BULLS MARKETS:

POWER, PLACE, AND PROFESSIONAL SPORT

IN LATE TWENTIETH-CENTURY CHICAGO

BY

SEAN DINCES

B.S., UNITED STATES NAVAL ACADEMY, 2004

A.M., UNIVERSITY OF CALIFORNIA AT SAN DIEGO, 2006

A.M., BROWN UNIVERSITY, 2013

A DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT OF THE

REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY IN THE

DEPARTMENT OF AMERICAN STUDIES AT BROWN UNIVERSITY

PROVIDENCE, RHODE ISLAND

MAY 2014

© Copyright 2014 by Sean Dinces

This dissertation by Sean Dinces is accepted in its present form

by the Department of American Studies as satisfying the

dissertation requirement for the degree of Doctor of Philosophy.

Date ______Elliott J. Gorn, Advisor

Recommended to the Graduate Council

Date ______Larry Bennett, Reader

Date ______John R. Logan, Reader

Date ______Robert O. Self, Reader

Approved by the Graduate Council

Date ______Peter M. Weber, Dean of the Graduate School

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Curriculum Vitae

Sean Dinces was born on June 11, 1982 in Corona, California. He received his

B.S. in History from the U.S. Naval Academy in Annapolis, Maryland in 2004. He earned an M.A. in History in 2006 from the University of California at San Diego. He matriculated to Brown in 2008 to begin doctoral work in the Ph.D. program in American

Studies. In May 2013, he received his M.A. in Urban Education Policy from Brown as part of the first cohort of Open Graduate Education students. His dissertation research was funded by two year-long Brown University Graduate School fellowships, as well as by supplementary funding from the Open Graduate Education Program. From Summer

2012 – Summer 2013, he served as a graduate research intern for the Quest Center at the

Chicago Teachers Union. While at Brown, he authored academic reviews for Academe, the Journal of Sport History, and Sport in Society, as well as academic articles for

Critical Sociology and the International Journal of the History of Sport.

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Acknowledgements

If this project is worth anything, it’s due first and foremost to the generosity of the mentors, colleagues, friends, and family who have put up with me for the past five years.

Elliott Gorn actually took enough time away from complaining about the Cubs to be a first-rate advisor. He saved me from many bad decisions, and his feedback helped my writing go from bad to mediocre. He has been exceedingly patient as both a professional mentor and friend throughout the dissertation process, from the moment he suggested the idea of writing about the Bulls. I also benefited tremendously from a dynamic and dedicated group of dissertation readers. Robert Self provided incredibly thoughtful advice on the conceptual framing of each chapter in addition to rigorous commentary on the strengths and weaknesses of my evidence. He has been a consistent role model as both a teacher and mentor, and my understanding of modern American history owes most to his lectures and seminars. Larry Bennett’s willingness to share his expertise in urban planning and the political history of Chicago proved invaluable as I tried to write about the city’s history as an outsider. I hope this dissertation continues the rich tradition of critical scholarship on Chicago of which his work is a centerpiece. Finally, John Logan not only provided me with a vibrant intellectual home in Brown’s institute for Spatial

Structures in the Social Sciences (S4), but also lent vital insights from the vantage point of urban sociology.

Several other faculty, staff members, and students at Brown supplied crucial intellectual and logistical support. As preliminary field advisors, Anne Fausto-Sterling and Anthony Bogues inspired me to ignore disciplinary boundaries. Sandy Zipp, Naoko

Shibusawa, Catherine Lutz, Anne Valk, and Seth Rockman provided much-needed

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informal mentorship throughout my time as a PhD student, and Mari-Jo Buhle’s encouragement during my first year at Brown convinced me that I was in the right place.

Susan Smulyan, Robert Lee, Ralph Rodriguez, and Rich Meckel all made American

Studies a nourishing intellectual and professional home base. Faculty members in the

Sociology and Education departments graciously welcomed me—a lowly historian—into

their classrooms and offices. In particular, David Lindstrom, Leah VanWey, Kenneth

Wong, and John Papay all gave me the opportunity to explore new intellectual approaches and methodologies. I owe a special debt of gratitude to Margot Jackson, who not only answered far too many of my stats questions, but also generously shared her insights about life as a junior faculty member. And also to Rachel Franklin who, as

Associate Director of S4, fielded a steady barrage of queries about GIS and gave me repeated opportunities to share my work with other spatial researchers on campus. In addition, Pier Dominguez, Chris Elias, and all of the student participants in Brown’s

“Capital and Culture” Mellon Dissertation Completion Workshop offered crucial commentary on early iterations of this project. Finally, Jeff Cabral is the best department manager out there, even though he’s a Red Sox fan (we’re all human, after all). He truly was the man with all the answers; without him I never could have navigated the bureaucratic maze that is graduate school.

Many scholars and staff from other institutions nurtured my interest in history and urban studies, and several were kind enough to offer important feedback on this dissertation. David Peeler supported my pursuits in cultural history as an undergraduate at Annapolis, and Nayan Shah’s faith in my abilities brought me into a rich intellectual community at UCSD. Several conversations with Costas Spirou helped reassure me that

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there was much more to be written about the United Center. I owe a special thanks to

Robert Edelman at UCSD, who has been a staunch advocate, friend, and intellectual

sounding board for the entirety of the last decade. He showed me that sports history

deserved real attention, and has been behind me 100% since I arrived in San Diego in

2004. In addition, Wayne Wilson and the staff at the Amateur Athletic Foundation

Library in Los Angeles have been a godsend in terms of tracking down obscure source

material, as have the always-knowledgeable librarians and archivists at the Chicago

History Museum and Municipal Reference Collection at Harold Washington Library

Center. While it’s probably best that I don’t mention any of them by name, several people

at the offices of the Cook County Assessor, Cook County Board of Review, and Cook

County Clerk went out of their way to help me track down elusive data on the fiscal and

financial histories of the United Center.

This dissertation simply could not have been written without the support of a

phenomenal group of friends and colleagues in Chicago. Christopher Lamberti (the one-

man Adam Dunn fan club), Milena Sjekloca, Vijay Pendakur, Katie van Tiem, Elena

Gonzales, and Simon Goldbroch all opened their guestrooms and kitchens to me even

though they probably should have thought better of it. Ben Joravsky put his muckraking

on hold to help me navigate the labyrinth that is the Cook County property tax system,

and was a constant source of encouragement from start to finish. Carol Caref, Sarah

Hainds, Pavlyn Jankov, and Kurth Hilgendorf not only taught me the ins-and-outs of strategic labor research during my internship with the Chicago Teachers Union, but also gave me the opportunity to connect my dissertation research to the real world. Elliott

Mallen also generously shared his expertise in dealing with property tax appeals.

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I’m extremely grateful to those in Chicago and elsewhere who agreed to be interviewed for this dissertation, especially to Mark Weinberg, Bill Wilen, and Thom

Finerty, all of whom sat down for repeated follow-ups. Charlie Beyer, Walter Burnett, Jr.,

Earnest Gates, Annie Kostiner, Lewis Kostiner, and Ed Shurna also went out of their way to sit down with me and share their respective stories.

It’s a wonder that I have any friends left at this point; they all deserve a medal (or better yet, a tax break). The ones that have been with me since San Diego will always have a special place in my heart: a lot of love to Viviana MacManus, Tina Park, Yumi

Pak, Caralyn Bialo, Jodi Eisenberg, Gordan Chang, Jeff Lundy, Nicole Kuo, and Dixa

Ramirez. My Providence comrades have been an absolute godsend. The aforementioned

Chris Lamberti, Will Brucher, Wen Jin, Mercedes Lyson, Kevin Barry, Sara Matthiesen,

Lindsay Goss, Alma Carrillo, Oddný Helgadóttir, Cornel Ban, Malgorzata Rymsza-

Pawlowska, Sarah Seidman, Koji Masutani, Julie Pittman, Leah Nahmias, Heather Lee,

Maria Hwang, Katharine Joo, John Rosenberg, Elizabeth Searcy and Maria José Boccardi all left the glass seeming half full. Pier Dominguez, Majida Kargbo, Crystal Ngo, Colleen

Tripp, Horace Ballard, and Liz Wolfson made Am Studies an absolute joy—there’s not a better group around. Robyn Schroeder was the rock of my cohort, and I can’t forget to thank the graduate students in UEP (esp. Mike Katz, Gabe Santner, Mark Cruz, and Kate

Bubrick), S4 (esp. Tim Squires, Michael Zuher, and Weiwei Zhang), and the sociology department at Brown for taking so kindly to an interloper. I’m also truly thankful for the enduring friendship of Jake Steele, Laura McDonald, Scott McDonald, Tim Snow, Chad

Cleveland, Mike Holland, David Ahlers, Shefali Mistry, and Gintien Huang, as well as

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the professionalism and supportiveness of Constance Hiller, Pouneh Fazeli, and Billy

Brennan.

Oh yeah. Through thick and thin, Derek Seidman was present.

My biggest thanks are reserved for my parents, Lucy and Jerry, who have made this project possible in more ways than they know. Saner parents would have disowned me long ago. Either way, mom and dad, now you know what I’ve been doing for the past three years.

Last, but most definitely not least, a melancholy thanks to Tam Tran. We miss you, Tam.

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Table of Contents

Introduction ...... 1

Chapter One- Bullish on Image: Basketball and Urban Branding in the “New Chicago” ...... 16

Chapter Two- “Normally, Heroes Cost You Money”: Consumption, Class, and the Bulls ...... 90

Chapter Three- The Bulls as “Good Business”: The United Center and the Struggle Over “Redevelopment” on Chicago’s Near West Side...... 151

Chapter Four- “Anchor” or Shipwreck?: The United Center as Urban Development Flop……………………………………………………………………………………..223

Chapter Five- A Bad Case of “Peanuts Envy”: Concessions Markets and Monopoly Power at the United Center ...... 297

Chapter Six- “Nothing But Net Profits”: Fiscal Policy and the Socialization of Risk at the United Center ...... 344

Conclusion ...... 412

Appendix A- Logistic Regression Analysis of 1993 General Social Survey Data on Sporting Event Attendance ...... 417

Appendix B- The Cook County Property Tax System and United Center Savings Estimates ...... 428

Appendix C- United Center Amusement Tax Savings ...... 440

Bibliography ...... 441

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List of Tables

Table 1.1. Selected Employment and Population Statistics, City of Chicago, 1950-1990………………………………………………………………..22

Table 1.2. Selected Postwar Economic Indicators in Twenty Most Populous U.S. Cities/Metro Areas……………………………………………………….28

Table 1.3. Downtown Population Change, Major Midwestern Cities, 1980-2000….44

Table 1.4. Number of Employees in Selected Industries, Chicago City, 1991, 1997 & 2001………………………………………………………………………44

Table 1.5. Estimated Combined Festival Attendance, Chicago City, 1993-1999…..61

Table 1.6. Establishments in Select Service Industries Chicago City, 1991, 1997 & 2001………………………………………………………………………63

Table 1.7. Employees in Select Service Industries, Chicago City, 1991, 1997 & 2001………………………………………………………………………63

Table 1.8. Annual Average Unemployment Estimates by Race, Chicago City, 1997-2000………………………………………………………………..78

Table 2.1. Income Levels of Consumers by Attendance at Sporting Events, 1994……………………………………………………………………..115

Table 2.2. Venue-Related Revenues for the Chicago Bulls and Chicago Blackhawks, 1992-96.………………………………………………………………...123

Table 2.3. Team Marketing Report “Frugal Fan Index,” 1995/96-1998/99……….128

Table 3.1. Selected Demographic Data for Chicago’s Near West Side Community Area, 1940-90…………………………………………………………..160

Table 3.2. Stipulations of the 13-Point Agreement Between Interfaith Organizing Project and Metro Chicago Stadium Joint Venture…………………….177

Table 3.3. Distribution of Funds Via the13-Point Agreement Signed in May 1991……………………………………………………………………..192

Table 4.1. Direct Neighborhood Investment by United Center Ownership………..231

Table 4.2. Public Investment in Support of United Center………………………...234

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Table 4.3. Selected statistics from von Hoffman’s House by House, Block by Block……………………………………………………………………237

Table 4.4. Number of Public Housing Residents at CHA Developments in West Haven…………………………………………………………………...255

Table 6.1. “Reported Public Share” of Stadium Financing, 1970-1994…………...354

Table 6.2. “Adjusted Public Share” of Financing for MLB and NBA Facilities in Use as of 2010……………………………………………………………….357

Table 6.3. Percentage Change in Aggregate Property Tax Rate, Cook County, 1981- 1994……………………………………………………………………..381

Table 6.4. Effective Property Tax Rates, City of Chicago, Tax Years 1991-2009………………………………………………………………381

Table A.A.1. Weighted Descriptive Statistics for General Social Survey Sample…...420

Table A.A.2. Regression of Probability of Having Attended a Sporting Event in the Previous Year on Individual- and Household-Level Variables………...425

Table A.B.1. Net Income Adjustments for United Center, Fiscal Years 1996-2010…431

Table A.B.2. Estimated United Center Tax Liabilities Using Actual Net Income, 38% Assessment Level (25% for Tax Years Post-2008), and Net Income Multiplier of 4, Tax Years 1997-2011………………………………….435

Table A.B.3. Estimated United Center Tax Liabilities Using Actual Net Income, 38% Assessment Level (25% for Tax Years Post-2008), and Net Income Multiplier of 8, Tax Years 1997-2011………………………………….435

Table A.B.4. Difference between Standard/Counterfactual Tax Liabilities (Net Income Multiplier = 4) and Actual Tax Payments for the United Center for Tax Years 1997-2011………………………………………………………..436

Table A.B.5. Difference between Standard/Counterfactual Tax Liabilities (Net Income Multiplier = 8) and Actual Tax Payments for the United Center for Tax Years 1997-2011………………………………………………………..437

Table A.C.1. United Center City Amusement Tax Savings (Suites Only), Fiscal Years 2002-2007………………………………………………………………440

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List of Figures

Figure I.1. Bulls Fans Gather Outside Chicago Stadium to Watch Game 5 of the 1991 NBA Finals………………………………………………………….2

Figure 1.1. Manufacturing Establishments and Employees in Chicago City, 1972-1992………………………………………………………………..29

Figure 1.2. Total Personal Income Growth, Selected Metropolitan Statistical Areas, 1969-1979………………………………………………………………..30

Figure 1.3. Industry Share of Total Full-Time and Part-Time Non-Farm Employment, Chicago-Joliet-Naperville (IL-IN-WI) Metropolitan Statistical Area…...39

Figure 1.4. Number of Prisoners in State/Federal Prison by Race, Illinois, 1990-1998………………………………………………………………..79

Figure 2.1. Two Chicagoans High-Five as Bulls Fans Congregate in Grant Park to Celebrate the Teams’ First NBA Championship in 1991.……………….97

Figure 2.2. Reponses by Race to February 1997 ABC News Nightline Poll Question: “Do you think that the presence of Whites, Blacks and other minorities on sports teams helps, hurts, or has no effect on integration and reduction of racial tension in other areas of life?”…………………………………...100

Figure 2.3. David Hobart, 8, From the Grand Boulevard Neighborhood on Chicago’s South Side, Perches on a Friend’s Back in Order to Catch a Glimpse of the Bulls in Grant Park, 1996……………………………………………….103

Figure 2.4. Real Cost of Most Expensive (Courtside) and Least Expensive (Second Balcony) Seats for the Bulls, 1970/71-1993/94……...…………………108

Figure 2.5. Average Ticket Prices, Chicago Bulls and Rest of the National Basketball Association, 1991/92-2001/02………………………………………….113

Figure 2.6. Predicted Probabilities of Attendance at an Amateur or Professional Sporting Event in 1992 as Function of Family Income………………...117

Figure 2.7. Predicted Probabilities of Attendance at an Amateur or Professional Sporting Event in 1992 as Function of Years of Education…………….118

Figure 2.8. Average Player Salaries, National Basketball Association, 1979/80-2001/02………………………………………………………..132

Figure 2.9. Aggregated Core Financial Data, National Basketball Association Franchises, 1990/91-2000/01…………………………………………...134

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Figure 2.10. Operating Margins of the Chicago Bulls and Rest of NBA, 1990/91-2000/01………………………………………………………..135

Figure 2.11. Chicago Bulls Core Financial Data, 1990/91-2000/01…………………136

Figure 2.12. Percent Change in Real Hourly Wage by Selected Percentile, 1973- 1995……………………………………………………………………..142

Figure 2.13. Average Annual Consumer Unit Expenditures on “Entertainment Fees and Admissions” by Pre-tax Income Quintile, 1984-2011………………….143

Figure 3.1. Image from an IOP Organizing Flyer…………………………………..165

Figure 3.2. “Redevelopment Yes. Westside Stadium No.” Anti-Stadium Organizers Protest Outside the Old Chicago Stadium in Opposition to the Bears Stadium Proposal……………………………………………………….165

Figure 3.3.A. Detail from the Land survey Done by the IOP for The Better Alternative Plan……………………………………………………………………..178

Figure 3.3.B. Detail from the Ideal Land-Use Plan Proposed by the IOP in The Better Alternative Plan………………………………………………………...179

Figure 4.1. New Home Purchase Loans in West Haven, 1995-2005……………….264

Figure 4.2. Detail from Official Chicago Department of Planning Map Showing United Center’s Interference with Pedestrian Traffic in West Haven….286

Figure 4.3. Vacant, Unused Land in West Haven, the West Loop, and East Garfield Park, 1991-2005………………………………………………………...292

Figure 5.1. Mr. Peanut Gets the Boot from the United Center……………………...308

Figure 5.2. Price for Typical Family Basket of Concessions at a Chicago Bulls Game, 1991-1999………………………………………………………………330

Figure 6.1. United Center’s Actual Property Tax Payments vs. Counterfactual Property Tax Liabilities under Standard Assessment Procedure for Tax Years 1997-2011………………………………………………………..362

Figure 6.2. United Center Net Income (Profits) and Actual Property Tax Payments for Tax Years 1997-2011…………………………………………………...364

Figure 6.3. Wrigley Field Tax Payments for Tax Years 1990-2009………………..366

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List of Maps

Map 1.1. Blacks as Percentage of Total Population by Census Tract, Chicago, 1990………………………………………………………………………73

Map 1.2. Family Poverty Rate by Census Tract, Chicago, 1990…………………..74

Map 2.1. Geography of Celebration for Chicago Bulls Fans………………………94

Map 3.1. City of Chicago Community Areas by Ethnic/Racial Composition, 1990……………………………………………………………………..157

Map 3.2. The “Better Alternative Area” According to Planning Documents from the Interfaith Organizing Project…………………………………………...158

Map 3.3. Absolute Population Change by Census Tract, Near West Side and Surrounding Community Areas, 1980-1990……………………………162

Map 3.4. African-Americans as Percentage of Total Population by Census Tract, Near West Side and Surrounding Community Areas, 1990……………163

Map 3.5. Neighborhood Geography of the Near West Side Community Area…..168

Map 3.6. Neighborhood in and Around the Better Alternative Area, Post-United Center Development……………………………………………………200

Map 4.1. Census Tract Geography in West Haven and Nearby Neighborhoods…243

Map 4.2. Land Use in West Haven as of 1990……………………………………244

Map 4.3.(s)* African-Americans as Percentage of Total Population, 1990-2010……247

Map 4.4.(s) Change in Absolute White (Non-Hispanic) Population, 1990-2010..….248

Map 4.5.(s) Change in Absolute African-American Population, 1980-2010………..252

Map 4.6. Change in Absolute African-American Population, West Haven Tracts, 1990-2000………………………………………………………………255

Map 4.7. Permits Issued for New Construction by the City of Chicago, Near West Side and Loop, 1987-1990……………………………………………...273

Map 4.8. Sites of New Construction of Renovation Noted in Local Media and Real Estate Publications, Northern Half of Near West Side, 1983-1990…….274

* (s) indicates map “series.” xv

Map 4.9. Building Permits Issued for New Construction and Renovation, West Haven and West Loop, January 2008 - August 2013…………………..277

Map 4.10.(s) Land Use in West Haven Tracts, 1990-2005………………………...…291

Map 5.1. Selected Anti-Peddling Ordinances on Chicago’s North Side Passed During the 1990s………………………………………………………..332

Map 5.2. Geography of the Anti-Vendor Ordinance and United Center Parking………………………………………………………………….337

Map 6.1. Property Tax Savings by Parcel for United Center, Tax Year 2006……393

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Introduction

In Los Angeles on the night of June 12, 1991, behind stellar performances by

Michael Jordan and Scottie Pippen, the Chicago Bulls bested the Lakers to clinch their

first ever National Basketball Association (NBA) title. The day after the victory, the

Chicago Tribune foreshadowed the Bulls’ emergence as a legitimate sports dynasty when

it asserted that, by beating the Lakers, they “became the team of the 90s.”1 Indeed, by

1998 Jordan and Pippen had amassed six NBA championships, and Jordan in particular had established himself as one of the most worshipped athletes of the twentieth century.

The night of that first championship win on the road in Los Angeles, a handful of

Bulls fans gathered in an empty parking lot outside Chicago Stadium, the arena on

Chicago’s Near West Side where the Bulls played their home games until moving to the

United Center (just across the street) in 1994. Adorned in Bulls hats and jerseys, they stationed themselves around the hood of a truck with a television set mounted on top, and cheered on their team. The photograph of the scene which appeared in the Chicago

Tribune (see Figure I.1) offers a subtle, yet important insight about the production and consumption of professional sport at the end of the twentieth century. On the one hand, the fans’ exhilarated reaction to the television reinforces the importance of globalized mass media in the growing popularity and profitability of leagues like the NBA and teams like the Bulls during the 1990s. On the other, the imposing outline of Chicago

Stadium in the background reminds us that these teams were—and continue to be— firmly anchored in specific places.

1 Sam Smith, “Bulls Stampede to First Title,” Chicago Tribune, June 13, 1991, ProQuest. 1

Figure I.1. Bulls Fans Gather Outside Chicago Stadium to Watch Game 5 of the 1991 NBA Finals. Source: Fryer (1991).Color image retrieved from Chicago Tribune Photo Archive, http://www.tribunephotos.com/.

Sports studies scholars have spilled a lot of ink debating the historical significance of Jordan and the Bulls, but their offerings on the subject usually deal with the mass media context, rather than the place-specific history of the team. This is understandable, since perhaps more than any professional athlete, Michael Jordan demonstrated how mass-mediated athletic celebrity could generate unprecedented revenues for the global sports and media industries, and embodied certain ideologies, such as “post-racism,” that became increasingly dominant in the U.S. during the nineties.2 While highly informative,

2 On Jordan’s relevance as an athletic celebrity and cultural symbol, see David Andrews, “Deconstructing Michael Jordan: Reconstructing Postindustrial America,” Sociology of Sport Journal 13, no. 4 (1996): 315- 318; David Andrews, ed., Michael Jordan, Inc.: Corporate Sport, Media Culture, and Late Modern America (Albany, NY: SUNY Press, 2001); E.G. Armstrong, “The Commodified 23, or, Michael Jordan as Text,” Sociology of Sport Journal 13, no. 4 (1996): 325-343; Cheryl Cole, “American Jordan: Play, Consensus, and Punishment,” Sociology of Sport Journal 13, no. 4 (1996): 366-397; Norman Denzin, “More Rare Air: Michael Jordan on Michael Jordan,” Sociology of Sport Journal 13, no. 4 (1996): 319- 324; Michael Eric Dyson, “Be Like Mike?: Michael Jordan and the Pedagogy of Desire,” Cultural Studies 2

existing work on the subject papers over the fact that the production of Jordan and the

Bulls was also a local story about the economic and political transformation of Chicago at the end of the twentieth century. All within the span of a decade, the Bulls became a pillar of the city’s effort to re-brand itself as a postindustrial leisure Mecca for tourists and young professionals, Bulls games emerged as the favorite hangout of local elites,

team ownership built a new arena—the United Center—which allegedly anchored the

revitalization of the Near West Side, and independent peanut vendors fought the owners

in court over the right to compete for concessions sales on the sidewalks surrounding the

new arena.

Using the urban, place-specific history of the Bulls as a case study, I argue that

sports franchises in this era both shaped and capitalized on changes in the structure of

urban growth in ways that went beyond well-publicized stories of taxpayers funding new

sports facilities. While the chapters that follow confirm the cynicism of economists and

policy experts about the use of public money to support sports-linked urban development,

they also suggests that, by zooming in on much-discussed controversies over public

funding of stadiums, existing scholarship on the urban political economy of the sports

business has overlooked key relationships and historical processes undergirding the

contemporary power and profitability of teams like the Bulls.

7, no. 1 (1993): 64-72; Jerry Hausman and Gregory Leonard, “Superstars in the National Basketball Association: Economic Value and Policy,” Journal of Labor Economics 15, no. 4 (October 1997): 586-624; Steven Jackson, David Andrews, and Cheryl Cole, “Race, Nation and Authenticity of Identity: Interrogating the ‘Everywhere’ Man (Michael Jordan) and the ‘Nowhere’ Man (Ben Johnson),” Immigrants and Minorities 17, no. 1 (1998): 82-102; Walter LaFeber, Michael Jordan and the New Global Capitalism (New York, NY: W.W. Norton, 2002); Douglas Kellner, “Sports, Media Culture, and Race: Some Reflections on Michael Jordan,” Sociology of Sport Journal 13, no. 4 (1996): 458-467; M.G. McDonald, “Michael Jordan’s Family Values: Marketing, Meaning and Post-Reagan America,” Sociology of Sport Journal 13, no. 4 (1996): 344-365. 3

I explore these processes and relationships in three parts. The first part uncovers

how the Bulls both encouraged and profited from efforts by local pro-growth institutions

to reinvent Chicago by marketing it as a “city of leisure.”3 The team initially became a

prized asset among Chicago media outlets and other components of the local growth coalition not because of its role in local stadium development, but rather as a result of its purported value as an urban “brand.” When the owners did eventually open a new

stadium in 1994, its profitability depended first and foremost on the emerging market of

moneyed Chicagoans who embraced professional basketball as a centerpiece of the city’s

new cultural and entertainment infrastructure. The second part delves into the political

and planning histories of the United Center, which quickly became a nationally heralded

example of how public-private partnerships could allegedly work in the interests of both

growth-minded developers and residents in poor central city neighborhoods. However, a

closer look reveals not only that this narrative obscures how the arena developers ultimately abetted efforts by certain local leaders to marginalize nearby public housing residents, but also the lack of any systematic evidence that the arena has spurred ancillary economic development. The final part of the dissertation deals with little-known strategies used by team ownership to insulate investment in the United Center from risk through the co-optation of local government institutions. It suggests that, contrary to the existing academic consensus, the Bulls’ success in doing so had much more to do with broad structural changes in the relationship between capital and government than with special monopoly powers wielded by the professional sports business.

3 Costas Spirou, Urban Tourism, Urban Change: Cities in a Global Economy (New York, NY: Routledge, 2011), 55. 4

Before going into further detail on the plan of the dissertation, it’s worth

speculating as to why this story has yet to be told. Historians of the United States don’t

write very much about the urban history of sport, at least not anymore. For a brief

moment during the 1980s and early 1990s, however, this wasn’t the case. Sports

historians like Melvin Adelman, Steven Riess, and Stephen Hardy situated the production

and consumption of sport in the late-nineteenth and early-twentieth centuries not simply

as reflections of larger social and cultural trends, but as important motors behind

processes like immigrant assimilation, formation of community identity, and the

expansion of modern urban consumption.4 But even though sport remained a fixture of

the American city in the postwar period in the form of massive stadium developments,

new spaces for consuming games and other sports-related products, as well as mass participation in recreational sports, historians have shown little interest in the role of sport

in city-building during the second half of the twentieth century. This has been especially

true in reference to the recent urban history of the professional sports business;

economists and policy scholars have written extensively on the subject, but not historians.

Some urban historians have lumped central city stadium development since 1980 into

what Jon Teaford describes as the “recentering of metropolitan America,” but more often

than not they mention the sports business only in passing, if at all.5

That the study of sport in the American city failed to catch on as a historical

subfield probably has to do with several recent trends in humanities and social science

4 See Melvin Adelman, A Sporting Time: New York City and the Rise of Modern Athletics, 1820-1870 (Urbana, IL: University of Illinois, 1986); Stephen Hardy, How Boston Played: Sport, Recreation, and Community,1865-1915 (Boston, MA: Northeastern University Press, 1982); Steven Riess, City Games: The Evolution of American Urban Society and the Rise of Sports (Urbana, IL: University of Illinois, 1989); and Rob Ruck, Sandlot Seasons: Sport in Black Pittsburgh (Urbana, IL: University of Illinois, 1993).

5 Jon Teaford, The Metropolitan Revolution: The Rise of Post-Urban America (New York, NY: Columbia Univeristy Press, 2006), 254. 5

scholarship. In the first place, the much-discussed “cultural turn” in disciplines such as history legitimated new ways of studying sport that often (but not always) pushed political and economic processes grounded squarely in place to the background in order to foreground issues falling under broad topical umbrellas like “representation,”

“identity,” “discourse,” and more recently “affect.”6 As even a cursory review of recent dissertation surveys by the Journal of Sport History makes clear, contemporary research in the field is much more likely to focus on subjects like racial formation, gender identity, and media coverage than on the role of sport in the American urban experience, let alone in the recent history of urban growth and development.7

Another likely reason for the seeming lack of interest in the urban history of sport is the justifiable inclination of many sport historians to move beyond studies grounded in a single place in order to grapple with questions about how American sport evolved as a global or transnational phenomenon. For example, scholars like Barbara Keys and

Damion Thomas have anchored a nascent subfield in the diplomatic history of sport that has systematically traced the role of athletics in U.S. international relations and the

6 For examples of informative studies dealing with media representations of sport, see Daniel Nathan, Saying It’s So: A Cultural History of the Black Sox Scandal (Urbana, IL: University of Illinois Press, 2005); Michael Oriard, King Football: Sport and Spectacle in the Golden Age of Radio and Newsreels, Movies and Magazines, the Weekly and Daily Press (Chapel Hill, NC: University of North Carolina Press, 2003). For exemplary histories of racial identity in the context of sport, see Amy Bass, Not the Triumph but the Struggle: The 1968 Olympics and the Making of the Black Athlete (Minneapolis, MN: University of Minnesota Press, 2004); Adrian Burgos, Playing America’s Game: Baseball, Latinos, and the Color Line (Berkeley, CA: University of California Press, 2007). For an enduring examination of the history of gender and class in the context of American sport, see Elliott Gorn, The Manly Art: Bare-Knuckle Prize Fighting in America (Ithaca, NY: Cornell University Press, 1986). For more on gender in particular, see Susan Cahn, Coming on Strong: Gender and Sexuality in Twentieth-Century Women’s Sport (Cambridge, MA: Harvard University Press, 1995). On “affect” in sports history, see Douglas Booth, “History, Culture, Surfing: Exploring Historiographical Relationships,” Journal of Sport History 40, no. 1 (Spring 2013): 3-20.

7 Recent versions of the Journal of Sport History “Dissertations Survey” available at http://muse.jhu.edu/journals/journal_of_sport_history/. 6

dissemination of American capitalist ideology.8 Walter Lafeber, the prolific scholar of

American empire, has contributed to this debate by using the marketing and consumption

of Michael Jordan as a case study in how the growth of mass-mediated sport in the 1990s

depended on powerful networks of information companies, largely invisible sweatshop

labor, and athletic icons who appealed to consumers across boundaries of race, gender,

and class.9

Finally, I suspect that historians have shied away from addressing the recent role

of sport in urban growth because of the seemingly unassailable consensus established by

scholars in other fields who have written extensively on the topic. In particular, urban

economists and policy experts—orthodox and heterodox, “free-market”-oriented and radical—have, time after time, concluded that new professional sports facilities are usually good for team owners’ bottom line, but seldom if ever good for urban economies as a whole. Overwhelmingly, their studies show that sports teams and facilities do not have—all else being equal—a positive effect on metropolitan growth writ large. As economists John Siegfried and Andrew Zimbalist note, “few fields of empirical economic research offer virtual unanimity of findings. Yet, independent work on the economic impact of stadiums and arenas has uniformly found that there is no statistically significant positive correlation between sports facility construction and economic development.”10

Most economists also agree that cities have continuously made poor cost-benefit

decisions surrounding public subsidies for teams because of the exceptional monopoly

8 See Barbara Keys, Globalizing Sport: National Rivalry and International Community in the 1930s (Cambridge, MA: Harvard University Press, 2013); Damion Thomas, Globetrotting: African American Athletes and Cold War Politics (Urbana, IL: University of Illinois Press, 2012).

9 LaFeber, Michael Jordan and the New Global Capitalism.

10 John Siegfried and Andrew Zimbalist, “The Economics of Sports Facilities and Their Communities,” Journal of Economic Perspectives 14, no. 3 (Summer 2000): 103. 7

powers enjoyed by the professional sports business (most notably leagues’ legally

sanctioned ability to limit franchise expansion and maintain an artificial scarcity of

teams).11 While historians, like their peers in other fields, often thrive on challenging

prevailing wisdom, the fact that scholars approaching the issue from such a diverse array

of theoretical and ideological perspectives have arrived at similar results might give the

impression that there is little left to know when it comes to the role of professional sports

teams in urban development.

It’s certainly tempting to assume that the insights of economists and policy

experts have closed the book on the urban political economy of sport in the late

twentieth-century U.S. now that we have a compendium of research that, in the words of

one set of experts, “unanimously challenge[s] the assertion that new stadiums will create

waves of ancillary economic activity whose benefits will trickle down to the entire

community.”12 However, as I claim above, the urban history of the professional

basketball business in Chicago reveals that our understanding of the links between sport

and city-building during the 1980s and 90s remains incomplete. My approach to telling a

more complete story draws on the insights of urban sociologists John Logan and Harvey

Molotch, who argue that evaluating urban growth requires more than understanding how

11 Mark Rosentraub, Major-League Winners: Using Sports and Cultural Centers as Tools for Economic Development (Boca Raton, FL: CRC Press, 2009) , 1-2. On the failures of sports-linked development, see also Robert Baade, “Professional Sports as Catalysts for Metropolitan Economic Development,” Journal of Urban Affairs 18, no. 1 (1996): 33-38 and Roger Noll and Andrew Zimbalist, eds., Sports, Jobs and Taxes: The Economics Impact of Sports Teams and Stadiums (Washington, D.C.: Brookings Institution Press, 1997). On the market/monopoly power enjoyed by the professional sports business, see Judith Grant Long, Public/Private Partnerships for Major League Sports Facilities (New York, NY: Routledge, 2013); William Kern, ed., The Economics of Sports (Kalamazoo, MI: Upjohn Institute for Employment Research, 2000); James Quirk and Rodney Fort, Pay Dirt: The Business of Professional Team Sports (Princeton, NJ: Princeton University Press, 1992); James Quirk and Rodney Fort, Hardball: The Abuse of Power in Pro Team Sports (Princeton, NJ: Princeton University Press, 1999).

12 Kevin Delaney and Rick Eckstein, Public Dollars, Private Stadiums: The Battle Over Building Sports Stadiums (New Brunswick, NJ: Rutgers University Press, 2003), 30. 8

particular strategies affect “exchange values,” or the economic rents that accrue to property owners as a result of development (in the form of rising property values, increased commercial income, etc.). While measuring exchange values may help economists understand what does or does not promote urban growth, Logan and Molotch insist that it is equally important to grasp how particular types of development expand, sustain, or limit the “use values” that accrue to residents in the form “material and non- material” assets which meet the “essential needs of life.” These use values include things like schooling, accessibility to healthcare, formal community institutions (spiritual, political, or otherwise), informal social networks, and community identity. As Logan and

Molotch point out, “the pursuit of exchange values in the city does not necessarily result in the maximization of use values for others. Indeed, the simultaneous push for both goals is inherently contradictory and a continuing source of tension, conflict, and irrational settlements.”13

With this framework in mind, I structure each of the stories that make up my

larger narrative by asking the following questions: For whom did the Bulls create value

within Chicago? What type of value was it? Did this creation of value threaten or

preclude the generation of certain types of value for others? In attempting to answer these

questions, I take an eclectic methodological approach, drawing on tools like media

analysis, oral history, geographic information systems (GIS), and even a small dose of

statistical analysis when appropriate. In the end, the balance of evidence suggests that,

however much excitement the Bulls brought to Chicagoans, the franchise’s growth during

the 1990s exacted major costs from the city that fell most heavily on the most vulnerable

13 John Logan and Harvey Molotch, Urban Fortunes: The Political Economy of Place (Berkeley, CA: University of California Press, 1987), 20, 2, 99-110. 9

parts of the population—costs I think readers will agree were far from offset by the presence of a championship basketball team.

The specific plan of the dissertation unfolds in six chapters. The first chapter uses popular press accounts and municipal archives to recount the Bulls’ emergence as what one pair of urban studies scholars characterize as “the most effective accidental public relations campaign ever mounted on behalf of the city of Chicago.”14 Richard M. Daley’s

election in 1989 ushered in an urban growth model centered on transforming the city

from an icon of racial conflict and political corruption into a cosmopolitan cultural

destination, and local press and pro-growth associations like the Chamber of Commerce

touted the Bulls’ growing international fame as proof that Chicago was back on the map,

ready for a new influx of corporate investment and consumer spending. These same

boosters argued that the team functioned as civic glue binding together a city fractured

along lines of race and class. In the short run, such claims existed alongside the jarring

explosion of food riots in poor South and West Side neighborhoods after several of the

Bulls title-clinching victories. More long term, this alleged civic harmony coincided with

trends such as a significant rise in public school segregation and intensified policing of

poor communities of color. In the end, the Bulls were an asset for those marketing the

city to outsiders, but a much more mixed blessing for the team’s poorer neighbors.

In the larger context of urban transformation, these contradictions were

predictable. But the opportunistic use of the Bulls’ notoriety by pro-growth advocates

differed from other major urban branding initiatives like the “I ♥ New York” campaign.

Rather than emerging as the result of deliberate planning on the part of urban elites, the

14 Costas Spirou and Larry Bennett, It’s Hardly Sportin’: Stadiums, Neighborhoods, and the New Chicago (DeKalb, IL: Northern Illinois University Press, 2003), 181. 10

symbolic capital of the Bulls more or less fell into the lap of Chicago’s pro-growth coalition. In fact, city officials initially balked at basketball-linked urban branding, and only cautiously embraced it after the press and private enterprise made a compelling case that the buzz around Jordan and company could actually function as a meaningful and enduring piece of the larger pro-growth toolbox. In outlining this process, I draw heavily

on the research of urban sociologists like Miriam Greenberg, whose work on the re- branding of New York during the 70s and 80s demonstrates how the reconstitution of cities as cultural destinations was often a contingent process driven not just by local tourism bureaus, but also by unanticipated mass-media exposure.15

While the rhetoric of “community-building” around the Bulls obscured harsher

realities, it also contained an important kernel of truth. As Chapter 2 shows, the massive

victory rallies in Grant Park following each of the Bulls NBA titles brought together a

racially diverse group of fans who met and celebrated with Chicagoans from

neighborhoods they had never set foot in. However, the one factor other than the love of

basketball that seems to have bound these celebrants together was their inability to afford

tickets to actual games. Using anecdotal evidence in combination with survey data on fan

demographics, I show that the team’s community-building function operated in a broader context of consumption in which even middle-class fans found it increasingly difficult to experience the team live and up close. For the most part, attending games at Chicago

Stadium, and especially at the United Center, became the pursuit of a largely wealthy group of basketball consumers born by the convergence of increasing wealth inequality and the Bulls’ deliberate efforts to cultivate and profit from a more moneyed fan base. In

15 See Miriam Greenberg, Branding New York: How a City in Crisis Was Sold to the World (New York, NY: Routledge, 2008). 11

this way, how Chicagoans experienced their fandom depended largely on their respective

ability pay for access.

The history of the United Center’s development fills out the remainder of the

dissertation. Chapter 3 traces the contentious neighborhood politics that surrounded the

arena’s construction during the eighties and nineties, and in particular how local residents on the Near West Side mobilized against stadium-linked development for the better part of a decade. Journalists and boosters characterized the eventual bargain struck between

Near West Siders and the team owners as proof that the professional sports business could step in to successfully redevelop declining neighborhoods where the state had failed to do so. Some even went so far as to argue that the United Center had protected a low-income African-American community from gentrification. However, these favorable

interpretations failed to recognize that neighborhood leaders who backed this bargain did

not represent the neighborhood as a whole. Local public housing residents continued to

actively oppose sports-linked development, which they feared threatened to transform

their neighborhood into the newest frontier in a rapidly expanding central business

district. Ultimately, the political resistance mounted by these public housing residents

exposed the United Center as a support for several hallmarks of “neoliberal urban policy”

identified by urban planners Kathe Newman and Philip Ashton, including an emphasis on

local homeownership to the detriment of low-income residents and the “deconcentration of poverty” via the displacement of poor.16

The fourth chapter continues the examination of neighborhood change around the

United Center, but shifts from the lens of political conflict to the lens of demographic and

16 Kathe Newman and Philip Ashton, “Neoliberal Urban Policy and New Paths of Neighborhood Change in the American Inner City,” Environment and Planning 36 (2004): 1151-1172. 12

spatial transformation. Making use of descriptive statistics, maps, and municipal records,

this chapter demonstrates that, despite the odes to “balanced development” by the arena

boosters, the neighborhood around the United Center suffered from dramatic

displacement in the years during and after the arena’s construction. While there is no

unequivocal proof that the United Center caused this displacement, there is a wealth of

evidence suggesting that it did little to stop it. In fact, if there was indeed an unequivocal

force pushing back against gentrification around the arena, it was the success of nearby

public housing residents in securing legal protection that guaranteed their right to remain

in the neighborhood. This chapter also draws on historical data on population change,

building permits, and land use to call into question claims that the United Center

functioned as an effective anchor for ancillary residential and commercial investment.

Chapters 5 and 6 delve into little known histories of how Bulls ownership

augmented the size and consistency of profits at the United Center by exploiting the

increasing willingness of the state at the end of the twentieth century to abandon its

regulatory function in favor of acting to reduce the investment risk faced by major

commercial real estate interests.17 The fifth chapter draws on oral histories and legal

records to recount how both federal courts and the Chicago City Council helped the team

owners eliminate competition from independent food and souvenir peddlers around the

United Center. When the peddlers filed an anti-trust suit against the arena owners for establishing a ban on bringing items purchased outside into the arena, federal judges insisted that the courts had no right to intervene in rules imposed on customers by a private sports facility. Ironically, fearing that appeals to higher courts might result in a

17 On this broader transformation, consult David Harvey, A Brief History of Neoliberalism (New York, NY: Oxford, 2005) and James K. Galbraith, The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too (New York, NY: The Free Press, 2009). 13

favorable verdict for the vendors, the team owners successfully lobbied local city councilmen to pass an ordinance banning the presence of the vendors within 1,000 feet of the new arena. This represented a significant expansion of the Bulls’ market power, but ultimately it resulted not from the special treatment historically offered to teams and leagues by the government, but rather from the much larger trend towards local and national governments’ prioritization of risk-reduction for private firms throughout the economy.

Using state legislative archives and records from the Cook County Assessor’s and

Clerk’s Offices, the sixth and final chapter presents a comprehensive property tax history of the United Center which shows that the arena’s owners have benefited from hundreds of millions of dollars in property tax abatements since the facility opened in 1994.

Despite paying for the construction costs up front, the owners devised a way to gradually saddle taxpayers with the bill while keeping every cent of the profits generated by the facility (which would have been significant even in the absence of the tax breaks). While this should not necessarily come as a surprise, it provides another important example of how the growing economic and political power of sports franchises owed as much to larger shifts in the structures of urban capitalist accumulation as it did to any sort of unique monopoly status. In the case of the tax breaks, they constituted just one example of a systemic effort by major commercial real estate interests in Chicago to push back against a local tax system which they perceived as offering favorable treatment to residential property owners at their expense. It also speaks to the importance of empirical and theoretical research on the relationship between the sports business and the state that goes beyond case studies involving well-publicized attempts by teams to secure public

14

bond issues to finance new or upgraded facilities. Moreover, given the fact that

economists and urban planners who have studied the “hidden costs” of sports facilities

have often overlooked such property tax arrangements, I argue in favor of the expanded use of historical methodology in the study of sports facilities finance—and, by extension, in the study of other forms of allegedly pro-growth urban fiscal policy.

In sum, my project places professional sport at the heart of urban transformation in the late twentieth century American city, and suggests the importance of integrating sports history and postwar metropolitan history. The Bulls not only emerged as an important part of the urban growth toolbox in the New Chicago, but also adapted their own business strategy to capitalize on structural changes in the local economy. The history of the Bulls franchise ultimately reminds us that the new sports history is not just about the role of athletes and leagues in a world of wall-to-wall media spectacle, but also

about how teams shaped and were shaped by the recent history of the cities in which they

reside.

15

Chapter One

Bullish on Image: Basketball and Urban Branding in the “New Chicago”

During the mid-1970s, the Tribune’s Bob Logan stamped his columns on the often disappointing Bulls with the label “Chicago: City of Losers.” For Logan, the label had less to do with the team’s win-loss record—in fact, the fledgling Bulls franchise went to the playoffs six straight times beginning in the 1969-70 season—than it did with their propensity to crumble when it mattered most. As a case in point, he cited the Bulls’ loss to the Golden State Warriors in the 1975 Western Conference Finals after building a 3-2 series advantage as a “choke job that ranks right up there with the 1969 Cubs,” who had squandered an eight-and-a-half-game division lead in the last six weeks of the season and ultimately missed the playoffs.1

By 1975, such a letdown was an especially bitter pill for Chicago sports fans, as the rest of the city’s teams had languished in the doldrums of their respective leagues for

the first half of the decade (the Cubs, White Sox, and Bears combined for zero postseason

appearances during this stretch). Moreover, before 1980, because of “erratic” television

coverage and hysteria about the league being “too black” and “drug-infested,” many

perceived the NBA as a second-class operation on the verge of collapse. In short, the

closest the city’s sports faithful could come to gratification was a fleeting tease by a team

with an uncertain future.2

1 Bob Logan, “Bulls’ New Wrinkle: Picking Spots to Lose,” Chicago Tribune, September 8, 1976, ProQuest.

2 David L. Andrews, Sport-Commerce-Culture: Essays on Sport in Late Capitalist America (New York, NY: Peter Lang, 2006), 15. 16

Several abysmal seasons in the late seventies, marketing difficulties on the part of the NBA as a whole, and the sudden resurgence of the Chicago Bears football team all

contributed to waning interest in the Bulls, and between 1980-81 and 1983-84 seasons

average attendance at Bulls home games dropped from 9,500 (just below the league

average of 10,000) to less than 6,400 (well under the league average of 10,600).3 But just as “Bears fever became an epidemic of wonderful lunacy,” the Bulls made the move that would, in the words of one local journalist, transform the struggling franchise “from

Chicago’s unloved stepchild to favorite son status.” The selection of Michael Jordan by

Chicago’s new management in the 1984 draft sparked an epic turnaround that reached its apotheosis in 1998 when Jordan led the team to its sixth NBA title in eight years. After the first championship in 1991, the Sun-Times still insisted that even though “the applause-o-meter for the Bulls jittered in the fever zone this week, [it] fell a shade short of Bears hysteria” that had followed the 1986 Super Bowl. However, by the time Jordan sunk the game-winner in the final game of the 1998 finals, Chicago’s sports pages had unequivocally crowned the Bulls as the city’s sporting kings. After Jordan announced his retirement, the Sun-Times’ Jay Mariotti waxed poetic about the importance of MJ to the

“City of Losers”: “He gave Chicago a shot of self-esteem that made our chests swell and

our lungs roar every springtime…You can talk about your ’85 Bears and how they’re the

real heroes of the generation, but your grandkids won’t ask you about Walter Payton and

Jim McMahon.”4

3 Author’s calculations based on data from Rodney Fort, “NBA Attendance Index,” Rodney’s Sports Economics, updated May 24, 2013, https://umich.box.com/s/41707f0b2619c0107b8b/1/320022885.

4 “It’s Wrong to Gloat, But…,” Chicago Tribune, January 28, 1996, ProQuest; Paul Sullivan, “Bulls: From Unwanted to Beloved in 25 Years,” Chicago Tribune, February 4, 1991, ProQuest; Tom McNamee, “Bulls Sharpen City’s Image,” Chicago Sun-Times, June 16, 1991, NewsBank; Jay Mariotti, “It’s All Over Now: MJ Walking Away,” Chicago Sun-Times, June 12, 1999, NewsBank. 17

Mariotti’s column was part of a larger narrative crafted by local media during the

1990s about the alleged power of Jordan and the Bulls to rejuvenate Chicago. The unprecedented success of the Bulls, so the story went, was about much more than talking trash to Pistons and Lakers fans. It was about the salvation of a city reeling from generations of economic and political turmoil. By 1980 the decades-long flight of taxpaying businesses and workers had hollowed out Chicago’s economy, and Mayor

Richard M. Daley responded after taking office in 1989 by attempting to rebrand Chicago as a premier cultural destination for tourists and young professionals. This required concerted efforts to rehabilitate the popular image of Chicago, a city many viewed as a

“racially divided, economically crippled emblem of the…Rust Belt.”5 Even though the

second Mayor Daley seemed indifferent towards using professional sports as part of his

larger urban rebranding scheme, the local media, invested for its own reasons in repairing

the city’s image, placed the Bulls front and center in its efforts to combat the common-

sense association of Chicago with vice, corruption, and social conflict.

The logic behind the media’s notion of the Bulls as a timely civic savior usually

followed one of two tacks. In the first place, news outlets like the Tribune and Sun-Times

argued that the team—and especially Jordan—transformed the iconic character of the

city, supplanting images of Chicago as the seamy headquarters of Al Capone with those

of a classy, overachieving group of professional athletes. As one local businessman put it,

Michael Jordan and the Bulls “stood for the transition of this town’s image from being

the city of gangsters to the city of champions.”6 While nobody could quantify precisely

5 Larry Bennett, Third City: Chicago and American Urbanism (Chicago, IL: University of Chicago Press, 2010), 4.

6 Jeff Borden, “There Goes Mr. Jordan,” Crain’s Chicago Business, October 11, 1993, ProQuest. 18

the alleged benefits of this makeover, the press offered many examples of how the

symbolic displacement of Capone by Jordan and the Bulls brought real benefits to the

city, making it more attractive to potential visitors, residents, and investors. As the leaders of deindustrializing cities embraced a growth model that depended on marketing revitalized downtowns, expanded leisure infrastructures, and other place-specific cultural capital, many members of Chicago’s pro-growth coalition—led by the local media— identified and cultivated the Bulls as a crucial asset.

The second rationale behind the Bulls’ status as civic savior suggested that, beyond a rehabilitated civic image, professional basketball in Chicago generated much needed social cohesion, allowing parts of the city historically at odds with one another to come together in celebration of the Bulls. During the 1980s, Harold Washington, the city’s first African-American mayor, pushed back against a downtown-first model of growth in ascendance since the tenure of the first mayor Daley, and encouraged the political agency of minority groups traditionally excluded from decisions about urban redevelopment. However, when Richard M. Daley assumed the mayoralty in 1989, he reprioritized the interests of a local growth coalition with no inclination to divert investment away from the Loop and towards economically disadvantaged communities.

In doing so, he risked perpetuating Chicago’s identity as an economically and racially stratified metropolis. In this context, the media spun the universal appeal of the Bulls dynasty as a timely salve for a socially fractured city. Ironically, the fractures came into

sharp relief immediately after several of the team’s title-clinching games—most notably

in 1992—when urban uprisings erupted predominantly in poor black neighborhoods.

19

While the local media shrugged off the uprisings as celebrations-gone-wrong, in fact they revealed the fragility of the “community” of Chicagoans who rallied around the Bulls.

Broadly, this chapter argues that the Bulls of the 1990s, and in particular Michael

Jordan, offered pro-growth advocates in Chicago a made-to-order urban “brand” precisely at the moment when the city’s economic future allegedly depended on its ability to differentiate itself as a unique hub of leisure and culture. The local media, aided immeasurably by the NBA’s emergence as a global television phenomenon, jumped at the chance to cultivate the Bulls as a powerful symbolic support for this “New Chicago.”7

The “power” of the Bulls in this sense emanated not so much from measurable effects on

employment or spending, but rather the way in which they enabled local boosters to

implement an incredibly low-risk—and potentially high-reward—urban branding

campaign centered on professional sports. Unlike many other such campaigns, the

rhetoric around the Bulls as saviors of civic identity was not linked directly to attempts

by the team owners to secure public funding for a new stadium or winning a bid to host a

“mega-event” like the Olympics.8 In fact, the “costs” of this particular initiative did not

go much beyond regular column space. This history confirms that at the end of the

twentieth century, successful sports franchises offered opportunistic urban growth

coalitions an attractive, if highly contingent, tool for dismantling images of urban crisis

and replacing them with images of vitality and unity. This alleged unity, however,

7 I borrow the label “New Chicago” from Costas Spirou and Larry Bennett, who use it to identify the new leisure-intensive urban economy that emerged under Richard M. Daley. Costas Spirou and Larry Bennett, It’s Hardly Sportin’: Stadiums, Neighborhoods, and the New Chicago (DeKalb, IL: Northern Illinois University Press, 2003).

8 For a case study of urban branding in the context of sporting mega-events, see David Rowe and Pauline McGuirk, “Drunk for Three Weeks: Sporting Success and City Image,” International Review for the Sociology of Sport 34, no. 2 (1999): 125-141.

20

ultimately distracted from processes of exclusion endemic to the growth model supported by the Bulls brand.

Before the Stampede: Politics, Economics, and Reputation in Pre-Championship Chicago

To appreciate the symbolic value of Jordan and the Bulls in Chicago’s new economy, one has to understand why, by 1990, local elites felt that the city desperately needed an image makeover. The story is a familiar one, interchangeable in its broadest outlines with the fate of many urban centers after World War II. By the 1950s, Chicago started to lose manufacturing jobs to new production facilities in nearby suburbs,

Southern states, and overseas; and good-paying positions at factories that remained within the city often dried up as productivity gains created redundancies.9 The number of

Chicagoans working in manufacturing plunged by almost two thirds between 1950 and

1990, and over the same period the city’s population plummeted by more than 800,000

(see Table 1.1). In response to this decline, Richard J. Daley, who served as mayor from

1955 to 1976, supported the formation of a pro-growth coalition bent on expanding and tightening links between City Hall and the private service sector, especially major players in finance, insurance, and real estate.10

9 Costas Spirou, Urban Tourism and Urban Change: Cities in a Global Economy (New York, NY: Routledge, 2011), 15.

10 Barbara Ferman, Challenging the Growth Machine: Neighborhood Politics in Chicago and Pittsburgh (Lawrence, KA: University of Kansas Press, 1996), 59. 21

Table 1.1. Selected Employment and Population Statistics, City of Chicago, 1950-1990. Employed % Employed in Percent Total Population Personsa Manufacturing Unemployedb 1950 3,620,962 1,614,867 36.70 n/a 1960 3,550,404 1,501,731 33.50 5.20%c 1970 3,369,357 1,387,908 32.00 4.40% 1980 3,005,072 1,235,865 26.60 9.80% 1990 2,783,726 1,207,108 18.70 11.30% Sources: U.S. Census Bureau, County and City Data Book (1956, 1967, 1972, 1983, 1994); Chicago Community Inventory (1963). a Economic and employment data reported by the Census after 1960 based on sample-based estimations, as opposed to full counts. b “Percent unemployed” calculated by dividing number of people reported as “unemployed” by the total civilian labor force (an individual qualified as “unemployed” if: 1) they did not have a job at the time of questioning, 2) had searched for a job in the last month, and 3) were available to accept a job). These numbers, which are derived from the decennial census, vary somewhat from the estimates from the Current Population Survey (CPS) used by the Bureau of Labor Statistics to estimate monthly unemployment, which is generally thought of as more precise (unlike the Census, the CPS does not rely on self-enumeration and involves better-trained interviewers). c Unemployment numbers for 1960 for male civilian labor force only. “Labor force” included persons 14 years and older in 1960, but subsequent surveys raised the cutoff to 16 years old.

Daley provided the Chicago Central Area Committee (CCAC)—a local booster organization made up of representatives from downtown real estate firms, banks, insurance companies, and architectural firms—with privileged access to the mayor’s office, institutionalizing a local redevelopment model that placed revitalization of the

Loop at its center.11 The logic behind this was fairly straightforward: since the city’s status as a manufacturing center was continuing to erode, city officials had to identify new, viable growth strategies. As urban sociologist Miriam Greenberg explains, the fiscal strains of deindustrialization forced urban mayors to take measures to distinguish their particular cities in the eyes of investors, especially as “technological advances in transportation and communications render[ed] locational differences less significant.” In other words, cities had to reinvent the “monopolistic privilege” they had previously enjoyed because of the benefits they offered to business by virtue of their geography (e.g.

11 For a helpful overview of the CCAC, see Ferman, Challenging the Growth Machine. 22

concentration of railroad networks in the case of Chicago).12 In this new economic

landscape, the first Mayor Daley used his influence over the direction of federal urban

renewal dollars, the location of infrastructural support projects, and land use regulations

as incentives for real estate developers and other commercial interests to invest in

Chicago’s central business district.13

In the final years of his tenure, Richard J. Daley also began a modest push to

channel resources into marketing the city as a destination not only for potential investors,

but also for the conventioneers, tourists, and new residents who would create consumer

demand for property, services, and entertainment downtown. After his decision in 1970

to merge the city’s Convention Bureau with the local Tourism Council under the banner

of “Selling Chicago to the World,” Daley certainly had potential investors in mind when

he wrote, “we all can look forward to helping guide our city to a position as Number One

in both conventions and tourism…As Mayor, I can assure you that every department of

our city government will do all it can to further our reputation as a great place to visit and

a great place to do business.”14

The joint efforts by the mayor and the downtown business community to attract

private investment underwrote Chicago’s postwar “growth machine.” John Logan and

Harvey Molotch define the typical growth machine as “an apparatus of interlocking pro- growth associations and governmental units” bent on “creating conditions that intensify

12 Miriam Greenberg, Branding New York: How a City in Crisis Was Sold to the World (New York, NY: Routledge, 2008), 29.

13 Joel Rast, “Manufacturing Industrial Decline,” Journal of Urban Affairs 23, no. 2 (Summer 2001): 178.

14 Among the tasks charged to the new Chicago Convention and Tourism Bureau was “bringing travel editors and writers from around the world on familiarization tours of Chicago.” Chicago Convention and Tourism Bureau, Selling Chicago to the World, 1970, 2, 5, Chicago Convention and Tourism Bureau Miscellaneous Pamphlets, Chicago History Museum, Chicago, IL. 23

future land use in an area.” Put another way, urban growth machines bring together

private business interests and local policymakers under the agenda of attracting outside

investment and maximizing rents that investors can extract from property buyers, tenants,

entertainment seekers, and other consumers. Advocates of this model have long argued

that such growth “helps the whole community” since it allegedly “brings jobs, expands

the tax base, and pays for urban services.” However, as Logan and Molotch are quick to

point out, developers and their allies in local government have rarely distributed the

benefits evenly. More often than not, the model’s proponents have opposed regulation

meant to ensure that residents without the means to pay rents set by the market still enjoy

the benefits of growth.15

In postwar Chicago, this unevenly distributed development manifested itself in the city’s racial geography. The private and public investment that poured into the Loop funded a racialized revitalization scheme that political scientist Barbara Ferman describes as “renewal through removal.” Convinced that the presence of working and poor blacks in and around the Loop would deter investment, Daley and his allies in the business community oversaw several massive developments during the 1950s and 60s that displaced thousands of African-Americans.16 Projects like Sandburg Village on the Near

North Side and the University of Illinois, Chicago on the Near West Side ultimately

functioned as buffers between downtown revitalization and nearby black neighborhoods.

To make matters worse, Daley and the City Council directed the Chicago Housing

Authority (CHA) to locate new public housing projects—projects that would absorb poor

15 John Logan and Harvey Molotch, Urban Fortunes: The Political Economy of Place (Berkeley: University of California Press, 2007), 32, 33, 13.

16 Ferman, Challenging the Growth Machine, 61. 24

blacks displaced by downtown development—in intensely segregated neighborhoods outside of the Loop. In the words of historian Paul Street, local officials designed the new

CHA high-rises “to prevent the horizontal spread of black Chicago by thrusting black families into the sky.”17

The barriers erected by Daley and his allies between the city’s whites and the black neighborhoods on the South and West sides systematically ensured that the latter languished in a state of permanent impoverishment. By 1970, more than one in five of

Chicago’s black families lived below the poverty line, and black families comprised almost sixty percent of all poor families in Chicago, whereas they made up only about a third of the population as a whole. Entrenched workplace discrimination and limited mobility ensured that the continued migration of well-paying blue-collar jobs out of the city hit black neighborhoods the hardest, and the onset of a severe economic downturn and increasing fiscal strain in the 1970s only made matters worse. While recession had wide effects, over the course of the decade the increase in poverty and unemployment rates among black Chicagoans far outstripped that of whites.18

17 Paul Street, Racial Oppression in the Global Metropolis: A Living Black Chicago History (Lanham, MD: Rowman & Littlefield, 2007), 108. For the definitive history of the racial politics of public housing in Chicago, see Arnold Hirsch, Making the Second Ghetto: Race and Housing in Chicago, 1940-1960 (New York, NY: Cambridge University Press, 1983). While all of the projects were technically outside of the Loop, the fact that many were located in unattractive blocks (e.g. near expressways or elevated train lines) near the Loop meant that, as gentrification radiated outward from the 1980s and 90s, many developers and local officials went from seeing CHA sites as out-of-the-way to in-the-way. See Larry Bennett, “Downtown Restructuring and Public Housing in Contemporary Chicago: Fashion a Better World Class City,” in Where Are Poor People to Live?: Transforming Public Housing Communities, ed. Larry Bennett, Janet Smith, and Patricia Wright, 282-300 (Armonk, NY: M.E. Sharpe, 2006).

18 Street reports that between 1969 and 1989, “the underestimated official black unemployment rate nearly tripled…rising from 7 to 20 percent [while] the city’s white unemployment rate went up from just 3.1 to only 5.4 percent during the same years…Black Chicago’s poverty rate rose from 24.5 to 33 percent while white Chicago’s poverty measure rose by less than one point to 9 percent over the same two decades.” Street, Racial Oppression, 121, 135. 25

For most whites, images of black poverty in places like Chicago functioned as a

source of anxiety about living, working, or playing in the city. Urban planning scholar

Robert Beauregard notes that in the popular (i.e. white, middle-class) American psyche of the sixties and seventies, urban blacks were “situated at the core of physical deterioration, crime, poverty, poor schools, and unemployment” and “binding that core together was fear…that centuries of racism and inequality would finally culminate in insurrection.”19

This aura of fear added to the motivation of white residents and investors to pack up and head to the suburbs.

By the time Richard J. Daley died in 1976, the combination of deindustrialization and racist, anti-urban imagery had cemented Chicago’s reputation as a bad place to live and do business. In 1975, Fortune magazine ranked the fifty largest cities in the U.S. based on several quality of life measures such as crime, housing, and professional achievement. Chicago came in third worst, ranked better than only St. Louis and

Newark.20 A 1977 Moody’s analysis of the investment climate in America’s twenty-five

most populous cities (see Table 1.2) showed that Chicago ranked in the bottom quartile

with respect to almost every measure. Between 1974 and 1978, property tax revenue

within the city dropped by 28 percent, and in the years following Daley’s death the local

manufacturing sector continued its precipitous decline (see Figure 1.1).21

During the 1970s, the annual growth rate of Chicago’s total personal income—a

proxy used by economists as an indicator of overall economic growth—lagged behind the

19 Robert Beauregard, Voices of Decline: The Postwar Fate of US Cities (Cambridge, MA: Blackwell, 1993), 164.

20 Beauregard, Voices of Decline, 202.

21 Ester Fuchs, Mayors and Money: Fiscal Policy in New York and Chicago (Chicago, IL: University of Chicago Press, 1992), 165. 26

national trend, and far behind cities like Las Vegas, where developers were pursuing an

economic development model based on a vibrant service and entertainment infrastructure

allegedly immune to competition from surrounding suburbs (see Figure 1.2).22 And while

Chicago averted a paralytic fiscal crisis on the order of the one that hit New York in the

mid-1970s, it did so only as a result of Richard J. Daley’s ability to ignore the

development needs of poor communities of color and cut spending at will—two practices

made possible by the intractable power of the Democratic machine, which ensured the

mayor’s reelection regardless of his attentiveness to grassroots community demands.23

22 For a discussion of entertainment-driven growth in North America, see John Hannigan, Fantasy City: Pleasure and Profit in the Postmodern Metropolis (New York, NY: Routledge, 1998).

23 Fuchs, Mayors and Money, 98. This is not to say that social spending caused urban crises of the 1970s, but rather that some cities had an easier time of shifting the burden of the crisis onto poor and working communities (esp. non-white ones). 27

Table 1.2. Selected Postwar Economic Indicators in Twenty Most Populous U.S. Cities/Metro Areas (ranked in descending order according to percentage change in population, 1950-70). Average Annual Growth Average Annual Growth Rate (%) of Total Percentage Change in Rate (%) of Assessed Personal Income, 1969- Population, 1950-1970 Property Valuation, 1975 (Standard Metro. (Standard Metro. 1950-1975 Statistical Area, City Statistical Area) (Central City) U.S. Avg. = 8.96 %) Phoenix 444.4 7.6 7.88 Jacksonville 158.6 n/a 11.30 San Diego 108.4 8.4 8.70* Houston 106.8 9.7 13.28 Dallas 94.4 8.8 9.76 Indianapolis 74.3 5.0 7.78 San Antonio 60.2 6.5 9.72** Memphis 57.5 5.5 10.31 Columbus 43.6 5.5 9.17** Los Angeles 42.9 5.3 6.51** Denver 23.8 4.6 11.77 Seattle 13.5 8.8 5.20** Milwaukee 12.5 6.9 8.04 Kansas City 11.1 3.4 n/a New Orleans 4.0 3.0 8.15** New York City 0.04 3.4 n/a Baltimore - 4.6 2.1 8.51 Philadelphia - 5.9 2.5 7.50 Chicago - 7.0 1.6 7.14** San Francisco - 7.7 3.9 7.03** Cleveland - 17.9 1.9 6.07** Detroit - 18.3 1.5 7.10 Boston - 20.0 0.5 7.42 Pittsburgh - 23.2 1.6 7.30 St. Louis - 27.4 0.4 7.29 Source: Adapted from data in Moody’s Analytical Overview of 25 Leading U.S. Cities (1977). *Measure for 1959-1973 (National Avg. = 7.5 %) **Measure for 1969-1973 (National Avg. = 8.93 %)

28

Establishments (left vertical) Employees (right vertical)

8,000 500

450

7,000 400 6,000 350 5,000 300

4,000 250

200 3,000 150

Number of of Number Establishments 2,000 100 Number of Employees of (thousands) Number Employees 1,000 50

0 0 1972 1977 1982 1987 1992 Year

Figure 1.1. Manufacturing Establishments and Employees in Chicago City, 1972-1992.a Source: U.S. Census Bureau, Economic Census of Manufactures: Geographic Area Series, Illinois (1975, 1980, 1985, 1996). a Data from 1972, 1977 and 1982 are based on definitions/codes in the 1972 edition of the Standard Industrial Classification Manual and the 1977 Supplement. Data from 1987 and 1992 are based on definitions in the 1987 edition of the Standard Industrial Classification Manual. As a result, figures from the two eras are not comparable (as reflected in the break in the trend line).

29

US Metro Portion Chicago-Joliet-Naperville Las Vegas-Paradise

25

20

15

10

Total Personal Income Growth Growth Income Personal Total 5 (percent change from previous period) previous from change (percent

0 1969-70 1971-72 1973-74 1975-76 1977-78 1979-80 Period

Figure 1.2. Total Personal Income Growth, Selected Metropolitan Statistical Areas, 1969-1979.a Source: U.S. Bureau of Economic Analysis, Interactive Data Tables, Table CA1-3. a Personal income differs from the “money income” measure commonly used by the Census, which includes only cash and cash equivalents. Personal income includes certain transfer receipts like Medicaid and Medicare, lump-sum payments apart from normal earnings, and contributions by employers to health and pension funds. The Bureau of Economic Analysis uses a combination of data from the census, government surveys, and administrative records to estimate personal income. Growth figures based on nominal dollars.

Admittedly, Chicago had never enjoyed a pristine image in America’s popular imagination. In 1951, Nelson Algren wrote of the city that it was “an infidel’s capital six days a week.”24 Ten years later, sociologist Anselm Strauss noted that mention of

Chicago invariably conjured up visions of “crime, vice, urban disorganization…represented by ‘Capone’, ‘gangsters’, and the famous Leopold-Loeb case, by juvenile delinquency, [and] by the well known slums and the black belt.”

However, until decades into the postwar era, this view had been counterbalanced by an

24 Nelson Algren, Chicago: City on the Make (Chicago, IL: University of Chicago Press, 1951), 16. 30

“imagery of enterprise” and “stupendous growth.” Notions of Chicago as the “Hog

Butcher of the World” and the “City of Big Shoulders” had, according to Strauss, somehow justified the vice and corruption in the minds of many, and led both residents

and outsiders to “accept them philosophically as inevitable in a city so enterprising and

daring.”25 During the first half of his tenure, Richard J. Daley maintained the city’s enterprising status and established himself as the mayor of the “City that Works” by virtue of mega-projects like the O’Hare airport expansion and the litany of urban renewal initiatives aimed at revitalizing the Loop.26 However, by the time Michael Bilandic took

over the mayoralty upon Daley’s death in 1976, the enterprising component of Chicago’s

image ushered in by a previous era of impressive growth had largely receded, leaving

stories of scandalous politics and urban violence to dominate.27

The victory of the self-styled reformer Jane Byrne in the 1979 mayoral race did

little to change things. Under Byrne, Chicago continued to hemorrhage population and

jobs. Shortly after the end of her tenure in 1983, a report published by the Commercial

Club of Chicago, a prominent pro-growth membership organization, offered a grim

outlook for the local economy, lamenting that “our problems are pervasive and the

downhill slide in job growth has been not only continuous but also precipitous.” It went

on to note that Chicago also continued to “suffer” from an “image problem” related to

how “outsiders view its quality of life,” which allegedly deterred business investment and

tourist spending. According to the report, this image deficit had much to do with

25 Anselm Strauss, Images of the American City (New York, NY: Free Press, 1961), 33, 50.

26 Marni Pyke, “Suburbs, O’Hare Mark 50-Year Milestone,” Daily Herald, April 1, 2013, ProQuest.

27 On corruption during this period, see James Merriner, Grafters and Goo Goos: Corruption and Reform in Chicago, 1833-2003 (Carbondale, IL: Southern Illinois University Press, 2004), esp. Chapter 9.

31

stagnation in the number of visitors and relatively anemic growth in the “convention and

trade show business.”28

Byrne not only failed to turn the ebbing tide of local growth, but also reneged on

promises to reprioritize neighborhood redevelopment beyond the Loop. Her alleged

“reformism” quickly gave way to wholesale acquiescence to the Democratic machine and

downtown interests she had vowed to undercut, as exemplified by her endorsement of a

ward redistricting that weakened local African-American political power. As Ferman

recounts, Byrne made it clear almost immediately after her election that she would bow

to the dictates of groups like the CCAC, thereby reinforcing “the neighborhood-

downtown cleavage.”29 Her capitulation ensured that most of whatever development

actually occurred would take place inside the Loop. In contrast to broader trends, in 1982

alone the number of private sector positions in Chicago’s central business district jumped

by more than 30,000, and between 1978 and 1982 the area added more than 4,500 new

residential units.30

Larry Bennett notes that black community organizations in Chicago understood

the nature of this cleavage long before the disappointment of Byrne, as indicated by the

fact that they were mobilizing all over the city by the late 1960s. This mobilization

28 Commercial Club of Chicago, Make No Little Plans: Jobs for Metropolitan Chicago (Chicago, IL, 1984), 12, 19, 27.

29 Ferman, Challenging the Growth Machine, 90.

30 Chicago Central Area Committee, Annual Report (Chicago, IL, 1981), 20, Chicago Central Area Committee Annual Reports, Chicago History Museum, Chicago, IL; Chicago Central Area Committee, Annual Report (Chicago, IL, 1984), 20, Chicago Central Area Committee Annual Reports, Chicago History Museum. Chicago, IL; Chicago Area Central Committee, Chicago Area Central Committee News, Fall 1983, Chicago History Museum, Chicago, IL. A 1987 report issued by the Commercial Club of Chicago added that “36 percent of existing office space in downtown Chicago was built in the last eight years [1979-1986] alone.” Commercial Club of Chicago, Jobs for Metropolitan Chicago (Chicago, IL, March 1987), Municipal Reference Collection, Harold Washington Library Center.

32

created a grassroots infrastructure geared towards bypassing Democratic ward

organizations, and by the early 1980s had galvanized a base of black voters willing to

cast their lot with non-machine candidates.31 These voters would serve as the backbone

of a progressive coalition of minorities, white liberals, and other disaffected voters that

propelled Harold Washington—a black Democrat who had previously broken with the

machine—into the mayor’s office in 1983.

Washington, unlike Byrne, made serious efforts to narrow the gap between the

Loop and the neighborhoods. He oversaw a sweeping overhaul of the city’s

administration of Community Development Block Grant (CDBG) monies, which

previous administrations had funneled disproportionately to downtown revitalization

through longstanding patronage networks.32 The new mayor not only cut block grant

subsidies for downtown development in order to redirect federal funds into neighborhood

development projects, he also attempted to use fiscal policy to redistribute wealth away

from downtown. Washington successfully pushed through a “lease tax” on commercial

leases and advocated aggressively for a “linked development tax” that would increase

levies on new downtown construction. Unlike his predecessors, he also de-emphasized

the use of costly, publicly-funded festivals and mega-events meant to showcase the Loop,

allowing several such initiatives to “die a quiet death.” Under Washington’s tenure, the city abandoned its support for the ChicagoFest food and music festival staged annually at

31 Larry Bennett, “Postwar Redevelopment in Chicago: The Declining Politics of Party and the Rise of Neighborhood Politics,” in Gregory Squires, ed., Unequal Partnerships: The Political Economy of Urban Redevelopment in Postwar America (New Brunswick, N.J.: Rutgers University Press, 1991), 170.

