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chicago

Why Won't Conservatives Try To Compete In Chicago?

Another election season is already beginning with candidates coming forward to challenge unpopular Chicago Mayor Rahm Emanuel. But who's the best option for the city's broken finances? Why aren't there any center-right candidates even competing in Chicago? On this installment of "Illinois Rising" Dan Proft and Joe Kaiser discuss the city's challenges and whether or not anyone has a vision to help the city out of its fiscal woes. And while conservatives might not be competing in Chicago, state representative candidate Tonia Khouri joins the show to offer her vision for lower taxes in DuPage County. Also – how real is the prospect for a progressive income tax in Illinois? And what would mean for state taxpayers?

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Resolving Chicago's Debt Crisis: Source Not Size

Right now, Chicago taxpayers are stuck with a seventy-one billion dollar debt load. That means every household is on the hook for eighty-two thousand dollars in government debt. As staggering as that number is, it's not the real issue with Chicago's debt. Pat Hughes explains in this episode of Dollars and Sense. 

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Peddling A Con

Just when we thought that Chicago Democrats couldn't be any more hostile to businesses, Cook County Board President Toni Preckwinkle proves us wrong.  Pat Hughes takes on Preckwinkle in this week's Two Minute Warning.

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Fighting Cultural Colonization

Representative Jeanne Ives is taking heat for standing up to cultural bullies in our schools. Tiny Dancer sues the federal government for trying to make him follow federal law. Will Gov. Rauner follow suit and sign sanctuary state legislation? No action on K-12 school funding this week as IL Senate Democrats are out of town for the coronation of one of their own. Pope Francis calls it "terrible" that children are taught they can choose their gender. Don't tell Chicago Tribune's Kim Janssen who identifies as a "reporter." Dan & Amy covered education funding, sanctuary cities, and Illinois politics with State Representative Jeanne Ives.

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What's At Stake In Democrats' Education Funding Bill

Gov. Bruce Rauner has said he will issue an amendatory veto to the Chicago Public Schools' bailout Democrats are proposing. On this edition of Illinois Rising, Dan Proft and Pat Hughes talk to Illinois Policy's Ted Dabrowski about the history of Springfield bailing out Chicago Public Schools, and how the new legislation would hurt school districts across the state. They also talk to a Republican legislative candidate who is stepping up to challenge a Chicago Democrat representative.

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Did Trump Jr. Commit Treason?

Should Donald Trump Jr. be imprisoned for life or executed? How big a bombshell are the revelations about Trump Jr.? Did Trump Jr. commit treason or was he just sloppy? Either way, the reverberations inside the Left's echo chamber rage. CNN's "sources" get it 200% wrong on Trump-Putin meeting. And Mayoral Emanuel brags about the CTA while Chicago's violence spikes, scandals metastasize, and pension funds face bankruptcy. Dan & Kristen McQueary, editorial board member of the Chicago Tribune, posed these questions and more to Commentary Associate Editor Noah Rothman.

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Democrats' Fake Reform

Lawmakers are trying to rush a budget at the end of special session, so House Democrats finally put forth a plan, which includes a property tax freeze. But the plan offers no real relief for struggling taxpayers. On this edition of Illinois Rising, Dan Proft and Pat Hughes break this down with WirePoints.com's Mark Glennon, and discuss what real property tax relief should look like. They also discuss the soon-to-be insolvent Chicago police pension, and waste throughout Chicago Public Schools, as well as financial recklessness at the county level.

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Dollars & Sense: Chicago Pension Crisis

In twenty-fifteen, the City of Chicago’s two employee pension funds paid out nine-hundred and ninety-nine million dollars to about twenty-nine thousand retirees. The same two funds only generated ninety million dollars in investment income that year. Democrats and union bosses insist we don't need pension reform. Why? Pat Hughes explains on this edition of 'Dollars & Sense.'

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Frustration As High As Morale Is Low

With the city's violent crime rates up and the Trump Administration taking a keen interest in Chicago, where do things stand with rank and file police officers in Chicago? FOP President Dean Angelo talks to Dan and Amy about the issues that are important to members of the CPD.

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Why Illinois Is The Worst Place In America To Own A Home

This morning Dan & Amy reviewed the latest exclusive report on property taxes in the Chicago metropolitan region produced by Proft's Local Government Information Services as reported in community newspapers throughout Illinois. Today's installment: South Suburban Cook County.

Today's and previous reports can be viewed here:

North Shore
http://northcooknews.com/stories/511078338-analysis-north-shore-home-values-fall-while-property-taxes-soar

Lake County
http://lakecountygazette.com/stories/511079966-analysis-soaring-property-taxes-eviscerating-home-equity-in-lake-county

DuPage County
http://dupagepolicyjournal.com/stories/511077658-analysis-property-taxes-rapidly-eroding-dupage-home-values

South Suburban Cook
http://southcooknews.com/stories/511082192-south-suburban-homeowners-suffocated-by-property-taxes

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Is Illinois Past The Point Of No Return? Scott Shellady Thinks So.

Scott Shellady, commodities trader and Fox Business News personality, joined Dan and Amy to offer his opinion on the state of the Illinois economy. 

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FOP's Dean Angelo Responds To Paul O'Neal Police Videos

Chicago FOP President Dean Angelo joined Dan & Amy to discuss the police videos related to the police-involved shooting death of Paul O'Neal.

Angelo said he was concerned that the Independent Police Review Authority (IPRA) was prejudging the case.

Earlier this year, in an interview for Against The Current, Angelo predicted Chicago would experience a bloody summer given the current climate in which police must operate. Chicago just finished the deadliest July in a decade.

View full transcript


DAN PROFT: Good morning. What is up? Dan and Amy; this bit of breaking news, according to the hill and a couple of other outlets. AMY JACOBSON: Yeah. DAN PROFT: A man named Evan McMullen, who is a former CIA Operative and the current Chief Policy Director of the House Republican conference, expected to announce an independent presidential bid today. AMY JACOBSON: What? DAN PROFT: He's going to try to get on 20 to 30 State ballots and his candidacy is specifically focused on stopping Donald Trump. AMY JACOBSON: Yeah well good luck with that. Haven't others tried that before who thought about that? David French... DAN PROFT: We'll have more on that story but this individual is apparently actually doing it. We'll have more on that story but want to return to the issue of the Paul O’Neal shooting since those nine videos were released on Friday: four Body-cam videos, five Dash- cam videos. This is again the 18-year-old black kid, steals a Jaguar, speeding up and down the streets, side swipes one police car that he's coming at head-on which results in one of the officers in that car opening fire and then crashes head-on into another police cruiser and then leaves you know, exits the vehicle that precipitates a chase. He's ultimately shot and killed by Chicago Police. Michael Oppenheimer, the plaintiff's attorney for the O’Neal family had this to say: "These police officers decided to play judge, jury, and executioner." Now you expect a little overheated rhetoric from a plaintiff's attorney but that does not square with what you see on those videos in my estimation. AMY JACOBSON: No in the videos this guy, O’Neal used his vehicle as a weapon. He was trying in my estimation, to run down the police officers and kill them and they fired shots back and there was, like the fog of War, what happened and after the shooting the body cameras picked up this: "No the shots were coming at us when the car was coming at us. That’s-all I heard was shots. I don't know if they fired or not, we came head on. I took off this way, he was coming over this way and when I approached this way, I didn't know if he was armed or not." And that was an officer. DAN PROFT: And so police chief Eddie Johnson said, at a news conference over the weekend : "A lot of people are upset by what they saw, quite honestly they have a right to be upset," which was interesting and the head of the Independent Police Review Authority, Sharon Fairley, said she found the video "shocking and disturbing." So a little bit of judge, jury and executioner from the police department and IRPA side. For more on this, we're happy to be joined by our friend Dean Angelo Senior. He's of course the president of Chicago FOP Lodge 7. Dean thanks for joining us, appreciate it. DEAN ANGELO: You're welcome, good morning. DAN PROFT: So why don't we start with the reactions before we get into the details of the incident at least as memorialized on those videos. What is your response to the quick response or the judgmental response from Chief Johnson as well as the Independent Police Review Authority? DEAN ANGELO: Well, I'll start with the IPRA-those kind of comments coming from someone who is supposed to be doing a fair and impartial and unbiased investigation, right at the onset is a little concerning; and it's part of what I've been talking about for months now, that you have a civilian organization investigating police-involved incidents that don't have the wherewithal to do that or to do so because any investigator involved in police work would never make statements about an investigation that is just beginning, like, say the ones that were made the other day. That's completely unacceptable and another example of how they just don't have a handle on this. AMY JACOBSON: I know it's early in the investigation but do you think those three officers felt that their life was in jeopardy, that's the reason why they shot at Paul O'Neal? DEAN ANGELO: Well it's hard to put yourself in the mindset of the police officers. When they're there you can see the event unfold, it happens in a matter of moments. The reactions that were done were done by individuals that were in a heightened sense of anxiety and a heightened sense of fear that something was about to happen and when you have a situation of this nature, and the policy was changed out of Garry McCarthy, so there's a couple of different issues at hand: we have administrative issues and then we have the incident that resulted in the death of O'Neal. So there's a lot of aspects of this investigation that have to be put together and it's very early right now at this stage. DAN PROFT: But what about this matter of the opening fire, the one officer opened fire, this against the new protocol of not shooting into or at moving vehicles if that's the only weapon that the assailant is using. Now there is a kind of an out. We talked to a criminal defence during last hour who made the point- there's sort of an out that, kind of- you still are allowed to take reasonable precautions and protection of your life. So it seems to me that this is going to be the critical issue in terms of litigating this or investigating it at the IRPA level because the shots that were fired by the first officer at the first car that the assailant came upon, created confusion as to who was firing with officers down the block. DEAN ANGELO: Well the officers that were coming down the block, they were eventually hit head on, had the fear that they were being fired at and they were under the assumption I believe, that the offending vehicle was the one where the shots were coming from. Now I've not seen any case reports, I have not interviewed anybody in this process at this stage so it's very difficult to put yourself in those shoes when these things come out and occur so quickly and we're waiting on further discussion and further discovery and the lawyer you mentioned- the family's attorney, some of the statements he had made prior to even seeing the video were completely inaccurate and some of the statements he's made since, have been extremely accusatory, that there was a conspiracy and that the cameras were shut off on purpose. It's such a far reach but I guess when you can say what you want in certain situations now in Chicago and not be held accountable. AMY JACOBSON: Well the truth of the matter is that we recently received those body cameras- what a week ago? DEAN ANGELO: Right, so I think that one of the officers that were involved although, I believe the one with the camera that wasn't capturing anything during the incident had the camera for about four days and there's a lot of training involved as far as-when it's recording, when it's not recording but also when you are to engage it, when you're not to engage it but then you have to add the heightened stress of this situation on top of everything else. You know when you think you're going to-or you're taking fire and now you're involved in a four-chase and your mindset has to break from that to activate the camera. You know with four days of wearing that device is kind of a far reach in and of itself as well. DAN PROFT: Yeah and we sat down and did an interview for or against the current series on upstream- ideas.com a couple months ago and you said "Get ready for a bloody summer and your prediction, unfortunately, has come true- July, the bloodiest July in a decade. And then we hear, after the shooting and after the suspect had been arrested while awaiting the paramedics, the officers at the scene are talking to one another and the Officer, Ortiz I believe is his name, who apparently shot Mr. O'Neal says: " I hope the guy is going to be alright. I'm going to get crucified." And it seems to me that was a real insight into the mentality that police have in the climate in which they operate. DEAN ANGELO: Well, we have individuals that are involved in doing police work that get stripped of their police powers and their just performing their job. It might not look good on camera but you're taking action that saves your partner or you're taking actions that you perceive to be the proper actions at the time. No-one wants to come on this job or the course of their career and ever fired a weapon yet alone take someone's life. It's extremely difficult for any human being to be involved in that and people forget that because these individuals, these women and men are wearing a blue shirt and I think that's lost on a lot of what's going on right now. It's not your intention to leave your home, go to work and then engage in deadly force. It's not what someone does and have that in their mindset but it's something that you always have to be prepared for and generally, it's based on the actions of the individual that's involved on the other end of these incidents. AMY JACOBSON: Now Dean, do you fear that these three officers will be charged criminally? DEAN ANGELO: No I don't think so. At this stage it's early to tell but it is 2016 in Chicago and we don't know, what to expect. I don't think there was criminal intent in the mindset of any of these individuals. I think that we have a situation, tragic as it was, that will be investigated. If it's investigated based on what occurred, once the evidence comes out and once the statements are considered, I don't think that there's any criminal charges that are available. But again, it is 2016 in the city of Chicago and I wouldn't be surprised what can happen but we're going to be watching this and we have individuals involved with these officers right now talking to them and we'll see what happens. DAN PROFT: One of the comments that was made by Officer Ortiz when he got into the ambulance was rather remarkable and it's kind of been underreported, but he's talking to paramedics and saying: "Where do you want to go- and it's UFC or Christ hospital," and the paramedic says, "Well they don't like police at Christ hospital, they're going to make you wait in the waiting room so why don't we take you to UFC." The idea that there is a hospital in the city of Chicago that has an antagonistic posture towards police as it pertains to providing medical attention, kind of a remarkable statement for a paramedic to make, don't you think? DEAN ANGELO: Well, and the paramedics know, they're in and out of those... [Crosstalk DAN PROFT: I know. ] DEAN ANGELO: ...units or emergency rooms at a regular basis they know everybody and, does it surprise me? No. It is where we are at right now, you know the police have been vilified and it's gone to the emergency rooms. We generally have an amazing relationship with nurses and emergency room personnel so it's kind of sad that's where we're at with that institution. But the paramedic would not have made that type of statement if he didn't have some sort of substance to back it up. DAN PROFT: Well I know. That's the frightening part of it. One on national question before we let you go. Over the weekend the National Fraternal Order of Police, the organization you head up in Chicago, found out that Hillary Clinton is not going to seek that Union's endorsement and Chuck Canterbury, the national FOP president said “It sends a powerful message. To be honest with you I was disappointed and shocked." Do you have any reaction to Hillary Clinton deciding not to seek the FOP endorsement? DEAN ANGELO: Well from what I understand, we've known of this for a couple weeks now. And we're waiting for the national to come out and say something about it but because it is a national process it goes to the national organization. It's their responsibility to reach out and submit a multiple questionnaire for the Presidential Candidates to complete so that they could share that with their Political Committee and then to the memberships throughout the different states and consider an endorsement and I guess Mr. Trump completed his and Mrs. Clinton did not and for what I remember by the release that was submitted to us, was that multiple attempts were made to her camp to get the questionnaire completed so that they could submit it to the committee for review and the time frame came and left and it basically fell on deaf ears and then we were told that in fact they were not going to complete the questionnaire and that's where we're at right now. DAN PROFT: Yeah they have other people completing that 'black lives matter questionnaire'. Dean Angelo Senior, President of FOP, Lodge 7 in Chicago. Dean thanks as always for joining us, appreciate it. DEAN ANGELO: You're welcome. Thank you.

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Faisal Khan Expects Forthcoming Criminal Prosecutions of Current City Pols

"Chicago is the third biggest metropolis in the country, yet it is run like the Wild Wild West."

On this edition of Against The Current (ATC), Dan Proft sits down with former New York City Inspector General (under both Mayors Giuliani and Bloomberg) and Legislative Inspector General of the City of Chicago Faisal Khan.

Khan, who spent four years with the City of Chicago, made the mistake of taking his position clearly not recognizing initially that Mayor Emanuel and the City Council intended him only to serve as window-dressing to give the appearance they were interested in reform.  

Despite this disconnect, Khan discusses the many investigations he initiated and subsequently turned over to the FBI upon his departure which he expects will produce criminal prosecutions of current city officeholders.

Khan's elucidates Chicago culture of corruption wherein politicians' arrogance breeds disdain which opens the door to corrupt dealing. Khan discusses the lessons learned from his experience at the city and how they inform the project he has now embarked upon, Project Six.

Learn about Faisal Khan and his ongoing efforts to help Chicago shed its feudal system of governance on this episode of ATC.

