Heighten the Contradictions

I haven't, up until now, written much (or anything) about the Chicago mayoral race. It has been fascinating to me that someone I see as very much to the left, Rahm Emanuel, is under attack for being too conservative. If a similarly rightist politician were being challenged by an extreme rightist, we would be seeing numerous articles and editorials tut-tutting about how the Republican Party is doomed because it's controlled by its most extreme factions.

But in this instance, the media is mostly silent, though this editorial in today's Washington Post lightly chastises the Democratic Party for its extremism.

A runoff election next month to determine if Chicago Mayor Rahm Emanuel gets a second term appears to be close. His opponent, Jesus “Chuy” Garcia, is not as well known and has far less campaign money, but recent polls show him within single digits of Mr. Emanuel. Democratic Party purists and special interest groups have reached the startling conclusion that the able and decidedly liberal incumbent is not liberal enough, and they are intent on punishing him for not toeing their line. If there is no room in the party for a pragmatic progressive like Mr. Emanuel, who was President Obama’s first chief of staff in the White House, then the party, and by extension the country, are in trouble.

To bring those not in metro Chicago up to date, Emanuel is seeking re-election and, having failed to reach 50% in the first round, is facing a county commissioner, Jesus ‘Chuy’ Garcia, in a run-off.

Tom Bevan argued a few days ago in Real Clear Politics that Emanuel, having received a well-deserved black eye by being forced into the run-off, now should get the support of sensible folks. His viewpoint, though from the right, is pretty much in line with the establishment-liberal WaPo.

But now that the schadenfreude has worn off, Chicagoans face a choice. 

As is the case in many big cities across the country, Chicago has been ruled exclusively by Democrats for a long time — since 1931, to be precise. The city’s last mayor, Richard M. Daley, ruled for 22 years before retiring in 2011, using a number of budget gimmicks on his way out the door to paper over the city’s profound fiscal problems — most notably a ticking time bomb pension payout set to detonate next year. 

It’s hard to see how Garcia, a Democrat who’s more liberal than Emanuel and far more simpatico with the unions and other entrenched special interests, will be able to muster the political courage to make the tough choices that need to be made. 

What Chicago really needs is a pragmatic, center-right technocrat — a Windy City version of Michael Bloomberg, for example — who could implement meaningful and lasting reforms to get the city’s fiscal house in order. But such a person isn’t on the ballot and, even more depressing, probably could not be elected if he (or she) were. 

So Chicago faces a “lesser of two evils” election. It’s an unfortunate situation, but one that brings to mind the old saying “better the devil you know.” Rahm Emanuel is the devil we know — even if he has egg on his face.

It’s a perfectly reasonable viewpoint, which I, being unreasonable, as I often am, choose to reject. I will reach back almost five decades to my days hanging around with campus Marxists for the ‘why’, as well as for the title of this post.

‘Heightening the contradictions’ is an old Marxist idea that making the tottering capitalist system even more oppressive would make the workers more conscious of their burden and thus push them toward rebellion (or something like that – not being a Marxist, I was and am a bit hazy on the details). In the late sixties, though, my Marxist friends would often use the phrase in the course of arguing, for example, that Nixon was preferable to Humphrey, since Nixon was clearly a tool of the oppressors, while Humphrey posed as a friend of the workers.

It’s pretty much the opposite of the ‘lesser of two evils’ argument Bevan offers.

I’m taking my contrarian position because of the accumulating fiscal dilemma Chicago faces. Bevan and WaPo both allude to it, and this item from about a week ago spells it out a bit more.

CHICAGO (Reuters) – Chicago drew closer to a fiscal free fall on Friday with a rating downgrade from Moody’s Investors Service that could trigger the immediate termination of four interest-rate swap agreements, costing the city about $58 million and raising the prospect of more broken swaps contracts. 

The downgrade to Baa2, just two steps above junk, and a warning the rating could fall further still, means the third-biggest U.S. city could face even higher costs in the future if banks choose to terminate other interest-rate hedges against fluctuations in interest rates. All told, Chicago holds swaps contracts covering $2.67 billion in debt, according to a disclosure late last year. 

“This is an unfortunate wake-up call for anyone still asleep over the fiscal cliff facing the city of Chicago,” said Laurence Msall, president of the Chicago-based government finance watchdog, The Civic Federation. 

Chicago’s finances are already sagging under an unfunded pension liability Moody’s has pegged at $32 billion and that is equal to eight times the city’s operating revenue. The city has a $300 million structural deficit in its $3.53 billion operating budget and is required by an Illinois law to boost the 2016 contribution to its police and fire pension funds by $550 million. 

Cost-saving reforms for the city’s other two pension funds, which face insolvency in a matter of years, are being challenged in court by labor unions and retirees.

If one accepts, as I do, the idea that Chicago will sooner or later follow Detroit into bankruptcy, then why not sooner? Let’s move things along so that it becomes increasingly difficult for anyone but the willfully blind to deny that the blue model is failing. If Garcia, as is likely, would refuse as mayor to do anything to rein in pensions and benefits while maintaining or expanding social spending – so much the better.

Bring on the revolution!