Chicago is the birthplace of Barack Obama's political career. He once worked there as a community organizer, and in Dreams from My Father, he gently chided what he saw of the city's machine political culture. As a politician, he would later embrace that culture.
There are two main political factions in Chicago, both within the Democratic Party. There's the good-government liberal side, and then there's the Machine. Obama is a man who speaks the language of the good-government side, but got ahead in life by forging alliances with the much more powerful Machine side -- with such figures as Emil Jones, Todd Stroger and Mayor Daley (and of course the city's new, non-resident mayor).
We heard a lot of Obama's reform schtick during the 2008 election. But his total failure to advance any serious or meaningful reform proposals in Illinois (he did advance at least one not-so meaningful one) is a major theme I addressed in The Case Against Barack Obama. I contend in Gangster Government that candidate Obama promised to fix a broken Washington, but that as president, true to his Chicago roots, has instead exploited its brokenness wherever possible in order to expand his power, help his friends, and punish his enemies.
A major problem with Chicago's political debate is that its two sides are not truly complementary. Both share the same vice, and each feeds off the other's defects. The crooked Machine politicians pocket money and/or find ways to use the public fisc to maintain standing armies of election workers. The liberals favor big government, higher taxes and more robust services, and they fight corruption because it limits big government's ability to deliver.
What Chicago's two sides have in common is a fatal dependence on big government. The more the liberals push for big government and central control, the more money and power the Machine wields. To use a well-known example, you cannot have Tony Rezko without big government. And no matter how good its intentions, big government plans create rats' nests of rent-seeking Tony Rezkos as an inevitable consequence.
One of the many topics I explore in Gangster Government is Obama's $800 billion stimulus package, which is partly responsible for the reaction we saw this weekend -- Congress has just agreed to cut discretionary spending for the first time since I've been in Washington. The stimulus represented the intersection of the worst in both sides of Chicago politics. We can view it as a massive vote-buying scheme (which probably backfired), or as an attempt to pad the bottom lines of a few friends, but we also have to look at it as a power grab that was financed by the taxpayers.
The Wall Street Journal editorial board aptly remarked at one point that Obama has turned the government into the world's largest private equity firm. This makes sense -- Obama did bail out two automakers that should have been allowed to fail, with the very specific purpose of saving the UAW. But with the stimulus, whose cost was ten times as great, Obama said he wanted to create “not just any jobs [but] jobs that meet the needs we’ve neglected for far too long and lay the groundwork for long-term economic growth.”
The translation is that Obama used a trillion dollars in taxpayers' money not to restore the economy, but to re-shape it along the lines he thinks to be the future -- the "jobs of the 21st Century." It's a power play for Obama, but it's a game whose dangers to the economy go well beyond even the waste of a trillion dollars. We saw in Spain how government incentives for things without genuine market demand (green energy) created huge asset bubbles that have since collapsed and pummeled that nation's private sector.
Obama's administration is doing this folly one better. One clear example: His economic advisors have bragged that for every dollar the stimulus puts into "clean energy" programs (this category includes a number of initiatives, including weatherization and high-speed rail), private investors are pouring in more than twice as much. What this means is that in addition to the government waste, hundreds of billions in perfectly good private investment dollars have been diverted away from worthy economic enterprises that meet market demand and can create sustainable jobs. All of that private money has gone into chasing government subsidies. The economic damage this creates is literally incalculable -- something Bastiat would describe as a "hidden cost."
Whatever its effect on the economy's health, the stimulus definitely gave Obama a healthy grip on the economy. Gangster government is about expanding government power to help friends and punish enemies. President Obama's resistance to any recissions of his stimulus funding is a reaction in protection of his own power, as was his extreme reluctance to allow even the tiny cuts we just saw.
This weekend's spending debate -- and the coming, larger debate over the next year's and the next decade's budget -- occurs not in Chicago, but in Washington, where conservatives are a viable faction. And it's a good thing. The modern Right brings an understanding to the spending question that both Chicago factions lack: A government that picks winners and losers is inevitably a government full of corruption and cronyism. Limited government is the only antidote to a world where lobbying Congress has become a major or even the main business strategy for many companies.