View full transcript


Dan Proft: This is Dan Proft coming to from the Sky Line Club atop the Old Republic Building in downtown Chicago for another edition Against the Current. My guest on this edition is Faisal Khan, a former New York City Inspector General, city of Chicago legislative Inspector General, now the president and CEO of an organization called Project 6 which we’ll learn about on this episode. Faisal Khan, thanks so much for joining us. Appreciate it. Faisal Khan: Thank you for having me. Dan Proft: Why don’t we start before we get to Project 6 and what you're doing currently, let's start with how you came to Chicago because there’s such a New York Chicago deal here, right? Maybe a little bit of an inferiority complex but a lot of the political class as well as people in general kind of measure Chicago by New York in many respects and so as someone who spent a good amount of time working for multiple mayors essentially trying to enforce ethical conduct with the politicians in New York City, can you tell us a little bit about that experience and compare that to your experience four years as the Legislative Inspector General over at the fifth floor. Faisal Khan: Yeah, I'm not going to pander but I do love the city of Chicago. I love everything about Chicago. I love the atmosphere, the culture, the people, there are wonderful things here that I'm now a part of and I've been a part for the last six years by living here as, and being a resident and citizen of this city. But when we talk about what you just mentioned and when we talk about the politics and we talk about the ethics and we talk about the lack of ethics, unfortunately Chicago still is way behind New York City in that area and it's incredibly disappointing considering the one thing probably that I do agree with the mayor on is that Chicago can be a world-class city in so many ways but we are unfortunately severely lacking in the ethical oversight department here. I can tell you that from experience like you said both from New York City, being a prosecutor in New York City, being Inspector General New York City and now working in this city for the last five years. Dan Proft: Tell us a little bit about that because that may be a statement that most people would say that doesn't surprise me except the recent news. In the last year and a half or so you've seen some incredible developments in New York, you know, New York City, New York state kind of controlled by New York City the same way Chicago controls Illinois politically speaking and you saw the Democrat House Speaker Sheldon Silver and the Democrat Senate Majority Leader Dean Skelos both be prosecuted by federal authorities for corruption, both on their way to prison so you see two legislative leaders in New York state go down and of course Chicagoans are saying well, why can't that be us? We'd love to see our legislative leaders imprisoned too. More to the point is so there actually is corruption in New York at the highest levels. It’s being prosecuted but here back in Chicago, it seems like there's this culture of corruption that rises up to the highest levels and there's a lack of prosecution. Faisal Khan: Well, I can tell you that as former Legislative Inspector General, my role was to deal with the city aldermen and to oversee that body and certainly there are levels of corruption within that body that needed to be investigated and I did investigate and we took those investigations and we passed them onto the US Attorney's Office and other law enforcement agencies and hopefully we'll see the fruition of our work soon. There are a lot of similarities, Dan, between New York and Chicago as you just noted and Illinois, I'm sorry, you know, similar party structure, similar issues, similar patterns that we see and I think as I was saying to you earlier before we started, it was simply that comfort breeds longevity and longevity breeds arrogance, arrogance breeds contempt which leads into corruption. Whether it takes a year, five years, ten years, eventually it will catch up with you and so I think you saw that happened in New York with Mr Silver and some of his other elected cronies. These are people who had been in office for so long, used that comfort to their benefit and to their arrogance and that led into the contempt for the system that led to corruption of the system and those individuals taking for themselves whatever they wanted to. Dan Proft: Certainly, we've seen that here obviously with governors going to jail. We've seen it here at the city council level in Chicago with 30 in the last 35 years that have gone to jail but I think the thing that sticks in people's craws is they say okay, fine. You know, these prosecutors, they get the idiot alderman who takes $500 in an envelope over a lunch counter, right? The poor criminal and they don't get the guys that seem to be walking conflicts of interest with security details and $8 million campaign funds, not mentioning any names, Ed Burke, and other politicians who also seem to be inherently conflicted, Mike Madigan writing property tax law while practicing property tax appeals, that have lorded over the city and the state for decades. To me, that's the frustration. It’s easy to pick off the low-hanging fruit but we're not getting to the top of the corruption pyramid as it were. Faisal Khan: I completely agree with you. There's two trains of thought to that, right? There’s broken window theory of you take down every corruption, any corruption you can find so the guy taking that $500 envelope is a good start and you keep building, building, building and I don't have a problem with that also. But at the same time we do have to look at the bigger fish so to speak and realize where the problems start and what we can do about that. There's a disconnect between asking the right questions I think in this city and that is why does an alderman need an $8 million war chest? Why for someone who's holding a local position need those kind of resources to get reelected or…? Dan Proft: And why are people giving at that level. Faisal Khan: And why are people giving and who is giving at that level? Are we talking about you and me as residents of the city of Chicago? Are we talking about corporations? Are we talking about businesses who are trying to do business here in the city of Chicago and are recipients of contracts that come out of the city? Remember aldermen control every dollar that comes in and out of the city of Chicago. Every single dollar they sign off on, whether it's settlements in police cases, whether its contracts being given out, whether it's your taxes that we've talked about, whether it's penalties and fines, all of that money is controlled by them. So that's a great deal of power that they wheeled and so they simply has not been enough spotlight on these individuals not just in Chicago, Dan, but also at the state level. Also thinking about all the money that goes that way also. Dan Proft: Well, just doing comparative political systems, and this has been mentioned before that New York despite having three times the population of Chicago has fewer aldermen and the New York aldermanic or mayor aldermanic, mayor, city council system operates differently than Chicago. Is that part and parcel of the difference at least somewhat different political cultures? Faisal Khan: Incredibly so. I've often said that and I speak of Chicago this way that knowing what we know, Chicago is the third-biggest metropolis in this country behind New York and LA yet it’s run like the Wild West. I never would have envisioned what I've learned in the last four years. I never would’ve predicted this. I couldn't have. Dan Proft: It’s like a kleptocracy, like a South American kleptocracy. Faisal Khan: It’s something out of a novel. It’s something out of a movie that I thought I would see that this is what goes on here in Chicago. This is how our elected officials act with impunity and go about mining their own pockets or doing business that benefits themselves rather than their constituents. Dan Proft: That’s a pretty strong statement coming from somebody from New Jersey and New York. I mean it's not like you were out there in Mayberry. You didn’t come here, you know, kind of with the scales over your eyes. Faisal Khan: I was not wearing any rose-tinted glasses when I got to Chicago. In fact, leaving New York I saw the problems in New York and I thought that's going to be as bad as it gets and I was very much mistaken. Dan Proft: Were you recruited by Emanuel to come here or how did you make your way here? Faisal Khan: I actually came to Chicago before the Legislative Inspector General job was officially posted. It was actually held in abeyance for years, council delayed, delayed, delayed until they finally got forced to hire someone. So when I came here, I came here under different reasons to be a lawyer and do something different and with my employment history, I thought I fit well into this position and that's how I became the Inspector General. Dan Proft: Going back to the system, so in New York I'm sensing and I don't know the particulars certainly like you do, they don't have the feudal system that we have in Chicago and that turns out to make a big difference. Faisal Khan: I think it's the ultimate difference. I think it's not just the big difference. I think like you noted it's a population three times, more than three times the size I think at this point now and we're talking about half the size of the body of aldermen. In New York the councilmen they do what their job description describes and that's legislate. They come, get together as a body, they come up with ideas, they come up with ways to improve the city, they're not looking out for their one particular neighborhood where they live, they’re looking out for everyone in New York. I'm not implying that the system is perfect. There are plenty of bad apples that have come through New York unfortunately too which we all know about but certainly there's enough oversight and scrutiny of that body to make sure that that is marginalized and minimized as much as possible. Now look at Chicago. We’ve got 50 fiefdoms here. We’ve got 50 little cities within one major city. If I need a car sticker, I'm going to my alderman. If I need a garbage can, I'm going to my alderman. If I need to put a business sign up, I'm going to my alderman. If I need an extension on my house, I'm going to my alderman. Dan Proft: And the now if I want to rent my house out on Airbnb or some other share economy site then I have to go to my alderman. Faisal Khan: Everything is slowly being controlled by your alderman and what I saw as Legislative Inspector General a number of complaints that came in was about that. About this objective process of an individual like me as a citizen going to my alderman and either being asked when the last time I contributed to you was or whether there was just a personality conflict. Now here I am wanting to improve my business, wanting to improve my personal life, my home, my job and I've got someone who simply just doesn't like me and that's the easiest case, right? That's the word and now I can get what I need and so I can’t go to the city who I do pay my centralized taxes to who are supposed to handle buildings and permits and everything else that we just talked about but won't process my application because your alderman hasn't signed off on it which is not required by law. Dan Proft: It’s cultural and then it goes back to what you were saying where you said before about the continuum. Arrogance, contempt, corruption. Faisal Khan: Exactly and so when I walk in and an alderman suggests or his chief of staff asks me when the last time I contributed was, I should have my checkbook on me because that's ultimately what happens a number of different times and I again I'm not painting all aldermen with the same brush. There are many, many good people in this city who want to do good for their constituents but as you noted and I can tell you 31 over 30 years have gone to jail. Clearly there's a pattern and it's the pattern of arrogance, contempt, corruption and until somebody stands up and says enough is enough, something has to change, nothing will change. There is a culture of apathy that I want to change in Chicago. There's a culture where I want people to get outraged again and say enough is enough. They have to understand that corruption on the south side effects them on the north side. That somebody lining his pockets over there means your taxes are going up here. A bad contract given out to somebody on the west side means again money coming out of your pocket. Anything that goes wrong in the city, Dan, affects each and every citizen even though they don't see the connection. So my job at Project 6 is going to be able to show that connection to these people. That’s how I want to do this because I'm under no illusion here. I will not make any change in Chicago because if it hasn't been done already in the last 60 or 70 years by people far stronger than me who am I to I have enough humility to understand what I can and cannot accomplish. Dan Proft: Well, as you kind of intimate, you can't do it without majority will so a couple million people need to decide that they want to have to change direction. Faisal Khan: And not just the majority. Well, yes, it's the constituents. It’s people like you. It’s people like the media saying nope. There is no gray area anymore. It’s black and white. There is a rule. Follow the rule or deal with the consequences of the rule. One of my biggest frustrations as Inspector General in Chicago was that even though we would cite an alderman for doing something wrong, the often time response would be well, was that really a big deal? Dan Proft: Right. I can see the point that it's a violation but it's not a big deal. Faisal Khan: Right. That inherently is part of the problem. When you rank violations as to no big deal to serious big deal, we've lost already. Dan Proft: Right. Probably a good indication we shouldn’t allow the aldermen to self-police. I suppose though you must’ve done such a great job of turning this thing around because your position at City Hall was eliminated. Right? You were no longer needed because everything’s square. Isn’t that how it went down? Faisal Khan: I’d like to think that. I'd like to think that but unfortunately I'm smart enough to know the reality of it. As Inspector General when I have to go to the very body that I oversee and tell them they're under investigation because they wrote the law that says if I start an investigation against an alderman, I have to tell him or her she's under investigation and then at the same time ask them for an increase in budget or an increase in resources. We are doomed from day one. Dan Proft: Can you get me more money so I can further my investigation of you? Right. Why would they not say yes? Faisal Khan: Of course. Dan Proft: Of course. Sure. No conflict there. Faisal Khan: We had the second-lowest budget. No, I can officially say we had the lowest budget of any full-time agency in Chicago. We had $350,000 to run an investigative agency. To put that in perspective they spent more money on weed whacking in the south side per year than they did on an oversight agency of a body where 31 members went to jail in over 30 years. Dan Proft: Was the problem that you didn't get what they were doing, that this was supposed to be window dressing, not a serious thing and you took it to be a serious thing and so you weren't getting what they were laying down? Faisal Khan: I think there was some naivety on my part but when I took the job, Dan, when I sat down with some of the alderman that interviewed me, I said if you're looking for someone to collect a paycheck and go sit in the corner and keep himself busy, I'm not your guy. You see my resume. You see what I've done for the last 15 years of my career be it a police investigator for misconduct, be it a prosecutor, be it an Inspector General in New York City arguably the biggest and craziest city in the world. I'm not here to collect a paycheck. I could be at a law firm. I could be doing something much easier to collect a paycheck. Dan Proft: And you came with the imprimatur of the Giuliani and Bloomberg administrations. Faisal Khan: Yeah, who were very aggressive in cleaning up New York. For better or worse we can argue about that sometime but both had a similar mandate in ending corruption and problems in New York City in many different ways and I don't speak in an arrogant way about this, Dan. I don't want to give that impression that I was something special coming into Chicago. Simply that I was not going to take a paycheck and not do my job which is as it was laid out to me. Dan Proft: What happened here because what we were told and what many, not myself, but many Chicagoans bought is Rahm Emanuel, when he came to town in 2011, he was Gary Cooper at high noon. He's rounding up a posse. It's going to be different than the daily decades and he's going to make the hard decisions. He's going to chart a different course. He’s going to change the political culture. Now five years in, we all recognize that none of that was true but what was it like to actually work in the administration and deal with the mayor in addition to the members of city council? Faisal Khan: I don't know the mayor personally so I don't know what kind of man he is. I can only tell you from a professional standpoint that his leadership has been incredibly disappointing when it comes to ethics reform here in Chicago. Simple as that. I reached out to him numerous times over my four-year tenure and got radio silence. Back I brought him problems that I knew I couldn't address with city council and I needed him to lead, I needed him to intervene in the process and fix the problems. To me and to many of my colleagues, these were clear-cut issues that I don't think anyone would have argued about. I don't think ethics oversight is a partisan issue. I don't think I've ever seen a Democrat or Republican or anyone else in office stand up and say I'm not for good government and I'm not for cleaning up a system. Dan Proft: No, they don't stand up. They whisper it in the back of the room. Faisal Khan: Maybe so. But the fact that I got radio silence of four years from this administration spoke volumes, spoke louder than anything else and illustrated to me that unfortunately the words that were spoken by the mayor about ethics reform was just empty rhetoric. Because every opportunity the mayor had to in fact strengthen ethics oversight here in Chicago, it went the other direction. It weakened every single time. The ethics ordinance if you look at it, if you look at the changes that have gone through in the last three or four years it has been considerably weakened, weakened¸ weakened and bended more to the aldermen's where it's literally, it is a free-for-all. Dan Proft: Is it fair to say that Rahm Emanuel was complicit in the alderman essentially trying to slow walk your agency out of existence because I mean I read accounts and this was kind of on your way out the door, where you were personally financing the operation of your office because nobody would get back to you about your budget for the forthcoming fiscal year? Faisal Khan: We knew for a fact that our budget would expire by June of 2015, oh, sorry, June ’14, every year we knew that we could only run our term - we were a staff of maybe six or seven people, Dan, for an agency that - they envisioned we would take three or four complaints a year. By my second year, we were over 120 complaints a year against aldermen. People were coming out the woodwork to tell us about the problems they were having the city council. So we knew that we simply could not sustain the pace that we needed to sustain in order to be successful. So we knew that we needed staffing desperately, we needed bodies and we knew that even with the bodies, we would run out of a budget by June. We did. We ran out of budget by June and I had been deferring my salary up to that point as slow as I could in order to keep the agency going and try to spread the money out a little bit. So by June we had run out of the money and I had my salary left to either - to what to do with it. Take it for myself and close the office or defer the money to my staff, continue paying them because they were making much less than I was and keep the office open because we felt it was incredibly important and I made the latter decision. The office had to stay open. Alderman wanted me to close that door. City council want me to close that door. The mayor wanted me to close that door because he has his own agenda and I simply would not give in to that. I simply would not allow an agency as important as ours that had never existed before, never existed, and I knew was never going to exist again. I knew that. I knew that there would never be a Legislative Inspector General's office again. There was just no in that because I think I'd done what I was supposed to and they hated that idea. It was a clear choice to me. You know, as much as I needed salary too and to keep paying bills and doing what I needed, I wanted to keep the office open. I needed to keep these investigations going and I needed to keep the heat on the aldermen to make sure that they were doing what they're supposed to be doing. Dan Proft: But ultimately the doors closed? Faisal Khan: Ultimately, the doors still closed. My term ran out in November 2015 and that was the end and even though the mayor kept promising over and over and over again that it would never happen, the power transfer immediately, there’d be someone else running that. Never, never happened. It happened three to six months later when finally some of my power transferred to the Inspector General's office still with a great deal of limitations so again they weakened the ordinance and essentially there is no oversight. Dan Proft: So those complaints that you were getting, you know 120 a year or more, that was the beginning. Some of the alderman had said, well, you were going on fishing expeditions. You know, they were unsubstantiated complaint or they were complaints that weren’t of a serious level and it made it appear that there was more to investigate than there really was. How do you respond to that? Faisal Khan: That is a perfect example of why the system was so rigged. Aldermen knew and they knew because they wrote the law this way that I can't speak publicly about any investigation ever. I can’t confirm or deny the existence of an investigation. I can’t tell you that aldermen so and so was taking money from rom this person. I can't tell you which one is under investigation. I can’t tell you what they're under investigation for. So any alderman can go out there, Dan, stand up and make these statements like the one you just recited to me and they know that I will not stand up and repudiate that or refute it in anyway because I can't by law. So they set the system up in such a way that they can sit up and badmouth the Inspector General as much as they want knowing that I will never respond because by law I cannot. Dan Proft: Yeah, but now what about, I mean in terms of the outcomes of any investigations over four years, were there…? Faisal Khan: Even then I can’t talk about them publicly because our investigations are confidential. They went from me to the Board of Ethics. The Board of Ethics is under the same boundaries that I am. They cannot talk publicly. They can't even if they substantiate an allegation against an alderman or an elected official, Dan, they cannot publicly publish that alderman’s name. You will never know who was investigated. You will never know… Dan Proft: Unless it’s referred for a prosecution or some other adjudicative. Faisal Khan: Unless it gets public that way. Yep. You will never know. And the mayor had many opportunities to do something about it, did nothing about it and council certainly did nothing about it since they're the ones who designed the system in the first place. So that is the beauty of this conversation is that they knew that I would never respond to any of their accusations so they stood up and made as many accusations as they wanted. And this is not sour grapes here that I'm talking to you about. This is my frustrations coming forward and that's why Project 6 exists now. because we're no longer under those boundaries. That campaign finance investigation we just completed, where over 37 out of 50 alderman took illegal campaign contributions in 2015. We named names. We named where they got the donations from, how much they got it for, what legislation that that money was tied to or what vendor it was tied to lobbyists it was tied to, we can name names now finally. And that's exactly what I did and if you've seen any of the backlash to the report, they love to insult me personally, they insult my organization but no one's actually talking about the substance of the report. No one's actually refuting any of the allegations. Dan Proft: Well, you know as a lawyer, when the facts aren’t with you, attack your opponent. Faisal Khan: That's the Chicago way. Dan Proft: Well, yes and some have perfected it better than others. Faisal Khan: I agree. Dan Proft: Now when your office closed, when the Legislature Inspector General's office closed in the city, you did something else that was interesting and noteworthy. You whistled in the FBI to take your files because apparently you believe there was criminal wrongdoing that the FBI should pick up the ball and run with. I'm putting words in your mouth but I think that's a fair interpretation and the question is is that something that you believe, number one, and number two, do you expect to see some of the work that you did, the legwork you did, come to fruition in federal criminal prosecutions of sitting office holders in the near term? Faisal Khan: The short answer is yes. The short answer is we worked with law enforcement including the FBI and a number of different organizations in advancement of our investigations, criminal and otherwise. And so once we knew that… Dan Proft: So when will Rahm Emanuel be arrested? Faisal Khan: Once we knew that the doors were going to close, once we knew there was no turning back, once we knew that we weren't getting response from the mayor's office or any member of council, we knew that the end was near, that the sword of Damocles is going to drop. We had to make a decision and that decision was we have to protect the integrity of our investigations because the first thing that would’ve happened once I stepped out of that office with my staff, there’d be 15 aldermen lining up to get in the door to look through our files and look through our computers to see what exactly we were working on and what we knew about who we knew and what and when. Dan Proft: It was important I mean as an officer of the court to preserve chain of custody. Faisal Khan: It's not just chain of custody. It’s to preserve the integrity of every investigation that we were undergoing and it was also my duty and mandate to the complainants. These people finally had the courage to come forward – understand, Dan, that it wasn't like you and I could, you know, we can pick up the phone and called 911 tomorrow and say I think there's an alderman taking a bribe in an alleyway and sure, there’s a chance to cops will come out or something will happen. I couldn’t do that as Legislative Inspector General. If you wanted to file a complaint against alderman, you had to come in. You had to swear to your complaint under penalty of perjury. You had to sign your name to a document, your full name and address and eventually I had to turn that information over to the aldermen and so I can't even explain to you the chilling effect that that had on people who wanted to come in to file a complaint against an alderman. It's not like filing a complaint against a state elected official. Someone you never see or ever deal with or even a police officer because a police also deals with thousands of people and he's not going to, chances are he’s not going to remember you. Aldermen, I don't have to give the person's name to an alderman. They will recognize the fact pattern. Oh, that’s Joe Johnson who came in looking for this. These people knew that they were going to get retaliated against. And Chicago's history speaks to that. You know I think there is a perfect a reasonable belief that you will be retaliated against should you take on the system. And so these people, the ones that did come forward, these 120 people a year, who had the courage still to come forward, it was my obligation to protect them in any way I could because once they knew we were shutting down, panic set in as to was going to happen. Dan Proft: Well, sure. I mean I got into a Twitter war with my alderman and I am not allowed to go to Boss Bar anymore where he drinks. Faisal Khan: The power of the alderman. Dan Proft: But seriously, in terms of that it’s so interesting to me thinking about this and the whole controversy over Chicago police and police brutality issues. So on the one hand the alderman say you have to sign this affidavit under penalty of perjury like you described and on the other hand the same aldermen are saying with respect to police officers, no, no, no. We should have anonymous complaints. That should be fine. That's part of the whole Lori Lightfoot reform proposal. So here again you have political elites putting themselves above the standard of review as it pertains to even law enforcement. Faisal Khan: The hypocrisy is mind-blowing. It's absolutely mind-blowing. I don't know how else to describe it and I don't know how there isn’t a greater outrage about this. That not only did the aldermen shut down my office, an oversight agency of themselves that they mandated that no anonymous complaint can come in against an alderman and they came up with a myriad of improper excuses, superficial excuses for that yet they encourage complaints against police officers to come from any source anywhere. And I'm not in impugning the integrity of those complaints. I'm simply saying… Dan Proft: The standard. Faisal Khan: …what's good for the goose should be good for the gander. And it's again the history of Chicago where the aldermen or other elected officials in Illinois simply place themselves above the law. Dan Proft: And also the history of Chicago the problem with that, right? So I mean this is the Chicago Tribune famously opining when former fifth ward Alderman Hyde from Hyde Park Larry Bloom got pinched and went to prison. You know in Chicago even the reformers are on the take. Right? And so nothing has materially changed because you don't have the accountability mechanisms in place and when they want to present kind of a facade of an accountability mechanism, if somebody takes that seriously, then that somebody's ushered out the door. Faisal Khan: Ethics has got weaker. Something has changed with the aldermen in charge and this mayor re doing nothing about it. Ethics oversight it's got weaker and weaker and weaker and it continues to go down that path and that's why we started Project 6. Because there is such a significant void in the city of trust between the citizens and its government. Dan Proft: So tell me about Project 6 because this is a reference to the secret six from the Capone era. So the genesis of the name and then you know kind of the continuation about the work that you started at city hall. Faisal Khan: So my term ended as Inspector General and I thought about what I wanted to do. I think Alderman Joe Moore offered to buy me a ticket out of town. Dan Proft: That’s generous of him. Faisal Khan: It was. Dan Proft: He’s a bit of a spendthrift so a nice offering. Faisal Khan: He is and he tends to take taxpayer money anyway so I thought… Dan Proft: Yeah, that’s right. Yeah, right. I would’ve actually been buying you a ticket out of town. Faisal Khan: So the choice is clear. It was either let's call it a day and the proverbial tail between your legs and leave or stick around and I'm honest with you, I had a bad taste in my mouth. This is not the way it's supposed to go and whether it's my own arrogance coming through or my own frustration, whatever you describe it as, I simply was not going to leave Chicago in a worse place than when I found it and that might be again incredibly naive and arrogant of me but I couldn't do it and the people that I talk to in that time between starting Project 6 and ending as Legislative Inspector General was that same message, that they didn't want that either. They wanted to see the improvements. There are complainants who filed complaints who are such ardent supporters of us and they did not want to see this end. They did not want oversight to be buried yet again in Chicago. Dan Proft: So you're kind of a last to the mast kind of guy. I mean I like it because look I've been here for 24 years in the political arena and you know, I should be playing golf in Arizona like my neurology doctor friends at this point in my life. You know, it's one of those things – I don't know if, have you ever seen the movie Office Space? Faisal Khan: Yeah. Dan Proft: Yeah, so Michael Bolton? And Michael says well if you hate your name so much, why don't you change it? And he said well, I didn't have any problem with my name until that assclown started selling millions of records. He should change his name. He's the one who sucks. Well, I feel the same way about these people here across the partisan divide by the way because of course you've got a lot of Republicans that are corrupt and just as bad as any of the Democrats in charge. But why should I leave? I love Chicago. They're the ones who suck. They should leave. Faisal Khan: Well, I’m also kind of like the guy got moved into the basement, right? Because they kept pushing me away, taking my stapler, I’m that guy. I got my desk moved into the basement. Dan Proft: What’s happening? What’s happening, Faisal? Faisal Khan: Yeah, and I did it the polite way for the longest time and I’m like, okay, I can work with you, okay, I can work with you until they finally turned the lights out on me which is exactly what happened. They cut off the paychecks and then he came back and burned the building down. And that's not what I'm doing. Dan Proft: No. Faisal Khan: But proverbially I wish I can because that is what Project 6 wants to do. Is to fix the system here in Chicago, that we start fresh and we rebuild this and we do it the right way. Dan Proft: So are you kind of essentially, is this going like a shadow Inspector General's office where you're soliciting complaints, anonymous tips and then you're investigating them? You don't have administrative subpoena power anymore like you did at the actual Legislative Inspector General's office but you still have people that are experienced and can track down these matters or what's the kind of angle of incidence to prepare information that you can level up? Faisal Khan: I think your analysis is somewhat correct. I wouldn't necessarily say we're a shadow of the OIG. There's a great deal of limitations that the OIG has that we don't have in terms of the same rules that I had problems with, they’re still in place over there and there are a great deal limitations that the Inspector General's office needs to go through. What I think is going on in Chicago, Dan, is that there's an inherent distrust of government by the citizens. Dan Proft: Yes, well founded. Faisal Khan: Well founded and under many circumstances. Even the OIG's office. I think you can see that in the media. You've seen it and commentary and so we see it in a protest on our streets. We see it on so many different levels and there's a void which is what I was talking about earlier and I want to fill that void. I want people to be able to come forward and know that they're going to be protected, that we're going to do our best to protect them, that we're not under the same obligations, that I'm not turning over my investigative files on aldermen because I have to. I'm not giving up their names because I'm a government entity and I have to. I’m no longer a government entity. We're here to fight for the citizens of Chicago and I don't mean to sound corny or clichéd but we're doing something that's never been done before and there's other organizations out there, Dan like BGA and Civic Fed. Dan Proft: Yeah, yeah. But not so investigative like what you’re talking about. Faisal Khan: They're more policy-driven I would say and we're more investigative-driven. We are corruption seekers and corruption busters. We are we are looking to identify the real problems here in Chicago and take immediate action. Dan Proft: So many of us walk and talk about these things in abstraction. What we’re talking about is look, I go to my alderman, I'm trying to open a restaurant in X ward and I say hey, I got to come see you because I need a liquor license for this Chinese restaurant I'm trying to open and the alderman says, no problem, that's X amount of dollars to get the license through Department of Revenue and it's $5,000 the campaign contribution to me. You want to hear from that guy that's getting shaken down. Faisal Khan: I want him to walk out, pick up the phone, call Project 6 at that moment. I'll have an investigator available to talk to him and then we will take it from there. I want that conversation immediately. They can contact us on Facebook at Facebook/secretsix. They can go to our website thesecretsix.com. They can Tweet at us. They can find us. We are everywhere. We plan to be everywhere. We want to handle those problems because enough is enough in this city. People are sick and tired. Part of the problem, Dan, is that Chicagoans don't know what real government is supposed to be like. They haven't seen... Dan Proft: Nobody's lived long enough to see it. Faisal Khan: That's not meant to be condescending or insulting. It is simply that they've accepted the system the way it is. Dan Proft: Did you ever read Gus Russo's book The Outfit? Faisal Khan: Yeah. Dan Proft: Yeah. I mean that goes all the way back to the incorporation of the city which was kind of a corrupt deal in and of itself. Faisal Khan: If a New Yorker walked into his alderman’s office and had that conversation that you just described, I think New Yorker would reach over and punch the guy in the face or something else will come out of it. To give you an example, in New York just happened maybe four or five months ago in the winter, the Fire Commissioner used his own firemen to dig his driveway clean for him. Both newspapers called for his immediate termination from his employment. We see far worse going on in the city, far worse and yet unfortunately there are not enough calls for the ending of the abusive practices that go on here because again it's like… Dan Proft: What about the proactive stuff because you've got all these various arms of government and you've got areas that have been replete with patronage you know everybody's idiot cousin gets a job at O'Hare or at the park district. What about actually looking at institutions that are notoriously, infamously corrupt and zeroing in on them? Faisal Khan: Fantastic. We’re looking at anything and everything. We are initiating our own investigations. We are taking tips from citizens. I want as many whistleblowers to come forward as humanly possible. I genuinely believe that people are in situations they don't want to be in, don't feel comfortable in and/or know of people who are getting jobs and promotions above them that they shouldn’t be getting just because like you said somebody's nephew needs an internship, somebody's niece needs a job and somebody knows the mayor or knows somebody who knows somebody and here we are. That you're reporting to someone far less qualified than you and only got the job because of their last name. That has to end and the only way it can end is if we continuously identify that practice. Dan Proft: There was much touted during, this was maybe a couple years ago now. But Michael Shakman, Shakman saying the Shakman Decree is no longer necessary at the city level because Rahm has substantial reformed hiring practices so politics no longer plays a role in hiring and firing. Faisal Khan: I respect the court and their determination. I would say that these problems tend to repeat themselves and this mayor even if we gave him the credit for that, this mayor is not going to be here forever to maintain that and I think there's enough evidence and if you talk to employees of the city who will be able to come and tell you that this problem is never going away and as Inspector General I saw it. I received complaints about it and so this notion that patronage has now ended in Chicago is simply just not a notion. It unfortunately isn't based in reality and so while I can understand it from the cost that it was inflicting upon the city because we have to talk about that, the amount of money that was being paid out for an independent monitor to come in to monitor all the hiring, that can be fixed if we have a strong administration that says we will continue some of the practices that the court imposed on us or the Inspector General reviewed and there's ways to do that but I think you and I agree we haven't seen any of that. We haven't seen what really needs to be done or the stuff that we have seen is simply window dressing just like my job was supposed to be window dressing. Chicago's great at window dressing and I think we've seen enough window dressing for this lifetime. Dan Proft: And a message to Chicago voters, not to put too fine a point on it, but the Chicago residents who are fatalistic or apathetic or afraid to some extent legitimately so and have just – you know, and this is what breeds the kleptocracy and extends it, is people thinking they're not in charge of their destiny and they don't think they can improve their conditions. What do you say to them? Faisal Khan: I only want to speak to the people who aren't so jaded anymore. There are people unfortunately that are so jaded in this city whether based on longevity or bad experiences that I will simply not get through to them and I respect that. I understand that. So my comments are only going to be directed to people who are still willing to listen and care enough to listen. And what I would say to them is I'm not here to blow smoke. As a New Yorker would say, you know, to blow smoke somewhere. I'm not here to sell you a bill of goods that I can't come through on. I'm going to tell you truth and I'm going to tell you the problems in this city. Project 6 is going to tell you about the problems in this city but I can't do a damn thing about it without you. Without you and your anger, your interest, even your money if you can donate, you know, to help us keep going. Project 6 needs to keep going but until you take us seriously and take these issues in this city seriously, this is all a waste of time. You have to start taking this stuff seriously because you have to understand that it affects you. Your property taxes just went up. A lot of money across the city. Dan Proft: Utility tax is coming next. Faisal Khan: Utility taxes. You’re paying a cloud tax now on your Netflix and everything else. There’s reasons for that and the reason s is your gross mismanagement of your money over the last 10, 15, 20, 30, 40, 50 years in the city of Chicago and it's not changing and that some of that is due to mismanagement, some of that is due to corruption, some of that is due to criminality. But understand that every decision that's been made in council and by this mayor and any mayor for that matter affects you somehow whether you see it or not. Until you take the time to be a part of that process and understand it, it's going to continue and so I want to work with you. I want to make this city better for you and the only way I can do it is if you want the same thing. And if you want the same thing, pick up the phone and call me. Call my office. Visit us. Work with us. Give us the information we need to do the things that need to be done in this city. And then I'll sit down with people like Dan Proft. I’ll sit down with other places and I will get this message out and we can finally change a culture that is so desperate in need, does so desperately need it. Chicago will be the place where you do want to live and you do want to stay. Dan Proft: He Is Faisal Khan. He’s the 21st century Eliot Ness. Hopefully you and your six can accomplish with the secret six accomplished against Al Capone. Faisal Khan, the President and CEO of Project 6, former Legislative Inspector General for the city of Chicago, former Inspector General for the City of New York under both mayors Giuliani and Bloomberg. Faisal Khan, thanks so much for joining us on Against the Current. Appreciate it. Faisal Khan: Thank you, sir.

