Rich Daley's Kind Of Town

Life is good in Chicago--and that's good for the mayor

The warm-up speakers--ministers and community activists--whipped up the crowd packed into an inner-city YMCA with talk of an economic rebirth. It was the main attraction, though, who really struck a chord with the largely African-American audience on Chicago's South Side--a part of town pock-marked with litter-strewn lots where white pols rarely venture.

Mayor Richard M. Daley rattled off a string of city-sponsored projects, but the crowd gave its warmest reception to his finger-jabbing promise to reconstruct the city's education system. "I can build all the buildings you want here, but if I can't provide a high school graduate with an education to get a job, I've failed," the mayor thundered.

Certainly, Daley's visit to the Woodlawn community just days before the Feb. 23 primary (the de facto election) could be seen as simple electioneering. His opponent, former Black Panther founder and four-term Democratic Representative Bobby Rush, 52, has a strong reservoir of support among the city's black community. But those who have watched Daley, 56, during his three terms see a street-smart, populist pol who seems genuinely determined to transform "the city that works"--as Chicago was called under the reign of his father, Hizzoner Richard J. Daley--into one that works for all the people.

A visitor to Chicago today finds a flurry of new hotels and retail construction stretching off Michigan Avenue's "Magnificent Mile." Thanks to $5.2 billion in public and private spending over the past decade, life is returning to ragged parks and beaten-down communities. Not everywhere, and not evenly, to be sure. And Rush has scored points with impassioned claims that "there are two Chicagos," where the poor and jobless "are not even on the radar screen as far as the power structure is concerned." But to Woodlawn community activist Yanier Moore, "Daley seems the better choice. He's helping the schools, he's kind of tough on crime, and he's better on the issues."

Polls suggest that Daley is likely to cruise to an easy victory. That would further highlight his groundbreaking education reforms and bring him additional clout in Washington. Ties between the mayor, a key network of influential power brokers, and the White House run deep--beginning, of course, with his brother, Commerce Secretary William M. Daley. Most important is the mayor's long-standing connection to Vice-President Al Gore. "He's incredible," says Gore. "You have to say he is one of the...most effective mayors in the country. If I were a citizen of Chicago, I would vote for him."

Of course he would. Another Daley term is crucial to Gore's hopes for capturing Illinois in the 2000 primary and general election. And what does Daley expect in return? He could use help in his crusade to crack down on the sale of handguns. In November, Chicago filed a $433 million suit against handgun manufacturers and scores of suburban gun dealers, who, Daley argues, are flooding the city with illegal weapons. He needs more federal funding for affordable housing and for ailing mass transit. Above all, he's after more school aid for his cherished educational overhaul. "We want an understanding of our problems," says Daley, a harsh critic of Washington. "Many times, they don't understand what's going on in America. It's that Beltway mentality."

MISSION IMPOSSIBLE. The plain-spoken Daley, who jots down notes about potholes and abandoned buildings as he's being driven through town, has never appeared to harbor any ambitions beyond the Second City. "He could have been governor or senator, but he genuinely likes being mayor," says Chicago lawyer and former Illinois Attorney General Neil F. Hartigan. In recent years, Daley has weathered scandals in the fire and police departments and major ethical lapses among some of his closest political aides--front-page stories reminiscent of the old Chicago. But Daley himself has not been tarnished, and he is likely to be best remembered for doing what many inside and outside the city thought was close to impossible: turning around a broken-down, corruption-riddled, big-city school system.

In 1995, after the state legislature handed control of the school system to the mayor, Daley swiftly made two key decisions: He sent his chief of staff, Gery J. Chico, to head the Board of Education, and he made his hyperkinetic budget director, Paul Vallas, CEO of the school system. They moved immediately to eliminate a $1.3 billion budget deficit, regain investor confidence, and issue $2 billion in bonds for capital improvements. They also managed to secure labor peace with a long-term teacher contract.

But progress in reading and math scores, dropout rates, and graduation rates wouldn't have materialized without a tough-love program. Perhaps most important was the controversial decision to end "social promotion"--the routine passing of kids from elementary to middle school and from there to high school regardless of performance. To help youngsters who are held back, the school board began offering a battery of special classes, summer school, and tutoring--efforts hailed by President Clinton in his State of the Union address as a model for the country.

JOB MIGRATION. Still, there's no question that the schools have far to go. "You have to be sober about this," concedes Vallas, who notes that the bulk of elementary and high school students are reading and computing well below national norms. "But high standards and high expectations have gotten everybody to work harder." And the school system's progress is turning the heads of some early skeptics. "The business community loves this administration," says John Ayers, executive director of the Leadership for Quality Education, a business-backed education-reform group, "but we're only a quarter of the way there."

While schools are Daley's highest priority, he also has been grappling with a steady loss of jobs, especially industrial ones, to the suburbs. For now, it looks as though the exodus may be ending, thanks in large part to the clever and extensive use of an economic tool called tax increment financing (TIF). In 67 TIFs, Daley is, in essence, partnering with private enterprise to provide infrastructure and direct grants in return for new businesses, jobs, and homes. On abandoned industrial land known as Goose Island on the city's North Side, Daley boasts of creating 5,000 new jobs at companies from Federal Express Corp. to Sara Lee. On a former illegal waste dump on the heavily blighted West Side, Daley persuaded Don Jackson, CEO of Central City Productions Inc., to build a 400-employee, $150 million studio to produce television programming aimed at African Americans. Some $25 million in city support, primarily loans, helped Jackson make his decision.

Rush and other critics claim that the development schemes have favored developers friendly with the mayor. They also gripe that small businesses and longtime homeowners are being pushed out of newly gentrifying areas. Daniel Immergluck, vice-president of the Woodstock Institute, an economic think tank, questions whether all the tax breaks have been necessary. "A lot of the development in the TIFs would have happened anyway because of the strong regional economy," he says.

Daley is unapologetic, and irrepressible, rolling out a never-ending stream of proposals. To blunt attacks that his new housing development plans in run-down areas will create pressures on existing homeowners, he gained City Council approval in early February for low-cost loan packages of $10,000 to $18,000 to assist South Side residents in upgrading their homes. That same week, he unveiled a high-tech business-development strategy, marshaling $10 million in tax subsidies and investments from city pension funds to provide seed capital and to purchase a Loop building to house startups.

For all of Daley's progress, there are fractious debates ahead. He's at odds with Governor George Ryan--and Rush--over nascent plans for a third airport outside the city and Daley's control. A new Daley term will coincide with the return of public-housing control to the city--seized by the feds in 1995--and the challenge of replacing at least 11,000 high-rise apartments that are being leveled.

What's more, the number of big corporate headquarters in Chicago is declining. And the health of the big futures exchanges, which employ 150,000 people directly or indirectly, is also becoming increasingly worrisome as electronic trading spreads. Daley puts it down to the ebb and flow of jobs and business. "How do you stop it? We'll get new CEOs and entrepreneurs," he says. And he probably will. If Daley can make the city work for everyone, almost anything seems possible.

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