Mayor Brandon Johnson’s latest budget offers more taxes, more borrowing, and precious little fiscal discipline. Chicago needs spending reductions, meaningful labor reforms and a renaissance in productivity before the city goes broke
Even the Chicago Tribune has apparently had enough of the fiscal insanity at City Hall. In two remarkably sensible editorials published October 22 & 23, the Tribune editorial board took Mayor Brandon Johnson to task for presenting what amounts to a political campaign document masquerading as a municipal budget, and for failing to confront the unions whose cooperation will
We don’t often find ourselves congratulating the Tribune editorial board in these pages, but credit where credit is due. In this case, they’re making a great deal of sense. The only problem is that their recommendations don’t go nearly far enough. Chicago doesn’t just need to negotiate a few concessions from its municipal unions. It needs a fundamental transformation in the way it spends taxpayers’ money, manages its workforce, and delivers basic municipal services. In short, it needs a productivity renaissance. And unless that happens, the city is going to continue down the road toward fiscal catastrophe, taking its taxpayers and businesses along for the ride.
Let’s begin with the numbers. Chicago faces an approximately $882 million shortfall in its 2027 budget, and our illustrious mayor has proposed a $17.6 billion spending plan that relies heavily on additional taxes, including another attempt to impose a head tax on major employers. This latest version would charge qualifying businesses $25 per employee per month, a particularly ingenious way to discourage the very activity Chicago desperately needs: private-sector employment. The mayor also proposes higher taxes on cloud computing and other business activities, along with hundreds of millions of dollars in borrowing to cover legacy liabilities, including legal settlements.
Meanwhile, the Tribune points out the administration proposes more than $130 million in additional spending on various initiatives, including tree trimming, violence intervention, mental health services, and summer youth employment. Some of these programs undoubtedly have merit. But merit isn’t the same thing as affordability. When you’re running a household and your expenses exceed your income, you don’t solve the problem by taking out another credit card and buying more stuff. You reduce your expenses, increase your productivity, or find some combination of the two. Apparently, that elementary principle of financial management has yet to penetrate the fifth floor of City Hall.
Now, let’s be clear about something. Chicago is legally required to adopt a balanced budget. But balancing a budget on paper and actually living within your means are two entirely different things. You can fill a budget hole with borrowing, temporary revenues, accounting maneuvers, and tax increases, but that doesn’t necessarily correct the underlying problem. If your recurring expenses continue to exceed your sustainable recurring revenues, you’re simply postponing the reckoning. Worse, borrowing to cover obligations that should have been paid out of current revenues can leave future taxpayers paying interest on yesterday’s mistakes. There are legitimate reasons for a municipality to borrow money. Building a bridge, replacing a water main, or financing infrastructure that will serve generations can justify long-term debt. But borrowing to pay yesterday’s bills while refusing to confront today’s expenses is another matter entirely. Chicago has played variations of this game for years, under administrations aligned with both political parties and across multiple mayoralties. Johnson inherited a serious structural problem, but his latest proposal offers little evidence that he intends to solve it.
The Tribune makes another important point: Chicago’s municipal unions need to come to the negotiating table and participate in the solution. This is particularly interesting because two Service Employees International Union locals that supported Johnson in the past have now endorsed Illinois Secretary of State Alexi Giannoulias in the 2027 mayoral race. Apparently, even some of the unions that helped put Johnson in office are reconsidering their political investment. The Tribune suggests organized labor should negotiate with the City Council coalition that has challenged Johnson’s budget proposals, even if the mayor himself refuses to demand concessions. That’s a reasonable suggestion. Labor contracts, healthcare expenses, wage increases, staffing levels, and work rules all deserve examination. The Tribune cites examples from Los Angeles, where municipal unions agreed to measures such as unpaid time off and adjustments to overtime arrangements in response to budget pressures. Why shouldn’t Chicago explore similar possibilities? The alternative is to continue pretending that every contractual obligation is sacred, every existing staffing arrangement is untouchable and every dollar of additional expense must somehow be extracted from taxpayers.
But here’s where I would go considerably further than the Tribune. The problem isn’t merely what we’re paying municipal employees. It’s what we’re getting in return. Productivity matters. Efficiency matters. The ability to accomplish a task promptly, competently, and at a reasonable cost matters. And taxpayers have every right to demand that the people they employ, directly or indirectly, provide a reasonable return on their investment. This isn’t an argument against unions or against paying workers fairly. It’s an argument against treating government employment as an arrangement in which compensation and benefits are endlessly negotiable upward while productivity, accountability, and performance are somebody else’s problem. Any serious negotiations should include not only healthcare contributions and compensation but also work rules, scheduling flexibility, contracting procedures, performance measurements, and opportunities to accomplish more with the resources already available.
Let me offer an example from my own neighborhood, one that has irritated your humble correspondent for years. Chicago’s sidewalks are a disgrace. Walk around many neighborhoods and you’ll encounter cracked concrete, uneven slabs, raised sections caused by tree roots and other obstacles capable of sending an unsuspecting pedestrian sprawling onto the pavement. For older residents, particularly, a fall can be a serious medical event. Broken hips, injured knees, hospitalizations, and long recoveries are not trivial matters. Yet sidewalks in some neighborhoods remain in dreadful condition for years, sometimes decades. The city operates something called the Shared Cost Sidewalk Program, under which property owners contribute toward the expense of replacing sidewalks in front of their properties. The city subsidizes the work, and the program is popular enough that applications can fill up quickly. But why should a basic component of the public right-of-way depend so heavily on whether the adjoining property owner is willing and able to contribute money toward its repair?