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Chicago Airbnb Ordinance Makes It Clear: Residents Do Not Really Own Their Homes

Dan & Amy spoke with a Chicago real estate attorney about the specifics and the implications of the new City of Chicago ordinance, pushed by Rahm Emanuel, to highly regulate property owners who want to use Airbnb and other property rental "share economy" services.

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Dan Proft: Dan and Amy. So Amy, you're familiar with the share economy not just Uber and Lift but with respect to your home like Airbnb. Amy Jacobson: Yeah. Dan Proft: Have you ever used Airbnb? Amy Jacobson: Oh, yeah, I've used it several times. Dan Proft: All right. Well… Amy Jacobson: It’s great and I've been thinking about renting out my homestead, you know, to Airbnb because people on our block are doing it with their coach houses and apartments so… Dan Proft: That’s perfect because those people on your block doing it probably preclude you from doing it. Amy Jacobson: Why? Dan Proft: Okay, we’re going to get a little education on how city of Chicago politics works here from local attorney in Chicago, real-estate attorney. His name is Shorge Sato and he founded an organization, a nonprofit called Keep Chicago Livable, it’s KeepChicagoLivable.com. Kind of spontaneously created by property owners in Chicago who thought they owned their homes. How silly! Amy Jacobson: I own my home. Dan Proft: No, you don't. The government owns your home and they will let you operate your home so long as you do so at the prices they set and by the structures they said including as it pertains to participating in the share economy. That's the result of the ordinance authored by tiny dancer, passed by the 50 trained seals on the City Council, that regulates your private property as it pertains to Airbnb and other services. Shorge Sato, thank you for joining us. Appreciate it. Shorge Sato: Thank you, Dan and Amy. Good morning. Dan Proft: Good morning. So explain the 58 page, twenty-five thousand word ordinance on Airbnb that… Amy Jacobson: Who’s going to read that? Dan Proft: Nobody on the City Council, I guarantee you that. Explain the thrust of the ordinance they passed regulating people's property and what they can do with it. Shorge Sato: Yeah, I guess it basically tries to force all home sharing hosts or vacation rental licensees to register and license of the city and they have to decide which one they are. They’re renting a vacation rental or shared housing [inaudible 02:10] definitions are both the same and then if they do register, they are subject to very strict regulations which include a duty to comply with the Department of Health Regulations for commercial kitchens which means you can't have a dog and yogurt in your fridge at the same time. It also restricts your ability to rent if there are other people in your building that rent on other sites that you may or may not know. It subjects you too $3,000 to $5,000 a day of violation penalties. If you don't do your laundry, don't clean the towels, $3,000 penalty. If you don't wash and sanitize all your pots and pans after every guest, $3,000 penalty. This law is a gross invasion of your fundamental property rights. Amy Jacobson: Well, who comes in and checks… Shorge Sato: [inaudible 03:14] Amy Jacobson: Sorry for interrupting. Who comes in and makes sure that my… Shorge Sato: If you don’t register, then they’re going to hit you with a $3,000 fine for not being registered. Amy Jacobson: Okay, but who comes in to check to make sure my pots and pans are clean and that my towels are clean? Dan Proft: Ed Burke. Amy Jacobson: I mean have they decided yet who’s going to be the police, the Airbnb police? Shorge Sato: Yeah, the Department of Business and Consumer Affairs. If they hear a complaint about an unlicensed Airbnb or perhaps a licensed Airbnb that somebody in the neighborhood doesn’t like, the alderman doesn’t like, they will issue some sort of notice that demands an inspection and if they come in and if they see something amiss, that’s another violation on their ticket list. Dan Proft: We also have, you know, the kind of rent-seeking behavior afoot here. Hotel and motel pack, Illinois hotel and motel pack, has given about $30,000 in donations to number of aldermen over the last year. They supported this ordinance because they want to crowd out competition from private home owners and so the other thing this ordinance does is treat homeowners like hotels, subject them to the 17.4% hotel tax in the city but in addition to that, it treats them worse than hotels because there's an another 4% surcharge on top of the 17.4% hotel tax that short-term rentors would have to pay to the city, right/ Shorge Sato: Exactly. There's an additional 4% surcharge and there are additional requirements that are put on Airbnb hosts that hotels don't have to comply with. For example, in hotels if there's criminal activity happening in a hotel room, the hotels can only be liable if they know about it whereas Airbnb hosts if it just happens they’re strictly liable or if they suspect that it's happening, they are supposed to affirmably call the police. Amy Jacobson: Now, how many - I mentioned that there's two homes, an apartment and a home that I know of on our street that are renting out, that our Airbnb, is there a limit to how many people in a certain block can be Airbnb members? Shorge Sato: It's not limited by block as much as it’s limited by building although there is an ability that for the aldermen to create essentially a residential restricted zone to try to limit the number of, you know, Airbnbs, or HomeKeys, or HomeAway or FlipKey or VRBOs in a particular block, I guess, or in an area. Dan Proft: So and I just want to understand because you said something but it needs focus. The aldermen. So the aldermen are empowered to say, “Oh, well, the ordinance doesn't apply to you” so we are protecting the feudal system in Illinois where we pass an ordinance but everything runs through the aldermanic office to empower the local feudal lord to say, “Well, you can participate in Airbnb and you can’t. We’ll create a carve-out for you but we won’t create a carve-out for you.” Shorge Sato: Exactly. That's one of the, I think, the more, I don't know what the word is, grotesque things about this law is how it creates this Commissioners adjustment which has about, I’m looking at nine different factors that the commissioner may consider, which are extremely vague like the relevant geography, the legal nature and history of the applicant and then it also says that the Commissioner must solicit a recommendation from the alderman, the local alderman. One guy or girl. One man or woman. Not the entire city council. And within 60 days based on of these very vague factors and an aldermanic recommendation then the Commissioner will make a decision about whether to make an adjustment. I think that creates a huge risk of discriminatory enforcement if not a certainty of it. Friends of the alderman will be able to operate. People that are not friends with the alderman might not be so lucky. Dan Proft: So just in sum, your property’s not your own, you want to rent it out, you're treated like a hotel except more highly regulated, you pay taxes like a hotel except you pay higher taxes, you’re limited in who you can rent to or when you can rent and how many of you can rent and if you want special dispensation, you go genuflect before your local feudal lord. This is why it's the city that works. Shorge Sato: The one thing that gets me is why are we penalizing harmless hustle? I mean at the end of the day this is just people using their own property in order to make something out of nothing… Dan Proft: And in order to pay… Shorge Sato: … $34 million of economy directly to hosts and $209 million dollars to the tourist economy in Chicago in 2015. These are people that are doing that out of their own property, not hurting anybody and we're penalizing the fact that - it takes work. You have to change a lot of sheets, you have to buy things, you have to upgrade your place in order to have a good home because if you don't, the market on Airbnb will punish you severely. It's just like Yelp reviews. Dan Proft: But the market will never punish you more severely than city government and in addition to that in terms of being penalized for doing something constructive and entrepreneurial, you're penalized for trying to deal with ever escalating property taxes. So we're not going to let you come up with creative ways to deal with ever escalating tax burdens as well. I mean it's really – I’m so glad that you're spotlighting this. Shorge Sato, Chicago-based real estate attorney. The organization, if you want to get involved, learn more, helpful advocate on behalf of private property in Chicago, KeepChicagoLivable.com. Shorge, thanks so much for joining us. Appreciate it. Shorge Sato: Thanks a lot, Dan and Amy.

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The Status Quo Meets Pokémon Go!

Chicago Democrats always have the same solution: taxes. Tax the cloud. Tax the air. Dan Proft and Jacob Hubert, Senior Attorney with The Liberty Justice Center, discuss the strange and problematic language in Chicago’s AirBNB legislation and Chicago’s tax on cloud services, such as Netflix and Spotify. How Pokemon GO is advancing Western Civilization. In a supremely contentious election year, are people buying what politicians are selling? Dick Durbin hopes so… If AFSCME strikes, could the state fill their jobs? 