32 On Washington and the politics of CBDGs, see Ferman, Challenging the Growth Mchine, esp. chapters 5 and 6.

33

Navy Pier, and reduced its role in the famed Taste of Chicago extravaganza. In addition,

he withheld active support for Chicago’s bid to host the 1992 World’s Fair.33

Washington also actively countered efforts to displace and disenfranchise poor

communities of color. He froze urban renewal funds earmarked for the demolition of

public housing projects that private developers wanted gone.34 As documented by Joel

Rast, the “local producer” development strategy backed by Washington prioritized “job

creation over real estate development, the promotion and retention of industrial jobs over

service-sector jobs, and neighborhood over downtown redevelopment.” The key policy

component of this strategy was the creation of several Planned Manufacturing Districts

(PMDs), or areas subject to strict zoning laws intended to prevent upscale residential

development from encroaching on industrial firms.35

The local business community not only publicly lambasted Washington’s new fiscal priorities, but also devoted considerable energy to stymieing his reforms. The

CCAC waged a protracted campaign against the lease tax, eventually garnering enough

support among downtown elites and Washington’s political opponents to beat it back.

With this victory, the group’s 1986 Annual Report declared, “the CCAC will continue to

be against the imposition of new taxes on downtown development that will make the

33 David Elsner and Bill Barnhard, “Fixing the Gap, Nail by Nail: Business, City Attempt to Revive Once- Strong Tie,” Chicago Tribune, November 2, 1986, ProQuest; “Up Against Downtown? Not Anymore,” Chicago Tribune, January 25, 1995, Proquest; Robert Davis, “Daily Life in Chicago Is Far Different from Daley Life of Only a Decade Ago,” Chicago Tribune, December 7, 1986, ProQuest; John McCarron, “World’s Fair Lobby Ready to Call it Quits,” Chicago Tribune, August, 21, 1987. The decision to abandon the World’s Fair bid was no doubt a prudent one, given the fact that when New York hosted the event in 1964-65, it ended up hundreds of millions in the red On the economic impact of the New York World’s Fair, see Greenberg, Branding New York, 47-49.

34 See Ferman, Challenging the Growth Machine, Chapters 5 and 6.

35 Joel Rast, Remaking Chicago: The Political Origins of Urban Industrial Change (DeKalb, IL: Northern Illinois University Press, 1999), 85.

34

central business district less competitive with the suburbs and other regions of the country.”36 Ironically, data from a 1985 report by sociologist Terry Nichols Clark revealed that between 1972 and 1982, the tax rate paid by Chicago businesses had dropped from 52 to 37 percent.37 Thus, Washington often found himself outgunned by a growth coalition engaged in, to borrow from Logan and Molotch, “an unrelenting search…for more and more.”38

Despite such victories, traditional pro-growth advocates were genuinely anxious about how, in the words of an official CCAC publication, Washington’s embrace of

“increased political activism of [Chicago’s] diverse communities” had “drastically altered the rules of the game.”39 They also feared that the heated political conflicts sparked by

Washington’s reformism—not only with the business community but also with entrenched machine politicians who, like the notorious Ed Vrdolyak, stoked white racism by portraying Washington as a black mayor out to undermine the city’s white population—had further undermined Chicago’s national and international reputation.40 A

1987 report issued by the Commercial Club warned, “Chicago’s image to the outside

36 Chicago Central Area Committee, Annual Report (Chicago, IL: 1986), 21, Chicago Central Area Committee Annual Reports, Chicago History Museum, Chicago, IL.

37 James Strong, “City Taxes Take is Easy on Business, Report Says,” Chicago Tribune, April 16, 1996, ProQuest. For the original text, see City of Chicago, Business and Taxes in Chicago: A Report to the City of Chicago, by Terry Nichols Clark (Chicago, 1986), Harold Washington Library Municipal Reference Collection.

38 Logan and Molotch, Urban Fortunes, 32.

39 Chicago Central Area Committee et. al., The Chicago Project (Chicago, 1986), 13, Harold Washington Library Municipal Reference Collection. One of the more durable debates in urban sociology is the degree to which reform administrations like that of Washington actually broke with the politics of the growth machine. The “regime theory” school has, historically, been more open to the possibility of reform administrations changing the rules of the game than “growth machine” theory. For a nice summary of this debate and an attempt to show why the two approaches are not mutually exclusive, see Rast, “Manufacturing Industrial Decline.”

40 On interracial tensions between community organizations during the Washington administration, see Ferman. 35

world as a place to do business remains somewhere between neutral and negative, due in

no small part to the city’s divisive political wars.”41 Indeed, in Bennett’s telling, the “new

round of civic war” set off by the election of Washington “earned [Chicago] the

designation ‘Beirut by the Lake’, a label reflecting Chicagoans’ fears of inextricable

racial/ethnic polarization coupled with a physically devastated cityscape.”42

The Bulls as Municipal Icon in the “New Chicago”

News of Harold Washington’s sudden death on November 25th, 1987 shocked

supporters and adversaries alike.43 The progressives that had re-elected Washington the

previous year wondered if their drive for reform had just died along with the mayor, and

their fears were confirmed when loyalists to the Democratic machine rammed through an

eleventh hour deal to install their preferred man, Eugene Sawyer, in the mayor’s office.

In Milwaukee, far away from the political wrangling back in Chicago, Michael

Jordan and the Bulls went about their business as usual. The day that Washington passed

away, Jordan led the team to victory against the rival Milwaukee Bucks, netting 33 points

in one of the many awe-inspiring performances that would culminate in his first NBA

Most Valuable Player award at the end of the 1987-88 season.44 Jordan had already

enraptured Chicago hoops fans with his high-flying play. However, a decade and six championships later, MJ and the Bulls owned Chicago. Though avowedly apolitical,

41 Commercial Club of Chicago, Jobs for Metropolitan Chicago: A Two Year Report (Chicago, IL, 1987), 13.

42 Bennett, Third City, 5-6.

43 Dirk Johnson, “Chicago’s Mayor Washington Dies After a Heart Attack,” New York Times, November 26, 1987, LexisNexis.

44 “1987-88 Chicago Bulls Roster and Statistics,” Basketball-Reference.com, http://www.basketball- reference.com/teams/CHI/1988.html. 36

Jordan ultimately emerged as the most important black man in the city after

Washington’s death. As the NBA titles piled up the local media argued that Jordan and his teammates had not only reinvigorated Chicago sports, but were also helping the city shed its long-running image as a cesspool of political corruption and economic decline.

Days before the Bulls clinched their first NBA championship in 1991, the Tribune wrote,

“perceptions are everything, and a brief look at the history of word-association in

Chicago proves that, with the Bulls and Jordan as ambassadors, the city is a lot better off.” “Al Capone…Corrupt politicians…Racial division…Kids who can’t read…Bankrupt,” the paper continued, “these little word associations could go on and on.

For the most part, they are history now.”45 At least symbolically, the Bulls had helped the city get back on track.

For Richard M. Daley, son of the illustrious Richard J. and winner of the1989 mayoral election, the timing of this alleged makeover of the city’s image by the Bulls could not have been more perfect. Daley the younger quickly deflected the redistributive growth agenda initiated by Washington, and replaced it with a growth strategy focused on transforming the city—the Loop and adjacent neighborhoods in particular—into a world class cultural destination for tourists, young professionals, and business headquarters.

Fully embracing the Tribune’s admonition that “perceptions are everything,” he made marketing a more attractive image of the city one of his top agenda items. This policy turn entailed the reversal of key reforms ushered in by the Washington administration.

For example, Daley made it clear that he would not allow neighborhood organizations the same level of access to the mayor’s office, ensuring that the political connections of local

45 Charles Madigan, “Michael: The City’s Most Valuable Imagemaker,” Chicago Tribune, June 2, 1991, ProQuest.

37

business interests went unchallenged. In Bennett’s telling, he “largely rejected

Washington’s belief in community participation in planning and implementing public policy.”46 Secondly, he abandoned serious efforts to implement redistributive fiscal policy that had generated fierce antagonism between Washington and downtown business interests.47

Richard M. Daley’s rise to power happened at a moment when, as political

scientist Dennis Judd explains, it had become “clear to central city mayors that the federal government would no longer help them with the economic and fiscal problems brought on by suburbanization and deindustrialization.”48 On top of this, planners and

developers had realized by this point that the frenzied construction of downtown office

space that characterized the seventies and eighties could not sustain adequate growth on

its own.49 Moreover, especially in northern and Midwestern cities like Chicago, investing

resources in efforts to compete more effectively against local suburbs for industrial

employment appeared pointless since, in the years before Daley took office, the economic

composition of the entire Chicago metro area—not just the central city—had been

shifting away from manufacturing and towards the service sector. As shown in Figure

1.3, the number of full- and part-time manufacturing jobs in the Chicago Metropolitan

46 Bennett, Third City, 95.

47 Joel Rast explains that despite the general policy U-turn, the new Daley did not abandon the reform project outright. In control of fewer patronage jobs than his father and under pressure from local community organizations empowered during the eighties, he actually continued a handful of Washington’s efforts to reinvigorate the city’s industrial base. Rast, “Managing Industrial Decline,” 185.

48 Judd notes that in the U.S., “between 1976 and 1986, in the service of the new downtown development strategy, 250 convention centers, sports arenas, community centers, and performing arts facilities were constructed or started, at a cost of $10 billion.” Dennis Judd, “Constructing the Tourist Bubble,” in Dennis Judd and Susan Fainstein, eds., The Tourist City (New Haven, CT: Yale University Press, 1999), 35, 36.

49 Hannigan, Fantasy City, 51, 56-57.

38

Statistical Area went from more than 967,000 in 1975 to just over 740,000 in 1987, while

service employment jumped from about 784,000 positions to almost 1.2 million.

100%

90% 20.6% 27.2% 80% Services 8.2% 70% 9.9% Finance, Insurance, & Real Estate 60% 25.4% 16.8% Manufacturing 50%

40% Retail & Wholesale Trade 22.1% 22.9% 30% Government 20% 13.3% 12.1% Other 10% 10.3% 11.1% 0% 1975 (total nonfarm jobs = 1987 (total nonfarm jobs = 3,809,428) 4,413,153)

Figure 1.3. Industry Share of Total Full-Time and Part-Time Non-Farm Employment, Chicago- Joliet-Naperville (IL-IN-WI) Metropolitan Statistical Area (MSA).a Source: U.S. Bureau of Economic Analysis, Interactive Data Tables, Table C25. a The Bureau of Economic Analysis uses a combination of data from the census, government surveys, and administrative records to estimate employment by industry. As a result of the suppression of data due to confidentiality issues, the figures for the Service industry are slight underestimates, and the figures for “Other” are slight overestimates. This does not effect the overall pattern, however.

In this context central city mayors had to—more than ever—jockey for position

within an expanding entertainment and tourist economy if they wanted to spark rapid

economic growth. In sociologist John Hannigan’s telling, by the 1980s municipal

officials and private developers in many central cities saw the creation of entertainment

and cultural destinations as a quick way to attract spending from maturing baby-boomers

living in the suburbs, and perhaps even lure them back to downtown areas as residents.

39

For many, this new “entertainment economy” represented the newest “magic elixir” for revitalization, and promised to generate jobs and tax revenue.50 More broadly, it appealed to planners enamored of the increasingly popular “human capital” theory of economic development, which posited that “concentrations of educated individuals, along with training, will produce high-levels of economic growth.” The notion that these individuals could be lured to cities in part by vibrant leisure economies provided an added impetus to leisure-centric growth strategies.51

While Washington had paid some attention to this this approach, it played second fiddle to his larger reform agenda, and Daley no doubt felt that the city needed to play catch-up in the competition for new residents and visitors.52 Daley immediately set about, in the words of Costas Spirou, “reinventing [Chicago] as a city of leisure,” and this meant, first and foremost, channeling unprecedented amounts of municipal resources

50 Hannigan, Fantasy City, 60-61, 129.

51 Michele Hoyman and Christopher Faricy, “It Takes a Village: A Test of the Creative Class, Social Capital, and Human Capital Theories,” Urban Affairs Review 44, no. 3 (January 2009): 319. For the classic explication of human capital theory, see Gary Becker, Human Capital: A Theoretical and Empirical Analysis With Special Reference to Education (Chicago, IL: University of Chicago Press, 1964). For an example of scholarship arguing that cultural capital plays an important role in luring human capital, see Terry Nichols Clark, ed., The City as Entertainment Machine (Boston, MA: Elsevier, 2004). For a rebuttal, see Spirou, Urban Tourism and Urban Change, 151.

52 The historical record shows that, for all his challenges to politics-as-usual, Washington had a pragmatic streak when it came to dealing with the changing landscape of urban growth, and he sometimes followed conventional development wisdom as a result. Cognizant of the fact that other cities had benefited from a growth in the leisure and tourism sectors, Washington called for luring more visitors to Chicago, and announced in 1985 that “we are going to make a full-court press on the whole question of tourism.” To back it up, Washington funded the formation of the city’s Department of Cultural Affairs, which, as part of its mission, was responsible for promoting Chicago to potential tourists. See Ray Mosely, “Mayor Finds City’s Image Rubbed Out,” Chicago Tribune, February 2, 1985, ProQuest; City of Chicago, A Winning Season: Department of Cultural Affairs Annual Report, 1984-85 (Chicago, 1985), Municipal Reference Collection, Harold Washington Library Center. Simultaneously, the State of Illinois, under the governorship of Jim Thompson, committed new resources to promoting Chicago as a destination city. The best example of this was the state-led, “Chicago, My Kind of Town” promotional campaign that ran during the early 1980s. “Such a Deal: Illinois and Chicago Strut Their Stuff to the World,” Chicago Tribune, February 2, 1986, ProQuest.

40

back towards new development in and around the Loop.53 Spirou estimates that, “from

1989 to 2003, the City of Chicago expended over $11 billion on public infrastructure

investments [and] almost $7 billion of that money is invested along a four-mile lakefront

stretch” in and around downtown.54 Most notable among the publicly funded

redevelopment projects were the expansion of the McCormick Place Convention Center

complex ($675 million), the transformation of Navy Pier into a shopping and

entertainment center (over $200 million), and of course the creation of Millennium Park

(public money covered $432 million of the $632 million tab).55 Daley also used taxpayer

money to host urban mega-events such as 1994 World Cup matches and the 1996

Democratic National Convention in an effort to showcase Chicago’s emerging identity as

a premier cultural destination. In addition, he expanded funding for Chicago’s

Department of Cultural Affairs and the Mayor’s Office of Special Events, the entities

within City Hall tasked with promoting Chicago as a world-class city. Between 1990 and

1999, annual funding for the two agencies increased from $23.7 million to $34.3 million

(in constant 1999 dollars), and in any given year the city spent half this money on

promoting and staging downtown festivals like Taste of Chicago and the Chicago Air &

Water Show.56

53 Spirou, Urban Tourism and Urban Change, 105.

54 Spirou, Urban Tourism and Urban Change, 106.

55 Costas Spirou, “Urban Beautification and the Construction of a New Municipal Identity in Chicago,” in John Koval et. al., eds., The New Chicago: A Social and Cultural Analysis (Philadelphia, PA: Temple University Press, 2006), 297.

56 City of Chicago, Office of Management and Budget, Program and Budget Summary (Chicago, 1991- 2000), Municipal Reference Collection, Harold Washington Library Center. These figures include intergovernmental transfers, and they represented only a small fraction of the overall budget (.46% in 1990 to .64% in 1999).

41

Daley’s larger strategy of marketing the “New Chicago” depended on

transforming the aesthetics the city. If his post-industrial growth strategy was to succeed,

Chicago would have to project a revamped image; no longer could the city’s political and

business establishment allow outsiders to identify Chicago by virtue of its vacant

factories, its historic tolerance of corruption and racial inequality, or iconic

embarrassments like the police riots during the 1968 Democratic National Convention.

As the Tribune noted the year before Daley’s election in 1989, “the Capone-era bullets are gone, but the violent image could be deadly to Chicago’s efforts to grow as a world- class city.” With this in mind, the new mayor initiated a sweeping cosmetic makeover of the Loop and several adjacent neighborhoods. He spearheaded the “greening” of the city, which involved planting hundreds of thousands of new trees, and also underwrote the strategic installation of fountains and wrought-iron fencing in areas with dense foot and passenger traffic. Commenting on these efforts, Daley remarked that they “soften” people, showing them that “life in the city is not just the heavy steel and concrete and cars and honking.” Such initiatives quickly garnered accolades from the local press. By

1999, Blair Kamin, the Tribune’s prolific architecture critic, had crowned Daley “the

great beautifier.”57

The moves by Daley to develop a cutting-edge leisure infrastructure within the central business district and supplement it with focused beautification efforts fulfilled the longstanding vision of downtown business interests to which Washington had paid

57 Steven Morris, “Tourism Promoters Wrestle with Chicago Image,” Chicago Tribune, September 4, 1988, ProQuest; David Mendell, “New Attractions Making Chicago City that Bubbles,” Chicago Tribune, June 19, 1998, ProQuest; Blair Kamin, “Building the City Beautiful in Mayor Daley’s Chicago,” Chicago Tribune, April 15, 1998, ProQuest; Blair Kamin, “Outsider Art is Catalyst for Creativity,” Chicago Tribune, November 7, 1999, ProQuest. On the proliferation of gates and fountains, also see Spirou, Urban Tourism and Urban Change, 132-133.

42

relatively little attention. Position papers and promotional literature produced by the

Chicago Central Area Committee during the early eighties repeatedly called for the redevelopment of Navy Pier, a new lakefront park, and extensive street-scaping and greening efforts as means of increasing “Chicago’s appeal as a center for cultural activities and recreation” and supporting “continued growth of the city’s tourism industry.”58 The aforementioned reports issued by the Commercial Club echoed these

desires, calling for an urban “marketing program…directed at correcting misconceptions

of the area and improving its overall image.”59

Daley moved quickly to make these visions a reality, and while the causal impact

of his policies remains up for debate, there is no doubt that they coincided with

impressive growth in neighborhoods and industries high on City Hall’s list of priorities.

According to census data (see Table 1.3), Chicago enjoyed a boom in downtown population during the nineties unrivaled by most major Midwestern population centers.

This massive influx of residents back into the central business district no doubt contributed to an expanded service sector. Jobs data from the nineties shows that the service jobs in the city as a whole, which included both professional positions for new leisure-seeking urbanites and low-wage jobs in the entertainment economy, picked up much of the slack created by a still-declining manufacturing sector, not to mention a plateau in the local financial industry’s labor force (see Table 1.4). Of course, the quality of many of these new service jobs was open to debate, but this did not stop the Tribune

58 Chicago Central Area Committee, Chicago Central Area Plan Redraft (Chicago, 1984), 22, 26, Municipal Reference Collection, Harold Washington Library Center.

59 Commercial Club of Chicago, Make no Little Plans, 28. 43

from asserting in the early 2000s that the mayor had transformed Chicago’s downtown from a “rusting relic” to a “glistening asset” for both residents and visitors alike.60

Table 1.3. Downtown Population Change, Major Midwestern Cities, 1980-2000. Absolute Pct. Absolute Change Pct. Change Change 1990- Change 1990- City 1980 1990 2000 1980-90 2000 1980-90 2000 Chicago 50,630 56,048 72,843 5,418 16,795 10.7% 30.0% Cincinnati 2,528 3,838 3,189 1,310 -649 51.8% -16.9% Cleveland 9,112 7,261 9,599 -1,851 2,338 -20.3% 32.2% Columbus, OH 8,737 6,161 6,198 -2,576 37 -29.5% 0.6% Des Moines 8,801 4,190 4,204 -4,611 14 -52.4% 0.3% Detroit 46,117 38,116 36,871 -8,001 -1,245 -17.3% -3.3% Indianapolis 33,284 14,894 17,907 -18,390 3,013 -55.3% 20.2% Milwaukee 14,518 14,458 16,359 -60 1,901 -0.4% 13.1% Minneapolis 33,063 36,334 30,299 3,271 -6,035 9.9% -16.6% St. Louis 9,942 9,109 7,511 -833 -1,598 -8.4% -17.5% Source: Adapted from Birch (2005). Based on data from the U.S. Census.

Table 1.4. Number of Employees in Selected Industries, Chicago City, 1991, 1997 & 2001. Retail and Finance, Total (all Wholesale Insurance, Year industries) Manufacturing Trades Real Estate Services 1991 1,196,041 192,920 249,347 168,111 445,988 1997 1,172,901 154,507 227,407 167,378 502,653 2001a 1,247,473 131,967 231,705 170,017 553,282 % Chg. 91-97 -1.9 -19.9 -8.8 -0.4 12.7 % Chg. 91-01 4.3 -31.6 -7.1 1.1 24.1 Source: Department of Housing and Urban Development, State of the Cities Data Systems: County Business Patterns Special Data Extract. Data based on national business register of each known establishment in the U.S. (includes full- and part-time positions). a Because of the transition from the Standard Industry Classification (SIC) system to the North American Industry Classification System (NAICS) after 1997, the 2001 data represents estimates produced by the Census Bureau using a special NAICS-to-SIC bridge procedure. This means that the comparability between 1991 and 2001 (for specific industry counts) is less reliable than that between 1991 and 1997.

As hard as the second Daley worked to mimic other central city mayors in terms of downtown revitalization and the creation of a competitive leisure industry, he

60 David Axelrod, “10 Votes for Daley,” Chicago Tribune, February 23, 2003, ProQuest. 44

distinguished himself from leaders in other Rustbelt cities like Cleveland and Cincinnati by his indifference to using professional sport as a cornerstone of urban image rehabilitation.61 In fact, after the Chicago Bulls won their second championship in 1992,

Daley remarked that “it’s only a basketball game. It’s not going to change life.”62 There

are several possible explanations for Daley’s apathy. According to secondary accounts, he had a frigid relationship with Bulls owner Jerry Reinsdorf, who had allegedly made enemies of some of Daley’s friends in the local real estate industry.63 Perhaps the new

mayor also appreciated the economic ambiguity of linking local growth machines to the

sports business. Apart from claims that new subsidized sports complexes diverted

resources away from neighborhoods, many leaders inside the leisure industry questioned

their value to local growth coalitions. In fact, in 1996, representatives from national car-

rental agencies and other tourism-related industries traveled to several cities to lobby

against sports-related development projects, arguing that tourists could rarely obtain

tickets for premier teams.64 Finally, the fact that many of the professional sports facilities

in the city, especially Chicago Stadium (Bulls and Blackhawks) and Comiskey Park

(White Sox) sat in neighborhoods rife with poverty and crime probably made Daley

hesitant to showcase the teams.

Despite Daley’s indifference, the meteoric rise of the Bulls during the nineties

would ultimately prove, in the words of Spirou and Bennett, “the most effective

61 On other Midwestern mayors’ relationship to professional sport, see Kevin Delaney and Rick Eckstein, Public Dollars, Private Stadiums: The Battle Over Building Sports Stadiums (New Brunswick, NJ, 2003).

62 Richard Roeper, “A Few Final Thoughts on Bulls and Three Petes,” Chicago Sun-Times, June 22, 1993, NewsBank.

63 See Chapter 3.

64 Charles Euchner, “Tourism and Sports: The Serious Competition for Play,” in Dennis Judd and Susan Fainstein, eds., The Tourist City (New Haven, CT: Yale University Press, 1999), 222-223. 45

accidental public relations campaign ever mounted on behalf of the city of Chicago.”65

As soon as the Bulls reached their first NBA finals in 1991, the local media began to

situate Jordan and his teammates as the purveyors of a new urban identity that allegedly

erased the popular perception of Chicago as a disorderly Rustbelt relic. In this telling, it

was not the redevelopment of Navy Pier or Daley’s “greening” efforts that accounted for

the transformation of the city’s image in the eyes of outsiders. Rather, it was the Bulls,

and most especially Michael Jordan.

Throughout the nineties, the local media’s logic in labeling Jordan and the Bulls

as the “City’s Most Valuable Imagemaker[s]” followed a consistent pattern. First, the

press would acknowledge that Chicago had long suffered from a less than stellar

reputation, and that mention of the city outside of its borders was almost certain to elicit

references to machine politics and political corruption. As one Tribune writer eloquently

put it, what people remembered before the Bulls was “the Chicago that seemed to be

loosely controlled by a collection of competing barracudas masquerading as clowns.”

Usually, the narrative went on to suggest that the Bulls’ feats of athletic prowess had displaced this unflattering imagery with that of a legitimate winner. After the team’s second title in 1992, the Tribune followed the formula to a tee: “the river may leak, aldermen may be entrusted with the gate of the city…but at least we’ve got the Bulls…In the afterglow of the Bulls’ triumph, Second City takes on new meanings. Try Second-

Straight-Title-City. Second-to-None City.” Not surprisingly, after Jordan’s first retirement in 1993, the press anxiously pondered the potential consequences for

Chicago’s image. The Sun-Times’ compared the retirement to “waking up and finding a vacant lot where the Sears Tower used to be.” Of course, the papers took up the narrative

65 Spirou and Bennett, It’s Hardly Sportin’, 181. 46

again soon after Jordan returned in 1996. When the team captured its fifth ring in 1997,

one Tribune columnist pontificated, “because of moving pictures of large men in baggy

shorts bouncing off satellites, Chicago has a new and better image in the world. Not so

long ago, our town was known around the globe as Gangster City, synonymous with Al

Capone and gangland.”66

Indeed, more than anything else, the claim that Jordan had supplanted Capone as

the city’s most recognizable icon underwrote the media’s arguments about professional

basketball’s role in reconstituting the city’s image. An early example of this came a few

months after the Bulls’ first title in 1991, when Sun-Times columnist Irv Kupcinet

recounted the experience of a traveler from Chicago who, upon revealing his home city to

a customs agent in Grenada, was welcomed with “Ah, Chicago…Michael Jordan!”

Kupcinet rejoiced, seeing as how “Chicagoans visiting overseas invariably have been

greeted with the rat-a-tat-tat of a machinegun, evoking memory of the late and

unlamented Al Capone.” After the team’s second championship in 1992, the Tribune got

in on the action, crediting Jordan and the Bulls with having “buried the old-fashioned

image of Capone in many ways,” even though the paper conceded that the job was far

from finished, since in some “far reaches of the globe” the images of “speakeasies, the

Untouchables, [and] rat-a-tat-tat” still dominated. However, by the time the team had

amassed three straight championships, the local press seemed to believe that in most of

those far reaches, Capone had become an afterthought in comparison to Jordan and

company. In 1995, the Tribune asserted proudly that Jordan “has been able to forever

66 Madigan, “Michael: The City’s Most Valuable Imagemaker”; Steve Johnson, “Now the Real Fans Can Honor the Bulls,” Chicago Tribune, June 16, 1992, ProQuest; Richard Roeper, “Brightest Star Gone—Our Skyline is Dimmer,” Chicago Sun-Times, October 7, 1993, NewsBank; R.C. Longworth, “A Bull-Ish Change,” Chicago Tribune, June 14, 1997, ProQuest. 47

eradicate the long-standing and playfully dark international image of Chicago. For

decades saying ‘I’m from Chicago’ on foreign soil would occasion a mimed blast of machine gun fire and an ‘Al Capone!’ Now it elicits an ‘Aaaaah, Michael Jordan’. ”67

These odes to Jordan’s capacity to transform how outsiders viewed Chicago were

not isolated platitudes. Between 1991 and 2000, the Tribune, Sun-Times, and Crain’s

Chicago Business published no less than seventy articles that mentioned Jordan

superseding Capone as the city’s poster boy.68 Many of them simply regurgitated the

generic narrative, reminding readers that Chicago “no longer is Al Capone and machine

guns and a massacre in a garage…Chicago is Michael Jordan,” or thanking Jordan for

having “bumped off Al Capone as the worldwide symbol of our city.” In some cases, the

tone betrayed a profound sense of relief at no longer living in a city associated first and

foremost with a gangster. A Tribune piece from 1997 asserted approvingly that “the

city’s symbol is no longer a syphilitic Capone and his henchman but a stately

athlete…and his talented teammates.” Capone’s syphilis had apparently become a

sticking point for the media, as evidenced by another article in the Tribune the following

year which noted with satisfaction that Jordan had “forced cabdrivers in almost every

European country to stop mentioning the mass murderer and syphilitic psychopath Al

Capone.” While some of these pieces offered little in the way of empirical evidence that

Jordan had actually displaced Capone as the most iconic Chicagoan in the minds of

outsiders, others included anecdotes from the authors’ international travels as proof.

67 Irv Kupcinet, “KUP & Company,” Chicago Sun-Times, December 22, 1991, NewsBank; “Da Skit: What’s Da Big Deal?,” Chicago Tribune, February 17, 1992, ProQuest; Rick Kogan, “Dennis Rodman: A Chicago-Style Hot-Dog,” Chicago Tribune, October 8, 1995, ProQuest.

68 Count conducted using ProQuest and NewsBank searches. The Arlington Daily Herald, Chicago Defender, and State Journal Register all published similar articles as well. 48

From customs checkpoints in Grenada to toll booths in Bulgaria, the story was the same:

Locals learn that a visiting journalist hails from Chicago, and they burst out with their own version of, “Ahh, Cheecowgo! Cheecowgo Bools! Michael Jordan!” One Tribune

writer even recounted visiting a middle-school classroom in Italy where, to his

satisfaction, the children had never heard of Al Capone but blurted out “Michael Jordan”

when asked to name a famous Chicagoan.69

Given Daley’s blasé reaction to the Bulls, why did the local press spill so much

ink talking about Jordan “replacing perceptions of gangsters and hog butchers with

athletic wonderment?”70 One obvious explanation is that papers like the Tribune and Sun-

Times simply thought that the story helped sell papers. It makes sense not only that news

outlets tried to tap into the Bulls’ popularity to boost circulation, but also that local journalists felt a genuine compulsion to write about what the team signified for local residents. It would be silly to argue that the Jordan-Capone narrative was simply a coordinated effort by the local media to help retool Chicago’s international image in the service of politicians and business interests. However, to assume that the excitement drummed up by the media around the Bulls existed separate from prevailing pro-growth agendas would be equally shortsighted.

Despite their alleged roles as critics of local policy, major urban newspapers have had a serious investment in sanctioning and supporting urban elites’ strategies for maximizing growth. As geographer Briavel Holcomb noted in 1999, “newspapers remain

69 Rick Morrissey, “The Joy of Six Awesome Runs Appears to Be on Last Legs,” Chicago Tribune, June 15, 1998, ProQuest; Richard Roeper, “Jordan is Not Alone as Young Achiever,” Chicago Sun-Times, February 19, 1997, NewsBank; R.C. Longworth, “A Bull-Ish Change”; John Kass, “Michael Jordan Could Become Driving Force on Lakeshore Drive,” Chicago Tribune, May 4, 1998, ProQuest; Tom Hundley, “Feeling Constricted by Ties to the Mafia,” Chicago Tribune, April 19, 2001, ProQuest.

70 Jay Mariotti, “Chicago Owes You, Michael,” Chicago Sun-Times, December 19, 2000, NewsBank. 49

among those locally dependent business that, because they are relatively immobile, are

reliant on the health of the local economy for circulation and advertising.”71 In other

words, economic growth meant increases in population and firms, which in turn meant

wider circulation, which ultimately increased the demand for advertising space.72

Moreover, newspapers have not simply stood on the sidelines and waited for their circulation to increase; they have proactively marketed their respective cities as attractive destinations for investors, residents, and tourists. As Miriam Greenberg explains, local media in cities restructuring their economies away from manufacturing and towards service and leisure have aimed to “overhaul the total image and reputation of a given city, and to impose this hegemonic vision as widely and strategically as possible.”73 Moreover,

urban press outlets are under no obligation to prioritize image-building strategies in the

same order as local mayors. According to Logan and Molotch, metropolitan newspapers

“take a broad responsibility for general growth machine goals,” and they may take it

upon themselves to innovate in the field of place promotion.74

By seizing on—some might say, manufacturing—Jordan’s succession of Capone

as the face of Chicago, mainstream newspapers like the Tribune and Sun-Times took the

lead in an opportunistic urban branding campaign that existed alongside the Daley

administration’s more conventional promotional strategies, which focused on showcasing

assets like Navy Pier and the Chicago Symphony Orchestra. For the press, this was a

71 Briavel Holcomb, “Marketing Cities for Tourism,” in Dennis Judd and Susan Fainstein, eds., The Tourist City (New Haven, CT: Yale University Press, 1999), 66.

72 Of course, this characterization has become increasingly antiquated as print newspapers are supplanted by the internet.

73 Greenberg, Branding New York, 36.

74 Logan and Molotch, Urban Fortunes, 70. 50

low-risk, high-reward endeavor. An expensive urban rebranding campaign centered on a

professional sports team could backfire quickly for a city’s tourism bureau, as one bad

season might rob the promotion of its luster. In this regard, Daley acted rationally in more

or less ignoring the Bulls. A newspaper, on the other hand, could quickly translate a

championship franchise into a powerful civic symbol and simply move on once the

winning stopped, without worrying too much about costs.

In the case of the Bulls, the papers hit the branding jackpot since the dynasty

spanned the better part of the decade. Moreover, Jordan and his teammates emerged as

willing pitchmen for the campaign. In his comments to the press after announcing his

second retirement from the Bulls in 1999, Jordan embraced his role as savior of the city’s

identity. “I tried to step on the basketball court and get rid of the gangster mentality that

Chicago was known for for a long time,” he remarked. “I think successfully, myself and

my teammates and the whole organization has made an effort to change the perspective

about Chicago.”75 A few years earlier, the Bulls’ always eccentric rebound specialist

Dennis Rodman affirmed the team’s status not simply as a positive civic mascot, but also

as a bona fide tourist attraction, insisting that “people look at the Bulls like they look at a

historical landmark.”76

To be sure, journalists from the major papers did not convene to strategize about

using Jordan and the Bulls to market the new Chicago, and they had no master plan for

doing so. Taken together, however, their work constituted a fortuitous public relations

75 “Michael Jordan Retirement Press Conference,” NBA.com, January 13, 1999, http://www.nba.com/jordan/transcript.html.

76 Jack McCallum, “A Cut Above,” Sports Illustrated, March 10, 1997, http://sportsillustrated.cnn.com/features/1997/yearinreview/magazine/bullsMcCallum.html.

51

strategy that capitalized on the unpredictable ascent of a local team. By playing up Jordan

and the Bulls as Chicago’s new, friendlier ambassadors, the local papers did their part to

finally fulfill a longstanding fantasy of downtown elites. Almost a decade before the

Bulls won their first title, a report issued by the Chicago Central Area Committee had

called for a task force “to study the need for developing a symbol that represents the spirit

and unity of Chicago…[and] the role and effect a symbol such as a monument could have

in promoting the city.” 77 Daley preferred to counter the gangster references by pointing

out Chicago’s historic architecture or the world-class collection at the Art Institute, and perhaps these plugs for local landmarks made an impression on outsiders. But the Bulls offered much more in the way of image rehabilitation. Jordan’s charisma and the meteoric rise in the global popularity of the NBA during the 1980s and 1990s meant that

Chicago ultimately captured the attention of the rest of the world most often by virtue of its newfound status as a basketball Mecca, not because Daley planted a bunch of trees. In

1997, the Tribune outlined the bigger picture, noting that “the Bulls have accomplished

what years of civic boosterism, expensive advertising campaigns and foreign promotions

failed to do. They have turned the toddling town’s image from that of a gun-toting city of

gang wars and bootleggers to that of the world capital of slam dunks.” 78

This is not to say that the more mundane efforts at urban rebranding emphasized

by Daley didn’t matter. Instead, the Bulls’ value as a marketing tool for Chicago’s growth

machine derived from the accidental convergence of the team’s unprecedented success

with the intense desire on the part of growth machine constituents like the local media to

77 Chicago Central Area Committee, Chicago Central Area Plan (Chicago, 1983), no page number, Harold Washington Library Center Municipal Reference Collection.

78 Longworth, “A Bull-ish Change.” 52

project a new and improved civic identity. Even if some elites were hesitant about depending on sport to convince outsiders to come spend their money in Chicago, the fact that Jordan and his supporting cast arrived when they did resulted in an incredible synergy between the pro sports business and a post-industrial growth coalition bent on profiting from a local reputation unhindered by the specter of Capone. The media’s use of the Bulls was not the sort of pre-engineered urban marketing campaign described by

Miriam Greenberg in her history of the “I ♥ New York” initiative, but in the end it may have proved just as—if not more—effective.

That Jordan’s identity as an urban image-builder was more than just the wishful

thinking of some local sportswriters became clear as newspapers far removed from

Chicago reported on MJ’s status as the city’s most famous son. In 1997 the Italian paper

La Stampa informed its readers that Jordan had emerged as “the new king of Chicago,

now richer and more famous than even Al Capone.” After Jordan’s second retirement

from the Bulls in 1999, Spanish Newswire Services, which provides copy to Latin

America and Spain, ran an article entitled “Jordan Robs Capone of Preeminence.” The

article, referring to Jordan as the “star savior” of Chicago, noted that his “dominance has allowed Chicago to leave behind its identity as the city of Al Capone and assume the title of the capital of the best basketball player of all time.” El Pais, one of Spain’s most widely circulating dailies, printed an article the following year which confirmed that, “for the entire world, Jordan has displaced the old tandem of Chicago/Capone.”79 Perhaps

foreign journalists merely aped what they had read in the Chicago papers, but either way

79 Giorgio Viberti, “Jordan, ti ricordi de me?,” La Stampa, October 15, 1997 LexisNexis; Enrique Barcia, “Jordan le robo el protagonismo a Al Capone,” Spanish Newswire Services, January 12, 1999, LexisNexis; El Pais, “Una Pacifica Division Racial,” September 3, 2000; LexisNexis. All translations by author.

53

outsiders seemed to agree that Jordan and the Bulls had radically reshaped the city’s

image.

Regardless of its geographical reach, all of this chatter about MJ and his

teammates altering popular perceptions of Chicago took place squarely within the realm

of discourse. One has to wonder if the popularity of the Bulls and efforts to translate this

popularity into a new urban “brand” provided an actual boost for Chicago’s economy.

For example, did the emphasis on Jordan as the city’s new ambassador actually lure more

visitors?

As several scholars have pointed out, growth in local tourism sectors depends on

appealing to potential visitors through the marketing of both symbolic images and

identifiably unique entertainment infrastructure (i.e. products or experiences).80 Some empirical evidence exists to support the claim that the tourist infrastructure piece is an important correlate of urban economic growth, but we simply lack the data to quantify how much the image capital provided by sports teams affects visitors’ decision-making process.81 Without detailed survey or focus group data from the nineties, it’s hard to

know with any precision to what extent the Bulls brand influenced visitors’ decisions

about coming to Chicago. However, the press consistently provided anecdotal evidence

that Jordan and company were not only nudging travelers towards Chicago as a result of their symbolic value, but also in terms of the various opportunities that visitors had to

“experience” the Bulls first-hand. While far from comprehensive, this evidence suggests

80 See Dennis Judd, “Promoting Tourism in US Cities,” Tourism Management 16, no. 3 (1995): 175-187; Andrew Smith, “Sporting a New Image?: Sport-Based Regeneration Strategies as a Means of Enhancing the Image of the City Tourist Destination,” in Sport in the City: The Role of Sport in Economic and Social Regeneration, ed. Chris Gratton and Ian Henry, 127-148 (New York, NY: Routledge, 2001).

81 See Mark Rosentraub and Mijin Joo, “Tourism and Economic Development: Which Investments Produce Gains for Regions?,” Tourism Management 30 (2009): 759-770.

54

that the Tribune was not entirely exaggerating when it asserted in 1999 that “Jordan had

become [the city’s] biggest tourist attraction, our Eiffel Tower, our Graceland. He

has…filled hotel rooms, filled shopping bags, filled our egos.”82

One of the first indications that professional basketball was actually attracting

visitors to the city came after the Bulls erected a statue to honor Jordan outside of the

United Center, the team’s new arena, which opened on the Near West Side in the summer

of 1994. The Tribune noted in November of that year that the bronze statue of “His

Airness” was “drawing visitors and residents alike to the West Side to pay homage to the

larger-than-life basketball icon.” And though the article was short on examples, the Sun-

Times followed up not long after with a report that “tourists from as far away as

Thailand…[had] posed for pictures by the illuminated icon, as fans tossed coins…near the base.” In 1997, a tourist from Mexico taking pictures in front of the statue told the

Tribune that he wanted “a memento, something to show our son or grandchildren we were here.” And the statue was not the only Bulls-related landmark luring Chicago sightseers. Michael Jordan’s Restaurant, a downtown Jordan-themed eatery, also served as a magnet for Bulls-crazed visitors. In 1997, a few years after the restaurant opened, the

Tribune reported that tourists from Hawaii, the Philippines, and Europe regularly risked

their lives by standing in the middle of LaSalle Street just so they could snap a photo

capturing the entire length of the massive painting of Jordan on the building’s façade.

Jose Luis Martinez, a sightseer from Valencia, Spain who had come up short when he

tried to score Bulls tickets, explained to the awed reporter, “we heard [the restaurant] was

one of the few things you had to do in Chicago…The mecca is the stadium, but if you

82 Rick Morrisey, “Jordan Had Rare Air for the Dramatic in Chicago,” Chicago Tribune, January 13, 1999, ProQuest. 55

can’t go there, you must come here.” In some cases, though, these attractions simply

could not make up for missing an actual game. In 1998 the Sun-Times described

convention-goer Alayda Linares as “heartbroken because the only thing[s] she really,

really wanted to see” were the Bulls and Jordan.83

Unlike Martinez and Linares, many Bulls-crazed tourists made sure they had tickets before they arrived in Chicago. A 44-person tour group from Japan came to the city explicitly to attend Games 1 and 2 of the 1996 NBA finals at the United Center. The tour cost a minimum of $4,000, and it was not an isolated occurrence; by the mid-nineties tour companies had started organizing these basketball getaways throughout the regular season. Hiromi Karasawa, a tour guide for one such company, told the Sun-Times that

“the airfare was cheaper than the (game) tickets.” Asia was just one of the places from which foreign fans began their pilgrimage to the United Center. Nimrod Armen, an

Israeli teenager, traveled to Chicago all the way from the Middle East in 1996 just to see

Jordan and the Bulls after receiving game tickets as a bar mitzvah present. Americans from outside of the Midwest also made the trek for the sole purpose of seeing a game.

Chicagoan Bruce Woodward told the Tribune in 1997 that he had “friends in San Diego who came up a few months ago to see a Bulls game and all they wanted to do was take their pictures next to that [Jordan] statue.”84 As these anecdotes convey, some visitors

83 Steve Rhodes, “Even in Bronze, Jordan Spirit is a Real Magnet,” Chicago Tribune, November 7, 1994, ProQuest; Richard Roeper, “United Crowd Just Happy to Be There,” Chicago Sun-Times, March 26, 1995, NewsBank; John Husar, “Jordan’s Statuesque Presence Draws Thousands to Pregame Pilgrimage,” Chicago Tribune, May 29, 1997, ProQuest; Dave Newbart, “Jordan’s Now the Big Splash for Tourists,” Chicago Tribune, November 3, 1997, ProQuest; Philip Franchine, “City Wows Big Shots of Travel Trade,” Chicago Sun-Times, May 24, 1998, NewsBank.

84 Phil Rosenthal, “Tour Group Has Quite a Yen to See Jordan,” Chicago Sun-Times, June 6, 1996, NewsBank; Bob Secter, “Legend Grows Around the Globe,” Chicago Tribune, June 17, 1996, ProQuest; Husar, “Jordan’s Statuesque Presence Draws Thousands.” The popularity of the statue with tourists has apparently continued even in the wake of Jordan’s departure from Chicago. In 2009, the Tribune’s K.C. 56

came to Chicago expressly to see the Bulls. Perhaps they made the rounds at other

popular sightseeing locations also, but Jordan and company were priority number one.

These sports tourists no doubt made up a minority of visitors to Chicago during

the nineties, but other travelers with more eclectic leisure interests often came to the city

knowing little more about it than its status as the hub of American professional

basketball. In the summer of 1999, for example, the Yurukoglu family came to Chicago

for vacation all the way from Turkey having almost no knowledge of the city, save what

they had seen and heard of “the Chicago Bulls, the wind and the skyscrapers.” The family spent much of their trip visiting museums and the lakefront, but according to the Tribune the Bulls played some sort of role in getting them there in the first place. It is unlikely that the Yurukoglus were an isolated example. By the late nineties, Chicago and the Bulls were synonymous in the minds of many inside and outside of the U.S. As the Japanese ambassador to the U.S. told the Sun-Times in 1998, Michael Jordan came to mind first for most people in Japan whenever someone mentioned Chicago.85 As non-Chicagoans

pondered where to take their next trip or hold their next convention, the association likely

operated in the opposite direction as well (i.e. their familiarity with Jordan and the Bulls led them to think of Chicago when deciding on a destination).

As much as the Daley administration shied away from making the Bulls a part of its official marketing plan for Chicago, some local officials corroborated journalists’

Johnson reported that, during a single hour of loitering around the statue, he encountered tourists from Miami, New Jersey, San Diego, Spain, Germany, Finland, Italy, and Hong Kong. K.C. Johnson, “The United Center and the Statue Become Ground Zero for a Socioeconomic Renaissance,” Chicago Tribune, September 10, 2009, ProQuest.

85 Charles Leroux, “Foreign Legion: Millions of International Travelers Visit Chicago Every Year,” Chicago Tribune, August 11, 1999, ProQuest; Robert Manor, “Tall Buildings and MJ: What Chicago means to Japanese,” Chicago Sun-Times, June 21, 1998, NewsBank.

57

arguments about the team as an unequivocal publicity boon. By the time the Bulls had

netted their third NBA title, the Chicago Office of Tourism acknowledged that it was

receiving hundreds of letters requesting literature about the Bulls. In 1998, the city’s

acting Tourism Director Dorothy Coyle admitted embarrassment after realizing that many

foreign writers invited to Chicago knew much more about the Bulls than about the city’s

more conventional cultural attractions like the Art Institute. “The Bulls, and specifically

Michael Jordan, have absolutely had a positive impact on the image of the city of

Chicago worldwide,” Coyle remarked, and she even revealed that the official tour

coordinated by the city for the international journalists included stops by the Jordan

Statue at the United Center.86 The program designed and distributed to the journalists by

the Chicago Office of Tourism used MJ and the Bulls as bait for potential downtown

shoppers, urging the city’s guests to “visit Niketown, outfitter of the world’s greatest

athletes, including Chicago Bulls superstar Michael Jordan.”87 State officials from

Illinois, which earmarked some of its own tourism budget for promoting Chicago, also

felt compelled to use the Bulls to promote the city to outsiders. By the late nineties, they

had started using state money to fund TV ads hyping the city during nationally syndicated

Bulls telecasts.88

Taken together, the anecdotal evidence provided by journalists, city officials, and travelers suggests that professional basketball played a crucial role in promoting the

86 Shirley Leung, “Caution to the Wind,” Chicago Tribune, July 6, 1993, ProQuest; “City’s Favorite Landmarks: Anything M.J.,” Arlington Daily Herald, June 3, 1998, ProQuest.

87 Chicago Office of Tourism, Passport to Chicago: 1998 Chicago Sightseeing Tours, pamphlet (Chicago, 1998), Municipal Reference Collection, Harold Washington Library Center.

88 Jim Kirk, “Downstate Promoted at Chicago’s Expense,” Chicago Sun-Times, February 1, 1996, NewsBank.

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city’s image at a moment of heightened stakes in interurban competition for visitor

spending. And the stakes were indeed high. According to data from the World Travel and

Tourism Council, spending on leisure travel and tourism in the U.S. rose from $196

billion to $395 billion between 1989 and 1999 (growth of over 60% when measured in

constant dollars).89 By 1992, tourist-intensive industries like hotels, amusement and recreation, and eating and drinking establishments accounted for nearly 20% of business sales in the U.S.90 Vying for increased shares of the national and international tourist

industries made good sense for mayors like Richard M. Daley, not only since tourists

tend to spend more than local consumers, but also because developers of tourist-intensive

firms like restaurants and entertainment complexes often prefer the aesthetic cachet of the central city to drab suburban settings. Moreover, as Susan Fainstein and Robert Stokes explain, tourism, “unlike most consumer services production, is an export industry and therefore contributes directly to growth of the economic base.”91 In other words, tourism

draws new money into urban economies from elsewhere, promoting consumer spending

above and beyond the purchasing power of local residents. If “growth” continued to be the name of the game in urban governance, cities ignored tourism at their own peril.

Michael Jordan’s Bulls gave Chicago a leg up in competing for this new spending by supplying a promotional icon both utterly unique and broadly marketable. John

Hannigan notes that during the eighties and nineties many cities with hopes of tapping

89 World Travel Tourism Council, “Leisure Travel and Tourism Spending,” Economic Data Search Tool, http://www.wttc.org/research/economic-data-search-tool/.

90 Jason Bram, “Tourism and New York City’s Economy,” Federal Reserve Bank of New York: Current Issues in Economics and Finance 1, no. 5 (October 1995), 4.

91 Hannigan, Fantasy City, 107; Susan Fainstein and Robert Stokes, “Spaces of Play: The Impacts of Entertainment Development on New York City,” Economic Development Quarterly 12, no. 2 (May 1998): 150-151. 59

into the urban entertainment market by “differentiating themselves on the basis of distinctive fantasy themes” actually ended up creating rather unremarkable sets of attractions that differed little in substance from the first generation of “urban entertainment districts” in places like Baltimore and Boston.92 The degree to which attractions like Navy Pier simply replicated what had already been done in other cities is open to debate, but we know for certain that no other city could claim ownership over the most successful NBA franchise of the decade and the most popular athlete since

Muhammad Ali. Jordan was one of a kind, and media boosters intelligently exploited the city’s monopoly over its status as home to “His Airness” and the rest of the Bulls.

The larger effort to rebrand Chicago as a magnet for visitors appeared to have paid off for the city on several fronts by the end of the century. In the first place, more people were visiting Chicago. As Terry Nichols Clark and colleagues report, between

1993 and 1997 the number of tourists visiting the city jumped from 32 to 42.9 million.93

The city’s Office of Management and Budget estimated that between 1993 and 1999, combined annual attendance at the various festivals hosted by the city—about a quarter of which consisted of tourists in any given year—shot up from 4 million to over 10 million (see Table 1.5). More conventional economic indicators also painted a glowing picture. Data compiled by Chicago Metropolis 2020, a leading local civic group, reveals that, between 1989 and 2000, the tourism industry trailed only business services and software in terms of average annual employment growth rate in the Chicago metropolitan

92 Hannigan, Fantasy City, 4.

93 Terry Nichols Clark, et al, “Amenities Drive Urban Growth,” Journal of Urban Affairs 24, no. 5 (Winter 2002): 504.

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region.94 The Illinois State Economic and Fiscal commission estimated that the city’s

tourism sector accounted for nearly $15 billion in local economic activity by the end of

the century, trumped only by New York, Las Vegas, and Orlando.95 While different

estimates of the total economic impact of tourism and entertainment in Chicago during

the 1990s varied widely—a result of different geographic definitions and economic multiplier models—even conservative figures placed it at several billion dollars annually, and both journalists and academics celebrated the fact that, by the mid-1990s, urban leisure had emerged as one of the city’s fastest growing sectors.96

Table 1.5. Estimated Combined Festival Attendance, Chicago City, 1993-1999. Combined Festival Tourists as Percentage of Attendance (millions) Attendees 1993 4 23% 1994 6.5 26% 1995 7.5 27% 1996 8.1 26% 1997 9.4 n/a 1998 9.7 n/a 1999 10.1 n/a Source: Official estimates from City of Chicago, Program and Budget Summary (1994-2000).

Admittedly, one has to be cautious about overstating the impact of the leisure

economy on economic growth in cities like Chicago during the nineties.97 Tables 1.6 and

1.7 reveal that while over the course of the decade tourist- and leisure-intensive industries

94 Chicago Metropolis 2020, Regional Economy (Chicago, IL, 2002), 3.

95 Illinois Economic and Fiscal Commission, McCormick Place Expansion and the Illinois Tourism Industry (Chicago, IL, 2002), http://cgfa.ilga.gov/Upload/mccormick_place2002.pdf, 3.

96 For the conservative pole of the estimates, see Jim Kirk, “City Seeks Plan to Boost Tourism,” Chicago Sun-Times, February 1, 1996, NewsBank. For the other side of the spectrum, see Francine Knowles, “30 Million Chicago Visitors in 1999,” Chicago Sun-Times, September 5, 2000, NewsBank.

97 For a general critique of overestimation of the economic impact of the “culture industry,” see Doug Henwood, After the New Economy (New York, NY: The New Press, 2003).

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like “amusement and recreation” posted impressive numbers in terms of percentage growth in firms and jobs, they still accounted for a relatively small fraction of economic activity compared to other parts of the service sector.98 Moreover, by the end of the decade the tourism industry in the Chicago region was still considerably smaller in terms of direct economic impact than declining sectors like manufacturing.99 Service sectors such as “engineering and management” (which includes research & development), social services (which includes non-profits), and business services expanded much more impressively in absolute terms, bearing out the conclusion of political scientists Dick

Simpson and Tom Kelly that by the end of the twentieth century Chicago’s economy proved more nuanced than terms like “leisure-oriented” or “service” could capture.100

98 The apparent stagnation in the hotel industry shown in the tables likely reflects the fact that in the early eighties the industry found itself overbuilt. New investment and construction, according to local news reports, appears to have resumed by the late nineties. See J. Linn Allen, “Chicago’s Inns Burst Out of Overbuilt Slump,” Chicago Tribune, February 21, 1997, ProQuest.

99 Chicago Metropolis 2020, Regional Economy Report. Another potential problem with grandiose claims about the impact of increased tourism spending, particularly in the context of spectator sports, is what economists refer to as “leakage” effects in which dollars spent by tourists on tickets, etc. end up in the hands of players and owners who do not make their home in the local area. In these cases, large portions of spending may effectively “leak out of the local economy.” See John Siegfried and Andrew Zimbalist, “The Economics of Sports Facilities and Their Communities,” Journal of Economic Perspectives 14, no. 3 (Summer 2000): 106.

100 Dick Simpson and Tom Kelly, “The New Chicago School of Urbanism and the New Daley Machine,” in Dennis Judd and Dick Simpson, eds., The City Revisited: Urban Theory From Chicago, Los Angeles, New York (Minneapolis, MN: University of Minnesota Press, 2011), 215. 62

Table 1.6. Establishments in Select Service Industries Chicago City, 1991, 1997 & 2001. “Tourist-Intensive” Industries

Engineer- Eating ing and Amuse- Hotels and Services Personal Business Manage- Social ment and and Drinking Year (total) Services Services ment Services Recreation Lodging Placesb 1991 21,030 1,561 3,741 2,344 1,124 514 224 4,440 1997 23,954 1,587 4,521 3,109 1,655 626 210 4,797 2001a 23,969 2,055 4,328 3,898 1,832 798 207 4,685 % Chg. 91-97 13.9 1.7 20.9 32.6 47.2 21.8 -6.3 8.0 % Chg. 91-01 14.0 31.6 15.7 66.3 63.0 55.3 -7.6 5.5 Source: Department of Housing and Urban Development, State of the Cities Data Systems: County Business Patterns Special Data Extract. Data based on national business register of each known establishment in the U.S. a Because of the transition from the Standard Industry Classification (SIC) system to the North American Industry Classification System (NAICS) after 1997, the 2001 data represents estimates produced by the Census Bureau using a special NAICS-to-SIC bridge procedure. This means that the comparability between 1991 and 2001 is less reliable than that between 1991 and 1997. b “Eating and Drinking Places” technically falls under the “Retail Trade” industrial classification.

Table 1.7. Employees in Select Service Industries, Chicago City, 1991, 1997 & 2001. “Tourist-Intensive” Industries

Engineer- Eating

ing and Amuse- Hotels and

Services Personal Business Manage- Social ment and and Drinking Year (total) Services Services ment Services Recreation Lodging Placesb 1991 445,988 12,378 95,186 58,246 23,603 8,659 19,399 65,118 1997 502,563 12,826 118,770 57,897 33,610 10,580 16,447 71,726 2001a 553,282 22,289 139,315 72,612 41,207 22,468 19,062 76,995 % Chg. 91-97 12.7 3.6 24.8 -0.6 42.4 22.2 -15.2 10.1 % Chg. 91-01 24.1 80.1 46.4 24.7 74.6 159.5 -1.7 18.2 Source: Department of Housing and Urban Development, State of the Cities Data Systems: County Business Patterns Special Data Extract. Data based on national business register of each known establishment in the U.S. a Because of the transition from the Standard Industry Classification (SIC) system to the North American Industry Classification System (NAICS) after 1997, the 2001 data represents estimates produced by the Census Bureau using a special NAICS-to-SIC bridge procedure. This means that the comparability between 1991 and 2001 is less reliable than that between 1991 and 1997.

Even if impact studies quoted by urban boosters tended towards overstatement, the admittedly crude statistics in these tables tell us little about whether or not the successful marketing of the city and its leisure economy had significant secondary effects that went beyond boosts in tourism spending. Chicago’s economic and political elites

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valued vibrant cultural and entertainment infrastructures not simply because they attracted visitors, but also because they allegedly provided an incentive for young middle-class professionals to relocate to central cities, particularly in and around downtown areas. According to some policymakers and academics, a happening urban core would promote growth by luring college-educated professionals with the potential for high productivity, earnings, and consumption back to the metropolis that their parents had abandoned. If, as Nichols Clark and others argue, “citizens in the postindustrial city increasingly make quality of life demands, treating their own location as if tourists,” then it stands to reason that some of those who moved to Chicago during the 1990s to take jobs in booming service sectors like marketing and research & development put a lot of stock in new symbolic and cultural assets like the Bulls.101 The showcasing of these assets may have functioned as an important, if immeasurable, draw for many new

Chicagoans.

Urban sociologist Richard Florida, known best for his theory that economic growth in post-industrial urban centers has depended in large part on innovation driven by dense concentrations of “creative” professionals, rejects these sorts of hypotheses.

According to him, “in dozens of focus groups and countless interviews, not one Creative

Class person ever mentioned being drawn to a city for the professional sports teams it offers.” Moreover, he implies that spectator sports (as opposed to participant sports) constitute typically working-class leisure pursuits rather than attractive activities for the types of new urban consumers coveted by city planners. As a result, he laments public investment in sports infrastructure as a silly waste of taxpayer money.102

101 Clark et al, “Amenities drive urban growth,” 493.

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It’s true that public funding of stadiums and arenas has invariably proven a cost- benefit catastrophe for cities, but Florida is wrong to assume based simply on his focus groups that professional spectator sport had minimal appeal for mobile, “creative” professionals at the end of the twentieth century. As Chapter Two shows in detail, national survey data and trade publications from the market research industry reveal that fans who attended sporting events at the end of the twentieth century were considerably wealthier and better educated than those who did not (and that, if anything, these gaps were increasing). Moreover, in 1990s Chicago, demand for Bulls tickets boomed among professionals, corporate executives, and even celebrities. In other words, if one argues that Chicago’s emergence as a premier destination for young, high-earning professionals had to do with its re-branding as a hub of urban leisure, it makes little sense to assume that this larger process had nothing to do with the symbolic cachet and concrete entertainment experiences offered by sports “assets” like the Bulls.

This is not to say that we should accept the broader argument that cultural amenities like sports teams have driven recent urban growth. As Spirou warns, such a thesis entails serious “causality issues.” In particular, it’s possible that the growth of leisure infrastructure is actually the outcome of increased local consumption expenditures resulting from the expansion of certain types of employment independent of the urban amenities offered by the location in question.103 Instead, the point here is that, for

102 Richard Florida, The Rise of the Creative Class: And How It’s Transforming Work, Leisure, Community and Everyday Life (New York, NY: Basic Books, 2002), 175, 303. For a discussion of the “creative class” theory in the context of post-industrial Chicago, see Larry Bennett, “Community Power Applied: Chicago’s Engagement with 21st Century Globalization,” Sociological Imagination 42, no. 2 (2006): 65-82. For an empirically-based critique of Florida’s theory, see Hoyman and Faricy, “It Takes a Village.” For a critique of Florida’s take on spectator sports’ role in generating growth, see Mark Rosentraub, Major League Winners: Using Sports and Cultural Centers as Tools for Economic Development (Boca Raton, FL: CRC Press, 2010).

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boosters already enamored of leisure-centric growth strategies, using sports as a an urban marketing tool had an understandable appeal.

Of course, few on either side of this debate would argue that, on its own, the cachet of the Bulls and the unprecedented demand for tickets were enough to encourage

corporations or their prospective employees to remain in or move to Chicago. As

economist Mark Rosentraub explains, core considerations like local availability of a

trained workforce, the cost of labor, and existing indrastructure invariably trump the

availability of leisure assets like sports teams when businesses make locational decisions.

He adds, however, that surveys of business leaders suggest that “when several areas

satisfy a corporation’s cost calculus, the professional sports teams and other quality-of-

life features may well be the factors that ultimately determine a final locational choice.”104 If this proved true in some cases, it may have had to do with the abstract

appeal of being associated with a “big-league city,” or with a firm’s belief that a vibrant culture of sports spectatorship made it likelier that talented professionals would locate in

a particular city.105 Gerald Roper, president of the Chicagoland Chamber of Commerce,

surely had these sorts of mechanisms in mind when in 1998 he told a reporter from the

Chicago Defender that, “if Michael decides to retire, the only job he should have is mine

and I’m willing to give it up to Michael Jordan.” “We can’t measure the intangibles,”

103 Spirou, Urban Tourism and Urban Change, 151.

104 Mark Rosentraub, Major League Losers: The Real Cost of Sports and Whose Paying for It (New York, NY: Basic Books, 1997), 176, 173, 171-176.

105 Rosentraub, 171. Admittedly, systematic data to support such a theory is in short supply. In fact, despite the publication of numerous articles in recent decades, economists have been unable to isolate the factors which play the most important roles in firms’ locational decision making. As Terry Buss points out, studies on the topic are plagued by variation across industries, the unreliability of survey data (esp. when completed by subordinates unable to get inside the head of executives), as well as the differential weighting of factors depending on what stage of the decision-making process executives are in. See Terry Buss, “The Effect of State Tax Incentives on Economic Growth and Firm Location Decisions: An Overview of the Literature,” Economic Development Quarterly 15, no. 1 (February 2001): 90-105. 66

Roper continued, “[we can’t measure] what Michael Jordan has done for our city and our

region.”106

It’s worth reiterating here that, for people like Roper, the appeal of an urban re- branding campaign anchored by the Bulls had much to do with the fact that it was incredibly low-risk in terms of capital investment. What mattered most to the effectiveness of the campaign was not the construction of a new arena or luring a new

NBA franchise to the city, but rather the spectacular popularity of the team itself. As long as Jordan and his teammates continued their winning ways, the media and local officials could ride their coattails more or less for free. In other words, any benefits in terms of drawing visitors, residents, or corporations were effectively a bonus above and beyond those created by other promotional schemes. So, even if, as economists Roger Noll and

Andrew Zimbalist suggest, there is “no systematic evidence” that businesses think about the local sports scene when making locational decisions, local boosters had very little to lose in aggressively hawking the Bulls as ambassadors of the new Chicago.107

It’s absolutely true that this immeasurability presents a real problem in terms of

evaluating the impact of the Bulls on Chicago’s recent history of growth. That said, the

bits and pieces of evidence we do have suggest that Roper’s comment was more than

shoot-from-the-hip hyperbole. Corporate and political elites on the outside looking in

seemed genuinely taken by both the symbolic and experiential value of the Bulls. For

example, by 1998 the Japanese ambassador to the U.S. was insisting that Jordan and the

106 Chinta Strausberg, “Jordan Has ‘Buried’ Al Capone Image,” Chicago Defender, June 17, 1998.

107 Emphasis added. Noll and Zimbalist, like Rosentraub, acknowledge that “several business leaders have openly stated that they consider the status of major league sports when making such decisions,” but emphasize that beyond this the evidence is thin. Roger Noll and Andrew Zimbalist, “Economic Impact of Sports Teams and Facilities,” in Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums, ed. Roger Noll and Andrew Zimbalist, 55-91 (Washington, D.C.: Brookings Institution Press, 1997), 73. 67

Bulls, not Capone and the gangsters, were the first things that came to mind among

Japanese when someone mentioned Chicago. This was quite a turnaround, considering

that, in a 1985 article on a good-will visit to Japan by then Illinois governor James

Thompson, the Tribune printed blurbs from Japanese businessmen who complained that

the “Japanese fear Chicago because they hear so much about the crime, the gangsters and

the awful weather;” and that they hesitated to do business in the city because of its

“terrible image problem in Japan.”108 The radical shift in perspective indicated by such

anecdotes suggests that the Bulls brand could temper negative stereotypes about Chicago

that circulated among those in positions to influence investment decisions, and reinforce

the notion that Chicago was a distinctively positive place to do business.

According to some, an invitation to an actual game also went a long way with

potential investors. In 1986, after Jordan had already created a stir of excitement around

the team, local investment banker David Chamberlain told the Sun-Times, “there’s

always a clamoring for tickets by my clients. I’ve seen three games…My clients loved it.

These are all successful, wealthy guys and a lot of them still play basketball.” More than

a decade later, after the Bulls had won their sixth NBA title, Jeffrey Taylor, chairman of

Wheeling’s Cole Taylor Bank, told Crain’s Chicago Business that his luxury box rental

at the United Center gave him “a way of entertaining clients” and that even “if it’s not a

great game, it’s still fun to mingle.”109 Reflecting in 2000 on the role of Bulls games in promoting business deals, one local journalist noted:

108 Ronald Yates, “Chicago’s Image No Help to Thompson in Japan,” Chicago Tribune, March 21, 1985, ProQuest; Ronald Yates, “Chicago Fights Image Problem in Japan,” Chicago Tribune, March 25, 1985, ProQuest; Robert Manor, “Tall Buildings and MJ: What Chicago Means to Japanese,” Chicago Sun-Times, June 21, 1998, NewsBank.

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During the Jordan Age, some business executives from Chicago were known to strategically plant Bulls tickets inside the pocket of their day planner. Then, when the executive opened the leather folder to check a date, the prospective client from Prague or Bangkok would glimpse the shiny Bulls tickets and realize they must be dealing with a powerful businessman. The foreigner would immediately agree to whatever deal was on the table, just on the chance that one day they might be taken to a Bulls game.110

In this way, the immense popularity of the Bulls functioned as a “lubricant” for local

investment, providing a telling example of how, in Sharon Zukin’s words, “culture aids

the transactions of highly mobile, sophisticated business elites.”111

Ultimately, the history of the Bulls’ symbolic value to Chicago during the nineties

offers important lessons for understanding not only the role of the professional sports

business in a new urban economy, but also the complex and unpredictable shape taken by

urban growth coalitions at the end of the twentieth century. As Greenberg explains, while

in recent decades municipal officials have devoted considerable resources to urban

branding campaigns, many cities have benefited just as much from unplanned exposure

through mass media forms like television shows and movies. In theory, these “secondary

representations” of a city can provide big benefits to pro-growth coalitions, provided that

the representations place the locale in a positive light.112 Jordan and the Bulls functioned

as the ultimate “secondary” urban branding campaign, projected into the popular

109 Bob Sakamoto, “Bulls Convert Fast Start Into Ticket Sales,” Chicago Sun-Times, November 26, 1986, NewsBank; Jeff Borden, “Bulls Play Defense at Ticket Office,” Crain’s Chicago Business, May 17, 1999, ProQuest.

110 Chuck Goudie, “With Michael Gone, Capone Sneaks Back In,” Arlington Daily Herald, June 9, 2000, ProQuest.

111 Bennett, Third City, 98; Sharon Zukin, “Whose Culture? Whose City?,” in Urban Culture: Critical Concepts in Literary and Cultural Studies, Volume 3, ed. Chris Jenks (New York, NY: Routledge, 2004), 94.

112 Greenberg, Branding New York, 30. 69

imagination not just by Chicago’s newspapers, but by an increasingly globalized stream

of images on television and the internet. Even if Daley had other ideas about how to best

promote Chicago, representations of the Bulls played a central role in transforming the

identity of the city from a broken metropolis to a playground for leisure-seekers and

businessmen.

Whose Image?: The Bulls and the Politics of Division in Post-Industrial Chicago

Richard M. Daley’s preferred growth model restored the old division between

downtown and the neighborhoods fostered by his father rather than continuing the efforts of Washington to ensure that struggling neighborhoods had more equitable access to city resources. As a result, economic development in Chicago during the 1990s reinforced structural inequality along lines of race and class. While the younger Daley broke with

his father by embracing a certain degree of multiculturalism, his tenure as mayor was

characterized by the continued deterioration of social and economic security for many

Chicagoans outside of the Loop and moneyed North Side.

This presented a problem in terms of urban rebranding, since Chicago’s reputation had been dogged not only by the association with the gangsterism brought to mind by

Capone, but also by its protracted and ongoing history of racial violence. The Chicago bureau chief for NBC News summed up the issue a few years before Richard M. Daley’s election, noting that “the racism in this city is almost contrary to the image I think

Chicago wants for itself. It’s a real dark spot on the city’s character.”113 By pursuing an

economic policy focused on cultivating a new civic identity through a revitalized

downtown (at the expense of poor minority neighborhoods), Daley ran the risk of

113 Quoted in Magda Krance, “Assignment Chicago,” Chicago Tribune, March 3, 1985, ProQuest.

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exacerbating a problem that had long fed into anxieties about whether or not Chicago

could provide a safe and profitable environment for tourists and businessmen.

With this as the political backdrop, the local papers jumped at the chance to point out how professional basketball had brought together a fragmented city when the Bulls netted their first title in 1991. In many cases, the narrative revolved around how the Bulls

created what David Rowe and Pauline McGuirk refer to as “spatially constructed unity”

by transcending Chicago’s segregated geography.114 For example, a piece from the Sun-

Times catalogued the diverse array of neighborhoods where fans spilled into the streets to

celebrate, ranging from the plush North Side communities off Rush Street to the

notoriously destitute Henry Horner Homes housing project on the West Side. “North

Side, South Side, West Side: People shot off firecrackers and took to the streets. They

high-fived and hugged and cheered,” the paper read. Sam Smith, the Bulls beat writer for

the Tribune, described the Bulls as “Chicago’s team, winning with a bit of Gold Coast

glamour and a lot of stockyards effort.” Another Tribune article joined the themes of

cross-class and cross-neighborhood solidarity. “Young and old, hardhats and suits,

Chicagoans and suburbanites were talking to each other,” the piece noted, “the Bulls’

World Championship…for this week at least, united a diverse metropolitan area.”115

Even though many of these articles failed to mention explicitly the issue of race,

by pointing out that the North, South, and West sides celebrated simultaneously, they implied to anyone familiar with of Chicago’s geography that one of the exceptional aspects of the festivities was their seeming transcendence of racial boundaries. In 1990,

114 Rowe and McGuirk, “Drunk for Three Weeks,” 126.

115 Alf Siewers, “Bulls Win It! Whoop It Up For New NBA Champs!,” Chicago Sun-Times, June 13, 1991, NewsBank; Sam Smith, “High Five! Bulls Are Champs!,” Chicago Tribune, June 13, 1991, ProQuest; “What a Week,” Chicago Tribune, June 16, 1991, ProQuest. 71

black-white segregation in Chicago remained entrenched. According to that year’s census, blacks comprised at least 90% of the total population in 297 of the city’s 829 census tracts (see Map 1.1), almost all of which were clustered on the South and West

Sides. According to a more sophisticated analysis by John Logan and Brian Stults, 84.6% of blacks living in the metro area at that time would have had to relocate to a different census tract in order to achieve perfect black-white integration, and the average black

Chicagoan lived in a neighborhood in which blacks made up 78.3% of the total population. Only Detroit ranked as more segregated by both of these measures.116 As

Map 1.2 shows, elevated poverty rates often coincided with disproportionately black neighborhoods. Data from the 1990 census indicates that of the 140 tracts in Chicago with concentrated poverty (i.e. 40% of the population living below the official poverty line), 102 had black populations comprising over 90% of the total number of persons, and only 28 had black populations comprising less than half the total.117

116 John Logan and Brian Stults, The Persistence of Segregation in the Metropolis: New Findings from the 2010 Census, Project US2010 (March 24, 2011), http://www.s4.brown.edu/us2010/Data/Report/report2.pdf, 6, 8. The situation was equally—if not more— dire within Chicago Public Schools (CPS). According to data compiled and analyzed by Logan, in 1990 84.2% of black students in CPS would have had to transfer to different schools in order to achieve an equal racial distribution across the city. In the same year, the average black CPS student attended a school that was 88.2% black. See “City of Chicago School Dist 299, Illinois,” School Segregation Reports, consulted September 3, 2013, http://www.s4.brown.edu/schoolsegregation/reports.htm. According to an analysis of 2000 Census data by Salvatore Saporito and Deenesh Sohoni, this racial segregation coincided with striking economic segregation. They found that while the typical poor student in Chicago attended a school with a 70% student poverty rate, they lived in an attendance boundary with a 48.7% student poverty rate (i.e. because of some parents’ choice of private schooling, public schools were more economically segregated then their surrounding attendance catchment areas). Salvatore Saporito and Deenesh Sohoni, “Mapping Educational Inequality: Concentrations of Poverty Among Poor and Minority Students in Public Schools,” Social Forces 85, no. 3 (2007): 1227-1253. Today, Chicago schools remain extremely segregated. According to data compiled by UCLA’s Civil Rights Project, of the twenty-five largest metropolitan areas (by school enrollment), the Chicago metro area has the highest percentage (48.5) of blacks attending schools where minorities constitute 99-100% of the population. Moreover, the typical black student attends a school where over 68% of the student body is poor (the third highest rate in the county). Gary Orfield, John Kucsera, and Genevieve Siegel-Hawley, E Pluribus…Separation (Los Angeles, CA: UCLA Civil Rights Project, September 2012), consulted September 3, 2012, http://civilrightsproject.ucla.edu/research.

