Comfort is no longer enough

Great clip explaining why we work more and not less like it was once predicted:

Is Mayor Daley's Billion Dollar Slush Fund Broke?

Originally posted at Examiner.

As the City of Chicago's $500 million budget gap has come to the forefront, eyes have begun to peer behind the curtain of the somewhat bewildering subject of the City's TIF Districts. There is a lot of money out there somewhere. The reasoning is that it should be reallocated to help cover the budget gap. The Chicago Reader calls the TIF program Mayor Daley's Shadow Budget.

We recently came into possession of hard evidence of what we've long argued: that the city produces two annual budgets, one released to the public, covered by the media, and debated by the City Council, and the other forged behind closed doors by the Daley administration, shared only in pieces with certain aldermen, and never fully disclosed to citizens. Both budgets are funded by taxpayers.

For the last few years, we've been trying to force the city to open up that shadow budget, which is funded by property taxes diverted into Chicago's tax increment financing program. As regular readers know, the TIF program is a complicated system in which property tax dollars in designated districts are collected in special accounts that are supposed to be used to eradicate blight and bolster development where it might not otherwise come.

Daley administration officials insist that the program has been a huge success and that everything the public needs to know about it is available on the city's Web site. But many aldermen have started to disagree publicly with the administration—a rarity these last 20 years—and in April the City Council unanimously passed an ordinance requiring that additional documents and data showing the use of TIF money be posted online.

The City of Chicago has indeed posted a tremendous amount of information about its TIF Districts on its website. The problem, as with most government websites, is that the data posted is not open source, meaning that it's not readily usable by the public. All 162 TIF districts are on the City's site, all with audited financial statements and summary level reports provided by the Department of Community Development. Each TIF district's funding agreements that are in place are also posted. These are the agreements whereby money is allocated to redevelopment projects. The issue with the City's website is that it is confusing, some links are broken, and everything is posted in PDF format. The City has also commissioned a myriad of different accounting firms to perform the audited financial statements on each individual district. As such, there is no congruent, master financial data provided. This takes a lot of browsing through a confusing website structure, and a lot of downloading and compiling of data. The Windy Citizen did it in 2008 (for Fiscal Year 2007) and created a great informational tool in its TIF district map. Now, I've compiled the data for FY2008 in Excel. The story that data tells is intriguing to say the least.

Focusing on the Department of Community Development's summary level reports, one finds that in 2008, the TIF collected $545,753,147 in revenue, and spent $468,631,911. The fund as a whole therefore recorded a gain for the year of $77,121,236. The summary level reports also portray each TIF district's net balance. This is the total money in the bank, as it were, that each district has on hand. At The fund as a whole showed a total net balance of $1,249,217,223. In its summary level reports, the Department of Community Development also addresses the TIF's "Planned Minimum Expenditures." Each district's summary report tells how much money is intended to be spent. The assumption behind this is that agreements are either already in place, or are close to being in place. The Reader's Shadow Budget article bears this out:

Many of the items in the TIF budget seem to be pretty far along. Most are categorized as "appropriated," meaning the expenditure has already been approved or finalized, or "committed," meaning it's "locked in" or expected to be shortly, according to community development department spokeswoman Molly Sullivan, who provided written answers to our questions about the documents after her department declined our FOIA request. Fewer projects are listed as "pending," meaning they've been proposed.

"The designations are informal and used only for budgeting and planning purposes," Sullivan wrote. "There is nothing binding about the terms in this context; they are in fact determined by DCD TIF staff as a way to prioritize potential expenditures."

But that's not substantially different from the way it works with the city's official budget, which the mayor publicly introduces as a set of "recommendations" and which changes throughout the year depending on how closely projections meet reality.

Planned minimum expenditures total out to $1,304,671,279. These committed costs put the City of Chicago's TIF fund $55,454,056 in the red. And this is before any new TIF agreements that might have been made since this data was all prepared and published in June 2009. As a best-case scenario based on this data, the City would expect another net gain of $77 million, and would not commit any new costs, and the fund would find itself about $22 million ahead at the end of 2009.