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Narrator: Illinois faces a big challenges. Today we're about to hear a truly honest analysis of the problems we face. Equally as important you'll also hear an in-depth discussion of some practical solutions. This is your radio source for stories, the insight and the answers you won't hear anywhere else, not on the media and not coming from Springfield. You're listening to Illinois Rising presented by the Illinois Policy Institute. Now here's your host, AM 560’s Dan Proft. Dan Proft: Thanks for joining us on this edition of Illinois Rising. Dan Proft here along Jacob Huebert, Senior Attorney at the Liberty Justice Center. Jacob, the city of Chicago has seen property taxes increase substantially, 20%, 30%, 40% with more in the offing because of course of the unfunded pension liabilities and the bankrupt school system and so on and so forth and so you have people wanting to take advantage of the sharing economy by participating in services like Airbnb where they can rent out their home and make a little bit of money and try and defray the costs of having to pay for their homes in Chicago now a third time because of their property tax burden and of course that looks like money to politicians. They want their piece of it and so the City Council in their infinite wisdom passed an ordinance imposing additional taxes on homeowners who participate an Airbnb. a 4% surcharge on short-term rentals on top of Chicago’s 17.4% hotel tax and other associated fees to dampen the enthusiasm for those who would like to participate in that sharing economy. Jacob Huebert: Yeah, and not just taxes but also regulations, things they have to comply with, rules on whether they can or can't rent out that room in their homes. It’s a huge ordinance that this city has passed on this and not only does it cost you money in taxes, it costs you money and compliance making it a questionable whether this is going to be worthwhile for a lot of people now. Dan Proft: The ordinance is 58 pages, more than 25,000 words as you said but of course the City Council had to pass that ordinance to find out what was in it. For more on the ordinance from somebody who actually read it, which distinguishes him from the City Council, we're now joined by Shorge Sato who is a Chicago-based attorney and has been looking at this matter with particular interest. Shorge, thanks so much for joining us. Appreciate it. Shorge Sato: Thank you for having me, Dan. Dan Proft: And so, you know, give us your interpretation of the ordinance and how it regulates what people do with their private property and their kind of ability to make it make sense to participate in the share economy through Airbnb and services like it. Shorge Sato: Right. Well, we believe I that, and I’m saying we in terms of Keep Chicago Livable which is a non-profit we formed very recently in response to this Airbnb ordinance, we believe that there’s a fundamental right that all property owners, all Chicagoans, all Americans have a fundamental property right to have guests inside their own home. Dan Proft: That's a revolutionary statement. That is an incredible statement. You are allowed to have guests in your home. Wow! All right. Shorge Sato: And the city of Chicago is trying to regulate this and in fact this is, you know, not just a right. It’s an ancient and sacred tradition. It’s hospitality. It’s the definition of it of being able to have a guest inside your own home and what the city of Chicago has done is that it’s noticed this phenomenon of shared hosting sites like Airbnb, VRBO where people are making money on it because they're able to set terms up front about what kind of, you know, compensation for hospitality they would like and then out painting it all with the same brush as people who are running hotels. And I think they're Airbnb, you know, they do blur the lines a little bit but to say that everybody where the guests in their own home and invited guests that they’ve vetted and just because they have some terms that they agreed to upfront and because they met them on internet automatically is some business owner running a hotel is, I think, a bridge too far and infringes on some very fundamental rights of our ability to pursue happiness as well as our freedom of association and speech. Jacob Huebert: Now there's some people on the other side of this issue. The people who own hotels and motels of course don't like Airbnb and people renting out their rooms because they’d rather make them pay a high rates to stay in their hotels and the city likes it when people do that because they charge, of course, our city has a very high hotel tax and so there's interests aligned against this and opposing those kind of special interests is often difficult because, you know, there's a few big hotel companies and there's just a lot of, you know, people who want to rent out rooms in their homes. It's hard for them to get together and organized but now your organization is going to be a voice for those people it seems like. How did you decide that you were going to go about it that way and how are you going to proceed with this group? Shorge Sato: Well, this group was actually fairly organic. When the city of Chicago, when Mayor Rahm Emanuel announced that they were going to regulate Airbnb, I think a number of hosts were interested, concerned. I don't think the hosts object to the notion of some regulation but we all wanted to see the detail and there seemed to be, they seem to be very short on the detail and there were some protests and that's sort of where, which is sort of a remarkable thing in the middle of a day to have 200 people, you know, outside of the city hall council room taking their lunch break and then going back to their offices, it’s a remarkable sight. So I met some people through that, I went to those and then when they actually came out with the law, I read it and I was flabbergasted. This is this is a 58 page over 25,000 word ordinance that is a very difficult to understand. It’s actually very poorly organized regardless of the subject. You read this and it's not organized in a way that I think a person of ordinary intelligence could understand and even as an attorney, I was simply thinking, “Well, how can I help other hosts comply with this law?” and as I read through it, I realized that it was almost impossible for me to understand it. I've been an attorney since 2002, real estate attorney. I think of myself as fairly sophisticated in legal matters and yet I couldn't make heads or tails of this law. Dan Proft: And by comparison the Chicago ordinance governing hotels is two pages and 1,000 words. Shorge Sato: Exactly. Yeah, and that's sort of the rhetoric was oh, for the hotel industry is that we want to level the playing field. This is not a level playing field. I mean Airbnb hosts are charging or paying the same amount of the hotel operator tax as the hotels and there's an additional 4% surcharge that the city of Chicago decided to impose which, you know, arguably violates the home rule provision, the authority of the home rule authority as well, you know, authority provision in the Illinois constitution. Dan Proft: Yeah, right. Shorge Sato: …problem about how they did this. They just, they did an income earnings or occupation tax which the city of Chicago can't do without the enabling legislation from the Illinois general public. I haven't seen a state law that says they can do this. So operator tax is 5%. Dan Proft: Yeah, and I mean of course the ordinance is meant to be unintelligible. I mean that's the whole point. The law is unknowable so you no longer have the rule of law. That’s the story of the city of Chicago but I wonder this too. Part of the ordinance as I understand it is essentially the city kind of de facto herding homeowners into neighborhood co-ops like I think of, you know, Soviet-style agrarian cops where you have to effectively share the number of days that you can rent out your home because there's limitations by block? Shorge Sato: There are limitations based on the type of property owned and whether it’s your primary residence so an example is you could do everything you want to try to comply with this law but if you live in a particular kind of building, a two to four dwelling in a building or over five dwelling in a high-rise, you could do everything you can to comply with this law but because of something that your neighbor does, and it doesn't have to be on the same site, it can be on HomeAway, FlipKey, VRBO, maybe you’re on Airbnb and there are max cap limits on the number of units and so there are six units registered and if a seventh person jumps on apparently all seven are illegal at that point and all seven are subject to a $3,000 fine if not more. That's extremely troubling to me. That’s like if you parked on the street legally and because somebody else parks somewhere else, all of a sudden both of you are getting $3,000 parking tickets. That seems crazy to me. And the city had admitted it. They have no idea how this should be enforced. Here's the other thing that really should blow your hair back. So they have this very long, very confusing law but there's a big loophole in it and one of the biggest loop holes is that the Commissioner can make an adjustment if there are certain dwelling caps for instance. The Commissioner to make an adjustment based on number of very big factors that they may consider like the relevant geography, whatever that means, and the law says that the Commissioner must solicit a recommendation from a local alderman. Dan Proft: Yeah, right. So this is protecting the feudal system and protecting their carve-out discretion, right? I mean this is just like every other rent-seeking, inside-dealing ordinance in the city of Chicago and with the 50 feudal lords and the tiny dancer on top. Shorge Sato: I've never seen a law that sounded like this. It’s almost they’re admitting that this law is half-baked and they don't understand it and so it's a check back with me but it's not check back with the whole City Council, it’s check back with one alderman. You know, what's the separation of powers here? I mean the legislators passed the law, the executive branch enforces the law. You don't check back with one legislator say is the law being applied correctly? That’s a huge problem in terms of discriminatory enforcement, rent-seeking, pay-to-play, friends of the alderman get to do it but people don't. Dan Proft: Oh, Shorge, you and your antiquated notions of separation of powers and representative democracy. Come now, come now. Shorge Sato, he's a Chicago-based attorney. The organization Keep Chicago Livable, KeepChicagolivable.com. Shorge, thanks so much for joining us and educating us about this ordinance. Appreciate it. Shorge Sato: Thank you, Dan. Narrator: We now return to Illinois Rising, presented by the Illinois Policy Institute. The radio show discussing the honest truth about Illinois policy and politics. Here's AM 560’s Dan Proft. Dan Proft: Dan Proft. Thanks for joining us on another edition of Illinois Rising. You can hear me Monday to Friday on AM 560, 5:00 to 9:00 each morning with Amy Jacobson on Chicago's morning answer and pleased to be joined today with Jacob, excuse me, by Jacob Huebert who is a staff attorney for the Liberty Justice Center in Chicago, public interest law firm that represents free-loving, freedom-loving people against the excesses of government. Jacob, thanks for joining us. Appreciate it. Jacob Huebert: Sure, always happy to be here. Dan Proft: Do you know about this Pokémon Go that the kids are raving about? Jacob Huebert: Well, I looked at it for a few minutes then deleted it so that the Pokémon people can't spy on me so I have a little sense of it but I haven't used it too much. Dan Proft: So you deleted it because you were afraid of them mining you for information making, you talk, following you around? Jacob Huebert: Well, that's one reason and then another reason is of course so I’m not tempted to waste time on it because it seems to be kind of addicting. It seems like it would be fun but I just got rid of it quickly. Dan Proft: Yeah, I mean, you can't your hourly rate for playing Pokémon Go I suppose. That would be problematic. So I know of this. I get the concept but I don’t understand like back in my day, you know, I sound like an old man because I am, back in my day, you get together, you play a game of Dungeons and Dragons. You know? Even you go to Comic-Con, you go to Dragon-Con, you get together with other dorks who live in their parents’ basements and have limited social skills and you do the role playing game, the dice game, the Magic, the Gathering, you throw some pogs around. Well, what's with the virtual stuff is a baffling to me. It frightens me as an older gentleman. Jacob Huebert: Well, I don't think it's frightening and I know our guest coming up has some thoughts on why it's actually beneficial and why shouldn’t frighten us but encourage us and so I'm looking forward to talking about that with him. Dan Proft: Well, Jeffrey Tucker, that is the aforementioned guest, he is the Director of Content for the Foundation for Economic Education, FEE and Liberty.me. You remember FEE, Leonard Read, right? I penciled the seminal essay on free market capitalism but Jeffrey Tucker, Director of Content for FEE and founder of Liberty.me. He wrote this piece that has a very counterintuitive title – “How Pokémon Go Brightened a Dark World”. I'm baffled by that contention so Jeffrey Tucker, thanks for joining us to explain it. We appreciate it. Jeffrey Tucker: It’s a pleasure to be here. Thank you. Dan Proft: And so how is Pokémon Go advancing the cause of Western civilization? Jeffrey Tucker: I’m sure a lot of your listeners right have used it and they know. They understand. You know, it was a wonderful thing. It came out, I guess, just a couple of weeks ago at a very strange time of American political rhetoric, you know, and events so we are hearing nothing in the news that is about racial division, the darkness, the sadness, the decline in the American family living, you know, the politicians were, you know, strutting about, you know, trying to make us feel disgruntled, unhappy, you know, sort of despairing of the future. And then just out of nowhere without any warning this game in a sort of lovely way was released and it went viral. I mean it became the most popular game ever and I couldn't really understand it entirely and so, of course, I had to download it just like everybody else and then I started playing it and it was a revelation because first of all, it gives you an inside into a new world of technology that we've never experienced before, kind of a blending of the physical and digital worlds. It’s almost at the point you can't really tell the transfer and so, you know, it gives you a glimpse into future and the possibility that markets can help us achieve this. And Pokémon Go did something else, It provided a very interesting opportunity for people to meet their neighbors in a way they never had before. And I had read about this and so I tried it myself and immediately started either catching Pokémon in my room and then I went out into the hallway, went out into the garden and sure enough started bumping into other people that were doing the same thing. We laughed together. We talked together. Dan Proft: Well, see… Jeffrey Tucker: We met each other. It was beautiful. Dan Proft: But see on that point, I thought that was a bug, not a feature because as I understand it technology and the advancement of is to help better isolate us from human contact so we don't have to run into other human beings so this seems to be running counter to that. Jeffrey Tucker: Yeah, well, that’s a line we’ve heard for 20 years. You know, I’ve kind of grown up with the digital revolution and I get weary of people putting it down and thinking they can characterize it as the following thing. I mean essentially digital technology seeks to serve our needs whatever they are and do an ever more perfect job of it. And one of the needs that people have nowadays is a new social opportunities which were sort of lacking and I think it's just a beautiful thing that a game came along to provide those kind of opportunities for us. I went out to the public park, you know, with my new app and sure enough there were lots of people out there doing exactly what I was doing and it was a beautiful thing. I made some new friends and we laughed and talked to each other and we smiled together and found the humanity, you know, in each other. And I just have to believe that sort of integration, that sort of a social accessibility is important for our lives. I do believe it and I just think it's a lovely thing that technology is helping to achieve. Jacob Huebert: Yeah, you contrasted the sort of like dark political rhetoric and things going on in politics with the relative brightness of Pokémon Go but would you say Pokémon Go is a distraction from those things or does it actually have the potential to counteract the bad things going on in the world of politics and government. Jeffrey Tucker: Well, the strange thing is I think Pokémon Go gives us a better picture of reality. The truth about the world is that so long as markets are operating and we have freedom, freedom of association, freedom of to choose, people tend to get along actually. We find value in each other. This is one of the magic of the marketplace. That it sort of illicit from us a desire to find the dignity and recognize the dignity in others and then in us. You know, we developed sort of exchange relationships whether that's friendship or romance or pure commercial exchange, whatever it is, in the real world, people figure out ways to get along with each other. And the contrast with politics is interesting. It’s like, you know, more and more American politics is sort of devolving into these sort of warring tribes. I mean we see it out on the streets, you know, with the protest for and against. And it's a source of division among us, I mean that's really what it sort of seems to be coming down to, you know. You have to choose your team and try to beat the other team. Jacob Huebert: Yeah, you know, I thought about that recently. I was in a store and I thought if you just looked at our interactions with each other in stores, you would have not the slightest inkling that there's any racial or ethnic divisions in America at all. You would think that everybody loves everybody. Jeffrey Tucker: Yeah, I'm glad you said that. That is so true and I'm struck by this all the time too. Go to them, if you think America’s divided and, you know, we’re involved in a race war and a class war and all this other nonsense, go to the local mall, you know, check it out, see what's going on in your downtown on a Saturday night. You know the truth is in the commercial marketplace, we all do come together with genuine, you know, affection for each other and discovery of each other's humanity. Commerce is what gives rise to all this stuff and you don't see a division. You see, I don’t want to call it unity, but you see a beautiful sort of cooperation, you know, taking place. It's only when politics intervenes that we start to hate each other's guts and regard each other as a threat rather than, you know, a valuable person. Dan Proft: All right. We’re talking to Jeffrey Tucker, Director of Content for the Foundation for Economic Education and I want to ask a decorum question though because I understand the spontaneous order argument and it's a good one but also is there something about Pokémon Go that's also illustrating some of the boundaries that have been lost, a crassness of our culture and I just cite the need for the Holocaust Museum in Arlington National Cemetery to ban Pokémon Go probably in response to some people playing Pokémon Go at those institutions. Jeffrey Tucker: You know, I kind of regret that the Holocaust Museum did that because I tell what. I don’t know if you've ever been there to the Holocaust Museum but it’s a little bit of a forbidding place. I mean it's the kind of place you walk by and thank, “I don’t want to learn about the Holocaust. That’s not a place I want to go.” So for Pokémon Go to have chosen that spot as a gymnasium is actually sort of humanizes the place and gets people a little bit interested in it. My own view of the Holocaust Museum is that if you haven’t visited, you’re really deprived of something extremely important. I think it’s the most libertarian oriented pro-human rights institution in the whole of Washington DC and I'd like to see more people go visited it and if Pokémon Go gets people to that front door, I think that's great. So I wish they hadn't discouraged that actually. Dan Proft: All right. He is Jeffrey Tucker, Director of Content for the Foundation for Economic Education and the founder of Liberty.me. Jeffrey, we're going to hold you over. We're want to come back and kind of pick up on this discussion of how we interact with one another in the real world versus how we do so when politics interjects itself into our real world and we'll do that right after this. Narrator: Now more of Illinois Rising, presented by the Illinois Policy Institute. The only show directly addressing the problems and solutions for Illinois. Now, from AM 560, here’s Dan Proft. Dan Proft: Dan Proft back with Jacob Huebert, Senior Attorney for the Liberty Justice Center on this edition of Illinois Rising and we're also joined again by Jeffrey Tucker who is the Content Director for the Foundation for Economic Education, FEE, and also the founder of Liberty.me and Jeffrey, I wanted to kind of pick up on our discussion. Another piece that you wrote for FEE, for the think tank that you work for about the new revanchism and how we get along, people of different characteristics get along in contrast to how perhaps we’re portrayed as getting along when it becomes the binary choices of Black Lives Matter versus law enforcement and others that are broadcast endlessly on cable news channels. Explain the new revanchism you reference. Jeffrey Tucker: Yeah, okay. Well, the background here is that for about the last 20 years or so all the amazing things we've seen happen to the world, the digital revolution, the decline in crime, the decline in poverty around the world, you know, just the vast improvements in the standard of living all over the world but the new possibilities of customizing our lives, you know, according to our smartphone apps. The invention of the app economy, beautiful things, navigation tools, health tools, every kind of tool you can imagine. Our lives are much better off. They’ve all come about from the market and not from the ideas of the political class. And you look at what the politicians have done over the last couple of decades, most of their big highfalutin plans have amounted to nothing. I’m a Common core is extremely unpopular. Obamacare has been a disaster, I mean, almost universally as far as I can tell. So, you know, there's a widespread impression that people having that these guys can't really do anything for us that we can't do for ourselves and that technology is a much better source of improving our lives than politics and the purpose of my new revanchism piece was to illustrate that you see within politics a kind of a revenge spirit developing, you know, where they're trying their best to matter in the world and to take back lost territory in every area from communications to transportation to education to security provision and mostly they've lost the sort of a battle for the hearts and minds of the public. You know we've lost confidence in politics and in government in general and all the polls demonstrate this. Now this term… Jacob Huebert: You do see people, I mean there are people who are flocking to both of the major party political candidates who do seem to buy into this and of course government and politicians are pretty good at propaganda, are pretty good at getting people worked up into a fervor even when there's no good reason for it. Do you think it's different now? Do you think what the market is offering us is just so much more amazing than anything we've ever experienced that it's going to offset that and it's going to, people aren’t going to fall for it again? Jeffrey Tucker: I do and I think there's a certain illusion. Right now we've got the conventions going on and everybody’s focused on Trump, Clinton, you know, blah, blah, blah. But the truth is that I can't find a single poll that contracts what seems to be an obvious fact that two-thirds of Americans are alarmed by their choices that they were given and are expressing, you know, very little if no confidence at all in either Democrats or Republicans at the center right now. And we've never seen anything like this actually. There’s not on record an election in which the disapproval rating for both these candidates have been so low. I mean usually in the past has been disapproval’s been high for one but approval’s been high for the other and there’s been sort of a seesaw effect. Not both are down and… Jacob Huebert: Well, despite people’s disgust, we're going to be stuck with one of these presidential candidates in office in January and then they're going to do things so is the disgust going to actually be able to rein these people in or is the fact that politics left in large part to some of the worst people going to, you know, they'll do bad things no matter what? Jeffrey Tucker: I think this is the way politics looks at the end of the age of statism as far as I’m concerned. I mean this is what you end up with, a politics of revenge and I’m sure you've thought about this and your listeners have too but no matter who gets elected in November you're going to have half the American public in a state of non-stop frenzied opposition to that and that’s extraordinary. Dan Proft: But one thing on this topic though, I mean remember what people are voting for, even people who didn't vote for either Donald Trump or Hillary Clinton, I mean the insurgency on the left was for somebody who's more of a status than Hillary Clinton as an avowed socialist. So to some extent, yes, they're very unpopular, you're right and maybe this will be of some kind of watershed moment regardless of who’s elected but the concern is you have a majority of the country, an overwhelming majority of the country, voting for paternalism on both sides of the aisle. Jeffrey Tucker: Well, you know the Sanders thing was a little bit confused. I don't really think his supporters were about socialism actually. Best I can figure out they liked him because he seemed, you know, honest, independent and condemning of a kind of a ruling class racket, you know, and sometimes I think people, you know, on the pundit side of things over think matters a little bit. The average person looks for sort of signaling devices, the travel associations, I really don't think it's - I mean, did Sanders supporters really long for a gigantic state to rule the world. I don’t really think so. I think they looked at him as a kind of humanitarian. You know, it’s a confused look but I don't think that longing for tyranny was actually the basis of his support. Dan Proft: Well, right but it's, you know, the creeping socialism. I mean and the failure to connect dots so when I say I want free college and I want this and I want that and I want it at somebody else's expense I mean that’s the road to serfdom you're on whether you recognize it or not. Jeffrey Tucker: That's true and the road to serfdom is always very complex thing and it comes in circuitous ways and it comes in various flavors. It can come in the Sanders flavor, it can come in the Trump flavor. I noticed that the only politician that Trump actually praised in his nomination speech was Sanders. Dan Proft: Right. Jeffrey Tucker: They have.... Dan Proft: That’s the concern, yes. Jeffrey Tucker: It is a concern but, you know, I don't believe that this world is capable of being ruled anymore. I really don't. I mean we've got three hundred million people. You know everybody lives a deeply customized life. We’re all in the habit of being basically dissidents in our lives. We've got ever more choice. There’s very little toleration left for intolerance essentially. Free speech is now something we take for granted. The state of the sort that we built in the 20th century is not a viable project in the 21st century and a digital age. Dan Proft: All right. He is Jeffrey Tucker, the Director of Content for the Foundation for Economic Education, great think tank, He’s also the founder of Liberty.me. Jeffrey Tucker, thanks so much for joining us. Appreciate it. Jeffrey Tucker: It’s my pleasure. Thank you. Narrator: Now more stories, insights and analysis of Illinois policy and politics. This is Illinois Rising presented by the Illinois Policy Institute. Once again your host AM 560’s Dan Proft. Dan Proft: Dan Proft back with Jacob Huebert, Senior Attorney at the Liberty Justice Center on this edition of Illinois Rising and already were going through the annual ritual like the swallows to Capistrano of Chris Kennedy, two years out from the governor's race contemplating running for governor. Leave the speculation about Lisa Madigan, daddy's little girl running for governor if daddy decides to leave which is unlikely and other potential candidates against Rauner as the battle lines become more sharply drawn between the public sector unions and the politicians they finance and Governor Rauner and his turnaround agenda, reform platform and this talk picked up in intensity because all of the criminal families were represented the Democrat delegation to the DNC in Philadelphia and so this was the talk and their candidate of choice right now which had been rumored about for a while but was more formalized at the convention, Dick Durbin, Senator Dick Durbin running for governor in 2018. That's who the Democrats seem to want against Rauner. Jacob Huebert: Yeah, that'd be hilarious if I didn't have to keep living in this state. Dan Proft: Yeah, right. Jacob Hubert: It's amazing that anyone thinks that that man is competent to do anything after the disaster of his amendment to the Dodd-Frank Act and everything else he’s done in office is just shocking especially given the situation in Illinois where we have these problems that everybody knows we need to fix and which we know that he would offer no solution to or none of these people would offer any solution to. Dan Proft: Yeah, but he does present a political challenge to Rauner. I mean this is somebody who's won now three statewide elections for Senate, ’96, 2002, 2008, oh, and 2014 and he's been likely challenged if we're being real honest, kind of a failure of the Republican Party to field better candidates against him over the last two decades now and the additional advantage he has is he would not have to give up his Senate seat to run and because he's, you know, in the sunset of his political lordship, if he got elected and the Democrats still controlled the General Assembly then he could do all the bad things the Democrats want done, the tax increases and the pension sweeteners and the extension of what we've been doing for the past 40 years under Madigan’s hegemony and, you know, then walk away. So, you know, it's one of those things where you look at Dick Durbin and you say, you know, “Seriously? We're going to continue doing this” but Illinois seems to sort of have a penchant with the exception of Rauner of continuing to do this. Jacob Huebert: Yeah, you're kind of making me sick here. Dan Proft: Yeah, well. Jacob Huebert: You know at the at the Liberty Justice Center, you know, we strongly believe that the state can be turned around, we can do things differently, things can move in the right direction but if the people of Illinois go for that, I don't know. It might be time to rethink things. If they think that Dick Durbin is the answer to any problem that this state faces, I just don't know where we go from there. Dan Proft: Would you feel better if it was Valerie Jarrett whose name has also been mentioned. She could run state government the way that she helped run the CTA back in the day. Jacob Huebert: No, it's all the same. They all offer the same thing which is which is more of the same which is heading us further down the path of more debt, more pension burden that we can't afford, more handouts to public sector unions at everybody else's expense and any of these people is just going to be a disaster. Dan Proft: Speaking of the public sector unions and the intersection of policy there, we’re coming up to a critical moment in Governor Rauner’s brief tenure and that is the AFSCME contract, the largest public sector union. There is a labor impasse. It’s being litigated right now. AFSCME is preparing its members for the possibility of a strike. This was a topic of conversation at the Democratic convention where the national president of AFSCME said we’ll essentially be there with resources if you guys decide to go out on strike. This comes against the backdrop of Rauner successfully negotiating 18 public sector union contracts with unions representing smaller groups of state workers, wage freezes, all of them. AFSCME wants a 29% wage increase over the life of a four-year contract and thus the impasse and I wonder how you potentially see this playing out once this clears the legal hurdles for the governor to decide whether he wants to lock them out or AFSCME decides they want to vote to go on strike? Jacob Huebert: Well, I can't imagine that it would be politically beneficial for AFSCME to go on strike given that these are already some of the country's highest paid state workers, given that their colleagues who are in other unions have already settled for better deals and given that everybody else has to pay for this and they don't get to retire at 55 and they don't get a millionaire pension and they don't get the same level of salaries that their public sector counterparts get. So I would think that the people of Illinois would just be ready to say goodbye to these people if they actually go on strike because who wants to pay for that? Who thinks that they should have to work until they're 75 to help somebody else retire at 55 with a higher salary than them? Dan Proft: And in Illinois which has an unemployment rate 25% higher than the national average, I wonder if there's other people out there looking for employment or enhanced employment who would be willing to take the wage fees, to take the deal that all of these other public-sector unions took, to have a job at the Department of Human Services or IDOT or other state agencies, maybe have less of an entitlement attitude that has been the culture of AFSCME and SEIU and the teachers unions. Jacob Huebert: I suspect there'll be a lot of people ready to step in and do those jobs and I also suspect that many of those people would do at least as good of a job as the people who are holding those jobs right now. Dan Proft: Well, we may have a market test coming up. Narrator: Restoring Illinois to greatness. This is Illinois Rising presented by the Illinois Policy Institute and hosted by AM 560’s Dan Proft. Dan Proft: Dan Proft back with Jacob Huebert. He is a Senior Attorney at the Liberty Justice Center and one of the cases you're working on right now, Jacob, is this a lawsuit against the city of Chicago as it pertains to their cloud tax, a taxing of streaming services like Netflix and Spotify. Where does that lawsuit stand? Jacob Huebert: Well, so last year the city of Chicago's Comptroller just issued a ruling saying that we're going to start taxing these services like Netflix and Spotify, online streaming entertainment services, we're going to tax them at 9%. It’s the same tax we’ve already applied to the movie theaters and other amusements in the city, carnivals, whatever. We’re just going to say that that tax now applies to Netflix and Spotify as well. And without passing a new ordinance, the original ordinance doesn't say anything about these services. It talks about things like movies and carnivals, stuff like that, doesn't say anything about these services but the Comptroller declared were just taxing these things now. And so we brought a lawsuit challenging this for a few reasons. One reason is because, of course, if you want to tax something new, you should pass a law to tax that thing instead of just declaring that you're going to tax that thing and another problem is city of Chicago taxes you for your Netflix or Spotify or whatever if you have a billing address in the city of Chicago but it doesn't matter whether you actually ever use these services in Chicago. If you go to college or otherwise live outside the city and never use these services in Chicago, they still claim the right to tax you for them and that's not right either. The city of Chicago, if it passes a law, only has the right to tax things in Chicago and not reach outside. And there's other legal problems with this too and so we filed that lawsuit late last year and just this month the court here in Chicago ruled that this case survives a motion to dismiss. The city moved to dismiss it, said there was no merit to our claims. The court said well actually if you prove the facts that you've alleged here then you have shown that this law is unconstitutional and so that's really encouraging news and of course these things take a long, long time to play out so we won't get a final ruling for many months yet but it's encouraging and of course the court should strike these things down because the city can't just declare something a taxable and the city can't reach outside of its borders to tax people who aren't in the city. Dan Proft: And it’s interesting. I wonder if this lawsuit if it precedes, and it doesn't look good for the city, if it will prompt them to then try and move an ordinance through and give Chicago residents essentially the opportunity to put pressure on their aldermen to, you know, engage on the topic to try and defeat a formal ordinance. Jacob Huebert: Yeah, well, they slipped something into an ordinance the kind of makes passing reference to taxing these things and so they've tried to do that and the judge actually said that that overcomes the you-didn't-have-a-law problem which does not make sense to us and we’ll be appealing that part of it but the other aspects they can't fix, they can't fix the problem of reaching outside of their borders, they can't fix the problem of this actually treats online entertainment worse than in-person entertainment which violates federal law so they can’t overcome that in any event. And as for passing a new ordinance that specifically addresses these things or maybe corrects some of these problems, of course, they don't want to do that because if they do absolutely everybody would oppose that tax. Consumers would oppose the tax, the media streaming companies like Netflix Spotify obviously would do it and presumably the movie studios and big music companies would do it too because if Netflix and Spotify become too expensive for people, what are they going to do? They’re going to go pirate those things and nobody will make any money off of it. So absolutely everybody except our political leaders would oppose this thing if it were actually put up for a vote. Dan Proft: And are you getting support, your legal team getting support from some of the streaming operators like a Netflix? Jacob Huebert: Well, no, they haven't communicated with us directly or anything but there's every reason to think that they do support it. Of course, this tax Chicago imposed on them is the first of its kind in the nation so I'm sure it's important to them to see this crushed here so it doesn't spread elsewhere. Dan Proft: But it's actually even more interesting. It’s not, the Liberty Justice Center and your legal team, not representing the big companies like a Netflix, representing ordinary Chicago residents who are being treated unfairly under this non-ordinance. Jacob Huebert: That's right. Our plaintiffs are people who live in Chicago, who’ve been forced to pay this tax who don't want to have to pay it. That’s who we’re representing here and if we succeed though, of course, it won't just benefit them. It'll benefit everybody in Chicago because this thing will be struck down. Dan Proft: All right, and we'll be keeping a close eye on the progress of that lawsuit in coming episodes of Illinois Rising.