Think about the absurdity of that arrangement. We don’t ordinarily tell homeowners that the city will repair the street in front of their house only if they agree to pay half the bill. Streets are public infrastructure. They benefit everyone who uses them, whether they live on the block or are merely passing through. Sidewalks are public infrastructure, too. They’re used by pedestrians, children walking to school, people exercising, delivery workers, commuters, and visitors. Why should the responsibility for keeping them safe be treated so differently? There are other city mechanisms for addressing hazardous sidewalks, and the shared-cost program isn’t the only avenue for repairs. Nevertheless, the larger question remains: Why can’t Chicago establish a systematic, adequately funded, and cost-effective program for maintaining its pedestrian infrastructure? If necessary, the city could spread the expense across general revenues or establish a reasonable property assessment for improvements that directly benefit particular properties. What matters is creating a system that actually gets the work done instead of allowing dangerous conditions to persist indefinitely.
And here’s another interesting observation. A building near mine recently had its sidewalks repaired by a private contractor. The crew arrived, went to work, and finished the job in approximately three days. Three days! Meanwhile, residents elsewhere can wait years for repairs to deteriorating public sidewalks. Now, I’m not suggesting that every municipal sidewalk project is comparable to a private contractor’s job. Public projects have different requirements, and there may be legitimate engineering, accessibility, and scheduling considerations. But the contrast raises a perfectly reasonable question: Why can’t the city deliver comparable speed and efficiency where circumstances permit? Why aren’t we systematically comparing the cost and performance of city crews with private contractors? Why aren’t we measuring how many square feet of sidewalk are repaired per dollar spent, how long residents wait for service, and how frequently completed work requires additional repairs? And why shouldn’t competitive contracting be part of the solution when it can deliver better results at lower cost without compromising safety or quality?
The sidewalk problem is particularly ridiculous because Chicago’s political leadership is constantly talking about getting people out of automobiles and encouraging walking, cycling, and public transportation. Fine. But if you want people to walk, it might be a good idea to provide sidewalks they can walk on without breaking their necks. We spend enormous amounts of political energy arguing about bicycle lanes, traffic patterns, transportation equity, and environmental objectives, yet the pedestrian infrastructure that millions of Chicagoans depend upon remains neglected in too many places. It’s a perfect illustration of what happens when government becomes more interested in announcing lofty objectives than accomplishing mundane tasks. Fixing sidewalks isn’t glamorous. It doesn’t provide the ideological excitement of another progressive initiative. But it is one of those basic municipal responsibilities that distinguish a well-run city from a poorly run one.
The same principles apply throughout municipal government. Why shouldn’t Chicago examine whether certain maintenance operations could be performed more efficiently through competitive contracting? Why shouldn’t it explore carefully supervised employment and training programs that give unemployed young people opportunities to learn useful skills while helping improve their neighborhoods? Why shouldn’t city departments publish understandable productivity measurements so taxpayers can determine what they’re getting for their money? And why shouldn’t labor negotiations include incentives for employees and supervisors who find ways to deliver better services at lower cost? None of this requires treating municipal workers as enemies. Quite the contrary. A workforce that is well managed, properly equipped, and rewarded for accomplishing useful work can be a tremendous asset. But management has to manage, and organized labor has to recognize that protecting the long-term interests of its members requires preserving the financial viability of the government that employs them.
There are legitimate counterarguments, of course. Municipal employees have contracts, pension rights, and reasonable expectations about their compensation. Some city services are already stretched thin, and indiscriminate layoffs could make matters worse. Chicago also has pension obligations, debt-service costs, and legal liabilities that cannot simply be wished away. Johnson argues his proposed taxes would protect essential services and place more of the burden on businesses and those with greater financial resources. These considerations deserve serious attention. But none of them excuses the city from examining its expenditures, measuring performance, or distinguishing essential services from discretionary spending. Nor does calling a tax progressive make its economic consequences disappear. Businesses respond to costs. Employers can reduce hiring, relocate operations, raise prices, or decide that Chicago is simply too expensive a place to expand. The ultimate burden of a business tax doesn’t necessarily stop with the business that writes the check.
That’s why the current budget debate should be about something much larger than finding another $882 million to close next year’s gap. Chicago needs a multiyear plan to bring recurring expenditures into line with recurring revenues, preserve essential services, improve productivity, and restore confidence in the city’s financial management. That means identifying genuine savings, not merely shifting expenses into another fiscal year. It means negotiating with unions rather than pretending labor costs are beyond discussion. It means reviewing procurement, overtime, healthcare costs, staffing, and contracting practices. It means protecting the city’s capacity to maintain its infrastructure while demanding better results from every dollar invested. And it means acknowledging that a city’s prosperity ultimately depends on the people and businesses that generate the wealth government taxes and spends.
So kudos to the Chicago Tribune for recognizing that organized labor needs to participate in solving this crisis. But bringing the unions to the table is only the beginning. What Chicago really needs is a renaissance in productivity, a citywide commitment to accomplishing more with less waste, better management, and a renewed understanding that public employees work for the public. We need a government that fixes sidewalks instead of leaving pedestrians to break their bones, that encourages employers instead of penalizing them for creating jobs, and that treats taxpayers as citizens entitled to competent services rather than an inexhaustible source of revenue.
The choice is not between protecting municipal employees and protecting taxpayers. In the long run, both depend on a financially healthy, economically productive city. If the unions, the City Council and the mayor cannot recognize that shared interest, the consequences will eventually catch up with all of them. Chicago cannot keep borrowing from tomorrow, taxing its employers and neglecting the basics while pretending that the arithmetic will somehow work itself out.
The city needs to stop asking how much more money it can extract from Chicagoans and start asking how much more value it can deliver for the money they’re already paying.
That’s what a real budget discussion would look like. And it’s long overdue.
George Shay is a conservative activist and writer. His Common Sense Substack can be found here.