When Alderman Thomas Allen asked the simple question about plugging the budget gap using TIF funds, he was told that "it can't be done."
ALLEN: Why can't we take resources that are in the TIF districts, income, and use it to plug this hole. Why do we give this money to private developers? Let's give it to the citizens. That can't be done, according to a city spokeswoman. She says state law does not permit Chicago to spend TIF money on general expenses.
After Mayor Daley spoke about the budget on October 21st, Progress Illinois had a simple question for him.

Listening to his speech, you'd never know that the TIF network is the single largest tool that the city has at its disposal to balance the budget and jumpstart the local economy.

So why the silence?

Indeed, Anna Tarkov quipped, "The silence from the 5th floor is deafening."

With a $500 million shortfall in the general budget, and a supposed billion dollar slush fund apparently running another $55 million in the red, it's no wonder you can hear a pin drop.

Mayor Daley's Empty Property Tax Rhetoric

Originally posted at Examiner.

The City of Chicago finds itself, like much of the rest of the country, in dire financial times. The glimmer of hope on the horizon was, at one point, the 2016 Olympics. The Mayor (and nearly everyone else in politics) seemed certain that the games would call Chicago home seven years from now. So sure were the City's politicians of the imminence of the games and their being carried out successfully, that the City Council passed an unanimous ordinance to guarantee the games financially. Billions were going to flow into Chicago, and all would be well. "Pay no attention to the $500 million budget gap behind the curtain!" bellowed the Great and Powerful Daley. Then the hammer fell. A woman in Copenhagen gasped. Chicago was eliminated first from Olympic contention. Immediately eyes began to peer behind the curtain. How would Mayor Daley close such an enormous defecit in the City's budget? Credit where it's due, the Mayor refuses to raise property taxes.

"You can't [raise property taxes] ... That would hurt people tremendously," Daley said.

"You can only take so much. People are being laid off on a daily basis. People are getting cut back. They don't have the money anymore. Government has to look at itself and find out what they can live with and what are their priorities. Simple as that."

Spoken like a true fiscal conservative.The charge levied that the City must become a smaller, efficient, responsible government is something one might expect a libertarian to charge a government with doing. If only the Mayor's actions actually bore this philosophy out in practice, he might not find himself in such dire straits, both financially and politically (the budget gap has contributed to Daley's lowest approval rating ever, 35%).

The truth behind why a property tax hike won't happen would appear to have nothing to do with how much the government is willing to take from its citizens. As Ben Joravsky and Mick Dumke at the Chicago Reader have worked tirelessly to shine light onto Mayor Daley's shadow budget created by Tax Increment Financing, it becomes abundantly clear that a property tax hike would do little to affect operating budgets, while pouring more money into what ultimately amounts to a personal slush fund for the mayor to utilize to play favorites among clout heavy developers, politically powerful alderman, and to throw a little corporate welfare in for good measure.

As Joravsky and Dumke point out, "When the City Council creates a TIF district—and in all our years of observing, it's always at Mayor Daley's urging—it typically freezes the amount of property tax dollars that the schools, parks, county, and other taxing bodies get from that area for 24 years. Any extra tax revenue generated during that time flows into the TIF account."

This works as the values of properties increase. If a TIF District is created with a base assessed value of $1 million, then for the next 24 years, schools, parks and other city entities that might draw on property taxes for operating revenue, receive revenues as taxed on $1 million. This isn't even indexed for inflation or cost of living, so that as teachers get paid more, or materials simply cost more over time, each of these disctricts necessarily has less money to rely on. Costs go up, but incoming revenue remains the same. The schools and parks and other agencies find themselves in a precarious position. They must raise taxes to remain operating, but if they raise taxes too much, people will simply leave. This is the same position Mayor Daley finds himself in with the City's operating budget on the whole.

