Simpson and Gradel regard aldermanic privilege as one root cause of Chicago corruption, writing: “As long as aldermen have the political clout to control zoning, licenses, permits, property-tax reductions, city contracts and patronage jobs, corruption will continue to send aldermen to prison.”
The privilege that formerly allowed for vote-buying schemes and saloon shakedowns now manifests itself as crony meddling in small-business affairs – from signage to sidewalk-café permits to liquor licenses to the right to exist at all. This is to the detriment of entrepreneurs who are ignorant of the game, or refuse to play.
Elizabeth Milnikel Kregor, director of the Institute for Justice Clinic on Entrepreneurship at the University of Chicago, has described the effects of concentrated power among aldermen on small businesses. One of her clients wanted to open up a day care in 2010 but was told by a local alderman that the area had enough already.
“She has held this building and paid property taxes for over a year now, [but] she hasn’t even been allowed to start building it up as a day care,” Kregor said. “Meanwhile this block has yet another empty building sitting there.”
The problem at hand could not be more evident: aldermanic privilege – a political custom predating the Great Chicago Fire – is getting in the way of residents being able to build a better future for the city. And while the origins of the political-cultural problem of aldermanic privilege are complex, solutions are within reach.
Part of what invites aldermanic interference is a lengthy and costly startup process for small businesses. Vox’s Matthew Yglesias described starting a professional-services business in Chicago as a “ dystopian nightmare.” It comes as no surprise then that Chicago’s rate of entrepreneurship is the second-lowest among the country’s 15 largest metropolitan areas.
At the very least, the arbitrary regulatory power wielded on a case-by-case basis by Chicago aldermen must be eliminated. They have proven incapable of applying it fairly and consistently.
Along with separating political elements from business creation, the city inspector general’s office should be given increased authority over aldermen and their staff. When the inspector general position was created in 1989, aldermen exempted themselves from its scrutiny, opting instead (20 years later) to create a legislative inspector general’s office to provide aldermanic oversight. Legislative Inspector General Faisal Khan sued the city last year after his office was underfunded.
Aldermanic privilege stands as a costly monument to Chicago’s historically rapacious political culture, and has done little more than to bend the histories of neighborhoods toward the whims of the political elite. Regulatory reforms and better oversight are simple steps toward razing it.
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