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Map 1.1. Blacks as Percentage of Total Population by Census Tract, Chicago, 1990 (297 of 869 tracts ≥ 90% black). Sources: Shapefiles and full count census data obtained from Minnesota Population Center (2011).

117 U.S. Census Bureau, Census of Population and Housing (Washington, DC: Government Printing Office, 1992), Summary Tape File 3, tables NP4, NP123, NP1, NP6, NP7. While Less pronounced, segregation also affected Chicago’s Latino communities, the growth of which has been concentrated on the northwest and southwest sides of the city. Logan and Stults, The Persistence of Segregation, 12. 73

Map 1.2. Family Poverty Rate by Census Tract, Chicago, 1990 (140 of 869 tracts with families below the poverty line). Sources: Shapefiles and census sample data obtained from Minnesota Population Center (2011).

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Sometimes, the press more explicitly asserted the team’s ability to dissolve racial

and ethnic distinctions. After the Bulls’ fourth championship in 1996, the Tribune suggested that the Bulls functioned as a “local anesthetic,” temporarily allowing

Chicagoans to “forget about pain” caused by having to confront the reality of a city where blacks and whites still felt at odds. “People who may believe they have nothing in common with other people of different ethnic, racial, geographic, or age-defined groups

find community via the Bulls,” the article continued. And readers didn’t necessarily have

to take the papers’ word for it. When the Sun-Times interviewed black West Side resident

Rodney Tolbert on the night the Bulls put away the Los Angeles Lakers in the final game

of the 1991 finals, he told the paper, “we need this…Especially for the young people. It’s

bringing everybody together—black, white, Hispanic—they’re all celebrating together.”

“It was like everything that was bothering you wasn’t bothering you anymore,” South

Sider Elana Haskins-Flower told the paper a few days later. Echoing Greene and

Haskins-Fowler in a 1999 retrospective piece on the Bulls following Jordan’s second

retirement, Rick Morrissey wrote in the Tribune, “Chicago might be one of the most

segmented cities in the country, but Jordan was a rainbow coalition of one. He made

everyone feel good—blacks and whites, Democrats and Republicans.”118

But not everyone agreed with this evaluation. A handful of dissenters questioned

the degree to which professional sport could function as a collective good, temporary or

otherwise. When interviewed in the wake of the Bulls 1993 championship, Chicagoan

Paul Hajek sniped to a reporter, “basketball doesn’t change anything. If everyone got the

day off when they won, then maybe it would be something.” Around the same time,

118 Bob Greene, “A Coach, A Team, A Local Anesthetic,” Chicago Tribune. Jun 23, 1996, ProQuest; Siewers, “Bulls Win It!”; Don Hayner, “Fans at Rally Show Bulls Their Love Knows No Limit,” Chicago Sun-Times, June 16, 1991, NewsBank; Morrissey, “Jordan Had Rare Air.” 75

Tribune columnist Mary Schmich offered one of the only—perhaps the only—critique of

the Bulls’ alleged community-building effect by a local mainstream journalist. Schmich

agreed with a personal friend who had told her that “the Bulls’ win has very little to do

with Chicago and everything to do with the band of high-priced nomads hired to sink a

ball in a basket…All these guys we know by first names could all be somewhere else—

and they will be before you know it.”119 For skeptics like Hajek and Schmich, this all

seemed like a distraction from bigger issues.

They raised good points. Despite promoting several blacks and Latinos to powerful positions in City Hall and an abundance of lip service to the importance of diversity and economic development in underprivileged communities—a nicety his father rarely if ever indulged in—Richard M. Daley got behind several initiatives bound to exacerbate inequality within the city during the Bulls’ dynastic run.120 For example, a

study by the Boston Consulting Group found that, between 1996 and 2000, the

distribution of economic development money within the city was heavily weighted

towards wealthy neighborhoods. According to Paul Street’s summary of the data, “the

city’s disproportionately white top two quartiles of community areas (as ranked by

‘economic vitality’) received a total of $6.5 billion in economic development funding

from 1996 to 2000,” while the “disproportionately black and Hispanic bottom two

quartiles received only $3.9 billion, 40 percent less than their whiter and more affluent

counterpart communities.”121 Bennett notes that much of the money flowing into the top

119 Bob Secter and James Hill, “1 Down and 2 to Go for the Bulls,” Chicago Tribune, June 21, 1996, ProQuest; Mary Schmich, “Community Bond is a Bunch of Bulls,” Chicago Tribune, June 23, 1993, ProQuest.

120 On the superficial multiculturalism of Richard M. Daley, see Bennett, Third City.

76

two quartiles went towards “lubricating private investment” in the Loop and North Side

in the form of infrastructural development and beautification, and in many cases funded

direct subsidies for projects yielding millions in profits for private real estate developers.

Street asserts that, during the 1990s, the Daley administration “divert[ed] millions of tax

dollars from the potential meeting of black community needs to major downtown projects

like the development of Millennium Park and the construction of Hyatt Regency

McCormick Place Hotel.”122

Partisans of this Loop-centered economic development strategy could point with

satisfaction to nominal decreases in the citywide poverty rate and a slight easing of

segregation between 1990 and 2000 in order to make the argument that the alleged

cohesion fostered by the Bulls coincided with real progress. These statistics, however,

masked a more complex reality.123 Street reports that Chicago communities where the

proportion of African-American residents rose during the 1990s “tended to lose jobs…the

city’s nineteen disproportionately black zip codes lost 18,080 jobs between 1991 and

2000,” while “the fifteen Chicago zip codes that were 75 percent or more white in 1990s

collectively gained 19,215 jobs during the same period.” He also notes that forty-four of

Chicago’s seventy-seven community areas experienced an increase in poverty levels during the nineties, and that the majority of these were disproportionately black and/or

121 Paul Street, Still Separate, Unequal: Race, Place, Policy, and the State of Black Chicago (Chicago, IL: Urban League, 2005), 146.

122 Bennett, Third City, 98; Street, Racial Oppression in the Global Metropolis, 254, 258.

123 According to census figures, the poverty rate fell from 21.6 to 19.6. Author’s calculations from John Logan, Zengwang Xu, and Brian Stults, Longitudinal Tract Database, US 2010 Project, http://www.s4.brown.edu/us2010/Researcher/Bridging.htm. Logan and Stults also note nominal decreases in spatial measures of segregation during this period. See Logan and Stults, The Persistence of Segregation. 77

Latino.124 Moreover, unemployment levels for black Chicagoans remained more than double that of white residents, even amidst the economic expansion of the 1990s (see

Table 1.8). Clearly, the turnaround overseen by Daley and supported by the most robust national growth since the 1970s proved far from evenly distributed.

Table 1.8. Annual Average Unemployment Estimates by Race, Chicago City, 1997-2000.a Citywide White Hispanic Black 1997 8.3 (± 0.8) 5.4 (± 0.8) 8.5 (± 1.8) 13.8 (± 1.7) 1998 7.2 (± 0.8) 5.2 (± 0.8) 8.3 (± 1.7) 10.7 (± 1.5) 1999 7.7 (± 0.8) 5.0 (± 0.8) 5.9 (± 1.4) 13.4 (± 1.6) 2000 7.4 (± 0.8) 4.0 (± 0.7) 4.4 (± 1.2) 13.9 (± 1.6) Source: Adapted from Bureau of Labor Statistics, Geographic Profile of Employment and Unemployment (1999-2002), Table 23 (1999 and 2000 editions) and Table 24 (2001 and 2002 editions). Figures are annual averages based on monthly estimates from Current Population Survey. a Margin of error due to sampling error listed in parentheses. All margins correspond to a 90% level of confidence (calculated by BLS).

The “unity” generated by the Bulls’ success also existed alongside increasing

racial disparities in the context of local criminal justice. Mirroring national trends set in

motion by the escalation of the “War on Drugs,” Illinois’ prison population, 60-70% of

which typically comes from the Chicago metropolitan region, not only skyrocketed

during the last two decades of the twentieth century, but also became even more

disproportionately black.125 Between 1990 and 1998 alone, the population of males in a

state or federal correctional institution in Illinois shot up from 27,516 to 43,051. Of the

new prisoners, blacks made up 73%, raising the overall proportion of black inmates from

62% to 66% (see Figure 1.4). The targeting of young men of color for drug-related arrests

124 Street, Racial Oppression in the Global Metropolis 200, 257.

125 Street, Racial Oppression, 240. For additional data, see Chicago Metropolis 2020, 2006 Crime and Justice Index (Chicago, IL, October 2006), http://www.metropolisstrategies.org/documents/2006CrimeandJusticeIndex.pdf. 78

fueled this trend. As Human Rights Watch reported in 1996, in Illinois blacks represented

9 out of every 10 inmates imprisoned for drugs.126

White Other Black

50,000

45,000

40,000

35,000

30,000

25,000

20,000

Number of of Number Prisoners 15,000

10,000

5,000

0 1990 1991 1992 1993 1994 1995 1996 1997 1998 Year

Figure 1.4. Number of Prisoners in State/Federal Prison by Race, Illinois, 1990-1998.a Source: Bureau of Justice Statistics (1990-1998), Table 5.6. a Racial figures are estimates. “Some or all Hispanics” contained in “other” category.

Admittedly, the Chicago press rarely if ever went so far as to argue that the Bulls’ success actually solved persistent racial disparities in incarceration, employment, and access to public resources. And while the very act of situating the team as a sort of cultural ointment for the city acknowledged the persistence of profound social divisions, the implicit recognition of these divisions did not coincide with a broader effort of the

Chicago media to raise public consciousness about or more seriously address the issue of structural inequality along racial and class lines. Anselm Strauss noted over half a century

126 Street, Racial Oppression, 241. 79

ago that celebrated urban symbols tend to “blot out what lies behind, or invite the viewer

to disregard it, in favor of the interpretation presented by the façade itself,” and the Bulls

as covered by the local media blotted out Chicago’s harsher realities in two ways.127 The

first had to do with the sheer volume of coverage received by the team, which often

spilled from the sports pages into other sections, and no doubt ate into the amount of

space devoted to topics that might lead to a less sanguine portrayal of the city. The

second had to do with the actual content of the coverage. By insisting that hosting an

NBA champion provided Chicagoans from all neighborhoods with a reprieve from the

pressures of their daily lives, the press actively encouraged readers to look away from

ongoing inequities over which a basketball team had no enduring influence.128

That a successful sports team seems to have overshadowed dialogue about the

urban crisis in 1990s Chicago makes sense both in the broader context of the American

media at the end of the twentieth century, as well as in terms of the singular focus on

growth among local political and business leadership. Social critic Henry Giroux argues

that “since the 1990s there has been a drying up of images that make the violence of war,

poverty, and racism visible in the in the United States,” not because these problems

disappeared, but rather as a result of an increasing tendency within the media to “render

invisible” the millions of Americans damaged by regressive social and economic

policy.129 The discourse around the Bulls constituted just one case of a much larger move

away from public dialogue about inequality and oppression. In Chicago, this no doubt

127 Strauss, Images of the American City, 11.

128 On the long history of sports coverage as a distraction from larger issues, see Robert McChesney, “Media Made Sport: A History of Sports Coverage in the United States,” in The Political Economy of Media: Enduring Issues, Emerging Dilemmas, 213-232, (New York, NY: Monthly Review Press, 2008).

129 Henry Giroux, Stormy Weather: Katrina and the Politics of Disposability (Boulder, CO: Paradigm, 2006), 3, 23. 80

worked in support of elites’ desire to dispel images of poverty and uneven development

that might rub tourists and investors the wrong way. In the case of the Bulls, this was not

simply a matter of conveying a winning image, but also of trying to use the team’s

popularity as a way of sidestepping the thorny issue of exclusion from the post-industrial

model of economic development.

Despite the media’s best efforts, the Bulls’ success occasionally manifested itself

in the sort of events and images that the local political establishment wanted to wipe

away from popular representations of Chicago. In particular, each of the six NBA titles

set off spontaneous celebrations throughout the city that, in many cases, morphed into

looting, property damage, and confrontations between police and local residents. While

disturbances broke out immediately after every championship, data collected on arrests

and property damage by sociologist Michael Rosenfeld shows that the most extensive riot

activity took place in 1992 and 1993, and subsided considerably in subsequent years

(activity in 1991 was either more scattered or significantly underreported). He argues

that, while the local press did its best to ignore or provide a “mostly misleading picture”

of the riots as a result of drunken celebration or interethnic conflict, the riots actually

embodied accumulated political grievances by poor black communities. In the context of

ongoing tolerance by municipal officials of police brutality as dramatized from afar by

the Rodney King trial, as well as the draconian cuts to public welfare made by the state of

Illinois in the early 1990s, the post-championship riots were not simply celebrations gone

awry, but also a political reaction by Chicago’s urban black community in response to

ongoing marginalization.130

130 Michael Rosenfeld, “Celebration, Politics, Selective Looting and Riots: A Micro Level Study of the Bulls 1992 Riot in Chicago,” Social Problems 44, no. 4 (November 1997): 489, 483. 81

By offering empirical evidence that most of the riot activity on the South and

West Sides involved the looting of food stores (i.e. stores with essential, non-luxury

items), Rosenfeld’s analysis confirms that the growth model based on rebranding

Chicago with new icons like the Bulls failed to remedy local economic polarization.131

His work also speaks to the commitment of Chicago’s media to preserve the new urban identity it had constructed even if it meant papering over this deprivation. In line with

Giroux’s thesis about media’s growing tendency to erase dialogue about urban poverty and racism by fiat, Rosenfeld’s notes that, with the exception of 1992, the violence “went virtually unreported outside Chicago and was barely mentioned by the Chicago papers.”132 In 1992, the violence proved harder to ignore, in part because of its scale.

That year the riot resulted in 1060 arrests (378 more than the second most extensive riot

in 1993) and 347 cases of property damage (170 more than 1993).133 In addition, the

disturbances in 1992 involved not just riots on the South and West sides, but also the

antics of what the Sun-Times described later as a “yuppieish young crowd” downtown

that flipped over cars and broke the glass of several upscale Loop retailers in the hours

after the Bulls clinched the title on June 14th.134 The seeming oddity of white kids

throwing bricks at windows in the Loop no doubt caught reporters’ attention.

Rosenfeld notes correctly that media explanations of the 1992 Bulls riots varied

within Chicago, but rarely if ever considered the possibility that they were a reaction to

the ongoing economic and political marginalization of participants. Instead, the local

131 Rosenfeld, “Celebration, Politics,” 493.

132 Rosenfeld, “Celebration, Politics,” 489, 491.

133 Rosenfeld, “Celebration, Politics,” 488.

134 Raymond Coffey, “Cops’ Defense Stars After the Sun Sets,” Chicago Sun-Times, June 22, 1993, NewsBank. 82

papers usually offered one of two competing interpretations. The first, dealt with in detail in Rosenfeld’s work, posited that the unrest consisted of two phenomena: rowdy fans in the Loop who took celebrating too far and poor blacks on the South and West Sides who looted neighborhood stores in an attempt to take vengeance on Korean shopkeepers with whom they had a long history of tension. A Tribune article that appeared a couple weeks before the 1992 riot set the stage for this interpretation, asserting that the looting in black neighborhoods the previous year had hit Korean merchants the hardest, and quoting local residents who corroborated the uneasy relationship between the merchants and people who lived nearby.135

In the days following the riot, the Tribune, Sun-Times, and Defender all printed articles suggesting that the friction between blacks and Koreans fueled the looting and violence outside the Loop. The papers were right to indicate that what happened in black neighborhoods differed from the events downtown, but the argument about blacks taking revenge on Koreans does not hold up in the face of Rosenfeld’s data. Rosenfeld found that Arab-owned stores in zip codes on the South and West Sides with more than ten looting incidents proved much more likely to suffer looting and damage than Korean shops, and hypothesized that the difference might be explained by the fact that Arab merchants owned a much larger proportion of food and liquor stores containing items useful to the rioters. His regression analysis confirms that, as predicted, “the difference in the looting rate experienced by Arab, Korean, and black-owned stores is essentially determined by the kind of stores the different groups tend to own.”136 Whether or not a

135 Jennie Acker, “Koreans Testing Waters in Search of Firmer Ground with Blacks,” Chicago Tribune, May 26, 1992.

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store sold food and other consumables proved a much better predictor of its probability of

being looted than the race of the owner. In passing over the fact that “looters selectively

targeted one particular kind of store, those that sell food and liquor, without regard for the

ethnicity of the store owner,” local papers, Rosenfield concludes, avoided a conversation

about the role of entrenched poverty in the violence.137

The second explanation for the 1992 riots offered by the local media, dealt with in

less detail by Rosenfeld, was that they were simply an unfortunate outcome of

spontaneous urban hooliganism. Rosenfeld believes that this logic emerged at least in

part from the failure of reporters to thoroughly cover the geographic reach of the damage,

but I want to suggest that this line of reasoning also made a lot of political sense for local

elites.138 In fact, Mayor Daley was one of the first to offer it up, telling the press in the

days following the riots in 1992 that “you have to understand—when you’re

celebrating…in America, what you do is you break a window and grab

something...That’s a reality that’s taking place in America.”139 In other words, the poor

blacks and yuppie celebrants downtown were all part of a much larger pathology of

“celebration” disconnected from the realities of urban life.

Sports columnist Jay Mariotti echoed a similar, if more histrionic line of thinking,

noting that “the city had 3 million people, the suburbs another 5 million, yet a barbaric

136 Rosenfeld, “Celebration, Politics,” 489-491, 494. According to Rosenfeld’s results, within the sample the odds of a “food and liquor” being looted were 132% higher than for a “general merchandise and miscellaneous” store (significant at the p < 0.001 level).

137 This was true for both the absolute number and the within-group proportions. Incidentally, if anyone was guilty of racial profiling during the 1992 riots, it was the police, who, despite large numbers of whites engaging in criminal activity downtown, ended the night with a roster of felony arrests that was 98% black. Rosenfeld, “Celebration, Politics,” 493, 485.

138 Rosenfeld, “Celebration, Politics,” 489.

139 Fran Spielman, “Daley Salutes Cops’ Response,” Chicago Sun-Times, June 16, 1992, NewsBank. 84

fringe drags Chicago through national newscasts as a riot capital.” Mariotti apparently

saw no need to distinguish between looting a store to obtain groceries and tipping over a

taxi downtown before taking the El train back to the North Side. All the celebrants

deserved the “barbarian” moniker as he saw it. “It’s sad enough that the Bulls only had an

hour in the spotlight before relinquishing it to Division Street, Pulaski and Madison, the

South-Side, and the Not-So-Magnificent-Mile,” he continued. By lumping together those

involved in the disturbances downtown with those from the rioting on the West and South

Sides, Mariotti pre-empted a discussion about why conditions in certain parts of the city

might have made the unrest seem utterly rational. This sort of open-and-shut thinking

continued in the sparse coverage of subsequent riots. After the violence in 1993, Sun-

Times columnist Richard Roeper wrote, “the most accurate assessment of the arrest,

vandalism and incidents of violence in Chicago came from police spokesman Bull Davis:

‘There is an element of knuckleheads and hooligans, and nothing you can do will stop

them.’ ”140 For commentators like Davis, Roeper, Mariotti, and Mayor Daley, arguing

that the riots stemmed from the intrinsic criminality of a lunatic fringe took the city’s political and cultural leadership off the hook for asking difficult questions about the root causes of the violence.

Tellingly, the only reporting that offered a more historically informed interpretation came from outside of Chicago. Rosenfeld notes that the New York Times’ headline, “Victory Seen as Chance to Vent Pent-up Anger” was “much closer to [the] view that the Bulls rioters were responding, in part, to a reservoir of political, economic,

140 Jay Mariotti, “Give the Arrests a Rest and Just Cheer the Bulls,” Chicago Sun-Times, June 16, 1992, NewsBank; Roper, “A Few Final Thoughts.” 85

and racial grievances.”141 Unlike their colleagues at the Tribune and Sun-Times, reporters

for the Washington Post also offered up the possibility that there was more to the rioting

in 1992 than tension between Koreans and blacks. “Although a number of the

establishments torched Sunday night were owned by Korean Americans, anti-Korean sentiment appeared to be only one ingredient in the violence,” an article in the Post

explained. Anticipating the conclusions of Rosenfeld’s research, the article revealed that

“Korean businessmen interviewed said they did not appear to be a major target of the

looters.”142 The coverage of the riots from newspapers in other major U.S. cities gives the distinct impression that the Chicago media’s unconvincing interpretation of the events

resulted not from a lack of information, but rather from the pressures to make sense of the

riots in a way that did minimal damage to the reputation of local elites and the city as a

whole.

***

When Jordan left the Bulls for good after the team’s sixth NBA championship in

1998, the team quickly nosedived, finishing with the worst record in the Eastern

Conference. With little to celebrate, some local journalists took time out to reflect on the team’s remarkable run over the last decade. In 1999, the ever-histrionic Jay Mariotti measured the impact of Jordan and his teammates by their ability to project a winning image to far-away places not typically regarded as basketball meccas. “I’ve walked into a store in basketball-dead Norway, not terribly far from the Arctic Circle, and seen a

Michael Jordan poster,” he remembered, adding, “I’ve had a translator in an obscure part

141 Rosenfeld, “Celebration, Politics,” 489.

142 Michael Abramowitz, “Bulls NBA Victory Sparks Chicago Riot,” Washington Post, June 16, 1992, ProQuest. 86

of Japan grin when I mentioned Michael Jordan.” Less than a year after Jordan’s

departure, Mariotti couldn’t help but wonder, “what will the town do without [him]?” By

that time, that national press had picked up on what the New York Times termed the

“Capone-Jordan transformation,” noting that Jordan and the Bulls had “salved

[Chicago’s] Second City complex, put substance behind its bravado, and even, some

people say, allowed Chicago to slip free of the dusty harness of history and create a new

sense of itself.” And in case any of the national audience scoffed at such a suggestion, the

Times printed an affirming quotation from Studs Terkel, “the author and voice of

Chicago’s working class.” According to Terkel, “it’s a city that has lost so often…Jordan

represents a big moment in a city of losers.”143

For some locals, pride in Jordan’s redefinition of Chicago quickly gave way to paranoia about who or what would prevent Capone’s legacy from creeping back into the conversation. In 2000, an editorial in the Arlington Daily Herald, a suburban Chicago paper, fretted over the fact that a recent 20/20 special on political corruption in Chicago had featured images of Capone for historical context, and carried the headline: “With

Michael Gone, Capone Sneaks Back In.” “There was no footage of Michael Jordan circa

1993 superimposed over the glistening city skyline,” the editorial noted disappointedly,

“it was just Capone.”144 Apparently, some worried that postcards with panoramic shots of

Navy Pier would fail to keep the ghost of Capone at bay in Jordan’s absence. Perhaps

they felt justified in their concern by the fact that, in the decade following MJ’s

departure, Chicago struggled to maintain the image of a city-on-the-remake. As in other

143 Jay Mariotti, “It’s All Over Now”; Pam Belluck, “The Bitter Chill in Chicago,” New York Times, January 13, 1999, ProQuest.

144 Goudie, “With Michael Gone, Capone Sneaks Back In.” 87

major metropolitan areas, Chicago suffered through a collapse in the local housing

market, and more than a decade into the new century the city is plagued by incessant

reports of underfunded and increasingly segregated schools, a Tax Increment Financing

(TIF) program that has become a slush fund for rich developers, and rampant corruption

in the new mayor’s office. Of course, urban decay is old news, but it may be that it is

harder to sweep under the rug in post-Jordan Chicago.

Trying to understand the symbolic value of Jordan and the Bulls in post-industrial

Chicago is a frustrating enterprise since we have no way of pinpointing how different the city’s political and economic history would have been in the absence of six NBA titles.

What we do know, however, is that by the last decade of the twentieth century, the

politicians, businessmen, and media outlets that made up Chicago’s pro-growth coalition

desperately needed to provide a new image for their city if they were to cement its status

as a hub of profitable post-industrial enterprise. The history of the local media’s

promotion Jordan and the Bulls as the city’s icon demonstrates not only that local growth

coalitions considered sport an important strategic asset in the interurban competition for

investment and consumer spending at the end of the twentieth century, but also that its

value depended on much more than the development of glittering luxury arenas. It also

depended on opportunistically transforming a local team’s unprecedented success into

evidence of and an allegory for Chicago’s purported civic rehabilitation.

That basketball provided many non-Chicagoans with the impetus to visit the city

proves that this strategy had its merits from the perspective of pro-growth interests. That

said, the social history of 1990s Chicago reminds us that the larger process of urban

economic transformation to which the Bulls’ contributed offered little in the way of

88

solutions to the persistent inequality and exclusion plaguing many of the city’s

neighborhoods. Even if the team’s success provided some much-needed joy to the people who lived in those neighborhoods, it didn’t make their sidewalks safer or put more food on their table.

As the next chapter documents, that Chicagoans from across the city shared a love for the Bulls did not mean that they all enjoyed the team on the same terms. In fact, the

Bulls of the late eighties and nineties sat at the heart of larger transformations in the relationship between pro sports franchises and their hometowns which ensured that

“fandom” meant very different things depending on where one lived and how much money one had to spend.

89

Chapter Two

“Normally, Heroes Cost You Money”: Consumption, Class, and the Bulls

Sometime around midnight on June 13th, 1991, Ed Mueller of suburban Des

Plaines, IL, snuck out of the house as his wife and kids slept, and made his way to Grant

Park in downtown Chicago. No, it wasn’t for a late night tryst in the city; Mueller simply

wanted to make sure that he nabbed a good viewing spot for the rally where the Bulls and

their fans would celebrate the teams’ first ever NBA championship. Mueller was one of

many who went to seemingly absurd lengths to participate in what Mayor Daley had

designated as “Bulls NBA Championship Day.” Some even threatened to quit their jobs if

their bosses denied permission to attend.1

In the wake of the celebration, which drew hundreds of thousands from the city and surrounding suburbs, the local press made sure to point out the varied origins of those in attendance. A typical account of the rally recalled a hand-written sign saying “Park

Forest loves the Bulls,” and added, “so [does] Palatine and Evanston and Wheaton and

Englewood and Hyde Park.”2 This diverse list of neighborhoods and suburbs suggested

that pro basketball really could bring disparate parts of the metropolis together. Indeed,

even if the rhetoric of community cohesion around the Bulls clashed with the political

and economic realities of Chicago, there was more to it than shameless boosterism.

Words like “community” and “cohesion” no doubt overstated the stakes when the

celebration consisted of disparate parts of Chicago rejoicing simultaneously in their

1 Melissa Isaacson, “ ‘Celebration’ Fun for Almost All,” Chicago Tribune, June 15, 1991, ProQuest; “Rally Set for Noon on Friday,” Chicago Tribune, June 13, 1991, ProQuest.

2 Papajohn and Wilgoren, “Hundreds of Thousands Reach Out, Touch Bulls,” Chicago Tribune, June 15, 1991, ProQuest. 90

respective neighborhoods—that is, celebrating “together” only insofar as they rooted for the same team, but without actually crossing spatial boundaries. Sometimes, however, the collective aspect of the festivities proved less virtual and more concrete, giving fans from different walks of life the opportunity to rub elbows with one another. Nothing exemplified this more than the six official post-championship rallies organized by the city and held in Grant Park, where for a few hours the abstract “community” of Bulls fans drummed up by the media became much more tangible. They demonstrated not only that the team provided a much needed distraction, but also that it could promote, even if only for a brief moment, the integration of urban space in Chicago. In this context, Jordan and the Bulls became an urban “asset” not just in terms of their utility in promoting local exchange values, but also in terms of temporarily transforming a small swath of downtown into a place where Chicagoans could bask collectively in the euphoria of victory.

But even if the Bulls succeeded in bringing together a mix of Chicagoans in Grant

Park, the media coverage of the rallies betrayed the fact that not all fans could celebrate the Bulls on the same terms. For many, the gatherings in Grant Park were their only real chance to see the NBA champions in person, as the steep ascent of ticket prices that began in the second half of the eighties made attending a live game at Chicago Stadium increasingly unrealistic for most fans. These growing cost barriers resulted in large part from the team’s adoption of a growth model that depended explicitly on catering to an expanding base of wealthy fans, and nothing signaled this trend more than the construction of the United Center in the early 1990s as a replacement for Chicago

Stadium. Design of the United Center focused on maximizing premium seating like

91

luxury boxes and club seats, which quickly emerged as the city’s premier leisure spaces for local elites. Even though more traditional seats remained, the incredibly high demand for tickets to see Jordan and the Bulls drove prices to the point where even middle-class

suburbanites who showed up to the aforementioned rallies complained about the

inaccessibility of live games.

While team officials and the media acknowledged the growing exclusivity of the

United Center, they argued that it was the unfortunate outcome of the Bulls’ obligation to

keep up with rising player salaries. However, as sports economists have argued, this

explanation confused cause with effect. In fact, high ticket prices were first and foremost

a function of the demand for seats among Chicagoans, and high player salaries

represented the outcome of increased revenues from costlier tickets, skybox leases, and

the soaring value of television rights contracts.

Broadly speaking, the shifting demographics of fans inside the United Center that

coincided with this spike in demand derived from important macroeconomic

developments at the end of the twentieth century. In particular, the stagnation of wages

for many Americans and the upward redistribution of income and wealth meant that the

growth of revenues and profits for the owners of leisure spaces like the United Center

depended increasingly on targeting an elite clientele. Indeed, the Bulls’ front office

expended a considerable amount of time and effort transforming basketball into a luxury

viewing experience. For all the rhetoric of “togetherness” unleashed by the Bulls’

success, during the eighties and nineties consuming pro basketball in Chicago became an

experience shaped more and more by fans’ class position.

92

Rallying Around the Bulls: Celebration, Race and Class in Chicago’s Grant Park

In its current incarnation, Grant Park stretches for over a mile and a half along the

lakefront of Chicago’s central business district (see Map 2.1). Originally designated a

public park in the mid-nineteenth century, by 1930 the site had become home to many of

Chicago’s most venerated cultural institutions, including the Art Institute, Adler

Planetarium, and the Shedd Aquarium. Decades later, the park became the setting of one

of the most infamous chapters in the city’s history when police attacked anti-war

demonstrators who had gathered there to protest the 1968 Democratic National

Convention.3

In much the same way that it situated Jordan and the Bulls as a “cure” for the

legacy of Al Capone, the local media occasionally suggested that the team’s success

helped refocus attention away from the enduring memory of the clash between cops and

protestors in 1968. Looking back at the Bulls several years after their last title, one

Tribune columnist wrote, “until the sublime play of Michael Jordan, the contributions of

Scottie Pippen and the Zen leadership of Phil Jackson, Chicago was known as a center of

gang violence, the 1968 Democratic National Convention, a less than sterling political

tradition and underachieving sports teams.”4 When the city announced the day after the

Bulls won their first title in 1991 that Grant Park would be the location of an official

“victory celebration,” the stage was set for a gathering that would not only bring together

3 On the history of Grant Park , see Timothy Gilfoyle, Millennium Park: Creating a Chicago Landmark (Chicago, IL: University of Chicago Press, 2006).

4 Richard Rothschild, “They’re Gone, But Can’t Be Forgotten,” Chicago Tribune, April 23, 2006, ProQuest.

93

the larger “community” of Bulls fans, but that might also help rehabilitate a downtown

landmark with a checkered past.5

Map 2.1. Geography of Celebration for Chicago Bulls Fans. Sources: Chicago Metropolitan Agency for Planning (1990, 2001); City of Chicago, Chicago Data Portal.

According to the press, the event succeeded on both counts. An estimated

500,000 Bulls faithful from the city and suburbs turned out to cheer as the Luv-a-Bulls cheerleaders and mascot Benny the Bull warmed up the crowd. Finally the players and coaches appeared brandishing their championship trophy.6 Police reported relative calm,

save some pushing and shoving as fans jockeyed for position closer to the action. One

reporter gestured to the stark contrast between the gathering in honor of the Bulls and the

5 “Bulls Bash to Start at 11 Tomorrow at Grant Park,” Chicago Sun-Times, June 13, 1991, NewsBank.

6 Estimates of rally attendance taken from Michael Rosenfeld, “Celebration, Politics, Selective Looting and Riots: A Micro Level Study of the Bulls Riot of 1992 in Chicago,” Social Problems 44, no. 4 (November 1997): 488. 94

tumultuous scene that transpired there in 1968. “There was something missing from the

typical mass gathering in Grant Park,” he wrote. “Most of the pushing was polite

pushing.”7 Another reporter agreed, noting that “people were too busy dancing, singing

and listening to get into much trouble.”8 Yet another likened it to the crowd that turned out to see the Pope when he appeared in Grant Park in 1979.9 City Hall surely looked on with satisfaction as the crowd exorcised some of the park’s historical demons.

The media also paid close attention to the diversity of the attendees, citing it as proof of the capacity for sports to break down the city’s socioeconomic and political divisions. Reporters who roamed the crowd made sure to catalogue the long list of places from which celebrants hailed: Sally Wyatt of suburban Aurora…Randall Woodward from the South Side…Tom Bare of suburban Des Plaines…students from Brown Elementary

School on the West Side on a once-in-a-lifetime fieldtrip. According to the Tribune,

“fans were inspired by the No. 1 team, uniting for an hour at least and forgetting the divisions that mark daily life…North Side and South Side and West Side, city dweller and suburbanite, African-American and German-American and Italian-American.”10

Another wrote, “on a day when jobs and responsibilities were still calling and financial

problems of the Chicago schools and Illinois state government were still dividing groups

along political and economic lines…strangers weren’t strange but fellow fans.”11

7 Rob Karwath, “Bulls Bring Out the Champion in Everyone,” Chicago Tribune, June 16, 1991, ProQuest.

8 Monica Copeland, “Blues Festival or Bulls Rally?,” Chicago Tribune, June 16 1991, ProQuest.

9 George Papajohn and Jodi Wilgoren, “Hundreds of Thousands Reach Out, Touch Bulls,” Chicago Tribune, June 15, 1991, ProQuest.

10 Don Hayner and Tom McNamee, “A Bulls Bash,” Chicago Sun-Times, June 14, 1991, NewsBank; Isaacson, “ ‘Celebration’ Fun for All”; Papajohn and Wilgoren, “Hundreds of Thousands Reach Out.”

11 Karwath, “Bulls Bring Out the Champion.” 95

The picture painted by these accounts wasn’t far off the mark. The post-

championship celebration held in Grant Park in 1991 was an astonishing display of

diversity—the visual record of the celebration leaves little room for debate in this regard.

Close-up pictures of the crowd at the rally show Blacks, Asians, Latinos, and whites crammed together like sardines behind police barricades, raising fists, pennants, banners, and pom-poms.12 Moreover, some of the photos reveal that, more than just happening to

stand next to one another at the rally, people from different ethnic and racial backgrounds

interacted joyously. In an iconic image from the 1991 celebration, two young men, one

black and one white, exchange an enthusiastic high five as other celebrants look on

(Figure 2.1). One would be hard pressed to find better confirmation of the argument of

sociologists David Karp and William Yoels that “on its most obvious level, sport

provides a universal language for people and thereby lubricates the gears of social

interaction.”13

12 For an example of these photos, see Roland Lazenby, And Now, Your Chicago Bulls!: A Thirty-Year Celebration! (Dallas, TX: Taylor Publishing Company, 1995), 210.

13 David Karp and William Yoels, “Sport and Urban Life,” Journal of Sport and Social Issues 14, no. 2 (September 1990), 97. 96

Figure 2.1. Two Chicagoans High-Five as Bulls Fans Congregate in Grant Park to Celebrate the Teams’ First NBA Championship in 1991. Source: Osgood (1991).

As the Bulls’ championship ways continued, so did the rallies in Grant Park. The

1992 celebration drew considerably fewer fans—a mere 40,000 according to the most conservative estimates—perhaps because the city had scheduled the previous year’s festivities on the inaugural day of the local Blues Festival in Grant Park, which meant that many Chicagoans had already planned to be there. Die-hard fans still went to great lengths to make it out, as did Tony Barton, a local carpenter who, when given the choice between his job and attending the rally, opted for the latter. “I live with my parents,”

Barton told a reporter, “so now I’ve got to go home and tell them I’ve quit my job.” But the meager turnout in 1992 ultimately proved an aberration. After the Bulls 1993 title run, an estimated 150,000 fans “rang[ing] in age from just out of the cradle to pretty close to the grave” made the post-title pilgrimage to Grant Park. Apparently, the two-year drought after the third championship had made fans restless, as somewhere between

175,000 and 250,000 people braved the rain and mud to take a “collective ‘sick day’ from work, school and other official duties to party” at the fourth installment of

97

“Bullapalooza” in 1996. Despite inclement weather the following year, estimates from the Mayor’s Office pegged the crowd at approximately 225,000 fans. In 1998, sensing that the dynasty’s days were numbered as rumors circulated that Michael Jordan would soon retire for a second time, the size of the crowd allegedly swelled to between 300,000 and 500,000 fans.14

The press coverage of the rallies thinned out after 1991, but the themes of diversity and social cohesion via sport still surfaced in the reports that did appear. It even seemed that, by the late 1990s, the rallies had become a new benchmark for showcasing

Chicago’s diversity. Reporting on a conference of local clergy at the University of

Illinois at Chicago in the fall of 1997, the Tribune noted that, “except for the Bulls championship celebrations in Grant Park, [the conference] may have been the most diverse mass gathering of Chicago-area residents ever. Catholic, Protestant, Jewish and

Islamic clergy embraced on stage before a sea of black, brown, and white faces from virtually every section of the city and suburbs.”15 The gatherings for the Bulls at Grant

Park had apparently become a template for an integrated community that, if elusive on a day-to-day basis, could be realized under the right circumstances.16

14 Rosenfeld, “Celebration, Politics,” 488. Flynn McRoberts and Elizabeth Chur, “40,000 Bulls Fans Rally in Grant Park to Say: ‘We Like Mike and His Friends’, ” Chicago Tribune, June 17, 1992, ProQuest; Bill Jauss, “Young, Old Alike Turn Out to Hail Champions,” Chicago Tribune, June 23, 1993, ProQuest; Yochi Dreazen, “More! More! More!,” Chicago Sun-Times, June 16, 1997, NewsBank; Richard Roeper, “Grant Park Sideshow Zero-Star Production,” Chicago Sun-Times, June 19, 1996, NewsBank; Sabrina Miller, “Thanks 4 the Memories,” Chicago Tribune, June 18, 1996, ProQuest; Alex Rodriguez and J. Michael Rodriguez, “ ‘A Wonderful Waltz’,” Chicago Sun-Times, June 16, 1998, NewsBank.

15 “With Citizens United, Now What?,” Chicago Tribune, November 1, 1997, ProQuest. A commentator for WMAQ-5 TV’s coverage of the 1998 rally told viewers that the event “shows the great cultural diversity of this city.” “Chicago Bulls Championship Rally, June 16, 1998 (Pt 1),” YouTube, August 15, 2012, accessed August 20, 2013, http://www.youtube.com/watch?v=qjD6a6rLxg4.

16 Reviews of the rallies were not universally positive. Some in attendance complained about the relatively short duration of the gatherings (usually less than an hour), and that some of the warm-up acts were tacky. See Scott Fornek and Tom Seibel, “Whoomp! A Perfect Cap for a Fan’s Day,” Chicago Sun-Times, June 98

It’s worth noting that, by the end of the twentieth-century, the notion that sport

could function as a driver of racial integration of American society was not limited to

journalists and boosters. In 1997, on the fiftieth anniversary of Jackie Robinson’s debut

with the Brooklyn Dodgers, ABC Nightline News commissioned a poll asking a random

sample of Americans, “Do you think that the presence of Whites, Blacks and other

minorities on sports teams helps, hurts, or has no effect on integration and reduction of

racial tension in other areas of life?” Overall, more than half of the respondents believed

that the integration of sports teams positively affected larger society, less than ten percent

believed that it hurt, and nearly forty percent told researchers that it had no effect.17

Despite the lack of consensus, the poll results revealed the belief among many Americans

that sport had the power to undermine longstanding patterns of segregation. Moreover,

disaggregating the poll responses by race (see Figure 2.2) shows no significant statistical

association between the race of the respondent and their opinions on the issue. In other

words, despite some nominal variation by race, whites appear to have been far from alone

in their belief in sport as a positive force behind racial integration.18

23 1993, NewsBank; Roeper, “Grant Park Sideshow.” However, those with complaints appear to have been in a minority. A homemade video of the 1996 celebration, for example, shows the crowd cheering loudly for the warm-up acts. “Da Bulls Celebration Rally,” YouTube, April 3, 2007, accessed August 20, 2013, http://www.youtube.com/watch?v=ID_bdNnZbTM.

17 Accounting for sampling weights, the 95% confidence intervals for each response were (48.7-56.5%), (6.3-10.9%), and (35.0-42.7%), respectively.

18 Some sports historians have offered a similar line of argumentation. For a recent example, see Charles Martin, Benching Jim Crow: The Rise and Fall of the Color Line in Southern College Sports, 1890-1980 (Urbana, IL: University of Illinois Press, 2010). 99

Helps Hurts Has no effect

60

54.38 50 49.74

43.52 44.23 40 42.31

37.37 30

20 Percent of Percent of Respondents

10 13.46 8.25 6.74 0 Non-Hispanic White (n = 388) Non-Hispanic Black (n = 193) Other race (n = 52) Respondent's Race

Figure 2.2. Reponses by Race to February 1997 ABC News Nightline Poll Question: “Do you think that the presence of Whites, Blacks and other minorities on sports teams helps, hurts, or has no effect on integration and reduction of racial tension in other areas of life?”a Source: ABC News (Inter-University Consortium for Political and Social Research, 1997). a Chi-squared analysis by author shows that responses were not statistically dependent on the race of the respondent (p = 0.309).

Of course, it’s hard to determine whether or not the mechanism by which the

Bulls brought fans together in Grant Park was the same as the one intimated by the poll

question (i.e. integrated teams serving as an example for integrated communities).

Nevertheless, some observers argued that Michael Jordan in particular functioned as a

civic hero around which African-Americans, whites, and people from other ethnic and racial backgrounds could all rally. After the first championship run in 1991, sociologist

John Koval told the Washington Post that Jordan offered white Americans a safe and reassuring black icon. “[Jordan] fills all the needs of white, middle-class Americans,”

100

Koval explained. “He’s a nice guy, he speaks well…he doesn’t threaten middle-class

America.”19 And it wasn’t just sociologists who made this claim. For example, in 1997,

Denver Nuggets guard Bryant Stith attributed the popularity of the Bulls to the fact that their “leader [Jordan] appeals to the majority of people in the entire sports arena.”20

But it was more than the mass appeal of Jordan or the power of sport to transcend racial divisions that unified the fans who gathered in Grant Park after the Bulls’ championships. In fact, press accounts of the rallies suggest that, besides their love of

Jordan, what linked the celebrants together was the fact that most of them “couldn’t get tickets” to actual games.21 Indeed, by the 1990-91 NBA season, the cheapest ticket to a

Bulls game at Chicago Stadium, a standing-room only admission to the second balcony, cost $14, while the average ticket price was closer to $30.22 No doubt, even the cheap seats stood out of reach for many Chicagoans, especially those who resided in nearby public housing projects like the Henry Horner Homes.

19 Edward Walsh, “Chicago Savors a Rare Title,” Washington Post, June 14, 1991, LexisNexis.

20 Jack McCallum, “A Cut Above: More Than Ever It Seems No Team Can Catch the Bulls,” Sports Illustrated 86, Issue 10 (March 10, 1997): 24-29, SPORTDiscus. Since the mid-1990s, a cottage industry of cultural studies research has sharply criticized the interpretation of Michael Jordan’s success with the Bulls by media and fans as confirmation of “a colour-blind and post-racial America.” David Andrews and Ron Mower, for example, argue that “Jordan provided a template of how a black male was able to ingratiate himself to the mythos of Middle America” while deftly avoiding acknowledgement of persistent racial inequity within American society. According to them, Jordan thus emerged as one of the most important popularizers of the “regressive” idea that people of color in the U.S. were no longer stymied by systemic barriers to wealth or acceptance. That a black man could be welcomed with awe and admiration by millions of white Americans deceived many, they believe, into believing that individual determination and personal responsibility mattered more than race in determining one’s place in society. David Andrews and Ron Mow, “Spectres of Jordan,” Ethnic and Racial Studies 35, no. 6 (2012): 1062, 1063, 1073. For similar critiques, see Michael Eric Dyson, “Be Like Mike?: Michael Jordan and the Pedagogy of Desire,” Cultural Studies 7, no. 1(1993): 64-72; Cheryl Cole, “American Jordan: P.L.A.Y., Consensus, and Punishment,” Sociology of Sport Journal 13, no. 4 (1996): 366-397; David Andrews, ed., Michael Jordan Inc.: Corporate Sport, media Culture, and Late Modern America (Albany, NY: SUNY Press, 2001).

21 Melissa Isaacson, “ ‘Celebration’ Fun for Almost All.”

22 Lacy Banks, “Tickets Available, But Buyer Beware,” Chicago Sun-Times, October 31, 1990, NewsBanks. 101

The fact that many of the fans in Grant Park had been priced out of seeing actual

games often emerged when the local press described the presence of children from

impoverished neighborhoods on the West and South Sides. Tracy Brill, a teacher at

Brown Elementary School (a block east of Chicago Stadium) assumed the job of

chaperone when City Hall reserved up-front seats at the 1991 rally for several students from the virtually all-black campus. Speaking to the Tribune, Brill explained, “they live

so close to the stadium, and yet they don’t get to be a part of it…Now they finally get to

be a part of the celebration and a part of the Bulls.”23 As the Sun-Times put it two years

later in its coverage of the 1993 celebration, “normally heroes cost you money…Not

today…Today you get Chicago’s full cast of superheroes—Jordan, Paxson, Pippen…and

all the rest—for free. All you need to do is go to Grant Park and be prepared to do a lot of

standing on tiptoe.”24

In the wake of the 1996 festivities, the Tribune devoted an entire story to a group

of kids from the Robert Taylor Homes on the city’s South Side who, along with their

parents, got the chance to see the Bulls in Grant Park thanks to the sponsorship of a local

non-profit. These particular children weren’t lucky enough to get reserved seating up

front, and they “were sweating in a human pyramid…hoping to catch a glimpse of the

man of their hoop dreams” (Figure 2.3). But despite the difficulty the kids had in seeing

Michael Jordan, the paper assured readers that these fans “highlighted the grit and

gumption of a crowd of sports fans from all walks of Chicago life.”25

23 Papajohn and Wilgoren, “Hundreds of Thousands Reach Out, Touch Bulls.”

24 Ray Long, “Free-for-All Festivity to Laud Bulls,” Chicago Sun-Times, June 22, 1993, NewsBank.

25 Jerry Thomas and Paul Salopek, “NBA Champion Chicago Bulls Fan-Tastic Day in Grant Park,” Chicago Tribune, June 19, 1996, ProQuest. 102

Figure 2.3. David Hobart, 8, from the Grand Boulevard neighborhood on Chicago’s South Side, perches on a friend’s back in order to catch a glimpse of the Bulls in Grant Park, 1996. Source: Greer (1996).

As much as the media’s sanguine reporting on the presence of children from

Brown Elementary and the Robert Taylor Homes seemed to support the Bulls-as-civic- glue thesis, the admission that the rallies were the best that these kids could hope for belied such an idea. Fandom in Chicago proved a tiered experience dependent first and foremost on whether or not one had access to the resources necessary to participate fully in a spectator sports marketplace in which owners of stadiums and arenas prioritized the production of exchange value. The rallies were a consolation prize for “the ones without clout, without connections, without cash for a courtside ticket,” as the Sun-Times put it.26

26 Neil Steinberg, “Fan-Tastic!-150,000 Cheer Bulls at Lakefront Rally,” Chicago Sun-Times, June 22, 1993, NewsBank. 103

The newspaper coverage made it clear that this group included more than just poor Chicagoans. Many suburbanites told reporters that, for them too, the gatherings at the park presented their lone opportunity to see the home team in person. When asked why he showed up in the middle of the night before the first championship rally, Tom

Bare of Des Plaines explained that it was his one shot to see the team anywhere other than on the television screen. “I can’t get Bulls tickets,” Bare said. “This is the only way to show my appreciation [to the players]. I’d like to just get close to one of them.”27 At the 1993 rally, 17-year-old Scott Fredericks of Evergreen Park shared a similar story. “I don’t get to go to any games, so you’ve got to see the players somehow…You got to do something to show your support,” he told the Tribune.28 Amtrak employee Carlos

Medina from Cicero commented to a reporter covering the 1998 rally that “this is a big day…this is a day for people who can’t afford to buy tickets.”29

Instead of lamenting the fact so many Chicagoans never had the opportunity to attend an actual Bulls game, the media focused on how these fans—public housing tenants and suburbanites alike—formed one big, authentic community of Bulls supporters. Reflecting on the 1996 championship rally in Grant Park, Leslie Baldacci of the Sun-Times asked, “Who were those people standing in the sun, the mud, humidity and humanity for hours Tuesday for a brief sighting of the Bulls?” Her answer:

They were people who’ve never seen the inside of the United Center but for whom seeing isn’t a prerequisite for believing. This was definitely not the fur-coats-and-diamonds, see-and-be-seen courtside crowd…I don’t

27 Melissa Isaacson, “ ‘Celebration’ Fun for Almost All,” Chicago Tribune, June 15, 1991, ProQuest.

28 Andrew Gottesman, “Celebration! 150,000 Frans Scream Appreciation of Their 3-Time Champion Bulls Tuesday at Grant Park Rally,” Chicago Tribune, June 22, 1993, ProQuest.

29 Rodriguez and Rodriguez, “A Wonderful Waltz.” 104

know what the [Bulls] organization calls this element that cannot buy its way into games, but I call them great fans.30

Rick Telander, covering the following year’s rally, agreed that the celebrants in Grant

Park comprised the gritty core of Bulls fandom. “You wonder about the people who line

up for a show like this, but then you remember: There are millions of folks who can’t get

into the United Center with the wealthy swells to see their heroes at work.”31

While the papers reveled in the seeming authenticity of the Grant Park crowds

made up of “younger, less-affluent folks in T-shirts and shorts, bandanas and jeans,” it

was clear that the fans who participated did so not simply because of their dedication.32

They did so because, for most of them, the celebrations were their one and only shot to

see Jordan and company in the flesh, even if from a distance. As much as the rallies

embodied the diversity of an expansive community of Bulls fans in Chicago, they also

betrayed the fact that how one experienced fandom depended in large part on his class

position. Unfortunately for those at the rallies, this was exactly the way the team’s

ownership wanted it.

Spectatorship and Class at Chicago Stadium and the United Center

Concerns among Bulls fans about the cost of attending games predated the

championship runs of the 1990s. Throughout the seventies and early eighties, vocal

basketball enthusiasts in Chicago expressed their displeasure with repeated decisions by

then Bulls owner Arthur Wirtz to raise ticket prices. In November 1973, for example, the

30 Leslie Baldacci, “Ups and Downs for Bulls Fans,” Chicago Sun-Times, June 23, 1996, NewsBank.

31 Rick Telander, “Bulls Know How to Throw Party,” Chicago Sun-Times, June 17, 1997, NewsBank.

32 Rick Telander, “Bulls’ Fourth Title Celebration a Timely Affair,” Chicago Sun-Times, June 19, 1996, NewsBank. 105

Tribune published comments by several Bulls fans furious with the team’s decision to

charge $6.75 for certain seats that had sold for $3 the previous season. Geoff Hiller from suburban Highland Park fumed over “being stabbed in the back by the bush league ticket-

selling practices of management,” and fellow fan Dietrich Wolframm of Hinsdale,

another Chicago suburb, asserted that “what has really happened is that the fans cannot afford the Bulls.” “We still love them,” Wolframm continued, “but Wirtz and company have ripped us off.” Arlington Heights resident John McHugh added that he hoped the

American Basketball Association (ABA)—the NBA’s rival league which dissolved a few years later—would expand into Chicago so fans had a cheaper alternative. “I’ll be at their

[ABA] games,” he wrote, “as well as a large number of ex-Bull ticket buyers.”33

The discontent percolated through more than just the Chicago suburbs. Early in

1974, Bulls coach Dick Motta reluctantly conceded to a reporter that few apart from

“corporate” ticket-buyers could manage to pay for consistent access to Chicago Stadium

to watch the Bulls. “The average family man cannot afford to buy a season ticket. Even I

can’t afford to take my wife and children to every game,” Motta explained. He went on,

“and something I would like to see would be some seats that the black people who live

near here could afford.”34 According to data collected by the Tribune, Motta and Bulls

fans had good reason for concern. In 1977 the paper reported that over the course of the

33 “Bulls’ Management Angers Fans,” Chicago Tribune, November 6, 1973, ProQuest. In 1976, the NBA absorbed four ABA squads: the Denver Nuggets, Indiana Pacers, New York Nets, and San Antonio Spurs. See Terry Pluto, Loose Balls: The Short, Wild Life of the American Basketball Association (New York, NY: Simon & Schuster, 1990).

34 Robert Markus, “Bulls Win Games, But Management Must Win Fans,” Chicago Tribune, February 19, 1974, ProQuest.

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previous decade the nominal price of an “average seat” at a Bulls game had more than

doubled.”35

Local commentators made special note of the fact that the cost of premium

seating had also ballooned. The Tribune explained that, at over $10 a ticket by the mid-

1970s, only those with a “corporate connection, a secret source with clout, or…willing to

throw [themselves] at the mercy of scalpers” could hope to land courtside seats to watch

the Bulls.36 The bad news for fans in search of a spot close to the action continued during

the early 1980s. In May 1981, the team notified season ticket holders that the price of

courtside seats for the following season would be $13.50 apiece, a 50 percent jump. By

the 1984-85 season, Michael Jordan’s rookie campaign with the squad, courtside seats

had climbed to $15 dollars each.37

In real terms, however, the price of tickets appears to have held relatively steady during the seventies and early eighties. Unfortunately, we don’t have the data necessary to calculate average ticket prices prior to the 1990s.38 However, the local press occasionally reported on the maximum and minimum ticket prices to see the Bulls play at

Chicago Stadium, and Figure 2.4 shows the reported cost of courtside seats (the most expensive) and second balcony seats (the least expensive). The graph shows that, after adjusting for inflation, both tickets actually cost less in Jordan’s rookie season (1984-85)

35 Don Pierson, “Ticket Prices: Outa Sight!,” Chicago Tribune, March 20, 1977, ProQuest.

36 Neil Milbert, “Cubs, Sox, Bears Tickets Are Endangered Species,” Chicago Tribune, August 7, 1977, ProQuest.

37 Dave Jones, “Sports Briefing: Bulls Boost Ticket Prices,” Chicago Tribune, May 7, 1981, ProQuest; "Bulls Raise Ticket Prices," Chicago Tribune, June 13, 1985, ProQuest. Jones’s article uses the term “box seats,” which, in the context of previous and subsequent reports on ticket prices, appears to be a synonym for courtside seats.

38 Calculating an accurate average would require price data for every section in Chicago Stadium, in addition to the number of seats in each section (in order to properly weight the average). 107

than they had a decade earlier. Admittedly, the data represents only two seating sections

from Chicago Stadium, but it nonetheless suggests that anger over ticket prices owed less

to the fact that pro basketball had abandoned the ordinary fan, and more to do with the

fact that owners like Wirtz were trying to keep pace with record-setting inflation. As the

Tribune observed in 1977, the prices charged by the Bulls were “popcorn compared to

the general cost of living increase over the last 10 years.”39

Most expensive (courtside) Least expensive (second balcony)

$350.00

$300.00

$250.00

$200.00

$150.00 1995 Dollars

$100.00

$50.00

$0.00 1970-71 1973-74 1976-77 1979-80 1982-83 1985-86 1988-89 1991-92 Season

Figure 2.4. Real Cost of Most Expensive (courtside) and Least Expensive (second balcony) seats for the Bulls, 1970/71-1993/94. Source: Chicago Tribune; Chicago Sun-Times. a Inflation adjustments made using CPI-U for Chicago MSA.

Things changed, however, after real estate mogul and Chicago White Sox owner

Jerry Reinsdorf purchased a controlling interest in the Bulls in 1985, and quickly set out

39 Don Pierson, “Ticket Prices: Outa Sight!”

108

to capitalize on the increasing demand for tickets generated by the exciting play of a young Michael Jordan and the growing popularity of the NBA in general.40 Figure 2.4 reveals that the arrival of Reinsdorf and Jordan coincided with the spectacular growth in the price for high-end seats. By the 1993-94 season the price tag for the best courtside seats in the house had surged to $300.00, more than a 1300% increase since 1984-85 in real terms. The cheapest seats in the house had also become much more costly, even if at a slower rate. During the 1993-94 season, fans had to fork over $19 dollars for a nosebleed seat to watch the Bulls from the second balcony, a greater than 200% jump in real terms from a decade before. The concurrent increase in real per capita personal income in the Chicago region—approximately 15%—paled in comparison during the same period.41 If regular Bulls fans had been concerned earlier about their ability to keep up with rising prices, by the end of the 1980s they had good reason to panic.

40 Steve Daley, “Reinsdorf Shows He’s All Business,” Chicago Tribune, February 9, 1985, ProQuest. Under Reinsdorf, ownership of the Bulls has been structured as a “limited partnership” (LP) consisting of one “general partner” with total control over franchise operations and several “limited partners” or outside investors “without any control or say in how the business operates.” Since the purchase in 1985, Reinsdorf has maintained exclusive ownership over CBLS Corporation, the entity designated as the general partner for the Chicago Professional Sports Limited Partnership (the official name of the Bulls LP). The Bulls LP also has a 10-person board of directors (an optional entity for an LP). Despite the presence of other investors, I refer to Reinsdorf as the “owner” of the Bulls henceforth in light of his unilateral authority in running the franchise. Melissa Harris and Jared S. Hopkins, “Chicago Sports Ownership: The Chairman,” Chicago Tribune, July 28, 2013, Chicago Sports, 8-9. For more information on the Bulls limited partnership filings, see “Chicago Professional Sports Limited Partnership,” Illinois Secretary of State Cyberdrive, File Number C006725, accessed September 21, 2013: http://www.ilsos.gov/lprpsearch/search.do.

41 Bureau of Economic Analysis, “Personal Income Summary,” Table CA1-3 (Washington, D.C.: U.S. Department of Commerce, 2012), http://www.bea.gov/iTable/index_regional.cfm. This data is for the Chicago-Joliet-Naperville (IL-IN-WI) Metropolitan Statistical Area (MSA), and is derived from Census Bureau midyear population estimates. The per capita measure likely overstates growth, as individuals and households at the right tail of the income distribution are likely to skew such a statistic. Numbers reported by the Census Bureau indicate that, between 1979 and 1989, median family income (real) in the Chicago MSA increased approximately 7 percent. See U.S. Census Bureau, “Median Household Income by Metropolitan Statistical Areas (MSAs): 1969, 1979, and 1989” (Washington, D.C.: U.S. Department of Commerce, 2010), http://www.census.gov/hhes/www/income/data/historical/metro/msa1.html. 109

The Reinsdorf/Jordan era marked a demographic shift at Chicago Stadium.

Immediately after Reinsdorf took the reins of the franchise in 1985, the Tribune

celebrated the fact that within a few months he had “transformed a onetime blue-collar

operation into an upscale franchise” by “taking a page from the Los Angeles Lakers and

other NBA teams selling courtside ‘Jack Nicholson seats’ at $30 a game.”42 “Corporate”

clientele was nothing new at Chicago sporting events, but anecdotal evidence suggests

that local elites became a more central part of the fan base at Chicago Stadium after

Jordan’s arrival. In 1986, investment banker David Chamberlain told the Tribune about

his use of tickets to entertain clients. “Everybody’s talking about the Bulls…There’s

always a clamoring for tickets by my clients. I’ve seen three games, and…my clients

loved it. These are all successful, wealthy guys and a lot of them still play basketball.”

Bulls Vice President David Rosengard bragged about the prominent city officials and A-

list celebrities bidding for tickets to see Jordan. “You know you’re doing well when

people like Burt Reynolds and folks from the mayor’s staff call you up and want tickets,”

he explained.43 As the team’s successes mounted, so did demand from high-profile fans.

A few months after the Bulls’ first NBA title in 1991, director of ticket and stadium

operations Joe O’Neil commented, “whenever there is a movie being shot in town, I can

expect calls from the leading artists wanting to go to games. Last week, I got a call from

Dustin Hoffman.”44

42 Bob Sakamoto, “Upbeat Bulls Go Upscale but Can the Team Move Up in NBA Standings?,” Chicago Tribune, September 22, 1985, ProQuest.

43 Bob Sakamoto, “Bulls Convert Fast Start Into Ticket Sales,” Chicago Tribune, November 26, 1986, ProQuest.

44 Lacy Banks, “Hottest Ticket Gets Hotter,” Chicago Sun-Times, October 30, 1991, NewsBank. 110

Some less recognizable fans saw the increasing popularity of the Bulls among the wealthy as a threat. In a 1990 letter to the Sun-Times, Chicagoan Thomas Swanborn lamented the changing face of the crowd at the stadium:

With the high ticket prices comes a change in fans. Instead of real Bulls fans, the Stadium now is a haven for yuppies to show off their money. A fan standing and cheering now is susceptible to the wrath of a pompous yuppie. These people are turning the good old game of hoops into a high- society social event.45

The sentiment persisted in the years to come. In 1993, Al Carli, a Sun-Times reader from

Chicago’s Archer Heights neighborhood, entreated Reinsdorf and the Bulls to cater less to celebrities and “give the little people a break.” “One of these days,” Carli predicted,

“there just won’t be enough people left with money enough to buy one of those overinflated tickets.”46 For people like Swanborn and Carli, the apparent proliferation of

“yuppies” at Chicago Stadium represented an unwelcome takeover.

Skeptics of the argument that “little people” were finding it more and more difficult to see the Bulls in person might respond that, as the data in Figure 2.4 shows, well into the mid-nineties Bulls fans could secure tickets for less than $20. But despite the wide range of ticket prices, tickets that regular fans could afford were becoming much harder to come by. One reason was the spike in season ticket sales that took place during the late 1980s. Riding the coattails of Jordan’s emerging stardom, the team sold a record

4,800 season ticket packages for the 1986-87 season, and this number shot up to 11,200 the next year. While Bulls Vice President for Marketing Steve Schanwald assured fans in

1988 that the team would limit season ticket sales to 13,000 in subsequent seasons in

45 “View of Sports,” Chicago Sun-Times, January 7, 1990, NewsBank.

46 “Union is Fighting Injustice,” Chicago Sun-Times, October 26, 1993, NewsBank.

111

order not to “shut out fans who can’t afford season tickets,” this meant that approximately 70 percent of the seats in Chicago Stadium would typically be occupied by those who could afford the thousands of dollars necessary to buy season tickets.47

On top of the season ticket situation, the average real cost of attending a game at

Chicago Stadium continued to rise steeply during the early 1990s, during which time the team charged considerably more than its NBA peers for access. Data on ticket prices for

NBA teams compiled by the sports marketing trade publication Team Marketing Report shows that, on average, the inflation-adjusted price of attending Bulls games at the

Stadium went up more than seventeen percent between the 1991-92 and 1993-94 seasons

(Figure 2.5). By the 1993-94 season, the nominal average ticket price had reached

$36.45, and the Bulls’ “Fan Cost Index”—a figure aggregated by Team Marketing Report which included the price of four average-priced tickets, four small soft drinks, four regular hot dogs, parking for one car, two programs, and two of the cheapest adult-sized caps—stood at $215.80 (a more than 11% jump in real terms from two seasons earlier).

Both of these figures exceeded the league averages, which stood at $27.13 and $168.68,

47 Lacy Banks, “Suddenly, Bulls are a Hot Ticket,” Chicago Sun-Times, February 19, 1988, NewsBank; Merrill Goozner, “Michael Jordan & Co. Fuel Chicago’s Bull Market,” Chicago Tribune, May 1, 1988, ProQuest; Linda Kay, “Odds & INS,” Chicago Tribune, April 28, 1988, ProQuest; Toni Ginnetti, “Bull Marketers Build for Long-run Success,” Chicago Sun-Times, November 1, 1989, NewsBank. Presumably, some of the seats in the cheaper balcony sections were gobbled up as season tickets, meaning that many seats normally within reach of fans of more modest means were probably unavailable. The Bulls also offered several hundred “standing room only” tickets for each game which cost slightly less than the cheapest balcony seat. However, this was a miniscule proportion of overall capacity, and the number of these tickets made available was cut considerably over the course of the 1990s due to concerns with standing fans obstructing the views of those with seats. On the standing-room-only situation, see Fred Mitchell, “Bulls Stand Up for Seated Fans During Playoffs,” Chicago Tribune, April 14, 1998, ProQuest. One way that less wealthy fans may have gained access to the United Center is through ticket giveaways. In 1996 Reinsdorf reported donating 250 tickets for each game to local schools, and there is limited anecdotal evidence of giveaways by local corporations. The number of these giveaways involving season-tickets (or relatively expensive seats) is impossible to determine. See Skip Myslenski & Linda Kay, “Odds & INS,” Chicago Tribune, November 14, 1986, ProQuest; Bob Herguth, “Reinsdorf Talks About His Teams,” Chicago Sun-Times, May 19, 1996, NewsBank.

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respectively, by large margins.48 As these numbers demostrate, by the time the Bulls achieved championship status, Chicagoans—especially those with families—had to commit a considerable amount of resources to experience the action first hand. This was not simply a matter of inflationary pressures; watching live professional basketball in

Chicago was becoming geared more and more towards those with deep pockets.

Figure 2.5. Average Ticket Prices, Chicago Bulls and Rest of the National Basketball Association, 1991/92-2001/02.a Source: Fort, “NBA Ticket Prices,” (2013). Based on data from Team Marketing Report. a For individual team calculations, averages weighted by number of seats at each pricing level. “Rest of NBA” is simple mean of the weighted averages of all teams except the Bulls. Figures do not account for luxury suites/boxes. Inflation adjustments made using CPI-U (national) matched to year in which season concluded.

48 “NBA Fan Cost Index,” Rodney Fort’s Sports Business Data, data based on estimates from Team Marketing Report, updated May 7, 2013, accessed August 20, 2013, https://umich.app.box.com/s/41707f0b2619c0107b8b/1/320022929. 113

Survey research dealing with the socioeconomic status of Americans attending

live sporting events in the late eighties and early 1990s invariably corroborates the

conclusion that, by the end of the twentieth century, the demographics of attendees at

these events skewed decidedly in the direction of those on the high end of the

socioeconomic spectrum. In July 1986, American Demographics, a market research trade

publication, summarized data collected by the Simmons Market Research Bureau

showing that for most of the sports analyzed—the NBA included—“the higher the

household income, the more likely the person is to attend the game.” Data from fans also

revealed that for all of the sports examined with the exception of professional wrestling,

survey respondents with a college degree were “more likely to attend” than those

without.49

Economists John Siegfried and Timothy Peterson came up with similar results

when they mined the 1994 Consumer Expenditure Survey—an annual survey conducted by the Bureau of Labor Statistics that tracks the purchases of thousands of individuals— for information about those who bought tickets. They found that respondents who paid for admission to a sporting event had, on average, pre-tax family incomes (weighted by the amount of expenditures on admissions) 1.8 times greater than those who did not

(Table 2.1). Moreover, these results almost certainly understate the gap between the two groups during the early 1990s, since the survey “top-coded” reported family income at

$300,000 (i.e. reported any incomes above $300,000 as $300,000), and also failed to

49 Max Yergin, “Who Goes to the Game?,” American Demographics (July 1986): 42-43. The sports covered in the article include baseball, pro football, college football, college basketball, pro basketball, ice hockey, boxing, wrestling, golf, and tennis. According to the Yergin, “the game most favored by the wealthiest households (those with incomes of $40,000 or more a year) is ice hockey by a wide margin.” Unfortunately, the article does not include exact numbers on pro basketball.

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capture expenditures made by corporate entities for the purposes of entertaining employees and clients.50

Table 2.1. Income Levels of Consumers by Attendance at Sporting Events, 1994. Pre-Tax Family Income b c Simple Mean Weighted Mean Median Consumers who purchased tickets to sporting eventsa $48,288 $56,124 $42,663

Consumers who did not purchase tickets to sporting events $30,350 $30,350 $22,258

Ratio of purchasers to non- purchasers 1.59 1.85 1.92 Source: Reproduced from Siegfried and Peterson (2000). Based on data from the Bureau of Labor Statistics’ 1994 Consumer Expenditure Survey. a Includes all respondents who reported spending any amount of “admission fees to sporting events” and/or “admission fees to sporting events on out-of-town trips.” The annual survey is based on four quarters of data. In 1994, “tickets to sporting events were purchased by an average of 5.6 percent of the consumer units each quarter,” yielding a total of 1,147 consumer units in the “purchased tickets” group for the entire year. b The difference between the means is statistically significant (99 percent confidence level). c Weighted by total amount of expenditures made by respondents on event attendance.

In a subsequent analysis, sociologist Thomas Wilson examined data from the

1993 General Social Survey (GSS), which asked respondents from a nationally representative sample of Americans whether or not they had attended an amateur or professional sporting event in the previous twelve months. Wilson’s analysis reveals that, after introducing relevant controls, respondents’ family income and educational attainment were both positively and significantly correlated with the likelihood of having gone to a sporting event, with educational attainment exhibiting a slightly larger effect

50 John Siegfried and Timothy Peterson, “Who Is Sitting in the Stands? The Income Levels of Sports Fans,” in The Economics of Sports, ed. William Kern, 51-74 (Kalamazoo, MI: Upjohn Institute for Employment Research, 2000), 63. 115

size.51 Since Wilson employed a statistical technique (“Multiple Classification Analysis”)

that does not lend itself to estimating the effect of individual- and household-level

variables on the probability and/or odds of an individual’s attendance—it only identifies

whether an effect is present and its strength relative to other independent variables—I

replicated his analysis using a multiple regression model. The methodology and results

for this model are outlined in detail in Appendix A, but the key results include: 1) all else

being equal (i.e. controlling for age, race, sex, whether or not respondent has children,

and whether or not respondent lives in an “urban” community), in 1993 each additional

$10,000 in family income was associated with a 13 percent increase in the odds of having

attending a sporting event; and 2) all else being equal, in each additional year of

education was associated with a 18 percent increase in the odds of attendance.52 The

“predicted probability curves” in Figures 2.6 and 2.7 present these relationships in

graphic form, showing the probability of attendance for a particular subset of the

population as a function of income and education, respectively.

Because of the survey design, it’s safe to assume that the estimates from the GSS

do not capture the full strength of the association between resources and the odds of

having attended a professional sporting event like a Bulls game. The survey lumped

together “amateur” and “professional” sporting events when it asked respondents about

their attendance. Since amateur events like high school contests cost less—if anything—

51 Thomas Wilson, “The Paradox of Social Class and Sports Involvement,” International Review for the Sociology of Sport 37, no. 1 (March 2002): 5-16.

52 This interpretation is the same as saying that each additional $10,000 in family income increases the odds of having attended a sporting event by a factor of 1.13, and each year of education increases the odds by a factor of 1.18. Or, a one standard deviation increase in income increases the odds by a factor of 1.45, while a one standard deviation increase in education increases the odds by a factor of 1.63. A model using a log transformation of family income did not affect the direction, effect size, or significance of the coefficients in any substantive way, though it did provide a marginally better model fit. For ease of interpretation, the figures reflect the model without the transformation. See Appendix A for more details. 116

to attend, the positive correlation between income and likelihood of attending a sporting

event most likely would have been more pronounced if the survey question asked about

professional events only. Either way, all of the survey research cited above converges around the same observation: by the time Jordan and the Bulls were household names, the people in the stands at sporting events were typically wealthier and better educated than the average American.

1

0.9

0.8

0.7

0.6

0.5

0.4

0.3 Probability Attendance of Probability

0.2

0.1

0 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000 Family Income (1992 Dollars)

Figure 2.6. Predicted Probabilities of Attendance at an Amateur or Professional Sporting Event in 1992 as Function of Family Income (for white males, 45 years of age, with 13 years of education, living in urban areas, and with at least one child). Source: National Opinion Research Center (1993).

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1.0

0.9

0.8

0.7

0.6

0.5

0.4

0.3 Probability Attendance of Probability

0.2

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0.0 0 2 4 6 8 10 12 14 16 18 20 Education (Number of Years)

Figure 2.7. Predicted Probabilities of Attendance at an Amateur or Professional Sporting Event in 1992 as Function of Years of Education (for white males, 45 years of age, from a family reporting $32,499 in annual income for 1992, living in urban areas, and with at least one child). Source: National Opinion Research Center (1993).