According to research done by the folks at The Windy Citizen, TIF Districts now cover over 30% of the City's physical area. Most importantly, they cover the areas of Chicago that generate the highest amounts of taxable revenue. For an example, one need look only as far as one of the most recently retired TIF Districts, the Central Loop District.

When it was created in 1984, the Central Loop District had an estimated assessed value of $985 million. It's estimated assessed value in 2005 was $2.6 billion. Over those 21 years, the value of the property in the Central Loop increased by 163%.

What this really illustrates is that a property tax hike would do little good. If the property tax rate was raised by 1%, the amount of additional money going into the City's operating budget would increase by 1% only on the original $985 million, an increase of $9.85 million in operating revenue. In conjunction, the TIF would see its revenues increase by 1% on the additional property value. That would be 1% on $1.615 billion, or $16.15 million to the TIF, rather than to the City's operating budget. Where this money goes is largely at the discretion of the Mayor himself.

Mayor Daley is talking the talk of smaller, responsible government, in lieu of pillaging his citizens by raising their property taxes. With light beginning to shine on his shadow budget slush fund, his true purpose may be to divert as much attention away from TIF as possible. If he sounds responsible, perhaps Chicago won't find out just how shadowy he is. Pay no attention to the man behind the curtain.

Obama Calls Off the Dogs

Drug-sniffing, that is. In probably the first common sense measure the administration has taken in its first nine months, President Obama has finally called on federal prosecutors to stop going after medical marijuana users that are acting within the laws of their own states.

Under the policy spelled out in a three-page legal memo, federal prosecutors are being told it is not a good use of their time to arrest people who use or provide medical marijuana in strict compliance with state law.

The guidelines being issued by the department do, however, make it clear that federal agents will go after people whose marijuana distribution goes beyond what is permitted under state law or use medical marijuana as a cover for other crimes.

The memo advises prosecutors they "should not focus federal resources in your states on individuals whose actions are in clear and unambiguous compliance with existing state laws providing for the medical use of marijuana."

The new policy is a significant departure from the Bush administration, which insisted it would continue to enforce federal anti-pot laws regardless of state codes.

"It will not be a priority to use federal resources to prosecute patients with serious illnesses or their caregivers who are complying with state laws on medical marijuana, but we will not tolerate drug traffickers who hide behind claims of compliance with state law to mask activities that are clearly illegal," Attorney General Eric Holder said in a statement.

Unfortunately, while this is a step in the right direction, it's not really changing things in the way of the federal government backing off of states rights.

And while the policy memo describes a change in priorities away from prosecuting medical marijuana cases, it does not rule out the possibility that the federal government could still prosecute someone whose activities are allowed under state law.

The memo, officials said, is designed to give a sense of prosecutorial priorities to U.S. attorneys in the states that allow medical marijuana. It notes that pot sales in the United States are the largest source of money for violent Mexican drug cartels, but adds that federal law enforcement agencies have limited resources.

So we're giving our prosecutors some "priorities" about who to go after. This is a nice token gesture in promoting some freedom with regard to marijuana use for medical purposes. It's hardly a groundbreaking step in federal overstepping of bounds, however.

Proof That True Racists Are Just Plain Ignorant

There is so much insinuation these days that anybody opposing President Obama's policies is somehow racist, that running across an example of pure, virulent racist discrimination like this is akin to walking out of a dark basement into the noonday sun.

HAMMOND, La. (AP) - A Louisiana justice of the peace said he refused to issue a marriage license to an interracial couple out of concern for any children the couple might have. Keith Bardwell, justice of the peace
in Tangipahoa Parish, says it is his experience that most interracial marriages do not last long.

Neither Bardwell nor the couple immediately returned phone calls from The Associated Press. But Bardwell told the Daily Star of Hammond that he was not a racist.

"I do ceremonies for black couples right here in my house," Bardwell said. "My main concern is for the children."

Bardwell said he has discussed the topic with blacks and whites, along with witnessing some interracial marriages. He came to the conclusion that most of black society does not readily accept offspring of such relationships, and neither does white society, he said.

