinics, up to and including occupation of one of the clinics slated for closure. Here was an effort to cut and privatize services–the privatization that neoliberal government requires–that would have an immediate impact on Chicago’s Black and brown working class neighborhoods; the natural reaction to fight such effort drew the attention of the city’s militarized policing establishment. The ruling class anticipates resistance to these measures will be stiff and even drastic; thus, the police need to be prepared to deal with the social rot of increasing austerity by disrupting the organizing that might effectively combat these policies, and by patrolling the fluid borders between the gentry playgrounds and the working class neighborhoods that surround them.
The mode of government that funds itself with a constant infusion of financial capital and a steady stream of upper-income and petty bourgeoisie residents requires not just punitive policing but counter-insurgency policing, because it rests on austerity, hyper-exploitation, and block-to-block racial and economic segregation.
The Dream and the Nightmare of the Socialist City
Chicago is one of the wealthiest cities on Earth by GDP–by some estimates wealthier than Shanghai, London, Berlin or Beijing. The fact that Chicago is rich is not to say that Chicago has to be rich. As despicable as the Daley era of neoliberal governance was, it can’t be contested that these policies lured a lot of wealth into the city. Similarly, we should not expect such wealth to stay if and when a reinvigorated socialist movement increases its control over the machinery of the city: the example of how U.S. imperialism has dealt with socialist projects in other potentially wealthy nations should be enough to school us. Not only should we expect capital flight, but we should expect state government and/or the courts in particular to restrict the powers of city government. It’s a living nightmare too easy to envision: just as we build a large enough movement to take meaningful power to govern the city, the capital strikes and the home rule powers disappear, tarnishing for years the socialist program and relegating us back to the margins of U.S. politics.
If we break apart the gentry playgrounds and reinvigorate a workers’ movement that upsets the domination of the big and petty bourgeoisie, there will be a reaction, whether it is wealth flight or political undermining of the movement, or more likely both. The coalition Daley built is still with us, and in many ways predominates. On one side, the titans of capital smothered an effort to enact the “Fair Tax,” a progressive income tax, with the flick of their wrists; on another, in the Daley-Emanuel era mold, local bourgeoisies will turn people out to fabricate grassroots support for things like school closures and the Olympics; and on yet another, self-identifying progressives who phonebank for Joe Biden and voted for Mayor Lightfoot become quickly impatient with disruptions to their Friday night plans.
In our imagination, it may be the mass of noble workers rising up against capitalists in tweed and petty bourgeoisie in North Face fleece. The reality will be different. There will be neighborhood powerbrokers, confused but seemingly well-meaning liberals, trades unions that survive on new construction, an NGO complex tied to privatized services and incumbent politicians, all in a sporadic but effective coalition that will not only resist change, but most likely will do so using the language and imagery we assume is ours and ours alone: talking about freedom, liberation, equity, and justice. They will be talking about investing, about developing, about bringing jobs, funding programs, about uplifting–and they’ll be dangling power, money, and prestige for those willing to defect.
The status quo has an almost unlimited ability to kneecap or absorb opposition; its track record for doing so is sterling silver. The movement should not just expect The People to take our side upon seeing our burning righteousness. We must have a specific and strategic theory of change and do the political work necessary to build peoples politics–to never assume anybody’s politics. Without a theory of change that lays out a vision for how we get from here to there, of how we will withstand the storm that will come, we’ll lose shape, and having lost shape, we’ll crumble.