Admittedly, one of the weaknesses of these data is that they tell us little about change over time. That is, they provide few if any clues as to whether or not there was anything new about wealthier and more educated Americans being more likely to be in the stands at major league stadiums and arenas.53 There are, however, other clues suggesting that, while this dynamic was not entirely novel, by the last two decades of the twentieth century it had become especially pronounced. For example, to supplement their

53 Several sports historians note that, since the late nineteenth century, the organizers of commercial sporting events have targeted relatively affluent audiences, or at least “middle-class” audiences as opposed to working-class ones. However, their research also suggests that by today’s standards ticket prices at major-league events were relatively low. For example, tickets to premier baseball games in the late nineteenth century often sold for between twenty-five and fifty cents (less than $10 when converted to 2013 dollars). Moreover, according to historian Steven Riess, some leagues went out of their way to cater to working-class fans. See George Kirsch, The Creation of American Team Sports: Baseball and Cricket, 1838-72 (Urbana, IL: University of Illinois Press, 1989); Steven Riess, City Games: The Evolution of American Urban Society and the Rise of Sport (Urbana, IL: University of Illinois Press, 1989). 118

analysis of the 1994 Consumer Expenditure Survey, Siegfried and Peterson looked at an

earlier version of the survey from 1972-73. The median income level among those who

spent money on individual-game tickets in these years was 10 percent more than overall

median income. The median income among those who spent money on season tickets

was 58 percent more than the overall figure. By contrast, the median income among

respondents from the 1994 survey who spent anything on tickets of any kind stood at 84

percent above the overall median.54

Information circulating among sports marketing professionals during the late

eighties and early nineties also indicated a demographic shift at stadiums and arenas

towards those with higher incomes and more luxurious tastes. A September 1988 issue of

Athletic Business, a prominent sports marketing trade publication, suggested that the era of hot dogs and watery beer was giving way to something more sophisticated and expensive. “The future holds many exciting challenges as the trend away from bare necessities to convenience and luxury continues,” it told its readers. In subsequent years, the story remained the same. A May 1991 issue quoted sports facilities management consultant Chris Bigelow, who asserted, “the trend is upscale products and a higher level of service.” In May 1994, the publication explicitly singled out the NBA in its discussion of this “trend.” “Many sports spectators—particularly in basketball, where demographics

54 Admittedly, this data is suggestive, since survey definitions were not constant in early iterations of the Consumer Expenditure Survey. Siegfried and Peterson, “Who Is Sitting in the Stands?,” 62. Note that this last figure differs from the one indicated in the bottom right cell in Figure 2.1, since it was produced by dividing by the “overall” median rather than the median for consumers who did not purchase tickets. A 1996 article in American Demographics attempted to make a similar point about Major League Baseball fans, noting that “people with household incomes of $50,000 or more were more likely in 1995 than in 1985 to attend baseball games.” However, given the fact that the article appears to make no adjustments for inflation, it may not reflect a comparison of similar income groups. Shannon Dortch, “The Future of Baseball,” American Demographics (April 1996): 24. 119

have shifted considerably toward more upscale consumers—will pay a premium for

better service or accommodations,” it explained.55

In Chicago, nothing encapsulated these trends more than the Bulls’ transition to

the United Center, a dual-use basketball/hockey arena that opened in the summer of 1994

across the street from Chicago Stadium on the city’s Near West Side (see Map 2.1).

Before it shut down, the old Chicago Stadium contained a single, 50-person luxury box that leased for $5,000 per game to corporations or wealthy fans willing to pay for an upscale experience. The United Center boasted 216 twenty-, forty-, and sixty-person luxury suites (or “skyboxes”) that leased annually for anywhere from $55,000 to

$175,000, a price that included full catering, a private bar, a private attendant, and plush furniture among its many amenities. In addition to the suites, the new arena offered several thousand “club seats,” or expensive non-enclosed seats (usually purchased as season tickets) which offered patrons access to exclusive concessions and entertainment areas for $40/game and a $1,000 annual membership premium.56 The perks of club

access were no joke. According to a 1996 review of the arena in Crain’s Chicago

Business:

Pampered enthusiasts in the club seats never wait in line. Their orders are recorded by servers equipped with hand-held keypads that send low- frequency radio signals to one of four small satellite dishes. Once an order

55 Pamela Scott, Jane Templeman, and Michael Lischer, “Stadiums Designed for the Winning Tradition,” Athletic Business, September 1988, 82, Amateur Athletic Foundation Library; Andrew Cohen, “Concessions Come of Age,” Athletic Business, May 1991, 62, Amateur Athletic Foundation Library.

56 Ginnetti, “Bull Marketers Build for Long-Run Success”; Brian Hewitt, “Bulls’ Center of Controversy,” Chicago Sun-Times, March 20, 1994, NewsBank; “United Center Suites: Day-of-Event Rental Suites, 2012/2013,” Unitedcenter.com, n.d., accessed August 20, 2013, http://www.unitedcenter.com/assets/1/7/ 1213_rental_suite_brochure.pdf. According to the Bulls website the United Center currently contains 3,000 club seats. “Lexus Club,” Unitedcenter.com, n.d., accessed August 20, 2013, http://www.unitedcenter.com/premium/ lexus-club/. 120

is keyed in, it’s transmitted to the nearest kitchen, where the order is filled and delivered in less than eight minutes.57

Admittedly, luxury boxes and club seating were not a new spectatorship

phenomenon; the first handful of major league luxury suites debuted in 1965 at the

Houston Astrodome (home of Major League Baseball’s Houston Astros). But it wasn’t

until the mid-1980s that professional team owners began looking to premium seating as a

centerpiece of their growth and stadium-finance strategies.58 In 1987, the National

Football League’s Miami Dolphins helped set the trend when they moved to a new

stadium containing 216 skyboxes (with annual price tags of $29,000-65,000) and 10,211 club seats ($600-1,400 per year).59 The NBA’s Detroit Pistons imported the model to the

NBA shortly thereafter, when the Palace of Auburn Hills opened with all 180 of its

luxury boxes leased for between $30,000 and $120,000.60

Jerry Reinsdorf and Chicago Blackhawks owner Bill Wirtz (who was also a

limited partner and board member in the Bulls franchise during the 1990s) allegedly

hatched the plan for the new arena after noting the financial success of the Palace, and by

the mid-1990s a robust skybox market had become the norm in the NBA.61 In 1988 and

1989, five other NBA arenas opened in addition to the Palace at Auburn Hills, and the

57 Jeff Borden, “High-Tech Heaven,” Crain’s Chicago Business, November 11, 1996, ProQuest.

58 Melvin Helitzer, The Dream Job: $port$ Publicity, Promotion and Marketing (Athens,OH: University Sports Press, 1996), 5.

59 Don Pierson, “Dolphin Plan Hits Jackpot,” Chicago Tribune, April 19, 1987, ProQuest.

60 The Palace also offered 3,000 club seats. Bob Ryan and Jackie MacMullan, “Ainge Lost the Touch,” Boston Globe, June 4, 1988, ProQuest; John Helyar, “For Team Owners, More Is Never Enough,” Wall Street Journal, May 3, 1996, ProQuest.

61 Sam Smith, “Bulls Notes,” Chicago Tribune, December 8, 1988, ProQuest. For lists of team partners, see Chicago Bulls Official 95-96 Yearbook (New York, NY: Sports Media, Inc., 1995), Chicago History Museum. 121

average luxury box count among them stood at about thirty. Among the eleven NBA

arenas that opened between 1990 and 1996, that number rose to approximately ninety.62

Commentators offered many explanations for the rush to construct skyboxes,

especially owners’ alleged concerns about the prospect of slowed growth in the price paid

by national and local networks for rights to broadcast NBA games and the specter of

increased player salaries.63 Whatever the exact set of motivations, premium seating

offered owners expanded and predictable revenue streams. Estimates compiled by

Financial World magazine show that “venue-related revenues” (i.e. earnings from suite rentals, concessions, parking, and in-stadium advertising) produced by the United Center were three times those generated by Chicago Stadium (see Table 2.2). Moreover, the high demand among corporations for annual skybox leases in a major metropolitan market like

Chicago cushioned Reinsdorf and Wirtz against potential downturns in regular ticket sales. John Glennon, a managing director at Lehman Brothers who helped structure the private financing deal for the United Center, summed this up in 1991when he told

Financial World, “the big advantage of having a good skybox market is that attendance

62 The five other arenas which debuted in these years were in Charlotte (1988, 12 skyboxes), Miami (1988, 18 skyboxes), Milwaukee (1988, 68 skyboxes), Sacramento (1988, 30 skyboxes), and Orlando (1988, 26 skyboxes). The eleven arenas that opened between 1990 and 1996 were in Minneapolis (1990, 67 skyboxes), Salt Lake City (1991, 56 luxury Boxes), Phoenix (1992, 88 Skyboxes), San Antonio (1993, 32 skyboxes), Cleveland (1994, 92 skyboxes), Chicago (1994, 216 skyboxes), Vancouver (1995, 88 skyboxes), Seattle (1995, 58 skyboxes), Portland (1995, 70 skyboxes), Boston (1995, 104 skyboxes), and Philadelphia (1996, 126 skyboxes). Data obtained from John Helyar, “Game? What Game? Arenas Emphasize Ambiance and Amenities to Entice Fans,” Wall Street Journal, March 20, 1991, ProQuest; “How Suite it Is,” Team Marketing Report, 12, no. 6 (March 2000), 5-6; Judith Grant Long, Public/Private Partnerships for Major League Sports Facilities (New York, NY: Routledge, 2013), 22-25.

63 Anthony Baldo, “Secrets of the Front Office,” Financial World, July 9, 1991, 28-39.

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can really drop off and it won’t hurt your revenue stream because you have people on an annual lease.”64

Table 2.2. Venue-Related Revenues for the Chicago Bulls and Chicago Blackhawks, 1992-96.a Pre-United Center United Center 1992-93 Season 1993-94 Season 1994-95 Season 1995-96 Season Bulls 2.71 2.65 8.55 12.20

Blackhawks 8.69 7.20 23.06 24.50

Total: 11.40 9.85 31.61 36.70 Source: Fort, “NBA Income and Expenses,” (2013). Data based on estimates from Team Marketing Report. a “Venue-related revenue” includes luxury suite rentals, concessions, parking, and in-stadium advertising. All values in millions of 1996 US dollars.

At least in terms of the skyboxes and club seating, there was little doubt that the

United Center was, as the Sun-Times worded it shortly before it opened, “a pleasure dome designed for wheeler-dealers first and basketball fans second.” A promotional pamphlet advertising the new club seats made it clear that one of the primary purposes of these luxury options was to provide local businesses with an innovative way to entertain current or perspective corporate clients. “Luxurious club seating—whether to get an edge on your competition, boost sales, close deals, show appreciation or to entertain family and friends—is the ultimate way to enjoy events in style and with total convenience and comfort,” it told potential buyers.65 A long list of “high-rollers” immediately availed themselves of the new premium seating options. Major corporations with offices in

64 Anthony Baldo, “Edifice Complex,” Financial World, November 26, 1991, Factiva. Of course, it also didn’t hurt that, when the United Center opened, skybox sales were not included in the pool of NBA revenues from which players were guaranteed a specific percentage based on their collective bargaining agreement (CBA). Dennis Zimmerman, “Subsidizing Stadiums: Who Benefits, Who Pays?,” in Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums, ed. Roger Noll and Andrew Zimbalist, 119-145 (Washington, D.C.: Brookings Institute Press, 1997), 141-42; Robert Baade, “What Explains the Stadium Construction Boom?,” Real Estate Issues 21, no. 3 (1996): 5-11; Michael Ozanian, “The $11 Billion Pastime,” Financial World, May 10, 1994.

65 Hewitt, “Bulls’ Center of Controversy.” 123

Chicago such as Waste Management, Budget Rent-a-Car, and LaSalle National Bank dug

“deep into their pockets to secure skyboxes” during the United Center’s inaugural season.

In November of that year, Barry Brown, president of Chicago Harley-Davidson, described his experience in his $100,000+ first-tier suite to Crain’s. “I just about live there,” Brown explained. “It’s a totally different perspective. You don’t have to deal with smoke and people bumping into you. There’s a separate hallway and entrance and exits.”66

The local press rarely tired of adding to the list of high-profile names who

frequented the United Center, whether they schmoozed in the luxury suites, sat in the

club section, or literally rubbed elbows with the players and coaches while stationed in

courtside seats, which sold for well above $300/game by the time the United Center

opened (see Fig 2.4). Private equity manager Marc Heisley, Hyatt Hotels magnate Robert

Pritzker, and Illinois Governor Jim Edgar were just a few of the movers and shakers who

could be spotted regularly at “the House that Jordan Built.” Not surprisingly, local

lobbyists began to use the tickets as in-kind campaign contributions. In 1996 alone,

campaign donors transferred a total of $12,000 in the form of Bulls tickets to 46 different

state officials.67 Local observers were probably not exaggerating when they reported

66 Robert Markus, “High Price of Being a Fan in Ticket Game,” Chicago Tribune, April 13, 1994, ProQuest; Joanne Cleaver, “Hot Boxes,” Crain’s Chicago Business, November 12, 1994, ProQuest. Michael Danielson cites estimates from the mid-1990s indicating that “the corporate community buys 90 percent of all luxury seating,” and that “in 1985, business and corporate sales accounted for approximately half of the gate revenues in baseball, basketball, and hockey, and the proportion has steadily risen since.” Michael Danielson, Home Team: Professional Sports and the American Metropolis (Princeton, NJ: Princeton University Press, 1997), 64, 330.

67 Dennis Conrad and Ray Long, “Lobbyists find Bulls Games Are Just the Ticket for Lawmakers,” State Journal Register, May 19, 1997, ProQuest; Kevin Knapp, “Bagging Grizzlies,” Crain’s Chicago Business, May 1, 2000, ProQuest; Shia Kapos, “Bulls Eye View: United Center Is Playground for City’s Power Brokers,” Crain’s Chicago Business, January 9, 2012, ProQuest. 124

seeing “stretch limos pulled up to the [arena’s] south entrance” or fans “dressed as if

headed to a charity ball rather than a sporting event.”68

Many longtime fans worried about what these trends meant for the quality of their

experience at Bulls games, or for their ability to get into games at all. In 1994, Mike

Ropa, a 29-year-old “computer operator” and Bulls season-ticket-holder, complained to

the Sun-Times after learning of the team’s “relocation campaign,” which apparently

involved moving some season-ticket holders further away from the action or to less ideal

sightlines in order to make room for premium seating. “I think it stinks,” Ropa told the

paper. “Pretty soon, nobody’s going to be going there to cheer the team, just to close

deals,” he added. “They’re catering to the wealthy businessman.”69 Two years later, C.

Wesley Johnson, a sophomore at Percy Julian High School on the South Side of Chicago, wrote to the Sun-Times in response to a call for inquiries that the paper would put to Bulls chairman Jerry Reinsdorf in a special question and answer session. Johnson posed the following question to Reinsdorf:

How does a family of five, whose income is under $30,000 a year, purchase or get tickets to see the Bulls in the regular season? My mother has tried and was either told it’s the hottest ticket in town or the price is so high you need a six-figure salary to afford it. What happens to regular people like my family who are diehard Bulls fans but can only settle for watching them on TV?

Reinsdorf responded by saying that the Bulls gave away 250 tickets for every game to local schools, and referred Johnson to the team’s community relations department.70

68 Blair Kamin, “Don’t Take Me Out to the Mall Game,” Chicago Tribune, February 5, 1995, ProQuest; Ron Grossman and Flynn McRoberts, “Near West Side Rebounds,” Chicago Tribune, June 7, 1998, ProQuest.

69 Brian Hewitt, “Bulls’ Center of Controversy.”

70 Bob Herguth, “Reinsdorf Talks About His Teams,” Chicago Sun-Times, May 19, 1996, NewsBank. 125

Even if Reinsdorf and the Bulls kept their word on the 250 free seats, this was a

little over one percent of the arena’s 21,500-seat capacity.71 And even if the team

continued to offer nosebleed seats for less than $20 during its first few years of operation,

the United Center was clearly not intended to expand opportunities for live viewership by

regular fans. As the Tribune noted in 1994, despite boasting four times as much area as

the old Chicago stadium, the increase in non-skybox seating was modest, up only three

thousand. Skyboxes “account for most of the increased seating,” the paper explained.72

Moreover, season ticket holders now owned the vast majority of the seats. By 1999, the

season ticket base stood at 16,000, a full three-quarters of the arena’s capacity.73 Only a

few thousand seats remained for those unable to afford packages for the entire season.

Given the soaring demand for seats driven by the wild success of Jordan’s

teams—especially after his return to the Bulls in 1995 following a nearly 2-year hiatus—

the prices for whatever remained often spiraled out of control as a result of mark-ups by

scalpers and ticket brokers. As Figure 2.5 shows, the face-value of the average Bulls

ticket continued to rise during the second half of the 1990s (these averages do not include

rents for skyboxes), and was consistently among the five most expensive in the NBA.

This, however, doesn’t capture the fact that, at the end of the 1994-95 season, some

Chicagoans intent on witnessing Jordan’s return from retirement shelled out $1,000 to

brokers to get their hands on tickets with a face value of $350. As the Jordan hype

escalated, scalpers reported getting as much as $1,500 for tickets originally sold for

71 Frederick H. Low, “Tickets Soar for United Center,” Chicago Sun-Times, June 29, 1994, NewsBank.

72 John Handley, “Arena Financing No Pie-In-the-Skybox-Deal,” Chicago Tribune, July 24, 1994, ProQuest. It appears that the paper was referring to gross square footage, rather than the area of the foundation.

73 Jeff Borden, “Bulls Play Defense at the Ticket Office,” Crain’s Chicago Business, May 17, 1999, ProQuest. 126

$75!74 The mark-ups reached even more ridiculous proportions when it became clear in

1998 that Jordan was probably in the midst of his last season with the team. According to

the Sun-Times, brokers were nabbing $3,000 for a ticket a few rows back from courtside

during that year’s NBA finals at the United Center. Courtside seats allegedly sold for

$10,000, and the handful of standing-room-only tickets went for $350.75

Admittedly, these outlandish prices were a function of the fervor surrounding the special circumstances of Jordan’s return and departure, but this is not to say that families on relatively tight budgets otherwise had an easier time getting into the United Center.

During the late 1990s, Team Marketing Report assembled a statistic called the “Frugal

Fan Index,” which summed the cost for each NBA facility of four of the least expensive tickets, four small sodas, four hot dogs, and a parking pass. Not surprisingly, each of the four years for which Team Marketing Report computed the index, the Bulls came in well above the league average, and by the late nineties a penny-pinching family at a Bulls game was on the hook for more than $100 (see Table 2.3). To put this into broader perspective, in 1996 the Bureau of Labor Statistics reported that, for households in the third quintile of annual income (i.e. 40% of households brought in more income, 40% brought in less), the average annual expenditures on fees and admissions for entertainment came to $312, or less than the amount necessary to cover three of the cheapest outings to a Bulls game for a family of four. Average annual expenditures

74 Comelia Grumman, “Brokers’ Prices Are Jumping Higher than a Certain Bull,” Chicago Tribune, March 19, 1995, ProQuest; Marla Donato and Michael Martinez, “Demand for No. 45 Sends Sales Skyrocketing,” Chicago Tribune, March 25, 1995, ProQuest.

75 Michael Gillis, “Bulls Tickets Shoot Up to $9,000 Each,” Chicago Sun-Times, June 10, 1998, Highbeam Research; Laura Janota, “Caught Up in Ticket Madness?,” Daily Herald, June 12, 1998, ProQuest. 127

among households in the lowest 20% stood at about $140, the equivalent of one game for

the whole year, plus a few extra hotdogs.76

Table 2.3. Team Marketing Report “Frugal Fan Index,” 1995/96-1998/99.a Season Bulls NBA Avg. 1995-96 $90.00 $64.60 1996-97 $111.00 $72.05 1997-98 $113.00 $76.63 1998-99 $112.00 $66.87 Source: “Frugal Fan Index,” Team Marketing Report (1995, 1996, 1997, 1998). a “Frugal fan index” includes cost of four of the cheapest tickets, four hot dogs, and four small soft drinks, and one parking pass.

Things had gotten so expensive by the late 1990s that various “alternative”

spectatorship experiences emerged for those who couldn’t afford a game at the United

Center. As the previous section documents, the most popular stand-in for going to actual

games was attending the free championship rallies at Grant Park, but other substitutes

existed. For example, in 1997, Bulls ownership decided to broadcast Game 4 of the NBA

finals—Chicago was playing away at Utah—on the United Center jumbotron and charge

fans $10 dollars for admission. They “pitched the event for those who don’t usually come

to Bulls games,” and the pitch seems to have worked. According to the Sun-Times, many among the thousands who showed up “were making their first pilgrimage to the house that Michael built” in order to take advantage of the “wallet friendly” price. Thirteen-

year-old fan Bob Buckstaff, who came from the middle-class suburb of Mount Prospect to watch the broadcast, no doubt would have preferred an actual, in-the-flesh game, but as he told the paper, “the chances of us going to a real Bulls game are pretty slim.”77

76 Bureau of Labor Statistics, “Quintiles of Income Before Taxes,” Consumer Expenditure Tables, accessed August 20, 2013, http://www.bls.gov/cex/csxstnd.htm.

77 Dan Rozek, “Fans United in Support,” Chicago Sun-Times, June 9, 1997, NewsBank. 128

By the end of the century, never had local Bulls fans from such a wide range of

backgrounds—from middle-class suburban families to public housing tenants on

Chicago’s South Side—faced such challenges when it came to seeing their team live.

Accessing the old Chicago Stadium had never been an egalitarian utopia, but the demographic transformation of the in-stadium crowd in the late eighties and early

nineties represented a real, qualitative shift in how the city experienced and consumed

professional basketball; the shape of one’s fandom depended increasingly on her ability

to pay for certain types of access to the team. In the end, the unity allegedly fostered by

the team’s success butted up against tangible limits set by the increasing scarcity of

opportunities for regular fans to root on Jordan and the rest of the Bulls inside their home

arena.

The Salary Canard and the Emergence of a New Market of Spectators

If all available evidence points to the increasing prominence of moneyed fans at

Chicago Stadium and the United Center, then what exactly was causing the shift? One

answer that circulated inside and outside of Chicago had to do with escalating player

salaries. In 1988, Bulls beat writer Sam Smith situated the prospect of a new arena for the

team as part of “a transition occurring here that may soon be common for America’s

sports teams, which must continually seek new sources of revenue to meet increasing

[player] salaries.” Smith went on, “one of the favored methods is to build a new arena [in

order to] justify higher ticket prices.”78 For Smith, a direct line went from rising player

costs to the increasing premiums charged for watching live basketball in cities like

Chicago.

78 Sam Smith, “Bulls Notes,” Chicago Tribune, December 8, 1988, ProQuest. 129

Smith was far from alone in this diagnosis. One of Smith’s colleagues at the

Tribune mused in 1990, “with all salary costs…on the rise, it’s the paying customer who may feel the crunch.” 79 Another gave the same thesis a slightly different spin, insisting

that “with dramatically escalating salaries for professional athletes, skybox rentals allow

team officials to keep ticket costs from soaring proportionally for patrons in less

privileged seats.”80 National sports marketing trade publications echoed this latter

iteration of the argument. According to the July 1991 issue of Athletic Business, “the

problem in hockey and particularly in basketball is the salaries have gotten unbelievable.

In order to deal with that, they need to have premium areas that cost a whole lot of money

so they can always have a ticket that the average guy can buy.”81

The idea that higher salaries were to blame for skyrocketing costs of access

continued to surface in local papers throughout the nineties. In 1994, a Tribune piece

pointed to rising player costs as the “most obvious” explanation for ticket price hikes, and

the same year longtime Sun-Times columnist Fran Spielman wrote that the United Center

provided Reinsdorf and Wirtz with “the financial wherewithal to keep pace with

skyrocketing player salaries into the 21st Century.”82 Reinsdorf was more than happy to

do his part in perpetuating Spielman’s logic that responsibility lay with the players. In the

midst of the 1998 NBA lockout, Reinsdorf responded to press queries by insisting that

“in the long run I think our fans gain, because if we can control our [player] costs, we can

79 Brian Schmitz, “$alaries $piral to Unthinkable Heights,” Chicago Tribune, Jan 19, 1990, ProQuest.

80 Bruce Buursma, “A Change in Corporate Playing Field,” Chicago Tribune, September 16, 1990, ProQuest.

81 Andrew Cohen, “Back to the Future,” Athletic Business, July 1991, 31-37, Amateur Athletic Foundation Library.

82 Robert Markus, “High Price of Being a Fan in Chicago Ticket Game,” April 13, 1994, ProQuest; Fran Spielman, “The Puck Stops Here,” Chicago Sun-Times, August 28, 1994, NewsBank. 130

control our ticket prices.” In 2000, as prices remained high despite Reinsdorf’s optimism, the Tribune asserted, “as salaries soar, so does the cost of watching games.”83

Despite widespread acceptance of this theory within the media, it provided—at best—a partial explanation of the rising costs of attendance and the proliferation of luxury facilities like the United Center. Were players’ salaries in the NBA increasing?

Absolutely, and at a very fast rate during the late eighties and nineties (see Figure 2.8).

However, team and league revenues were skyrocketing concurrently, largely as a result of ballooning fees paid by network and cable television companies to secure exclusive rights to broadcast games.84 For the 1985-86 season, national TV revenues for the NBA—the sum of network and cable payments—came to $25 million. Ten years later, the amount had jumped to $219 million.85 In short, rising salaries were not part of some zero-sum game in which team owners like Reinsdorf automatically experienced reduced profit

83 Jim Allen, “Reinsdorf: In Long Run, Fans Will Gain From Lockout,” Arlington Daily Herald, November 11, 1998, ProQuest; Paul Sullivan, “No End In Sight as Athletes’ Salaries Skyrocket,” Chicago Tribune, January 1, 2000, ProQuest. To be clear, this logic was not an invention of the 1980s. Local press and team owners in Chicago had started placing the blame for ticket price hikes on players during the early 1970s. For examples, see David Condon, “If I sold the A’s…I Would Like to Buy Bears: Finley,” Chicago Tribune, February 9, 1974, ProQuest; “Bulls Boost Ticket Prices,” Chicago Tribune, May 7, 1981, ProQuest.

84 Once leagues like the NBA eliminated competition, the steep ascent of TV revenues was aided by the Sports Broadcasting Act of 1961, which authorized leagues to negotiate national rights contracts on behalf of all member teams. In other words, it legalized monopolistic practices in the sale of TV rights. See David Anderson, “The Sports Broadcasting Act: Calling It What It Is—Special Interest Legislation,” Hastings Communication and Entertainment Law Journal 17 (1995): 945-958.

85 These are nominal values obtained from “NBA TV Revenue,” Rodney Fort’s Sports Business Data, updated February 24, 2013, accessed August 20, 2013, https://umich.app.box.com/s/41707f0b2619c0107b8b/1/320023253. Cross-referenced with “NBA TV Contracts,” InsideHoops.com, n.d., accessed August 20, 2013, http://www.insidehoops.com/nba-tv- contracts.shtml. 131

margins when they paid their players more. Instead, they reflected efforts by players to hold on to a consistent percentage of overall revenue.86

Staudohar (1996) Staudohar (1998) Ford (2006)

5.0 4.5 4.0

3.5 3.0 2.5 2.0 1.5 2002 Dollars (millions) 1.0 0.5 0.0

Season

Figure 2.8. Average Player Salaries, National Basketball Association, 1979/80-2001/02. Sources: Staudohar (1996), Staudohar (1998), Ford (2006); each marker corresponds to separate source.

During the early 1990s, NBA ticket prices rose and many teams planned/constructed new luxury arenas in spite of the fact that real growth in absolute revenues dwarfed increases in players’ salaries (see Figure 2.9).87 Based on estimates

86 For more on the relationship between TV money and players’ salaries, see James Quirk and Rodney Fort, Hardball: The Abuse of Power In Pro Team Sports (Princeton, NJ: Princeton University Press, 1999), esp. 29-30.

87 Teams rarely if ever reveal their internal balance sheets and the NBA has accused the estimates from Financial World, and later Forbes, of overstating revenues and profits. However, the New York Times’ Nate Silver reports that leaked financial information from the New Orleans Hornets showed that the estimates “closely match” the actual figures. See Nate Silver, “Calling Foul on N.B.A.’s Claims of Financial Distress,” FiveThirtyEight (New York Times), July 5, 2011, http://fivethirtyeight.blogs.nytimes.com/2011/07/05/calling-foul-on-n-b-a-s-claims-of-financial- distress/?_r=0. 132

compiled by Financial World, between the 1990-91 and 1995-96 seasons, total NBA team revenues went from $843 million to $1.9 billion, while total player costs rose from

$331 million to $780 million (all in nominal dollars). Over the same period, total real operating income for all teams (i.e. profit before taxes and debt service) jumped approximately eighty percent (from $207 million to $373 in 2002 dollars). As Figure 2.10 demonstrates, average operating margins—a rough measure of profitability and cost control calculated by dividing operating income by total revenues—hovered around the more-than-respectable level of 20% for this entire period.88 All of this is to say that: 1) increased player salaries did not necessarily translate into reduced profits or profitability, and 2) the increase in NBA ticket prices even during a period of stable profits and profitability suggests strongly that teams were willing to raise the cost of attending games whether or not they were losing ground as a result of increased player costs.

88 “NBA Income and Expenses,” Rodney Fort’s Sports Business Data, updated March 23, 2013, accessed August 20, 2013, https://umich.app.box.com/s/41707f0b2619c0107b8b/1/320022939. To put this level of operating margin into perspective, Nike—a very profitable company—currently posts operating margins in the low teens. “Key Statistics: Nike Inc.,” Yahoo Finance, accessed August 20, 2013, http://finance.yahoo.com/q/ks?s=NKE+Key+Statistic. Conceptually, operating margin tells us the percentage of each dollar a company earns that is left over after operating costs are deducted, and more generally is an indicator of how well a firm controls costs. When comparing firms, operating income (and margins) are a better metric than net income because the former deals with revenue prior to taxes and debt service. Since debt service and tax liabilities can vary widely from firm to firm depending on the year in question, comparing net income (or profit margins based on net income) may not be useful in gauging relative profitability. Thanks to Aaron Brenner at the United Food and Commercial Workers (UFCW) union for clarifying these points during his presentation on “Financial Analysis for Union Researchers” during the 2013 Strategic Corporate Research Summer School at Cornell University. For more on operating income versus net income, see Bob Vause, Guide to Analysing Companies (New York, NY: Bloomberg Press, 2009), esp. 96. 133

NBA Total Team Revenue NBA Total Team Operating Income NBA Total Player Costs 3,000

2,500

2,000

1,500

1,000

2002 Dollars (millions) 500

0

-500 1990-91 1992-93 1994-95 1996-97 1998-99 2000-01 Season

Figure 2.9. Aggregated Core Financial Data, National Basketball Association Franchises, 1990/91- 2000/01.a Sources: Fort, “NBA Income and Expenses” (2013). Based on data from Financial World (through 1995-96 season) and Forbes (post-1995-96 season). a “Operating income” is the difference between total revenue and operating expenses. “Player costs” include salaries, deferred payments, bonuses, insurance, and workers’ compensation. Gaps in the series represent missing data (i.e. estimates not produced for the variable in question for that season).

134

Bulls Rest of NBA

50.0%

40.0%

30.0%

20.0%

10.0% Operating Margin Margin Operating 0.0%

-10.0%

-20.0% 1990-91 1992-93 1994-95 1996-97 1998-99 2000-01 Season

Figure 2.10. Operating margins of the Chicago Bulls and rest of NBA (average), 1990/91- 2000/01.a Sources: Author’s calculations from data in Fort, “NBA Income and Expenses” (2013). Based on data from Financial World (through 1995-96 season) and Forbes (post-1995-96 season). a Operating margin tells us the percentage of each dollar a company earns left over after operating costs are deducted, and more generally is an indicator of how well a firm controls costs (see note 244). Gaps in the series represent missing data (i.e. estimates not produced for the variable in question for that season).

The case of the Bulls confirms both of these points. Between the 1990-91 and

1995-96 seasons, the team’s total estimated revenue leaped from $41.8 million to $112

million, while estimated player costs jumped from $10.8 million to $25.5 million (all in

nominal dollars, see Figure 2.11). In real terms, this translated into a more than 70%

jump in estimated operating income, and operating margins ranging anywhere from thirty

to forty percent—numbers that would have made just about any CEO dizzy with

135

excitement.89 Yes, the Bulls payroll was rising during this period, but the data simply does not support the argument that Reinsdorf and company raised ticket prices because player salaries were eating away at profitability. As long as demand persisted, the Bulls would charge more for seats (and construct hundreds skyboxes in the meantime) no matter how low player salaries dropped.

Total Revenue Player Costs Operating Income

140.0

120.0

100.0

80.0

60.0

2002 Dollars (millions) 40.0

20.0

0.0 1990-91 1992-93 1994-95 1996-97 1998-99 2000-01 Season

Figure 2.11. Chicago Bulls Core Financial Data, 1990/91-2000/01.a Sources: Fort, “NBA Income and Expenses” (2013). Based on data from Financial World (through 1995-96 season) and Forbes (post-1995-96 season). a “Operating income” is the difference between total revenue and operating expenses. “Player costs” include salaries, deferred payments, bonuses, insurance, and workers’ compensation. Gaps in the series represent missing data (i.e. estimates not produced for the variable in question for that season).

Sports economists James Quirk and Rodney Fort have provided the most consistent and lucid explication of the argument that in all major league spectator sports,

89 Rodney Fort, “NBA Income and Expenses,” Rodney Fort’s Sports Business Data, updated March 23, 2013, accessed August 20, 2013, https://umich.app.box.com/s/41707f0b2619c0107b8b/1/320022939. 136

ticket prices are not a function of player salaries, but rather a function of demand for

tickets. In fact, as they point out, the chain of causation is precisely the opposite of what most assume. In their words:

Fans tend to think that the high salaries drive up the prices of seats at games, and that if there were some way to put a lid on salaries, ticket prices would fall. This is simply a misunderstanding of the cause-and- effect chain at work in sports. The reason that salaries are high is because the demand for sports is high, as reflected in the prices that people are willing to pay for the rights to telecast sports games. The higher ticket prices and high TV-rights prices increase the value of star players to teams, the amounts they add to a team’s revenue, which then gets reflected in the high salaries paid to those players. Salaries are high because ticket prices are high, not the other way around.90

In Chicago, player costs became a convenient scapegoat for both team owners and the media. The flawed logic absolved Reinsdorf of responsibility for pricing out more and more fans in the name of sustaining and expanding growth, and provided journalists with a seemingly intuitive and easily digestible explanation for frustrated readers.

It is true that player salaries spiked in the mid-1990s as many teams—the Bulls chief among them—broke the team salary cap to re-sign star players like Michal Jordan.

By the 1997-98 NBA season, player costs had risen to 57 percent of total league revenue, significantly above the 51.8 percent guaranteed by the collective bargaining agreement.

Profits and profit margins suffered accordingly (see Figures 2.9, 2.10, and 2.11), and the owners successfully leveraged a protracted lockout during the 1998-99 season to introduce new salary constraints (most notably an individual player salary cap tiered by

90 Quirk and Fort, Hardball, 89. On the relationship between salaries and ticket prices, also see James Quirk and Rodney Fort, Pay Dirt: The Business of Professional Team Sports (Princeton, NJ: Princeton University Press, 1992), 219-223; Zenon Zygmont, “Why Professional Athletes Make So Much Money,” in Sport and Public Policy, ed. Charles Santo and Gerard Mildner, 33-48 (Champaign, IL: Human Kinetics, 2010). 137

years of service).91 None of this, however, altered the fact that the cost of attending games began its steep ascent more than a decade before, and continued even through protracted periods of effective cost control by NBA teams. Throughout the 1990s, fans paid more and new, skybox-laden arenas popped up regardless of the intricacies of teams’ balance sheets.92

Perhaps the best evidence of the absence of a tight relationship between player salaries and the cost of attending Bulls games emerged after team management disbanded the Jordan-led dynasty in 1998. Over the course of the next six seasons, the Bulls not only never made the playoffs, but finished with the worst record in the Eastern

Conference five times.93 Team management dumped payroll once Jordan left, but the fervor created around the team by Jordan carried over even after the Bulls fell into the league’s doldrums. In August of 1999, the Tribune reported that “the six-time world champions are still riding a hot streak in attendance with 567 consecutive sell-outs.”94

The high demand for tickets continued, and prices remained well above the league average in the years following Jordan’s departure (see Figure 2.5) despite the fact that the

91 Paul D. Staudohar, “Labor Relations in Basketball: The Lockout of 1998-99,” Monthly Labor Review (April 1999): 4, 8.

92 The outcome of the 1998-99 lockout placed relatively effective constraints on salary growth. In real terms, total player expenses jumped 322% ($1.4 billion in 2010 dollars) between 1989-90 and 1999-2000, but only 24 % ($431 million in 2010 dollars) between 1999-2000 and 2009-10. Despite this fact, and despite the fact that revenue increases have continued to outpace salary growth, operating margins for the NBA never returned to their 1990 levels. As Nate Silver has pointed out, despite the fact that owners continue to blame reduced profitability on player compensation, a more likely answer has to do with big increases in “other costs” reported by the league, including expansion of the NBA’s international and online marketing and development programs. These ancillary capital costs have risen at a much faster rate than both player salaries and revenues, and are a much more likely culprit for reduced profit margins. Of course, these investments may pay off in higher margins for the league and teams down the road. See Silver, “Calling Foul on N.B.A.’s Claims.”

93 “Chicago Bulls Franchise Index,” Basketballreference.com, n.d., accessed August 20, 2013, http://www.basketball-reference.com/teams/CHI/.

94 David Sharos, “Stadium Seats With High Hopes for the Falls Season,” Chicago Tribune, August 23, 1999, ProQuest. 138

Bulls posted one of the lowest payrolls in the NBA! In the three years after Jordan left,

for example, the team’s player expenses sat in the bottom three among all NBA teams.95

That this did not result in a commensurate drop in ticket prices demonstrates that lower player salaries did not necessarily translate into a cheaper United Center experience for fans.

Again, Quirk and Fort offer a succinct and cogent theoretical rationale for why things played out in this way. “If an enforceable lid were imposed on salaries,” they explain, “ticket prices wouldn’t fall, because it wouldn’t be in the interest of owners to cut prices. As reasonable businessmen, they are already presumably charging the ticket prices that maximize their profits.”96 In other words, as long as the demand existed for

highly priced seats and luxury boxes at the United Center after Jordan left the team—and

we know from paid attendance figures that it did—then Reinsdorf had absolutely no

reason to lower the cost barriers to entry into the United Center in order to provide

regular fans with a more affordable experience.97 Accordingly, he did nothing of the sort.

This is not to say that player salaries had no influence on changes in the dynamics

of class and consumption of the Bulls. For example, given that the NBA’s Collective

Bargaining Agreement (CBA) guaranteed players a fixed percentage of league revenues,

ownership had to look to growth and profit maximization strategies other than squeezing

labor costs. It’s plausible that catering to Chicago’s corporate set through premium

95 During these three years, the Bulls’ average ticket price ranked 6th, 8th, and 12th most expensive out of 29 teams. Rodney Fort, “NBA Ticket Prices,” Rodney Fort’s Sports Business Data, based on data from Team Marketing Report, February 27, 2013, accessed August 20, 2013, https://umich.app.box.com/s/41707f0b2619c0107b8b/1/320023271,

96 Quirk and Fort, Hardball, 89.

97 Rodney Fort, “NBA Attendance,” Rodney Fort’s Sports Business Data, updated May 24, 2013, accessed August 20, 2013, https://umich.app.box.com/s/41707f0b2619c0107b8b/1/320022885. 139

seating emerged as a way to ensure that the fixed percentage owed to players did not place a cap on Reinsdorf’s ability to increase the profitability of the franchise over the long term. As Quirk and Fort confirm, “the high level of player salaries does impact the profitability of sports teams, which is a matter of much concern to owners.”98 But again, it bears pointing out that no matter how high player salaries rose during the course of the

1990s, skyboxes could not function as a profit maximization tool without adequate demand.

How did that demand emerge? Over the course of the 1970s and 80s, structural changes in the American economic and demographic landscapes combined with institutional developments in the NBA to produce an environment in which targeting wealthy spectators for attendance at live games made good economic sense. The most obvious component in this mix of factors involved the upward redistribution of wages and income. Beginning in the 1970s, wage gaps between “top wage” earners and

“middle-wage” earners, as well as between middle-wage and “low-wage” earners, began to widen considerably. Despite consistent increases in productivity, low-wage and many middle-wage workers found their earnings squeezed by the replacement of manufacturing positions by service jobs, the disappearance of unions, the relocation of jobs offshore, a drop in the real minimum wage, and protracted periods of high unemployment (especially during the early and mid-1980s). Many top wage earners worked in sectors of the labor market less vulnerable to these changes, and as Figure 2.12 shows, as those in the bottom half of America’s wage ladder experienced a significant fall in hourly wages, those at the high end registered major gains. Between 1973 and 1995, those in the 50th percentile of hourly wage-earners (i.e. half of the population earned more wages/hour, half less), saw

98 Quirk and Fort, Hardball, 92. 140

their real hourly wage drop by four percent, while those in the 95th percentile (i.e. only

five percent earned more), experienced a more than ten percent increase. This growing

inequality was exacerbated by the fact that those at the top also experienced sizeable

growth in non-wage income such as capital gains.99

Of course, this wage squeeze made it more difficult for Americans at and below

the median to take advantage of leisure activities such as attending professional sporting

events, especially as ticket prices escalated steeply in the 1980s. Millions of workers

either found themselves with less disposable income, or with less time for recreation as a

result of working more hours to offset the decline or stagnation of wages.100 Indeed, data

collected by the Bureau of Labor Statistics indicate that, on average, the only pre-tax

household income quintile that exhibited a notable expansion of annual expenditures on

“fees and admissions” for entertainment activities after 1984 was the top 20 percent

(Figure 2.13). Even during the economic boom of the late 1990s—the only period in the

last four decades during which growth in earnings owed more to real increases in wages

than increased working hours—expenditures by the bottom four quintiles remained

flat.101

99 Lawrence Mishel et al., The State of Working America, 12th Edition (Ithaca, NY: Cornell University Press, 2012), 54-56, 173-174.

100 Using data from the Current Population Surveys (CPS) produced by the Census Bureau and Bureau of Labor Statistics, Juliet Schor estimates that between 1969 and 1987, the number of annual paid hours worked by the average American went up by 163. Juliet Schor, The Overworked American: The Unexpected Decline of Leisure (New York, NY: Basic Books, 1992), 29.

101 Mishel et al., The State of Working America, 56. On the correlation between growing income inequality and changes in consumption patterns after 1970, see David Cutler and Lawrence Katz, “Rising Inequality? Changes in the Distribution of Income and Consumption in the 1980s,” National Bureau of Economic Research, Working Paper No. 3964 (January 1992); Dirk Kruger and Fabrizio Pebri, “Does Income Inequality Lead to Consumption Inequality? Evidence and Theory,” Review of Economic Studies 73 (2006): 163-193. While both income and consumption expenditures have become increasingly polarized in recent decades, Kruger and Pebri’s analysis shows that the trend has been less pronounced when it comes 141

95th

80th Percentile 50th

20th

-15 -10 -5 0 5 10 15 Percent Change in Real Hourly Wage

Figure 2.12. Percent Change in Real Hourly Wage by Selected Percentile, 1973-1995. Sources: Adapted from Henwood (2013); based on data compiled by Mishel et al. (2012).

to the latter, and that this probably owes to concurrent trends such as the expansion of individual consumer credit/debt. 142

Highest 20% Fourth 20% Third 20% Second 20% Lowest 20%

2,500

2,000

1,500

1,000

500 Average Annual Expenditures (2011 Dollars) (2011 Expenditures Annual Average 0 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 Year

Figure 2.13. Average Annual Consumer Unit Expenditures on “Entertainment Fees and Admissions” by Pre-tax Income Quintile, 1984-2011.a Sources: U.S. Bureau of Labor Statistics, “Quintiles of Income Before Taxes” (1984-2011). a “Consumer unit” includes all members of a particular household. According to the Bureau of Labor Statistics, “fees and admissions” includes “fees for participant sports; admissions to sporting events, movies, concerts and plays; health, swimming, tennis and country club memberships; fees for other social, recreational, and fraternal organizations; recreational lessons of instruction; rental of movies, and recreation expenses on trips.”

According to economist Robert Frank, growing income inequality not only accounted for the widening gap between the expenditures of top earners and the rest of

American society, but also for the expanded production and consumption of luxury goods and services favored by those on the winning end of this transformation. He cites several telling examples of the growth in extravagant purchases in the U.S. during the eighties and nineties. In 1997, the number of luxury cars sold rose by 6.5 percent despite a 3 percent drop off in the total number of automotive sales (particularly striking was the 79 percent increase in the number of Porsches purchased). The markets for second-

143

homeownership, yachts, and cosmetic surgery all experienced similar booms. During the eighties and nineties, skyboxes at arenas like the United Center signaled that this “luxury fever” had penetrated the sports spectatorship market.102

A handful of experts have identified these bigger trends as a crucial driver of the

increasing exclusivity of live sports spectatorship. Economist Robert Baade, for example,

noted in the mid-1990s that “the market for spectator sports has become more segmented as the distribution of income in the United States becomes more skewed,” and that “the demand for luxury loges and stadium clubs reflects growing income inequality.”103 But

the fans attending games at places like the United Center did not skew increasingly richer

during this period simply because working- and middle-class Americans had relatively

fewer resources. In order to adapt to and capitalize on these shifts, teams like the Bulls

very deliberately cultivated a new live spectatorship market populated by wealthy fans.

The late seventies and early eighties were dark ages for the NBA. Attendance had

plateaued, labor uncertainty prevailed in the wake of the players’ success in securing

free-agency, and Americans perceived the league as drug-infested.104 As evidence of how bad things were, in 1980 network TV broadcast the thrilling sixth game of the NBA finals between the Lakers and 76ers on a three-to-six hour tape delay. According to the recollections of one league official, during the 1982-1983 season NBA leadership

102 Robert Frank, Luxury Fever: Why Money Fails to Satisfy in an Era of Excess (New York, NY: The Free Press, 1999), 19, 26.

103 Baade, “What Explains the Stadium Construction Boom,” n.p (unpaginated e-copy).

104 Quirk and Fort, Pay Dirt, 11, 204.

144

“seriously” discussed reducing the size of the league by four or five teams.105 This downward trajectory reversed dramatically when David Stern’s takeover as commissioner converged with the emergence of fan-friendly stars like Magic Johnson and Larry Bird. In addition to implementing a strict anti-drug policy and leading the effort to institute the first league-wide salary cap, Stern assembled a veritable army of marketing experts that focused on parlaying the broad allure of stars like Johnson and

Bird—and later Michael Jordan—into an expanded fan base.106 The restructuring paid off, as the NBA became the only major league to register increased TV ratings during the early and mid-1980s.107 According to estimates by Nielsen Research, the average per- game audience for the NBA finals skyrocketed from 11.4 million in 1985 to 24.1 million in 1987.108

This increased exposure was part of a much larger transformation in the business of American sport; in fact, the NBA’s success as a mass-mediated sport came relatively

105 Russell Granik (NBA Executive Vice President), “NBA Overcomes Financial Woes, Meets Drug Problem, TV Contracts, Expansion Head on,” Sportsbil, January 1990, Vol. 11, n.p., Amateur Athletic Foundation Library.

106 Helitzer, Dream Job, 32-33; David Andrews, Sport-Commerce-Culture: Essays on Sport in Late Capitalist America (New York, NY: Peter Land, 2008), 16. Stern replaced Larry O’Brien, who before serving as NBA commissioner from 1975 to 1984, worked as a democratic strategist for John F. Kennedy and the Postmaster General During the Lyndon B. Johnson administration. Albin Krebs, “Lawrence O’Brien, Democrat, Dies at 73,” New York Times, September 29, 1990, http://www.nytimes.com/1990/09/29/obituaries/lawrence-o-brien-democrat-dies-at- 73.html?pagewanted=all&src=pm.

107 Bill Gloede and C.L. Smith Muniz, “NBA Goes Global,” Sports Inc.: The Sports Business Weekly, November 16, 1987, 29, Amateur Athletic Foundation Library; Merrill Goozner, “Michael Jordan & Co. Fuel Chicago’s Bull Market,” Chicago Tribune, May 1 , 1988, Proquest.

108 Bill Gorman, “NBA Finals TV Ratings, 1974-2008,” TV By the Numbers, May 22, 2009, accessed August 20, 2013, http://tvbythenumbers.zap2it.com/2009/05/22/nba-finals-tv-ratings-1974-2008/19324/. As Quirk and Fort point out, one of the underlying demographic conditions facilitating this expansion of viewership was the emergence of the baby-boomer generation as a “targeted audience for TV programming…So the underlying reason for the huge increases in TV income in sports over the past twenty years is the emergence of a large group of individuals who are avid TV watchers, who have money to spend…That audience in turn attracts big bucks in the form of advertising dollars.” Quirk and Fort, Hardball, 37-38. 145

late. The National Football League (NFL), in particular, experienced jaw-dropping growth in previous decades largely as a result of the skillful marketing of Monday Night

Football. Quirk and Fort report that the NFL’s “media income” (i.e. tv, radio, etc.) went from $3 million in 1960 (the rival American Football league earned $1.6 million in media income that year) to $167 million in 1980, and up to $948 million in 1990.109 Data from

Nielsen research shows that the number of people watching the Super Bowl went from

24.4 million in 1967 to 92.6 million in 1986.110 The growing mania around televised

sport laid the groundwork for the successful efforts by team owners like Reinsdorf to

transform live spectatorship into an experience readily demanded by the wealthy and

well-connected. As television brought a rebranded NBA into households across the

demographic spectrum, it made perfect sense for teams to create live viewing experiences

that targeted those with the most spending power. As the August 1984 edition of Athletic

Business told its readers, “it’s important to think of your facility as an opportunity for

revenue production, just waiting to be marketed to the right group or individual. Yes, it

requires some legwork and communication with potential users, but the results can be

extremely beneficial.”111

The Bulls did not skimp on the required legwork. By 1990, the team had

expanded its internal marketing division to twenty-two full-time employees.112 In 1991,

Steve Schanwald, the teams’ Vice President for Marketing, told Team Marketing Report

109 Figures in nominal dollars. Quirk and Fort, Hardball, 30.

110 Bill Gorman, “Will ‘Super Bowl’ TV Viewership Set Another Record?,” TV By the Numbers, January 28, 2011, http://tvbythenumbers.zap2it.com/2011/01/28/will-super-bowl-tv-viewership-set-another-record- poll-ratings-history/80597/.

111 “Renting Your Facility Can Maximize Space Use and Generate Revenues,” Athletic Business 8, no. 8, August 1984, 86, Amateur Athletic Foundation Library.

112 Carla Nielsen, “Bull Market in Show-Biz,” Chicago Sun-Times, October 31, 1990, NewsBank. 146

that one of the department’s main goals involved drumming up demand—and, by

extension, prices—by actively advertising the scarcity of tickets. He explained:

It’s important to convey in the minds of current and potential season ticket holders what a precious commodity a Bulls season ticket is. Our sellout streak is publicized extensively. A waiting list for Bulls season tickets is promoted aggressively. This not only gives us a list of people to whom we can sell tickets when and if they become available, but it reinforces in the minds of current season ticket holders the precious commodity they possess.113

Indeed, the local and national press carried stories on season ticket waiting lists

throughout the nineties. In 1991 the Sun-Times reported a list of nearly 6,000 names, in

1994 the paper noted that it had ballooned to 12,000, and in 1998 Sports Illustrated

informed readers that 23,000 people were officially waiting for a shot at season tickets.114

Similar stories also appeared in reference to single-game tickets. The Sun-Times

informed readers in June 1991 that Ticketron received more than 1.7 million phone calls

for tickets to the NBA finals between the Bulls and Lakers.115 In 1997, a series of popular

local television spots on WGN and Sportschannel put a comic spin on the perceived value

of Bulls tickets. One depicted traders at the Chicago Mercantile Exchange “frantically

waving bids” at a man holding two Bulls tickets and “chuckling about ‘a Bulls market.’ ”

Another showed negotiations between two sets of businessmen—one American, one

Asian. The Asian group agrees to a deal after receiving three Bulls tickets from their

counterparts. And yet another portrayed a terrorist fending off a SWAT team by holding

113 Steve Schanwald, “Beyond Michael: The Bulls Use Today’s Marketing Strategies to Generate Long- Term Interest in the Team,” Team Marketing Report 4, no. 2, November 1991, 8, Amateur Athletic Foundation Library.

114 Ray Sons, “New Stadium, Old Memories,” Chicago Sun-Times, May 14, 1991, NewsBank; Hewitt, “Bulls’ Center of Controversy”; Rick Relly, “Last Call?,” Sports Illustrated, May 11, 1998, accessed August 20, 2013, http://sportsillustrated.cnn.com/vault/article/magazine/MAG1012804/index.htm.

115 Philip Francine, “1.7 Million Dial, But Few Ring Up 6,000 Bulls Tickets,” Chicago Sun-Times, June 4, 1991, NewsBank. 147

a lighter to two Bulls tickets.116 As the previous section makes clear, the local papers also

raised awareness among Chicagoans about the new skyboxes at the United Center, and in

the early nineties the Bulls established a separate “Suite Department” to service current

and prospective leaseholders.117

This marketing barrage helped ensure a voracious appetite for Bulls games among

fans who could afford them on a regular basis. It’s no wonder that in 2005, Crain’s

Chicago Business compared scoring courtside seats at a Bulls game to choice seating at

the Chicago Symphony Orchestra. According to the paper, the front rows at both venues

“are home to VIPs, deep-pocketed donors and groupies. Landing these coveted spots

usually requires some combination of perseverance, luck, timing and a long commitment

to an organization, in addition to a sizeable cash investment.”118 Courtside seats were an

extreme example, but as this chapter shows, by the end of the century any seat in the

United Center required a significant investment, especially by the standards of low- or

middle-income families with plans to visit the concession lines.

Of course, for Reinsdorf and the rest of Bulls management, that these families found it more and more difficult to gain access to see the Bulls live was not a problem, since having a large, dedicated TV audience helped guarantee robust returns on selling local broadcasting rights. In fact, the Tribune estimated in 1997 that revenues from local

116 Michael Hirsley, “Yes, Even the Lordly Bulls Must Do A Little Marketing,” Chicago Tribune, May 9, 1997, ProQuest.

117 “Chicago Bulls Make Moves to Get Personal with Season Ticket Buyers,” Team Marketing Report, 5, no. 2, November 1992, 2, Amateur Athletic Foundation Library.

118 Mark Scheffer, “Journey to the Front Row,” Crain’s Chicago Business, May 9, 2005, ProQuest.

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media contracts had risen to nearly $18 million.119 Simply put, the immense profitability

of the professional basketball business in Chicago depended on a tiered structure of

fandom in which most Bulls faithful watched their heroes on television, while stock

traders, businessmen, and others of their ilk transformed live Bulls games into a

playground for the well-off.

***

In May 2010, famed NBA commentator Marv Albert had a chance to interview

president Barack Obama, a self-avowed basketball fanatic, about his thoughts on the current state of the league. When Albert asked the president what he would change in the

NBA if he were commissioner for a day, Obama said that his priority would be to “figure out how to price tickets so that ordinary people can go to the games…You hate to think that the only person that can go to a game is somebody who’s got a corporate account.”120 The idea that arenas were filled exclusively with corporate elites was surely an exaggeration, but Obama’s response nevertheless captured something very real.

Beginning in the late 1980s, the fan base that frequented Chicago Bulls games

underwent a qualitative shift, as steadily increasing economic barriers to entry ensured

that regular attendance became less and less realistic for most fans. As the local press

acknowledged after each of the team’s championships during the nineties, the importance

of the rallies in Grant Park derived in large part from the fact that they offered many of

the team’s followers their only opportunity to see the players in person. Perhaps those in

119 Jim Kirk, “A Franchise on the Rise but Reinsdorf Insists Estimates Way Off,” Chicago Tribune, June 23, 1997, ProQuest.

120 “President Obama Talks Basketball with Marv Albert,” Youtube, May 25, 2010, accessed August 20, 2013, http://www.youtube.com/watch?v=bnLEd7b6uqk. Perhaps not surprisingly, Obama attributes high prices to high player salaries. 149

attendance felt consoled by the chance to cheer on Jordan and company in the park, but

either way the rallies constituted a form of second-class spectatorship for those without

the money to access facilities which the Bulls operated and designed for the sole purpose

of maximizing profits.

More than anything else, the construction of the United Center demonstrated that

consumption of the Bulls was becoming increasingly stratified along class lines.

Reinsdorf’s focus on the expansion of premium seating coincided with the targeted cultivation of an elite fan base, and his success in doing so meant the permanent relegation of most fans to watching the Bulls exclusively or near-exclusively on

television. When these fans voiced their displeasure with increasing ticket prices and the

reduced accessibility of live games, Reinsdorf and the media blamed rising player

salaries. These changes, however, came about not because of player salaries, but rather as

a result of the very deliberate efforts of ownership to cater to the small slice of the public

who benefited most from the upward distribution of wealth in the last two decades of the

twentieth century.

The construction of the United Center, however, was about much more than

franchise balance sheets and the politics of consumption. In particular, the new arena

emerged as a key site of conflict over the “revitalization” of Chicago’s West Side.

Despite the media’s best efforts to portray the United Center’s role in urban

redevelopment as a win-win for team owners and local residents alike, not everyone

shared this rosy interpretation.

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Chapter Three

The Bulls as “Good Business”?: The United Center and the Struggle Over Redevelopment on Chicago’s Near West Side

As ecstatic as they were with the dominance of the Bulls during the nineties,

Chicagoans had good reason to dislike Jerry Reinsdorf, and their contempt had to do with

more than his efforts to cater to elite clientele. Well before the Bulls became a national

sensation, Reinsdorf had established a reputation within Chicago as something of a

corporate freeloader. During negotiations with the city lasting from 1982 to 1989, he threatened to move the Chicago White Sox to Florida in order to pressure the city into spending hundreds of millions in taxpayer dollars on a new South Side stadium, a move that prompted the local press to label him a “con man” and “greedy carpetbagger.”1 To

make matters worse, the new stadium displaced several poor African-American families,

many of whom languished in “cramped temporary apartments” for months beyond the

date originally scheduled for them to move into permanent replacement housing.2 The

Chicago Reader’s Ben Joravsky summed up the Sox’s attitude towards the city: “We

want a new stadium. We want somebody else to pay for it. We don’t particularly care

where it goes. It’s not our problem if little people with their homes get in the way. And,

yes, one last thing: give us what we want, or we leave town.”3

1 Judith Grant Long, “Public Funding for Major League Sports Facilities Data Series (1): Major League Baseball,” working paper, Edward J. Bloustein School of Planning and Public Policy Center for Urban Policy Research Working Paper Series (New Brunswick, NJ: Rutgers University, 2002), 40. Tom Fitzpatrick, “Sox Out to Cash In,” Chicago Sun-Times, July 9, 1986, NewsBank; John Kass and Dan Egler, “Sox Owners Tell Their Side of the Story,” Chicago Tribune, June 23, 1988, ProQuest.

2 Fran Spielman, “New Home Delay for Families Routed by Sox,” Chicago Sun-Times, October 6, 1989, NewsBank.

3 Ben Joravsky, “The Stadium Game: Who Loses if the White Sox Win?,” Chicago Reader, April 21, 1988, http://www.chicagoreader.com/chicago/the-stadium-game-who-loses-if-the-white-sox- 151

Why, then, did many Chicagoans suddenly start going out of their way in the

early 1990s to describe Reinsdorf as “heroic,” as a man genuinely “concerned about

people?”4 The new acolytes of the Bulls owner claimed he had proven his humanity by, along with Chicago Blackhawks owner Bill Wirtz, developing a close corporate- community partnership with the West Side neighborhood around the United Center. To the surprise of most, Reinsdorf and Wirtz agreed before breaking ground not only to provide millions of dollars in resident-designed housing for the handful of residents in the arena footprint, but also contributed to a new nearby library branch, helped with the renovation of a local park, and even provided low-interest loans to the local community development corporation for the construction of additional housing.

Robert Mier, the Commissioner of Economic Development under Harold

Washington and a skeptic of stadium-linked redevelopment, actually characterized the deal struck between the United Center and local residents in 1991 as “setting a standard for large public and private projects,” adding that “the precedent is in the principle that people in an affected neighborhood matter as much as the development itself.”5 And if people didn’t want to take Mier’s word for it, they could ask local residents. Earnest

Gates, a longtime Near West Sider and the head of the community development corporation in charge of turning the loans from the United Center into new affordable

win/Content?oid=872098. On the Bears stadium controversy, see Charles Euchner, Playing the Field: Why Sports Teams Move and Cities Fight to Keep Them (Baltimore, MD: Johns Hopkins, 1993) and Costas Spirou and Larry Bennett, It’s Hardly Sportin’: Stadiums, Neighborhoods, and the New Chicago (DeKalb, IL: Northern Illinois University Press, 2003).

4 Luke Cyphers, “Room With a View,” New York Daily News, Aug 23, 1998, LexisNexis.

5 Robert Mier, “A Stadium Deal that Won’t Leave Residents in the Cold,” Crain’s Chicago Business, July 8, 1991, LexisNexis. 152

housing, agreed. In 1996, he happily told a reporter, “we wouldn’t be where we are today

without the United Center.”6

The new arena’s role in neighborhood revitalization seemed like a welcome exception within Chicago’s checkered history of massive “anchor” developments in poor and working-class neighborhoods. In contrast to many nearby urban renewal projects, the construction of the United Center did not require the bulldozing of entire neighborhoods.

Moreover, Reinsdorf and Wirtz exceeded everyone’s expectations by continuing to invest in non-profit development around the arena after satisfying the terms of their initial agreement with the community. Some observers—academics included—went so far as to argue that this investment shielded local residents from gentrification that had already pushed thousands of low-income residents of color out of other neighborhoods close to the Loop.7 Undoubtedly, part of the attraction of this version of events was that it offered

reassurance that, even amidst its aggressive quest for profits, the Bulls franchise

generated “use value” for Chicagoans that went beyond entertainment or civic identity. If

the Bulls had accomplished the impossible on the court, it appeared that United Center

ownership achieved an equally unlikely feat in the blocks around the arena by showing

that grassroots revitalization and private real estate development could converge in a

model both beneficial for longtime residents and profitable for investors.

However, as Larry Bennett and Costas Spirou point out in their brief but

compelling study of the United Center, this sanguine assessment obscures the turbulent

history of a neighborhood that became internally divided over whether or not the arena

6 Betsy Wangensteen, “Guide to the Democratic National Convention,” Crain’s Chicago Business, Aug 12, 1996, LexisNexis.

7 See Alexander von Hoffman, House By House, Block By Block: The Rebirth of America’s Urban Neighborhoods (Oxford: Oxford University Press, 2004), esp. Ch. 4. 153

actually spurred equitable redevelopment. On one side of the divide, a small group of

middle-class blacks who had owned property in the neighborhood for decades came to

view an alliance with the team owners as a way to both improve the livability of the

community and increase their economic stake within it. On the other, local clerical

leaders believed the increasing emphasis on market-rate residential development

threatened the ability of the neighborhood’s poorer residents to improve their basic living

conditions. Ultimately, the protests of these clergymen fell on deaf ears, and the lay

leaders they criticized came to dominate new local institutions that would monopolize

development funds provided by the arena owners and the city.8

Spirou and Bennett’s work offers a welcome corrective to the celebratory

accounts mentioned above, but it doesn’t deal with the fact that the most effective

challenge to the redevelopment model championed by the coalition between middle-class

homeowners and arena ownership came from public housing tenants at the nearby Henry

Horner Homes. Proponents of arena-linked redevelopment, along with local officials from City Hall and the Chicago Housing Authority, saw public housing residents as an impediment to neighborhood growth, and moved to exclude them from the redevelopment process altogether. Cognizant of the pressures mounting against them from within their own community, Horner tenants looked elsewhere for allies, and found them in local public housing advocates. If there was indeed a force pushing back unequivocally against gentrification in the neighborhood, it was these public housing residents—not the United Center.

Instead of offering proof that Chicago’s growth machine could balance the needs

of neighborhood residents with the profit motives of private investors, sports-linked

8 Spirou and Bennett, It’s Hardly Sportin’, 58,156-164. 154

development on the Near West Side ultimately followed a blueprint that was far from inclusive. This blueprint ultimately reinforced three types of urban change that were

widespread in the U.S. at the end of the twentieth century, all of which ultimately served

the interests of developers focused on extracting exchange value from the built environment: first, the shift of responsibility for neighborhood revitalization from the state to the private market; second, the shift of resources away from programs intended to provide rental housing for very-low-income residents to initiatives aimed at augmenting working- and middle-class homeownership; and finally, the “deconcentration of poverty”

through the displacement of the same very-low-income residents confronted with a contracting set of housing opportunities.9 That there were any poor people left around the

arena by the end of the century owed itself to the political initiative of public housing

residents who saw the United Center for what it was: a tool used by the sports business to

extract profits from central city real estate.

“If You Want My Land, You Have to Give me Something”

In 1987, after two years of negotiations with City Hall, the Chicago Bears decided

on a 90-acre stretch of land just south of the Henry Horner Homes public housing

project—in the northwestern part of the city’s Near West Side community area—as the

site for a new football stadium (see Maps 3.1 and 3.2).10 Residents in the surrounding

neighborhood, almost all of whom were black and most of whom were poor, understood

9 Kathe Newman and Philip Ashton, “Neoliberal Urban Policy and New Paths of Neighborhood Change in the American Inner City,” Environment and Planning 36 (2004): 1151-1172

10 “Community areas” are administrative boundaries currently employed by the City of Chicago primarily for data collection purposes. The original 75 community areas—there now are 77—were mapped by Chicago School sociologists during the 1920s, and while they coincide with actual neighborhoods in many cases, in others they do not (see Map 3.1). For more on the history of community area geography, see Larry Bennett, The Third City: Chicago and American Urbanism (Chicago: University of Chicago Press, 2012), esp. pp. 26-30. 155

what was happening. At a public hearing held to discuss residents’ concerns, Cindi

Sanders, a public housing tenant at Horner, articulated the feeling shared by many in the

community that the Bears had selected the neighborhood because land was cheap and

residents lacked political clout. “When the site on the lake was proposed, a site which

would not require one displacement, these 30 white folks told the City that they did not

want the grass nor the view of the lake disturbed, told to you to go to those niggers on the

West Side,” Sanders told city officials.11 She was right. While city officials had informed the Mayor and the Bears that the proposed Near West Side site would result in extensive residential displacement, resistance from powerful, mostly white community organizations like Friends of the Parks precluded locating a new stadium anywhere else.12

11 Transcript of Public Hearing in the Matter of the Chicago Bears Stadium, February 6, 1988 at Malcolm X Community College, Box 17, Folder 7, Robert Mier Papers, Chicago History Museum.

12 Chicago Department of Planning, “Analysis of Potential Sites for Domed Sports Stadium,” October 1985, Box 21, Folder 7, Robert Mier Papers, Chicago History Museum. 156

Map 3.1. City of Chicago Community Areas by Ethnic/Racial Composition, 1990.a Sources: Shapefiles obtained from City of Chicago, Chicago Data Portal. Data on racial composition obtained from Hudspeth, “Interpreting Neighborhood Change.” a “African-American” corresponds to “non-Hispanic black” in the original data. “Latino” corresponds to “Hispanics, all races.”

157

Map 3.2. The “Better Alternative Area” According to Planning Documents from the Interfaith Organizing Project.a Sources: Bowly (1978); Interfaith Organizing Project (1987), Municipal Reference Collection, Harold Washington Library Center; Perkins & Will (1987). a The Bears stadium plan called for incorporating Chicago Stadium into its surface parking development, and for the demolition/relocation of the Henry Horner Homes Annex.

Residents from Horner and the surrounding neighborhood barely had the resources to survive, let alone mount an effective campaign against the Bears. The Near

West Side community area, one of many on the city’s West and South Sides where city officials had used the construction of public housing during the 1950s and 60s to cordon off blacks from white neighborhoods, experienced accelerated postwar

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deindustrialization and demographic decline (see Table 3.1).13 The decline proved particularly acute in the northwestern quarter of the Near West Side, ground zero for the

1968 uprising sparked by the assassination of Martin Luther King, Jr. and the site of several major housing projects like Horner and Rockwell Gardens. By the 1980s, the only regular economic activity in the neighborhood consisted of Bulls and Blackhawk games at Chicago Stadium, which, by most accounts, had virtually no interaction with the surrounding community. When the Bears selected a stretch of land immediately south of

Chicago Stadium for their proposed facility (see Map 3.2), almost sixty percent of

families in the census tracts containing Horner and the stadium lived below the poverty line.14 “It was an area so impoverished,” wrote journalist Alex Kotlowitz about Horner,

“that when Mother Teresa visited in 1982, she assigned nuns to work [there].”15

13 On the relationship between public housing and racial segregation in Chicago, see Arnold Hirsch, Making the Second Ghetto: Race and Housing in Chicago, 1940-1960 (New York, NY: Cambridge University Press, 1983).

14 For the Near West Side community area as a whole, the percentage of families living below the official poverty line in 1980 totaled 48.9% according to the 1980 census. For the tracts in the northwestern quarter of the community area (tracts 2804-2816), the figure was 57.5%. 1980 U.S. Census of Population and Housing, 1983, STF-3, Table P-11.

15 Alex Kotlowitz, There Are No Children Here: The Story of TwoBoys Growing Up in the Other America (New York: Doubleday, 1991), 12. 159

Table 3.1. Selected Demographic Data for Chicago’s Near West Side Community Area, 1940-90. 1940 1950 1960 1970 1980 1990

Total Population 136,518 160,362 126,610 78,703 57,305 46,197

% White 80.8 58.5 45.6 25.2 16.3 22

% Black 18.9 40.9 53.8 72.2 74.7 67

% Other Nonwhite 0.3 0.6 0.6 2.6 9 11

Median Family n/a $14,036 $16,656 $20,421 $13,118 $10,268 Income (1989 $) % of All Workers in n/a 41.1 29.3 31 23.7 11.3 Manufacturing % Civilian Labor Force 23.6 7.3 11.7 8 15.8 20.5 Unemployed Source: Chicago Community Inventory (1949, 1953, 1963, 1984, 1995). a Economic and employment data reported by the Census after 1960 based on sample-based estimations, as opposed to full counts. Income data is for year prior to decennial census year. Inflation adjustments made using CPI-U for Chicago Metropolitan Statistical Area. b “Percent unemployed” calculated by divided number of people reported as “unemployed” by the total civilian labor force (individual qualified as “unemployed” if: 1) they did not have a job at the time of questioning, 2) had searched for a job in the last month, and 3) were available to accept a job). These numbers, which are derived from the decennial census, vary somewhat from the estimates from the Current Population Survey (CPS) used by the Bureau of Labor Statistics to estimate monthly unemployment, which is generally thought of as more precise. Unlike the Census, the CPS does not rely on self-enumeration and involved better-trained interviewers. c Unemployment numbers for 1960 for male civilian labor force only. “Labor force” included persons 14 years and older in 1960, but subsequent surveys raised the cutoff to 16 years old.

Even as other parts of the Near West Side showed signs of recovery during the

eighties, the neighborhood around Horner continued to deteriorate. As Map 3.3 shows,

census tracts in the southern and western portions of the Near West Side community area

actually gained population over the course of the eighties, as loft development spilled westward from the Loop and residential development expanded around major urban renewal sites like the University of Illinois, Chicago. By contrast, the tracts containing the Horner Homes and Chicago Stadium continued to hemorrhage residents, as more and more public housing units became uninhabitable due to neglect by the city. By the end of

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the decade, the geography of development in the Near West Side community area was

incredibly uneven: the neighborhood where the Bears planned to relocate remained trapped in socioeconomic freefall, even as several neighborhoods directly to the east and south showed signs of revitalization. This unevenness coincided with a specific racial geography within the Near West Side (see Map 3.4). Struggling neighborhoods in north-

and southwestern parts of the community remained almost exclusively African-

American, while neighborhoods to the east—closer to the Loop—contained relatively

small black populations.

161

Map 3.3. Absolute Population Change by Census Tract, Near West Side and Surrounding Community Areas, 1980-1990.a Sources: Shapefiles obtained from City of Chicago, Chicago Data Portal; U.S. Census Bureau, American Factfinder. Full-count census data obtained from Logan, Xu, and Stults, Longitudinal Tract Database. a While the data represents 1990 counts, the tracts conform to the 2010 boundaries. The LTDB database standardizes all Census data from 1970 to 2010 using 2010 boundaries in order to facilitate better longitudinal comparison.

162

Map 3.4. African-Americans as a Percentage of Total Population by Census Tract, Near West Side and Surrounding Community Areas, 1990.a Sources: Shapefiles obtained from City of Chicago, Chicago Data Portal; U.S. Census Bureau, American Factfinder. Full-count census data obtained from Logan, Xu, and Stults, Longitudinal Tract Database.a While the data represents 1990 counts, the tracts conform to the 2010 boundaries. The LTDB database standardizes all Census data from 1970 to 2010 using 2010 boundaries in order to facilitate better longitudinal comparison.

In 1985, a few years before the Bears set their sights on the Near West Side, community organizers Karen Nielson and Ed Shurna put out feelers for Chicago churches

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interested in collaborating with them on initiatives like library construction and

grassroots economic development. Reverend Arthur Griffin, lead pastor of First Baptist

Congregational Church—just a few blocks east of the Horner Homes—offered Nielsen

and Shurna the church basement as an office, and so began a partnership that would

endure confrontations with two separate sets of stadium developers.16 The organization that emerged out of the partnership, dubbed the Interfaith Organizing Project (IOP), initially worked on a wide range of issues, but as it got wind of the Bears’ plans, it shifted its efforts almost exclusively to fighting the stadium, which local residents saw as a “land grab” (see Figs. 3.1 and 3.2).17

The IOP rallied hundreds of supporters at public hearings on the stadium throughout 1987 and early 1988, and staged gutsy actions like playing a touch football game on the front lawn of Bears owner Mike McCaskey to simulate the chaos of having a stadium nearby.18 These early organizational successes owed much to the group’s diverse

leadership. Even though the IOP was ostensibly faith-based, local lay leaders like Earnest

Gates, who had lived near the proposed stadium site since childhood and ran a West Side trucking company, took extremely proactive roles alongside pastors like Griffin and professional organizers like Shurna. According to Gates, it boiled down to having a common enemy: “There was a monster that had to be slain, and it was clear that it had to be slain, and the community geared up to do that.”19

16 Ed Shurna, interview by author, August 15, 2011, transcript available from author upon request.

17 Fran Spielman, “City Accused of Stadium Land Grab,” Chicago Sun-Times, October 1, 1987, NewsBank.

18 Spirou and Bennett, It’s Hardly Sportin’, 151.

19 Earnest Gates, interview by author, August 10, 2011, transcript available from author by request. 164

Figure 3.1. Image from an IOP Organizing Flyer. This image accompanied a call for residents to attend a meeting of Mayor Harold Washington’s Stadium Site Collection Committee at the State of Illinois Building in Chicago on April 15th, 1987. The text below the image told residents that the Bears stadium complex would “provide a playground for outsiders in our neighborhood.” Source: Robert Mier Papers, Chicago History Museum.