"I don't do interracial marriages because I don't want to put children in a situation they didn't bring on themselves," Bardwell said. "In my heart, I feel the children will later suffer."

If he does an interracial marriage for one couple, he must do the same for all, he said.

"I try to treat everyone equally," he said.

Really? Because it seems to me you're certainly not treating interracial couples equally to other couples. I don't know, just an observation.

And another observation. What the hell kind of explanation is it that this is for the good of their potentially future children? The last time I checked, there are quite a few people that get married that never have children. And quite the opposite, there are plenty of people that have children without ever being married.

This moron denying these two people their rights protects nothing. If they want kids, they'll have kids, whether they're married or not. If they don't want kids, now you've denied them the right to marry on behalf of an entity that simply does not exist.

This is pure ignorance. And this is true racism.

The Long, Slow Death of Party Politics

There is a phenomenal article posted today at Mises.org about the state of politics in the United States. The commentary on the state of party politics, and the reactionary tendencies of both the Right and the Left is spot on. The state of both sides simply trending toward differing forms of authoritarianism is also right on the money, and the state of our Corporatist (not Capitalist) economy of huge entrepreneurial businesses in bed with their favorite government officials is scary accurate. The article is titled "The Death of Politics." The following is a good excerpt, but please read the whole thing. Oh by the way, Karl Hess wrote the article 40 years ago.

Political parties and politicians today — all parties and all politicians —question only the forms through which they will express their common belief in controlling the lives of others. Power, particularly majoritarian or collective power (i.e., the power of an elite exercised in the name of the masses), is the god of the modern liberal. Its only recent innovative change is to suggest that the elite be leavened by the compulsory membership of authentic representatives of the masses. The current phrase is "participatory democracy."

Just as power is the god of the modern liberal, God remains the authority of the modern conservative. Liberalism practices regimentation by, simply, regimentation. Conservatism practices regimentation by, not quite so simply, revelation. But regimented or revealed, the name of the game is still politics.

The great flaw in conservatism is a deep fissure down which talk of freedom falls, to be dashed to death on the rocks of authoritarianism. Conservatives worry that the state has too much power over people. But it was conservatives who gave the state that power. It was conservatives, very similar to today's conservatives, who ceded to the state the power to produce not simply order in the community but a certain kind of order.

It was European conservatives who, apparently fearful of the openness of the Industrial Revolution (why, anyone could get rich!), struck the first blows at capitalism by encouraging and accepting laws that made the disruptions of innovation and competition less frequent and eased the way for the comforts and collusions of cartelization.

Big business in America today and for some years has been openly at war with competition and, thus, at war with laissez-faire capitalism. Big business supports a form of state capitalism in which government and big business act as partners. Criticism of this statist bent of big business comes more often from the Left than from the Right these days, and this is another factor making it difficult to tell the players apart. John Kenneth Galbraith, for instance, has most recently taken big business to task for its anticompetitive mentality. The Right, meantime, blissfully defends big business as though it had not, in fact, become just the sort of bureaucratic, authoritarian force that rightists
reflexively attack when it is governmental.

The Left's attack on corporate capitalism is, when examined, an attack on economic forms possible only in collusion between authoritarian government and bureaucratized, nonentrepreneurial business. It is unfortunate that many New Leftists are so uncritical as to accept this premise as indicating that all forms of capitalism are bad, so that full state ownership is the only alternative. This thinking has its mirror image on the Right.

It was American conservatives, for instance, who very early in the game gave up the fight against state franchising and regulation and, instead, embraced state regulation for their own special advantage. Conservatives today continue to revere the state as an instrument of chastisement even as they reject it as an instrument of beneficence. The conservative who wants a federally authorized prayer in the classroom is the same conservative who objects to federally authorized textbooks in the same room.

Obama to Negotiate with Raging Wildfire

The President plans to make the wildfire understand that our difficulties are shared difficulties, that it's not man against fire, but man and fire working out their differences.

Obama To Enter Diplomatic Talks With Raging Wildfire