Chicago’s ‘two city’ tale comes with a warning
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They call Chicago the city of big shoulders. Much like Dubai’s emergence from virtually nowhere in the last 20 years to become a global city, Chicago pulled itself up from its bootstraps in the mid-19th century to turn into America’s industrial hub.
Unlike its peers — Detroit, Cleveland and Baltimore — it survived the obliteration of America’s industrial heartlands in the past 40 years by learning to “pour new wine into old bottles,” in the words of Richard Longworth, a leading chronicler of today’s Chicago. Where once it thrived on slaughtered hogs, smelted iron and freight trains, now it hosts corporate headquarters, boasts new economy start-ups and links to other global hubs via O’Hare airport. Today’s Chicago prefers to benchmark itself against Shanghai, São Paulo, Paris — and, yes, Dubai. But is it paying too little heed to what is under its nose?
The fate of a city’s hinterland is one that haunts every great metropolis. For London, it is the rest of the UK which sometimes feels like a different country. For Dubai, it is the Wahhabi heartlands of the Arabian peninsula. For Chicago it is the US Midwest.
In the past, Chicago acted as the locomotive of its hinterlands — in Mr Longworth’s words — buying the Midwest’s farm produce and other raw commodities and then converting them into products. The city was linked umbilically to its surrounding geography and vice versa. Today, it mostly hovers above its hinterlands. But in some ways it is also parasitic on them. Much like the giant sucking sound of London hoovering up the UK’s talent, Chicago takes the best and the brightest from the small towns of America and plugs them into the global economy. Chicago’s success is no longer symbiotic with its rural neighbours. In some ways it comes at their expense.
Much like London, Chicago’s erstwhile middle classes also find it increasingly hard to keep up with rising costs. As the most educated people move to global cities, those with fewer qualifications find themselves increasingly shut out.
In 2011, Boris Johnson, London’s mayor, saw the downside when the UK capital’s fringes went on the rampage for several days, smashing up shops and burning cars — looting what they could not have. Dubai overcomes this problem by importing its labour from poorer countries and putting them on visas that can be annulled at short notice. Chicago has no such luxury.
Last month, Rahm Emanuel, Chicago’s mayor, saw the consequences of “two Chicagos” when he was given a close run for re-election by Jesus “Chuy” Garcia, for the job. Mr Garcia, a Mexico-born trade unionist, had almost no money for his insurgent campaign. Mr Emanuel raised an estimated $30m from Chicago’s sparkling downtown. In the event, Mr Emanuel won the run off comfortably. But it was reminder that a city’s success breeds its own backlash.
Finally, there are finances. Although Abu Dhabi has big oil wealth, Dubai recently discovered the pitfalls of falling global oil prices. As host to the world’s busiest international airport, it depends on global growth for its fiscal health. Perhaps it may soon be forced to tax its white collar expatriates. But therein lies a dilemma. Cities like Chicago attract business by keeping business taxes low and making it an attractive place to live. In London’s case, everything is so pricey, it retains wealthy foreigners only by taxing them lightly.
Yet mayors cannot fix the “two cities” problem on their own. They need money for schools, transit and housing — revenues that can only be raised via higher taxes and user charges. But lifting these, in turn, may deter the very people who make the city global.
As Chicago shows, we live in an age of the rising global city. But Chicago’s tale also comes with a warning. We ignore at our peril those who have been left behind.