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Ditka: If Trump Calls Me, I'll Be In Cleveland

Hall of Fame Bears Coach Mike Ditka joined Dan & Amy to talk politics and the passing of Buddy Ryan. Ditka, an early Trump supporter, said despite media reports he has not been contacted about appearing at the Republican National Convention in Cleveland next month but, though he does not travel much anymore, he'll be there if Trump calls and asks him to be.

View full transcript


Dan Proft: Good morning, Dan and Amy, and Amy, as you know, I’ve been struggling with my golf game a little bit this summer. Amy Jacobson: A little bit? I think you did break your driver by slamming a wedge into your bag and then it cracked, correct? Not that I remember perfectly, but I think I have the details correct. Dan Proft: That is not inaccurate. Amy Jacobson: Okay. You’ll slow your role, man, back and through. Dan Proft: Trying to find my spiritual center on the golf course, but it’s been difficult, so I figured let’s have somebody on that could give me a few golf tips, particularly with respect to anger management on the course. And that’s, of course, Hall of Fame coach and player Mike Ditka, who joins us now; coach, thanks for joining us, appreciate it. Mike Ditka: You’re welcome, guys, how are you? Dan Proft: Good. So you weigh into politics from time to time, and the story yesterday that the Trump campaign trying to line up certain sports legends for the convention next month, including Mike Tyson, including Bobby Knight, and including Mike Ditka. Are you going to the convention? Mike Ditka: I don’t know. This is the first I’ve heard about it. I’m being very honest with you. I have no clue. Somebody asked me yesterday and I have no clue. Now if you’re asking me, this is America the last time I looked. Maybe some people think that’s changed, but this is a country where you have a choice. You have a freedom to vote, and that vote is your choice. You don’t have to make it public, you don’t have to make it known, but you vote for somebody that you think is good for America. That’s all that’s important. Now, anybody who votes for anybody, that’s their prerogative, God bless them. I have no problem with anything, but I don’t want anyone telling me that it’s wrong to vote for somebody for whatever their reasons are. I think that’s asinine, stupid and childish. Amy Jacobson: So coach Ditka, you came on about a year and a half ago praising Donald Trump saying that he’s right on track. Do you still feel that way? Mike Ditka: I do. I think he says what a lot of people would like to say but don’t have the guts to say. I think he has a lot of qualities of leadership that people in our government don’t have right now. That’s what I believe. Now, that’s my belief. Does that make me infallible? No, it just makes me believe it. And you’re asking me the questions who evidently you want to know what I believe. Well, I’m telling you, that’s what I believe. I believe he will be good for America, I really do. Now you may not feel that way, that’s your prerogative. Amy Jacobson: Right, I’m trying to warm up to Donald Trump. Mike Ditka: Are you trying to warm up to him? I warmed up to him. Who do you have to warm up to? I mean, look at this whole thing. Who do you really have to warm up to? Come on. You can spin the wheel anyway you want to, you can come up with this and that, but you have two choices right now, and one of them is really not good, so it’s up to the individual. So again, America’s going to survive basically anything. I think it will. I’m not positive. In my lifetime I think it will survive it. Other than that, I don’t know. It’s up to the individual. You do what you want to do. Dan Proft: Coach, do you want to go to the convention? I think it will be a hoot to see you and Bobby Knight on the dais there, making a case for Trump. Mike Ditka: What is a hoot? Dan Proft: It’d be fun. Mike Ditka: I mean, what is a hoot? Is a hoot for whom? Dan Proft: For republicans. Mike Ditka: Listen, I’m not adverse to anything. This is not my life. I’m an old man. There’re got to be other people that can do a better job at this than I can. I’m very honest, but I respect my views, because they’re personal. I think I’ve been on this Earth for quite a while now, three quarters of a century, and I have a pretty good understanding of what I like about America and what I worry about when it comes to America. And there’re some worries right now that people are always going to brush it aside. Go ahead, you brush it aside. I’ll worry about it. Amy Jacobson: But what concerns you most right now? Mike Ditka: The country and the direction we’re going. Who are we? Are we proud to be Americans or we should apologize for the rest of the world. I don’t know, you tell me. Our leadership is apologizing, and for what? What are we apologizing for? You know, Americans got where we are in this country by doing one thing; it’s called hard work. That’s what my dad did, that’s what my grandfathers did. They came over from the old country with the opportunity to an immigration system that’s been in existence for over 100 years; how to get to this country, how to become an American citizen, and how to be a good citizen, and that’s what they became, and they worked their butt off, and they loved it. Because every day they had to go to that mill; they had to work at that steel mill, work at that railroad, and that’s okay. But where is that in American today? We have an entitlement, we have an entitlement society. Everybody says, well, you’re entitled to that because of this. That’s not right. You’re entitled to what you earn. You’re entitled to the opportunity to be an American citizen, to work, to love, to cherish, to raise a family. That’s what you’re entitled to. You want to do that, good. If you don’t, you ought to go to one of those other countries and see what they’re really like. Dan Proft: And it’s interesting, because I think there is a sort of a silent – increasingly less silently – majority who believes that about America, and it’s not just the lunch-pail guys that’s up and down the socio-economic scale, it’s all races. There’re a lot of people who believe that and it seems like Trump has struck a chord with people who do still believe that. Mike Ditka: Well, it depends. If you think America’s the bully, I don’t. America’s not the bully. America is the defender of what’s right in the world. That’s my opinion, but I can say it’s all about choices. I don’t try to give many my choice, but what I’m saying to you, you asked me a question, here’s what I believe; could have I avoided the question and said something else? Yes, but I’m not politically correct. I’m not trying to be politically correct. Amy Jacobson: And we wouldn’t like you if you were. Dan Proft: Could we entice you to go to the convention if you knew the Beach Boys were going to play at the convention? Mike Ditka: If I knew Elvis was going to be there, I’d be there. Amy Jacobson: Bruce Springsteen. But if duty calls, if Donald Trump personally… Mike Ditka: I don’t know. I really don’t know. Like I said, this all came up and nobody’s told me a thing about it, then somebody started texting me yesterday saying, “Look at this, look at that, you and Mike Tyson”. And I said, this is the first I’ve heard of it, believe me. And I’m not lying to you. The first I’ve heard of it was yesterday. I happen to be working on my terrific golf game, which sucks, but I was really busy. Amy Jacobson: You and Dan have something in common. So if Donald Trump calls you, do you think then you will go to Cleveland, to the GOP convention? If he asks you personally to do so? Mike Ditka: I don’t like to travel anymore, but I think I can get to Cleveland if he called me. Dan Proft: There you go. Amy Jacobson: That’s the answer we were looking for. Dan Proft: You can guarantee that call will be made. Coach, before we let you go, we have to ask you about the passing of Buddy Ryan and your reflections on Buddy Ryan. Mike Ditka: I think everybody said everything there is to say, you know, and after the fact everybody’s, “Well, he’s just saying that now”, but Buddy was special. I think, and I told people this yesterday, because of the way he coached defenses, and those schemes he had on defenses, that’s why the offenses in football are so good today. That’s why they’re spread out. That’s why they have modular sets to get the ball to different people; because of what Buddy created. Because you could not play the old conventional offence against his defenses, he would kill you. So he was way ahead of his time in thinking, but he’s a pioneer in the fact, he’s probably never thought of this way, but he’s really changed the game of football, offensively, and he was a defensive coach, because people had to make great adjustments to limit what they were doing on defense. His legacy is terrific. Guys, I had to tell somebody yesterday, I didn’t coach the defense. I had nothing to do with the defense. He coaches defense. They had their own meetings, they had their own thing, and they were their own group, and they were good, really good; maybe one of the best ever. We had an offence. We had to get our job done. We had to uphold our end of it, and we did, so together we did something that neither of us were able to do alone. We won a championship. Amy Jacobson: We still appreciate that, and you too kind of had a rocky relationship, but in the end did you work things out? Mike Ditka: Well, yeah, but when you say rocky, who says it’s rocky? I think when you’re young the egos get involved, and there’s no question about that. And I was probably at more fault than anybody. But I had nothing but the greatest respect for people who know what they’re doing and become leaders. And Buddy did all that, and he made men out of boys. He made us a very great football team. I’ve said that from day one, so he didn’t have to pass away for me to have the respect that I have for him. I loved Buddy Ryan for who he was and what he meant for the Chicago Bears. I don’t know that you can say too much else in that. You spin the wheel anyway you want to spin it, but my god, did we have tea together? No. Did we have fun together at times? Yeah, we did have fun together at times, but then you get into the situation. After we won the Super Bowl, Buddy left. So then it became a big competitive situation, built up by the media, and that’s okay. We both lived through it, we both survived it, but I’m just saying; a lot of that was made up by the media, guys, and you guys are in the media, but I know you didn’t make that up. But a lot of things were made up by the media. The relationship was never as rocky or as bad as people made it, but it seemed like to be good ink, so people wrote about it. Dan Proft: Yeah, imagine the media sensationalizing something. Mike Ditka: No, that could never happen. Dan Proft: Alright, he is Hall of Fame Bears coach and player Mike Ditka; good luck with the golf game, and we’ll see you in Cleveland. Mike Ditka: Alright, God bless you, take care, bye-bye.!

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Marques Gaines case is reason to reflect: Are we guilty of ‘bystander effect’?