Figure 3.2. “Redevelopment Yes. Westside Stadium No.” Anti-Stadium Organizers Protest Outside the Old Chicago Stadium in Opposition to the Bears Stadium Proposal. Source: Chicago Tribune, October 18, 1997.

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As the IOP garnered media attention for its bold tactics, it worked with urban

planners at the University of Illinois, Chicago, whose research suggested that most jobs

created by the stadium development would not go to local residents, and that the resulting

increase in real estate values in the surrounding area would speed gentrification.20

Decades of experience with Chicago Stadium corroborated this grim outlook. Gates, speaking at a public hearing on the stadium in February 1988, lashed out against city

officials, arguing that “Chicago Stadium has not provided those brothers and sisters [from

Henry Horner] with jobs. It is a sham, it is a fallacy, and we are not buying it.”21 To

prove to local officials that it had a viable alternative, the IOP drafted a detailed plan for a

“neighborhood-controlled revitalization option.” Labeled “The Better Alternative Plan”

and delivered to the city and state legislature in Springfield in June of 1987, it outlined a

“well-structured job creation strategy” and used input from reputable low-income

housing developers to craft a proposal for financing 2,000 affordable housing units in the

neighborhood within ten years (see Maps 3.2, 3.5, and 3.6 for area covered by the plan).22

The Better Alternative Plan argued that the city and state had a unique

opportunity in the northwestern quarter of the Near West Side to prove that low-income

residents could spearhead successful neighborhood revitalization.23 The IOP’s planning documents portray a community eager to determine the shape of local revitalization and

20 Stephen Steinhoff, Making the Link: Directing Economic Benefits of the Proposed West Side Stadium to Local Neighborhood Development, Nathalie P. Voorhees Center for Neighborhood and Community Improvement (Chicago, IL: University of Illinois at Chicago, 1988), Municipal Reference Collection, Harold Washington Library Center, 21.

21 Transcript of Public Hearing in the Matter of the Chicago Bears Stadium.

22 Interfaith Organizing Project, The Better Alternative: Near West Side Neighborhood Revitalizing Plan, Chicago, IL, June 1987, Municipal Reference Collection, Harold Washington Library Center; Fran Spielman, “Bears Stadium Foes to Lobby in Springfield,” Chicago Sun-Times, June 25, 1987, NewsBank.

23 Interfaith Organizing Project, The Better Alternative: Near West Side Neighborhood Revitalizing Plan.

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skeptical of the ability of the market to deliver equitable redevelopment outcomes; and

time was of the essence, since, as the plan pointed out, “middle-class pioneers” had been moving west from downtown in recent years.24 “Few neighborhoods in walking

proximity to the Loop remain in which to encourage the cross-section of life that would truly represent Chicago’s unity in diversity,” the plan’s conclusion read. “The opportunity to turn this vision into reality is there to be taken.”25

This final point on the IOP’s anxieties about gentrification deserves elaboration.

By the 1980s the Near West Side community area contained what one local real estate

publication described as “a crazy quilt of smaller neighborhoods” (see Map 3.5), and the

spatial divisions between these neighborhoods coincided with the uneven socioeconomic

geography within the Near West Side outlined above.26 To the east of the Better

Alternative Area—between Horner and the Loop—the West Loop and West Loop Gate

neighborhoods were beginning to draw artists and young professionals eager to take

advantage of inexpensive loft space close to downtown. To the south and southeast,

respectively, the city had cleared out poor and working-class residents as part of urban renewal projects in University Village and the Medical District that, in some cases, had begun as early as the 1950s. In addition, many middle- and upper-class historic preservationists had established strongholds in the nearby Tri-Taylor neighborhood.

24 Interfaith Organizing Project, The Better Alternative: Near West Side Neighborhood Revitalizing Plan. On the IOP’s awareness of gentrification moving west from the Loop, see Fran Spielman, “Stadium ‘Only Change’ for Area,” Chicago Sun-Times, April 17, 1987, NewsBank.

25 Interfaith Organizing Project, The Better Alternative: Near West Side Neighborhood Revitalizing Plan.

26 Living in Greater Chicago (Deerfield, IL: GAMS Publishing, Inc., 1994), 73, Municipal Reference Collection, Harold Washington Library Center. 167

Thus, residents in the Better Alternative Area had good reason to fear that development hostile to low-income residents was encroaching on their neighborhood.27

Map 3.5. Neighborhood Geography of the Near West Side Community Area. Sources: Shapefiles obtained from City ofChicago, Chicago Data Portal. Basemaps provided by ESRI.

Despite the best efforts of the IOP, the city and state ignored The Better

Alternative Plan, and Eugene Sawyer, who became mayor after Washington’s death in

27 For early indications of the move of historic preservationists into Tri-Taylor, see Celeste Buck, “Bringing Buildings Back to Life,” Chicago Sun-Times, June 6, 1986, NewsBank; Celeste Buck, “Chicago Area Rehab Lives Despite Cut in Tax Credit,” Chicago Sun-Times, November 14, 1986, NewsBank; Maureen Hart, “History Walks with Neighborhood Tours,” Chicago Tribune, May 10, 1987, ProQuest. 168

1987, announced in May 1988 that the Bears had reached terms with the city to move

forward with construction. What ultimately stopped them in the following months was

not the IOP, but a tiff between Bears owner Michael McCaskey and Chicago Stadium

owner Bill Wirtz. Wirtz, whose wealth rested on a vast liquor distributorship and deep

political connections, became furious when he discovered that the aforementioned terms

involved the Bears keeping all revenues from parking lots sited on land that he owned.

His team of lobbyists promptly torpedoed legislation moving through the Illinois General

Assembly that would have authorized use of state funds for the project.28 “We always say

we defeated it,” says Shurna, “but I think if Bill Wirtz had not come into play—I don’t

think we would have defeated it.”29

As much as Wirtz’s involvement worked in the IOP’s favor, it also highlighted the continued precariousness of local residents’ position. The primacy of investors’ profit margins in determining the shape of neighborhood redevelopment had not changed; the

IOP ultimately won out against the Bears not because of success in convincing those in

positions of power that incumbent residents deserved a chance to control new

neighborhood investments, but rather because of the decision by one well-connected powerbroker to block the efforts of a competitor. Wirtz’s actions, then, did nothing to

28 This is discussed in Spirou and Bennett, It’s Hardly Sportin’. See also Letter from Thomas Tully (Wirtz counsel) to William Purdy, Jr. (Bears counsel), May 19, 1988, Box 17, Folder 9, Robert Mier Papers, Chicago History Museum. Wirtz was also upset about the fact that he felt the Bears were hogging the remaining money from a recent bond issue intended to help local teams replace or renovate their facilities. See Ray Sons, “Stadium Feud: West Side Story,” Chicago Sun-Times, July 24, 1988, NewsBank.

29 Ed Shurna, interview by author. The fact that during the final months of 1988 city officials devoted most of their energy to mediating the conflict between the Bears and Wirtz—rather than the conflict between the Bears and the IOP—corroborates Shurna’s account. City Hall believed that Wirtz—not local residents— ultimately stood in the way of the new football stadium. Evidence of this can be found in the collection of letters and memos exchanged between city officials and the lawyers representing Wirtz and the Bears for months after Wirtz killed the initial legislation. See documents in Box 17, Folder 1, Robert Mier Papers, and Box 18, Folder 3, Chicago History Museum.

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challenge the neighborhood’s core problem: that those who controlled most of the land

“lived elsewhere and thus [had] little stake in enhancing the use values of residents.”30

That Wirtz had little concern with neighborhood development independent of a

new stadium became clear when in July 1988, immediately after telling a local reporter

about his beef with McCaskey, he and his lawyers walked into a meeting with lenders to

discuss financing for a new $75-million replacement arena for Chicago Stadium in the

spot where the Bears had planned to locate their new facility.31 By October, Wirtz had

already informed the governor of his new plan, and Jerry Reinsdorf quickly signed on as

Wirtz’s partner.32 Reinsdorf and the Bulls leased Chicago Stadium from Wirtz, but the

proposed arena would be jointly owned by the two teams.

Near West Siders initially stuck to their no-stadium position. Even though

Reinsdorf and Wirtz attempted to reach out privately to IOP leadership in late 1988 to

find out what it would take to bring local residents on board, the group remained

suspicious.33 Speaking to the Sun-Times in 1989, Shurna made it clear that residents

didn’t trust the team owners. “All you have to do is look around Chicago Stadium to see

how little Wirtz has done for the neighborhood all these years,” he told the paper. Reports that the team owners had asked for $20 million in state money for infrastructural

improvements on the proposed site, and that the new arena would displace at least sixty

30 Logan and Molotch, Urban Fortunes, 112, 132.

31 Sons, “Stadium Feud.”

32 Fran Spielman, “New Arena Set-Wirtz-Secret Talk with Gov Reported,” Chicago Sun-Times, October 7, 1988, NewsBank. Data on revenues calculated from Rodney Fort, “NBA Incomes and Expenses,” Rodney Sports Business Data, updated March 2013, http://www.rodneyfort.com/SportsData/NBA/ NBAIncomeExpense/NBAIncomeExpense.html.

33 Ed Shurna, interview by author; Interfaith Organizing Project, The New West Side Story: The Story of the Interfaith Organizing Project, Chicago, IL,1992, Associated Mennonite Biblical Seminary Library, 31.

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homeowners without offering anything to the community other than cash buyouts for the

homes, made the plan a non-starter as far as the IOP was concerned.34 The mistrust on the

part of local residents was justified. In May 1989, before residents had agreed to

anything, Reinsdorf and Wirtz tried to convince the state legislature to authorize the

aforementioned infrastructural improvements. In other words, they had decided on the

boundaries of the proposed arena without the approval of the community.35

As luck would have it, the IOP found an unexpected ally in the newly elected mayor Richard M. Daley. While the legislation pushed for by the owners had made its way through the Illinois General Assembly by the end of July 1989, Daley derailed the owners’ strategy by insisting that they get the OK from local residents. Daley’s move proved pivotal, since the city owned several parcels of land that the team owners needed in order to build the arena on the scale they desired, and because the state legislation called for the city to foot part of the bill for surrounding infrastructure. The Tribune

speculated that Daley took his stance to “minimize the political fallout associated with

displacing 70 predominantly poor and black families,” and both Ed Shurna and Earnest

Gates corroborate this interpretation.36

During the summer of 1989, with Daley’s intervention having bought them some time, local residents dug in their heels and began to strategize. Some residents remained opposed to a new arena under any circumstances. Ed Shurna remembers gravitating

34 Fran Spielman, “Ministers Hit Wirtz Stadium Plan,” Chicago Sun-Times, May 9,1989, NewsBank.

35 John McCarron, “Daley Blows a Whistle on Plans by Hawks,” Chicago Tribune, May 23, 1989, ProQuest.

36 McCarron, “Daley Blows a Whistle;” Charles Wheeler and Mark Brown, “Senate Backs a New Bulls- Hawks Stadium,” Chicago Sun-Times, June 23, 1989, NewsBank. Gates, interview by author; Shurna, interview by author.

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towards this position himself, but some residents and community leaders began to

entertain the possibility of collaborating with the arena developers.37 Earnest Gates, who

by this point had emerged as the most prominent lay leader within the IOP, recalls his

own thinking as very pragmatic in this regard. “It was a community that was on the brink

of collapsing, and looked weak,” he explains. This, along with the fact that the number of

residents the new arena would displace was considerably less than in the Bears plan,

made Gates “a little more amenable to talking, to having a discussion about what

amenities a project like that could bring to the neighborhood.”38

Gates had a point. The community was even poorer than ten years before; by the

end of the eighties, over 70 percent of the families there lived below the official poverty

line.39 Moreover, major government intervention on behalf of longtime residents appeared increasingly unlikely; between 1978 and 1988, federal grants-in-aid to states

and cities as a percentage of total federal outlays fell from 17 percent to under 10.8

percent (or from 3.5 to 2.3 percent of GDP).40 At the same time, “redevelopment” policy

at both the local and federal levels increasingly favored the interests of private developers

to the exclusion of those with basic housing needs. A nearby example of this shift in

Chicago occurred in the early 1980s, when local developers secured millions in local and

federal government subsidies to construct Presidential Towers, a high-rise luxury

37 Shurna, interview by author.

38 Gates, interview by author; The New West Side Story, 23.

39 Aggregate statistic for tracts 2804-1816. U.S. Census of Population and Housing 1990, STF-3, Tables

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apartment development in the West Loop Gate neighborhood, just a mile-and-a-half east of the Henry Horner Homes. To add insult to injury, the developers secured a federal waiver of a rule requiring that residential projects benefiting from government subsidies reserve twenty-percent of the units for low-income occupants.41 Gates’s argument that

outside help was not on the way resonated with others within the IOP, and the

organization eventually rallied local residents around the slogan: “if you want my land,

you have to give me something [in return].”42

It was in this context that the IOP got to work on outlining the conditions under

which they would accept a new arena. Among other things, the plan demanded that

Reinsdorf and Wirtz agree not only to provide replacement housing for displaced

residents, but also to help fund development of additional neighborhood housing and a

new library branch. At a public meeting held in June 1989, the IOP presented the plan to

Reinsdorf and Wirtz. The Near West Siders meant business, and Gates embodied their

no-holds-barred attitude by showing up to a subsequent meeting with the developers with

a wood chip taped to his shoulder. With their hands tied by Daley, and rebuffed by a

group of elderly homeowners who refused individual buyouts, the team owners

grudgingly agreed to work with the community to reach an acceptable deal.43

41 Tiffany A. Meier and D. Bradford Hunt, “Public Dollars and Private Interests: How Skid Row Fought Back Against Chicago’s Private Developers,” Shelterforce Online 134 (March/April 2004), available at http://www.shelterforce.com/online/issues/134/presidentialtowers.html.

42 Shurna quoted in Newman and Williams, “People Power.”

43 Shurna, interview by author; The New West Side Story, 31; Joravsky, “Reinsdorf’s Secret Weapon.” As Shurna remembers it, when one of the owners’ coterie accused local residents of “standing in the way of progress” at the June 1989 meeting, community members in attendance agreed that they felt just fine doing so as long as it helped them get a fair deal. See Shurna, interview by author. Neighborhood residents received another break when local real estate developer Tom Rosenberg, a close associate of Mayor Daley who had met Earnest Gates through a local handball club, stepped into the fray. Rosenberg held a long- running grudge against Reinsdorf and Wirtz, who had allegedly interfered with some of his development projects in Chicago. When he found out about the ongoing negotiations between the IOP and the arena 173

Finally, on the night of May 9th, 1991, a year after negotiations had resumed,

Reinsdorf and Wirtz signed on to a 13-point agreement with the IOP. Per the agreement, residents displaced by the arena would not have to move until the developers completed construction of replacement housing, and the Joint Venture (the official title of the partnership between Reinsdorf and Wirtz) would establish a $600,000 escrow account for use by the Near West Side Community Development Corporation (an offshoot of the

IOP) to develop seventy-five additional homes between Damen and Western Avenues. In addition, the pact stipulated that Wirtz and Reinsdorf would lobby the city to help fund a new neighborhood park and library, as well as a construction trades program at nearby

Malcolm X Community College.44 As the Tribune reported, it looked like “the rarest of wars, a war that both sides won.”45 IOP president Arthur Griffin called it “a wonderful

victory for the residents of the West Side.” “It’s comforting to know we have all of the

neighbors behind us,” Reinsdorf added, “it’s just good business.”46

Reinsdorf and Wirtz appeared to be holding up their end of the bargain. In the

spring and fall of 1992, residents living in the footprint of the planned arena moved into

sixteen new two-flats located just west of Damen Avenue (see Map 3.2). Each two-flat

contained two 1,500-ft2 units with three bedrooms and two baths, a finished basement, a

two-car garage, oak trim, and dishwasher-equipped kitchens.47 Coming on the heels of

developers, he decided to offer his services as a “mediator,” with a personal stake in seeing the IOP succeed. See Joravsky, “Reinsdorf’s Secret Weapon;” Shurna, interview by author.

44 The New West Side Story, 33-34.

45 Mary Schmich, “Land War Turns to Mutual Respect,” Chicago Tribune, June 24, 1992, ProQuest.

46 The New West Side Story, 3.

47 Maudlyne Ihejirika, “New Stadium a Moving Event,” Chicago Sun-Times, March 29, 1992, NewsBank.

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the Bears stadium fiasco and several other recent stadium projects in the U.S.—the new

Comiskey included—where developers made few if any concessions to local residents,

the IOP’s deal no doubt struck most onlookers as too good to be true.48 Mayor Daley underscored the exceptional nature of the deal, calling it “an example of what people can accomplish if they work together,” and predicting that the new arena would result in

“jobs and economic development, but not at the expense of homes and neighborhoods.”49

Daley’s comments signaled that, in a city where the word “redevelopment”

conjured up images of backdoor dealings and displaced families, the plans for the arena

looked like proof that the returns on investment in public-private partnerships really

could trickle-down to those at the bottom. Everyone seemed to have reason to be happy:

the stadium developers got the green light to build their skyboxes, the neighborhood

finally secured some much needed resources for development without widespread

displacement, and the city got a new state-of-the-art arena without tapping taxpayers for

hundreds of millions of dollars in construction costs. Indeed, in the days following the

announcement of the deal, the local press argued that it represented a sea change in urban

politics. According the Tribune, “the successful negotiation of the agreement was in

sharp contrast to the urban renewal procedures of the 1950s and 1960s when local

residents were elbowed aside by clout-heavy developers or shunted aside into high-rise

48 For example, residents from several predominantly black neighborhoods on the outskirts of Miami lost a $100-million civil rights suit against the owner of the Miami Dolphins, who they claimed failed to obtain the necessary consent from nearby residents before breaking ground on a new football stadium in 1985. Shav Glick, “Miracle of Miami: They Said Joe Robbie Could Not Do It, but His Stadium Is Proof He Could—and Did,” Los Angeles Times, August 16, 1987, ProQuest.

49 Patrick T. Reardon, “Stadium Agreement Has Winning Look,” Chicago Tribune, May 10 1991, ProQuest.

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public housing.”50 An official IOP history from 1992 seconded this interpretation. “The

deal between the Stadium Joint Venture and the community rewrites history,” it

explained. “A largely black and low-income community was able to turn the tide of

‘urban renewal’ into a useful catalyst for neighborhood-based, redevelopment.”51

Understandably, given the fact that the Near West Side had had little to celebrate since

the riots of 1968, a popular mythology began to take shape around the agreement well

before anyone had a chance to assess its long-term impact.

50 Reardon, “Stadium Agreement Has Winning Look.”

51 The New Near West Side Story, 3, 26. 176

Table 3.2. Stipulations of the 13-Point Agreement Between Interfaith Organizing Project and Metro Chicago Stadium Joint Venture, May 9, 1991. 1. All homeowners in the footprint of the new arena are entitled to replacement housing, and the developers must complete construction of the replacement housing before said homeowners are asked to vacate.

2. Replacement homes will be constructed in the area bounded by Damen Avenue, Western Avenue, Washington Boulevard, and the Eisenhower Expressway.

3. Those homeowners not desiring replacement housing will receive fair market value plus $30,000.

4. Rental tenants in the footprint of the stadium will be provided with $6,000 in moving expenses (per unit).

5. The Joint Venture will make available a $600,000 no interest loan to the Interfaith Organizing Project to develop 75 “for sale” homes within the borders designated above in point #2. Priority will be given to buyers from the area delineated in point #2.

6. The Joint Venture will provide tax subsidies to resettled homeowners in to cover the increased taxes associated with the difference between the assessments of their old and new homes.

7. The Joint Venture will coordinate with the Chicago Park District to renovate and expand Touhy- Herbert Park.

8. The Joint Venture agrees to refrain from acquiring any land west of Damen Avenue.

9. The Joint Venture will coordinate with the Chicago Public Library to ensure that a new public library branch is built on Madison Avenue, between Western and Damen.

10. Local churches will be able to use stadium parking lots.

11. The Joint Venture agrees to lobby the City to provide funding for a construction trades program at Malcolm X Community College.

12. No simultaneous events will be held at the new arena and the old Chicago Stadium.

13. IOP recognizes the $75,000 donation by the Joint Venture to the Miles Square Health Center. Sources: Interfaith Organizing Project (1992); City of Chicago, Journal of the Chicago City Council (May 22, 1991), Municipal Reference Collection, Harold Washington Library Center.

As new and exciting as it seemed, the deal nonetheless represented a compromise that only partially addressed the demands listed in The Better Alternative Plan, which explicitly called for redevelopment without a new stadium. The various maps used to demonstrate the IOP’s vision of the plan indicated that the more than forty-five acres of land eventually set aside for the new arena would be best utilized for new residential

177

units and small-scale commercial and retail development intended to serve local residents

(Figures 3.3.A and 3.3.B), and so the agreement between the IOP and the stadium developers thus signaled the former’s acceptance that revitalization on the community’s own terms lay out of reach. 52 The group’s next best option was to accept a certain degree

of “clientelism”—a situation in which power brokers like Reinsdorf and Wirtz offered

something tangible in return for local residents’ approval of their private development

plans.53

Figure 3.3.A. Detail from the Land survey Done by the IOP for The Better Alternative Plan. The large structure in the northwestern quarter of the detail is the old Chicago Stadium. The new arena would cover nearly the entire area west of Paulina Street, and then some. Source: Interfaith Organizing Project (1987).

52 Interfaith Organizing Project, The Better Alternative: Near West Side Neighborhood Revitalizing Plan..

53 On the history and politics of urban “clientelism,” see Hirsch, Making the Second Ghetto; Logan and Molotch, Urban Fortunes; John Mollenkopf, The Contested City (Princeton, NJ: Princeton University Press, 1983); and Newman and Ashton, “Neoliberal Urban Policy.” 178

Figure 3.3.B. Detail from the Ideal Land-Use Plan Proposed by the IOP in The Better Alternative Plan. Notice that not only is there no new arena, but that the vacant land around the old Chicago Stadium has been in-filled with residential and commercial development. All of this proposed in-fill would eventually be precluded by construction of the arena, which ate up approximately fifty acres of real estate. Source: Interfaith Organizing Project (1987).

To reiterate, neighborhood residents had plenty of reason to believe that this was

their only option. Up to that point, they had averted defeat primarily by virtue of the

fallout between power brokers like Wirtz and McCaskey. These “victories” had merely

bought the community time rather than shifting the balance of power between residents

and outside development interests. In this context, historian Alexander von Hoffman

rightly concludes in his recent history of the Near West Side that leaders like Gates

“discovered the value of forming alliances with large institutions within their

neighborhoods.” However, von Hoffman’s description of residents as “a community

taking charge of its own redevelopment”—a description which echoes local journalists’

notion that the deal allowed the community to “chart its own destiny”—romanticizes the

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situation.54 The IOP undoubtedly demonstrated a lot of organizational initiative during

their struggle against stadium developers, but this alone could not redirect the flow of

capital and reinvestment back into the neighborhood until it attached itself to large-scale, for-profit development.

The deal between local residents and the team owners thus proved less about

“taking charge” of redevelopment than about taking what they could get in a political environment that, to borrow from Logan and Molotch, “required [community organizations] to join with at least some of their potential entrepreneurial adversaries” in order to survive.55 This was by no means a new phenomenon in the 1980s, but the

pressures on community organizations like the IOP to partner with private entities like

sports franchises mounted as city, state, and federal government agencies pulled back

from their fiscal commitments to distressed neighborhoods. To be sure, the IOP never

struck the same chords of militance or separatism that became popular among Black

Nationalist organizations during the late 1960s and 70s. Nevertheless, it did initially

position itself as a group fighting for a self-determined alternative to growth machine

politics, and there is no doubt that coming to terms with arena owners meant that the IOP

opted to “abandon insurrection” and “adapt to the ‘real world’, especially a liberal growth

machine strategy that holds out a practical hand.”56 By 1991, the IOP had set aside the

54 Von Hoffman, House By House, 113, 144; Rod McCullom, “Playing Ball: West-Siders and Stadium Developers Make Up a New Set of Rules,” Chicago Reader, April 9, 1992, http://www.chicagoreader.com/chicago/playing-ball-west-siders-and-stadium-developers-make-up-a-new- set-of-rules/Content?oid=879483.

55 Logan and Molotch, Urban Fortunes, 34.

56 Logan and Molotch, Urban Fortunes, 139-40. For more on the history of African-American activism in the postwar period, see Jacquelyn Dowd Hall, “The Long Civil Rights Movement and the Political Uses of the Past,” The Journal of American History 91, no. 4 (2005): 1233-1263 and Robert Self, American Babylon: Race and the Struggle for Postwar Oakland (Princeton, NJ: Princeton, 2003). 180

question put forth by Reverend Griffin in 1987: “Why can’t we just have the

neighborhood and economic development without the sports complex?”57

This is not to say that the IOP suddenly endorsed the new arena as a cure-all for

the neighborhood. After inking the deal with Reinsdorf and Wirtz, the group remained in

contact with local academics who kept leaders like Griffin abreast of an increasing

amount of data suggesting that stadiums resulted in little economic development for their

respective cities and neighborhoods.58 An update to The Better Alternative Plan

published in December 1991 concluded that the Near West Side “should be developed

with the community as the driving force, not the new…sports stadium.”59 The update

recognized that stadiums offered limited benefits for local residents, but hoped that a new

arena might “have the immediate effect of answering some of the growth needs” of their

neighborhoods.60

While the IOP understood that the new arena would not prove a panacea for the

neighborhood, members could still look on with satisfaction as residents moved into their

new housing units in March of 1992, just before construction crews broke ground on the

new arena. One of the Near West Side residents making the move told the Sun-Times that without the deal she would have likely “gone back to Alabama.”61 Predictably, the media

57 Terry Wilson, “W. Side Plan Draws Discontent,” Chicago Tribune, April 22, 1987, ProQuest.

58 See Danuzio Lima and Stephen Steinhoff, Community Resource Book, Technical Report No. 1-87 (Chicago, IL: Nathalie P. Voorhees Center for Neighborhood and Community Improvement at the University of Illinois at Chicago), August 1987. prepared for the Interfaith Organizing Project, Municipal Reference Collection, Harold Washington Library Center.

59 William Wallace, The Better Alternative (Target Area I): An Update (Chicago, IL: December 1991), prepared for the Interfaith Organizing Project, Municipal Reference Collection, Harold Washington Library Center.

60 Euchner, Playing the Field, 63.

61 Maudlyne Ihejirika, “New Stadium a Moving Event,” Chicago Sun-Times, March 29, 1992, NewsBank. 181

gushed over the unlikely alliance between residents and arena developers. “Proud

residents agree the deal was fair and generous,” the Sun-Times reported, highlighting

Reinsdorf’s assessment that, “in the end we [the team owners and local residents] came to

understand each other.”62 Robert Mier, who had by then returned to teaching at the

University of Illinois, Chicago after serving in the Washington and Sawyer

administrations, described the agreement as the “first time in this city that a private

developer had extended such a partnership to the neighboring community.”63

In 1994, just a few months before the arena—by then dubbed the “United

Center”—opened its doors, Crain’s Chicago Business continued the homage to the

“partnership” by running a glowing piece on Earnest Gates. The article discussed Gates’s

efforts as head of the Near West Side Community Development Corporation

(NWSCDC), a community development organization initially founded by the IOP in

1988 to bring additional residential and commercial development to the community by

leveraging funds provided by Reinsdorf and Wirtz. Gates told the paper that he believed

“that people have to redo their own neighborhoods…You can’t depend on the

government to do it, and if you don’t take control yourself, some developer is going to

come in and you’re out.”64 Not only could neighborhoods create symbiotic alliances with big business, but the formula for it was easy according to Gates: all one had to do was

“appeal to [investors] as businessmen,” which, in Gates own words, meant reminding them that “it only makes sense to protect your investment by investing in the

62 Maudlyne Ihejirika, “Residents Win Fair Deal the Hard Way,” Chicago Sun-Times, March 29, 1992, NewsBank.

63 Mier quoted in McCullom, “Playing Ball.”

64 Grant Pick, “The Importance of Being Earnest,” Crain’s Chicago Business, April 4, 1994, LexisNexis. 182

neighborhood and by working with the residents.”65 Gates thus emerged as a poster boy

for community development in which neighborhood organizations did more with less.66

The transformation of Gates “from conniving troublemaker to invaluable neighborhood intermediary” within establishment publications like Crain’s signaled the thoroughness with which he abandoned the language of confrontation. This was a far cry from his fiery, anti-establishment rhetoric during the IOP’s campaign against the Bears.67

However, at least on the surface, it seemed like this change in approach was paying

dividends for the neighborhood at large. Per the agreement, the arena owners followed

through on the promise of a $600,000 escrow account to provide no-interest loans for

additional neighborhood housing, and Reinsdorf and the Bulls donated $35,000 for new

basketball courts at the nearby Touhy-Herbert Park and $50,000 for a computer center at

a new library branch constructed by the city on Hoyne Avenue.

To top things off, in July 1994, Chicago won its bid to host the 1996 Democratic

National Convention at the United Center, and before the end of the month the city and

state appropriated $17 million for street improvements and beautification projects around

the arena.68 While these projects did not address directly the need for jobs and housing, they promised to make the neighborhood more hospitable for much needed retail investment. Good news for the neighborhood continued apace in the months leading up to the convention. In September 1994, the Bulls announced a $4-million-plus contribution

65 Gates quoted in Joravsky, “Reinsdorf’s Secret Weapon.”

66 The article in Crain’s was just one of many odes to Gates which, as documented by Spirou and Bennett, reversed a pattern of extremely hostile mainstream press coverage aimed at him during the Bears saga Spirou and Bennett, It’s Hardly Sportin’, 162-163.

67 Spirou and Bennett, It’s Hardly Sportin’, 162.

68 John Handley, “In Play,” Chicago Tribune, July 24, 1994, ProQuest. 183

to the construction of a new Boys and Girls Club next to the stadium. In February 1995,

the United Center issued a press release announcing the launch of the Community

Economic Development Fund, which consisted of over $1 million from the team

owners—a quarter in the form of grants and the rest in the form of loans—intended to

support the creation of neighborhood businesses and jobs.69

By the end of 1996, the community seemed to have real reason for optimism. The

team owners had transformed themselves into small-scale community bankers, injecting

upwards of $8 million in grants and loans into the neighborhood, and the Democratic

National Convention helped to radically reshape the area’s image.70 Alexander von

Hoffman argues that the capital lured to the neighborhood directly or indirectly by the

United Center allowed Gates and the NWSCDC to “stay in front of the upscaling trend that could transform the neighborhood more drastically than the [existing] residents and their leaders wish,” and which had already overtaken nearby neighborhoods like

University Village.71 However, von Hoffman neglects to mention that, by the mid

nineties, some longtime community leaders and residents who initially supported the deal

with United Center ownership had started to question whether or not the benefits of the

new arena were as evenly distributed as its proponents claimed.

The Not-So-United Center: Post-Arena Development and the Decline of the IOP

In 1988, the IOP founded the Near West Side Community Development

Corporation (NWSCDC), an offshoot organization responsible for putting The Better

69 Official United Center Press Release, February 1, 1995, Municipal Reference Collection, Harold Washington Library Center.

70 Janita Poe, “It’s A ‘United’ Effort,” Chicago Tribune, February 27, 1995.

71 Von Hoffman, House by House, 153. 184

Alternative Plan into action, and immediately handed its reins to Earnest Gates. The lack

of public and private resources constrained implementation of the plan before 1991, but

when the United Center deal injected some much needed capital into the neighborhood,

Gates and the NWSCDC finally had something to work with. The organization began

aggressively mixing and matching the money made available by the arena developers

with the limited supply of city, state, and federal funds. The city not only poured in

millions for sprucing up local infrastructure in preparation for the DNC, but also provided

a few million dollars in community development block grants to supplement the loans

and donations from Reinsdorf and Wirtz.72

While some of the money went towards the construction of new homes, the total

amount fell far short of that needed to build the 2,000 new units for low- and moderate- income families aspired to in The Better Alternative plan. This is where networking on the part of Gates and the NWSCDC became crucial. The group had to use the funds from the government and the United Center to attract new private development. In some cases, this took the form of sprucing up community institutions like parks to reassure developers that they were moving into a safe neighborhood, and in other cases it involved providing financial incentives to developers in the form of tax credits or other subsidies.73 By July

1994, the NWSCDC had used block grant money to initiate construction of a 15-unit

72 The block grant money, announced in 1993 as part of Chicago’s Strategic Neighborhood Action Program (SNAP), provided for the construction of additional “moderate-income” housing units, subsidies for “low-” and “moderate-income” homebuyers through programs like New Homes for Chicago, additional street improvements, and the additional renovations to Touhy-Herbert Park. Handley, “In Play.” According to Handley, the construction of fifteen units cost $1 million. As of 1995 the Sun-Times put the total of SNAP funds invested in the neighborhood at $2 million. See Cheryl Ririe-Kurz, “West Side Story,” Chicago Sun- Times, August 6, 1995, NewsBank.

73 Patricia Wright, Thomas Chefal, and John Cabral, A Report on the City of Chicago Strategic Neighborhood Action Program (Chicago, IL: University of Illinois at Chicago Center for Urban Economic Development, 1994), 18. 185

apartment building just two blocks east of the arena for moderate-income tenants who

would receive rent subsidies, and by the summer of 1996 the organization had started to

market single-family homes for between $150,000 and $200,000.74

Just as Gates and the NWSCDC began to build some momentum, however,

uneasiness that had been festering privately among other IOP leaders about the trajectory

of the new developments boiled over. In the years leading up to NWSCDC’s

announcement of the deal for the new single-family homes, George Daniels, assistant pastor at First Congregational Baptist Church and Arthur Griffin’s successor as IOP

president, became uncomfortable with what he saw as Gates catering to homebuyers from

outside the neighborhood. Daniels believed that longtime residents, most of whom had no

chance of securing a market-rate mortgage, would not benefit from the new housing units

planned by the NWSCDC. He also felt that Gates’s model for redeveloping the

neighborhood depended more on replacing residents than on providing longtime residents

with the opportunity to access the resources they needed to stay put and benefit from

revitalization. Unable to resolve their competing perspectives, Daniels and Gates severed

ties. Daniels remained IOP president, but ceded control of NWSCDC to Gates, who

would continue to run it as an independent community development corporation.75

The press rarely spoke to Daniels, but in December 1996 he gave his side of the

story to the Chicago Reporter. “When we began we were talking about building houses

for $80,000,” Daniels explained, “[but] when I left [the NWSCDC] they were talking

about places for $150,000.” He continued, “I couldn’t stomach it…[this] doesn’t

74 Handley, “In Play,”; Ellen Rooney Martin, “Bouncing Back,” Chicago Tribune, August 24, 1996, ProQuest.

75 Gates, interview by author; Shurna, interview by author. Spirou and Bennett discuss the split between the IOP and the NWSCDC. See It’s Hardly Sportin’, 162. 186

represent the indigenous community. That’s not the little guy.”76 To this day, Gates

dismisses Daniels’s claims, insisting that the real cause of the split had to do with the

desire of the IOP’s pastoral leadership to maintain control over neighborhood politics and

their resentment of his growing public visibility. Moreover, as Gates tells it, local

churches like First Baptist lacked a good understanding of how to manage contemporary

redevelopment. “They’re only concerned about the four walls [of the church], and not

anything taking place outside,” he says. In his rendition of the story, the housing brought

in by the NWSCDC was as cheap as it was going to get. “Now we were selling homes—

brand new homes—for around $150,000 in the 90s and then there was a subsidy attached

which would have dropped the price of the home $20,000…You couldn’t beat that.”77

Gates’s point about home prices held some water. After splitting with Gates,

Daniels and the IOP developed a few three-bedroom homes in The Better Alternative

Area that sold for around $80,000. However, the rising cost of land precluded the development of additional units at such a low price. According to a report by the Sun-

Times in 1996, land prices in the area had jumped to 1500% of their early 1980s levels.78

By 1997, the IOP could no longer develop units priced under $100,000 east of Western

Avenue, so it shifted its focus to the construction and renovation of housing further west

in the East Garfield Park community area, leaving Gates more or less unchallenged

within the original Better Alternative Area.79 In this context, one reading of the conflict

76 Burney Simpson, “City Plots New West Side Story,” Chicago Reporter, December 1996.

77 Gates, interview by author.

78 Lee Bey and William Smith, “Near West Side is Reborn—Multimillion-Dollar Projects Spark Development Boom,” Chicago Sun-Times, April 11, 1996.

79 Brenda Warner Rotzoll, “Residents Near United Center Grapple with Cost of Housing,” Chicago Sun- Times, January 6, 1997, NewsBank. The IOP continued to develop below market-rate housing in East 187

between Gates and Daniels is that the former’s pragmatism overshadowed the latter’s attempt to push back against the forces of the real estate market. Even if he compromised, at least Gates got things done in a political climate increasingly hostile to the needs of urban communities, so the story goes as told by the press and scholars like von Hoffman.

There are problems, however, with this narrative. In the first place, it papers over the legitimacy of Daniels’ concerns over escalating land values. It’s true that had the

NWSCDC built homes priced at $80,000 as Daniels wanted, most residents, especially those living in public housing, still would have lacked the requisite income. But homes like the ones Gates had developed, which required upwards of $30,000 in annual income, not only stood out of reach for all longtime residents with the exception of the handful of middle-class blacks like Gates who remained in the neighborhood, but also promised to fuel rapid and dramatic gentrification.80 Increasing the physical capital controlled by longtime residents had always sat at the heart of the IOP’s original “neighborhood- controlled revitalization option.” In theory, this would not only defend against gentrification, but also ensure the redistribution of the value lying dormant in vacant and underutilized land among these residents, rather than among land speculators, and

“enable residents, businesses, and neighborhood institutions to come together and assume leadership of the development process.”81 Gates’s focus on the development of market-

Garfield Park. See “Residential Sales Transactions,” Chicago Tribune, January 27, 2008, ProQuest. There is also reason to believe Gates’s claim that the IOP’s pastoral leadership had it out for him personally. According to Ed Shurna, who remembers trying to mediate between the two parties before leaving the IOP in 1992, everyone involved had a big ego, and the IOP pastors saw Gates as a threat. “They thought that Earnest was getting too big for his britches,” Shurna recalls. Shurna, interview by author.

80 Living in Greater Chicago: The Buyer’s and Renter’s Guide (Chicago, IL: GAMS Publishing, 1996), Municipal Reference Collection, Harold Washington Library Center. Buyers, independent of other expenses, would have needed $31,347 in annual income for a fixed rate mortgage on a house for $178,845.

81 Interfaith Organizing Project, The Better Alternative: Near West Side Neighborhood Revitalizing Plan.. 188

rate (or near-market rate) housing promised to do the opposite by attracting middle-class

residents who had no prior connection to the neighborhood. As Shurna told the Sun-

Times back in 1988, the IOP’s “goal [was] to revitalize the whole neighborhood—that

includes businesses, the schools and Henry Horner Homes.”82 In Daniels’ eyes, Gates

had lost sight of this broader commitment.

Indeed, in the coming years, Gates increasingly focused his efforts on drawing

new residents from outside of the community, marketing the neighborhood as an

attractive place to live for market-rate buyers—especially working- and middle-class

blacks—interested in an up-and-coming neighborhood.83 This approach exemplified

much larger shifts in the agenda(s) of urban community development corporations

(CDCs) away from the needs of poor and very-low income residents. As urban planning

experts Kathe Newman and Philip Ashton explain, in the mid-1990s federal policy

changes encouraged CDCs to devote more of their resources to the promotion of “low-

and moderate-income” homeownership. Specifically, the Clinton administration’s success

in rewriting the regulatory framework of the Community Reinvestment Act—a process

intended to reduce housing inequality by addressing racial discrimination in the

allocation of government subsidized home loans—ended up lowering the barriers to

financing “affordable” homeownership for financially stable working-class families of

color without doing much to create quality rental housing for poor residents.

In many neighborhoods, including the Better Alternative Area, the ultimate

outcome of these policies was that, despite the classification of most new residential

82 Harry Golden Jr. and Fran Spielman, “2 Final W. Side Site Plans Picked for Bears Stadium,” Chicago Sun-Times, January 22, 1988, NewsBank.

83 Ellen Rooney Martin, “Bouncing Back.” 189

development as “affordable,” it still remained well beyond the reach of the majority of

residents, more often than not going to new homebuyers from outside of the

community.84 Of course, this coincided with the interests of private developers and city

officials who, especially when it came to neighborhoods close to resurgent downtowns,

saw such an approach as a sure fire way to increase land rents and create new urban retail

markets. While the precise numbers are not available, there’s no doubt that much of the

community investment from the United Center went towards this type of development,

rather than providing resources for local community organizations to execute redevelopment on their own terms.

Daniels also felt that Gates’s increasing chumminess with Reinsdorf and Wirtz would further marginalize the neighborhood’s neediest residents. When Gates decided to stack the board of the NWSCDC with officials from the Bulls in the early 1990s, Daniels saw it as tantamount to treason. “This was not the vision. IOP stood in opposition to the

Bulls,” Daniels told Costas Spirou in a 2000 interview.85 He was clearly alarmed by how

the NWSCDC had emerged as the official clearinghouse for redevelopment funds that,

because of the mainstream legitimacy brought to it by support from the team owners and

the city, could unilaterally define the best interests of the “community.” As someone with a personal interest in both redeveloping the neighborhood and in seeing an increase in

property values—what Logan and Molotch refer to as “mixed-allegiance to both use and

exchange values”—Gates had fewer objections to allying with private capital.86 For him,

such an alliance meant luring investment to the neighborhood as fast as possible, which

84 Newman and Ashton, “Neoliberal Urban Policy,” 1163.

85 Reverend George Daniels quoted in Spirou and Bennett, It’s Hardly Sportin’, 162.

86 Logan and Molotch, Urban Fortunes, 133. 190

in turn meant a focus on constructing market-rate housing for new residents. This would, in theory, revive the tax base and lure private retail investment much faster than “long turnover” initiatives like poverty reduction, job creation, and substance abuse treatment, from which the “probability of value extraction is slight.”87

While Gates monopolized (and continues to monopolize) most of the public and private money coming into the neighborhood, he did not use all of it for market-rate residential development. He helped set up the new Boys and Girls Club and has administered various youth and job-training programs.88 But while in one breath Gates and the NWSCDC have insisted on overseeing “managed development aimed primarily at existing residents,” in another they have celebrated the fact that, as reported by a development partner in 2007, “demographics in [the neighborhood] are changing”—that is, becoming more middle-class.89

87 Rachel Weber, “Extracting Value from the City: Neoliberalism and Urban Redevelopment,” Spaces of Neoliberalism, ed. Neil Brenner and Nik Theodore, 172-193 (Malden, MA: Blackwell, 2002), 132. Gates’s willingness to toe the growth machine line no doubt contributed to Reinsdorf and Wirtz’s willingness to pour more money into the NWSCDC. Moreover, it gave the team owners a respectable, hard-nosed ally who came in handy outside the confines of the Near West Side. The team owners pushed for Gates’s appointment in 1993 to the board of Chicago’s Metropolitan Pier and Exposition Authority (MPEA), which oversees the operation and promotion of Navy Pier and the McCormick Place convention center. Conveniently for Reinsdorf and Wirtz, the appointment of Gates happened not long before the Bears attempted to sell the MPEA on the idea of a new domed stadium near McCormick Place. The United Center owners opposed the proposal because it would redirect bookings by concerts and circuses away from their own facility. Having an inside man like Gates on the board didn’t hurt their cause, and the MPEA quickly scrapped plans for the new dome. See “Aon Corp. Elected Richard M. Ravin Chairman and Chief,” Chicago Tribune, December 12 1993, ProQuest; Jeff Borden and Steven Strahler, “Dome Troubled, Soldier Rehab Eyed,” Crain’s Chicago Business, September 18, 1995, LexisNexis; Irv Kupcinet, “Kup’s Column,” Chicago Sun-Times, December 29, 1995, NewsBank.

88 Janita Poe, “Jordan Center Not Slam Dunk For All,” Chicago Tribune, April 27, 1997, ProQuest. Poe explains that while Gates has received accolades for his work with the Boys & Girls Club, some local residents accused him of choosing a location that was less accessible to poor children form the Henry Horner Homes.

89 Local Initiatives Support Corporation (MetroEdge), Westhaven Market Study (Chicago, IL, November 5, 2007), 2, 6. The Local Initiatives Support Corporation (LISC) is one of NWSCDC’s official development partners and funders. 191

Table 3.3. Distribution of Funds Via the 13-Point Agreement Signed in May 1991. Investment Estimated Amount Beneficiaries Replacement housing for $2.5 Million Property Owners residents in arena footprint

$600,000 escrow account for low- $600,000 Property Owners interest home loans

Tax subsidies for homeowners N/A Property Owners whose property taxes increase as a result of stadium-linked redevelopment

Donation of new basketball courts $35,000 Neighborhood Residents at Touhy-Herbert Park (park renovated/expanded by city as a result of Joint Venture lobbying efforts)

Computers for Mabel Manning $75,000 Neighborhood Residents Public Library (library branch built by city as a result of Joint Venture lobbying efforts)

Malcolm X Scholarship Fund $70,000 Neighborhood Residents

Donation to Miles Square Health $75,000 Neighborhood Residents Center Source: Local press reports (amounts are assumed to be in 1991 dollars).

To be sure, leaders like Daniels did not represent some ideologically pure counterweight to Gates. Yes, Daniels and the remnants of the IOP have continued to operate food banks, soup kitchens, and drug rehabilitation programs that cater to residents that Gates and the NWSCDC have snubbed, and in a political environment hostile to the beneficiaries of these types of programs, this deserves high praise.90 However, leaders like Daniels and his predecessor Reverend Griffin initially signed on to the 13-point plan—a plan that laid the groundwork for a model of “redevelopment” in which the bulk of funding would support expansion of homeownership instead of directly addressing the

90 For a summary of the ongoing work of the IOP and First Baptist Congregational Church in the late 1990s see, Lowell Livezey, Public Religion and Urban Transformation: Faith in the City (New York, NY: New York University Press, 2000). 192

needs of the community’s most marginalized (see Table 3.3). Perhaps they thought that

this would eventually lead to something more comprehensive, but an alliance with

stadium developers left little room for this. In fact, Daniels and his allies were neither the

only nor the most formidable challenge to the vision of growth shared by city officials,

Earnest Gates, and United Center ownership. Nearby public housing tenants ultimately

mounted more sustained and effective resistance, and more than anything it was the response to these tenants by Gates and the team owners that revealed their hostility to genuinely inclusive revitalization.

The Horner Homes and the Fight for Inclusive Revitalization around the United Center

The Henry Horner Homes was one of eleven high-rise public housing projects built by the Chicago Housing Authority (CHA) during the 1950s and 60s. In theory, projects like Horner, where the CHA had completed 920 units of rental housing for working and low-income families by 1957, represented the fulfillment of the promise made by the federal government during the New Deal to guarantee access to adequate housing for poor and working Americans.91 The 1937 Wagner-Steagall Housing Act institutionalized this commitment by empowering the federal government to distribute funds to local housing authorities, and a little more than a decade later, the Housing Act of 1949 committed the federal government to paying for 810,000 new public housing units.92 By 1961, the CHA had added 736 new units to Horner in the form of the adjacent

91 Devereux Bowly, Jr., The Poorhouse: Subsidized Housing in Chicago, 1895-1976 (Carbondale, IL: Southern Illinois University Press), 112. According to Bowly, between 1957 and 1968, the CHA completed nearly 16,000 units, and fewer than 1,000 were not in high-rise structures.

92 Janet Smith, “Public Housing Transformation: Evolving National Policy,” in Where Are Poor People to Live?, ed. Larry Bennett, Janet Smith, and Patricia Wright, 19-40 (Armonk, NY: M.E. Sharpe, 2006), 19- 22. 193

Horner Extension. In 1969, 109 additional units came on line in the form of the Horner

Annex, located just a few blocks south of the original Horner Homes (see Map 3.2).93

Many tenants who lived at Horner during the 1950s and 60s recall it as a

relatively nice place to raise a family, but in subsequent decades the project fell into

disarray. By 1991, residents and housing advocates described Horner as the CHA’s “most troubled development” and “one of the [nation’s] most distressed” public housing projects. In that year, the vacancy rate reached nearly fifty percent. According to one

public housing advocate, the list of maintenance and sanitation issues included “broken,

boarded-up and leaking windows, broken trash chutes, missing fire escape signs,

defective stairway handrails, [and] presence of human and animal waste in public areas,”

just to name a few.94

What transformed the seeming promise of a place like Horner and a “well-

intentioned New Deal program” into a “devastating urban policy failure”?95 The answer

lay in a combination of poor physical design, the racist structure and implementation of

federal housing policy, and the decline of the postwar economy. Even when funds proved

relatively plentiful in the 1950s, the federal government elected to build on the cheap in

order to produce such a large number of units so quickly. Furthermore, the growth of conservative opposition to expanding public housing appropriations restricted funding

93 Bowly, Jr., The Poorhouse, 113.

94 Quoted in Bill Wilen, “The Horner Model: Successfully Redeveloping Public Housing,” Northwestern Journal of Law and Social Policy 1, no. 1 (Summer 2006): 68. See Horner Mother’s Guild v. The Chicago Housing Authority, No. 91 C 3316, 1991 U.S. Dist. LEXIS 16632 (N. Dist. Ill., East. Div. November 13, 1991).

95 D. Bradford Hunt, Blueprint for Disaster: The Unraveling of Chicago Public Housing (Chicago, IL: University of Chicago Press, 2009), 8 194

flows.96 As African-Americans continued to flood into Northern cities from the South in

search of work in the two decades following World War II, middle-class whites followed jobs into the suburbs by taking advantage of federal loan programs. At the same time, racist real estate practices, violent resistance from white community groups, and practices such as “redlining”—the exclusion of African-American neighborhoods from eligibility for federal loan programs by administrators and banks—prevented most blacks from securing loans for new homes or home renovations. In Chicago, the political machine of

Richard J. Daley fiercely resisted the location of public housing in white neighborhoods, ensuring that projects went up only in black neighborhoods or recently cleared black slums, transforming the projects into “second ghettos.”97

The containment of working and poor blacks within public housing projects

crippled them within a changing economy. Between 1967 and 1973, as the economy

slowed and manufacturing jobs continued to leave the city, the percentage of CHA

tenants relying on welfare assistance rose from less than a quarter to more than two-

thirds.98 It was at this point that gang activity and a black market in drugs started to fill

the “social void” left by widespread unemployment.99 By the mid-1970s Congress effectively ended federally-funded construction by introducing the Section 8 program, through which eligible renters would receive vouchers to subsidize their rents in the private market. In theory, this would encourage the de-concentration of public housing

residents and boost efficiency by increasing the role of the private sector in HUD

96 Smith, “Public Housing Transformation,” 24.

97 See Hirsch, Making the Second Ghetto.

98 Hunt, Blueprint for Disaster, 185.

99 Susan Popkin, Hidden War: Crime and the Tragedy of Public Housing in Chicago (New Brunswick, NJ: Rutgers University Press, 2000), 2, 5. 195

programs.100 Unfortunately, Section 8 subsidies often proved too meager to convince private landlords and developers to open units to low-income families, and the voucher program often resulted in the transfer of CHA residents to substandard housing in the private market.101

In this context of persistent marginalization, it’s little wonder that the thousands of residents languishing at Horner in 1987 proved skeptical of the ability of a new football stadium to help them. In fact, the Bears’ stadium plans called for locating one of the end zones on top of the Horner Annex (see Map 3.2).102 At a public hearing on the

Bears stadium in February 1988, Maurine Woodson, who lived in the Annex at the time, voiced her frustration with the lack of information regarding how displaced residents would find new housing. “HUD says there is no money for new housing. You said you are going to put us in new housing…I want to know how you are going to do it,”

Woodson told representatives from the Department of Planning.103 Given that residents had waited in vain for HUD to approve a request by CHA for $1.9 million to renovate the

Annex in 1985, Woodson and her neighbors had legitimate reason for skepticism.104

100 Bowly, Jr., The Poorhouse, 182.

101 Smith, “Public Housing Transformation,” 30-31.

102 Perkins and Will, Chicago Sports Center: A Concept Plan for Near Westside Revitalization & a New Bears Football Stadium, (Chicago, IL, April 1987), Harold Washington Library Center Special Collections.

103 Transcript of Public Hearing in the Matter of the Chicago Bears Stadium.

104 David Ibata, “$20 Million Plan a First Step in Revitalizing the West Side,” Chicago Tribune, June 3, 1985, ProQuest. Horner residents also feared that a new stadium would increase harassment by police. At a public hearing on the Bears plan in January 1988, local residents told of “negative police behavior toward area teenagers and young men before and after Chicago Stadium games,” an accusation corroborated by journalist Alex Kotlowitz’s account of a Fall 1988 incident in which an officer assaulted a boy from Horner who was trying to make a few bucks waving in cars to the stadium parking lots. If the new arena did “fill [the] urban void” around Horner as the local press suggested, Horner residents believed that it would push them out in the process. Kotlowitz, There Are No Children Here, 160. Patrick Reardon, “Stadium Could Fill Urban Void,” Chicago Tribune, April 14, 1987, ProQuest. 196

The IOP, while it represented many residents not on the public housing roles, still

viewed Horner tenants as an important stakeholder during its struggle with the Bears. The

original Better Alternative Plan included a commitment to “work hard to improve public

housing in the neighborhood and to help public housing residents help themselves

improve their conditions—their housing, their access to jobs, their health care and their

generalized needs as a vital continuing part of this community.”105 When he first linked

up with the IOP, Earnest Gates also advocated on behalf of Horner residents, asserting

during a fiery public oration in 1988 that Horner “is destined to be torn down if we allow

[the stadium] to happen.”106

However, the 13-point plan agreed to by United Center ownership in May 1991

did not reference improvements to public housing (see Table 3.3). While the local press

gathered little in the way of Horner residents’ opinions regarding construction of the new

arena, by 1991 some tenants decided that they didn’t have the luxury of waiting for the

alleged “spillover” effects from the United Center to materialize. Residents were leaving,

and the CHA had stopped repairing and re-leasing vacant units despite a CHA waiting list

with tens of thousands of names on it. In response, a group of Horner tenants appealed to

the courts to stop the neglect. 107 In November 1991, aided by attorneys from Chicago’s

Legal Assistance Foundation, they sued the CHA and HUD for violating federal housing

policy by virtue of what the plaintiffs termed “de facto demolition.” The tenants argued that “by failing to maintain the Horner developments, the defendants have, in effect,

105 Interfaith Organizing Project, The Better Alternative: Near West Side Neighborhood Revitalizing Plan.

106 Transcript of Public Hearing in the Matter of the Chicago Bears Stadium, 40.

107 Between November 1981 and July 1991, the vacancy rate at Horner had ballooned from 2.3% to 49.3%—by far, the highest vacancy rate of any CHA high-rise development with over 1,000 units. Horner Mother’s Guild v. The Chicago Housing Authority, No. 91 C 3316, 1991 U.S. Dist. LEXIS 7432 (N. Dist. Ill., East. Div. May 27, 1993). 197

demolished Horner in violation of the U.S. Housing Act,” which not only required that

public housing authorities get approval for demolition from HUD prior to tearing down

any public housing structure, but also mandated the consultation of affected tenants prior

to such action.108 “The housing authority has in effect demolished a development through

inaction rather than action,” Bill Wilen, lead counsel for the tenants, explained to the

Tribune.109 Recognizing that development along the lines of the United Center could not address such profound problems, the suit demanded that the CHA halt the de facto

demolition and take immediate measures to restore higher occupancy levels.110

The case would drag on for the next several years, and as the tenants’ lawyers

argued the case in court, rumors started to circulate that the United Center and its owners

were not only providing little in the way of relief for Horner residents, but that they had

become subtle antagonists towards them.111 The rumors had to do with alleged plans to

tear down the Horner Annex—the Horner building closest to the United Center—in order

to make room for additional arena parking (see Map 3.6). In July 1994, immediately on

the heels of the announcement that the arena would play host to the 1996 Democratic

National Convention, the Sun-Times asked, “is the convention behind plans to demolish

the 109-unit annex?” State Senator Rickey Hendon, who had served previously as the

local alderman, told the paper that the city had convinced the DNC site selection

108 Horner Mother’s Guild, 1993 U.S. Dist. LEXIS 7432.

109 Michael Gillis, “Tenants Sue ‘Slumlord’ CHA,” Chicago Sun-Times, July 24, 1994, NewsBank.

110 Wilen, “The Horner Model,” 69.

111 During these years an overwhelming amount of evidence emerged in support of the plaintiffs’ accusations. Not long after the tenants filed the suit in 1991, inspectors from Chicago’s Department of Buildings recorded a total of 570 “dangerous and hazardous” building code violations at Horner. Wilen and the residents also drew the court’s attention to the fact that, despite Horner residents’ exposure to some of the worst physical deterioration and highest vacancy rates among CHA developments, CHA officials had consistently overlooked the development when distributing federal money for rehabilitation during the late 1980s and early 1990s. Horner Mother’s Guild, 1993 U.S. Dist. LEXIS 7432. 198

committee to hold the event at the United Center by assuring them that the Annex and its

residents wouldn’t be in the way. “The city said to them when they did the tour, ‘Don’t

worry about those people. They won’t be there. That’s where the parking lot will be for

you all,’ ” Hendon alleged. 112 While Hendon was well-known for his political hyperbole, both the local press and residents at Horner corroborated his claims. A few weeks before

Hendon made the accusation, the Tribune reported that the city closed down large stretches of the streets around Horner right before the visit of the site selection committee, suggesting that city officials wanted the Annex out of the picture for convention-goers.113 According to Annex resident Sarah Ruffin, CHA Chairman Vincent

Lane informed her and other residents “that the stadium wants the property, so we need to

make plans to see where we’re going to go.”114

112 Fran Spielman, “Fingers Pointed Over Demolition Plan,” Chicago Sun-Times, July 29, 1994, NewsBank.

113 Dorothy Collin and Mike Conklin, “Bidders Starting to Pipe Up For Stadium’s Organ,” Chicago Tribune, May 18 1994, ProQuest.

114 Flynn McRoberts, “CHA Wants to Demolish Three Horner Buildings Near New Stadium,” Chricao Tribune, May 18, 1994, ProQuest. 199

Map 3.6. Neighborhood in and Around the Better Alternative Area, Post-United Center Development.a Data Sources: Basemaps provided by Esri. Other data obtained from Interfaith Organizing Project (1992); Wilen (2006). a The red “West Haven” boundary indicates the NWSCDC’s stated area of community development operations.

Vincent Lane, then head of the CHA, initially admitted to a link between the new

arena and the CHA’s plan to tear down the Annex, but insisted that the DNC had nothing

to do with it. According to Lane, talks about demolishing the Annex “were going on long

before Chicago made its convention bid…the Bulls people have acquired all of the real

estate around the Henry Horner Annex. They’re going to have hundreds, if not thousands,

200

of cars and people swarming over the development.”115 But while Lane emphasized the

danger that the crowds would pose to children at the Annex, Horner residents believed

otherwise. Annex resident Stacy Springfield later recalled being “sure that to the owners

of the United Center and the yuppies that generally attend games, our building was an

eyesore.”116 Another Horner resident, John Maddox, agreed with Springfield, adding that

the demolition of the Annex must have been in the works from the inception of the arena,

despite earlier assurances from Lane that residents would have the last word on whether

or not the building would survive. “Lane kept telling us we would have the final say,”

Maddox told the Sun-Times, “[but he] knew all along they were going to tear this down

for that stadium.”117

Stadium officials responded ambiguously to the rumors. When the CHA applied

to HUD in early August 1994 for permission to demolish the Annex, Lane stuck with the

story that it would interfere with normal operations of the stadium and create an unsafe

situation for young residents. However, United Center official Howard Pizer rejected this

explanation, at least initially. When asked by the Sun-Times about the arena’s role, Pizer denied being a “player” in the controversy, insisting that the Annex land “[was] not needed for normal United Center events.”118 A few days later, however, Pizer admitted

that “we did at one time talk about whether or not it (the Annex) might come down, and

115 Spielman, “Fingers Pointed Over Demolition Plan.”

116 Stacy Springfield, “Horner Annex Reborn,” Our Voices, June 15, 1997, http://wethepeoplemedia.org/uncategorized/horner-annex-reborn/. Articles from Our Voices also appeared in Residents Journal, a publication of articles written by CHA residents from throughout Chicago, archived at: http://wethepeoplemedia.org/archive/.

117 Maudlyne Ihejirika and Gilbert Jimenez, “CHA Wants to Raze Annex—Residents in Stadium Shadow Face Move,” Chicago Sun-Times, August 4, 1994.

118 Maudlyna Ihejirika, “Arena Neighbors Wonder Why CHA Plays Hardball,” Chicago Sun-Times, August 8, 1994, NewsBank. 201

whether we could use it for parking.” “But that was two years ago,” Pizer insisted.

However, he added that the United Center might still have interest in the land if it became

available.119

Of course, Pizer never came out and said that Reinsdorf and Wirtz wanted the

Annex paved over so that fans did not have to interact with poor, black public housing

residents. Nevertheless, this explanation makes sense. As noted in Chapter Two, the

arena-building boom of the late 1980s and 1990s was driven in part by franchises’ desire

to cultivate and profit from a new market of high-income fans.120 In this context,

buffering the arena from nearby poverty with massive parking lots became an important

strategy for catering to middle- and upper-class fans. As stadium expert Charles Euchner notes, Reinsdorf already had experience in executing this strategy around the new

Comiskey Park on Chicago’s South Side. According to Euchner, Reinsdorf’s efforts to move the Sox to the Chicago suburbs came about largely as a result of marketing surveys suggesting that ticketholders fit an increasingly suburban demographic profile. When political circumstances beyond Reinsdorf’s control squelched his plans to relocate the team to the suburbs, he not only used threats of moving the team to Florida to strong-arm

the city and state into constructing a new ballpark on the South Side, but also insisted on

acres of surface parking so that, according to Euchner’s interpretation, fans could make

their way to the stadium without having to rub elbows with poor blacks living nearby.121

119 Maudlyne Ihejirika, “Horner Annex Residents, CHA OK Relocation,” Chicago Sun-Times, August 10, 1994, NewsBank.

120 See Baade, “What Explains the Stadium Construction Boom?”

121 See Euchner, Playing the Field. 202

Arena officials’ efforts surrounding the Horner Annex took place outside of the

negotiations with the IOP, and it appears that the team owners had no intention of helping

displaced Annex residents secure new housing within the neighborhood. Horner

residents not only received no direct benefits from the 13-point plan, but also found

themselves under the threat of forced relocation (which the arena owners and Gates

appear to have encouraged). Public housing tenants in the shadow of the arena not only

felt excluded from whatever “redevelopment” the arena had sparked, but also expected

that the United Center would make their lives more difficult. When asked about the

controversy, Horner resident Lena Kimbrough replied, “to tell you the truth, I really

didn’t expect them to leave us close to that new multimillion-dollar stadium, us being

low-income and black and all. I knew this was coming.”122 If Reverend Daniels worried

about the emerging trajectory of arena-driven development, public housing residents saw

it as confirmation of their long-running cynicism towards the model.

However, when Lane requested permission from HUD to tear down the Annex in

1994, the saga was far from over. Despite reports in mid-August that Lane had worked out a plan that would provide replacement housing nearby, HUD officials, Horner residents, and the residents’ lawyers all refused to sign on. By this time, Lane had changed his story, insisting that neither the stadium nor the DNC had any bearing on the situation. The real issue, according to Lane, was that “the neighborhood surrounding the

Annex has changed from residential to commercial and therefore does not provide the necessary infrastructure to promote residential life.”123 Nobody bought the explanation. If

122 Ihejirika and Jiminez, “CHA Wants to Raze Annex.”

123 Maudlyne Ihejirika, “Horner Annex Residents Face 2-Year Housing Wait,” Chicago Sun-Times, August 11, 1994, NewsBank. 203

it was a zoning issue, why were the arena developers working with Gates to build new

housing nearby? And why the rush to take down the Annex in particular, when it was in

the best shape of all the Horner buildings? As Bill Wilen pointed out to the press, it had

the lowest vacancy rate—only 8 of its 109 units were vacant—and the fewest problems

with crime.124 According to the tenants and their lawyers, the explanation involved both

the stadium and the DNC. As one Annex resident summarized, “the stadium wants the

land and the city doesn’t want us here when the convention comes to town.”125

To their surprise, Horner residents received news in September 1994 that HUD

had rejected Lane’s proposal to demolish the Annex. In a letter to Lane, Joseph

Shuldiner, HUD’s Assistant Secretary for Public and Indian Housing, wrote, “the present

proposed approach of demolishing buildings that are almost fully occupied when the

CHA has several vacant high-rise buildings at the [Horner] site is hard to understand.”126

Even better news came in March of the following year when district court judge James

Zagel found the CHA guilty of de facto demolition and approved a federal consent decree

mandating a complete overhaul of the Henry Horner Homes. Zagel also granted all

current residents the right to move into new or refurbished housing in their existing

neighborhood as long as they remained lease-compliant. Under the decree, all of the

high-rises and some of the mid-rises would be demolished, some of the mid-rises would

be rehabilitated, and Annex residents would vote on whether or not to rehabilitate or

demolish their building. A total of 699 demolished high- and mid-rise units would be

124 McRoberts, “CHA Wants to Demolish,”; Ihejirika, “Arena Neighbors Wonder Why.”

125 Maudlyne Ihejirika, “Horner Resident Fights for Home,” Chicago Sun-Times, August 14, 1994, NewsBank.

126 Flynn McRoberts, “HUD Blocks a Move to Demolish CHA Homes Near Stadium,” Chicago Tribune, September 10, 1994, ProQuest. 204

replaced by a new 699 unit mixed-income development—eventually dubbed “West

Haven”—consisting of townhomes and two-flats on the same land.127 Just as important, the ruling obligated both the CHA and the private developers contracted to carry out the project to consult with a group of tenant leaders known as Horner Resident Committee

(HRC) at every step of the process.128 The ruling represented a remarkable victory for the

tenants. Pressures from forces uneasy with their presence in the neighborhood had been

mounting for years on multiple fronts, but with the power of a federal court order behind

them, they had hope of holding these forces at bay.

The consent decree also insulated Horner residents from the upheaval in federal public housing policies during the 1990s. In 1992, HUD launched the Urban

Revitalization Demonstration Program—later renamed HOPE VI—which offered large grants to troubled public housing authorities for the demolition of blighted projects and the expansion of local Section 8 voucher programs.129 Based on the assumption that the

problems at public housing projects like Horner resulted from “poor people living

together in isolation and separated from higher-income people,” as well as on the increasingly popular idea that poor people could better exercise “personal responsibility” when exposed to the influence of the middle-class, the “mixed-income” approach embedded in the new legislation would allegedly help poor residents lift themselves out of poverty and become beneficiaries of growth in cities like Chicago.130

127 Wilen, “The Horner Model,” 70.

128 “Horner Residents Negotiate Housing Redevelopment Plans,” Illinois Welfare News, December 2001, http://www.povertylaw.org/advocacy/housing/housing-articles.

129 Smith, “Public Housing Transformation,” 44-45.

130 Janet Smith, “Mixed-Income Communities: Designing Out Poverty or Pushing Out the Poor?,” in Where Are Poor People to Live?, ed. Larry Bennett, Janet Smith, and Patricia Wright, 259-281 (Armonk, NY: 205

While this program looked good to many on paper, it came packaged with

aggressive attacks on the use of public housing as shelter of last resort for America’s

poor. For example, not long after it passed the HOPE VI legislation, Congress mandated

stiffer work requirements for tenants receiving federal housing assistance.131 These new

tenant work-requirements represented a logical extension of the Personal Responsibility and Work Opportunity Act signed into law by Clinton in 1996. The act not only resulted in the diversion of federal money previously provided for direct welfare aid to families by repackaging it as block grants which could be re-allocated by states to other programs, but also imposed strict time limits on payments received by individuals, all under the assumption that the reductions in direct aid would be offset by improved transition-to-

work programs.132

As many critics have pointed out, this new urban policy paradigm provided

municipal governments with the ideological rationale and federal fiscal support necessary

to advance central city revitalization by “deconcentrating” poverty, rather than taking

meaningful steps to address poverty’s political and economic roots.133 In particular, the

use of federal funds for the demolition of public housing offered mayors like Richard M.

Daley the opportunity to clear poor public housing residents from neighborhoods in or

M.E. Sharpe, 2006), 261. While urban sociologists have found much evidence to support the fact that economic outcomes for the urban poor have been shaped by the “spatial mismatch” between suburban job growth and the location of central city neighborhoods, they maintain that physical segregation is not the only contributing factor. Macroeconomic restructuring—in particular, the continued move away from secure manufacturing jobs—and persistent racial discrimination also appear to have exerted significant influence in recent decades. See, for example, Reynolds Farley, Sheldon Danziger, and Harry Holzer, Detroit Divided (New York, NY: Russell Sage Foundation, 2000).

131 Smith, “Public Housing Transformation,” 36.

132 On these policy shifts, see the selections in Adloph Reed, Jr., ed., Without Justice for All: The New Liberalism and Our Retreat From Racial Equality (Boulder, CO: Westview, 1999).

133 On the politics of “deconcentration,” see Newman and Ashton, “Neoliberal Urban Policy;” and the selections in Reed, Jr., ed., Without Justice for All. 206

near their respective central business districts as part of the larger effort to increase the

attractiveness of downtown investment for developers like Reinsdorf and Wirtz. When

Congress repealed a law requiring cities to replace every demolished public housing unit

with a new unit (the “one-for-one” rule) in 1996, it gave the city a green light to take the

wrecking ball to projects near the Loop without having to worry about constructing

replacements. The same year, demolition began at Cabrini Green, a massive high-rise

project bordering the moneyed Gold Coast and Lincoln Park Neighborhoods.134

The HRC and their attorneys rejected this approach. They believed that having

stable housing to begin with would prove more effective at helping people find good

employment than threatening them with eviction. With this in mind, HRC leaders like

Mamie Bone and their attorneys fought hard to ensure that the consent decree included

language precluding the CHA and HUD from imposing requirements beyond standard

lease compliance.135 In practice, this meant that the CHA could only stop a Horner tenant

from taking over a replacement unit in the same neighborhood if the tenant voluntarily

vacated the old Horner apartment while waiting for the new unit, if they stopped paying

rent or utilities before the replacement unit became available, or if the courts convicted

her/him of a felony that threatened the physical safety of another human being. Crucially,

the consent decree specified that this final condition would not be retroactive, thus giving

Horner tenants a “blank slate” and assuring them that “they themselves controlled

whether they would be eligible for a replacement unit” in West Haven.136

134 For more on Cabrini-Green, see Patricia A. Wright, “The Case of Cabrini-Green,” in Where Are Poor People to Live?, ed. Larry Bennett, Janet Smith, and Patricia Wright, 168-184-236 (Armonk, NY: M.E. Sharpe, 2006).

135 For a profile of Mamie Bone, see Mamie Bone, interview by WBEZ Radio, July 19, 2006, http://www.wbez.org/episode-segments/mamie-bone-moves.

207

Meanwhile, as the NWSCDC received praise for its work around the United

Center, Earnest Gates intervened little—if at all—on the behalf of Horner residents.137

While the NWSCDC eventually signed on to help develop some of the replacement units

for Horner residents, this happened after the court issued the consent decree (i.e. after the

federal court empowered Horner residents to stay in the neighborhood regardless of what

the city and stadium developers wanted). In fact, the Tribune, in an article detailing the

efforts by the City Council and CHA to move the replacement units into East Garfield

Park—an impoverished area west of the United Center that sat farther away from the

Loop and had few prospects for revitalization—described Gates as “more than happy

about the possibility of pushing the Horner replacement housing farther west.”138

According to Thom Finerty, a former CHA official who went to work as a consultant for

the Horner residents’ legal team, Gates’s apparent excitement over this prospect had to do

with his concern that replacement units for Horner residents covered by the consent

decree would interfere with market-rate development the NWSCDC had already planned

around the stadium.139

Despite Gates and the CHA, the redevelopment of Horner more or less remained

on track, both because of the consent decree and pressure placed on the city to get to

work on the project so that it could be showcased at the DNC. Wilen and Finerty recall

136 William Wilen, interview by author, August 16, 2011, transcript available form author upon request. William Wilen and Rajesh Nayak, “Relocated Public Housing Residents Have Little Hope of Returning: Work Requirements for Mixed-Income Public Housing Developments,” in Where Are Poor People to Live?, ed. Larry Bennett, Janet Smith, and Patricia Wright, 216-236 (Armonk, NY: M.E. Sharpe, 2006), 227.

137 On awards received by Gates and the NWSCDC for achievement in the non-profit sector, see, for example, Maudlyne Ihejirika, “Near West Side Group Honored,” Chicago Sun-Times, June 13, 1997, NewsBank.