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Jan '11
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Yes, welcome David Freddoso.
You write that Chicago's two sides have in common "a fatal dependence on big government." Fatal to whom? Not to them, as the rest of your post shows.
No, the only fatality of the criminal combination of big government liberalism and big government machine politics is to the city that is infected by those sick organisms.
You can find the same thing in Detroit, in Newark, in Cleveland and in any other city where Democrats have had full sway for decades.
If you want to look at Philadelphia, you have the union-machine-rowhouse Democrat politics of Bob Brady and Johnny Dougherty, and the middle-class, nicey-nice, Center City and Mount Airy element of liberals and lawyers who support Zach Stalberg and the Committee of Seventy.
One side is to do the dirty work fit for ethnics, and the other side's role is to tsk-tsk such rude behavior while taking their seats on the boards and commissions that the dirty work funds.
Let me know when, like Ida Tarbell, Upton Sinclair, and Lincoln Steffens, your work leads to indictments and Democrats in orange jumpsuits.
Until then - good luck to you.
Dec '10
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
That would not be the Republican Party.
Time to throw all of the bums out by electing a third-party. Democrats gleefully encourage it, assuming it a sure formula for their own successful election. That is not a reason not to do it.
A conservative minority has always fought Republicans for power in Washington. Time for conservatives to realize their dream: “Free at last! free at last! [one day we will] thank God Almighty, we are free at last!”
Nov '10
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Reading your analysis of the Obama stimulus, which I agree with completely, I started wondering how many Republican were duped into voting for it. I thought it was going to be a high number but I happily discovered it was only three, Specter, Snowe and Collins in the Senate and none in the House.
I hope I have that right although I thought Specter was already a Democrat by that time. If so, then only two Republicans voted for it, and those two would have been expected to go for it.
May '10
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
I read "The Case Against Barak Obama" before the election. I wish everybody had. I'm planning on reading "Gangster Government", too, and expect it to be as good as "The Case Against" but, it probably won't be a pleasurable read.
Jul '10
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
As was well documented in David McCullough's book, Truman, Harry S. Truman was another product of Democrat machine politics. Despite a rough first term, Truman was able to eek out a victory over Dewey for re-election and is remembered, from a safe distance, as a scrapper with a solid track record. Clearly, Truman's push for socialized medicine failed in the face of rising anti-socialist sentiment, but is there a useful comparison to be made between these two Presidents and the machines that created them?
Edited on Apr 10, 2011 at 2:19pmRe: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Quite true! What's most incredible now, though, is to see the GOP in Congress actually cutting spending below last year's level. Mind you, it's not much of a cut, but go back five years and look at how far talk of spending cuts went then. DOA, and mostly because of Republican appropriators.
I'm not much of an optimist when it comes to our system, but for my mere decade in DC, we're on uncharted ground. I will be very surprised if conservatives win on entitlements, but obviously we've gotten somewhere. Entitlement reform has just been proposed with specifics and numbers by one of the two major parties. This is also a completely new development.
Jun '10
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Excellent article, Mr. Freddoso. John Stossel just had a complimentary/companion piece this weekend on freeloaders. He ended with the crony capitralists. This country is on the brink. The American people are beginning to awaken. I pray it is not too late.
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Everything I know about the Pendergast Gang I learned from a cranky 80-year-old sports writer at my old neighborhood newspaper in Brooklyn. So I feel unqualified to comment on the topic. It's an interesting idea, though.
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Thank you, sir. And I'm sorry it can't be more pleasant -- just as I could say about the Obama presidency in general. :-)
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Thanks! I don't know how many people here are fans of "The Wire," but in the second season, there was an incredible quote from the head of the stevedores' union -- something about how "We used to make s---- in this country, we used to build s----. Now all anyone does is reach into the next guy's pocket." Truer words are rarely spoken.
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Specter was still a Republican at that time, and in fact he cited the hatred he received from that vote as one of the main reasons he switched parties.
Speaking of which, doesn't it give you a wonderful feeling to look back at his party switch? Remember how that was supposed to be the end for Republicans? They had pushed away all of the moderates because they were fanatics? Somehow, it didn't end up that way.