This post originally appeared in the  Chicago Tribune  on 4/26/2016   A video of the incident can be found  here .   By, Dan Proft  What would you have done early on that February morning had you come upon an unconscious Marques Gaines lying facedown on State Street at a busy Chicago intersection?  Would you have come to Gaines’ aid? Be honest.  Research suggests that only 1 in 55 of us would have.  No one assisted the 32-year-old man after he was punched unconscious and left prone on the street. Surveillance video released in mid-April showed more than a dozen people nearby failing to come to his aid. At least one person, reportedly an employee of the 7-Eleven on the corner, called 911. But no one outside even bothered to shield Gaines from traffic, though two predators swooped in to pick the injured man’s pockets. Eventually Gaines was accidentally run over by a taxi, and he died after finally being taken to a hospital.  Cornell University sociologists recently released a study that found only 1 in 39 Americans would respond to assist their fellow man in a health emergency. But add race as a factor (Gaines was black) and the research is even more alarming. The likely response rate to help a black person with a health emergency was 1 in 55, compared with 1 in 24 for a white person in dire straits.  Much has been written about the so-called “bystander effect” in the wake of the release of the video detailing Gaines’ unnecessary death.  We rationalize our own behavior. We want to absolve ourselves and blame the proprietor of the 7-Eleven.  We are good people, we think to ourselves. If not for some group psychosis, of course we would render aid to a man in need.  In our therapeutic culture, there is always a ready-made psychological explanation for man’s inhumanity to man so any consideration of our moral depredation may be avoided.  The two scavengers who scurried to rob Gaines while he was out cold are not vile, we tell ourselves. They are victims of economic injustice that pushed them into a life of picking at the bones of their brethren. We must not assign opprobrium, we must enact a $15 minimum wage.  And the post-moral rationalizations similarly abound for those who blithely meandered past Gaines finding nothing out of the ordinary with a young man lying facedown in the middle of State Street.  I could get attacked, too, we think. I don’t want to expose myself to any legal liability by helping.  I am not a medical professional. I didn’t want to do more harm than good, we assert, ignoring that it doesn’t take a medical professional to call 911 or to stand by until first responders arrive, or to enlist others to rally assistance.  I pay taxes so that other people will respond to such situations. I gave at the office. The list goes on.  In America today, we are much more content to be our brother’s sugar daddy than we are his keeper.  Gaines was punched. He was robbed. He was run over. There were three opportunities to prevent his death and many onlookers present to seize them.  None did.  This is not a new phenomenon. Kitty Genovese was stabbed to death in New York in 1964 while residents who heard her cries for help did nothing. They didn’t want to get involved either.  In our atomized society, we are encouraged to live autonomous lives in which the only responsibility we owe anyone is to live “my truth.”  Your truth says you help someone in distress, my truth says I don’t.  When we conclude those views are morally equivalent, social mores disappear, the bonds that hold civil society together fray, good Samaritans vanish and Marques Gaines is roadkill.   Dan Proft is a talk show host on WIND-AM 560.

This post originally appeared in the Chicago Tribune on 4/26/2016

A video of the incident can be found here.

By, Dan Proft

What would you have done early on that February morning had you come upon an unconscious Marques Gaines lying facedown on State Street at a busy Chicago intersection?

Would you have come to Gaines’ aid? Be honest.

Research suggests that only 1 in 55 of us would have.

No one assisted the 32-year-old man after he was punched unconscious and left prone on the street. Surveillance video released in mid-April showed more than a dozen people nearby failing to come to his aid. At least one person, reportedly an employee of the 7-Eleven on the corner, called 911. But no one outside even bothered to shield Gaines from traffic, though two predators swooped in to pick the injured man’s pockets. Eventually Gaines was accidentally run over by a taxi, and he died after finally being taken to a hospital.

Cornell University sociologists recently released a study that found only 1 in 39 Americans would respond to assist their fellow man in a health emergency. But add race as a factor (Gaines was black) and the research is even more alarming. The likely response rate to help a black person with a health emergency was 1 in 55, compared with 1 in 24 for a white person in dire straits.

Much has been written about the so-called “bystander effect” in the wake of the release of the video detailing Gaines’ unnecessary death.

We rationalize our own behavior. We want to absolve ourselves and blame the proprietor of the 7-Eleven.

We are good people, we think to ourselves. If not for some group psychosis, of course we would render aid to a man in need.

In our therapeutic culture, there is always a ready-made psychological explanation for man’s inhumanity to man so any consideration of our moral depredation may be avoided.

The two scavengers who scurried to rob Gaines while he was out cold are not vile, we tell ourselves. They are victims of economic injustice that pushed them into a life of picking at the bones of their brethren. We must not assign opprobrium, we must enact a $15 minimum wage.

And the post-moral rationalizations similarly abound for those who blithely meandered past Gaines finding nothing out of the ordinary with a young man lying facedown in the middle of State Street.

I could get attacked, too, we think. I don’t want to expose myself to any legal liability by helping.

I am not a medical professional. I didn’t want to do more harm than good, we assert, ignoring that it doesn’t take a medical professional to call 911 or to stand by until first responders arrive, or to enlist others to rally assistance.

I pay taxes so that other people will respond to such situations. I gave at the office. The list goes on.

In America today, we are much more content to be our brother’s sugar daddy than we are his keeper.

Gaines was punched. He was robbed. He was run over. There were three opportunities to prevent his death and many onlookers present to seize them.

None did.

This is not a new phenomenon. Kitty Genovese was stabbed to death in New York in 1964 while residents who heard her cries for help did nothing. They didn’t want to get involved either.

In our atomized society, we are encouraged to live autonomous lives in which the only responsibility we owe anyone is to live “my truth.”

Your truth says you help someone in distress, my truth says I don’t.

When we conclude those views are morally equivalent, social mores disappear, the bonds that hold civil society together fray, good Samaritans vanish and Marques Gaines is roadkill.

Dan Proft is a talk show host on WIND-AM 560.

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Dan Proft & Ted Dabrowski: The Cost Of Increasing College Tuition

On this edition of “Illinois Rising”, Dan Proft and Ted Dabrowski, VP of Policy, Illinois Policy Institute, discuss the Chicago Teachers' Union strike, if Chicago is on the road to Detroit, an administrator at the University of Illinois who makes $900,000 a year while tuition costs skyrocket and where we can start consolidating Illinois’ 7,000 units of local government.

