Progressive Cities in a Death Spiral

Progressive Cities in a Death Spiral

– By Howard Sierer –

Cities governed by progressive elected officials are spiraling down the drain, socially and economically.

Chicago, New York, San Francisco and others defunded their police, turned their jails into revolving doors for repeat offenders and catered to teachers’ unions and public employees while driving businesses away with ever-higher taxes and fees. The predictable result: middle-class residents of all races are voting with their feet.

Between 2020 and 2022, a net total of 175,000 people left Chicago’s Cook County. During the same time period, 71,000 people left San Francisco – 10% of its population – and 503,000 moved out of New York City – approximately the population of Tucson, AZ.

Chicago was last month’s poster child for destructive progressive governance. The city is nearing bankruptcy and its pension funds are impossibly short of funding despite some of the highest property taxes in the country. Boeing, Caterpillar, Tyson Foods and the $62 billion financial services company Citadel LLC have all left Chicago in the last year, taking upmarket jobs with them.

After losing a number of their most productive citizens, how did the folks remaining in Chicago decide to address their civic crisis? They elected as their mayor progressive Brandon Johnson, a Chicago teachers’ union organizer. The union is ecstatic, now with the opportunity to impose more of its progressive madness on Chicago’s citizenry after having inflicted district students with the country’s most extensive and damaging pandemic school closures in 2020-21.

Public unions, and especially teachers unions, effectively control the Democratic Party and have allied themselves with the woke left. The result: less-informed citizens who see the ruin around them and vote for more of the same.

Mayor-elect Johnson campaigned on a $1 billion tax-the-rich plan to fund a variety of new social programs. He plans a monthly $4 per employee tax on large companies that have at least half of their operations in Chicago, a $1 or $2 tax on every securities-trading contract, higher taxes on hotels, a “mansion tax” on transfers of real estate valued at more than $1 million, and “user fees on high-end commercial districts frequented by the wealthy, suburbanites, tourists and business travelers.”

How is all this likely to work out? Given support from Chicago’s progressive city council, there’s little doubt that the new social programs will be started. But Chicago need only look to San Francisco to see how dramatic increases in business taxes always fall short of revenue expectations as business leaders and employees pack up and move elsewhere, almost always to lower tax locales.

In 2018, San Francisco voters approved a gross receipts and payroll tax on businesses to fund homeless housing and programs. The measure raised 45% less revenue than was projected because businesses either left the city or let their employees work remotely. The city controller’s office forecasts a $780 million city budget deficit over the next two years because of population flight.

San Francisco is also suffering from “retail flight” as Nordstrom will  close its two stores in the city’s crime-ridden Westfield mall downtown. Gap, whose hometown is San Francisco, closed its flagship store there along with a second store in 2020. Walgreen’s, Whole Foods and H&M have all moved out.

For those who haven’t been to San Francisco lately, sidewalks are still filthy, still clogged with homeless tents, and still unsafe: witness the downtown street murder of Cash App founder Bob Lee and the ironic theft of a CNN team’s luggage while they were covering the city’s rampant street crime.

The nationwide shift to remote work during the pandemic has made workers and businesses more mobile, shrinking both the tax base and the number of voters who would have voted for common sense solutions to big city problems.

America’s big cities are increasingly steered by the interests of government unions and those who depend on the government dole. We are seeing the literal fulfillment of Alexis de Tocqueville’s famous observation about America’s democracy: “The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money.”