It's so funny to see that Specter dug his own grave that way. I was devastated by his narrow victory in the 2004 primary (I was in Allentown covering it that night), but pleasantly surprised by his subsequent service as judiciary chairman. Specter's proudest moment probably came during the Alito hearings, when he told off Sen. Kennedy (God rest his soul).
With that service and with his 2009 party switch, Specter did immense good for a conservative cause he didn't even believe in. It serves as a lesson for how a conservative primary challenge can succeed, even when it fails.
Dec '10
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
David Freddoso, Guest Contributor
What's most incredible now, though, is to see the GOP in Congress actually cutting spending below last year's level. [...]· Apr 10 at 4:26pm
Implicit in any satisfaction of the recent cut without acknowledgement of its infinitesimal amount in relation to the inflated baseline that ensued from the 2008 election period crises is correspondingly an acceptance of career politicians’ legerdemain to make so-called non-recurring spending programs a permanent part of the inchoate trillions of dollars they continue to spend.
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
Freesmith: You write that Chicago's two sides have in common "a fatal dependence on big government." Fatal to whom? Not to them, as the rest of your post shows.
No, the only fatality of the criminal combination of big government liberalism and big government machine politics is to the city that is infected by those sick organisms.
You are absolutely correct. Chicago and Illinois are great examples of this. The state government is now a deadbeat -- not even paying its bills. The city is so far behind on its pension contributions that Mayor Rahm is going to have to take drastic measures that make Scott Walker look like Cesar Chavez if he's going to save the city from itself.
People see Chicago's beautiful downtown -- built on billions of borrowed dollars -- and fail to understand that underneath the golden pavers is the story of a city experiencing a large (if not quite Detroit-like) population loss. Chicago's neighborhoods have been emptying out -- the Census shows a 7 percent population decline in the city over the last decade.
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
We really agree on this, but let's take it for what it is. I like the fact that we're actually discussing spending cuts, which is an improvement from the last time Republicans controlled everything. The good result isn't here yet. In fact, we haven't even stopped digging yet, and even under the best scenario -- the Ryan budget -- we won't have stopped digging (which means balancing the budget) for decades.
But the first step is always to acknowledge that you have a problem. That's where the Congress is now.
Apr '11
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
In retrospect I have to wonder how the Obama Presidency could have been avoided. Apparently writing a book about his drool over Alinsky's darkness wasn't enough. But this isn't the point I wanted to make, the point I wanted to make is that the author makes a distinction between "Gangster Gov't and Big Gov't" somehow intersecting where I believe they are simply opposing sides of the same coin. In other words you cannot have the one with out the other. From my life experience of 40 some odd years in Central Illinois I can tell you that up untill this particular time (Hopefully Changing) we aren't even accoustomed to crumbs from the Big Fed. Oh you should have seen the prepraise of something called "FutureGen" but when it didn't get the go ahead all of our city fathers were looking around saying "something stinks" and "it wasn't me!" I say "hey Big Fed thanks but no thanks" I've sense I was just a tot wondered what those people do and always suspected it was very little. Call it spiritual intuition. Give a listen to episode 64 reference to Pragers thoughts.
Aug '10
Re: Chicago, the budget, and the stimulus: How Gangster Government and Big Government intersect
David Freddoso, Guest Contributor
Thanks! I don't know how many people here are fans of "The Wire," but in the second season, there was an incredible quote from the head of the stevedores' union -- something about how "We used to make s---- in this country, we used to build s----. Now all anyone does is reach into the next guy's pocket." Truer words are rarely spoken. · Apr 10 at 4:40pm
Loved that show and that quote.
I live and work on the Los Angeles-Long Beach Harbor. I've spent many a day in the wheelhouse of a tugboat with men who have spent their lives working the harbor. Invariably our conversations drift to the ghosts of our enconomic past: Todd Shipyard, Southwest Marine, Long Beach Naval Shipyard, Sun Lumber- all gone.
Lately exports are up, but prior to the bust it was just scrap steel and empty containers.