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Dan Proft: Thank you for joining us on another edition of Against the Current; coming to you from the Skyline Club, on top of the Old Republic building in downtown Chicago. My name is Dan Proft, and our guest on this episode is Ted Dabrowski, who is the Vice President of Policy for the Illinois Policy Institute, the Free Market Think Tank, economic liberty orientated think tank in downtown Chicago. Ted, thanks so much for joining us, appreciate it. Ted Dabrowski: Thanks for having me. Dan Proft: There’s a lot to talk about. You’ve got judicial decisions, as relates to pensions, both at the state level, with regards to Chicago pensions coming on the heels of Illinois Supreme Court’s decision from just a year earlier on state pensions, and then you’ve got the Supreme Court decision because of these Scalia absence on the Friedrichs v. California Teachers Association, as it pertains to forced union dues; that’s a lot to talk about against the backdrop of the second teachers’ strike looming in less than four years, and an almost junk-rated city of Chicago, according to Fitch, mostly because of the inability to solve the pension problem, combined with a junk-rated Chicago public school system, combined with the state, that has the worst credit rating in the United States. So, some challenges I think is a fair assessment. Ted Dabrowski: Some pretty big challenges. Dan Proft: Yeah. So why don’t we start with Chicago public schools, and the looming teacher strike over the teachers’ unwillingness to increase their contribution from 2 percentage points of the 9 percentage points they pay into the pension system to not have the Chicago Public School System pick up the other 7 percentage points anymore, as it’s been the case for the past 3 decades. Of course, the management side wants them to pick it up, so they can start trying to make the math work, and the teachers don’t want to essentially take a pay cut to increase their contribution to their pensions. Why is the teachers’ position unreasonable? Why should they pick up the 7 percentage points that the school system has been picking up for these past 3 decades? Isn’t that just another promise that was made to them, like they say, the Constitution made a promise to them and it shall never be changed? Ted Dabrowski: It’s another perk that Chicago teachers have had for a long time. It was gained back in 1981, and the issue, I think, the bigger issue is that the Chicago teachers do pretty well when you compare them to big cities across the country. They have the highest salaries of any big school district in the nation, and so what’s amazing is… Dan Proft: So higher than New York, higher than California, higher than L.A, higher than Houston. Ted Dabrowski: Higher than Miami, etcetera. So, they do pretty well, and again, it’s something they’ve negotiated, but they’ve done well, and included in that is this teacher pension pickup. That’s fancy words for, “Look, teachers, you don’t have to pay your full pension share, full pension payment you’re required to pay. We, the School District, which means tax payers, will pay it on your behalf”. And that’s been going on for about 3 decades, and the School District is broke, any way you look at it, it’s broke. And so CPS, Claypool and others trying to fix the problem are asking the teachers just to pay their fair share. Dan Proft: And by the way, I had the opportunity on the morning show that I do on AM 560, Chicago’s Morning Answer, to speak with Jean-Claude Brizard, a couple of CPS superintendents ago; this is not the CPS superintendent that’s going to jail, for those of you scoring at home, but they were running billion dollar budget deficits when he arrived as Rahm Emanuel’s first Chicago Public School superintendent. Nothing has changed in the intervening 5 years; in fact, it’s gotten worse, so do we start with the pension pick up and the distribution of who’s picking it up, or do we start with the fact that 9% paying into your pension, that’s also insufficient. Ted Dabrowski: Right, that’s insufficient. I think that the bigger issue is that the School District has been mismanaged for a long time, and you’ve got issues from not funding pensions for nearly a decade, you’ve got issues of Barbara Byrd-Bennett being indicted for fraud. You’ve got a situation where you’ve got a Teachers’ Union that’s willing to strike two contracts in a row, and they’ve won the last contract. They won big; they strike, despite the fact that the city, or the district, was already billion dollars in the hole. They had no business striking then, and they have no business striking now. So really, what you’ve got is a situation… Dan Proft: But they strike because… they struck, they won, so they’re not incentivized to do anything other than strike if they don’t get what they want, because they figure that the politicians will bend over… Ted Dabrowski: Like they have… Dan Proft: Like Tiny Dancer did four years ago. Ted Dabrowski: And he’s even weak. If he was weak then, he’s even weaker now, given the situation he has at home. So this is a situation where the two big groups, the Administration and the Teachers’ Union, they collude when they need to, they strike when it makes sense to then, and in the end it’s all the kids who get left out, and I think that’s the whole sad part of the story, which is why many people talk about bankruptcy. If Rahm Emanuel doesn’t want to do something about the finances, if Karen Lewis doesn’t want to do something about the finances, let it go bankrupt, and finally get a situation where we can get a focus back on the kids and not on the adults. Dan Proft: Well, that’s what the Governor said, Governor Rauner has said, “Bankruptcy needs to be something that the city and CPS take under consideration”. They’ve rejected that because of course, nobody wants to be the person, or people in charge, right, to be taken over by the state, to go bankrupt on my watch; what does that say about my leadership and my management; making the tough decisions to bring us back from the precipice, just rather than pushing us over. So why not – and this is more of a political question than a policy one – but from Governor Rauner’s perspective I’ve offered to pitch in and help. I’ve offered, here are some options, and by the way, I have kind of a 30 year track, because the reason I’m 100 millionaire is because I’m pretty good at reading the balance sheets and understanding what the real world options are, and if they don’t want to entertain real world options, why not just wash your hands and just say, “Okay, geniuses, okay, Tiny Dancer, okay Karen Lewis, whatever, Forest Claypool, you figure it out. But you can come down to Springfield with your pickle buckets and panhandle outside the Capital, and we’re not giving you anymore money”. Ted Dabrowski: Yeah, and I think politically that’s where it goes. I think that’s where it goes, and the sad part is – and I think everybody knows this – is that, you know, we just had a massive property tax hike in Chicago; the largest on record, and that only solves a small part of the problem; we probably need to have another two of those to try to start getting toward balance, and so the sad part is that Chicagoians are already burned with all kinds of nickel and diming fees, and red light… you know, anything you want to talk about, there’s a fee or a tax for it. Chicagioans can’t afford more, and we’ve already heard about people leaving the city. Dan Proft: But at least Teachers’ Union is honest about… I mean, I give them credit… they’re kind of like Bernie Sanders; they are like the honest socialists, as opposed to the disingenuous socialists. Property tax increase – sure. Chicago Teachers’ Union is on board for that; Karen Lewis – yeah; Graduated State Income Tax – yeah; fine. Ted Dabrowski: Financial services is back. Dan Proft: Yeah, on Nassau Street, on the exchanges, financial transactions – good. They’re contemplating the institution of a new city income tax to layer on to all the other taxes – we’re open to that; all they care about is the revenue side; at least they’re genuine about it, so you can have an honest conversation. Tiny Dancer and the Chicago Democrats trying to cling to power, they understand the political difficulty of that, because they have to stand for election outside of 30,000 teachers, and so they play this game like something can be solved by getting a half of billion dollars every other month from the state of Illinois. Number 1 – it doesn’t solve it; number 2 – it’s not going to happen. So do you give the Teachers’ Union at least credit for being honest, so we can have an honest conversation? Like here is where they want to solve the problem; that’s one option. Confiscatory taxation on top of confiscatory taxation; and here’s another option, like you and the Illinois Policy Institute have charted, that presents a real choice for Chicago residents and Illinois residents to consider. Ted Dabrowski: I think you’re right, they are, to say, honest about their motives with you, and Karen Lewis is pretty clear about it, but I think that’s why we call them the most militant union in the US. They say what they want, they strike for it and they go for it. Dan Proft: And they unironically wear red shirts to their rallies. I mean, beat me over the head with a cudgel, I get it. Ted Dabrowski: I think the saddest part for me – and the parents haven’t figured it out yet – still the parents are still backing with the Union. In the first strike they did it still seems like they have backing, but at some point that’s going to break, and when people realize that those strikes mean bigger and bigger taxes, increase in property tax, especially for the low income families, right, because they may not pay property taxes because they’re owners, but they certainly pay higher rent; they certainly pay higher sales taxes, higher X, Y and Z, and at some point there’s got to be a connection. Dan Proft: But those are the unseen costs that they don’t kind of…are people connecting the dots. Because it seems to me what Karen Lewis is good at doing – and to some extent, Rahm is good at doing as well – is presenting it like Rahm and Karen Lewis are on the opposite sides. They’re not on the opposite sides. They’re fighting over who gets to be the central planner in charge, right? And so the free market perspective of the economic liberty movement, to some extent has to also bear some culpability for not charting a third way, and explaining to people that you’re getting played by both sides. They’re not looking out for your best interests, and they don’t have a plan that solves this without imposing additional duress on you, on your children, on the taxpayers read large, so that the city continues to shrink and the number of revenue producing wards continues to winnow, and we continue the death spiral to a place that you’re not going to be insulated from in terms of pain. Ted Dabrowski: No, I think you’re right, but these guys have always worked together. That’s why I said they collude. They’re like two monopolies, or an oligopoly, and they work together pretty closely; they choose to fight every once in a while, but never – and if you think about this, are the discussions and the fights about better outcomes – we don’t hear much about that; it’s all about who’s going to win the power struggles; whether it’s Rahm or there’s Karen Lewis; whether it’s Claypool, whether it’s Rauner in the takeover; but nobody’s talking about how to help the parents win. And what you’re right about is that really this is a battle over who controls billions of dollars in salary, and billions of dollars in pension payments. And Rahm loves to be in control of that, and so does Karen Lewis. Dan Proft: I know, the 6 billion dollars CPS budget; what is it, a third of it is salaries? Ted Dabrowski: Oh yeah, you’ve got over 2 billion, sure. And so that’s the control power, and so when we talk about, and you’re right, the free market movement that hasn’t done a great job in Chicago, in Illinois, about saying “Hey, it’s time we take the power out of Rahm Emanuel; it’s time we take the power away from Karen Lewis, and give it to the families; let them be in control of the dollars, and let them hold schools accountable”, and by that I mean the parent would have the ability to walk away from the school and use that public money for a private school, if he/she wasn’t having their kids’ needs met. Dan Proft: Or a public school. Ted Dabrowski: Or a public school. It could just be give them the power to walk, and when the parents have that power, then the public schools would have to listen. Dan Proft: Well, you say, you know, the parents side with Karen Lewis and the Teachers’ Union; well, that’s because they experienced the teachers. Right, their kids experienced the teachers, and so they like Mrs. Smith, who teaches 4th grade, and they like Mr. Jones, who teaches 8th grade. They know those two, so when Mrs. Smith or Mr. Jones or their local school principle says, “Are you going to throw in with me, or are you going to throw in with that little cleptocrat on the 5th floor of City Hall?”, that’s an easy choice. Ted Dabrowski: It is, but I think, though, more and more teachers are starting to realize; and if you’re a 35 year old teacher and you hear the arguments going on, you say, “Wait a minute, is there going to be a pension for me? I’m going to contribute for years; will there be a pension for me?”, and I got a call yesterday, as a matter of fact, from a teacher; she’s 67, retired from CPS, lives in the suburbs, and she’s scared to death whether her pension is going to be cut totally. Dan Proft: When did she retire? Ted Dabrowski: She retired just a few years ago. Dan Proft: So about the average age of 63, which is like the average age of a CPS teacher retiring? Ted Dabrowski: The average retirement age is closer to 60, so over half retire in their 50s, and you’re hitting on a good point, Dan. The reason these pensions are so expensive is because the average worker who works there is retiring in their 50s, most of them with full benefits, and because they get automatic costs for living adjustments, those pension benefits double after 25 years. It’s a fantastic gig, and it’s something that tax payers can’t afford. Dan Proft: Let’s talk numbers, kind of get out of the unfunded liabilities and the billions, and this and that, that don’t mean anything to most people, and you can’t kind of distill down to something they can’t relate to. Let’s relate it. So the Chicago public school teacher retiring in 2014 with 30 years in max out in terms of pension, what annual pension are they receiving? Ted Dabrowski: About 68,000. Dan Proft: $68,000? Ted Dabrowski: Right. $68,000. Dan Proft: Which is almost 40% more than the medium household income in Illinois? Ted Dabrowski: Sure, close. And you can compared a medium household income; that’s more than one person. Dan Proft: So maybe it’s 25% more than the medium household income in Chicago. It’s still a big number. I’ve looked at the work that you and Illinois Policy Institute has done, and I just want to relate these numbers because they are staggering for anybody that works in the private sector, and frankly, anybody that works. This is IPI numbers – a Chicago public school teacher retiring in 2014, 30 years in will have paid these around numbers, $133,000 into their pension, will receive 2.1 million dollars back, a 15,000% plus return on investment. Ted Dabrowski: And let me just say one thing, that that 133 is giving the teacher credit on having made the full payment, when in fact the school district was picking up… Dan Proft: Would they had made less than 25% of it. Ted Dabrowski: Correct. So it’s phenomenal. These are great returns. Dan Proft: You’re right. So how do we have a bankrupt school system, and a bankrupt city, and a bankrupt… I mean, come on? Ted Dabrowski: And how many people in the private sector have 2 million dollars from having their career sitting there waiting for their retirement? Dan Proft: What’s the private sector counterpart? I think you guys have this too. So if you wanted the average retiree kind of same-similar situated, if you wanted to receive 2.1 million dollars in pension benefits back, pay yourself 70 grand+ a year in retirement, how much would you have had to contribute into your 401? Ted Dabrowski: Around one and a half million dollars, because interest rates are so low, so you’d have to put in a lot of money just to get that. Dan Proft: So in the private sector it’s one and a half million dollars in for 2.1 back; at CPS it’s 133 in for 2.1 million back. Ted Dabrowski: Correct, and this is phenomenal. And it’s not sustainable, I mean, don’t forget the reason why it’s so high. That 2.1 million is because they get that 3% automatic bump in their pension benefit each period. Dan Proft: The cost of living adjustment turned out to be an annuity because that’s seven times the rate of inflation for the last decade. Ted Dabrowski: Correct. And so basically, somebody’s pension benefit doubles over 25 years. It’s phenomenal. Dan Proft: And this is the case – not to get too far field off of teachers and CPS's; that’s really kind of at bar with the strike looming in May – but the numbers for Chicago firefighters, for Chicago police officers, for city of Chicago municipal employees, for city of Chicago laborers, and the laboring public sector, they’re basically the same. Ted Dabrowski: Pretty similar, yeah; of course, Chicago police and fire will be a little higher. But basically it’s the same, and you’re talking about the average career worker getting somewhere in 2 million dollars and more in retirement; and it’s really hard to ask taxpayers who are struggling to pay that over and over again. Dan Proft: And so, when you look at these numbers, the public sector union, a lot of the ranking file, the response is “Wait a second; why are you attacking teachers, and firefighters and police officers? Don’t you respect the job we do?” And even if you say you respect the job that we do, “Hey look, we play by the rules that were set forward by the politicians that set the rules, so why should we take a haircut, when they made a promise and we relied on that promise?” Ted Dabrowski: I think it’s a good argument. Look, I always want to blame the people who set the laws. It’s the politicians who agreed to bad deals. I think everybody fights for their own special interest, whether it’s the Teachers’ Union, or an employee wanting a raise, or better terms, so I think it’s important that we don’t vilify teachers or cops; my kids go to the public schools. I love my kids’ teachers. I think they do a great job, but the bottom line is this is not about that. This is about the state’s ability, and people’s ability, and taxpayers’ ability to pay for these benefits, and so I don’t think we should vilify them, but I think there has to be realization that the agreement, whatever it was… we should meet whatever obligations we made; whatever’s been promised and has been earned we should pay. But going forward we need to strike a new deal, and I think that’s what this whole discussion is about. Striking a new deal that’s fair for the public sector workers, but also fair for the tax payers that fund them. Dan Proft: Yeah, I just want to emphasize that, because this seems to get lost in the conversation; I have the opportunity to talk to and hear from the public sector workers a lot in my radio program, and they don’t seem to hear it when I say “Wait a second, whatever you’ve earned, even if it was a bad deal, you should get, because there was reliance created by the state, you did anticipate these benefits, you earned the benefits, you should receive what you’ve earned. Full stop; however, at a date into the future, certain, like a year from now, there’s a new deal for the existent workers who have not earned those benefits, because they haven’t worked those days in the future yet, as well as for new hires, that is not going to be the same deal that you have now”, and point of fact, don’t we have that with the state employers with the tier 2 for new higher at this point, even at present? Ted Dabrowski: Yeah, so of course, tier 2 is a brand new employee, but I think what we’re saying is that for even existing employees – and this happens in the private sector every day. The private sector can’t take away benefits you’ve already earned. That would be a huge problem, and that shouldn’t happen here in Illinois either, at the state or city level. But going forward, we have to have a deal that allows the state budget, the city budgets – because we haven’t talked about cities; this is a huge problem all across Illinois with pensions for firemen and policemen… Dan Proft: And nationally. Ted Dabrowski: And nationally, of course. It’s a huge problem everywhere, and it’s pushing up property taxes – I’d like to talk about that in a minute, about all the taxes that are going up, but at some point there has to be another deal, because here’s the issue; right now you and I are saying we want to protect benefits we’ve already earned; if we ever go into bankruptcy courts, federal courts don’t care about state Constitution; federal courts trump the state Constitution, so like you saw in Detroit, like you’ve seen in Alabama, like you’ve seen in Rhode Island, pensions have been cut as a result of bankruptcies, and so if the public sector union workers don’t finally realize that they can actually have their pensions cut under bankruptcy, they’re going to get hit with exactly what they don’t want to see. Dan Proft: So many of them are listening to their public sector union bosses, rather than looking at the math and just taking a common sense approach to it to say “Do I really want to pay Russian roulette with my retirement?”. It’s not roulette; it’s Russian roulette, because all it takes is one federal bankruptcy judge to say, for example, “Yeah, states cannot go bankrupt under federal bankruptcy code”. But if pension funds go upside down and they can no longer pay out beneficiaries, then I’m going to say that pension funds are separate and distinct from the state, and instead of checks in the mail you get IOUs until they figure it out. Ted Dabrowski: Or you have a 15% - 20% haircut. And I think that’s a real distinct possibility. That’s why I think at some point, and I think the state ruling recently that came out last week… Dan Proft: This is on Chicago pensions. Ted Dabrowski: On Chicago pensions; where it starts to say that things like pension benefits can’t be collectively bargained if there’s some exchange, some consideration given for changes in the pension benefits… Dan Proft: Simple contract law theory. Ted Dabrowski: Exactly. And that being the case, I think behooves the unions. And let’s talk about Chicago policemen and firemen. You were talking about teachers and others. The worst funded pensions in Illinois right now are the Chicago fire and police pensions. They have about 25 cents of every dollar they should have in their account. So imagine, you have your 401(k), you open it up and you think you have $100,000. You open it and there’re only 25,000. You’re missing three quarters of the money. That’s exactly what’s happening to policemen and firemen right now. And I don’t know why they’re not jumping up and down and saying “I want a new deal. I want something better. Promise me what I’ve earned, but give me a new deal going forward”. And I think that’s what they should be fighting for, because they run the big risk of having a massive haircut. Dan Proft: If you have a police fund or a firefighter pension fund that’s only a quarter funded, are those pension funds salvageable. Ted Dabrowski: I think, we’ve run numbers, I think we can salvage them, but it’s painful, right? And you’ve got to have a long term process, but you got end the game now. But effectively, in any private sector scenario, they’re bankrupt; they’re done. They would have been closed up if they were part of a private sector group, they would have been closed, liquidated and gone. So it’s something, I think, they have a huge interest in hitting the table and negotiating. I think the way to look at this, Dan, if we can stop the bleeding now, and move to a new 401(k), stop playing go and forth for all benefits earned going forward, then what we do is we treat the unfunded liability as debt. Chicago just has a bunch of debt and it’s going to take years to pay that debt off; but I think it can work with Chicago’s numbers if we stop the pain. Dan Proft: Then you can start to bend the cost curve and catch up. Ted Dabrowski: Exactly, but it’s not just police and fire, you have to do that for teachers’ pensions and for the other pensions in Chicago, so it has to be a whole deal, because remember, you have one taxpayer in Chicago, and that one taxpayer has to pay all those pensions and Cook County pensions as well, and of course, the shortfall at the state-level; so we have to be careful to respect the taxpayers in Chicago. Dan Proft: It seems to me the taxpayers are starting to understand what is in the offing, and I just look at out-migration; is there any better indication of the vitality of a community, county or state than whether people choose to live there or not, and in 2015, according to the census, Cook County lost more population than any other county in the country; this against the backdrop of the state of Illinois continues to compete with New Jersey for the largest out-migration year after year. Ted Dabrowski: I think that’s the biggest issue, and it’s something that we talk a lot about as respecting the taxpayer. And I don’t think Rahm Emanuel, Michael Madigan, they don’t understand… sorry, they may understand, but they don’t care; it doesn’t fit into the political calculus, but the reality is that people are leaving and I think more telling them the 2015 numbers is the out-migration that occurred between 2000 and 2010 by middle class Blacks. 180,000 blacks were lost during that period, and if you look at what happened in Detroit; first you lost the White taxpayers when you had the White Flight, but the problem really happened in Detroit when the middle-class Blacks left. And then the tax base was gone, and I think Chicago has to start thinking about how to protect its residents – doesn’t matter what color they are – but if you don’t protect your tax base you’re done. And we’re entering that spiral today. Dan Proft: Well that’s interesting, so I have a conversation with my aldermen; I’m in the 42nd ward when, you know, the wards that looks fancy on the outside, and you hear this propaganda from the likes of a Brendan Reilly, who’s just a toady for Madigan and for Tiny Dancer. Well, look at the planters on Michigan Avenue, and look at the tower cranes with new rental units going up in Streeterville. Everything’s on the up and up, and my response to them is, even let’s accept your premise, that this ward, one of 50 wards, is on the up and up; explain to me how you think – let’s say there’s 10 wards, 20% the city, that are kind of revenue producing wards that have substantial economical activity ongoing – so you’re telling me that 80% of the city can burn to the ground around us and we’re not going to be impacted? Do you really believe that? Does anybody really believe that except a craven feudal lord, which is what these aldermen are? Ted Dabrowski: I remember the first time I went to Detroit right after the bankruptcy, and I came back and wrote about it, and the lessons I learned from it, as it relates to Chicago; a lot of pushback, you know, Chicago is not a Detroit. Dan Proft: No, never happen here. Ted Dabrowski: And listen, Chicago’s not a Detroit when you think about the diversification of businesses; you walk down in the loop here, it’s hot, man, it’s rocking, it’s a lot of stuff going on, but I think what people forget is bankruptcy is not about what you look like; bankruptcy is whether you can afford to pay your debts. It’s simply that, and you take the best paid athletes in the nation. A lot of them go bankrupt; they’re making 100 million dollars, but they go bankrupt because they don’t manage their spending, and I think that’s where Chicago is. Dan Proft: Yeah, how can they be bankrupt? They’ve got a nice home, they’ve got a nice car and they wear nice clothes? How can they be bankrupt? How can Antoine Walker – he’s an NBA champion – how can he go bankrupt? Terrible investments; he put his money to use in all the wrong places. That’s how you can go bankrupt. Ted Dabrowski: And I think that’s where Chicago is. Chicago is exactly there. And let me make one other point, and I think this is important. Chicago’s got a big footprint. We used to have 3.5 million people, right? We’re down way below that. The population in Chicago now is below the 1920s. That’s a massive change. We still have that same infrastructure, and I don’t just mean physical infrastructure, like the highways and all that. We have the same public sector infrastructure, and that public sector infrastructure’s not shrinking fast enough with the city. What it’s doing is it keeps growing; the cost of that infrastructure, the unions, the teachers, the police and fire; it’s too expensive. It’s outpacing the growth of what people make in the city, and that’s what’s going to break us. Dan Proft: So you wanted to talk about the taxation that your median Chicago resident faces. Let’s talk about it. Ted Dabrowski: What you see in Chicago is a lot of people saying “Oh, property taxes are much, much lower in Chicago than they are in the suburbs. Dan Proft: Subsidized by commercial. Ted Dabrowski: Subsidized by commercial one, but two, they are relatively lower, but what people don’t talk about is the… you know, Daley was a genius. We all know that. He knew that he shouldn’t go after property taxes, so what he did, and the other who followed, is they came up with a bottled water tax, and a dollar tier tax, then you had to add the red light cameras, they had every kind of tax and fee to hide the fact that the raising taxes on you. And it’s really hard to track what’s going on, so we did all the numbers, and it’s amazing how much higher, when you take all the taxes that there are in Chicago than in any other city – Evanston’s a competitor – but any other city in Illinois, the taxes are tremendously high. So I think there’s a lot of deceit, the press hasn’t wanted to talk about it properly, none of the politicians want to talk about it, but Chicagoians are taxed up the zahzoo, and in the end, middle class families know it; I think, when we talked about the Black families earlier, schools aren’t working for them, crime is certainly hurting them, and taxes are going against them; why stay? And I think that’s a question that people ask themselves. Dan Proft: Sure, and they ask themselves and they’re answering in the negative. Why stay? It makes no sense not to stay. Ted Dabrowski: And it’s not easy for people to leave, right? It’s hard to pick up and leave. Dan Proft: Right, sure. You laid down routes, you made an investment here, it is a great city, it’s a beautiful city, it’s a fun city; great restaurants and night life and arts and culture. Why do I want to leave here? I don’t want to leave here, but you’re making it such as I can’t make it make sense to be here. And frankly, even someone like me - who does relatively well, because I’ve got phony baloney job on the radio that pays me a lot of money and I work 20 hours a week - even me, I say, “Gosh, move over to Northwest Indiana and lower my cost of living by 40%, my muffling it up by 40%? What am I doing here? Ted Dabrowski: You’re hitting on the issue that recently I was in South Chicago, and I met with this company, Modern Drop Forge – they’re a big steel stamp planter, steel stamper – and they tried to stay in Illinois, they worked hard, nobody paid attention to them; this is a year and a half ago; and so they finally looked at Indiana, and Indiana opened their arms, said come here, the company eventually moved there. I was at there, I think I was telling you about this. I went to their new facility, this massive, beautiful huge facility; state of the art, and a lot of the workers who didn’t want to move to Indiana from Chicago, they went and they looked at the house prices and said wow; they looked at the property taxes, much lower; school choice. Dan Proft: And what you get for those numbers in terms of home and property. Ted Dabrowski: It’s a huge home, and he said he took his wife, this worker who didn’t want to go, he took his wife; they moved. And they’re so happy; and I saw him at the new plant, he’s ecstatic, and that’s what people are experiencing, and we shouldn’t force people to look at those alternatives, but I think what we’re doing is we’re making it such that people… people don’t move because their taxes are high. People move because things get difficult, the opportunities aren’t there, it