138 Byron P. White, “Housing Plan May Go Westward,” Chicago Tribune, April 16, 1996.

139 Thom Finerty, interview by author, December 21, 2011, transcript available upon request from author. 208

that when Hillary Clinton visited the site, she insisted that the Annex either be demolished or fixed up in time for the convention. When Annex residents voted to rehabilitate instead of demolish, the CHA quickly went to work on it.140 Ultimately, the combination of the consent decree and the Clinton administration’s desire to dramatize its alleged concern for public housing tenants helped ensure that Horner became the showcase of “the CHA of tomorrow,” and meant that at least in the near-term, many low- income CHA tenants were there to stay.141 By 1997 most Horner residents who had the

option to remain in the neighborhood had declared their intention to do so. Some, wary of

CHA’s promises, did leave with Section 8 vouchers, but according to Wilen once the first

new units began to go up, remaining residents felt much more comfortable with the

prospect of remaining in West Haven.142

Why, given the fact that Gates had spoken out in defense of the Horner residents

during the Bears fiasco, had he seemingly become an antagonist towards them? No doubt

it had something to do with ensuring that money from Reinsdorf and Wirtz kept flowing

into the community. The owners had announced over a million dollars in additional low-

interest loans for local businesses in February 1995, and given their desire to buffer the

arena from public housing it made little sense for the NWSCDC to bite the hand that fed

it. As Logan and Molotch note, “given a realistic understanding of the dynamics that

created the difficulties of the underclass, the finite resources of any community

organization seem useless for helping such people,” and Gates certainly understood the

140 Finerty, interview by author, December 21, 2011.

141 Maudlyne Ihejirika, “Crusade by Horner Moms Pays Off,” Chicago Sun-Times, August 4, 1995, NewsBank.

142 Wilen, “The Horner Model.” 209

importance of catering to the “goals of outsiders, whose prospective projects need more

socially benign surroundings.”143

By this point, Chicago was no stranger to this type of revitalization. The work of historian Arnold Hirsch confirms that, throughout the postwar period, many of the city’s middle-class black community organizers joined private and public developers in backing neighborhood revitalization schemes that excluded poor people in the name of creating stable, integrated communities with a “persistent demand for good housing.” Put simply, some redevelopment projects have hinged on the success of black organizers’ efforts to retain “desirable” blacks while pushing out “undesirable” ones. In neighborhoods like

Hyde Park, “the presence of lower class blacks, or the threat of ghetto engulfment, was used, in effect, to extract housing gains for the black middle class.”144 While Hirsch

emphasizes the causal role of federal housing policy and the interests of white

developers, the recent work of Preston Smith II clarifies that the class interests of middle-

class blacks also constituted a driving force behind support for housing policy that left

“unaddressed the housing needs of many moderate- and low-income African-

Americans.”145 Gates appears to have been part of the same tradition. As the Tribune

candidly asserted in a 1996 profile of Gates, “[he] speaks for the middle class, the

143 Logan and Molotch, Urban Fortunes, 144.

144 Hirsch, Making the Second Ghetto, 170, 260. On intraracial class dynamics within Chicago’s black community, also see St. Clair Drake’s seminal Black Metropolis: A Study of Negro Life in a Northern City (New York, NY: Harcourt, Brace and Co., 1945). The Chicago comedy duo of Elaine May and Mike Nichols allegedly captured this dynamic by describing Hyde Park as “black and white united against the poor.” “South Lakefront,” eCUIP Digital Library Project, n.d., available at: http://ecuip.lib.uchicago.edu/diglib/social/cityofneighborhoods/southlakefront/con_southlakefront-history- 13.html.

145 Preston Smith II, Racial Democracy and the Black Metropolis: Housing Policy in Postwar Chicago (Minneapolis, MN: University of Minnesota Press, 2012), xviii. 210

homeowners…He is the strategic community planner who can leave the ‘hood,’ put on a

blue suit and hobnob with Daley…Reindorf…and Wirtz.”146

The evidence in support of this reading of Gates’s transformation goes beyond the

Tribune articles and the recollections of Wilen and Finerty. In June 1997, Don Adams, editor of Our Voices, a community newsletter published by Horner residents, reported that Gates had withheld the transfer of several new West Haven units developed by

NWSCDC to Horner families. While short on explanations, the article noted that “some residents of Horner feel that Gates is not trying to create a mixed community but rather trying to replace residents that now reside in the area with more affluent people [and] feel that he does not want a community of people who rent but just people who own homes,” adding that “this so-called Haven is turning out to be everything but a haven. It’s turning out to be a community of segregation and separatism.”147 The same week, the Sun-Times provided some insight into Gates’s motives, noting that he had refused to hand over additional new units per the consent decree because of alleged tenant vandalism in some townhomes that had already been released. Before releasing any more units to Horner residents, Gates wanted to beef-up work requirements and screening criteria, and insisted

on re-screening of Horner residents who had yet to move into new units before they

would be allowed to do so.148

Stacy Springfield, a Horner resident who had recently moved with her children

into a renovated three-bedroom apartment in the Annex, characterized Gates’s call for

146 Janita Poe, “A Meeting of Motives,” Chicago Tribune, August 9, 1996, ProQuest.

147 Don Adams, “Replacement Housing or Replacing People,” Our Voices, June 15, 1997, http://wethepeoplemedia.org/uncategorized/replacement-housing-or-replacing-people/.

148 Leon Pitt, “Reinsdorf Offers Aid in CHA Dispute,” Chicago Sun-Times, June 12, 1997, NewsBank; Ihejirika, “Near West Side Group Honored.” 211

increased screening as “a tactic to keep CHA residents out of what easily could be

market-rate apartments.” Springfield did not deny that some problematic issues had

arisen with a few Horner tenants who had transitioned into new housing in West Haven,

but she insisted that those issues represented the exception—an assertion backed up by

the fact that when the CHA went to court to ask for an amendment to the consent decree

mandating Gates’s desired screening requirements, the judge denied the request based on

a lack of evidence.149 Springfield also took offense at Gates’s attempt to place restrictions

on who could and could not live in the new units. “I wonder if people really believe that

vandals, gang bangers and drug addicts are all that reside in CHA,” she wrote in Our

Voices. “CHA residents made this revitalization, not just Earnest Gates.”150 For tenants

like Springfield, Gates’s push for tougher screening encroached upon the inclusivity of

the consent decree.

Nobody at Horner argued that tenants who violated their West Haven leases

should be allowed to stay, but they did believe “the vast majority of Horner residents are

law-abiding citizens,” and that as many of them as possible should have a chance to use

the “redevelopment as a way to make a new start.” Moreover, Horner residents pointed

out that persistent drug and gang activity—mostly in high-rises that had yet to be

demolished—had much less to do with shortcomings of public housing residents than it

did with the endemic shortage of jobs.151 In keeping with this outlook, in 1997 the Horner

Residents Committee established a special working group to deal with security issues in

149 Flynn McRoberts, “Judge Won’t Join Battle over Tenants for Horner,” Chicago Tribune, June 18, 1997, ProQuest.

150 Springfield, “Horner Annex Reborn.”

151 Don Adams, “Working to Improve Horner Homes,” letter to the editor, Chicago Tribune, October 11, 1999. 212

and around the redevelopment.152 Over the course of the next few years, Gates continued to push unsuccessfully for stricter tenant screening requirements, but he couldn’t get his way since the Horner residents still had the power of the federal courts behind them, and because the HRC had already started working with non-NWSCDC social service

agencies to address issues like job training and tenant orientation.153

There are some indications that Gates’s efforts surrounding the screening

requirements were not simply the result of a pragmatic outlook, but also of the belief that

he understood residents’ interests better than they did. According to Thom Finerty, who

sat in on several meetings between Gates and the HRC in the late 1990s, Gates “hated the

idea that there had been a reprieve given to anyone who committed certain crimes

previously, that they were given a second chance—he was completely opposed to that.”

Finerty adds that this outlook manifested itself in Gates’s behavior during the meetings,

in which he regularly talked down to and interrupted Horner residents, telling them that

they “needed” requirements that many tenants found extremely “intrusive.”154 Indeed,

Gates’s own recollection of the period suggests that he viewed Horner residents as a

group whose success depended on following his lead. When asked about why he pushed

so hard for tougher screening requirements, he said, “we knew and we argued that if

you’re a crackhead on the eighth floor of the high-rise that you’re going to be a crackhead

in a new condo.”155 As Horner residents threatened an already limited flow of resources

152 Wilen, “The Horner Model,” 79.

153 William Wilen, interview by author, December 21, 2011, transcript available from author upon request.

154 Finnerty, interview by author, August 24, 2011.

155 Gates, interview by author. Gates has also expressed dismay with the fact that, according to him, an overwhelming number of arrests in West Haven have involved public housing residents. Frederick Lowe, “Keeping the Faith: Saint Malachy’s Never Gave Up on the West Side,” Chicago Reader, May 11, 2000, 213

into the neighborhood because of what Gates describes as the “stigma attached to public

housing,” his uplift ideology kicked in as a justification to minimize their presence.156

When asked about Gates’s relationship to Horner, Ed Shurna admits, “you know Earnest could be a conservative Republican in some regards…You know, pull yourself up by your bootstraps, ‘I made it, you can make it.’ ”157 As Logan and Molotch argue, it is

precisely this ideology that, “in the context of the tough problems of crime, poverty, and

funding crises,” has made the “social ‘upgrading’ of a neighborhood” on the basis of

exclusion all the more “seductive” to organizers like Gates.158

Within a historical vacuum, Gates’s hostility toward Horner residents might

appear simply as political treason driven by greed for power and resources. In fact, it was an example of much larger political trends playing out at the neighborhood level. As political scientist Philip Klinker explains, the election of Bill Clinton in 1992 marked the culmination of a process begun in the early 1980s by which a large segment of the

Democratic party, panicked by the effectiveness of the appeal by Reagan and Bush to

“traditional values” and white “backlash” against black political militancy, “shed their

accessed September 15, 2013, http://www.chicagoreader.com/chicago/keeping-the- faith/Content?oid=902248.

156 Gates, interview by author.

157 Shurna, interview by author.

158 Logan and Molotch, Urban Fortunes, 143. Research on the ideological tendencies of community activists on the Near West Side conducted by geographers David Wilson and Jeremy Browning in the early nineties lends credence to Finerty’s account of the seemingly insensitive approach to public housing residents taken by Gates. Eleven of the sixteen community/organizational leaders that they interviewed in the community area “ranked residents [as opposed to private developers, city government, or federal government] as either most important or important in creating the community’s current condition.” Wilson and Browning note that this ideology led social organizations on the Near West Side to “disseminate values of self-reliance, individualism, and need for normative social conduct to residents.” The surveys were confidential, so we cannot know whether or not they interviewed Gates, but the general tendencies noted by the researchers seem very much in line with his perspective. See David Wilson and Jeremy Browning, “Politics and Community: Chicago’s Near West Side Black Underclass,” Journal of Economic and Social Geography 85, no. 1 (February 1994): 58-60.

214

traditional support for and identification with the poor, the working class, and minorities

and…[reached] out to disaffected whites and economic elites by moving to the right on

issues such as crime, affirmative action, welfare, and economic justice.”159 Clinton

secured the presidency not only by reassuring big-business of his commitment to the

“free market,” but also by playing to the subtly but thoroughly racist belief that the

country’s problems lay squarely in the hands of inner-city communities of color that

refused to pull their own weight. It was in this context that Clinton expressed

“understanding” of the “fears” of “white people [who] have been scared so long that they

have fled to the suburbs” and highlighted increased “personal responsibility” as the key

to social and economic uplift.160

It made sense that, at a moment in which the Democratic establishment aped

many of the same keywords as their Republican counterparts, a “bootstrap” advocate like

Gates emerged as a local powerbroker in urban politics. Born in 1952 just a block east of

the old Chicago Stadium, he had watched the neighborhood burn in 1968 and lived

through its subsequent decline. Instead of using the money he made with the trucking

business he founded in the late 1970s to move away, he took it upon himself to rebuild

the neighborhood a block at a time by rehabbing crumbling houses.161 Gates was

“personal responsibility” in the flesh—proof positive of the “New Liberal” ideal

forwarded by Clintonites. Conveniently, the media’s praise for Gates usually left out the

159 Philip Klinker, “Bill Clinton and the Politics of the New Liberalism,” in Without Justice for All: The New Liberalism and Our Retreat From Racial Equality, ed. Adolph Reed, Jr., 11-28 (Boulder, CO: Westview, 1999), 12.

160 Bill Clinton, “Our American Community,” Speech to the Democratic Leadership Council, New Orleans, LA, May 2, 1992, in Preface to the Presidency: Selected Speeches of Bill Clinton, 1974-1992, ed. Stephen A. Smith, 144-155 (Fayetteville, AK: University of Arkansas Press, 1996), 148.

161 Gates, interview by author. 215

fact that he, unlike the majority of residents living around the new arena, was born to

parents economically stable enough to move into the neighborhood when it was still

predominantly white.162 Minus this information, he offered a timely poster boy for the

increasingly dominant politics of “self-help” and “trickle-down” economics.

Gates also represented a continuation of—or return to—what political scientist

Adolph Reed, Jr. describes as a long-running tendency within the African-American middle-class towards “accommodationism” and “racial uplift” indifferent—or even hostile—to the needs of low-income blacks. Reed summarizes the ideological origins of this political phenomenon during the Jim Crow era:

[Black] fin de siècle accommodationists’ notions of what was politically possible and feasible derived from a particular sense of how the world worked. Prevailing beliefs that social development—in general and among African-Americans in particular—is properly and most effectively steered by enlightened upper classes disposed black accommodationists toward strategic goals and a politics that emphasized the importance of alliances with white elites as both desirable and necessary.163

While Reed acknowledges that the Black Power movement rejected the politics of

accommodationism, he adds that it fell into the same intellectual trap of assuming a

unified black identity, and thus failed to articulate “an effective language or practice of

political opposition” that addressed both racial discrimination and the politics of class

inside and outside of the black community. As a result, “the hegemonic national political

discourse has moved ever more in a conservative, victim-blaming direction,” and “the

black elite has moved along with it.”164

162 Dawn Turner Trice, “Leader Stayed Loyal to West Side,” Chicago Tribune, September 6, 2010, ProQuest.

163 Adolph Reed, Jr., Stirrings in the Jug: Black Politics in the Post-Segregation Era (Minneapolis, MN: University of Minnesota Press, 1999), 22-23.

164 Reed, Stirrings in the Jug, 205. 216

The point here is not that Gates was a bad person, or that accommodationism has

produced purely reactionary outcomes. Rather, the analyses of scholars like Klinker and

Reed remind us that Gates’s actions were shaped by structural shifts in the American political landscape at the end of the twentieth century, as well as by the ideological history of the black middle class. Recounting the efforts of Horner residents to push back

against these larger political and historical forces highlights the failure of hagiographic

accounts of Gates to consider the fact that “black politics” around the United Center—in

particular, decisions about whether to prioritize use values or exchange values—was far

from a unitary enterprise.

Apparently having come to terms with the fact that he would not be able to

subvert the consent decree, Gates struck a note of compromise in 1999 when he informed

the Horner Residents Committee that the NWSCDC would use funds provided by Jerry

Reinsdorf to run the “Home Visitors Program.” 165 A Gates-designed initiative operated through the NWSCDC, the program aimed to help Horner residents make a smooth transition to West Haven by addressing “poor housekeeping skills” and connect with relevant social service agencies. To the liking of the HRC, Gates indicated that participation in the Home Visitors Program would be voluntary, and that it would work alongside other social service programs coordinated by the HRC.166

However, Gates quickly reneged on his commitment to making the program

available on a voluntary basis. Around the same time that Gates presented the program to

the HRC, Mayor Daley appointed him to the Board of Commissioners of the Chicago

165 Pitt, “Reinsdorf Offers Aid in CHA Dispute.”

166 Horner Mother’s Guild v. The Chicago Housing Authority, No. 91 C 3316, 1991 U.S. Dist. LEXIS 13605 (N. Dist. Ill., East. Div. August 31, 2001). 217

Housing Authority, which meant that Gates suddenly found himself in a position to make

official policy recommendations concerning the remaining phases of the Horner

redevelopment at West Haven. Despite the fact that the consent decree designated a

primary social service coordination agency independent of both the CHA and the

NWSCDC, the CHA, under heavy lobbying from Gates, unilaterally replaced the

independent agency with the Home Visitors Program in 2000, effectively making it

mandatory for Horner residents. Once they figured out what had happened, the HRC and

their attorneys called for Gates’s resignation from the CHA board on the grounds of a

conflict of interest, since he had effectively convinced the CHA to fund a program run by

the NWSCDC, where he remained a “non-paid board member.”167 Gates would also

come under serious fire for using his weight on the CHA board to grant NWSCDC

additional contracts for housing development in the second phase of replacement unit

construction at West Haven, an effort that he quickly abandoned when Wilen blew the

whistle on it in the local press.168

For Gates and the NWSCDC, a redevelopment strategy “which welcomes higher-

income residents while calling for tougher management of the various subsidized

developments and strong support systems for the existing low-income population”

ultimately became code for a form of demographic re-engineering that uses appeals to

167 Curtis Lawrence, “Critics Clamor for Ouster of CHA Board Member,” Chicago Sun-Times, June 21, 2001.

168 Chinta Strausberg, “Law Center, CHA Residents Demand Gates Resignation,” Chicago Defender, August 11, 2001, ProQuest. Von Hoffman’s rendition of these events is much more saccharine. He writes, “when the Chicago Housing Authority began to reconstruct Horner as a mixed-income subdivision of brightly painted, quaint-looking, single-family row houses, Gates and Ward were dismayed to discover that the CHA had not kept out residents with serious criminal records and leaned on the agency to be more selective. After that, Gates became a member of the board of the CHA, and the Near West Side Community Development Corporation extended its services to the Horner development, instituting a home visitor program to help families adjust to life in their new homes.” Von Hoffman, House by House, 153. 218

“diversity” as a Trojan horse for distancing redevelopers from poor residents.169 This

foreshadowed broader shifts in public housing’s relationship to community development

in Chicago. “The Plan for Transformation,” a $1.5-billion dollar HOPE VI initiative

announced by the CHA in 1999, has reduced the number of CHA units in Chicago by

over 18,000, and created several “mixed-income” communities where now-demolished

high-rises used to sit. In order to facilitate the “mixing,” the CHA has worked under the

“assumption that neighborhood improvement will be effected by removing a large share

of the public housing population,” encouraging the permanent transition of as many

families as possible to Section 8 vouchers (now officially dubbed “Housing Choice

Vouchers”) so that, according to the theory behind the initiative, they would move into

private market housing in low-poverty, economically stable neighborhoods.170

However, like their counterparts at Horner, CHA tenants caught up in the Plan for

Transformation have encountered serious obstacles to taking part in for-profit

“redevelopment.” At the outset of the plan, tens of thousands of public housing residents

at projects other than Horner had to relocate temporarily with vouchers, but were

guaranteed the “right of return” by CHA if they wanted to come back to their original

communities. However, by 2009 less than ten percent of temporarily relocated former

high-rise residents had successfully moved back into the mixed-income communities

CHA had promised them. In some cases, increasingly rigorous screening and work

requirements made them ineligible while they waited for new units, and in other cases

169 Near West Side Community Development Corporation and Local Initiatives Support Corporation, More than Bricks and Mortar: A Quality of Life Plan for West Haven (Chicago, IL: 2002).

170 Larry Bennett, Nancy Hudspeth, and Patricia Wright, “An Analysis of the ABLA Redevelopment Plan,” in Where Are Poor People to Live?, ed. Larry Bennett, Janet Smith, and Patricia Wright, 185-215 (Armonk, NY: M.E. Sharpe, 2006), 199. 219

construction delays led frustrated families to break off contact with CHA relocation

officials. Those forced to languish with Section 8/“housing choice” vouchers in a tight

rental market have more often than not ended up in substandard housing in poor and

segregated neighborhoods—the exact opposite of the voucher program’s stated intent.171

As both public housing residents and advocates argue, it would appear in light of these

outcomes that the promotion of mixed-income developments, especially in gentrifying

neighborhoods near the Loop, has proven “little more than a justification for the removal

of poor families” from neighborhoods coveted by real-estate investors and market-rate homebuyers.172

Because of their consent decree—the only one of its kind within the CHA

system—Horner residents have avoided many of these obstacles. Well over half of the

residents at Horner exercised their right to stay in the neighborhood, and nearly all of

those who did received a new or rehabilitated unit in West Haven by the end of 2008.

Fifty percent of the families affected by Phase I of the redevelopment elected to stay, as

did seventy-five percent of the families affected by Phase II. Moreover, according to

Wilen, as of 2006 all of the residents affected by Phase II who opted to stay remained at

Horner (see Map 3.6 for the areas affected by each phase). Compared to nearby

redevelopments on former high-rise sites like Cabrini Green, West Haven boasts the

highest percentage of units set aside for low-income families. Per the consent decree,

nearly half of the new units in West Haven belong to low-income families (most of these

fall into the “very low-income” category), while most other “mixed-income”

171 “Telling Our Story,” Chicago Video Project, 2009, http://www.chicagovideo.com/library.php.

172 Bennett, Hudspeth, and Wright, “An Analysis of the ABLA Redevelopment Plan,” 205. 220

developments set aside barely a third for such families.173 Since the decree barred

relocating residents before developers completed new units at West Haven, the CHA

could not shotgun tenants into an inhospitable rental market where they were likely to fall

through the cracks. The fact that Horner tenants enjoy a set of work, training, and

education requirements considerably more flexible than those at other mixed-income developments has provided them some semblance of security in the face of a persistently grim employment market. Moreover the decree’s mandate that tenants have an active role in any modifications to the development has limited the power of private developers and non-profits like NWSCDC to unilaterally initiate programs and requirements in line with their own agendas.174

No doubt thankful for their new housing, former Horner residents at West Haven

still face a reality in which, to private redevelopment interests, they represent first and

foremost a financial liability. The United Center has done nothing to change this. If anything, the primary function of the arena—other than enriching its owners—has been to provide leaders like Gates with the resources to pursue “redevelopment” on the paradoxical terms dictated by Chicago’s growth machine, within which “it becomes necessary to destroy at least part of the neighborhood in order to save it.”175

* * *

In February 1988, at a public hearing on the Bears stadium proposal, a Near West

Side resident named Loretta Roland made a bold proposal to city officials. Roland told

173 Wilen, “The Horner Model,” 80. Also see Bennett, Hudspeth, and Wright, “An Analysis of the ABLA Redevelopment Plan.”

174 See “Telling Our Story,” Chicago Video Project; Wilen, “The Horner Model.”

175 Logan and Molotch, Urban Fortunes, 145. 221

the officials that she would welcome a new stadium, provided that local residents could

jointly own the facility and receive a fixed percentage of its profits. Predictably, the

officials brushed aside the idea, and it never came up again.176 As little attention as her

proposal received, Roland clearly understood the stakes of constructing a new stadium in

her neighborhood. The way the team owners and city would have it, residents would

receive a pittance of the value generated by the new facility. Public ownership of the

stadium might go a long way to solving this problem, and, as the history of the United

Center demonstrates, even the seemingly charitable disposition of owners provided a

weak and at times insidious substitute for placing control of redevelopment resources in

the hands of community members themselves.

As much as its proponents argue—and continue to argue—to the contrary, the

redevelopment of the community now known as West Haven has stood out not because

of some unprecedented partnership between a professional sports arena and neighborhood

residents, but rather because of the efforts of a small group of largely forgotten CHA

tenants. Their story reminds us that the professional sports business offered no real

solutions to the ongoing conflicts sparked by divergent visions of redevelopment within

the American inner city. As the next chapter shows, claims that arena-linked development

would transform West Haven into fertile ground for the production of exchange value for

more than just Reinsdorf and Wirtz also turned out to be overinflated, if not patently

incorrect.

176 Transcript of the Public Hearing In the Matter of the Chicago Bears Stadium, City of Chicago Department of Human Services, Kedzie Avenue Branch, February 6, 1988, Box 17, Folder 7, Robert Mier Papers, Chicago History Museum. 222

Chapter Four

“Anchor” or Shipwreck?: The United Center as Urban Development Flop

A little over a month before he left office in 2011, Richard M. Daley kicked off his “Neighborhood Appreciation Tour,” a series of appearances in Chicago neighborhoods where the mayor waxed poetic about the alleged strides made by the city under his watch. From the podium at the first tour stop, he went out of his way to mention how the United Center had fulfilled its promise as the private solution to persistent economic underdevelopment in the Near West Side. Two full decades after the Interfaith

Organizing Project reached terms with Reinsdorf and Wirtz, Daley “pointed to the construction of the [arena] as a key moment for the West Side on his watch.” According to the Mayor, “it allowed the city to host the 1996 Democratic National Convention, and served as an anchor for revitalization.”1

If skeptics had a hard time taking the Mayor’s word for it, maybe they felt more compelled by reputable news sources outside of Chicago. For example, in a television report on recent trends in urban redevelopment aired by PBS Newshour in 2005, on-air anchor Elizabeth Brackett assured viewers that “it was private investment [in] the United

Center that started the revitalization of the [Near] West Side.” Moreover, by reminding everyone that arena ownership “continued to stay involved in the neighborhood,” she did her part to keep alive the idea that the United Center was a win not only for the team owners, but also for local residents.2 And who could blame her? The same interpretation

1 John Byrne, “For Daley, Goodbyes Begin,” Chicago Tribune, April 8, 2011, ProQuest.

2 Elizabeth Brackett, “Community Redevelopment Reforms Spark Funding Concerns,” PBS Newshour (April 7, 2005), television transcript, accessed May 13, 2013, http://www.pbs.org/newshour/bb/business/jan-june05/housing_4-7.html. 223

came straight from Earnest Gates and the Near West Side Community Development

Corporation (NWSCDC), which produced official documentation insisting that stadium-

linked “revival [in West Haven] should continue to find a place for—and not displace—

those who have weathered the lean years.”3

We know from the political and social histories explored in Chapter Three that

things were not so simple. In particular, claims about the inclusivity of stadium-linked

development in the Near West Side papered over how the priorities of the United Center

coalition diverged from and often conflicted with those of low-income residents. But

while these histories give the lie to the alleged inclusivity of the revitalization efforts

supported by local sports teams, they tell us little about the tangible transformation of the

social, economic, and built environments in West Haven that accompanied the

construction of the new arena.4 For example, that the team owners and their allies excluded public housing residents from their revitalization plans does not necessarily prove the hypothesis of Costas Spirou and Larry Bennett that the United Center would

“speed a one-sided gentrification” of the neighborhood.5 In fact, Horner residents’

success in securing their place in the neighborhood through the consent decree cast real

doubt on the degree to which displacement would occur around the arena. Moreover, if

the political histories outlined in the last chapter reveal little about actual demographic

change in West Haven, they reveal even less about whether or not the United Center

3 Local Initiatives Support Corporation, West Haven: Rising Like the Phoenix, LISC Chicago’s New Communities Program (October 2007), accessed May 13, 2013, http://www.newcommunities.org/cmadocs/WHaven_NCP_Plan_07.pdf.

4 For the purposes of this chapter, “West Haven” refers to the neighborhood surrounding the United Center—not just the redeveloped Horner site which goes by the same name. Accordingly, I note when I am referring specifically to the blocks where the Henry Horner Homes used to sit. There is a more detailed discussion of the post-United Center geography of the West Haven neighborhood later in this chapter.

5 Spirou and Bennett, It’s Hardly Sportin’, 175. 224

functioned as an economic development boon for the surrounding neighborhood

(irrespective of who stood to benefit).

This chapter details the demographic and economic changes that accompanied the

political conflicts around sports-linked development on Chicago’s Near West Side. In

addition to analyzing traditional archival materials, it uses basic spatial analysis

techniques to tell a story about why Horner residents were justified in their skepticism

regarding the United Center’s potential to induce equitable revitalization. Census records,

land-use data, and public and private planning documents suggest not only that the arena

development failed in terms of inclusivity, but also that characterizations of the United

Center as an engine of local economic development were seriously exaggerated, if not

outright wrong.

Mapping demographic change in the neighborhood around the United Center

during the 1990s and 2000s shows that sports-linked development on the Near West Side coincided with the continued exodus of longtime residents. This is not to say that the arena caused people to leave the neighborhood—important institutions and historical forces aside from the United Center exerted influence at the same time. However, the data casts serious doubt on the arena’s alleged function as an anchor for “balanced” redevelopment accessible to new and longtime residents. If anything, the “mixed- income” revitalization pursued by Gates and funded in part by arena ownership appears to have contributed to a situation in which, to borrow from two prominent housing activists, many “poor African-Americans who…suffered through years of neglect…and extreme segregation [were] not able to participate in the revival of their communities.”6

6 William Wilen and Wendy Stasell, “Gautreaux and Chicago’s Public Housing Crisis: The Conflict Between Achieving Integration and Providing Decent Housing for Very Low-Income African Americans,” 225

Aside from claims about inclusivity, the argument made by United Center boosters that the arena sparked a wave of local economic growth on the Near West Side was presumptuous at best, and misleading at worst. Historical and spatial data suggests that new investment in and around West Haven likely would have occurred with or without the United Center given the neighborhood’s close proximity to the Loop, from which new residential and commercial development had been radiating outward since the

1980s. Some with an intimate knowledge of the area’s history believe that the arena actually impeded further investment in the neighborhood. Given what we now know, the most optimistic reading of the United Center’s role in local economic growth is that it helped draw attention to and accelerate the westward expansion of development from the

Loop into the Near West Side. While it’s impossible to know what surrounding neighborhoods would have looked like today in the absence of the United Center, there are plenty of reasons to believe that economic growth in the blocks surrounding the arena depended minimally, if at all, on the new sports facility.

Even if one accepts the claim that the United Center motivated ancillary economic development, there is little doubt that the design of the arena seriously limited the extent of its impact. Planning documents produced by the city and independent community development organizations after the United Center opened in 1994 criticized the project for internalizing economic activity at the expense of surrounding commercial investment, as well as to the detriment of neighborhood residents’ quality of life. These criticisms corroborate the position of economists and urban planners that arenas like the United

Center have precluded, rather than encouraged, positive economic “spillovers.”

in Where Are Poor People to Live?: Transforming Public Housing Communities, ed. Larry Bennett, Janet Smith, and Patricia Wright (Armonk, NY: M.E. Sharpe, 2006), 249. 226

Delving into the spatial and planning history of the United Center does more than vindicate the skepticism of Horner residents and others who continued to question the wisdom behind using a sports arena to revitalize a low-income neighborhood on the edge

of Chicago’s central business district. It also suggests that, even when scrutinized outside

the contexts of race and class, the United Center’s relationship to the surrounding

community’s economic growth proved dubious. To put it another way, not only did the

arena do little to enhance the use values of the surrounding neighborhood for longtime

residents, it appears to have had a minimal effect—perhaps even a negative effect—on

the ability of West Haven to produce exchange value for anyone other than Reinsdorf and

Wirtz.

The Logics of “Successful” Development around the United Center

As Chapter Three details, Chicago elites hailed the United Center as the harbinger

of a new era of public-private partnerships in which large-scale, profit-generating

developments allegedly produced trickle-down benefits for poor residents. Sometimes,

arena boosters asserted this claim as a self-evident truth. Just as often, however, they

backed up their assertions with arguments that referenced concepts like “economic

spillover” or “ripple effects.” Most of this chapter deals with how these arguments

misrepresented the arena’s impact. Before we get there, however, it helps to have a sense

of the range of claims made by boosters about exactly how the arena functioned as a

centerpiece of economic and social revitalization.

During its struggle against the Bears, the Interfaith Organizing Project rejected the

media’s claim that a new sports facility promised “economic salvation for the

227

community.”7 The IOP’s stance was far from kneejerk. Faculty and students from the

University of Illinois, Chicago who collaborated with the group found little evidence

from sports-linked development in other cities to suggest that a new stadium would help

reverse the fortunes of local residents. A 1988 report written by members of UIC’s

planning department noted:

In only 9 of the 22 cities [that have built or remodeled stadiums in the last twenty-five years] is there commercial activity in the area immediately adjacent to the stadium. In 5 of the 9 cities the growth around the stadiums was part of expanding downtown areas…Only in Kansas City did a stadium by itself, in the opinion of the planner interviewed, spur growth around it.8

However, these facts suddenly seemed less relevant when, in the wake of the Bears’

failed stadium development efforts, Reisndorf and Wirtz promised the IOP that local

residents would get something in return for their endorsement of what would eventually

become the United Center. As the ink dried on the agreement, Mayor Daley confidently

asserted that it was the “first step in the rebirth of the economically depressed West

Side,” and IOP president Reverend Arthur Griffin confirmed that it represented a

“wonderful victory for the residents of the West Side.”9

In subsequent years, the press and local officials repeated the assertion that, by catalyzing revitalization without triggering displacement, the United Center succeeded where so many other stadium developments had failed. “The Near West Side is shedding its reputation as a three-word synonym for urban blight,” two columnists for the Sun-

7 Patrick Reardon, “Stadium Could Fill Urban Void,” Chicago Tribune, Apr 14, 1987, ProQuest.

8 Stephen Steinhoff, A New Sports Stadium: Can it Bring Economic Benefits to Residents of the Near West Side?, Technical Report No. 4-87 (Chicago, IL: The Nathalie P. Voorhees Center for Neighborhood and Community Improvement at the University of Illinois at Chicago, 1988), 16, Municipal Reference Collection, Harold Washington Library Center.

9 Patrick Reardon, “Stadium Agreement Has a Winning Look,” Chicago Tribune, May 10, 1991, ProQuest. 228

Times remarked in 1996, “and the United Center is taking a few bows.”10 Around the same time, a spokesman for Chicago’s Department of Planning and Urban Development reiterated that “the United Center has totally spurred the area’s development,” while reassuring Chicagoans that it had also helped “preserve the existing community during the process.”11

What made this project different from the many stadium developments which,

according to the planners at UIC, had failed to stimulate economic activity nearby and/or

threatened longtime residents by ushering in gentrification? Over the course of the 1990s,

boosters developed four primary responses to this question. First and foremost, they

pointed to the millions of dollars in direct investment—grants, loans, and charitable

contributions—made by the team owners, and especially by Reinsdorf and the Bulls. The

13-point agreement discussed in the previous chapter committed Reinsdorf and Wirtz to

upwards of $3 million of direct investment in the neighborhood for replacement housing,

seed money for the NWSCDC, and upgrades to community infrastructure (see Table 4.1).

In a community ignored by developers for decades, this influx of capital convinced

reporters that the new arena was nothing less than the “the lifeline to economic revival of

the west side.”12

The money from the 13-point plan did make a difference in the neighborhood.

Historian Alexander von Hoffman estimates that funds from the United Center helped

Gates and the NWSCDC construct seventy-five new homes—albeit for new residents—in

10 Lee Bey and William Smith, “Near West Side Is Reborn,” Chicago Sun-Times, April 11, 1996, ProQuest.

11 Bey and Smith, “Near West Side Is Reborn”; John Handley, “United Front,” Chicago Tribune, June 30, 1996, ProQuest.

12 “United Center’s Helping Hand,” Chicago Sun-Times, February 5, 1995, ProQuest. 229

the years following the agreement. Moreover, the team owners impressed local media by

continuing to funnel resources directly into the community above and beyond the terms

of the 13-point plan, and in some cases longtime residents did benefit. For example, in

1996 Reinsdorf donated the proceeds from a $100,000 fine levied by Bulls management

against Dennis Rodman for an “obscenity-laced tirade” to the NWSCDC. The NWSCDC put the funds towards residential beautification, and the local papers rushed to quote

Margaret Glenn, a longtime homeowner who received a new fence and refurbished façade courtesy of the donation. “I love Rodman because he gave me this [fence], he can say anything he wants to say,” Glenn told the Tribune. For the paper, Glenn’s good fortune encapsulated “two intertwined and equally improbable transformations: the creation of a sports dynasty in Chicago and the revival of the Near West Side.”13 By the

end of the nineties, the teams had injected upwards of $10 million into West Haven.

13 Burney Simpson, “City Plots New West Side Story,” Chicago Reporter, December 1996; Ron Grossman and Flynn McRoberts, “Near West Side Rebounds Like its Bullish Neighbors,” Chicago Tribune, June 7, 1998, ProQuest. 230

Table 4.1. Direct Neighborhood Investment by United Center Ownership. Investment Source Amounta Year Reported Replacement housing (16 two-flats) United Center $2,500,000 1991

$600,000 escrow account for low-interest home United Center $600,000 1991 loans (managed by NWSCDC)

Property tax subsidies for longtime, local United Center N/A 1991 homeowners

New basketball courts for Touhy-Herbert Park Bulls $35,000 1991

Computers for Mabel Manning Public Library Bulls $75,000 1991 (library itself paid for by city)

Malcom X Scholarship Fund United Center $85,000 1991

Donation to Miles Square Health Center United Center $75,000 1991

Stadium jobs for local residents (assumed—no United Center N/A 1991 official record)

James Jordan Center/Boys and Girls Clubb Bulls $4,700,000 1994

United Center Economic Development Fund United Center $1,000,000 1995

Rodman fund (donation of money collected from Bulls $104,878 1996 fine of Dennis Rodman)

Additional donation to Malcolm X College for United Center $1,600,000 1996 expansion of scholarship program and upgrading of athletic programsc

Upgrade to computers at Mabel Manning Library Bulls $50,000 1998

Donation to Chicago Housing Authority to fund Bulls $1,000,000 1999 Home Visitors Program (overseen by Gates)

Contributions (in-kind and monetary) to adopt-a- Bulls N/A N/A school program (William H. Brown Elementary and Victor Herbert Elementary)

Founding grant for Noble Street charter campus Bulls $2,005,000 2009 (Bulls College Prep) Sources: “Area Briefs,” Chicago Sun-Times, April 25, 1996, NewsBank; Burney Simpson, “City Plots New West Side Story,” Chicago Reporter, December 1996; “Charitabulls,” The Sports Philanthropy Project, accessed May 13, 2013, http://www.sportsphilanthropy.com/content/index.php?pid=350; John Barron, “United Center Area Gets $1 Million Boost,” Chicago Sun-Times, February 2, 1995, NewsBank; John Handley, “In Play: West Side Story Getting Positive Rewrite with Help of New Stadium,” Chicago Tribune, July 24, 1994, ProQuest; Sean Terry, “Planning Strategy for the United Center: A Redevelopment Plan for the United Center and Its Surrounding Surface Parking Lots” (master’s thesis, University of Illinois Chicago, 2006), 3-4.

231

a Dollar values not adjusted for inflation (assumed that values are in current dollars of year reported). All figures reflect the highest estimates encountered by author. b The money for the construction of the Boys and Girls Club came from a tax-exempt bond issue by the Charitabulls, the 501(c)(3) charity arm of the Bulls, in August 1995. This means that rather than paying for the facility out of pocket, Reinsdorf executed a bond issue through his non-profit, and the bondholders paid no federal income tax on dividends (non-profits, like municipal entities, can make these issues on the grounds that they perform some sort of public service). In other words, Reinsdorf actually paid for the Boys and Girls Club with borrowed money at below- market interest rates. This effectively allowed him to fund the project without having to re- allocate any of his own assets, many of which were no doubt accruing interest at market rates. Internal Revenue Service, “Charitabulls” IRS Form 990, EID: 36|3544506, 2007, obtained via Freedom of Information Act Request, June 19, 2013. c The money transferred to Malcolm X did not consist of donations, but rather of payments in exchange for the right to use the college’s north parking lot for overflow parking on game nights. Greg Hinz, “Malcolm X’s Comeback,” Crain’s Chicago Business, September 20, 1997, ProQuest; Chicago City Junior College District v. The Department of Revenue of the State of Illinois, State of Illinois Department of Revenue, Office of Administrative Hearings, Chicago, Il, No. 10-PT-0014 (08-16-768), 2008 tax year.

The second justification offered for hailing the United Center as exceptional had to do with its alleged role in encouraging public investment in West Haven and other nearby neighborhoods. Most important, according to the project’s advocates, was the impetus created by the arena for infrastructural investment by the city and state. The city chipped in over $13.1 million for infrastructural improvements (esp. for upgrading nearby street segments) around the stadium, and the city and state would later devote over $30 million for additional neighborhood beautification, demolition, and street improvements in preparation for the 1996 Democratic National Convention (Table 4.2).

City officials also successfully convinced federal agencies like HUD that the United

Center offered an ideal node around which to invest Community Development Block

Grant monies, and secured several multi-million-dollar grants for additional infrastructural improvements and financing of community development efforts. This supplementary investment excited local boosters because it exemplified how the city could combine “small scale physical improvements” with privately funded “anchor”

232

projects to fill the void left by reduced federal funding for neighborhood revitalization.14

As a promotional packet from Chicago’s campaign to host the 1996 DNC told readers,

“we’re a city that works together forging public/private partnerships to maximize our civic resources.”15

14 Bennett, Third City, 100.

15 “Chicago 96” (promotional materials for Chicago’s campaign to host 1996 Democratic National Convention, Committee for ‘96, 1994), Municipal Reference Collection, Chicago Public Library. 233

Table 4.2. Public Investment in Support of United Center. Investmenta Source Amountb Year Reported United Center Infrastructure (street City of Chicago $13,100,000 1991 improvements, etc).

Renovations at Touhy-Herbert Park City of Chicago $600,000 1991

Construction of Mabel Manning Public Library City of Chicago $3,200,000 1991 Branch

Strategic Neighborhood Action Program Funds Department of $2,100,000 c. 1992 (for demolition, infrastructure, low-interest Housing and Urban financing) Development

New Homes for Chicago City of Chicago n/a n/a

Infrastructure improvements in support of City of Chicago, $36,300,000 1994-1996 Democratic National Convention State of Illinois

Other Community Development Block Grants Department of $5,000,000 1995 (CDBGs) for infrastructure, housing, and job Housing and Urban creation Development Sources: Cheryl Ririe-Kurz, “West Side Story,” Chicago Sun-Times August 6, 1995, NewsBank; Jill Schachner Chanen, “A Gritty Part of Chicago Gets a New Sparkle,” New York Times, April 20, 1997, ProQuest; Patrick Reardon, “Stadium Agreement Has a Winning Look,” Chicago Tribune, May 10, 1991, ProQuest; “Mabel Manning Branch Library,” Ross Barney Architects, Inc., accessed May 13, 2013, http://www.r- barc.com/places/?name=Mabel+Manning+Branch+Library; Scott Fornek and Fran Spielman, “Un- Conventional Facelift,” Chicago Sun-Times, May 27, 1996, NewsBank. a Those familiar with urban redevelopment in Chicago during the nineties will notice that Table 4.2 does not include money channeled by the federal government to the city’s Empowerment Zone program. Empowerment Zone (EZ) programs provided tax incentives for private investment in poor neighborhoods, and parts of Chicago’s west side received EZ designation. While a small part of this EZ area overlapped with West Haven, there is no indication in the program’s annual reports that the neighborhood benefited from any investment as a result of the program. See U.S. Department of Housing and Urban Development, “Search RC/EZ/EC Plans and Reports,” Homes and Communities, accessed May 13, 2013, http://www5.hud.gov/urban/perms/; City of Chicago Department of Planning and Development, “Empowerment Zone Program,” Programs and Services, accessed March 13, 2013, http://www.channelingreality.com/SBA_Corruption/Chicago_Empowerment_Zone_Program.pdf. b Dollar values not adjusted for inflation (assumed that values are in current dollars of year reported). All figures reflect the highest estimates encountered by author.

The third line of reasoning concerned the arena’s supposed re-branding of the neighborhoods in the northern half of the Near West Side as hip, attractive places to live and do business. By 1996, city officials were already talking of a “business and housing boom sparked by the 1994 opening of the United Center,” and a few years later the

Tribune emphasized the arena’s role as “the cornerstone of a Near West Side reborn as an

234

attractive place for people of all incomes to live.”16 Indeed, new home purchases in West

Haven increased significantly during the late 1990s.17 Moreover, during the nineties, the

number of households in West Haven earning at least $50,000 went from 207 to 1,063 (a

considerably faster rate than in Chicago as a whole).18 In 2001, the neighborhood

experienced its first major injection of private retail investment when a Walgreens drug

store opened at the intersection of Western and Madison.19 The consensus seemed to be

that these trends owed much to the new image brought to the neighborhood by the United

Center. In 1994 Earnest Gates told a reporter, “people are looking at the community

differently [after the United Center deal],” and a few years later he reiterated, “the change

has been light-years. You’ll see no graffiti in this neighborhood now.”20

The final logic touted by United Center boosters followed from the first three. The

pro-arena coalition claimed that the combination of community investment and re-

imaging of the neighborhood meant that the arena had emerged as the anchor of a

“balanced mixed-income community that welcomes new residents without displacing

those already in the neighborhood.”21 As Gates explained a few years after the arena

16 Scott Fornek, “Near West Side,” Chicago Sun-Times, December 30, 1996, NewsBank; Grossman and McRoberts, “Near West Side Rebounds like its Bullish Neighbors.”

17 Local Initiatives Support Corporation (Metroedge), Westhaven Market Study.

18 Local Initiatives Support Corporation (Metroedge), West Haven Information Profile (Chicago, IL: Near West Chamber of Commerce, May 2010), accessed May 13, 2013, http://www.nearwestchamber.org/uploads/nwschamber/documents/west_haven_lme_may2010_3.pdf, 17. This statistic refers to the area bounded by Kinzie Street to the north, the Eisenhower Expressway to the south, Rockwell Street to the west, and Ashland Avenue to the east.

19 Near West Side Community Development Corporation and Local Initiatives Support Corporation, More than Bricks and Mortar, 17.

20 Handley, “In Play”; David Broder, “Look What Happened to the Neighborhood,” Chicago Tribune, April 23, 1997, ProQuest.

21 Near West Side Community Development Corporation and Local Initiatives Support Corporation, More than Bricks and Mortar, 2. 235

opened, “had it not been for the United Center…the indigenous community could have

been priced out of the neighborhood.”22 In subsequent years, this narrative of “balance”

continued unabated. A report co-published by the NWSCDC and one of its non-profit

development partners in 2002 described the collective “vision” of the neighborhood:

“West Haven will become a vibrant mixed-income community that offers opportunities

for public housing residents and other long-time community members as well as

newcomers.” It went on to champion “strong support systems for the existing low-income population,” as well as to recommend that “subsidy programs stay in place to avoid displacement of long-time residents.”23

The notion of exceptional “balance” within West Haven also made its way into academic narratives. Alexander von Hoffman contrasts the recent urban history of the community around the United Center with neighborhoods like the Near South Side, where gentrification proved more “unmistakable” over the course of the 1990s. In his telling, West Haven was exceptional because its leaders skillfully navigated a “central problem” of neighborhood development in the late-twentieth-century American city:

“improving a low-income neighborhood but not allowing a wholesale replacement of the

population by high-income groups.”24 Von Hoffman presents some basic census figures

(aggregated at the community area scale) that seem to support such a perspective. Table

4.3, which consists of statistics taken straight from von Hoffman, shows that while the percentage of the total population made up of whites, median income, and educational

22 Grossman and McRoberts, “Near West Side Rebounds.”

23 Near West Side Community Development Corporation and Local Initiatives Support Corporation, More than Bricks and Mortar, 2.

24 Von Hoffman, House by House, 137, 158. 236

attainment all rose significantly in the Near West Side, the jumps proved far less dramatic than in other community areas close to the Loop like the Near South Side. Von Hoffman does not discuss the numbers in detail, but they imply that the neighborhood around the

United Center (the only part of the Near West Side he discusses) avoided the sort of across-the-board gentrification that overwhelmed other neighborhoods in the path of the

Loop’s expansion.

Table 4.3. Selected statistics from von Hoffman’s House by House, Block by Block. ___Near South Side______Near West Side___ 1990 2000 1990 2000 Total population 6,828 9,509 46,197 46,419

Percent White 5.4 25.2 18.8 25.3

Percent Black 93.6 64.4 66.8 53.3

Percent below 61.0 32.3 51.1 37.5 Poverty level

Avg. family $19,822 $70,835 $32,242 $56,325 income (1999 $)

Percent with 27.7 62.7 35.1 52.0 some college

Percent housing 7.0 16.0 23.6 15.1 units vacant Source: Adapted from von Hoffman (2004).

On the whole, boosters appeared to have the facts on their side. Reinsdorf and

Wirtz certainly poured a significant amount of money and resources into West Haven, the construction of the arena and the 1996 DNC definitely brought millions in supplementary investment from the city and state, and by the end of the 1990s the popular reputation of

West Haven and nearby neighborhoods had no doubt changed for the better. But just as these facts diverted attention away from the political struggle waged by Horner residents during the nineties, they also distorted the spatial histories taking shape around the arena.

237

In fact, neighborhood change in close proximity to the United Center proved anything but

“balanced,” and the arena’s role in sparking ancillary investment proved much less straightforward than its proponents supposed.

The “Catch-23” of “Balanced” Redevelopment

While the history of Horner residents’ struggle betrays the hollowness of the

“balance” championed by United Center boosters, it says little about whether or not what took shape around the arena actually resembled a neighborhood where longtime residents could enjoy stability alongside new, middle-class arrivals. After all, many public housing residents stayed put by virtue of the Horner consent decree; so one might assume that

“mixed-income” and “balance” accurately described West Haven. Unfortunately for many of those who had suffered through years of decline, the reality on the ground proved very different.

Evidence of displacement of poor people from the blocks around the arena appeared—albeit in bits and pieces—in the local papers a few years after the United

Center opened. In 1998, the Sun-Times quietly reported that schools in the Near West

Side had lost “nearly 2,500 students, mostly African-Americans, since 1991,” and attributed the loss to attrition at many of the struggling public schools in the immediate vicinity of the United Center and Horner.25 Two years earlier, the Tribune had identified the Near West Side as one of several community areas in close proximity to the Loop where “countless residents fall into the cracks of the housing system…mak[ing] too much

25 Rosalind Rossi and Jon Schmid, “Chicago Schools Add More Latinos, Asians,” Chicago Sun-Times, January 4, 1998, NewsBank. 238

money to live in Chicago Housing Authority facilities, but not enough to qualify for

subsidized home ownership programs.”26

These alarming, though admittedly vague reports seemed at odds with the

“balance” thesis, and with the notion promulgated by arena boosters and the NWSCDC

that the formula for successful neighborhood development around the United Center

involved adding new residents next to people who lived in the community prior to 1991,

as opposed to displacing the latter. Moreover, reports prepared by the NWSCDC and

their development partners never provided actual statistics to support the assertion that

sports-linked development created stability for longtime residents. Instead, most of the

demographic numbers in the publications dealt with the influx of new middle-class residents. The data offered by von Hoffman (Table 4.3) includes more variables, but ultimately means very little since it tracks change in the Near West Side as a whole. This is too small a scale for describing changes in West Haven since, as Chapter Three emphasizes, the Near West Side contained many distinct neighborhoods.27 Using data aggregated for the entire community area risks muddling variation between the demographic history of West Haven and that of adjacent neighborhoods.

Indeed, zooming in on change in West Haven provides a much better picture of the processes that played out around the arena. Geographic Information Systems (GIS) software makes this possible by linking data from the U.S. Census to digital boundary files at multiple scales (e.g. census block, census tract, city, etc.). For urban historians

26 Evan Osnos, “West Town’s Revival not Without a Price,” Chicago Tribune, July 12, 1996, ProQuest.

27 On theoretical and methodological considerations concerning neighborhood definition and the problem of scale, see John Logan, Weiwei Zhang, and Hongwei Xu, “Applying Spatial Thinking in Social Science Research,” GeoJournal 75, no. 1 (February 2010): 15-27; John Logan, “Making a Place for Space: Spatial Thinking in Social Science,” Annual Review of Sociology 38 (2012): 507-524; Seth Spielman and John Logan, “Using High-Resolution Population Data to Identify Neighborhoods and Establish Their Boundaries,” Annals of the Association of American Geographers (published online June 2012). 239

interested in neighborhood analysis, using GIS can be tricky, since census block and

track boundaries have shifted repeatedly over the course of the twentieth century. If a

historian defines a “neighborhood” as a set of tracts as drawn in one census year, it

becomes very difficult to accurately gauge change over time within that original

neighborhood geography if the tract boundaries shrank or expanded in subsequent

decades.28 To help deal with this challenge, urban sociologists John Logan, Zengwang

Xu, and Brian Stults developed a “Longitudinal Tract Database” which standardizes census tract geography and data across years from 1970 to 2010.29 This data set allows

for more dependable comparisons of census data from different decades when working at

the scale of a neighborhood.

Map 4.1 shows the standardized census tract geography used throughout the rest

of this section to document the history of demographic change around the United Center.

The red polygon in the map contains the West Haven neighborhood as defined by the

Near West Side Community Development Corporation (see Map 3.6 for a larger scale

version of this area). I use this boundary, which extends two blocks west of the original

“Better Alternative Area” defined by the Interfaith Organizing Project (see Map 3.5), to

define the neighborhood around the United Center. This area represents the NWSCDC’s

primary area of operation after the break between Earnest Gates and the Interfaith

Organizing Project, and, by extension, the geography within which one should be able to

28 To visualize why this could pose a problem, imagine that two of the edge tracts in a “neighborhood” expand to include additional area from one census to another. The net population of the tracts in the first census was 1,500, and the net population of the tracts in the subsequent census was 2,000. We have no way of knowing whether or not the population gain resulted from existing residents in the new areas incorporated into the expanded tracts, or from an influx of new residents into the area covered by the old tract boundaries.

29 For more on the methodology used in constructing this dataset, see John Logan, Zengwang Xu, and Brian Stults, “Interpolating US Decennial Census Tract Data from as Early as 1970 to 2010: A Longitudinal Tract Database,” Professional Geographer (forthcoming). 240

detect the impacts of stadium-linked development, since the NWSCDC managed most of

the direct investment into the neighborhood by the team owners.30 As the map indicates,

the census tracts used to measure change in West Haven extend slightly beyond the

neighborhood boundary to the north and south), which at first glance suggests that they

are a poor proxy for measuring change within West Haven. However, the absolute

differences in demographic measures between the area within the red West Haven

boundary and the associated tracts are negligible. Map 4.2, which documents local land

use as of 1990, demonstrates why: the area within the tracts that extends beyond the red boundary to the north is exclusively industrial (i.e. there has been no residential population to speak of in recent history); and as of 1990 the area within the tracts extending beyond West Haven to the south contained two tiny, numerically insignificant pockets of residential population in the Tri-Taylor neighborhood.31

The last methodological point concerns the neighborhoods other than West Haven included in Map 4.1. East Garfield Park, physically demarcated from West Haven by rail lines, lies farther to the west. To this day, it remains a prototypically poor West Side neighborhood. It has experienced very little investment since the 1960s, and lacks any

30 West Haven is bounded by Kinzie Street to the North, the Eisenhower Expressway to the South, Rockwell Street to the West, and Damen Avenue to the East. This is the consensus definition among the following sources: Near West Side Community Development Corporation, “Community Directory,” Near West Side Community Development Corporation, accessed May 13, 2013, http://www.nearwestsidecdc.org/directory/index.html; Near West Side Community Development Corporation and Local Initiatives Support Corporation, More than Bricks and Mortar; Local Initiatives Support Corporation, West Haven: Rising Like the Phoenix.

31 See map 3.5 in the previous chapter for the geography of Tri-Taylor. As of 1990, the total population of these two pockets was 817 persons, 209 of which were black. Since the demographic analysis in this chapter focuses primarily on change in black population—in particular, black population decline— throughout West Haven, the relatively miniscule number of blacks in these pockets cannot exert a significant impact. These details come from the information used to construct Map 1.1.

241

sort of “anchor” development on the scale of the United Center.32 To the east of West

Haven, the West Loop and West Loop Gate offer examples of neighborhoods that gentrified rapidly during the eighties and nineties. I also include the Loop (further to the east) to provide a sense of concurrent change within the central business district, which continued to lure considerable investment during the decades in question. I zoom in on this narrow east-west corridor because: 1) it reduces visual clutter, and 2) it excludes nearby neighborhoods to the north and south separated from West Haven and the United

Center by major physical barriers like expressways and industrial corridors, and which, as a result, have relatively distinct development histories.33

32 As an illustration of the lack of investment in East Garfield Park, building permit data from the City of Chicago indicates for the years 1987 through 1990, there was no new construction in the entire community area. By contrast, the City issued a handful of permits for new construction in what was the Better Alternative Area. See City of Chicago Department of Planning and Development, Chicago Neighborhood Development: New Construction 1987-1990 (Chicago, IL, February 1992), 227-236, Municipal Reference Collection, Harold Washington Library Center.

33 Gentrification was unlikely to move into West Haven from the north or south because of physical barriers. The Kinzie industrial corridor (see Maps 3.5 and 4.2) separated West Haven from West Town to the north, and the Eisenhower Expressway (see map 3.5) created a significant barrier between West Haven and the Medical District to the south. Geographers Elvin Wyly and Daniel Hammel reported in 1998 that, “on the west side, gentrification extends outward from downtown along two corridors: one toward a large medical complex just west of Ashland Avenue and another toward the new United Center.” Elvin Wyly and Daniel Hammel, “Modeling the Context and Contingency of Gentrification,” Journal of Urban Affairs 20, no. 3 (October 1998), 308. 242

Map 4.1. Census Tract Geography in West Haven and Nearby Neighborhoods. Sources: Basemaps provided by Esri. Shapefiles obtained from City of Chicago, Chicago Data Portal; U.S. Census Bureau, American Factfinder.

243

Map 4.2. Land Use in West Haven as of 1990. Sources: Shapefiles obtained from Chicago Metropolitan Agency for Planning, (1990); U.S. Census Bureau, American Factfinder.

Mapping the recent history of racial composition in these neighborhoods suggests a very different picture than the one provided by von Hoffman and United Center boosters. Admittedly, changes in racial makeup do not tell us all we need to know when it comes to evaluating the degree to which a neighborhood like West Haven experienced gentrification. As geographers Elvin Wyly and Daniel Hammel point out, gentrification is

244

“fundamentally a class-based process” characterized by high-income residents displacing low-income ones, and urban scholars have documented instances of high-income people of color displacing poor residents of the same ethnoracial background. Nevertheless, dramatic changes in racial composition over short periods of time often provide strong evidence of displacement.34

Map Series 4.3 and 4.4 below show changes in racial composition in and around

West Haven since 1990 using two different census variables, and in both cases the

change appears less than dramatic. The percentage of the total population represented by

African-Americans (Map Series 4.3) clearly fell in West Haven: from 94% to 89% during

the 1990s, and down to 75% during the following decade. However, the 2010 figure

remained extremely high relative to the neighborhoods to the east (with numbers just

above 10%), and at three-quarters of the total population blacks remained an

overwhelming majority within West Haven. A clear racial gradient still existed along

Ashland Avenue twenty years after neighborhood residents struck a deal with the arena

developers. The number of whites moving into the neighborhood (Map Series 4.4)

increased steadily, but remained relatively modest over the same period. While whites

moved into the tracts around the United Center, they did so at a much slower rate than

into the West Loop and West Loop Gate, which together saw the number of white

residents jump by over 10,000 between 1990 and 2010. This all seems consonant with the

“balance” thesis forwarded by champions of stadium linked-development. New residents

were arriving in West Haven, but at a relatively slow pace. One might read the maps as

depicting the early signs of gentrification in West Haven, but one could just as easily

34 Wyly and Hammel, “Modeling the Context and Contingency of Gentrification,” 315. 245

assume that they reflect the influx of new residents alongside the existing African-

American population.

246

Map 4.3. (series). African-Americans as Percentage of Total population, 1990-2010. Sources: Basemaps provided by Esri. Shapefiles obtained from City of Chicago, Chicago Data Portal; U.S. Census Bureau, American Factfinder. Full-count census data obtained from Logan, Xu, and Stults, Longitudinal Tract Database.

247

Map 4.4. (series). Change in Absolute White (Non-Hispanic) Population, 1990-2010. Sources: Basemaps provided by Esri. Shapefiles obtained from City of Chicago, Chicago Data Portal; U.S. Census Bureau, American Factfinder. Full-count census data obtained from Logan, Xu, and Stults, Longitudinal Tract Database.

The latter interpretation becomes harder to sustain, however, after examining the

change in the absolute number of blacks in West Haven. As Map Series 4.5 indicates,

between 1990 and 2000, the neighborhood experienced a net loss of over 3,300 African-

248

Americans. This represented nearly a quarter of the black population in the tracts

surrounding the United Center! The decline continued apace in the next decade, as the

neighborhood experienced another net loss of over 3,000 blacks. During both of these

decades, the rate of decline in (and the absolute loss of) African-American residents in

West Haven exceeded the numbers for East Garfield Park, which had few if any spatial or

institutional linkages to the United Center. Moreover, these numbers almost certainly

underestimate the decline in black population from its pre-United Center levels; since

Earnest Gates and the NWSCDC marketed West Haven aggressively to middle-class

African-American homebuyers, it stands to reason that new blacks moving into the neighborhood around the same time actually offset some of the loss indicated by census figures.35 The maps make clear that during the nineties the black population actually

jumped dramatically within the neighborhoods to the east of the United Center, but the

fact that that these areas contained little in the way of subsidized housing stock means

that the African-Americans who relocated there consisted of new homebuyers and young

professionals from outside of West Haven.36 Put simply, the tracts around the arena were not in the midst of a stable, mixed-income revitalization. Rather, they were undergoing what urban development expert Sean Zielenbach describes as a “typical gentrification

35 Grant Pick, “The Importance of Being Earnest,” Crain’s Chicago Business, April 4, 1994, ProQuest.

36 Two points deserve mention about the spike in the number of blacks in the West Loop and the Loop. First, the increases, while significant—at least during the nineties—paled in comparison to the influx of whites. Second, the gains in the overall number of African-Americans plateaued or reversed in the next decade, likely as a result of rising real estate prices in the first half of the decade and the subsequent collapse of the housing market.

249

pattern” in 1990s Chicago, in which the city’s overwhelmingly black neighborhoods

“improved [but] continued to lose substantial portions of their population.”37

To be clear, these maps do not prove that the United Center caused, or even

accelerated, gentrification. The departure of African-Americans from the neighborhood

was already in full-swing by the 1980s. In fact, compared to the eighties, the decline in

the black population in West Haven appears to have slowed in subsequent decades (see

Map Series 4.5). Thus, another possible interpretation of this data is that the United

Center served a sort of “damage control” function that limited the deterioration of the

local African-American community. However, there are at least three reasons to reject

this interpretation. First, as already mentioned, the net population losses in West Haven

depicted on the maps underestimate the shrinkage of the longtime black population, since

the losses were likely offset by the arrival of new African-American homebuyers.38

Second, while the pace of black depopulation in East Garfield Park tapered off during both the 1990s and 2000s, the rate of decline in West Haven eased in the nineties but hardly budged during the 2000s. In theory, the alleged “anchor” effects of the arena should be more in evidence for the data from the 2000s, since by the end of the decade the arena had enjoyed over 15 years of highly profitable operation. Instead, the neighborhood around the United Center continued to suffer from more demographic instability than its impoverished neighbor to the west. Finally, there is every reason to believe that the magnitude of this instability would have been much more pronounced in

37 Sean Zielenbach, Understanding Community Change: A Look at Low-Income Chicago Neighborhoods in the 1990s (Washington, D.C.: Urban Institute, 2005), 1.

38 Notice, for example, that in the 1990s, some tracts within West Haven saw noticeable net gains of blacks despite sitting right next to tracts experiencing dramatic falloffs. The influx during the 2000s appears to have tapered off, likely as a result of the financial and foreclosure crises. 250

the absence of the legal protections won by residents at Horner—protections that owed nothing to the United Center.

251

Map 4.5. (series). Change in Absolute African-American Population, 1980-2010. Sources: Basemaps provided by Esri. Shapefiles obtained from City of Chicago, Chicago Data Portal; U.S. Census Bureau, American Factfinder. Full-count census data obtained from Logan, Xu, and Stults, Longitudinal Tract Database.

252

In order to understand this final point, one has to look closely at the fate of

Rockwell Gardens, the other major public housing project in West Haven. Rockwell

Gardens, which sat just a few blocks to the south and west of Horner’s western edge,

consisted of more than 1,100 units built by the Chicago Housing Authority during the

1960s (see Map 4.6). Like Horner, it suffered rapid deterioration in subsequent decades,

but by some notable measures it was in better shape than Horner in the early nineties. For

example, in 1991 its vacancy rate stood at 12.5 percent, more than 30 percentage points

below the rate at Horner.39 While Rockwell sat just outside the western edge of the

original Better Alternative Area, Gates and the NWSCDC incorporated it into the

organization’s area of operations after the break with Daniels and the IOP.40 Moreover,

given the fact that rail lines to the west formed a de facto barrier between the housing

project and East Garfield Park, Rockwell melded more seamlessly into the neighborhood

around the United Center.

The census data presented in Map 4.6 shows that the number of blacks living in

the tract containing Rockwell fell by more than 2,400 during the 1990s. This was, by far,

the hardest hit tract within West Haven in terms of African-American depopulation. In

fact, the census numbers actually underestimate the severity of the outflow from

Rockwell. According to CHA records, the number of public-housing residents at the project—almost all of whom were black—plummeted from 4,033 in 1991 to 1,265 in

39 Chicago Housing Authority, Statistical Profile: 1991 to 1992 (Chicago, IL, n.d.), Municipal Reference Collection, Harold Washington Library Center; Bowly, Jr., The Poorhouse, 121.

40 Near West Side Community Development Corporation, “Community Directory.” For other evidence that Gates and the NWSCDC considered Rockwell as part of the neighborhood, see Grant Pick, “Turf War,” Chicago Reader, July 9, 1998, http://www.chicagoreader.com/chicago/turf-war/Content?oid=896776; Near West Side Community Development Corporation and Local Initiatives Support Corporation, A Quality of Life Plan. 253

2001 (Table 4.4).41 The reasons behind this exodus mirrored those in Chicago’s other

public housing developments: the seemingly unstoppable momentum of decades of

divestment from the surrounding neighborhood (the United Center notwithstanding),

negligence by the CHA, and unchecked gang activity. Rockwell’s instability persisted

into the next century. Beginning in 2003, the CHA began to demolish the project as part

of the city’s Plan for Transformation, which used HOPE VI funds to replace public

housing with “mixed-income” developments. By 2008, only 232 public housing residents

remained at the redeveloped site. This amounted to less than five percent of Rockwell’s

1980 population.42

41 The larger loss indicated by the CHA numbers likely has to do either with the influx of new residents into non-CHA residential structures in the tract during the 1990s or with challenges associated with establishing a complete census count in very-low-income areas.

42 This coincided with a decline in units designated for public housing residents from 1,136 to 71. For more on the numbers, see Micah Maidenberg, “The Rockwell Review,” Chicago Journal, April 29, 2009, accessed May 13, 2013, http://www.chicagojournal.com/News/In-The-Paper/04-29- 2009/The_Rockwell_review. 254

Map 4.6. Change in Absolute African-American Population, West Haven Tracts, 1990-2000. Sources: Basemaps provided by Esri. Shapefiles obtained from City of Chicago, Chicago Data Portal; U.S. Census Bureau, American Factfinder. Full-count census data obtained from Logan, Xu, and Stults, Longitudinal Tract Database.

Table 4.4. Number of Public Housing Residents at CHA Developments in West Haven. Henry Horner Rockwell Gardens Year (West Haven) (Jackson Square/West End) 1980 7,765 5,274 1991 3,057 4,033 2001 2,137 1,265 2008 1,847 232 Sources: Chicago Housing Authority, Statistical Profile: 1991 to 1992; Chicago Housing Authority, Moving to Work (MTW) Annual Plan, (2002 and 2009).

Unfortunately, this was the norm when it came to the “redevelopment” of public housing under the Plan for Transformation. In order to make the new developments

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attractive to market-rate buyers, the CHA designated only a tiny number of mixed-

income units for very low-income public housing residents. The vast majority of

residents, after receiving notice that their units would be demolished, received “housing

choice vouchers” to use in the private rental market, and were assured by the CHA that

they would eventually have the opportunity to exercise their “right of return” to mixed-

income developments. However, as the Chicago Reporter documented during the mid-

2000s, only a tiny fraction of residents actually made their way back to the new

developments. While demolition happened at a breakneck pace during the late nineties

and 2000s, construction of new mixed-income units lagged far behind. Persistent budget

shortfalls and an insistence on strict caps on the number of low-income residents by both

the CHA and the private developers contracted to construct the mixed-income

developments meant that only a handful of the families forced to accept “temporary”

vouchers would actually realize their right of return. The suspension in 1996 of a federal

law mandating that local housing authorities replace every demolished unit with a new

one effectively allowed the CHA to exclude thousands of residents from new

developments.43 Moreover, increasingly tough restrictions on qualifying for new public

housing units disqualified scores of families, often for petty transgressions like late utility

bills.44

43 Patricia Wright, “Community Resistance to CHA Transformation,” in Where Are Poor People to Live?: Transforming Public Housing Communities, ed. Larry Bennett, Janet Smith, and Patricia Wright (Armonk, NY: M.E. Sharpe, 2006), 126.

44 Casey Sanchez, “Just Moving On: After Years of Waiting and Struggling to Meet New Requirements, Thousands of CHA Residents May not Return to New Mixed-Income Housing,” Chicago Reporter, May/Jun 2006, accessed May 13, 2013, http://www.thefreelibrary.com/Just+moving+on%3A+after+years+of+waiting+and+struggling+to+meet+n ew...-a0148319656. For more on problems surrounding right of return in Chicago, see Bennett, Smith, and Wright, eds., Where Are Poor People to Live? For an illuminating discussion of these issues outside of 256

The consent decree secured by Horner residents shielded them from many of the

uncertainties surrounding the right of return. In particular, it mandated that the CHA

could not demolish units until replacement units were completed, and guaranteed more

humane qualification requirements in terms of work status and criminal background.

While it’s true that many Horner residents also left the neighborhood, the statistics in

Table 4.4 suggest that these losses would have been much more severe had

redevelopment at Horner followed the trajectory at Rockwell, where displaced residents

had little chance of returning. Between 1991 and 2008, the number of residents living at

Horner dropped from 3,057 to 1,847 (a decline of about 40 percent). Over the same

period, Rockwell’s population plummeted from 4,033 to 232 (a decline of well over 90

percent). While Horner was not immune to demographic instability, the consent decree

provided it with a meaningful defense against the type of displacement occurring at other

projects in Chicago, and allowed more residents to take part in the redevelopment process

allegedly sparked by the United Center than would have otherwise been the case.45 Local housing advocates like Ed Shurna corroborate this interpretation. Shurna believes that

“keeping public housing there [in West Haven] was integral to maintaining it as probably a more African-American area than any other area that’s quite that close to the city.”46

Chicago, see John Arena, Driven From New Orleans: How Nonprofits Betray Public Housing and Promote Privatization (Minneapolis: University of Minnesota Press, 2012).

45 To put this in broader perspective, by the end of 2010, 44 percent of Chicago’s subsidized housing population relied on vouchers (i.e. had to secure housing in the private market). Among those living at the Horner site in 1999 who still remained in the subsidized system, only 14 percent had left West Haven with vouchers. For the numbers, see Chicago Housing Authority, The Plan for Transformation: An Update on Relocation (Chicago, IL, April 2011), accessed May 13, 2013, http://www.thecha.org/pages/plans__reports___policies/40.php, 3, 18.

46 Ed Shurna, interview by author, August 15, 2011, transcript available from author upon request. 257

To reiterate, none of this proves that the United Center caused residents to leave

West Haven. What it does prove—unequivocally—is that the arena was far from the miracle anchor development that its proponents made it out to be. As boosters spoke of a

“balance…that supports newcomers, but not at the expense of existing residents,” those existing residents were leaving the community in droves.47 It was either shortsighted or

dubious on the part of arena ownership, city officials, and local organizations like the

NWSCDC to believe that a new basketball arena would salvage a neighborhood plagued

by what one local activist described as a “long evolutionary process of disinvestment,” as

well as by a growing assault from local and federal housing authorities.48 The tens of

millions in direct and indirect community investment linked to the United Center (see

Tables 4.1 and 4.2) was a drop in the bucket relative to the resources needed to

resuscitate the neighborhood and provide the social supports necessary to keep longtime residents in place.

That these resources were not forthcoming from the government was a matter of priority, not of fiscal capacity. As mentioned in Chapter One, Costas Spirou estimates that Chicago spent $7 billion from 1989 to 2003 on public infrastructure along a “four-

mile lakefront stretch” in and around the Loop—an area that needed little extramarket

assistance in luring investment.49 In this context, the United Center did not represent the

47 Near West Side Community Development Corporation and Local Initiatives Support Corporation, More than Bricks and Mortar, 13.

48 Vernon Ford, A Draft Commentary on the Proposed Westside Stadium Site and Issues Faced by Local Community Residents, City Administration, the Private Development Sector and the Black Middle Class, (report submitted by mail to Robert Mier, June 4, 1987), Box 17, Folder 5, Robert Mier Papers, Chicago History Museum.

49 Costas Spirou, Urban Tourism and Urban Change: Cities in a Global Economy (New York, NY: Routledge, 2011), 106. According to Spirou, the total invested by the city in public infrastructure during this period was $11 billion. 258

private sector’s ability to revitalize communities where state-directed redevelopment efforts had failed. Instead, it represented the private sector parading as a “free-market” fix for a neighborhood in crisis as public officials poured taxpayer money into Chicago’s richest neighborhoods. The biggest irony in this regard was that the Horner consent decree resulted in more direct neighborhood investment than the United Center. The two- phase redevelopment of Horner forced local and federal housing authorities to pony up approximately $250 million, an amount that dwarfed the total amount of funds provided for neighborhood revitalization by arena ownership (see Tables 4.1 and 4.2).50 Moreover, money devoted to new public housing units went directly towards enhancing neighborhood use values for longtime, low-income residents, whereas much of the stadium-linked investment did not.

There is more to this story, however, than the inability of a new professional sports facility to rejuvenate a decimated community for the benefit of those yet to leave.

