Urban Planning Tue Dec 20 2011

Regime Theory in Chicago: A Case Study

By Ramsin Canon

This week, Chicago Parking Meters, LLC, the shell consortium that owns our once-public parking meters, has sent the city two bills: one to compensate it for parking by the disabled, and one to compensate it for street closures. Despite some lap yapping from the Mayor, the city has little choice but to pay these bills, either in full or mostly-in-full.

The parking meters are bemoaned as an anomalous poor choice by Mayor My Predecessor, and Mayor Emanuel has regularly shifted between jokey anger and sighing resignation as to it. The truth is though that Mayor Emanuel will have his own Parking Meters deal--probably several--before his Mayoralty ends, and that his power to govern the city--to actually govern city, not just move numbers around between departments to create superficial savings and issue press releases--is not a function of his ability to "lead" but a function of his ability to creatively supplicate.

How does Chicago's government operate? The way it actually operates is fundamentally different from the way it apparently operates. The "apparent" part: it writes laws and enforces them evenly. The way it actually operates: it makes up for a deficiency to act on its own by seeking out powerful investment institutions to partner with, offering up its coercive authority in exchange for badly needed capital. Those agreements are the regime we actually live under, not the laws on the books.

The fundamental shift towards neoliberalization of the economy and government at federal and state levels has changed how Mayors and Councils "govern" cities if they really govern them, in the classical civics-class sense, at all. Of course Emanuel, as one of the political architects of one of neoliberalization's most important structural supports, NAFTA, is not a victim of neoliberalization but an important figure in its rise. That fact is one of the reasons national elites rushed to fund his campaigns for Congress and the Fifth Floor.

In the Neoliberal City, laws, regulations, and rules are less important than relationships between political leaders and wealth, or capital. Mayor Emanuel explicitly ran for office touting his ability to "leverage" his relationships with wealthy elites. He even comically justified his immense fundraising from out-of-state and global financial elites by pointing out that because the rich like him, he'll be able to beg goodies out of them for the public.

The regime that runs the city is not about legislation and enforcement, it is about bilateral agreements, where government promises to use its power for the benefit of investment, or capital, to the greatest extent possible. Carving exceptions to law is as important, if not more important, than legislating itself.

The most stark example of this is the "Memorandum of Understanding" between the City and the University of Chicago, an agreement that could usher in major changes to the Hyde Park/Kenwood area, that was agreed upon in bilateral negotiations between the Mayor and the President of the University. The Mayor told the press he was moved to go into these high-level negotiations with the University after the President told him that in China, such building projects only took six months, whereas the bureaucracy here would lengthen it to years.

The agreement is quite impressive. It binds the city, in something less than a contract but more than a handshake (but more or less a contract, as permitted by law) to speed various regulatory and agency approvals through the process, time its various repairs and upkeep processes, and similar like items, to make the University's development plans as easy as possible to move.

Keep in mind that this is not a criticism. The agreement certainly has its critics on the South Side, including, at least initially, the local aldermen who complained that the final agreement was announced even while they were still making suggestions. But given the city's limited resources for development, committing the University to make improvements and hire local people in an efficient and timely way is, at least in the abstract, a good thing.

There's nothing inherently "wrong" with it. Appropriate or not, it is what the Mayor has to do. He doesn't really have much choice, at least without pursuing fundamental reforms that, in isolation from broad changes in the national economy, might not have much effect. As can be deduced from the flood of press releases the Mayor's office puts out about various deals to bring capital (euphemized as jobs, though enforceable agreements regarding jobs are rare) back into the city, the regime that governs the city is one wherein sources of capital contract with the government to use or refrain from using its coercive powers. As with any negotiations, those parties with more power extract better agreements. In an era where "job creators" and investors are favored by the media and desperately needed by the political class to fund their campaigns, the bigger the institutions, the more power they have in such negotiations. A bifurcated system results.

The University of Chicago employs some 10,000 people and is the largest property owner in Hyde Park and one of the largest property owners in the city. For a cash-strapped city, there is no real option but to enter into contracts that determine a community's future. It is a very powerful economic institution. It is comparatively benevolent, and unlike many powerful economic institutions, it cannot periodically threaten to leave to enhance its negotiating power even more. It can however decline to invest, which is just as bad.

So Hyde Park will be governed not only by the laws the City Council writes and the Mayor enforces, but also by side agreements between the Mayor and the neighborhood's most powerful economic interest. And this is micro case study of a macro situation. The city's most powerful economic institutions, through direct threats or indirect threats issued by civic committees and think tanks they fund, starve the elected government of the ability to act, and then go about creating bilateral contracts between the city and private actors that provide them unique subsidies and exemptions from law. Thus the myriad development agreements associated with TIF funds.

The result is obvious. You and I, not being economically powerful interests, are subject to one set of laws, the ones on the books. But if you have the money to pour into campaign coffers, or the resources to "create jobs" in the abstract, you can determine what rules you live by separately. This is the true "public-private partnership"; the one where the powerful buy their ability to be governed by contract rather than consent.