On Gentrification in Chicago

Bruce Dixon, September 1998

Q. What should happen with a large tract of land that is near downtown and the lakefront, but currently has a housing project located on it? Simple economics (and past history in Chicago) says that there are hundreds of people willing to pay several hundred thousand dollars for townhouses located on this tract, due to its proximity to downtown and the lake. Evidently there is a HIGH demand for expensive housing near downtown and the lakefront. This demand is so high that developers can make millions, even after displacing all the current residents, buying out the current owners, tearing down the existing low-income housing, and constructing new housing and infrastructure.

A. "Simple economics"? Supply? Demand? What on earth are you talking about, friend? Gentrification is not a force of nature, nor is it driven by the supply-and-demand economics we learned in the fifth grade.

The current gentrification model here in Chicago, and I strongly suspect elesewhere, is initiated by and relies heavily upon government intervention and the mobilization of public resources on behalf of upscale developers at the expense of developing the areas that developers are less interested in.

To deal with your last point first, the developers of prime near-downtown Chicago areas such as the Cabini-Green and Near North ares almost NEVER PAY the cost of buying out most of the current owners NOR that of tearing down the existing housing.

The Daley administration uses eminent domain and a ridiculously aggressive demolition policy to tear down at public expense and often without a hearing existing housing in minority areas that could be rehabilitated. These are uses of PUBLIC power to appropriate the land and PUBLIC resources to demolish the structures thereon for the exclusive benefit of the said developes, and at the expense of the rest of us.

Next the city sells the cleared land at far below market value, or sometimes makes an outright gift of it to the favored developers, along with an initial special appropriation for the upgrade of city services and infrastructure thereon. Further infrastructure upgrades such as sidewalks, tree planting, landscaping, street lighting improvements, sewers, extra sanitation workers, etc., are paid for by declaring the "blighted" area a Tax Increment Financing or TIF district. In a TIF district, any increase in property tax levels over the rate currently in efect may be spent ONLY on improvements inside the affected district.for 22 years. Thus the schools, parks, fire, police and other services in the larger city are deprived of the rise in tax revenue for that period, and all the homeowners and business in the rest of the city have to take up the slack. If you're a developer or wealthy property owner inside the TIF district, ALL your tax money is spent DIRECTLY in your area. You get more frequent garbage pickup, in some cases street sweepers with hand brooms every morning) better sidewalks, streets and street lighting, more cops new police and/or fire stations, better better equipped local schools, etc.

And when the city decides to give this tax break NOT to an area where poor people still live and need better services, more jobs to be relocated nearly, and so forth... When it gives these breaks in areas like the former Cabrini and Near North sites on land which was going to be the site of lucrative development anyway, the whole package of free and below market land taken from poor people and cleared at city expense and wrapped up in special tax breaks amounts to a substantial windfall and an ongoing subsidy to a handful of favored developers at the expense of ALL the rest of us.

And by the way, we are forced to moved to equally bad or worse housing in the suburbs. Check out the articles about where the former residents of Cabrini are ending up in the Chicago Reporter online at http://www.chicagoreporter.com/, or email me for the number of the Natalie Voorheis project at the U of I Chicago's study of the same thing.

As such, gentrification is almost always a displacement of poor residents to remote and les economically favored areas with similar substandard housing, and a theft of public and private resources from other poorer neighborhoods which deserve to be improved for the people who aready live there, and should be understood and resisted as such. The people in these neighborhoods (before they're moved out, at least) are almost always nonwhite. So when you and our young "Devil's Advocate" justify or excuse public policies like this as "simple economics" you are excusing theft. From black people. Do think about it.

Supply and demand my foot.

Bruce A. Dixon Chicago