By way of the NWSCDC’s development efforts, money from United Center ownership almost certainly exacerbated the pressures that forced the departure of many low-income

African-Americans. In particular, the dedication of much of this money to

“homeownership growth” meant fewer housing options for low-income residents.51

During the 1990s, Gates and NWSCDC focused on the development of “affordable” for-

sale properties, but at upwards of $150,000 these units remained well beyond the reach of

most of the neighborhood’s longtime residents.52 To make matters worse, the fixation on

50 Wilen, “The Horner Model.” Here, I don’t include the construction costs of the arena itself as “direct” neighborhood investment. As Chapter Two shows, the arena was not an asset accessible to most local residents, and there is no evidence that it provided significant employment benefits for neighborhood residents.

51 Local Initiatives Support Corporation (Metroedge), Westhaven Market Study, 26.

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homeownership had, according to a 1997 Sun-Times report, depressed vacancy rates and increased prices in the rental market in community areas like the Near West Side.53

Residents in West Haven who failed to qualify either for a mortgage or for public

housing found themselves caught in a no-person’s-land when it came to finding

affordable shelter, and many in this situation no doubt packed up and left.

As the city took the wrecking ball to subsidized housing units at Rockwell

Gardens, the fact that most non- and for-profit development around the United Center

catered to potential homebuyers meant that displaced public housing residents also had

few if any alternative housing options in the neighborhood. Especially for “hard-to-

house” residents like grandparents caring for grandchildren, victims of domestic violence,

and individuals with limited work histories, the neighborhood went from “troubled,”

offering “stable, if less than ideal, housing,” to a community that offered no viable

housing options.54 Indeed, as official CHA records show, many of those forced to leave

Rockwell with vouchers relocated to poor, segregated neighborhoods on the western

fringe of the city, far removed from the redevelopment processes underway in West

Haven.55

For former Rockwell residents and others who fell outside the protections of the

Horner consent decree, West Haven emerged as a microcosm of late twentieth-century

“redevelopment” in urban America. We know from an expanding literature on the fate of

52 Gates, interview by author.

53 Bill Rumbler, “Loft Rentals Are Hard to Find Near the Loop,” Chicago Sun-Times, March 23, 1997, NewsBank.

54 Susan Popkin, Mary K. Cunningham, and Martha Burt, “Public Housing Transformation and the ‘Hard to House’,” Housing Policy Debate 16, no. 1 (2005): 9.

55 Chicago Housing Authority, The Plan for Transformation, 23. 260

public housing residents relocated with vouchers during the 1990s that, while many of

them found rental units in areas with lower relative poverty rates, many others did not.

Urban geographers have demonstrated that in Chicago, “poverty is highly concentrated in

the neighborhoods chosen by most voucher recipients,” and that “voucher users in

Chicago are moving away from the central city.”56 To make matters worse, national data

indicate that “even among those who have moved to new neighborhoods, a substantial

proportion are struggling to meet basic needs [like rent] that previously were covered in

public housing.”57

This is not to say that decision-makers in West Haven like Reinsdorf and Gates orchestrated some master plan to spur gentrification. They did, however, provide the money and manpower for implementation–at the neighborhood level–of national policy interventions that shunted aside low-income residents to make way for a new round of private real estate development in central cities. Nothing exemplified this more than the aforementioned obsession with homeownership. During the 1990s, the Clinton administration redirected federal housing resources away from supporting very low- income residents, and towards increasing working- and middle-class ownership. The idea behind this new urban policy was that increased homeownership in depressed neighborhoods would “enhance community stability and revitalization, while allowing

56 Todd Sink and Brian Ceh, “Relocation of Urban Poor in Chicago: HOPE VI Policy Outcomes,” Geoforum 42, no. 1 (January 2011): 71, 81. For more on housing voucher relocation outcomes, see The Robert Taylor Homes Relocation Study, research report (New York, NY: Center for Urban Research and Policy, Columbia University, September 2002); G. Thomas Kingsley, Jennifer Johnson, and Kathryn Pettit, “Patterns of Section 8 Relocation in the HOPE VI Program,” Journal of Urban Affairs 25, no. 4 (2003): 427-447; Deirdre Oakley and Keri Burchfield, “Out of the Projects, Still in the Hood: The Spatial Constraints on Public-Housing Residents’ Relocation in Chicago,” Journal of Urban Affairs 31, no. 5 (December 2009): 589-614.

57 Susan Popkin, The HOPE VI Program—What About the Residents, (Washington, D.C.: Urban Institute, 2002), accessed May 13, 2013, http://www.urban.org/uploadedpdf/310593_HopeVI.pdf, 1. 261

individual homeowners to accumulate wealth in return for work, savings, and other

commitments of ‘personal responsibility.’ ”58 A patchwork of policies and initiatives like the 1992 Federal Housing Enterprises Financial Safety Act and the 1995 launch of the

National Homeownership Strategy—not to mention looser regulations regarding who could and couldn’t get home loans—drove a 31 percent jump in mortgage originations in low-income neighborhoods between 1993 and 1997.59 But while these policies placed

new assets in the hands of many who had previously fallen just short of qualifying for a

mortgage, they did so at the expense of low-income residents with no chance of

competing in the private real estate market.

The contrast between the exodus of longtime African-American residents

documented above and the influx of new homeowners during the late nineties and early

2000s could not have been starker. As shown in Figure 4.1, new home purchases in West

Haven began to tick upwards—albeit fitfully—in the late nineties, and exploded in the

first half of the 2000s. As low-income blacks left, new homebuyers flooded in. Earnest

Gates and the NWSCDC seemed more than happy with the situation. A report co-

authored by the NWSCDC in 2007 bragged, “the number of upper middle income

households—a key demographic needed to support retail development—has nearly

tripled in the last fifteen years.”60

No wonder residents at Horner told the New York Times during the 1996

Democratic National Convention that they were “worried that they [would] be priced out

58 Elvin Wyly et al., “Low- to Moderate-Income Lending in Context: Progress Report on the Neighborhood Impacts of Homeownership Policy,” Housing Policy Debate 12, no. 1 (2001): 87.

59 Wyly, Cooke, Hammel, Holloway, and Hudson, “”Low- to Moderate-Income Lending in Context,” 88- 91.

60 Local Initiatives Support Corporation (Metroedge), Westhaven Market Study, 12. 262

just when the neighborhood is making a comeback and the Democrats are two streets

away promising a better America for everyone ‘but us.’ ” Rubin McClellan, one of those

residents, articulated what was no doubt on the minds of many of his neighbors when he

said, “before Michael Jordan came along and built that stadium over there, the city never

thought about us…Now, they want to chase the black man out of here.”61 For some, the

cynicism endured. In the summer of 1998, a journalist from the Tribune paraphrased

another resident with misgivings about stadium-linked development: “As he figures it, within 10 years the Horner high-rises will be parking lots for the condos of white urban professionals…‘That’s the Catch-23,’ he said, mixing Michael Jordan’s jersey number with Joseph Heller’s classic novel.”62 Ironically, many at Horner fared relatively well

given the consent decree, but the residents’ cynicism was more than vindicated by the

broader trajectory of redevelopment around the arena.

61 Don Terry, “Convention Gives Nearby Residents a Few Days of Safety,” New York Times, August 30, 1996, LexisNexis. Keep in mind that, while the consent decree had already been issued, at this point in time many residents still did not know whether or not it would be honored in practice.

62 Grossman and McRoberts, “Near West Side Rebounds Like Its Bullish Neighbors.” 263

160

140

120

100

80

60

40 Number of New Purchase Loans Purchase New of Number

20

0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Year

Figure 4.1. New Home Purchase Loans in West Haven, 1995-2005.a Source: Local Initiatives Support Corporation (MetroEDGE) (2007). a Figures for area bounded by Kinzie Street to the north, Eisenhower Expressway to the south, Rockwell Street to the west, and Damen Avenue to the east.

The tragedy of the situation faced by poor people living around the United Center

who fell outside the protections of the Horner consent decree is best summed up by Larry

Bennett, Nancy Hudspeth, and Patricia Wright in an analysis of public housing

redevelopment during the late 1990s and 2000s. They note that, especially in

neighborhoods near the Loop, scores of very low-income residents had to leave their

homes and communities “just at the point when new private investment and, very likely

as well, ancillary public investment in infrastructure and schools promise[d] to greatly

improve both economic opportunity within the neighborhood and the local quality of

life.”63 In West Haven, advocates of stadium-linked development constantly reaffirmed a

63 Bennett, Hudspeth, and Wright, “A Critical Analysis,” 201. 264

commitment to “the delicate balancing act [of] welcoming our incoming residents…while

at the same time ensuring that those who have lived in West Haven for decades are not

chased out.”64 In practice, stadium-linked development did a much better job of finding a

place for new homeowners, and in doing so encouraged the displacement of thousands of

longtime residents who had to watch from a distance as construction crews went to work

on their old neighborhood.

A Chronological Sleight of Hand?

Whether or not the odes to “balance” misrepresented the nature of neighborhood

change in West Haven had little bearing on the broader argument made by local boosters

that the arena spurred a wave of new investment in the Near West Side. The Chicago

media repeatedly rejoiced that, as the Sun-Times put it in 1996, “in the Near West Side neighborhood, the building of the United Center seemingly has sparked a housing rebirth.”65 A few months later, the Tribune got in on the act, noting that “loft

developments are sprouting from the Eisenhower Expressway to Fulton Street,” and

adding that, “without question, the United Center has spurred development in the area.”66

The media simply assumed that the United Center fostered all the new development.

And why not? The fact that new residential structures and restaurants were popping up in

close proximity seemed like more than enough proof that the arena had set in motion the

economic recovery of the northern half of the Near West Side.

64 Local Initiatives Support Corporation, West Haven: Rising Like the Phoenix, 16.

65 Bill Rumbler, “City Values Climb Across the Board,” Chicago Sun-Times, June 23, 1996, NewsBank.

66 Ellen Rooney Martin, “Bouncing Back: Businesses and Developers Bring a Gritty Community Back to Life,” Chicago Tribune, August 24, 1996, ProQuest. 265

Not everyone was convinced, however. Larry Bennett, an urban planner at DePaul

University, questioned whether or not the change in the area had much at all to do with

the United Center. Over a decade after the arena opened, Bennett summarized his

suspicions in an interview with the Sun-Times. He conceded that “there’s been

redevelopment to the west of the stadium, lofts have been built to the east and restaurants

have sprouted up on Randolph.” But, reversing the popular logic, he added, “I think a lot

of that occurred without the United Center influence. It could well be that the United

Center has benefited more from the neighborhood flux.”67 A few years later, fellow urban

planner Rachel Weber expressed a similar view, suggesting in an interview that nearby

development “happened in spite of the United Center…not necessarily because of the

United Center.”68

Most readers probably dismissed the reversal of conventional wisdom attempted

by Bennett and Weber. Were people really supposed to believe that the United Center’s

relationship to the economic rebirth of the northern half of the Near West Side was more

coincidence than cause? Interestingly, the interpretation of Bennett and Weber echoed

one of the main arguments against stadium-linked development made by the Interfaith

Organizing Project during the late eighties. During its struggle against the Bears, the

group had repeatedly made the point that new private investment in West Haven (then the

Better Alternative Area) was imminent, with or without a stadium. As IOP president

Arthur Griffin told reporters in the spring of 1987, “the neighborhood is so well-situated, close to the Loop and transportation lines, that it is bound to come back, even without a

67 Kirsten Miller, “Olympic Opportunity?: Real Estate Interests Assess Washington Park,” Chicago Sun- Times, January 5, 2007, NewsBank.

68 Boyer, “Urban Planning Folly.” 266

stadium.”69 With this in mind, the IOP insisted that the city rebuff the Bears and refocus

its efforts on helping longtime residents resist displacement as development swept

westward from the Loop.

The University of Illinois at Chicago researchers working with the IOP were

especially adamant that a new stadium would add little to development already on the

march from downtown. One of their reports pointed out that “there is considerable

evidence that development activity is already moving westward.” According to the

report, between 1984 and 1987, private developers working in the West Loop had

“invested $100 million to rehab more than 1.5 million square feet of former distributional

and light industrial space into loft office space condominiums.”70 A subsequent report

released by the researchers in 1988 cited several examples of central city stadiums around

which growth “was found to be related to downtown expansion” rather than the stadium

themselves. It concluded, “if a sports center is built on the [Near] West Side, there is

likely to be commercial growth to the east because that is already occurring.”71

If the claims made by the IOP and its allies held water, then not only was the

United Center a disappointment in terms of promoting “balanced” revitalization, but also

had a potentially dubious claim to functioning as an anchor of economic revitalization.

Indeed, there is considerable evidence in support of the view that the United Center was less of a motor behind nearby investment than most Chicagoans assumed. In the first place, official documents confirm that a major wave of re-investment pushing westward

69 M.W. Newman, “West Side Story: Bears and Blight,” Chicago Sun-Times, April 19, 1987, NewsBank.

70 Danuzio Lima and Stephen Steinhoff, Community Resources Book, Technical Report No. 1-87 (Chicago, IL: Nathalie P. Voorhees Center for Neighborhood and Community Improvement at the University of Illinois at Chicago, August 1987), prepared for the Interfaith Organizing Project, 76.

71 Steinhoff, A New Sports Stadium, 18. 267

from the Loop had built momentum well before Reinsdorf and Wirtz hatched plans for

the United Center. A community needs analysis commissioned by the city in 1982 noted

that, “in the words of a realtor, the Near West Side is ‘hot.’ It’s got momentum on its side

as an up-and-coming community. The real estate markets point upward: demand exceeds

supply [and] value is increasing.”72 While the analysis did not specify in which Near

West Side neighborhoods the growth was taking place, a memo circulated a few years

later within Chicago’s Department of Planning confirmed that the neighborhoods

between the Loop and West Haven were “experiencing tremendous growth in the

residential, office and commercial market from the conversion of obsolete manufacturing

facilities and redevelopment of large tracts of vacant land.”73

Long before the media latched on to the idea that the United Center was driving

redevelopment in the northern half of the Near West Side, it reported extensively on the

westward push of investment from the Loop into the northern half of the Near West Side

community area. In June 1985, the Tribune alerted readers to an “accelerating

renaissance” in the West Loop Gate neighborhood. “Institutions and corporations are

laying plans to move to [the neighborhood], and developers are ready to launch loft

renovations,” the paper explained.74 An article from the April 1986 issue of Chicago

Magazine pointed to the massive Presidential Towers residential high-rise in West Loop

Gate and the nascent “loft district farther west” as parts of the “Super Loop” emerging

72 Melaniphy and Associates, Chicago Comprehensive Neighborhood Needs Analysis, report prepared for Mayor Jane M. Byrne (Chicago, IL: City of Chicago, 1982), 42.

73 Greg Longhini and Pat Dowell-Cerasoli, internal memo to Robert Giloth, Chicago Department of Planning, May 28, 1987, Box 17, Folder 4, Robert Mier Papers, Chicago History Museum.

74 David Ibata, “Westgate Mill New Life for Old Neighborhood,” Chicago Tribune, June 9, 1985, ProQuest. 268

from “the steady outward movement of redevelopment” from downtown.75 A year later,

the Sun-Times commented on the “advancing offices, apartments and light industry

edging in [westward] from a multibillion-dollar downtown,” and the Tribune observed

“an encroachment of strong-hearted yuppies who are pioneering the renovated loft

apartments and offices” in the southern part of the West Loop.76 The opening of

Presidential Towers allegedly “brought a whole new dimension to the area,” giving the

Tribune the chance to show readers that the stretch between downtown and Ashland

Avenue had appeal not just for gritty yuppies, but also for those with a conventional taste for luxury.77

In the late 1980s and early 1990s, most observers agreed not only that “a tidal

wave of renovation and new construction [was] spreading west” from the Loop, but also

that the new development promised to reach the blocks containing the old Chicago

Stadium and Horner Homes.78 As a reporter for the Sun-Times put it, by the time the

Bears and the city settled on the Near West Side site for a new football stadium, private

investment was already “knocking on the door of poor people [in the Better Alternative

Area] who live behind barred doors on strategic turf.”79 Alex Kotlowitz, a journalist who

spent several years interviewing Horner residents in the late 1980s, agreed. In his 1991

best-seller There Are No Children Here, Kotlowitz writes, “since the city’s downtown

75 Patrick Barry, “Ring Around the Loop,” Chicago Magazine, 35, no. 4 (April 1986), 158, 140.

76 M.W. Newman, “West Side Story: Bears and Blight”; Patrick Reardon, “Stadium Could Fill Urban Void,” Chicago Tribune, April 14, 1987, ProQuest.

77 William Mullen, “West Side Story From Skid Row’s Ashes,” Chicago Tribune, February 8, 1986, ProQuest.

78 Don DeBat and Gary Meyers, “Near West Side Property Values Get High Grades,” Chicago Sun-Times, June 22, 1990, NewsBank

79 M.W. Newman, “West Side Story: Bears and Blight.” 269

can’t expand to the east because of Lake Michigan, it has crept westward, past the

Chicago River and through the city’s once notorious skid row, certain to bump eventually

right up against Henry Horner.”80

The recollections of real estate investors active in the West Loop during the eighties also suggest that boosters who touted the arena’s alleged economic development function conveniently overlooked the recent history of revitalization to the east. Annie and Lewis Kostiner, who began converting old manufacturing spaces in the West Loop into residential and commercial properties in the late 1980s, emphasize that by 1988 they had started buying up land just a few blocks east of property eventually occupied by the

United Center—well before Reinsdorf and Wirtz finalized plans for the new arena. As

Annie recalls, they got involved in real estate development in the area because it was close to downtown and the land was cheap—not because of a sports arena. “What I remember the most was the emphasis on the location, on being confident that this would be a good project because of the proximity to the Loop, so we ran with [it] because the property was affordable,” she explains. As she and Lewis continued their development efforts during the nineties, they “never talked about the United Center” except in the context of the Democratic National Convention in 1996, which they admit provided a boost to the area by prompting the city to complete infrastructural improvements between the Loop and the arena at a quicker-than-usual pace. Otherwise, the United Center was an afterthought—something that other real estate developers in the West Loop could do without.81

80 Kotlowitz, There Are No Children Here, 158-59.

81 Annie Kostiner, interview by author, August 25, 2011, transcript available upon request; Lewis Kostiner, interview by author, August 25, 2011, transcript available upon request. The Kostiners did not recall the 270

Much of the available data on pre-United Center development in the Near West

Side also backs up the conclusion that investment was headed for West Haven whether or not a new sports facility went up. Map 4.7 shows the location of all building permits filed for new construction in the Near West Side and the Loop from 1987 through 1990. North of the Eisenhower Expressway, new construction over the four-year period concentrated in the western part of the Loop. Nevertheless, the building permits confirm that investors had already started to make forays into both West Loop Gate and the West Loop. Much of this new real estate investment consisted of loft conversions for use by commercial tenants attracted to “cheap office rents and the area’s proximity to the Loop.”82 For

example, one of the new construction permits was for a Federal Express facility that

opened just a few blocks east of Chicago Stadium at Madison and Racine. Other permit

records show that, by 1990, banks, restaurants, and even a couple new single-family homes had popped up west of the Kennedy Expressway, in easy walking distance to the old home of the Bulls and Blackhawks.83

Unfortunately, building permits issued for new construction offer a poor measure

of new development since they tell us nothing about investment in the renovation and/or

conversion of old structures. This is especially true in a city like Chicago, where in recent

decades old industrial space has become prized real estate for artists and young

professionals enamored of “loft living.” Map 4.8 provides a partial corrective to this

problem. It plots all new development—new construction or otherwise—in the West

Bears stadium plan at all, which suggests that they were not investing based on anticipation of a nearby stadium development. The Kostiners had developed over a million square feet of loft space by 1992. Ilyce Glink, “Rewriting Near West Side Story,” Chicago Tribune, August 16, 1992, ProQuest.

82 Mullen, “West Side Story From Skid Row’s Ashes,” Chicago Tribune, February 16, 1986, ProQuest.

83 City of Chicago Department of Planning and Development, Chicago Neighborhood Development: New Construction 1987-1990, 239-241. 271

Loop and West Haven from 1983 through 1990 mentioned (by address or intersection) in any of the popular press or real estate publications reviewed in the process of researching this chapter. Admittedly, this is an inexact representation of the local development history. However, like Map 4.7, it documents a significant amount of activity by investors immediately to the east of West Haven prior to the United Center deal. In 1987,

IOP president Reverend Arthur Griffin told the papers, “developers are salivating to get in here with or without a stadium. The catalyst is our geographic proximity to the

Loop.”84 Together, these maps suggest that he was right.

84 Fran Spielman, “Stadium ‘Only Chance’ for Area,” Chicago Sun-Times, April 17, 1987, NewsBank. 272

Map 4.7. Permits Issued for New Construction by the City of Chicago, Near West Side and Loop, 1987-1990. Sources: Shapefiles obtained from City of Chicago, Chicago Data Portal; building permit data obtained from City of Chicago Department of Planning and Development (1992).

273

Map 4.8. Sites of New Construction or Renovation Noted in Local Media and Real Estate Publications, Northern Half of Near West Side, 1983-1990. Sources: Shapefiles obtained from City of Chicago, Chicago Data Portal. Address data obtained from Don DeBat and Gary Meyers, “Near West Side Property Values Get High Grades,” Chicago Sun-Times, June 22, 1990, NewsBank; Lima and Stephen Steinhoff (1987), 76; Chicago Applied Real Estate Analysis (1988).

In the years after the arena opened, a handful of mainstream commentators pointed out that, rather than surrounding it on all sides, most new development was popping up between the United Center and the Loop (i.e. where it had been occurring already in the pre-United Center years). In 1996, an article in the Tribune observed, “the rapid growth in the last two years has been east of Ashland Avenue [in the West Loop].85

In 1997, Crain’s Chicago Business stated plainly, “most new development is still east of

Ashland Avenue.”86 A full decade later, a report issued by a non-profit working with the

85 Ellen Rooney Martin, “Bouncing Back,” Chicago Tribune, August 24, 1996, ProQuest.

274

NWSCDC to finance additional development in West Haven observed “increasing

development activity principally moving in from the east.”87 According to these

accounts, not much had changed since the 1980s in terms of the trajectory of

development in the Near West Side’s northern half. The neighborhoods to the east

continued to experience rapid growth as investment fanned out westward from the Loop,

while communities lying to the west of Ashland Avenue lagged behind. In short,

development appeared to be moving towards the United Center, not radiating outward

from it.

Admittedly, by the late 2000s, new investment—beyond that accounted for by

redeveloped public housing or new homes developed by Gates and the NWSCDC—had surrounded the United Center, even to the west. Between January 2008 and August 2013, the Chicago Department of Buildings issued 259 building permits for new construction and renovation in West Haven (including the industrial corridor west of Ashland Avenue, see map 4.9). However, distinguishing between development accounted for by the

“anchor” effect of the arena and by the spillover of investment from the West Loop is impossible. Examining the map of the very recent history of permit issues allows for two conflicting interpretations. One could look at the map, note the proliferation of permits to the west of the arena, and conclude that the United Center has fulfilled its promise as a node of revitalization. Alternatively, one could point to the difference between the density of permits in the West Loop and West Haven make an equally compelling argument that, at a certain point, development had nowhere else to go but west across

86 Jane Adler, “Biz Inches West Toward United Center,” Crain’s Chicago Business, May 5, 1997, ProQuest.

87 Local Initiatives Support Corporation (MetroEDGE), Westhaven Market Study, 3. 275

Ashland Avenue and beyond the arena. Between January 2008 and August 2013, Chicago issued 517 permits for the West Loop alone (i.e. not including West Loop Gate).

Visually, the high density of new construction and renovation in the West Loop relative to West Haven suggests a corridor of ongoing investment radiating outward from the loop, and decaying in intensity with increasing distance from downtown. While this is admittedly impressionistic evidence, the fact that it just as easily supports an interpretation that de-centers the United Center’s role in economic revitalization as it does the pro-arena position should give pause to proponents of the arena-as-anchor thesis.

276

Map 4.9. Building Permits Issued for New Construction and Renovation, West Haven and West Loop, January 2008-August 2013.a Source: Basemaps provided by ESRI. Shapefiles and permit data obtained from City of Chicago, Chicago Data Portal. a West Haven and West Loop definitions based on 1990 tract boundaries, which allow for a tighter fit around the respective neighborhoods and thus a more accurate count of permits.

The point here is not that the United Center had no economic impact on the

surrounding neighborhood. Money from Reinsdorf and Wirtz helped the NWSCDC lure

some new homeowners to West Haven, and the 1996 DNC certainly lit a fire under the

city to make infrastructural improvements near the arena. Even Spirou and Bennett admit

that the arena likely had an important “showcasing” effect for the Near West Side in this

regard.88 But arguing that the United Center played a seminal role in local economic

88 Spirou and Bennett, It’s Hardly Sportin’, 160. 277

redevelopment relied on several bold assumptions. In the first place, it assumed that

development in West Haven during the late 1990s and 2000s had little spatial or

historical connection to the previous investment in the blocks that separated the neighborhood from the Loop. The local real estate market had been creeping east towards

West Haven since the early 1980s. Given the rapid depopulation and surplus of vacant

(i.e. cheap) land in West Haven, it’s hard to believe that developers would have stopped their push east of Ashland Avenue in the absence of the United Center. It’s especially hard to believe in the context of the late 1990s and early 2000s, when macroeconomic conditions such as real income gains (Chicago’s real median income jumped 9.3% during the nineties) and periods of extremely low interest rates nudged real estate developers and homebuyers to move into new trendy neighborhoods close to downtown.89

The United-Center-as-revitalizer thesis also assumed that new investment by the

city would never have materialized without a new arena. Actually, the majority of

infrastructural investment made by the city in support of the DNC occurred east of the

arena or in other community areas altogether.90 Given the fact that under Richard M.

Daley the city was quick to inject funds for infrastructure and beautification into

gentrifying neighborhoods without new sports facilities, it remains up for debate whether

or not the DNC generated new public investment, or simply accelerated investment by

the city in the West Loop that was already imminent. In their case study of the United

Center, Spirou and Bennett point out that the West Loop and West Haven stood well

89 Dean Baker, Plunder and Blunder: The Rise and Fall of the Bubble Economy (Sausalito, CA: Polipoint, 2009), 36-37. Income gains were driven primarily by rises in productivity, not by redistribution. For income data, see Brookings Institution Center on Urban and Metropolitan Policy, Chicago in Focus: A Profile from Census 2000 (Washington, D.C.: Brookings Institution, 2003).

90 Annie Kostiner, interview by author; Lewis Kostiner, interview by author. 278

within the geographic orbit of Daley’s larger “macrogentrification” strategy, which involved a “concerted effort to redefine and expand Chicago’s downtown core.”91

Perhaps the stadium sped up these efforts on the Near West Side, but new development was pushing west with or without the United Center, just as it had in the late eighties and early 1990s.

Even urban historian Alexander von Hoffman, who writes glowingly of the

United Center’s role in local revitalization, stops short of arguing that the return of investment to nearby neighborhoods hinged on the arena’s presence. In his final assessment, he claims that “it was the opening of the United Center…that accelerated growth and revival” in the northern half of the Near West Side.92 Indeed, given the seeming path-dependence of redevelopment pushing out from the Loop, an

“acceleration” scenario in which the arena helped pull development westward was the best-case scenario. However, in the years after it opened in 1994, many Chicagoans began to question not only the degree to which the arena accounted for new investment, but whether or not its effect on local investment was even positive.

“A Stranded Concrete-and-Glass Whale”: The United Center as Planning Disaster

After the United Center opened, Chicago’s mainstream media occasionally took note of the fact that, despite the money from Reinsdorf and Wirtz and the NWSCDC’s aggressive marketing of new homes, a stark gradient still existed between yuppie-driven development concentrated in the West Loop and the continued visibility of poverty in

West Haven. In 1996, the Tribune’s architecture critic Blair Kamin conceded that West

91 Spirou and Bennett, It’s Hardly Sportin’, 157, 168.

92 Von Hoffman, House by House, 145. 279

Haven “no longer looks shabby,” but insisted that there were still “two Madison Streets— one east of Ashland [Avenue], a gentrifying landscape where yuppie restaurants set tables along the sidewalks; the other west of Ashland, a depressing landscape where unemployed men and women mill about the sidewalk.”93 Perhaps it was unrealistic to expect dramatic change so soon, but more than a decade later the divide was still visible by some accounts. In 2006, the Sun-Times explained, “since its opening in 1994, the

United Center has been credited with leading a turnaround of the Near West Side. But stretches of Madison Street near the stadium are still empty or hold only small decayed stores.”94

Some attributed this continued unevenness of development to the thousands of public housing residents who remained in West Haven as a result of the consent decree.

In 1997, Crain’s Chicago Business cited unnamed sources who claimed that “developers are leery about getting too close to public housing projects west of the United Center.”95

Looking back on the history of development in the neighborhood, Earnest Gates agrees.

“As soon as folks realized that there’s public housing on the street, it took [away] the economic incentive for some [to move in],” he recalls.96 Gates went so far as to tell the

Chicago Reporter in 2009 that he and other community leaders had lobbied to maintain a high density of public housing residents in order to “booby-trap” West Haven against

93 Blair Kamin, “The Big Fix,” Chicago Tribune, August 4, 1996, ProQuest.

94 David Roeder and Fran Spielman, “Madison St. in Play,” Chicago Sun-Times, September 19, 2006, NewsBank.

95 Adler, “Biz Inches West Toward United Center.”

96 Earnest Gates, interview by author.

280

gentrification. He explained, “we put scattered-site public housing in the neighborhood to make it distasteful for really, really higher income.”97

Given the contentious relationship that developed between Gates and many public

housing residents during the 1990s, the notion that he orchestrated the retention of

subsidized housing to “booby-trap” the community against gentrification seems like a

romantic and self-serving rewriting of history.98 In any case, it is possible that the

continued presence of CHA tenants in West Haven deterred some middle- and upper-

income people from buying or renting in the neighborhood. According to one set of urban

planning experts, many real estate professionals active in Chicago during the 1990s

applied a rule of thumb that the proportion of a neighborhood’s public housing

population had to drop below one third before investors could generate sufficient demand

for market-rate housing and commercial and retail development.99

Blaming the slow pace of development in West Haven entirely on the continued

presence of public housing residents, however, diverted attention away from another

culprit: the design of the United Center itself. Two aspects of the arena’s integration (or

lack thereof) into the built environment became especially problematic in the context of

97 Kelly Virella, “Black and White, Seeing Red All Over: Major Retailer’s Search for Green Kicks Up Racial Tension in Chicago’s Gentrifying Areas,” Chicago Reporter, September 1, 2009, accessed May 17, 2013, http://www.thefreelibrary.com/Black+and+white,+seeing+red+all+over%3A+major+retailers'+search+for.. .-a0209695561.

98 Gates made these pronouncements only after Horner residents secured the consent decree (i.e. when it was clear that public housing residents were in the neighborhood to stay).

99 Bennett, Hudspeth, and Wright, “A Critical Analysis of the ABLA Redevelopment Plan,” 204. The fact that several CHA mixed-income redevelopments have had as much or more difficulty attracting market-rate buyers as the Horner redevelopment at West Haven suggests that much of this “tipping point” rhetoric is oversimplified. While it is true that as of 2012 many of the market-rate units in West Haven remained unsold, the percentage of unsold market-rate units was just as high or higher at several other mixed-income developments in the city that retained smaller percentages of traditional public housing residents. See Micah Maidenberg, “Real Estate Collapse Cripples CHA Plan to Mix Homeowners, Renters,” Crain’s Chicago Business, October 1, 2012, ProQuest. 281

ancillary development in West Haven. First, both anecdotal accounts and official

planning documents reveal that the surface parking sited around the United Center impeded development in the surrounding neighborhood by taking up an inordinate amount of space and inhibiting the free movement of residents and visitors. Second, by very consciously ensuring that the United Center functioned as a fully internalized,

luxury entertainment center in which fans could indulge any imaginable urge for

consumption, Reinsdorf and Wirtz guaranteed that retail establishments like restaurants,

bars, and souvenir shops would have a very hard time competing with the arena.

In 1996, the Tribune offered one of the first indications that the United Center had

actually disrupted redevelopment in West Haven. “Much of the surrounding

neighborhood [has] been paved over to form a sea of parking lots in the middle of which

the new United Center sits like a stranded concrete-and-glass whale,” the paper explained.100 Soon after, Walter Burnett, Jr., the local alderman, told a reporter that the

parking lots around the arena were hindering efforts to construct additional infill housing

in West Haven. “Nothing can happen until the parking lot guys move,” Burnett

complained. “Our hope and goal is that one day, the United Center will build a [multi-

level] parking structure…to alleviate the parking lots.”101 Even Gates admits that arena

parking seriously limited development nearby, since it effectively created acres of

permanently vacant, underutilized land (save on game nights). “You can’t get the

businesses, the stores and the stuff that is vital to a community’s day-to-day life because it’s vacant,” he explains.102 Lewis Kostiner, the aforementioned real estate investor who

100 Charles Leroux and Ron Grossman, “West Side Stories,” Chicago Tribune, August 26, 1996, ProQuest.

101 Adler, “Biz Inches West Toward United Center.”

282

had become active in the West Loop during the 1980s, also believes that the sprawling

arena-parking complex acted as an impediment to investment. Looking back, he has “no

doubt that if the United Center were not there, there would have been massive amounts of

housing built.”103

According to these accounts, the arena crowded out additional residential

development and, by extension, retail and commercial development that needed a rich

market of nearby resident-consumers to thrive. Both Burnett and Gates insisted that

blame for the parking problem lay as much in the lap of lot owners unaffiliated with the

United Center who set up shop on the outskirts of the arena as it did with Reinsdorf and

Wirtz, but this simply was not the case. According to land use data from the Chicago

Metropolitan Agency for Planning, United Center property alone—the overwhelming

majority of which consisted of parking lots—ate up nearly 55 acres in West Haven!104

Moreover, according to Gates, Reinsdorf and Wirtz bought out several of the non-United

Center lots during the nineties, and they opted to maintain the new lots for their own

profit rather than open them up for redevelopment.105 The domination of the local

landscape by surface parking was, first and foremost, the responsibility of arena

ownership.

A decade-and-a-half after the arena opened, the parking lots remained a serious

impediment to development in West Haven. When the Tribune asked in May 2008, “why

102 Earnest Gates, interview by author.

103 Annie Kostiner, interview by author; Lewis Kostiner, interview by author.

104 Chicago Metropolitan Agency for Planning, Land Use Inventory, 2001 (Chicago Metropolitan Agency for Planning, Chicago, IL, 2001), accessed May 17, 2013, http://www.cmap.illinois.gov/land-use- inventory.

105 Earnest Gates, interview by author. 283

hasn’t [the United Center’s] Near West Side neighborhood been redeveloped as

dramatically as Chicago officials expected,” the first answer it came up with concerned

the moat of surface parking surrounding the arena. “There’s so much space,” the paper

explained, “the blocks around the United Center’s 40-plus acres don’t yet have the anchor

institution that would make the area as vibrant in the daytime as it is on game nights.”106

The irony here was likely lost on most readers. The voice of the Chicago establishment, which had gushed over the United Center’s promise as an “anchor” development west of

Ashland, now argued that the slow pace of development had resulted from the inhospitable spatial environs created by the arena. Academic commentators familiar with the neighborhood echoed the latter interpretation. In a 2011 interview urban planning expert Rachel Weber explained that the “sea of surface parking lots” was “not exactly the kind of setup you want to have if you want a sort of more integrative neighborhood, or if you want an institution to have effects on the surrounding area.”107

Perhaps the starkest evidence of the United Center’s failure from a design

perspective came from a series of studies published jointly by the Chicago Department of

Planning and the Regional Transportation Authority in 2008. The reports candidly

concluded that the United Center had precluded more robust development in West

Haven. One section explained, “the United Center and its associated surface parking lots

are an impediment to creating a cohesive neighborhood,” and emphasized the United

Center’s role as a “barrier to connecting [West Haven] and West Loop areas.” “Yet, this

106 “Option 7: Bulls & Kids,” Chicago Tribune, May 7, 2008, ProQuest.

107 Mark Boyer, “Urban Planning Folly: The United Center and the Near West Side,” Curbed Chicago, May 9, 2011, accessed May 17, 2013, http://chicago.curbed.com/archives/2011/05/09/urban-planning- folly-the-united-center-and-the-near-west-side.php.

284

underdeveloped land also presents an opportunity to plan for large-scale infill which can

create new retail and hospitality uses, as well as employment,” it went on.108 Strikingly,

the reports situated the arena site as a planning liability that had to be worked around or

“targeted” for redesign. Its recommendations included relocating arena parking so that “a

new vision for the Madison [Street] corridor can be explored,” and, more specifically,

that “future infill development” could replace “the large area of surface parking lots

surrounding the arena.”109

The research conducted by the Department of Planning not only verified that

excessive amounts of parking had contributed to the “isolation” that continued to afflict

many blocks in West Haven, but also pointed out that the physical layout of the arena had

transformed West Haven into an unwelcoming space for residents and visitors. “The pedestrian environment for day-to-day movement around the area is uncomfortable due to open expanses of parking…The presence of this intimidating space inhibits local pedestrian movement in all directions,” one of the reports noted.110A map created by the

Department of Planning (see Figure 4.2) specifically marked several desirable pedestrian

routes blocked by the United Center and its parking lots. The map offers compelling

visual evidence of how the “House that Jordan Built” was no exception to what political

scientist Charles Euchner describes as the tendency of stadiums constructed at the end of

108 City of Chicago Regional Transportation Authority and Metropolitan Planning Council, Existing Conditions Report: Near West Study Area (Chicago, IL: Chicago Reconnecting Neighborhoods, February 2008), accessed May 17, 2013, http://reconnectingneighborhoods.org/resources/pdfs/WestExConReport_May6_2008.pdf, 5, 13.

109 City of Chicago Regional Transportation Authority and Metropolitan Planning Council, Existing Conditions Report, 9.

110 City of Chicago Regional Transportation Authority and Metropolitan Planning Council, Existing Conditions Report, 15. 285

the twentieth century to “destroy ‘linkage-rich’ space” and preclude the emergence of

“tight-knit neighborhood patterns.”111

Figure 4.2. Detail from Official Chicago Department of Planning Map Showing United Center’s Interference with Pedestrian Traffic in West Haven. The yellow X’s indicate blocked pedestrian routes. Source: City of Chicago Regional Transportation Authority and Metropolitan Planning Council (2008).

The Department of Planning went so far as to call for the use of public money to

“target the area surrounding the United Center…for service and entertainment-oriented retail development in conjunction with structured parking to serve visitors.”112 That the

city felt that it had to step in with taxpayer dollars to help correct the situation betrayed

the absurdity of the history of stadium-linked development in West Haven. City oficials

had billed the United Center as the ideal public-private partnership, only to admit decades

111 Euchner, Playing the Field, 70, 29.

112 City of Chicago Regional Transportation Authority and Metropolitan Planning Council, Final Recommendations Report (Chicago, IL: Reconnecting Neighborhoods, December 2008), accessed May 17, 2013, http://reconnectingneighborhoods.org/resources/pdfs/WestExConReport_May6_2008.pdf, W-6. 286

later that the arena had created as many problems as it had solved. The interests of a

couple of team owners had not only trumped the priorities of many of the neighborhood’s

longtime low-income residents, but also those of contingents within Chicago’s growth

machine interested in capitalizing on dense residential and commercial development in

close proximity to downtown. While it may have had the “showcasing” effect attributed

to it by Bennett and Spirou, the arena appears to have simultaneously impeded the

westward march of Loop-linked development across Ashland Avenue. Moreover, in a

design context, it certainly clashed with the second Mayor Daley’s larger effort to

transform central city neighborhoods into pedestrian-friendly locales appealing to

Chicago’s new urban gentry. Twenty years after construction crews broke ground on the

United Center, the only clear winners were sitting in the owners’ box at Bulls and

Blackhawks games.

The point about the dissonance between the design of the United Center and the

desire among parts of Chicago’s pro-growth coalition to create an expanded “Super-

Loop” deserves elaboration. Few United Center boosters went so far as to argue that a

new arena would lead directly to the expansion of Chicago’s economy as a whole; the

fact that Reinsdorf and Wirtz picked up the tab for construction costs effectively

dispensed with the need to concoct farcical “economic impact” statements often used to

bilk taxpayers into supporting referenda to publicly fund sports facilities.113 However,

claims that the United Center would revitalize a small part of the Near West Side were

not totally outlandish. As economists John Siegfried and Andrew Zimbalist note, big-

league facilities can, in theory, “reposition economic activity within a metropolitan area”

113 On these statements/studies, see John Siegfried and Andrew Zimbalist, “The Economics of Sports Facilities and Their Communities,” Journal of Economic Perspectives 14, 3 (Summer 2000): 103. 287

so as to facilitate the redevelopment of individual neighborhoods or urban cores.114 This

might have happened in West Haven if locals and visitors had redistributed their

entertainment spending to businesses in the immediate vicinity of the United Center. The

problem with this theory was that the arena’s design precluded this from happening.

This was no coincidence; the seemingly irrational design of the arena made

perfect sense when it came to generating revenue for Reinsdorf and Wirtz. Property tax

records from the Cook County Board of Review show that by the early 2000s, the team

owners were pulling in upwards of $2 million a year in parking receipts. Moreover, they

had a vested interest in ancillary commercial development not occurring in the immediate

vicinity of the arena; a proliferation of restaurants, bars, and other entertainment facilities

near the United Center might have thwarted ownership’s efforts to monopolize the local

concessions market. By physically crowding out rival establishments, Reinsdorf and

Wirtz avoided having to share millions in annual concessions revenues, and ensured that

the Chicago glitterati paying top dollar for luxury suites did not develop the urge to ditch

their leases and satisfy their pre-game appetites outside the turnstiles.115 The parking lots

weren’t going anywhere, no matter how detrimental they proved to surrounding

development.

One way to visualize how this politics of land use played out on the ground is to

look at data on vacant, unused land in West Haven before and after the United Center

114 Siegfried and Zimbalist, “The Economics of Sports Facilities and Their Communities,” 109. On the issues of redistribution of economic activity via sports facilities, also see Mark Rosentraub, Major League Winners: Using Sports and Cultural Centers as Tools for Economic Development (Boca Raton, FL: CRC Press, 2010); and Charles Santo, “Economic Impact of Sports Stadiums, Teams, and Events,” in Sport and Public Policy, ed. Charles Santo and Gerard Mildner (Champaign, IL: Human Kinetics, 2010), 49-64.

115 According to revenue records on file with the Cook County Board of Review, between 2002 and 2007, revenues for “catering/club/novelties” (i.e. concessions) reached as high as $3.6 million in the “year ended” 2003. Cook County Board of Review, Freedom of Information Act Request #WCB081711, August 17, 2011. 288

opened. Map Series 4.10 shows that the construction of the arena definitely coincided

with a noticeable decline—63 percent to be exact—in the amount of vacant land in West

Haven between 1990 and 2001. Much of the unused land became arena parking, but some

of the other vacant lots did become the site of new residential or institutional

development.116 However, between 2001 and 2005 (the last year for which data is available), the amount of vacant land in West Haven actually increased by over 310,000

square feet.

Contrast this with the West Loop neighborhood to the east and East Garfield Park

to the west. As shown in Figure 4.3, the neighborhoods on either side of West Haven saw significant drops in the square footage of vacant land between 1990 and 2001, and continued—if less dramatic—declines between 2001 and 2005. Admittedly, West Haven had the largest absolute and percentage decline between 1990 and 2001 (though if you

remove the vacant land eaten up by the arena footprint itself from the calculations, the

West Loop saw a greater reduction in percentage terms). West Haven, however, was the

only one of the three neighborhoods where, according to the data, the decline actually reversed between 2001 and 2005. The plateau in investment in the arena’s immediate

vicinity indicated by these figures, combined with the ongoing reduction in vacant land

area in both East Garfield Park and the West Loop, fits together quite well with a story in

which arena developers were more interested in insulating their own investment from

116 The construction of the United Center accounted for 41.2% of the overall reduction in vacant land between 1990 and 2001 (or 1,445,814.36 of 3,505,824.75 square feet). Author’s calculations based on intersecting map of United Center property from 2001 with 1990 land use map. Chicago Metropolitan Agency for Planning, Land Use Inventory (Chicago, IL, 1990, 2001), http://www.cmap.illinois.gov/data- land-use. 289

competition than in creating the conditions in which ancillary development could take shape.117

117 To be exact, the amount of vacant land in West Haven went from 2,071,521 square feet in 2001 to 2,383,102 square feet in 2005. Chicago Metropolitan Agency for Planning, Land Use Inventory (Chicago, IL, 2001, 2005), http://www.cmap.illinois.gov/data-land-use. 290

Map (Series) 4.10. Land Use in West Haven Tracts, 1990-2005.a Source: Shapefiles obtained from Chicago Metropolitan Agency for Planning (1990, 2001, 2005); Minnesota Population Center (2011). a 1990 Census tract boundaries were used for this particular analysis because they allow for a tighter boundary around West Haven and more accurate computation of land use statistics. Unfortunately, there is no standardized data across decades for the 1990 tracts, which is why the previous maps on population change employ 2010 boundaries.

291

1990 2001 2005

8.0

7.0

6.0

5.0

4.0

3.0

2.0

1.0

0.0 Vacant, Unused Land (millions of square feet) square of (millions Land Unused Vacant, West Haven West Haven West Loop East Garfield Park (not including United Center footprint) Neighborhood

Figure 4.3. Vacant, Unused Land in West Haven, the West Loop, and East Garfield Park, 1991- 2005.a Sources: Chicago Metropolitan Agency for Planning (1990, 2001, 2005). a These computations correspond to neighborhood boundaries used in Maps 4.9 and 4.10. The 1990 bar for West Haven (not including United Center footprint) computed by subtracting the amount of vacant land reduced as a direct result of United Center construction from the total amount of vacant land in West Haven in 1990.

The efforts by Reinsdorf and Wirtz to make sure that every last cent of event-

related spending took place within the arena not only precluded investment in the

surrounding community, but also guaranteed what economists refer to as “leakage” of

stadium-generated revenues out of the local area. Since most of the revenues found their

way into the pockets of the team owners and players—people who, generally speaking, spent little time in West Haven outside the confines of the United Center—not much of this money re-circulated as spending in West Haven or other nearby neighborhoods.118 It

118 For a helpful summary of the “leakage” problem, see Santo, “Economic Impact of Sports Stadiums.” 292

may have been the “House that Jordan Built,” but Jordan and his teammates lived and

spent their money elsewhere.

In the end, the United Center’s “fortress”-like design undercut its potential to increase the day-to-day quality of life of longtime residents in West Haven.119 Roger

Watson, a senior-citizen and public housing resident living in West Haven during the

1996 Democratic National Convention, bluntly summed up the situation for the Sun-

Times. “They don’t care about people like us,” Watson said of United Center ownership

and city officials. “Concrete. Blacktop. Fences. These aren’t for the people here. What

are we going to do with that stuff?”120 No wonder that, during the struggle against the

Bears, the Interfaith Organizing Project had criticized the surplus of “underutilized

development opportunities…like the surface parking lots around [the old] Chicago

Stadium.”121 Given the fact that low-income residents at Horner had won the right to stay in the neighborhood with or without a new arena, they probably stood a much better chance of benefiting from loop-linked development based on high-density residential and

commercial investment. It is true that mixed-income developments based on the latter model have struggled to foster meaningful economic integration, but certainly such a model was more likely to facilitate full-time job growth and a more physically cohesive built environment than what occurred around the United Center.122

119 Boyer, “Urban Planning Folly.”

120 Celeste Garrett, “They Don’t Care About People Like Us,” Chicago Sun-Times, September 11, 1996, NewsBank.

121 Interfaith Organizing Project, The Better Alternative Plan.

122 On the ambiguous and often disappointing social outcomes of mixed-income development, see Alex Schwartz and Kian Tajbakhsh, “Mixed-Income Housing: Unanswered Questions,” Cityscape 3, no. 2 (1997): 71-92; Mark Joseph and Robert Chaskin, “Living in a Mixed-Income Development: Resident Perceptions of the Benefits and Disadvantages of Two Developments in Chicago,” Urban Studies 47, no. 293

***

When the IOP drafted the original “Better Alternative Plan” in 1987, it proposed

“that underutilized development opportunities, like the surface parking lots around…the

[old] Chicago Stadium, be opened up for neighborhood-scale housing.”123 Local residents and organizers knew from decades of experience that stadium-linked “development” was more problem than solution, and despite early optimism around the deal cut with

Reinsdorf and Wirtz, what emerged in West Haven was the opposite of the vision at the heart of the IOP’s original proposal. By the time the United Center opened, residents had to contend with more parking lots, and it didn’t take long for many to realize that, if anything, the new arena made the area more inhospitable for residents, visitors, and investors.

With the exception of the redeveloped Horner units, most of the new housing that sprouted up in West Haven supported a model of development inherently hostile to longtime, low-income residents. If Chapter Three shows that those who championed the

United Center as a panacea for underdevelopment emerged as antagonists towards the priorities of the neighborhood’s poorest inhabitants, this chapter confirms that this antagonistic relationship coincided with, and likely encouraged, the displacement of

11 (October 2010): 2347-2366; and Robert Chaskin and Mark Joseph, “Social Interaction in Mixed-Income Developments: Relational Expectations and Emerging Reality,” Journal of Urban Affairs 33, no. 2 (2011): 209-237. While some boosters and city officials cited the job-creating power of the United Center as the reason behind their support, there is very little evidence to suggest that the arena has served as a meaningful source of stable, living-wage employment for neighborhood residents. The sparse anecdotal evidence that exists in regard to the jobs question suggests that the arena has a less than illustrious record. See Bennett, Third City, 149-50. Moreover, recent neighborhood reporting in West Haven has emphasized “the relative lack of entry-level job opportunities in the area.” See Igor Studenkov, “Mixed Success: Four Years After Last of Horner Homes Came Down, How Has Life Changed in West Haven?,” Chicago Journal, February 22, 2012. Much more often than not, sports economists have expressed skepticism about the potential of sports facilities to generate good jobs for local residents. The positions filled by people from surrounding neighborhoods tend to be low-wage and seasonal. For more on this, see the selections in Noll and Zimbalist, eds., Sports, Jobs, and Taxes.

123 Interfaith Organizing Project, The Better Alternative. 294

thousands of longtime residents. The steering of stadium-linked community investment

towards the expansion of private homeownership converged with broader shifts in local

and federal urban policy to ensure that little room remained for the community’s most

vulnerable members (at least those without protection from the courts). Obviously, those

pushed out never had the chance to participate in a redevelopment of West Haven that

prioritized use values—economic and physical security, sense of stable community, etc.—relevant to their day-to-day survival and happiness.

The gentrification that did occur in West Haven post-United Center did not,

however, coincide with a full-fledged economic recovery of the neighborhood. Design

decisions intended to maximize profits for Reinsdorf and Wirtz ultimately reduced the

appeal and viability of the neighborhood for prospective residents and investors. Perhaps

the cachet of the new arena helped accelerate investment in the West Loop (east of

Ashland Avenue), but most of the available evidence supports the conclusion that the

United Center “barely registers as a local economic force.”124 That development had been

on the march towards West Haven since the 1980s begs the question of whether or not

the arena did much of anything other than get in the way of the expansion of the Loop

engineered by the Daley administration.

For just about everyone except Reinsdorf and Wirtz, stadium-linked development

around the United Center came up short. Low-income residents were swept aside, and even for many private developers with little interest in helping those low-income residents stay put, the arena represented more of a bane than boon. Unfortunately, the list of losers in the history of the United Center doesn’t stop there. The next two chapters

124 Bennett, Third City, 149. 295

reveal that just about everyone—from local peanut vendors to local schoolchildren—paid a high price for the House that Jordan built.

296

Chapter Five

A Bad Case of “Peanut Envy”: Concessions Markets and Monopoly Power at the United Center

When the United Center opened its doors on Chicago’s Near West Side in 1994, the new state-of-the-art basketball and hockey arena offered the ultimate in fan experience. Bulls season-ticket holders suffering through the first of Michael Jordan’s many retirements could at least take solace in the “carbon dioxide-powered condiment dispensers,” the “computerized heating and cooling system,” or any other of the United

Center’s many accoutrements “designed to pamper paying customers.”1 But for those fans who had relished the traditional feel of the old Chicago Stadium, where the Bulls made their first three championship runs of the 1990s and where the Blackhawks had brought home a conference championship in 1992, something more than Michael Jordan was missing from the new arena. Peanuts, the snack food of choice for thousands of fans, had simply disappeared. Bulls and Blackhawks fans could not buy them inside, and the vendors from whom they used to buy them outside the old Chicago Stadium had vanished.

The disappearance of peanuts might seem like the logical outcome of the efforts by the Bulls (and the Blackhawks) to cultivate and cater to a market of fans eager not just to take in a game at the United Center, but also indulge in its luxurious concessions, which included “everything from 45 varieties of wine to Norwegian salmon and aged prime rib.”2 While some members of this elite clientele may have preferred caviar to

1 Jeff Borden, “United Ctr.’s Gee-Whiz Gizmos,” Crain’s Chicago Business, November 11, 1996, LexisNexis.

2 Barbara Sullivan, “Wirtz Scion Takes Aim at Big Goal,” Chicago Tribune, May 20, 1992, ProQuest. 297

peanuts, the story behind the latter’s disappearance is not simply about the evaporation of

demand. After all, the United Center continued to offer low-brow concessions like hot

dogs and watered-down domestic beer. In fact, Jerry Reinsdorf and Bill Wirtz waged an aggressive campaign against the aforementioned peanut vendors in an effort not only to

monopolize concessions sales, but also to police the space around the arena. Using the

combination of a prohibition on food brought into the arena from outside and a newly-

created local ordinance banning street vendors from within 1,000 feet of the venue, they

snuffed out efforts by locals to compete against the United Center in the concessions

market. In the face of legal challenges mounted by the peddlers, the owners benefited

from a prevailing judicial logic that prioritized monopolists’ “freedom” to operate

unhindered by state intervention over the freedom of independent competitors to access

customers who still wanted to buy their product. At the same time, Reinsdorf and Wirtz

convinced local politicians to push through a municipal ordinance barring the vendors

from around the arena. The legislation ensured the elimination of economic competition

regardless of the opinion of the courts and criminalized the presence of local workers

who threatened the image of the United Center as a comfortable environment for

moneyed fans from the suburbs, Loop, and the North Side.

The role of monopoly power in the U.S. sports business has drawn the attention of

many scholars, most notably those in the fields of economics and law. Part of the topic’s

allure has to do with the unique place of sports leagues within the larger history of

competition policy in the U.S. Since the Supreme Court handed down a 1922 ruling

granting Major League Baseball an exemption from antitrust action that might have

prevented certain league mergers, American courts as well as the Justice Department

298

have taken what sports economists James Quirk and Rodney Fort describe as a “hands- off position” regarding anti-competitive behaviors by sports leagues.3 Labor economists and lawyers have published extensively on how leagues limit the mobility and earning power of players through mechanisms such as amateur drafts and salary caps. While the emergence of players unions during the second half of the twentieth century placed considerable limits on these practices, leagues and their member teams continue to enjoy unchallenged monopoly power in other regards. For example, micro-economists have documented at length how the government’s sanctioning and/or indifference towards the cartel structure of professional sports, which allows leagues to unilaterally restrict the creation of new franchises, perpetuates an artificially high demand for teams in North

American cities.4 The “exclusive territorial franchise” granted to team owners by their respective leagues has not only shielded them from price competition, but has also made it easy for them to use the threat of relocation to extract massive public subsidies for new facilities (exactly as Reinsdorf did with the White Sox in the late 1980s).5

3 James Quirk and Rodney D. Fort, Hardball: The Abuse of Power in Pro Team Sports (Princeton, NJ: Princeton University Press, 1999), 134. Technically, baseball is the only sport that enjoys the exemption, but the official toleration of anticompetitive behavior had tended to extend to other major sports like football, basketball, and hockey. For a brief historical overview of baseball’s antitrust exemption, see Roger I. Abrams, Legal Bases: Baseball and the Law (Philadelphia, PA: Temple University Press, 1998).

4 Quirk and Fort, Hardball, 118.

5 The literatures on labor relations in professional sport and stadium construction are both expansive. Helpful overviews of both topics can be found in James Quirk and Rodney D. Fort, Pay Dirt: The Business of Professional Team Sports (Princeton, NJ: Princeton University Press, 1992). For introductory treatments of labor relations in particular, see Paul D. Staudohar, Playing For Dollars: Labor Relations and the Sports Business (Ithaca, NY: Cornell University Pres, 1996); Michael Leeds and Peter Von Allmen, The Economics of Sports (Boston, MA: Addison-Wesley, 2002); and Rodney Fort, Sports Economics (Upper Saddle River, NJ: Prentice Hall, 2003). Useful introductions to the politics of stadium development include Michael N. Danielson, Home Team: Professional Sports and the American Metropolis (Princeton, NJ: Princeton University Press, 1997); Roger Noll and Andrew Zimbalist, eds., Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums (Washington, D.C.: Brookings Institution, 1997); and Robert C. Trumpbour, The New Cathedrals: Politics and Media in the History of Stadium Construction (Syracuse, NY: Syracuse University Press, 2007). On sports and monopoly power in general, see Rodney 299

The work of these legal and economic scholars highlights the fact that, for most of

the twentieth century, leagues and teams have profited—with the help of the state—from

very deliberate efforts to restrict labor and franchise markets. It reminds us that the

professional sports industry has always embodied the contradictory tendency of the

American political economic order to flaunt “free market” ideology at the same time that

it welcomes regulation that decreases risk of private investment on the part of dominant

firms. Existing scholarship has, however, paid scant attention to relatively recent efforts

by teams to expand the reach of their monopoly power to concessions markets, and little

has been written about the local struggles over market access sparked by such efforts.

Recounting the battle over peanuts around the United Center helps to fill this void by

showing how the professional sports business profited from the resurgence of a culture of

corporate impunity in which monopolies and oligopolies simultaneously embrace “free-

market” dogma and government intervention, depending on which has the preferred

impact on their bottom line.6

To be clear, monopolistic practices were nothing new in the sports business when

Reinsdorf and Wirtz got rid of the vendors from the sidewalks around the arena.

However, the purge signaled more than a simple continuation of the privileged market

position for leagues and teams enshrined into law by the Supreme Court in the 1920s. It

marked a calculated—and some would say ruthless—effort to expand the boundaries of

franchises’ market dominance. Before the luxury arena and stadium boom of the late

Fort, “Market Power in Pro Sports: Problems and Solutions,” in The Economics of Sports, ed. Wiliam S. Kern (Kalamazoo, MI: Upjohn Institute for Employment Research, 2000): 7-19.

6 For comprehensive and intelligible accounts of these developments more broadly, see David Harvey, A Brief History of Neoliberalism (New York: Oxford University Press, 2005); James K. Galbraith, The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too (New York, NY: Free Press, 2008). 300

1980s and 1990s, independent concessions vendors remained outside the reach of teams’

monopoly power, and the predatory tactics used to remove them from venues like the

United Center signaled the creep of franchises’ market dominance beyond the realms of

players’ salaries and local franchise rights. This coincided with an increasing tendency

towards monopoly in both the national and global economies, which, according to

political economists John Bellamy Foster, Robert McChesney, and R. Jamil Jonna, “is

demonstrably stronger in the opening decades of the twenty-first century than ever

before.”7

The point about the broader tendency towards the consolidation of monopoly

power is an important one in the context of this story. It would be easy to assume the that

expansion of teams’ monopoly power into local concessions markets was yet another

case of special treatment of or indifference towards the sports business by government

regulators (or a direct result of the pre-existing monopoly power derived from that

treatment/indifference). This theory, however, leaves something to be desired. As I show

in more detail below, at the moment that they moved to crush the vendors, United Center

ownership clearly lacked the most important monopoly-based bargaining chip used by

leagues and teams to influence government (i.e. threats of franchise relocation). In fact,

the success of Reinsdorf and Wirtz in crushing the vendors owed more to the increasing

tendency of the courts to defer to the whims of capital regardless of the specific industry

in question, as well as the growing willingness of local governments to shield the

property of well-connected real estate investors inside and outside of the sports business

from competition.

7 John Bellamy Foster, Robert McChesney, and R. Jamil Jonna, “Monopoly and Competition in Twenty- First Century Capitalism,” Monthly Review 62, no. 11 (April 2011): 2. 301

Of Food Bans and ‘Free-Market’ Monopoly

In 1985, after a stint in the Peace Corps, Charlie Beyer returned to Chicago

without much of a plan. The only thing he knew for certain was what he didn’t want: a suit and a 9-to-5 job. So, pretty much on a whim, he decided to make a go of it as an independent peanut vendor on the sidewalks surrounding Wrigley Field. What Beyer

initially thought of as a temporary gig ended up lasting over a decade, during which he

sold peanuts and programs to fans outside of Wrigley, the old and new Comiskey Parks,

Soldier Field, and Chicago Stadium. His fondest memories deal with selling outside of

Wrigley because of the carnivalesque atmosphere created by the tight integration of the

ballpark into the surrounding neighborhood. Nevertheless, according to Beyer, the old

Chicago Stadium offered vendors the best access to potential customers relative to the

city’s other big-ticket sports facilities. “The thing about the Stadium was that it was the

most liberal of any of the places,” Beyer remembers, “there we were standing right by the

entrance doors at each of the gates. I still remember when I first saw that I went, oh my

goodness now this is amazing, being allowed to do this—this is incredible.”8

The other peanut vendors working the gates of Chicago Stadium tended to come

from socioeconomic backgrounds different from that of Beyer, who was white and college-educated. Most of fifty or so peddlers who sold peanuts were African-American.9

“People definitely saw me as a novelty,” Beyer recalled, “and people definitely said,

‘What are you doing out here’?” Most of the vendors weren’t simply avoiding the

8 Charlie Beyer, interview by author, September 2, 2011, transcript available from author upon request.

9 Ben Joravsky, “Warts and All,” Chicago Reader, October 11, 2007, http://www.chicagoreader.com/chicago/warts-and-all/Content?oid=926119. The figure of fifty total vendors is offered by Chinta Strausberg, “Beavers Tangles With Peanut Vendors,” Chicago Defender, September 28, 1995. 302

boredom of a white-collar desk job. They came mostly from poor neighborhoods on the

West and South Sides of Chicago. Some had few if any employment options aside from vending, some sold peanuts in order to supplement other wages, and in a few cases, the

vendors were elderly men who used the cash from their sales to pad meager social

security checks. Vendors could pull in a few hundred dollars before a game on a really

good night, and generally worked at multiple venues throughout the course of the year.10

In the late 1980s, structural shifts in the professional sports business began to

threaten the vendors’ position outside of Chicago’s stadiums and arenas. As economists

Roger Noll and Andrew Zimbalist point out, up until the 1980s, the vast majority of

revenues generated by pro teams came from ticket sales, “with minor additional amounts

collected from concessions, publications, and in-stadium advertising.” 11 However, things

began to change during the 1980s as teams focused their energies on transforming their

venues into all-inclusive entertainment zones for the minority of fans with the resources

to buy not just tickets, but a total experience that included gourmet food and limited

edition souvenirs. Revenues from in-venue concessions shot up for teams with new

facilities, as well as for teams that diversified their concessions operations in old arenas.

For example, in 1989, concessions revenues at the Charlotte Hornets’ new arena approached $4 million, more than five times the take at older venues like the Portland

10 Beyer, interview; Ben Joravsky, “Working for Peanuts,” Chicago Reader, October 12, 1995, http://www.chicagoreader.com/chicago/working-for-peanuts/Content?oid=888718. Despite efforts to identify and contact some of the African-American vendors, I was unable to do so. Given the precarious socioeconomic situation of the majority of vendors, most of them are not traceable through search engines or phone listings. Moreover, since many of the men were elderly in the early 1990s, it’s possible that several have passed away. Obviously, the fact that the only vendors that I interviewed were white and relatively stable economically means that the first-hand perspectives collected in my research are not necessarily representative of the vendors as a whole.

11 Roger G. Noll and Andrew Zimbalist, “ ‘Build the Stadium—Create the Jobs,’ ” in Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums, ed. Roger G. Noll and Andrew Zimbalist (Washington, D.C.: Brookings Institution Press, 1997), 8. 303

Coliseum.12 By the 1990-91 season, years before the United Center opened, Bulls fans

already had to fork over a significant chunk of change if they wanted to buy food, drink,

and souvenirs inside the stadium. Based on numbers tabulated by Team Marketing Report

for that season, a family of four could expect to spend between $90 and $100 on a

standard package of concessions at a Bulls game.13 Moreover, while reliable numbers on concessions revenues are hard to come by, data provided by Financial World magazine shows that arena revenues for the Bulls and Blackhawks, of which concessions sales made up a significant chunk, skyrocketed after the United Center opened (see Table 2.2).

In cities like Boston, Chicago, Denver, and Pittsburgh, the new high-stakes

concessions sales sparked efforts by stadium owners to eliminate competition from

independent street peddlers.14 Vendors in Chicago first started feeling the squeeze of

anti-peddling policies outside of Wrigley field in 1988, right after the Cubs installed

lights and began playing a limited schedule of night games, increasing the surrounding

neighborhood’s cachet as a trendy hangout. Soon after Wrigley’s lights went on, the local

alderman mounted a public campaign against the vendors, claiming that they were

“harassing” Cubs fans. By 1990, the City Council had passed an ordinance barring the sale of concessions on public streets and sidewalks in the ward containing Wrigley. Some

12 Quirk and Fort, Paydirt, 164-65.

13 Since the 1990-91 NBA season, Team Marketing Report has tabulated data on average ticket prices and the “fan cost index” (the combined cost of four average-priced tickets, two beers, four soft drinks, four hot dogs, two programs, and two of the least expensive caps). The difference between the fan cost index and the cost of four tickets for the 1990-91 (i.e. the cost of concessions only) was $93.34. Data from Team Marketing Report has been compiled into a centralized online database by University of Michigan sports economist Rodney Fort. See Rodney Fort, “NBA Fan Cost Index,” Rodney Fort’s Sports Business Data, accessed November 22, 2011, http://rodneyfort.com/SportsData/NBA/NBAFanCostIndex/NBAFCI.html.

14 Tom Barnes, “Stadium Vendors Report Brisk Business: Ordinance Restricting Novelty Sellers Outside Boosts Union Sales Inside,” Pittsburgh Post-Gazette, December 21, 1995, LexisNexis Academic; “Fenway Squeeze Play,” Boston Globe, December 18, 1998, ProQuest; Kevin Simpson, “Game-day Vendors Singing Blake Street Blues,” Denver Post, April 9, 1996, ProQuest. 304

street vendors managed to carve out spots on private property around the stadium, but the

ordinance initiated a gradual purge of those who weren’t so lucky.15

While the vendors continued to work the gates of Chicago Stadium during the late

eighties and early nineties, other venues in the city shut them out. In 1993, two years after

the new Comiskey Park opened on Chicago’s South Side, the City Council passed an

ordinance that banned all forms of peddling on public property within 1,000 feet of the

facility. Local officials alleged that the vendors presented a safety hazard by impeding

foot traffic.16 As Beyer remembers it, the purge at Comiskey happened much less

gradually than at Wrigley. The vendors’ only recourse was to try to sell peanuts to cars

exiting the nearby off-ramps of the Dan Ryan Expressway—a situation that presented a

genuine safety hazard, and which, according to Beyer, produced far fewer sales. By the

end of 1993, peddling around Comiskey was finished.17 Soldier Field, home of the

Chicago Bears, came next. In April 1994, under pressure from downtown businesses

intent on eliminating competition during World Cup matches held at Soldier Field, the

City Council created a no-peddling zone encompassing most of the Loop and Near South

Side, an area that included the historic football stadium.18

When the City Council initiated the purge from the sidewalks in the Loop and

around Soldier Field, the United Center was only a few months away from opening, and

15 Ray Hanania, “Ald. Hansen Tell Wrigley Peddlers to Take a Hike,” Chicago Sun-Times, September 14, 1989, NewsBank; Fran Spielman, “Wrigley Area Vendors Lose—Council Bars 44th Ward Street Peddlers,” Chicago Sun-Times, June 8, 1990, NewsBank. See City of Chicago, Chicago Municipal Code, 4-244-130, www.chicityclerk.com.

16 Robert Davis, “Council Might Throw Street Vendors a Curve,” Chicago Tribune, March 4, 1993, Proquest. See City of Chicago, Chicago Municipal Code, 4-244-145, www.chicityclerk.com.

17 Beyer, interview.

18 Robert Davis, “World Cup Spurs Peddler-Ban Vote,” Chicago Tribune, April 12, 1994, ProQuest. See City of Chicago, Chicago Municipal Code, 4-244-140, www.chicityclerk.com.

305

the vendors sensed that their days selling outside of Bulls and Blackhawks games were

numbered. Mark Weinberg, who sold an alternative fan program called The Blue Line

outside of Chicago Stadium before Blackhawks games, remembers the vendors who

peddled outside the other venues commenting on how they had been, in his words,

“fucked” by the various ordinances. They predicted that once the Bulls and Hawks

transitioned to the new facility, the teams would move to push them out.19 “The pattern

had already been established,” Beyer recalls. “Lights at Wrigley, vending ordinance; new

stadium at Comiskey, vending ordinance.”20 In their mind, it was only a matter of time.

The Bulls and Blackhawks proved the vendors right, but instead of an anti-

peddling ordinance, the teams instituted a ban on all outside food items in the United

Center immediately after it opened in 1994.21 The fact that the old Chicago Stadium allowed fans to bring in peanuts purchased outside, combined with the relatively cheap prices offered by street vendors, had ensured a steady stream of business for the peddlers before 1994. While some fans continued to purchase peanuts from the vendors and sneak them inside during the Bulls 1994-95 season, the food ban discouraged most of them, and

the peddlers’ revenues plummeted. Thornton Elliott, one of the elderly African-American men who peddled peanuts outside the arena, packed up for good not long after the ban went into effect. "I guess most fans figured, what's the use of buying peanuts if you have to sneak them in?,” Elliott told Chicago Reader reporter Ben Joravsky. “I used to make

19 Mark Weinberg, interview by author, August 7, 2011, transcript available from author upon request.

20 Beyer, interview.

21 Elliott v. United Center, No. 95 C 5440, 1996 U.S. Dist. LEXIS 1177 (N. Dist. Ill., East. Div. February 5, 1996). 306

$300 at a Blackhawks game. That first preseason game I made $40. The next game I

made $22. It wasn't worth it."22

Because he peddled programs rather than peanuts, the food ban did not cut into

Weinberg’s sales the way it did those of the peanut vendors. Nevertheless, the ban

seriously irked Weinberg, who viewed it as Reinsdorf and Wirtz “stepping on people who were powerless.” Weinberg was even more of an anomaly among the vendors than

Beyer. A Jew from Highland Park—the same affluent North Side suburb where

Reinsdorf lived—Weinberg graduated from law school at the University of Chicago, and went to work for Katten Muchin Zavis, a high-powered Chicago law firm.23 Uneasy

about working within the Chicago establishment, however, he walked away from the firm

to pursue what, by that time, had morphed into an all-consuming passion: lambasting the

dismal performance of Chicago Blackhawks management and in particular the

questionable business practices of owner Bill Wirtz. In 1991, Weinberg started

publishing The Blue Line, an underground program containing spoof advertisements and

lurid, merciless satires of Wirtz. The topics ranged from Wirtz’s alleged alcoholism to

accusations of financial deceit levied against him by close friends and family. After the

food ban took effect at the United Center, one issue of The Blue Line listed the “Top 10

Reasons Why I, King Bill, Have Banned Peanut Sales.” Among them: “If those homeless

peanut vendors make too much money, they might build their own stadium and buy their

22 Joravsky, “Working for Peanuts.”

23 Coincidentally, Allan Muchin, one of the firm’s partners, is also a limited partner and board member in the Bulls franchise. 307

own hockey club and then where would I be?” Another program featured a cartoon

depicting Mr. Peanut handcuffed, escorted at gunpoint by arena security (Figure 5.1).24

Figure 5.1. Mr. Peanut Gets the Boot from the United Center. Source: The Blue Line, c. October 1995. Courtesy of Mark Weinberg and Blue Line Publishing.

Weinberg’s response to the food ban didn’t stop there. Even though fans could

still bring The Blue Line into the United Center, he couldn’t stomach the fact that a fellow

Jew like Reinsdorf would stomp out the livelihoods of a group of men trying to scrape

by. “You know the Jews were peddlers,” Weinberg explains. “That’s what the Jews did

when they came over on the boat…The powerful interest [pushing out the peddlers] in

this case is ironically a wealthy Jewish man named Jerry Reinsdorf, whose grandparents

24 Mark Weinberg, Career Misconduct: The Story of Bill Wirtz’s Greed, Corruption, and the Betrayal of Blackhawks’ Fans (Chicago, IL: Blue Line Publishing, 2000), 125. 308

were probably peddlers.”25 So, in September of 1995, after convincing eighteen of the

peanut vendors who had worked outside of the United Center to sign on as plaintiffs,

Weinberg filed suit against United Center ownership, alleging that the food ban

constituted a violation of the Sherman Antitrust Act’s provisions against “predatory”

monopolization. The suit called for a preliminary injunction against the ban and

demanded that the United Center pay damages to cover what vendors claimed amounted

to over half a million dollars in total income.26

The success of the plaintiffs’ suit depended on more than simply proving that the

United Center had established a monopoly on food concessions, since, according to the

Sherman Act, the possession of a monopoly by a particular firm does not in and of itself

warrant intervention. To warrant legal action, a monopolist must be guilty of

“maintain[ing] or enhance[ing] monopoly power improperly” through “exclusionary,

anticompetitive, or predatory conduct.” In other words, the U.S. government has accepted

the existence of monopolies so long as they result from “fair” competition in which one firm comes to dominate a particular market by offering a product that consumers prefer to that of competitors, rather than by using coercive methods such as political favors or collusion. The government sanctions the former type of monopoly as “innocent.”27

Moreover, the lack of precise guidelines for what constitutes “improper” monopolization

has historically given judges a lot of room to support seemingly anti-competitive business

25 Weinberg, interview.

26 “Peanut Vendors Sue United Center,” Chicago Tribune, September 23, 1995, ProQuest; see Elliott, 1996 U.S. Dist. LEXIS 1177. On the rationale for the amount of damages demanded by the plaintiffs, see Weinberg, Career Misconduct, 44-45.