gets too costly; they finally make a calculus and some way say “Hey, I’m going to go somewhere where there’s a new opportunity”. Whether it’s Atlanta, Houston, Dallas, whatever. Dan Proft: Well right, it’s cumulative. It’s not a single tax, it’s not that if I don’t have a city sticker, my fine is going to be like $42,000 to make the numbers work for the city for one year additional. It’s just the cumulative impact of every time you turn around, you’re just being fleeced. Ted Dabrowski: So it comes around to that’s why we need these massive reforms, and until we get them… Dan Proft: Which, by the way, the funny thing is, the other side, that has been unwilling to advance these structural reforms says we need these structural reforms. What did Rahm come in on? He came in on a wave of here’s a tough guy, he was the Chief of Staff to the President of the United States, and he’s going to make these tough decisions. He’s going to endure the political capital that must be spent to make the difficult decisions to bring the city back, to right the financial ship; and he hasn’t done it. Ted Dabrowski: This is Rahm though, right? He was the guy that was going to let nominate crisis go to waste. Dan Proft: The tutu should have been the leading indicator that this was not a tough guy. Ted Dabrowski: A lot of people were excited, and it’s amazing, because he actually did something that is pretty bold when he first came in. He went down to Springfield, and he sounded like he was proposing the Illinois Policy Institute’s ideas. He talked about COLA – Cost of Living Reforms – producing them, he talked about bringing retirement agents down, and he talked about optional 401(k) style plans for workers. That was awesome, he actually went down to Springfield and did that, and Daley didn’t do that, he didn’t go down to Springfield. So there was a lot of hope in the beginning, but quickly, once the negotiations got tough, once Karen Lewis put her foot down, he caved. Dan Proft: Well the 401(k) thing was interesting, because the response you get from a lot of people is “I don’t want to be subject to market fluctuations; I guess it’s okay if everybody else who is not in the public sectors is subject to market fluctuations with respect that they’re 401(k)s, but we want a guarantee, the define benefit plan”, and so the response to that, that we want this guarantee, 401(k) doesn’t work for us, at the university level, this is kind of an under-reported story, but you were the first one to kind of alert me to this. There are thousands of actual university employees, public employees in this state who are part of a 401(k) retirement system within the larger public university system, so number 1 – is it working for them? – number 2 – if it is, why don’t we scale it? Ted Dabrowski: Well, what’s amazing is that somewhere along the way, 1998, not Mike Madigan, but a guy named Robert Madigan, he passed a law that allowed university professors to have a 401(k) style plan. Why? University professors wanted that portability. They wanted to control their retirement fund. They wanted it to be in their name that they could take when they left the state if they left. Now what’s amazing is that we would allow a professor to have that, right, but not a Chicago fireman, a policeman, or a teacher, who should have their ownership, their own title and control over that money; rather than being dependant on Madigan or Rahm Emanuel, these university professors can take their money and nobody can touch it. And what’s interesting about that whole thing is we’re sitting again almost on record highs in the stock market; these guys are doing really well. The money that’s in there is going up, and despite the massive recovery of the stock market, Illinois’ pensions continue to do worse and worse. Dan Proft: The public sector pension funds. Ted Dabrowski: The public sector pensions get worse despite this massive improvement in the stock market. Dan Proft: So I guess the argument would be made, wait a second, if Dan Proft with his financial guy can figure out where to put his money and how to distribute risk and how to have a balanced portfolio, then why can’t a Chicago police officer, Chicago firefighter, Chicago teacher do the same thing? They can do the same thing. I’m no smarter than they are. My financial advisors are no smarter than the financial advisors they could have access to. Ted Dabrowski: They make it so easy now to invest. You just call Charles Schwab, you call Fidelity, and they make it easy. I think that’s the whole thing, you know, public sector employees have gotten so in bed with the government, that they’re letting the government control their lives for them, including their retirement lives, and the government’s made a disaster of that, and people are scared that they may not have a retirement. We argue that the workers should have control; they should have that freedom to control their own retirement account. If they want the state to manage them, let them. But for those who want something different, give them the option; it’s only fair. Dan Proft: I want to go back to the Chicago public school system for a second, because we got a couple of things, a couple of chiblits that are always advanced by the Teachers’ Union, and their acolytes that need to be addressed. One is this idea the state’s not paying; it’s fair share the CPS, that’s the problem. Why don’t we just start there? Let’s do one at a time. So CPS receives a majority of its funding from the state, which is materially different than all the Collar County districts – well, most of the Collar County districts – and for the Collar County districts that it’s not materially different, that are majority funded by the state, they end up – districts like Matteson; low income – they end up subsidizing; so you have low income people in Matteson subsidizing people in Chicago. Ted Dabrowski: Well, let me just hit the first point. We’ve run the numbers, we’re going to be releasing them pretty soon. What Forest Claypool says, he’s using a logic that I don’t think makes sense, but let’s follow him with his logic; he says they have 20% of the students; they should get 20% of what the state doles out, to all the districts; and he says that that’s not true; well, we’ve run the numbers, and if you take the last ten years, including pensions, because he argues that Chicago public school district pays their own pensions, whereas the state pays the pension for all the other school districts; he says that’s unfair; and you could, at face value, agree with that; what Forest Claypool doesn't tell you is that the funding formulas for education more than make up for what the city looses on a pension, so bottom line is that we ran the numbers for the last 10 years; they’ve gotten more than their share every single year in the last 10 years, with the exception of this past year. They’ve gotten more on average than all the other school districts. So they’re getting their share, and I think we’re going to debunk his myth. He has to stop complaining that he needs a state bailout and start focusing on what reforms he can pass in Chicago. I think that’s where he really needs to focus on. Dan Proft: And so let’s just kind of again do this; like a little bit of classroom math – not common core style either, because I don’t know how to do math common core style – but the city of Chicago spends around 15 grand – a little bit north of that, but let’s use round numbers – 15 grand per kid per year. So classroom of 30 – keep it simple – that’s 450 grand per classroom in the city of Chicago; 650 schools, a little bit less than 400,000 kids like it normally used to be, because of the exodus from Chicago; so $450,000 per classroom; the teacher all-in cost the district $120k a year; let’s say you spend another 50 grand on supplies, because that’s 150. It’s a $1,700 per kid for the pension pick up, for the pension costs, so again, let’s round up to 2 grand; so that’s another 60 grand. So it gets me to 210; let’s say we throw another 50 in for the building of the infrastructure and all that – per kid – so that’s 260. Where’s the other 200 grand per classroom in Chicago go? Does anybody know? Because I asked Karen Lewis this question, I asked Forest Claypool this question, I asked aldermen in the city of Chicago this question. Nobody has the answer to this question. And the other thing that’s even more infuriating than not having the answer is nobody much seems to care. Ted Dabrowski: It kind of reminds me, after they closed the 50 schools and – I forgot who did the analysis – but they couldn’t find the computers, they couldn’t find a lot of the supplies, they were gone; and they can’t track themselves. I think the biggest issue was CPS, is that they’re too damn big, right? It’s a monolith, and they can’t manage themselves, and I think that’s the big issue. Dan Proft: So at the state-level or at the city-level, because the dynamics are very similar? Illinois Policy Institute, what’s a path forward? Everybody gets the benefits they’ve earned up to a date certain; what’s the path forward? What does that look in terms of retirement age? Pension contribution, all of the cost of living adjustments, all of the drivers for cost in the system? What should that look like, that is respectful and reasonable that we can potentially afford, that provides that balance? Ted Dabrowski: So let’s come back to that state university retirement system plan that’s a 401(k). That thing’s been around for 17 years. You’ve got about 1700-1800 workers and retirees in it. What that plan does, and the people who are on that 401(k) style plan, they don’t get social security, so the 401(k) style plan they get is robust enough to meet IRS standards, and to give a sufficient retirement. And what it does is the state puts in 7% into the 401(k) every paycheck, and the employee puts in 8%, so every paycheck period, 15% is going into their retirement account. And that’s been deemed good enough, and has been around for a long time, and many people get it. So we think that’s a good basis for creating a plan for all workers, new workers, and for benefits going for choosing some starting date; we think that would be a great start. You know, there could be debates on how to structure it, but we think that’s a really good start because going forward, what it would mean is that all the benefits that have been earned, any worker or retiree would continue to get… retirees wouldn’t be affected by this plan, but all workers would have earned their benefits up to a point, then going forward, everything goes into a 401(k) style plan. So it’s a fair plan, you respect retirement ages, you respect all that, and it does a lot to fix the problem in Illinois. We’ve run numbers and it depends on how strict we are with the terms, but we believe that we can cut the unfunded liability by 30-40%, which is pretty massive, and we can create a repayment plan on the rest of the debt that gets us out of this problem; in 30 years, but in one that there’s control and certainty, rather than the one we have today which is uncertain. Dan Proft: And to repeat just for emphasis, that means you’re not messing with the retirement age, you’re not messing with COLA's, or the other component parts of a person’s employment or retirement? Ted Dabrowski: Correct. I think what you want to do is leave what people have earned, because I think it’s all a question of constitutionality. Dan Proft: But even prospectively, even for the new hires today. Ted Dabrowski: Well the new hires today are looking for 401(k) plans. Dan Proft: Right, but you’re saying “Hey, if you have 30 years in and you’re 50, 55, 60, whatever, because you’ve got the 401(k), we’ve more or less achieved a solomonic balance of – we’re paying 7%, you’re paying 8%; you’re managing your funds; not defined benefit, it’s defined contribution like it exists in the private sectors, to the extent that even those exist in the private sector today – and everybody’s charting their own course. Ted Dabrowski: Right, and then from then on we just manage the debt that we have and the outstanding liabilities, but we don’t keep creating these unfunded liabilities which we’ve seen just keep growing every single year. They grow out of control. It’s like a mortgage that grows every year, rather than paying it down, it just keeps growing and growing, no matter how much you put in it. That would be the example of a home owner. You keep paying down your debt and it keeps getting bigger, and you can’t get control of it. Dan Proft: Right, and it would also obviate the need to make our mortgage payment with a credit card, which is essentially what we’re doing now, to the extent that we still get credit card companies that will issue us credit cards effectively, because at some point the bond markets are going to seize up and they’re going to disallow borrowing, except that usurious Soprano rates, like CPS just did. Ted Dabrowski: Here’s another point I wanted to make. So we talked about this 401(k) style plan already existing in Illinois; so it’s like some pipe dream we have; this is something that’s a legitimate plan that works, and if it’s good enough for our university professors, why isn’t it good enough for anybody else? But it’s not just Illinois that’s done this; we’ve had massive reforms across the country, and Michigan actually started this. In 1997 they moved all their employees to 401(k) style plans; back in 1997. Dan Proft: Michigan, big union state. Ted Dabrowski: Big union state, 1997, and so they got ahead of this long time ago. Let me give you another state that did a big change. They did a hybrid half, pension half 401(k) style plan, and that was Rhode Island. Democratically controlled legislature, they got it passed; big reform, very painful, but they did it. And Alaska has passed in 2006 a 401(k) style plan for new employees, and most recently Oklahoma passed one. So this is something that’s happening across the country. It’s not some dream, it’s happening. Dan Proft: So the question I’m sure a lot of people are thinking is “If it’s happening across the country and it’s working for 17,000 university professors who are not bitching about it – at least we don’t hear from them bitching about it – why haven’t we scaled it already?” Ted Dabrowski: Well, I think it’s been easy for Karen Lewis and others to say the rich aren’t paying enough. All we need are more taxes. And unfortunately, the union members have bought that argument. They’ve bough that argument that the taxes need to go up. There’s a solution, there’s a promise been made; don’t change what we got as a promise, no matter whether it’s 20 years into the future. Let’s just raise taxes to solve our problems, and at some point there’s going to be revolt. It’s not a big revolt, it’s a quiet revolt by people just leaving the state, leaving the city over and over again. Dan Proft: Isn’t that the problem? Again, it’s a political problem, but people leave the state; we essentially have a hollowing out in the city and the state. People that are insulated from bad public policy, the very rich and the very poor, that are beneficiary to the transfer payments, they don’t feel it, they don’t live in the world of trying to make ends meet, and so that’s what you’re left with, and frankly, that’s the constituency of the left. That’s the constituency of the established power structure in Chicago and the General Assembly. Ted Dabrowski: I think the big issue that’s going to continue to drive change are the property taxes. We’re seeing places, like you said, Matteson, and nearby - Southland – communities, where the tax rates on property, so the effective tax rate on a home is about 4-5% of the value. So if somebody would have tried to buy that house today would have to pay the cash for that home, they’d have to pay the value for that home, and within 20 years, because of taxes, they would have repaid for that home again. Dan Proft: So for most people with a 30 year mortgage, they pay for their home twice. What you’re saying is in Illinois and a lot of regions you’re going to pay for your house the third time because of the property taxes. Ted Dabrowski: Exactly, and that’s why people are starting to walk away from their homes in the Southland area. So you got a place where the manufacturing companies have gone. You see the big swaths of land just empty, and you’re starting to see now these nice big homes that have collapsed in value, and people walking away because they can’t afford it anymore. Between the mortgage and a second mortgage being the property taxes, they’re leaving. Dan Proft: And here’s something else I hear too, a lot of small and mid-sized businesses, 25 to 250 employees, they don’t make headlines when they leave, they don’t make headlines when they lay people off, they’re not big enough, but they’re impactful. They represent three quarters of the jobs in the state. They’re just quietly closing up shop, or they’re downsizing, and kind of methodically moving operations somewhere else. And it’s one of those things, like the old kind of sun also rises, how did you go bankrupt - gradually, then suddenly. So it’s kind of the whole thing, it’s like wait a second. Where did all the businesses in Elk Grove Village and the ring suburbs around O’Hare go? Well they slowly moved out over the course of the last ten years. Now how do you get them back? Ted Dabrowski: That’s really hard, and that’s why I always argue that… I talk a lot about the one reform that we can do tomorrow, and it can be agreed upon all the parties as new employees. Move to 401(k) style plans tomorrow. New employees don’t have a contract, they’re not protected by the Constitution, they would just enter with a new contract. Make it a reasonable, fair, 401(k) style plan. Then people would say “That wouldn’t save a whole lot of money”, but I’m saying “It may not save a whole lot of money, but that sure would send a different message than any message that we’ve sent over the last 25 years”; and that would send a message to the rating agencies, that reform is coming, that’d send a message to future employers, people that want to live in Illinois, but we’ve got to send a positive message, and right now there’s no positive message, and we know with the budget flight there’s no positive message. We need a positive message. Dan Proft: I want to level-up one level of education; the post secondary education in universities, we’ve talk about this cadre of university of professors in a 401(k) system, okay, but a lot of the discussion and the consternation in the context of this current state budget impasse is about universities, and they’re not receiving the funding they’ve become accustomed to from the state, and so there’s the prospect of laying off employees, and there’s a protest on campuses, state colleges, universities, and it’s all directed at the state of Illinois; what are they doing, they’re divesting from higher education. Well, it turns out, and this is some good work that’s been done by State Representative Mark Badneck - who’s a Freshman Republican from Oswego, Plainfield area - it turns out that if you do a little bit of comparison, in terms of what the state of Illinois provides in per pupil support, as compared to their conference peers – whether it’s Illinois State in the Missouri valley, or University of Illinois in the big 10 – it turns out we’re providing almost twice as much state support for pupil than the conference peers in other states, and yet tuition at our state schools is still 40% higher than their peers, their conference peers in those states. Explain that dynamic. Ted Dabrowski: Well, we looked at the numbers in higher education, and it’s easy to blame the lack of a budget right now. It’s easy to do that because it’s easy to point the finger at somebody. Dan Proft: That’s why they’re doing it. Ted Dabrowski: And that’s why they’re doing it, and of course, no budget has created a crack, sorry, is showing all the cracks that exist in higher-ed. But this problem has been building for 10 or 15 years or more, right, and a lot of it has to do with how much public funding is making it to education from the federal government and the state. And what these universities are doing is they’re taking all the available money they can find, and they’re hiring administrative staffs that are much too large, they’re bloated, and they’re paying massive salaries and massive pensions. And so when you look at what’s happening, it’s tuition's are having a double, not because education’s doing that much better; it’s all going to fund big, big administrations and super big pensions. Dan Proft: And we saw… we’re talking about the Chicago teachers’ strike in the not too distant past. How about the U of IC 1,100 professorate strike that was just two years ago – 2014. And they wanted to lift the floor for essentially part-time adjunct facility from 30 grand to 45 grand; 50% increase in base salary, and of course, that levels all the way up; we increase the floor here, and that increases the floor at every rung above that. And so how do we get out of that trap? Ted Dabrowski: It’s the same issues we’re talking. We’re talking pensions again. Dan Proft: Well, we’re talking salaries plus pensions. Ted Dabrowski: What happens is that these salaries are high and so what’s happened now is that when you take the state appropriations to go to education, higher-ed, they’ve actually grown a lot in the past decade. They’ve grown about 60% in the last decade; from 2.6 billion to over 4 billion. So it’s a big chunk of change; the problem has been is that 50% of all that money, 50% of what the state appropriates isn’t making it to higher-ed, it’s going to pay for pensions, and I was amazed when we did our work the other day, to find community colleges; community colleges pay their top person $500,000 a year. Dan Proft: You mean like the president of the university. Ted Dabrowski: The president, right. And of course, like you said, all those salaries get scaled up. Dan Proft: Tell us the story just for illustrative purposes, because it speaks to a larger cultural problem. In your research, the white paper that I read that you did in concert with colleagues at Illinois Policy Institute, a $900,000 administrator at the University of Illinois? Ted Dabrowski: Yeah, $900,000. Dan Proft: What the frack does that administrator do that warrants $900,000?! Ted Dabrowski: Included in that was a roughly $450,000 retention bonus after few years. Dan Proft: Okay, so what the frack does that administrator making 400 grand do that warrants a $450,000 retention bonus? Ted Dabrowski: Exactly. That person will probably get somewhere in the range of who knows, 8 to 9 to 10 million dollars in pensions. Think about that money, how many kids, how many scholarships that would fund in a given year for kids that tend Chicago State; that one person. Dan Proft: But they don’t hear, I mean you may hear it incredulously, but you’re going to hear it. Well, you want to attract and attain talents in academia, don’t you? Ted Dabrowski: So you can say that, now the question is, to how many people do you pay that? There’s a great study done by the Illinois General Auditor, and he looked at the number of administrators that these universities have, and it’s amazing. We looked at Chicago State… Dan Proft: This is like the Teldar Paper story, like all these vice-presidents, they just send memos back and forth; I can’t figure out what they do; this is the Michael Douglas moment? Ted Dabrowski: Well, nobody knows what they do, but they’re walking around through halls, but the point was, for Chicago State, they have one administrator for every 18 students. Dan Proft: Not one professor. Ted Dabrowski: No, they have one faculty member for every 16 students. So it’s almost the same number. Dan Proft: One administrator per every professor? Ted Dabrowski: Yes, so you could be sitting in a class, and your professor would be giving you a lesson, and there’d be an administrator right there watching over, making sure things are good. Dan Proft: A supervisor. Ted Dabrowski: You know, and again, a lot of that is because federal mandates, etcetera, but you can’t have that kind of bloat and not expect your tuition's to double, as they have in Chicago state, to the point where – here’s the sad part – the tuition's have gotten so high that you can’t have a kid who wants to work and go to school, because it’s just too expensive. And that’s why they’ve come to rely on scholarships. They’ve come to rely on free money because it’s no longer affordable. If these community colleges were meant for these kids to have an opportunity, why have we priced them out of touch? Dan Proft: So at the post-secondary educational level, where there’s community colleges, and we have some good community colleges, you know, 50 somewhat community colleges that provide… at least you can get your gen-ed requirements knocked out at a lower cost/credit hour at the community college before you go on to a four year university. But what you’re suggesting is that actually that’s not even the case anymore, and oh, by the way, because K-12 education, if so subpar, a lot of the costs at the freshman sophomore post-secondary education level is remediation, you’re paying for high school twice. I mean, if you talk to community college presidents, and university presidents, college presidents in the state, they’ll tell you the one in three kids that are going on at post-secondary education, I’m paying for them to do high school again for the first year, because they’re not prepared to do post-secondary work; so we’re paying for high school twice, and then we’re paying for administrators layered on to kids that are going to post-secondary education, not ready for the work, and then we wonder why the medieval poetry major can’t get a job when they get out of NIU, Illinois State, or U of I, or wherever, or Northwestern, for that matter. Ted Dabrowski: I think you’re capturing the problem really well, and what’s really scary is that not only can’t they get a job, but many of them have debt that they’ll never going to be able to repay, and that’s why you’re seeing these problems, right? You’re seeing trillions of dollars maybe becoming the next big problem in our country, with all this student debt the kids can’t pay back. A lot of it, again, bring it back around, a lot of it driven by pensions. Dan Proft: Fundamentally, if we’re thinking about K-12 education, and we’re thinking about higher education, with the bleak financial picture that we’ve painted, and the systems that have effectively been set up – let’s be just real honest about it – have effectively been set up to pay generous salaries and benefits to the adults in the system, not to educate children and to program for success in life. Ted Dabrowski: The Jerry Jones Program. Dan Proft: Clearly that’s not happening for the majority, then if there was one or two things where you could wave a magic wand at the Illinois Policy Institute and say this is the way to kind of a halt and do a 180, take a step back, and then chart a completely different course, what are those one or two things that get us off this path to ruin that we’re on, and onto a path of fulfilling the mission as stated of K-12 and post-secondary education? Ted Dabrowski: I think K-12 – I’m huge in empowering parents; I’m speaking generally, off course of some great public schools; and there’s people who are dedicated… Dan Proft: As there are at the post-secondary level. Ted Dabrowski: Listen, it’s not that people aren’t dedicated and they don’t care. I think systemically, and I think CPS, I’m sure there’s thousands of teachers and employees that care, I think the system is broken. The system – I’d say – is morally bankrupt. And it’s not going to work, and so until you get into a situation, and again, we’re seeing this happen again, same like we talked about 401(k)s, we’re seeing the same thing for school choice plans. Parents should be given the choice over where their kids go to school, and that’s one super empowering for parents who feel like they’ve been just totally left out of this, and that they think that more money is the solution, rather than being given a choice and control over their children’s education. So I think that’s number one. And we just saw Nevada, all of its 500,000 public school students have been given the choice of a voucher up to that $5,000; all of them. It’s amazing, state-wide, amazing. There’s now 26 states that offer school choice. Why isn’t Illinois one of them? Why isn’t Chicago one of them? Dan Proft: So that’s K-12 at the university level the problem is choice, right? Because Illinois, all the auto makers in the 70's have been insulated from competition, and kids are taking their GI bill, their Pell Grant, their stafford loan money, and they’re not going to school in Illinois. Ted Dabrowski: Right, they’re going outside, and they’re not coming back, and I think that higher-ed is a bigger problem, because it’s also a federal piece to it. You’ve got all that federal money, the schools know it, the schools know that the kids can borrow, and so therefore they raise their tuition and their hiring their jobs program to match that. So I think we need to stop a lot of what’s been happening there, and that would allow the cost come down dramatically; if we didn’t have all these subsidies feeding the cost up; but until we do that, I think it’s going to be tough. With that said, there’s a lot that can be done locally, because we don’t have to pay the salaries that we pay, and 2, we don’t have to have the administrative bloat that we have; and we certainly don’t need to have the pensions that we have. There’s no reason why people are getting 7 and 8 and 10 and 12 million dollar pensions. Dan Proft: So other than scaling the 1,700, go back to the 1,700 person university professors in a 401(k) style program, would you say that the state should starve the beast of academia? And force them to make changes that they’re otherwise not inclined to make, as long as you keep the spigot open? Ted Dabrowski: Well, sadly, that’s what’s happening, right? And it shouldn’t be that way; you’ve got a lot of people in pain now. You’ve got kids who thought they had a scholarship, now they don’t. They don’t care about those problems; then they had to have a plan. You’ve got teachers, professors who thought they had a job; they may lose them. And the way it’s happening now it shouldn’t be happening. It should be the administrations taking control of what they do and running an efficient system, but they’ve never been forced to do it, and Governor Rauner and the budget impasse is making them do that. They don’t like it, they don’t like having a gun to their head, but it’s forcing them to look at their costs, and it’s how it may happen. Dan Proft: So effectively, I mean, this K-12 or university, the common denominator is you have to have families be the accountability mechanism to how their tax dollars are being spent for the experience of their children, they have to be an accountability mechanism for their own local K-12 schools, they have to be an accountability mechanism for the universities they send their kids, for those kids to go onto post-secondary education. Ted Dabrowski: That’s absolutely right, and it’s interesting when you think about Chicago, and this comes back again empowering parents, families, the residents. Not the bureaucrats. When you look at the Laquan McDonald case, right, and you’ve got a Chicago, a police force and or mayor, or a attorney general who can hide information from the public for more than a year. When you have a situation where a school district can strike two times in a row on families; when you have a police force, when you try to take the problems of a Jason Van Dyke and discipline him – the police officer that shot Laquan McDonald, but you can’t use his old history of complaints, there’s a lot of things that the public is not seeing, and they seeded that too much of their power is residence to the Government, and a lot of what we’re talking about today is giving the power back to the residents. Give it back to the families, at least give it back to the people. Dan Proft: He is Ted Dabrowski, he’s the Vice- President of Policy at the Illinois Policy Institute. Nobody does more numbers, reality based research on these intractable problems in terms of the quality of public education in the state from pre-k through post-secondary than Ted and his team at the Illinois Policy Institute. You should read their stuff religiously so you’re empowered with the information they have researched and called to be that accountability mechanism that we’re talking about. Pleased to have Ted Dabrowski, Vice- President of Policy from the Illinois Policy Institute on this edition of Against The Current. Thank you for joining us, Ted, thank you. Ted Dabrowski: Dan, I appreciate it.

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