Like so many of our major cities, Chicago is an utter financial mess. Decades of Democrat rule, ending with the least competent mayor in the history of the republic, Mayor Brandon Johnson, have wrought this mess. Businesses are leaving. Citizens who can leave are leaving. Chicago is being left, like so many of our major, Democrat-ruled cities, for a few ivory-tower elites shielded by their wealth, and the dependency class, who stay for the ever-increasing promises of more of other people's property.
The rest of the nation should look on this mess with horror - and with trepidation, because these things, these leftist-caused financial meltdowns, always seem to end with those self-destructing jurisdictions asking to a handout of taxpayers' dollars from the rest of the state, or the rest of the nation.
City Journal's Thomas Savidge has some thoughts on this mess; they are worth considering.
Chicago has seen better days. The city is losing residents and businesses and is digging itself deeper into debt just to maintain the status quo. Yet city officials show no intention of cutting back on spending.
This crisis, however, will have nationwide implications. An unconditional bailout will signal to other fiscally mismanaged cities that their irresponsibility can be rewarded.
Key concept here: If we were to offer Chicago a bailout, other cities would expect the same - like, say, Mayor Mamdani's New York, which the communist mayor is busily pushing towards a financial collapse.
Chicago's problems? Democrats. It's been a Democrat-dominated jurisdiction for decades.
At its core, Chicago’s fiscal problems are straightforward. For decades, the city has committed itself to unsustainable spending levels. While its ridership is declining, the Chicago Transit Authority (CTA) is flush with funds thanks to sales tax and driver fees. Chicago Public Schools (CPS) expenditures keep growing despite declining student enrollment. In addition to structural budget deficits, Chicago has some of the nation’s largest unfunded pension liabilities.
Meantime, residents are fleeing both Chicago and the State of Illinois. In the year ending last July 1, Illinois lost over 40,000 residents, many from Chicago and the surrounding suburbs. The Chicagoland area lost more than 35,000 residents either to other counties in Illinois or to other states. Despite an influx of 44,000 international migrants, blunting the effect of net domestic outmigration, government officials can’t conceal the city's fiscal irresponsibility.
What's not answered here is how many of the 44,000 international migrants are in the United States illegally, and how many of them are actually contributing to Chicago's economy rather than being a drag on it. Still, I think we can take a pretty good guess at the answer.
Here's the thing: Under no conditions should Chicago be offered a federal (or state, for that matter) bailout. As my late father was fond of telling me whenever I'd gotten myself into some youthful indiscretion, Chicago should be told, "You got yourself into this mess. You get yourself out of it." A bailout wouldn't change anything in Chicago's incompetent, failing governance. Indeed, it would allow the Windy City to continue, to continue electing incompetent mayors, corrupt aldermen, and so forth. When any bailout funds were exhausted, the city would have its hands out for more. That's how these things work.
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The real problem here is a simple one: Democrats. Democratic policies have driven Chicago to this pass. Any local Republicans may not be able to retrieve Chicago from the edge of their fiscal abyss, but one would think that they should at least be given the chance to try. The current crop of leftists sure aren't getting the job done.
Or are they? As noted above, Chicago is increasingly being left to two constituencies: The ivory-tower elites who are insulated from decades of bad policy by their wealth, and the dependency class who are voting for Santa Claus. Are there enough productive citizens in Chicago to turn the tide? Ay, that's the rub.
Mr. Savidge continues to make a very interesting point:
The door is open, then, for Illinois and Chicago to return to D.C. and ask for federal assistance. If granted, taxpayers nationwide will pay for the Windy City’s fiscal recklessness. And the bailouts likely won’t stop there. Officials in other cities, such as Mayor Zohran Mamdani in New York, will be watching closely. If Chicago can get a bailout, why not the Big Apple?
Rather than properly manage their budgets, city and state officials may scramble to secure the next spot in line at the federal trough. Fiscal responsibility will erode as state and local officials pay more heed to federal policymakers and the terms of federal funding than their obligations to their constituents.
The only constructive way forward is for federal officials to make an explicit warning against bailouts. When fiscally mismanaged states and cities see that Washington won’t enable their behavior, they may finally make the necessary and painful adjustments to restore fiscal solvency.
That is, indeed, the very heart of the matter. If we bail out Chicago, we must therefore bail out New York, and Los Angeles, and any other Democrat-dominated city that has been driven to the fiscal brink. No. Not any of them. Not one of them. Not a dime from the taxpayers. These cities got themselves into this mess. Let them get themselves out of it. If they can't, then let them be declare bankruptcy through Chapter 9 of the U.S. Bankruptcy Code, which allows cities to restructure their finances and debts. If that doesn't work?
Fine. Let them collapse. Sometimes the only way out is through. This is one of these times.
There's no good way out for the mess that is Chicago, or several of our other major cities. Things may well have already gone too far. But there is no argument for making the American taxpayers pay the tab for the malfeasance of city officials. Why should towns and cities, rural communities, and fiscally solvent states pony up to reward Chicago for decades of idiotic government?
The answer is no. No bailouts. Not a dime.