27 Quoted definitions are taken from the introduction of Elliott, 1996 U.S. Dist. LEXIS 1177. For the specific language of the legislation, see “Monopolies and Combinations in Restraint of Trade,” U.S. Code, Title 15, retrieved from http://www.law.cornell.edu/uscode/15/usc_sup_01_15_10_1.html. 309

practices. This explains in large part why, as historian Ellis Hawley explains, “the great

era of business consolidation, the years from 1897 to 1904, came [immediately] after the

Sherman Act and not before.28

Weinberg and the plaintiffs argued that the monopoly on concessions established

by the ban was not “innocent” since it deliberately established a barrier to entry that had

nothing to do with consumer preference. They argued that the monopoly had in fact

harmed consumer welfare by preventing Bulls and Blackhawks fans from taking part in

the longstanding “tradition” of purchasing peanuts on their way to games. They also

pointed out that the arena constituted an “essential facility” for the sale of peanuts in

Chicago. Sherman prohibits proactively denying a competitor use of a facility—even in the case that the firm denying access owns the facility—“that cannot reasonably be duplicated and to which access is necessary if one wishes to compete.” Weinberg and the plaintiffs insisted that the United Center qualified as such a facility, and by extension that the owners were prohibited from taking direct or indirect measures impeding vendors’ access to United Center patrons. Initially, they appeared to be on strong footing regarding both claims. It seemed clear enough that the vendors had gone out of business not because of their inability to offer a competitive product, but rather because of a United

Center policy that erected an artificial barrier between the peddlers and fans. Moreover, precedent already existed for treating sports arenas as essential facilities. Coincidentally,

Wirtz’s father, the previous owner of Chicago Stadium, lost an antitrust case in the early

1980s for denying the Bulls use of the arena after a business rival purchased the

28 Ellis W. Hawley, The New Deal and the Problem of Monopoly: A Study in Economic Ambivalence (Princeton, NJ: Princeton University Press, 1966), 6. 310

basketball team in 1972 even though Chicago Stadium was the only facility in the city at

the time that could accommodate a professional basketball franchise.29

Despite the seeming strength of the vendors’ claims, Rebecca Pallmeyer, the U.S.

district court magistrate judge who first considered the suit in February of 1996, denied

the request for a preliminary injunction and, in turn, rejected each of the legal rationales

offered by Weinberg and the plaintiffs. According to Pallmeyer, the ban did not single

out peanut vendors in a predatory fashion, since it applied to “food” in general rather than

peanuts alone. With regard to the “essential facilities” argument made by Weinberg,

Pallmeyer insisted that she found no “reason to conclude that, regardless of the popularity

of peanuts at the game, professional sports games are the only places that peanuts can be

sold or consumed.” In theory, she reasoned, the vendors could sell their snacks in other,

unspecified locations within the city.30

Diane Wood, one of the two judges who subsequently upheld Pallmeyer’s findings when the case reached the Seventh Circuit Court of Appeals in 1997, added that since the United Center announced that it would not sell peanuts inside, Reinsdorf and

Wirtz were not actually engaged in the peanut market. “The United Center is obviously not monopolizing the market for peanuts,” Wood explained, “it is staying strictly out of the peanut business.”31 But even had the arena continued to sell peanuts, the courts

reasoned, the ban would be no different than the long-accepted practice of movie theaters

confiscating candy purchased outside. While both Pallmeyer and Wood acknowledged

29 Elliott, 1996 U.S. Dist. LEXIS 1177; Fishman v. Wirtz, Nos. 74 C 2814 and 78 C 3621, 1981 U.S. Dist. LEXIS 9998 (N. Dist. Ill. East. Div. October 28, 1981). Twelve years later, Wirtz’s father, Arthur, lost in court and was forced to pay damages to said rival, but by that time he had already successfully purchased the Bulls himself. See Weingberg, Career Misconduct, 20-22.

30 Elliott, 1996 U.S. Dist. LEXIS 1177.

31 Elliott v. United Center, No. 96-3002, 1997 U.S. App. LEXIS 27221 (7th Cir. October 3, 1997). 311

that the ban posed real difficulties for the peanut peddlers, they agreed with the defendants’ attorneys that these hardships constituted a non-discriminatory outcome of the team owners’ “legitimate desire to maximize profits” through “operating the United

Center as a business.”32

Even if the opinions written by Pallmeyer and Wood made sense in the abstract, the assumptions underlying them bordered on the preposterous. In particular, Pallmeyer’s suggestion that “access to United Center fans is simply not essential to peanut sales” exemplified the dissonance between her legal reasoning and the material reality faced by the vendors. In theory, the peanut vendors—most or all of whom were licensed through the city—had the ability to set up shop on any public street corner in Chicago. But as the plaintiffs argued, the tradition of vending peanuts outside of sporting events meant that there was no conceivable way that Chicagoans passing a random street corner constituted a “market” comparable to hungry basketball and hockey fans.33 Unlike a convenience store near the arena, which could plausibly survive despite the food ban since its customer base would extend beyond United Center patrons, the vendors’ depended on a market made up exclusively of sports fans walking into the arena. The fact that vendors like Thornton Elliott quit the enterprise altogether after the ban went into effect threw this into sharp relief. Perhaps access to United Center ticket holders was not “essential’ to sell a bag of peanuts on a random street corner, but the vendors absolutely needed this access in order to sell enough inventory to make a living. Needless to say, neither Pallmeyer nor

32 Elliott, 1996 U.S. Dist. LEXIS 1177. Since Pallmeyer heard the case as a magistrate judge, another U.S. District Court Judge had to uphold her opinion before the case could make its way to a circuit court of appeals. District Court Judge James Holderman did so in July 1996 (magistrate rulings serve as a sort of initial screening in the District Court system). See Elliott v. United Center, No. 95 C 5440, 1996 U.S. Dist LEXIS 9846 (N. Dist. Ill. East. Div. July 15, 1996).

33 Elliott, 1996 U.S. Dist. LEXIS 1177. 312

the Seventh Circuit judges identified a specific market within Chicago with a comparable

customer base for the vendors.

The notion that the food ban failed to meet the standard of predatory business

practices laid out by Sherman because it did not specifically target peanuts, but rather

“food” in general, also proved a stretch. Pallmeyer’s opinion noted that “the policy not only discourages peanut sales; it also discourages new business that might cater to hungry

Bulls fans—popcorn vendors, hot dog stands, doughnut shops, and convenience stores are a few examples.”34 Putting aside the fact that doughnuts have never been the game-

time choice of American sports fans, this logic ignored the particular history of the

concessions market around the old Chicago Stadium. Justice Wood acknowledged that

“peanuts are the only food sold directly outside the United Center to United Center

patrons.”35 Neither the courts nor the defendants offered any evidence to suggest that the food ban would have an impact on any other vendors or local businesses, and anyone

who regularly attends sporting events knows that peanuts have enjoyed special popularity

because fans can tote them through the gate and to their seats with much more ease than

other common fan favorites like hot dogs and cotton candy. Looking back, the examples

used by Pallmeyer to suggest that a victory for the vendors would set some sort of viral

precedent for the larger community of food concessionaires proved laughable. In what

she intended as a rhetorical coup de grace, she asked, “if the only French restaurant in a

small town prohibits patrons from bringing their own wine, would a purveyor of fine

wine have cause for action?” The problem with this question, as the plaintiffs pointed out,

34 Elliott, 1996 U.S. Dist. LEXIS 1177.

35 Elliott, 1997 U.S. App. LEXIS 27221. 313

was that there existed no historical precedent involving particular wine distributors

catering to a particular local market of restaurant-goers.36

Pallmeyer, Wood, and the other judges hearing the case also agreed that since

Reinsdorf and Wirtz decided not to sell peanuts inside the United Center, they could not

be accused of monopolizing the peanut business. By this reasoning, the monopoly over

the concessions market resulted from a combination of “historic accident” and “business

acumen,” rather than “improper” predation over competitors.37 Weinberg and the vendors

tried to pre-empt this reasoning by designating the market in question as that for “food

concessions” in general rather than peanuts alone. The judges pushed this aside, ignoring

the fact that customers who previously purchased peanuts outside the arena now either

had to go without food during games or satisfy their cravings by purchasing a different type of snack inside the United Center.38 It is impossible to determine which outcome

predominated, but it seems safe to say that the latter occurred with some frequency. Even

if, as Wood claimed, the team owners “stayed strictly out of the peanut business,” the fact

that they remained squarely in the larger concessions market meant that the ban helped

them absorb business previously competed for by the vendors. In the end, the courts sent

the message that the owners’ desire to maximize profits by any means necessary trumped

vendors’ right to compete in a market where consumers still wanted their wares.39

36 Elliott, 1996 U.S. Dist. LEXIS 1177.

37 Elliott, 1997 U.S. App. LEXIS 27221.

38 See Weinberg, Career Misconduct.

39 One of the biggest ironies of this case and its outcome is that, in 1992, the Seventh Circuit Court of Appeals decided in favor of Reinsdorf when he brought an antitrust case against the NBA in response to league rules which limited the number of Bulls games that could be broadcast nationally by Chicago superstation WGN. In other words, Reinsdorf was profiting by bringing an antitrust case against someone else at the same time that he was deflecting legitimate cases brought against him by opponents. Even 314

This small story—literally peanuts—was about something much bigger. The

legally sanctioned impunity of owners like Reinsdorf and Wirtz coincided with a shift

within the American judiciary characterized by a reversion after 1970 to the defense of

monopolists’ “freedom” to maximize profits at the expense of competitors, employees,

and consumers. As legal scholar Rudolph Peritz notes, pre-New Deal enforcement of federal competition policy tended to favor efforts by business to crush organized labor. In the decades following passage of the Sherman Antitrust Act in 1890, judges used antitrust law primarily as a means of “protect[ing] the property of ‘individual’ employers from threatening ‘hordes’ of employees,” treating unions as a restraint on trade and rejecting complaints by workers about the anti-competitive practices of dominant firms.40 For example, in 1894 the federal government invoked the Sherman Act as a pretext for breaking the Pullman strike, and late in 1908 an employer targeted by a secondary union boycott won damages in the Supreme Court on the basis of anti-trust law.41 The few anti-

business rulings that actually stuck, such as the one that ordered the breakup of Standard

Oil in 1911, proved isolated concessions to public outcry rather than trend-setting

decisions. With the onset of the First World War and the government’s increasing support

of trade associationalism among business, the tendency among policymakers to turn a

blind eye towards anti-competitive behavior increased, as did the related belief in

though the Supreme Court denied to hear the case, the NBA later used some circuitous legal maneuvering to threaten Reinsdorf’s right to unlimited national broadcasts of Bulls games via WGN, and the two parties eventually reached a compromise that allowed for unlimited local broadcast of Bulls games via WGN in Chicago and the broadcast of a limited number of games on national cable. See Elliott Harris, “Bulls, NBA, WGN End Long Battle,” Chicago Sun-Times, December 13, 1996, NewsBank; Franklin Fisher, Christopher Maxwell, and Evan Sue Schouten, “The Economics of Sports Leagues—The Chicago Bulls Case,” Marquette Sports Law Journal 10, no. 1 (1999): 1-22.

40 Rudolph Peritz, Competition Policy: History, Rhetoric, Law (New York, NY: Oxford University Press, 2000), 12.

41 Edward Herman, “A Brief History of Mergers and Antitrust Policy,” in Daniel Fireside et al, eds., Real World Micro, sixteenth ed. (Boston, MA: Economic Affairs Bureau, 2009), 81, 315

monopoly power as the centerpiece of an efficient and profitable industrial economy. In

this context, “it was not private property rights but rather the ‘public interest’ that

required restraint,” and so antitrust action against concentrated capital remained mostly a

fantasy of activists convinced that “the new industrial and financial empires amounted to

a gross perversion of the American dream.”42 According to economist Edward Herman, by the 1920s pro-business forces in the federal government had “virtually ended anti-trust

enforcement.”43

The carte blanche enjoyed by monopolists eroded somewhat as a result of the

Great Depression. Widespread economic suffering and the failure of price controls to

stimulate the economy fueled an emerging consensus that the right to unrestrained

profitability should not trump the majority’s interest in economic equality, as well as the

belief that “citizens should be able to call upon political processes to referee fairness in

economic relations [and] to free them from the oppressive effects of private collectives

with great economic power.”44 While the onset of the Second World War and the return

to a planned wartime economy stymied the most proactive efforts by the Roosevelt

administration to check the continued growth of monopoly power, the postwar emphasis

on driving growth through widespread access to consumption (at competitive prices) led

the federal government to maintain a relatively adversarial stance towards corporate

concentration. Between the end of the Second World War the late 1960s, it was not rare

for courts to block horizontal mergers viewed as inimical to consumer welfare, though on

the whole antitrust enforcement failed to stymie the steady increase in large firms’ market

42 Peritz, Competition Policy, 58.

43 Herman, “A Brief History,” 82.

44 Peritz, Competition Policy, 113. 316

share during the immediate postwar period. Nevertheless, Herman insists that, when

compared to the first half-century of competition policy in the U.S., the “mildly

progressive enforcement” of antitrust law that characterized the twenty-five years

following World War II constituted a “golden age” of competition policy.45

To be sure, this “golden age” was far from revolutionary, as federal judges in the

quarter century after the war refrained from sweeping anti-monopoly action and often repeated longstanding beliefs that market domination signaled just reward for good business acumen. Moreover, the punishments meted out by the courts for allegedly anti- competitive, monopolistic action rarely had much of an impact, either because they lacked teeth (in the case of paltry fines, for example) or because they left open other avenues for business to accrue additional power (e.g. by not banning vertical mergers of companies operating in different industries).46 However, relative to their pre-New Deal predecessors, the postwar courts proved more willing to entertain the possibility that market domination could pose legitimate problems for the public. One of the most illustrative examples of this break had to do with the postwar courts’ concern over

“coercion”: the use of extra-market (i.e. non-economic) strategies or “grossly unequal bargaining power” to force the hand of consumers, competitors, or small businesses. For example, in cases like Klor’s v. Broadway-Hale Stores (1959) and Simpson v. Union Oil

(1964), the courts rejected the legality of efforts by monopolists to dictate the specific terms on which local retailers could sell their (i.e. the monopolists’) products, and

45 Herman, “A Brief History,” 82. Herman points out that one reason why increased enforcement had such a negligible effect on the concentration of economic power within single firms was that when courts blocked horizontal mergers, companies often responded by acquiring firms in other industries (i.e. by practicing vertical integration).

46 Herman, “A Brief History,” 82. 317

generally defended the rights of small-business owners to operate independently of larger firms. Even though this tendency often took the form of judges’ antiquated appeals to

Jeffersonian democracy, it signaled that the nation’s highest legal institutions had started to take seriously the need to place limits on the political and economic power of private firms.47

The economic crises of the early 1970s provided an opening for reactionary critics

of postwar competition policy to push the pendulum back towards the protection of

individuals’ “freedom” to maximize their personal wealth. A new vanguard of antitrust

scholars at the University of Chicago, most notably Richard Posner and Robert Bork,

began to popularize a set of theories about market competition that aligned seamlessly

with business’ assault on redistributive economic policy. Posner and Bork argued that

monopoly inherently represented the natural and legitimate outcome of “free market” competition since, according to their logic, market dominance inherently signaled consumer preference for the monopoly firm’s product. They also insisted that rather than

engendering artificially high prices, monopoly firms inevitably reduced costs by

streamlining production under a single entity, that barriers to entry represented a fiction

of progressives’ imagination, and that all markets remained open to competent

competitors.48 Ignoring a long history of coercive practices by monopoly firms, these

theorists assumed that monopoly necessarily represented the outcome of free-market

competition, and had nothing to do with the power of firms to influence policy decisions

for their own benefit. Thus, “the barriers to entry that constituted the basis of conceptions

47 Peritz, Competition Policy, 202-205.

48 The formal name for this logic is “contestable markets theory,” and its most notable academic supporter in the 1970s was William Baumol. For more on contestable markets theory, see Foster, McHesney, and Jonna, “Monopoly and Competition.” 318

of monopoly power were abolished by fiat at the level of pure theory.” 49 For Posner and

Bork, monopoly posed no threat to competition and even maximized “efficiency.” To their mind, any efforts by the government to interfere in the marketplace threatened individual “liberty” by placing limits on the ability of a person or firm to accumulate ad infinitum.50

As Foster, McChesney, and Jonna note, this exceedingly abstract interpretation exploited the “ambiguity of competition,” ignoring the “opposite ways in which the concept of competition is employed in economics and more colloquial language.”51

Posner, Bork, and their adherents within the emerging conservative American judiciary distorted the definition of “free market competition” offered by neoclassical economists who shared their commitment to wealth maximization. Milton Friedman, the high priest of American neoclassical economics, explicitly rejected the notion of “competition” as

“personal rivalry, with one individual seeking to outdo his known competitor,” insisting that “free” markets depend on a situation in which “no one participant can determine the

49 Foster, McChesney, and Jonna, “Monopoly and Competition,” 30.

50 Most accounts of the “neoliberal turn” underwritten by these ideological shifts situate it as a declension from New Deal reforms and the quarter century of sustained growth that followed the Second World War, during which low unemployment and high levels of union membership underwrote a relatively broad distribution of wealth (at least for white people). But because they generally take the immediate postwar period as their starting point, proponents of this narrative tend to underplay the degree to which the postwar boom represented an exception within the history of American capitalism, and by extension the degree to which the renewed offensive by capital initiated in the 1970s represented a return to business as usual. Undoubtedly, the character of both domestic and global accumulation had changed—most notably as a result of expanded financialization—but in terms of the relative positions of capital and labor, the broad outlines of the situation betrayed an eerie resemblance to the one that existed in the nineteenth and early twentieth centuries. As political economist David McNally explains, the postwar boom from 1948-1973 “ought not to be the benchmark against which everything else is deemed a ‘crisis.’ [That] great boom was the product of an exceptional set of social-historical circumstances…prolonged expansion with rising levels of output, wages and employment is not the capitalist norm.” See David McNally, Global Slump: The Economics and Politics of Crisis and Resistance (Oakland, CA: PM Press, 2011), 38.

51 Foster, McChesney, and Jonna, “Monopoly and Competition,” 13. 319

terms on which other participants shall have access.”52 In other words, for Friedman,

monopoly was the legitimate outcome of freely competitive markets only if it resulted

from the merit of a firm’s product and the efficiency of its production practices, but not if

it resulted from active efforts by the firm to sabotage its competitors. By contrast, the

Chicago School legal theorists arbitrarily expanded their definition of “competition” to

include the latter, positing an “anything goes” view of the marketplace.53

It would be an oversimplification to argue that the Chicago School’s stance on

antitrust was politically regressive just because it embraced the persistence of large firms

that could dominate production in a particular market, and that the postwar paradigm that

it replaced was more progressive simply because it often viewed these large firms as a

potential threat to economic freedom. Economist Joseph Persky points out that despite

popular conceptions to the contrary, even economists on the left have failed to reach a

consensus as to whether or not “big” inherently equals “bad,” especially when it comes to

the debate over economic efficiency.54 Scholars like James Livingston insist that,

contrary to the pronouncements of die-hard anti-monopolists, “larger enterprises are almost always more efficient than small business because they can impose a division of labor—because they can divide tasks, make people specialize and so increase outputs without increasing inputs of capital or labor.” Livingston argues that the tendency of many on the left to overlook this fact stems from the endurance of empirically

52 Milton Friedman, Capitalism and Freedom (Chicago, IL: University of Chicago Press, 1962), 119.

53 For the purposes of this essay, “Chicago School” refers specifically to the cadre of legal theorists led by Posner and Bork. While the political motivations of these theorists overlapped a great deal with those of the “Chicago School” of economics that rose to prominence during the same period, there were some notable theoretical divides between the two groups. For more on this, see Foster, McChesney, and Jonna, “Monopoly and Competition.”

54 Joseph Persky, “Lange and Von Mises, Large-Scale Enterprises, and the Economic Case for Socialism,” Journal of Economic Perspectives 5, no. 4 (Fall 1991): 231. 320

unsupported anti-monopoly positions articulated by turn-of-the-century Populists, and that such acceptance too often bleeds into ignorance of the fact that small businesses often produce their own inequities such as unpaid family labor.55

Even if we accept Livingston’s argument, however, we also have to keep in mind that the Chicago School’s new doctrine on competition policy had to do with much more than protracted economic debates about the relationship between firm size and efficiency.

In encouraging a framework that sanctioned predatory and coercive activity as part of legal “competition,” scholars like Bork and Posner endorsed an economic model in which political power played as much or more of a role in a firm’s success than things like efficiency and production quality. Within this model, large firms with the capital necessary to influence political and judicial decision-making did not have to best competitors by developing better manufacturing processes or offering up superior products and services. Instead, they could rely on strong-arm tactics—collusion,

preferential treatment from the judiciary, political lobbying, etc.—to ensure that they

never had to risk being out-competed in a genuinely free market.

By the 1980s, the reactionary positions of the Chicago School had gained wide

purchase within the American judiciary, and large firms had amassed small armies of

economists and lawyers to assist in mounting antitrust defenses. Ronald Reagan and

George Bush “aggressively dismantled” antitrust enforcement by cutting funding for the

Justice Department’s Antitrust Division and replacing its leadership with cronies

sympathetic to the Chicago School. On the whole, the gutting of antitrust enforcement

continued under Clinton, despite the high-profile case against Microsoft during the

55 James Livingston, Against Thrift: Why Consumer Culture is Good for the Economy, the Environment, and Your Soul (New York, NY: Basic Books, 2011), 20-21. 321

nineties. According to Herman, merger transactions approved by the U.S. government during 1997 alone amounted to over $1 trillion.56 For all intents and purposes, by the time the peanut vendors took their case to court, the American legal and political establishment viewed antitrust policy as an anachronism.

Unfortunately for the vendors, some of the country’s most ardent defenders of the

Chicago School sat on the Seventh Circuit Court of Appeals. In fact, Posner himself served as Chief Justice of the court during the period that the vendors filed both the initial suit and their appeals. And while Posner did not weigh in on the peanut case, the judges who did replicated his reasoning in equating actions that clearly violated Friedman’s notion of “free- market” competition with smart business practices as opposed to predatory manipulation of the marketplace. For Pallmeyer and Wood, the fact that the food ban served the economic interests of the United Center was enough to conclude that it had been instituted for “valid business reasons.”57 Since, in their mind, protecting market ‘freedom’ proved synonymous with protecting individual firms’ ability to maximize their wealth, there was little that the arena owners could do that would violate antitrust law, provided that whatever they did padded their bottom line.

Not surprisingly, Pallmeyer, Wood, and the other District and Circuit Court judges who heard the case did their best to avoid the issue of consumer welfare, since it would have been hard to contend with the argument that fans who wanted to buy peanuts outside the United Center were being disadvantaged not only by being deprived of a product that they wanted, but also by having to replace it with more expensive

56 Herman, “A Brief History,” 82.

57 Elliott, 1996 U.S. Dist. LEXIS 1177.

322

concessions from inside the arena. The fact that some fans tried to sneak peanuts into the

arena even after the ban went into effect proved that the vendors’ disappearance had little

to do with the internal workings of the concessions market (i.e. a sudden drop-off in

demand). In stark contrast to the theory of the Chicago School antitrust scholars, the

United Center’s monopoly power did not represent the outcome of consumer preference

for the outrageously priced concessions available inside. At one point in her opinion,

Pallmeyer flippantly noted that, “to the court’s knowledge, the unavailability of peanuts

has not, in this amazing basketball season, apparently deterred attendance at Bulls

games.”58 This simply avoided the question at hand since the vendors had not argued that the food ban harmed consumer welfare within the market for tickets; their suit dealt specifically with the market for food concessions in and around the arena. The effort to equate the high spirits of Bulls fans in general with the impossibility of predatory

business practices on the part of United Center ownership, like the rest of the judicial

reasoning applied to the vendor issue, signaled that the courts refused to conceive of such

a profit-generating entity as anything but a marvel of “free market” competition.

The treatment of the vendors’ suit by the courts encapsulated the larger transition

within the American judiciary back to the more or less unconditional commitment to

helping “those in the business community to assert their interests,” and to ensuring that

appeals for economic justice no longer threatened firms’ alleged “right” to unlimited

profits.59 Judges sanctioned the business practices of Reinsdorf and Wirtz under the

increasingly dominant assumption that the unregulated concentration of economic power

represented a natural, efficiency-maximizing, and generally beneficial result of “free

58 Elliott, 1996 U.S. Dist. LEXIS 1177.

59 Peritz, Competition Policy, 265. 323

market competition,” even though their definition of “competition” contradicted that of economists who allegedly shared the same commitment to unfettered accumulation. The courts thus played a central role in the owners’ efforts to expand their monopoly power into new markets. It’s important to reiterate in this regard that this sort of behavior on the part of the courts was not unique to cases involving the professional sports business; it was the predictable outcome of a structural shift in the judiciary’s approach to the issue of monopoly power.

Unfortunately for the vendors, the courts’ compliance in sanctioning Reinsdorf and Wirtz’s efforts to shore up their monopolization of concessions represented only one piece of a larger system of state support for the United Center’s market domination. As the history of municipal politics around the arena demonstrates, the team owners would prove much less allergic to government intervention in concessions markets when such intervention strengthened their own market position.

The 1,000-Foot Ordinance: State Intervention as Risk Reduction for “Free-Market” Monopoly

The ultimate outcome of the vendors’ suit remained in question until the U.S.

Supreme Court refused to hear an appeal by the plaintiffs in March 1998.60 Faced with a potentially protracted legal struggle and some uncertainty as to whether or not the vendors might eventually stumble across a sympathetic judge during the appeals process,

Reinsdorf and Wirtz solicited the help of local officials to ensure that the vendors could never return, regardless of the ultimate outcome of the antitrust suit. In September 1995, just days after Weinberg and the vendors filed their initial suit, Walter Burnett, Jr., the newly elected alderman of the 27th Ward (which contained the United Center) introduced

60 See Elliott v. United Center, No. 97-1188, U.S. Sup. LEXIS 1866 (March 23, 1998). 324

an ordinance banning licensed street vendors from within 1,000-ft of the arena. As in the case of the new Comiskey Park, arena ownership and city officials cited pedestrian

“congestion” and concerns over vendors forcing fans to walk in the street, and the City

Council promptly passed the ordinance.61 While Weinberg and Beyer tried to organize

the vendors to place pressure on the City Council to reverse the decision, their efforts

quickly stalled. The passage of the ordinance meant that, even if the courts struck down

the food ban, the vendors would still be out of work, and Reinsdorf and Wirtz would

enjoy an indefinite and uncontested monopoly over all food and souvenir concessions in

and around the arena.

Of course, this was Chicago, where no political favor goes unpaid. Alderman

Burnett later described how the bill came into being. United Center officials, he said,

“tried to make it look like it wasn’t just greed…but it was clear from the beginning that

what they really wanted was the peddlers’ business…I’ve never been pushed so hard on

anything in my life.”62 In exchange for introducing the ordinance, Burnett asked that the

United Center offer concessions jobs in the arena to a few of his constituents. Reinsdorf

and Wirtz agreed to dole out the positions.63 And the favors didn’t stop there. Patrick

Huels, who served until 1997 as alderman of the 11th Ward (the ward containing

Comiskey Park) had personally introduced the 1,000-ft ordinance for the White Sox facility in 1993 despite a clear conflict of interest, since he owned a security firm on

Reinsdorf’s payroll. City Council records of the vote on the Comiskey ordinance suggest

61 Joseph Kirby, “Street Vendors Dealt Blow at United Center,” Chicago Tribune, September 28, 1995, ProQuest.

62 John Carpenter and Charles Nicodemus, “How City Hall Banned Vendors Near Arenas,” Chicago Sun- Times, January 11, 1998, NewsBank.

63 Walter Burnett, Jr., interview by author, August 29, 2011, transcript available from author upon request. 325

that Huels abstained from voting on the measure, but the Sun-Times reported that Huels

can be heard voting in favor of it on an audio recording of the meeting, his vote later

expunged from the record. When it came time for the City Council to decide on the

United Center ordinance, Huels, whose firm remained on Reinsdorf’s payroll, voted in

favor in committee and on the Council floor.64 Simply put, Huels put his political weight

behind ordinances with clear financial benefits for the Bulls and White Sox at the same

time that he was being paid by Reinsdorf. He eventually had to step down as a result of a

separate controversy, but Reinsdorf and Wirtz never received any form of reprimand for

their corrupt lobbying efforts.65

So, while the courts provided the United Center with antitrust immunity, local

politicians provided a legislative safety net that protected the owners’ interests in the

unlikely event that a rogue judge had the temerity to overrule the Seventh Circuit. The

ordinance also extended the scope of the existing anti-vending measures, since it affected

not only the peanut vendors, but also to those selling souvenirs outside of the United

Center. In the courts, Reinsdorf and Wirtz’s counsel maintained—and the judges

graciously accepted—that since the concessions monopoly resulted from “non-predatory”

(i.e. “free-market”) business practices, the government had no right to interfere.

However, when the vendors mounted a legal challenge, the team owners bribed local

officials to pass legislation ensuring that the vendors could not compete. This inconsistent relationship to the state’s regulation of market activity had everything to do with the fact

64 Carpenter and Nicodemus, “How City Hall Banned Vendors.”

65 Mayor Daley called for Huels’s resignation in 1997 after Huels received a $1.25 million dollar loan from a contractor who had secured over $1 million in city subsidies with Huels’s assistance. In the end, questionable as were his actions on behalf of the Bulls and the Sox, they had nothing to do with his eventual resignation. Fran Spielman and Pablo Martinez Monsivais, “Loopholes Undermine New Ethics Ordinance,” Chicago Sun-Times, October 19, 1997, NewsBank. 326

that, as the vendors argued in their antitrust suit, the United Center’s monopoly was not

“innocent.” It very clearly was not the outcome of Friedman’s “free market” competition, in which firms allegedly triumph over competitors by virtue of superior products and more efficient production. Rather, Reinsdorf and Wirtz recognized that, given fans’ preference to pay less for peanuts, the vendors posed a legitimate competitive threat, and that eliminating them would require more than engaging in the idealized vision of

“perfect” market competition envisioned by Friedman. Even the Tribune, the establishment mouthpiece of Chicago, had difficulty coming to terms with the contradiction. Lambasting the ordinance, the paper opined, “for examples of the sort of enterprise that economists extol and politicians praise, it would be hard to beat the men and women who sell peanuts…outside the United Center.”66

But the anti-peddling ordinance was not the result of local politicians’ inability to

recognize the competitive virtues embodied by the vendors. Rather, it was the predictable

outcome of local growth machine politics. Since the 1970s, municipal governments had

expanded efforts to insulate private investment in the built environment from risk through

mechanisms such as massive tax-breaks and the issue of municipal bonds to help with

private construction projects. In addition to these subsidies, local policymakers have

often created new sets of land-use rules to help commercial landholders physically

cordon off their property from competition. Laws like the anti-vending ordinance have helped investors in major entertainment or retail spaces to satisfy several development

“principles” aimed at maximizing rents while preventing any rents from leaking into the

hands of competitors. These include “enclosure, which separates [developments] from

their environment,” as well as “control, which synergistically maximizes returns from

66 “Don’t Push the Street Vendors Out,” Chicago Tribune, September 30, 1995, ProQuest. 327

internal spatial and social relations.”67 Ironically, as government has committed major

economic and legislative resources to protecting the interests of these investors, the

investors themselves have often backed austerity measures when it comes to social

service provision for the rest of society, justifying fiscal retrenchment with what David

Harvey has called, “a lot of rhetoric about individual freedom, liberty, personal

responsibility and the virtues of…the free market and free trade.”68 In practice, then, this

meant “one rule for the masses and another for elites,” and the history of the anti-

peddling ordinance around the United Center offers just one example of this double

standard in action.69

As Chapter Six explores in more detail, Reinsdorf and Wirtz’s decision to

privately finance the construction costs of the United Center with credit from

multinational banks was contingent upon a range of political strategies for ensuring that

they could pay off their loans while still turning incredible profits. From special tax

arrangements to extensive government assistance in removing vendors from the local

concessions market, the owners developed a business model that dramatically reduced

their exposure to the risk of market failure. In the case of the vending ordinance, this

model called for more than behind-the-scenes kickbacks; it demanded that the state take coercive action against a group of independent entrepreneurs who had more or less played by the rules of idealized free-market competition all along. The peddlers, who had

to pay the city for their yearly operating license, now faced fines of up to $200 and

67 Logan and Molotch, Urban Fortunes, 238.

68 David Harvey, The Enigma of Capital and the Crises of Capitalism (New York, NY: Oxford University Press, 2010), 10.

69 Johnna Montgomerie and Karel Williams, “Financialised Capitalism: After the Crisis and Beyond Neoliberlaism,” Competition and Change 13, no. 2 (June 2009): 101. 328

possible arrest if they braved selling their wares around the arena. They received no reduction in licensing fees despite the fact that the city had deemed their primary markets off-limits, and no doubt police were in ample supply on game nights to enforce the ordinance if need be.70 For all intents and purposes, then, the police patrolling the area around the stadium became a publicly funded security force tasked with enforcing an ordinance for the benefit of a private business. The ordinance thus captured not only the contradiction between corporate welfare and prevailing “free-market” ideology, but also the increasing tendency at the end of the twentieth century of dominant firms to “resort to coercive legislation and policing tactics” whenever something or someone has stood in the way of their efforts to maximize returns.71

While it is difficult to know the degree to which the anti-peddling politics of

United Center ownership contributed to increased returns on arena concessions, the ordinance and food ban certainly coincided with significant price hikes on items sold inside. According to data collected by Team Marketing Report, the cost of a typical basket of concessions for a family of four at a Bulls game (defined as 2 small beers, 4 small soft drinks, 4 regular hot dogs, parking for 1 car, 2 game programs, and 2 of the least expensive adult-sized hats) rose by more than eighteen percent (when measured in constant dollars) during the first five seasons of the United Center’s operation (see Figure

5.2). While correlation does not equal causation, it makes good sense that one of the effects of pushing the vendors out was to increase the demand for concessions inside, and

70 See City of Chicago, Chicago Municipal Code, 4-244.

71 David Harvey, Spaces of Global Capitalism: Toward a Theory of Uneven Geographical Development (New York, NY: Verso, 2006). 329

following this logic it seems reasonable to argue that the ordinance and food ban helped

Reinsdorf and Wirtz create a market conducive to price increases.

Chicago Stadium United Center

$95

$90

$85

$80 $1999 Dollars

$75

$70 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 NBA Season

Figure 5.2. Price for Typical Family Basket of Concessions at a Chicago Bulls Game, 1991-1999.a Source: Fort, “NBA Fan Cost Index.” Based on data from Team Marketing Report. a “Typical basket” defined as the sum of two small beers, four small soft drinks, four regular hot dogs, parking for one car, two game programs, and two of the least expensive adult-sized hats. Inflation adjustments made using the Bureau of Labor Statistics CPI-U for the Chicago Metropolitan Statistical Area.

As with the favorable treatment of the team owners by the courts, the help

provided them by local policymakers was not a benefit enjoyed exclusively by the pro

sports business. In the context of Chicago as a whole, the anti-peddling ordinances at

stadiums in the 1990s—the City Council passed all of the stadium and arena ordinances

between 1990 and 1995—constituted part of the Daley administration’s larger effort to

retool the Loop and surrounding neighborhoods as attractive sites of investment for the

330

“leisure and hospitality” industry discussed in detail in Chapter One.72 The massive flow

of investment intended to transform downtown into a world-class “cultural destination”

brought with it demands from the tourism industry for the city to foster a “business

climate” friendly to major firms. This meant making it impossible for small-time

competitors like street peddlers to access the throngs of tourists, suburbanites, and urban

yuppies making their way to the Loop for a day of culture and cuisine. As Map 5.1

shows, the anti-peddling ordinances at Chicago’s stadiums helped comprise a much

larger project during the 1990s of clearing vendors from neighborhoods and attractions

with a high volume of tourist traffic. This not only affected sites in or on the periphery of

the Loop like the Maxwell Street Market and the Field Museum, but also a cluster of

gentrifying North Side community areas like Lake View and Lincoln Square.

72 For helpful discussions of this process, see Larry Bennett, The Third City: Chicago and American Urbanism (Chicago, IL: University of Chicago Press, 2010); Costas Spirou, Urban Tourism and Urban Change: Cities in a Global Economy (New York, NY: Routledge, 2011). 331

Map 5.1. Selected Anti-Peddling Ordinances on Chicago’s North Side Passed During the 1990s. Source: Basemaps provided by ESRI. Shapefiles obtained from City of Chicago, Chicago Data Portal. Non- stadium anti-peddling ordinances mapped using street boundaries provided in City of Chicago, Municipal Code of Chicago, Section 4-244-140.

The transformation of Chicago’s municipal code into a staunchly anti-peddling

document marked a stark departure from the policies of the populist administration of

Harold Washington during the 1980s. According to the Tribune, Washington

“encouraged food vendors to set up their stands along the State Street Mall” and initiated

332

the licensing of local street entertainers.73 While some welcomed peddlers as a legitimate

part of Chicago’s street culture, Richard M. Daley saw them not just as pesky

competition for big business, but also as a threat to a growth-friendly image. In addition

to backing franchise owners’ war against food vendors, he waged a high-profile

campaign during the early 1990s against independent newsstand operators, many of

whom sold papers and magazines in the Loop. He claimed that it was his desire to “clean

the city” that led him to back the passage of a 1991 ordinance limiting the number of newsstands in the city and imposing steep licensing fees that put many existing stands out of business.74

It’s important to emphasize this larger movement against peddlers in order to

clarify that that the anti-vending ordinances at sports facilities did not necessarily result

from the special monopoly powers already commanded by the sports business. Given the

large amount of attention paid by scholars and journalists to the uniquely privileged

market position of teams, most especially with regard to exclusive franchise rights in

certain cities/regions, there is a temptation to chalk up stories like this to the government-

sanctioned cartel structure of leagues. That is, one might reason that cities have to give

teams whatever they want since they might leave (and if they left the respective league

would likely punish the abandoned city by blocking or delaying a new team from moving

there). Reinsdorf offered this very interpretation regarding his success in securing public

subsidies for a new stadium for the White Sox. According to him, “we had to make

73 Robert Davis, “Daily Life in Chicago is Far Different from Daley Life of Only a Decade Ago,” Chicago Tribune, December 7, 1986, ProQuest.

74 Fran Spielman, “Daley Backs Plan to Pull Permits on Newsstands,” Chicago Sun-Times, January 29, 1992, NewsBank; Robert Davis, “City Decides to Get Serious About Enforcing Newsstand Ordinance,” Chicago Tribune, May 15, 1992, ProQuest. 333

threats to get the new deal…If we didn’t have the threat of moving, we wouldn’t have

gotten the deal.”75

In the context of the peanut vendors around the United Center, this simply wasn’t

the case. Given the fact that the arena had just opened, the Bulls and Blackhawks were

not going anywhere, at least for a very long while; the unwillingness of local politicians

to pass an anti-vending ordinance would not have changed that. Put another way,

Reinsdorf and Wirtz didn’t need the aforementioned “threats” to cut a deal concerning

the vending ordinance; City Hall more or less handed them exclusive rights to

concessions during basketball and hockey games even though they lacked the sort of

serious leverage wielded by Reinsdorf during the White Sox debacle. The legislative

component of the vendor purge, then, was not so much an outcome of the intricacies of

the pro sports business as it was a manifestation of expanded efforts by local

governments to shield major players in the larger real estate industry from competition by

independent entrepreneurs.76 The ordinance certainly marked an intensification of the teams’ monopoly power, but this process did not depend on their position as sports

teams; it depended on their position as influential landholders.

Either way, Daley’s equation of pushing out the vendors with “cleaning” the city

suggests that the peddling bans around attractions like the United Center functioned as

75 Reinsdorf quoted in Charles Euchner, Playing the Field: Why Sports Teams Move and Cities Fight to Keep Them (Baltimore, MD: Johns Hopkins University Press, 1993), 134.

76 Not surprisingly, Wirtz’s liquor empire also benefited from state-aided efforts to protect monopoly power, some of which sparked enough consumer outrage to convince lawmakers to walk them back. For more, see Ray Long and Rick Pearson, “Springfield Success Stories,” Chicago Tribune, May 29, 1999, ProQuest; Ray Long and Joseph Hallinan, “Ryan Turns Back on Unpopular Liquor Law,” Chicago Tribune, January 24, 2000, ProQuest. For concurrent efforts by local government to protect other industries from competition, see “Thompson Still Helped by His Ties with Ryan,” Chicago Tribune, November 26, 1999, ProQuest.

334

more than a strategy for market domination. They also played an important role in

transforming the space around Chicago’s arenas and stadiums. As Charles Euchner

explains, during the 1980s and 90s team owners like Wirtz and Reinsdorf who owned

urban arenas or stadiums often had “an intense desire to get out of inner-city neighborhoods” in order bring their operations closer to what market studies indicated were increasingly suburban fan bases.77 In order to keep them from moving to the

suburbs, Chicago helped engineer massive public subsidy deals for new stadiums for

several of its teams. But once the teams secured the subsidy deals and committed to remaining in blighted areas within the city limits, they had to confront the economic reality that placing well-to-do white ticket holders in close proximity to poor neighborhood residents—especially poor black neighborhood residents—might not be

good for business. As urban planning scholar Robert Beauregard explains, poor blacks in

cities like Chicago “repelled” whites living in the suburbs and gentrified enclaves, who

looked fearfully on them as symbols of crime, moral laxity, and a “culture of poverty.”78

These issues were undoubtedly on the mind of Bulls and Blackhawks ownership,

as the United Center sat the middle of the impoverished West Side. As early as 1987, one

local community activist expressed the view that plans to renovate Chicago Stadium or

build a new sports facility on the Near West Side would include measures to “better

buffer fans’ parking from the negative elements within the Henry Horner Projects.”79 The

owners’ actions appear to have borne out this hypothesis, as they surrounded the United

77 Euchner, Playing the Field, 11.

78 Robert Beauregard, Voices of Decline: The Postwar Fate of U.S. Cities (Cambridge, MA, 1993), 173- 178.

79 Vernon Ford, A Draft Commentary on the Proposed Westside Stadium Site (sent to Robert Mier), May 1987, June 7, 1987, Box 17, Folder 5, Robert Mier Papers, Chicago History Museum, 36, 30. 335

Center with acres of surface parking so that, as urban planner Rachel Weber has noted, it

was “easy in, easy out” for fans coming in from the suburbs and the Loop (see Map 5.2).

Weber describes the facility as a “kind of fortress,” noting that the “sea of parking

lots…was intended to make suburban fans feel more ‘comfortable’.”80 In this context,

getting rid of the mostly black vendors was just another part of fortifying the parking buffer and, in the words of urban theorist Mike Davis, “ensur[ing] a seamless continuum of middle-class work, consumption, and recreation” in which white fans could watch

black players without having to interact with inhabitants of the African-American slum

surrounding the arena.81 As Beyer explains, vendors, especially black ones, “were seen as

riffraff, and so [the team owners wanted] to get rid of the riffraff…clean up…make [the

arena surroundings] spiffy clean.”82 This interpretation suggests that Reinsdorf and Wirtz

viewed the peddlers in much the same way that they viewed nearby public housing

residents—as an unsightly and discomfiting annoyance that needed to be removed or

made less visible. In this way, the ordinance satisfied another key “principle” of profit-

maximizing urban development: “protection, which ensures security for merchants and

customers.”83

80 Rachel Weber, interview with WBEZ Chicago, May 9, 2011, http://www.wbez.org/episode- segments/2011-05-09/.

81 Mike Davis, City of Quartz: Excavating the Future in Los Angeles (London: Verso, 1990), 212.

82 Beyer, interview.

83 Logan and Molotch, Urban Fortunes, 238. 336

Map 5.2. Geography of the Anti-Vendor Ordinance and United Center Parking. Source: Basemaps provided by ESRI. To determine the ownership status of the arena parking lots, the Property Index Numbers (PINs) assigned by Cook County to the associated parcels were cross-checked with local tax payment records available in hard copy at the Office of the Cook County Clerk. PINs determined using Cook County Assessor’s Office, CookViewer applet, http://cookviewer1.cookcountyil.gov/jsviewer/index.html. On Malcolm X lease, see Ben Meyerson, “Malcolm X College to Get New Building,” Chicago Journal, February 21, 2012, http://www.chicagojournal.com/blogs/near-loop-wire/02-21- 2012/Malcolm_X_college_to_get_new_building.

It appears that many of the African-American vendors understood their predicament in terms similar to those expressed by Horner residents who had gotten wind

of efforts by United Center ownership and the city to tear down the Annex. As

documented in Chapter Three, when approached by the press about the Annex issue

many of those at Horner expressed resignation towards what they saw as the inevitability

of being moved out of the neighborhood to accommodate investors and tourists.

Weinberg encountered more or less the same sentiment when he and Beyer attempted to

organize some of the black vendors to attend and testify at the City Council

337

Transportation Committee meeting in September 1995—a meeting chaired by none other

than the aforementioned Patrick Huels—where the anti-peddling ordinance was

introduced.84 According to Weinberg, when he approached several of the African-

American vendors about attending the meeting, the general response was, “Who are you kidding man? We can’t beat ‘the man’. We’re fucked…you’re wasting your time.”85 In

other words, where the idealistic Weinberg saw a crime, most of the vendors, many of

whom had lived on the margins for most of their lives, saw the inevitable creep of

corporate power.

The backstory of the aforementioned quid pro quo between United Center

ownership and local politicians indicates that the link between the plight of the peddlers

and that of the public housing residents took on a more concrete form than the resonance

between the two groups’ pragmatic pessimism. Before they successfully pressured

Alderman Burnett to introduce the ordinance, Reinsdorf and company tried to hammer

out a deal with Burnett’s predecessor Dexter Watson and Watson’s ally, Illinois State

Senator Rickey Hendon. The team owners hired a handful of Watson and Hendon’s

constituents with the understanding that Watson would ensure passage of the ordinance,

but Watson balked at introducing the measure, demanding more concessions from

Reinsdorf and Wirtz. But before Watson could cash in, Burnett upset him in the 1995

aldermanic election for the 27th Ward, and the team owners promptly offered control over

filling the jobs to Burnett. Soon after, the Chicago Defender reported that Hendon had

called for a boycott of the Bulls’ home opener. He intended to protest the firing of several

African-Americans who had received concessions jobs in the arena as a result of

84 Strausberg, “Beavers Tangles With Peanut Vendors.”

85 Weinberg, interview. 338

negotiations between him and United Center representative Harold Pizer. Presumably,

they had lost their jobs in order to make way for people of Burnett’s choosing.86

While Hendon openly acknowledged his role in setting up the initial jobs-for-

ordinance quid pro quo, Weinberg inadvertently stumbled upon evidence that Hendon

and Watson had agreed to more than just introducing the anti-peddling ordinance.

According to Weinberg, not long after the vendors started receiving some sympathetic press in the local media, a disgruntled United Center employee provided him with copies of an internal memo from Howard Pizer to Wirtz and Reinsdorf, as well as of a letter from Pizer to Alderman Watson’s office, both of which detailed various terms of the quid pro quo. The letter from Pizer to the alderman’s office simply outlined the types of positions that the new employees would fill, and revealed little more than what the

Defender had already reported. However, the internal memo, dated July 26, 1994 and apparently intended to appraise Reinsdorf and Wirtz of the details of Pizer’s negotiations with Watson and Hendon, referenced something that the press had not reported in relation to the vendor saga—the Henry Horner Annex. The end of the memo reads:

It would be made clear that the Joint Venture is only agreeing to this [deal] reluctantly and would not do so unless it resolved existing problems and disagreements with Senator Hendon and Alderman Watson. Therefore, it is expected that we will receive the cooperation of these parties so far as the Horner Annex, the West of Damen Parking, and the 1,000 foot ordinance are concerned.

If the documents leaked to Weinberg are authentic—and no evidence to the contrary has surfaced—then it appears that at some point the negotiations between Pizer and Hendon

86 Chinta Strausberg, “Hendon Wants Bulls Boycott,” Chicago Defender, November 2, 1995, pp. 1, 10. The story was followed up several years later by Carpenter and Nicodemus, “How City Hall Banned Vendors.” 339

touched on the latter placing pressure on the city to facilitate the demolition of the Horner

Annex, which, as Chapter Three argues, Reinsdorf and Wirtz wanted out of the way.87

The point of raising the issue of the memos is not to offer a “smoking gun” behind

some conspiracy engineered by the team owners and local politicians. In fact, most of the

dealings surrounding the anti-peddling ordinance had become public knowledge by the

fall of 1995 because, true to Chicago tradition, those involved talked more or less openly

with the press about it. Instead, the memos confirm that clearing out the vendors

constituted just one part of the owners’ broader agenda of policing the space around their

investment so that skybox lessees and season ticketholders could set aside concerns about

coming face to face with Chicagoans cut off from the fruits of post-industrial urban redevelopment. As Legal scholar Regina Austin explains, “street vending may have a negative impact on the overall reputation and ambience of a commercial area [and thus]

vending conflicts, at base, are disputes about land use and property values.”88 A

monopoly over the concessions market functioned as more than a simple means of

capturing increased revenues from food and souvenirs; it also aimed at protecting the

profitability of other monopoly rents collected by the arena.

The history of political back-scratching that underwrote the passage of the 1,000-

foot ordinance around the United Center provides a telling case study in how the

87 For copies of the leaked documents, see Weinberg, Career Misconduct, 38-41. In response to follow-up questions to an interview with the author conducted in August 2011, Weinberg said that he had no idea what “Horner Annex” referred to, indicating that if the document was fabricated, it wasn’t by him. Mark Weinberg, “Follow Up on UC Docs,” message to the author, September 26, 2011, e-mail. The reference to “West of Damen Parking” likely refers to the agreement made between United Center ownership and the IOP that the former would not seek title to any land west of Damen (see Table 3.2). The online records of the Cook County Assessor’s office indicate that the United Center eventually acquired the titles to several parcels of land now used as parking lots just west of Damen. Whether or not Hendon and/or Watson played a role in facilitating this circumvention of the original agreement with the IOP remains a mystery.

88 Regina Austin, “ ‘An Honest Living’: Street vendors, Municipal Regulation, and the Black Public Sphere,” Yale Law Journal 103, no 8 (June 1994): 2126. 340

professional sports business at the end of the twentieth century cynically adopted and exploited the “free-market” sermonizing dominant within American popular discourse.

The moment that state intervention in the concessions market offered a means by which to solidify the arena’s monopoly, Reinsdorf and Wirtz welcomed such intervention with open arms, despite having paid their lawyers to argue in court that allowing the state to get involved on behalf of the vendors would violate the owners’ alleged right to make as much money as they could with whatever means they chose. One thus has every reason to lump franchises like the Bulls and Blackhawks into what economist James Galbraith terms the “predator state,” a model of governance in which business interests harness the power of public institutions almost exclusively as a means of limiting the public’s ability to derail private growth. “None of these enterprises has an interest in diminishing the size of the state,” Galbraith explains. “For without the state…they would not themselves exist and could not enjoy the market power that they have come to wield.”89

* * *

After the 1,000-ft ordinance wiped out the peanut vendors once and for all,

Weinberg managed to continue selling The Blue Line until the late 1990s. Even though arena officials and local police continued to harass Weinberg and Beyer (Beyer began peddling the program with Weinberg after the peanut ban), the special protections for the sale of printed material under the First Amendment helped them skirt the ordinance. The partnership ended in the late 1990s, when Weinberg walked away from publishing the program. Weinberg wasn’t done trying to irritate Wirtz, though, and he returned to the sidewalks around the United Center in 2000 to sell Career Misconduct, a book he wrote chronicling Bill Wirtz’s notorious history of corruption. Despite attempts by the police to

89 Galbraith, The Predator State, 132. 341

forcibly remove Weinberg for violating the anti-vending ordinance, Weinberg

successfully sued the City of Chicago in 2002, securing his right to peddle the

muckraking exposé. Ironically, after losing in district court, Weinberg actually won his

appeal in the Seventh Circuit based on the assertion of his First Amendment rights.90

Weinberg’s newfound luck in dealing with the Seventh Circuit might have had to do with

the fact that Justice Wood did not hear the case, but more likely what won the day was

that he framed the case as the government infringing on his individual freedom of speech,

rather than as a group of team owners trying to protect their profits at the expense of the

“little guy.” Within the Seventh Circuit, anyway, claims to individual freedom gained

traction when they didn’t pose a direct threat to the revenues of people like Reinsdorf and

Wirtz.

Weinberg’s victory nonetheless resonated far beyond the United Center, as entire

professional sports leagues saw the case as a threat to their teams’ ability to control the

space around their respective facilities. As a result, officials from several leagues filed

amicus briefs in support of the city’s appeal to the Supreme Court, contending that, if for

no other reason, barring vendors of all types from around pro sports facilities remained a

priority “because terrorists masquerading as vendors could strike outside the stadium.”91

Apparently, the Supreme Court felt it had better things to do than protect the nation from

Al-Qaeda operatives gone undercover as peanut vendors, since it refused to hear the

city’s appeal.

90 Weinberg v. City of Chicago, No. 02-1372, 2002 U.S. App. LEXIS 23878 (7th Cir. November 20, 2002).

91 “Invoking Terrorism Threat Bad Way to Win Argument,” Pantagraph (Bloomington, Ill.), September 19, 2003, ProQuest. This argument represented only one small example of corporate America’s attempt to use the hysteria around 9/11 as a Trojan horse for a bevy of anti-consumer actions and legislation. See, for example, Greg Palast, Armed Madhouse (New York, NY: Dutton, 2006), 36. 342

In the end, the story of the owner’s purge of vendors from the sidewalks outside

the United Center sheds light on how various arms of the state—in this case the courts

and municipal government—worked to guarantee the profitability of the professional

sports business at a moment defined by increasing economic polarization among sports

fans. As political and economic elites paid extensive lip service to the sanctity of “free

markets” unhindered by state intervention, team owners like Reinsdorf and Wirtz

tolerated competition only insofar as it justified predatory behavior and minimized the

risk of their own investment. When it did not, the owners quickly enlisted the aid of government officials all too willing to help them snuff out their competitors in the name of whatever flavor-of-month excuse sounded best. Almost two decades since the

disappearance of the peanut vendors, little has changed in this regard in Chicago or other

big-league cities.

Apologists for the actions of Reinsdorf and Wirtz would certainly argue when

pressed that the internalization of concessions within the United Center has created

hundreds of steady jobs, and that the elimination of the vendors was an unfortunate but

reasonable price to pay for the larger economic benefits allegedly brought to the

neighborhood by the new arena. However, as the next chapter documents, when it came

to insulating Reinsdorf and Wirtz’s investment in the United Center from risk, the price

paid by Chicagoans went well beyond the livelihoods of the peanut vendors. With the

willing aid of state legislators and the City Council, United Center ownership benefited

from system of public subsidies that relocated the bulk of the financial risk for

constructing the United Center onto the backs of ordinary taxpayers while maintaining

the veneer of a privately-funded development miracle.

343

Chapter Six

“Nothing but Net Profits”: Fiscal Policy and the Socialization of Risk at the United Center1

In a 1997 interview with Sports Illustrated’s E.M. Swift, Jerry Reinsdorf said he

believed “you didn’t have to squeeze every last nickel out of a deal.”2 This was a strange

thing to say for a man in the midst of an aggressive campaign to expel local peanut

vendors from the sidewalks around the United Center. The vendor saga, however, was

only the tip of the iceberg when it came to arena ownership’s efforts to “squeeze” profits

out of the arena.

To understand where Reinsdorf and Wirtz really made their money with the help

of the government, one has to dig into the arena’s fiscal history—that is, its historical

relationship to local taxation. As commentators lauded the team owners’ decision to

privately finance the arena, Reinsdorf and Wirtz successfully pressured lawmakers to

authorize massive backdoor subsidies in the form of an assortment of tax breaks. The

centerpiece of this strategy was 1989 legislation passed by the Illinois General Assembly

requiring local assessors to use a special property tax assessment formula in valuing the

United Center. The legislation saved the owners tens—and much more likely hundreds—

of millions of dollars during the first two decades of the arena’s operation.

The history of this special property tax legislation confirms that development of

the United Center conformed to troubling trends in the world of stadium finance. In the

1 Portions of this chapter appeared previously in Sean Dinces, Nothing But Net Profits: Jerry Reinsdorf, Property Tax Relief, and Corporate School Reform on Chicago’s Near West Side (Chicago, IL: Chicago Teachers Union, January 2013). Inspiration from the title comes from John Handley, “In Play: West Side Story Getting Positive Rewrite with Help of New Stadium,” Chicago Tribune, July 24, 1994, ProQuest.

2 E.M. Swift, “Misunderstood?,” Sports Illustrated, June 30, 1997, accessed July 10, 2013, http://si.com/vault/article/magazine/MAG1010328/6/index.htm. 344

decades following WWII, public subsidies for sports facilities typically depended on the

ability of local governments to secure rights to a significant portion of stadium-generated revenues. However, during the eighties and nineties, amidst growing skepticism about the economic prudence of these subsidies, many stadium developers escaped serious public scrutiny and retained exclusive rights to all revenues by using their own money to cover construction costs. However, as in the case of the United Center, these nominally

“private” deals often involved rarely reported but highly lucrative public subsidies such as tax breaks, as well as the free provision of public services and infrastructural development. In short, public money still flowed, but now teams provided nothing in return.

In addition to the special assessment formula, local aldermen willingly exempted

forty percent of United Center skybox rents from Chicago’s amusement tax, and officials

at the Cook County Assessor’s Office and Cook County Board of Review granted

additional property tax reductions for the United Center in response to formal appeals

filed by Reinsdorf and Wirtz’s lawyers. Whereas the vendor saga revealed the owners’

prowess in using the legislative power of the City Council as a way to hedge against

failure in the federal courts, the fiscal history of the United Center shows how, since the

1980s, the professional sports business in Chicago succeeded in simultaneously

manipulating city, county, and state institutions in order to dramatically reduce the

financial risk involved in investing in a new arena.

As touched on in Chapter Five, sports economists and stadium finance experts

tend to attribute this sort of influence over local governments by the sports business to the

345

special monopoly privilege enjoyed by professional leagues and their member teams.3

There is a good deal of truth in this assessment; we need look no further than the scandal

involving Reinsdorf’s threats to relocate the White Sox for proof that the ability of

leagues to strictly limit competition has emboldened owners to hold cities hostage when

their desires for public subsidies go unmet. However, as with the peanut vendor saga,

citing the special treatment of leagues and teams goes only so far in explaining this story.

Local lawmakers repeatedly acted to limit the fiscal obligations of the owners even in

situations in which Reinsdorf and Wirtz lacked the leverage that came with credible

threats of relocation (i.e. taking their franchises to different cities). Moreover, aside from

some of the legislative details, there was nothing particularly unique about the owners’

relationship to local government in late twentieth-century Chicago (and the U.S. more

broadly). Major land developers from other industries carried out their own anti-tax

campaigns by co-opting the same set of state actors and institutions.

This chapter argues that the growing boldness—some would say arrogance—with which team owners put the state to work for their own gain resulted not just from the particular structure of the pro sports business, but also from its embrace of and response to larger trends in capitalistic accumulation and land use. In the broadest sense, Reinsdorf

and Wirtz’s state-aided campaign to reduce their fiscal liabilities followed the lead of

intensified efforts by members of America’s corporate class to establish, in the words of

tax journalist David Cay Johnston, a “special set of rules” providing them with much-

expanded “opportunities to hide income, fabricate deductions and reduce income,” while

3 Widely cited expositions of this position include James Quirk and Rodney Fort, Pay Dirt: The Business of Professional Team Sports (Princeton, NJ: Princeton, 1992); James Quirk and Rodney Fort, Hardball: The Abuse of Power in Pro Team Sports (Princeton, NJ: Princeton, 1999); William Kern, ed., The Economics of Sports (Kalamazoo, MI: Upjohn Institute, 2000); Judith Grant Long, Public/Private Partnerships for Major League Sports Facilities (New York: Routledge, 2013). 346

saddling “wage earners [with] another, much harsher set of rules.”4 More specifically, it exemplified the successful attempts by many well-connected commercial property owners in Chicago to reshape local property tax structures in order to guarantee and enhance the profitability of their investments.

In late twentieth-century Chicago, as in many other cities, holders of valuable commercial real estate rebelled—albeit without much fanfare or media attention—against a property tax system that they viewed as unnecessarily tilted in favor of residential property holders. By the 1990s these major commercial real estate interests were successfully pressuring local officials at every turn to tweak the law in ways that shifted the property tax burden onto these homeowners. “Homeowners” in this story should not be read as necessarily synonymous with working-class. Those forced to shoulder the increased property tax burden ranged from modest wage-earners struggling to pay their mortgage on one- or two-bedroom dwellings on the South Side to affluent property owners in Lincoln Park. However, there is little doubt that the effects of the shift were both more severe and more difficult to evade for the former. Moreover, more than residential property owners stood to lose. The property tax advantages and other breaks secured by Reinsdorf and Wirtz encapsulated the local sports business’s role in stripping local fiscal policy of redistributive mechanisms meant to benefit poor and middling

Chicagoans, and replacing them with legislation designed to “absorb…the risks and costs of land development so capitalists [did] not have to do so.”5

4 David Cay Johnston, Perfectly Legal: The Covert Campaign to Rig Our Tax System to Benefit the Super Rich—and Cheat Everybody Else (New York, NY: Portfolio, 2003), 12.

5 Rachel Weber, “Extracting Value from the City: Neoliberalism and Urban Development,” Antipode 34, no. 3 (July 2002): 520. 347

Reinsdorf justified the government’s absorption of this risk through a carefully

orchestrated public relations campaign that advertised his philanthropic contributions to

cash-strapped public institutions like Chicago Public Schools. Of course, the portrayal of

Reinsdorf and the Bulls as upstanding corporate citizens worked only so long as the

media stayed away from the fact that massive property tax breaks for projects like the

United Center helped precipitate and perpetuate the dire fiscal situation faced by the city.

The United Center and “Public-Private” Stadium Finance

United Center boosters were fond of pointing out not only the “partnership”

between arena developers and the surrounding neighborhood, but also the fact that

Reinsdorf and Wirtz used their own money to build the arena. Peter Bynoe, a local

financier who helped structure the public funding deal for the new Comiskey Park a few

years earlier, described the United Center to the Tribune in 1994 as “a model for this kind

of facility around the country, especially with its mostly private financing.”6 Jim Edgar,

then governor of Illinois, also offered praise, explaining that “the state helped with $10

million in infrastructure costs, but the fact [that] this state-of-the-art building was built with private money is an example of the type of business ventures we need.”7 A few

years later, Crain’s Chicago Business emphasized the exceptional nature of the financing

behind the United Center. “[Reinsdorf and Wirtz] have performed a public service,” the

paper’s editors insisted, “by showing the Bears, the city and the state that private—rather

than public—stadium ownership is the only rational approach to building a new sports

6 John Handley, “In Play,” Chicago Tribune, July 24, 1994, ProQuest.

7 Mike Kiley, “If Only Teams Sparkle in Debut Like United Center,” Chicago Tribune, August 19, 1994, ProQuest. 348

facility.”8 As both Bynoe and Edgar conceded, the Bulls didn’t pay for everything—both

the state and the city chipped in for surrounding infrastructure—but the team owners

certainly covered the $175 million in construction costs.9

The new revenue streams created by the United Center, as well as the dual

occupancy of the Bulls and Blackhawks, would keep enough cash flowing year round to

make private investment in the arena a safe bet. Private construction also meant the teams

maintained exclusive rights to all stadium-generated revenues. But the profitability of the

new arena was only one of many factors which led Reinsdorf and Wirtz to decide that

they would pay.10 Some of these factors were decidedly local in nature. For example,

Reinsdorf’s threats to relocate the White Sox away from Chicago if the city and state

blocked public financing for the new Comiskey Park during the late eighties left a bad

taste in the mouth of Chicagoans. While some sources described the new baseball

stadium as a “ ‘public-private’ sports venture,” the “public” benefits were trivial.11 Not only did the city and state pick up the construction costs; they also allowed Reinsdorf to keep all stadium-generated revenues, save a small percentage of ticket sales beyond an

annual attendance threshold that the team often failed to reach.12 The structure of the deal

8 “Editorial,” Crain’s Chicago Business, May 26, 1997, ProQuest.

9 Robert Baade and Allen Sanderson, “Bearing Down in Chicago: Location, Location, Location,” in Sports, Jobs and Taxes: The Economic Impact of Sports Teams and Stadiums, ed. Roger Noll and Andrew Zimbalist, 324-354 (Washington, D.C.: Brookings Institution, 1997).

10 Jeff Borden, “Bulls Pondering Life After Mike,” Crain’s Chicago Business, June 14, 1993, ProQuest.

11 Edward Kiersch, “Playing Hardball,” Cigar Aficionado, Summer 1995, accessed July 10, 2013, http://www.cigaraficionado.com/webfeatures/show/id/Playing-Hardball_6085/p/1.

12 For more on the details of the generous lease agreement secured by Reinsdorf for the New Comiskey Park, see Charles Euchner, Playing the Field: Why Sports Teams Move and Cities Fight to Keep Them (Baltimore, MD: Johns Hopkins, 1994); and Christopher Lamberti, “ ‘Rent’ in the White Sox/ISFA Agreement,” Chicago Sport and Society, April 24, 2013, accessed July 10, 2013, http://www.chicagosportandsociety.com/2013/04/24/rent-in-the-white-soxisfa-agreement/. 349

led frequent Reinsdorf critic Ben Joravsky to refer the new Comiskey as the “home of the

sweetheart deal,” and Reinsdorf no doubt realized that asking the government to agree to

a similar deal for a new basketball arena was likely to meet stiff resistance.

Aside from the deal secured by Reinsdorf and the White Sox, important national

shifts in the politics of stadium finance made the use of private funds to construct the

United Center the most pragmatic course of action. By the 1980s, local and state

governments had become wary of using public money to cover the costs of building and

maintaining major league sports facilities. Until the late 1970s, municipalities regularly

used urban renewal funds and local tax revenue to fully finance stadium development

under the assumption that the facilities constituted “a form of civic infrastructure” on par

with schools and bridges. As stadium finance expert Judith Grant Long reports, during

the 1970s, “the average public expenditure for a new sports facility was $203 million, or

89 percent of the average total cost of $246 million (2010 dollars).” Local governments’

willingness to assume so much responsibility for stadium finance began to wane,

however, amidst the decline in federal aid to cities, as well a growing consensus among

academic experts and community activists that sports facilities did not offer economic

and civic benefits on par with other, more traditional types of infrastructure.13

In terms of financing the new arena, Reinsdorf and Wirtz had to account for more

than just increasing resistance from cash-strapped local governments and skeptical academic experts. During the eighties the U.S. Congress took steps intended to make it more difficult for cities and states to assume a leading role in stadium financing. The Tax

Reform Act of 1986 attempted to curb public involvement in stadium finance by

13 Long, Public/Private Partnerships for Major League Sports Facilities, 35-36. These figures take into count the costs of land, buildings, and infrastructure only. 350

restricting cities’ and states’ use of tax-exempt bonds to pay for stadium construction.

Local governments had historically used tax-exempt bonds for a wide variety of

infrastructural projects because they allegedly offered a win-win for both bondholders and municipalities. In theory, bondholders accepted lower interest rates since they did not have to pay taxes on earned interest, and local governments reduced debt service by locking in these lower interest rates.14 The 1986 legislation prohibited the issuance of tax- exempt bonds for stadiums where more than 10 percent of debt service came from stadium-generated revenues (the idea being that, since cities had historically covered most stadium-related debt service with revenues from rents and percentages of stadium revenues, local governments would find it unrealistic to keep bankrolling new

facilities).15

However, Congress provided exemptions from the new prohibition to Chicago

and several other cities with stadium plans already in the works in the mid-eighties. This allowed Chicago and Illinois to issue tax-exempt bonds for the construction of the New

Comiskey Park.16 Given the favorable terms secured by the White Sox and increasing hostility to the use of tax-exempt bonds for stadiums, Reinsdorf and Wirtz understood

14 As Joanna Cagan and Neil DeMause point out, this all came “at the expense of the federal treasury, which forgoes taxes on bond buyers’ profits.” Joanna Cagan and Neil DeMause, Field of Schemes: How the Great Stadium Swindle Turns Public Money Into Private Profit (Lincoln, NE: University of Nebraska, 2008), 51.

15 On the tax reform act, see, See Long, Public/Private Partnerships for Major League Sports Facilities, esp. 163-165; Cagan and Demause, Field of Schemes, esp. 51-53; and Dennis Zimmerman, “Subsidizing Stadiums: Who Benefits, Who Pays?” in Sports, Jobs, and Taxes: The Economics Impact of Sports Teams and Stadiums, 119-145 (Washington, D.C.: Brookings Institution, 1997).

16 For an overview of the politics behind the exemption secured by Chicago and Illinois to use tax-exempt bonding to finance the New Comiskey, see David Narefsky, internal memorandum to Jackie Grimshaw, Bill Luking, and Elaine Johnson, City of Chicago Department of Law, July 22, 1987, Box 16, Folder 5, Robert Mier Papers, Chicago History Museum, Chicago, Illinois. 351

that they would have to do things differently in the case of their new West Side arena.17 It

is true that the Tax Reform Act contained certain loopholes that actually encouraged some

cities to pay even greater shares for stadium construction and maintenance, but in the

immediate wake of the deal for the New Comiskey, this was an unlikely scenario in

Chicago.

Reinsdorf and Wirtz also had good reason to rule out asking local government to fund the new arena using means other than tax-exempt bonds, such as voter-approved referendum for increased property or sales taxes. Many Chicagoans were bitter with

Reinsdorf over his threats to move the White Sox, and Wirtz had earned a well-deserved reputation as a monopolistic liquor distributor with little regard for the law.18 Moreover,

voters in other cities had recently rejected proposals for levying new or increased taxes in

order to fund stadiums. For instance, in 1989, citizens in Phoenix voted down a

referendum which called for financing a new baseball stadium through an increase in the

local property tax rate.19 Data compiled by sports economist Rodney Fort shows that, not

including the Phoenix case, voters in at least seven different cities/states rejected binding

referenda on public support (e.g. bonds, excise taxes, lottery proceeds) for stadium

construction between 1987 and 1995.20

17 In many locales, this mandate actually had the opposite of the intended effect over the long-term. After 1986 several cities desperate to attract or hold on to teams allowed them to pay little or no rent to use public facilities in order to stay below the 10 percent threshold and maintain access to tax-exempt bonds. As Dennis Zimmerman explains, “the 1986 act has had two noteworthy effects. It virtually requires that, if a stadium is financed in part by a state or local government bond, it must provide a highly favorable lease to its professional tenants. And the act redistributes the burden for debt service among local taxpayers, as general revenue sources must be substituted for stadium-related revenues.” Zimmerman, “Subsidizing Stadiums,” 137-138.

18 See Mark Weinberg, Career Misconduct: The Story of Bill Wirtz’s Greed, Corruption and the Betrayal of Blackhawks’ Fans (Chicago, IL: Blueline Publishing, 2001).

19 Long, Public/Private Partnerships, 163.

352

Put simply, the decision by Reinsdorf and Wirtz to privately finance the

construction of the United Center had nothing to do with ethics; it had to do with

expectations around profitability and a complex set of historical and political imperatives.

Indeed, they were not the only team owners who dug further into their pockets for new

facilities. Data collected from news media and secondary sources by Judith Grant Long

(Table 6.1) suggest that nationwide the share of stadium financing shouldered by the

public dropped significantly after the seventies. According to these figures, the “reported

public share” of financing (taking into account reported costs of building, land, and

infrastructure) among facilities built for NBA teams went from close to 87 percent for the

period between 1970-1979 to 65 percent for 1980-1989, and down to 34 percent during the first half of the 1990s.21 By the time ownership of the Bulls and Blackhawks decided to pull the trigger on a new arena, the world of stadium finance had seemingly changed.

According to a new generation of pro-stadium boosters, public-private

“partnerships” would allow team owners and local governments to share investment risk

more equitably. In theory, these partnerships offered private sports franchises several

benefits, such as access to cheap land in close proximity to large urban fan markets

(especially near central business districts with executives hungry for luxury suite leases),

20 These included Colorado Springs (1989), Durham, NC (1990), Milwaukee (1995), New Jersey (1987), San Jose (1992), Santa Clara, CA (1990), and Seattle (1995). Original data tables available in Rodney Fort, “Direct Democracy and the Stadium Mess,” in Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums, ed. Roger G. Noll and Andrew Zimbalist, 146-177 (Washington, D.C.: Brookings Institute Press, 1997), 161. Updated table available in James Quirk and Rodney Fort, Hardball: The Abuse of Power in Pro Team Sports (Princeton, NJ: Princeton University Press, 1999), 226.

21 Long’s methodology for compiling this dataset (summarized in Table 6.1) is fairly straightforward. She examined newspapers, general interest publications, industry trade publications, and academic sources, but not primary documents from local and state government institutions/authorities involved in stadium financing. For each facility she summed the reported costs of land, infrastructure, and building construction, terming the sum “reported public cost.” “Reported public share” is calculated as the ratio between the public contribution to “reported public cost” and the total “reported public cost.” See Long, Public Private Partnerships, 18-19. 353

as well as rights to an increased share of stadium-generated revenues. For their part, cities allegedly benefited through the private redevelopment of underutilized land, urban

“branding” effects, release from the obligation to cover operational costs, and, most of all, increased property tax revenues.22

Table 6.1. “Reported Public Share” of Stadium Financing, 1970-1994.a 1970-1979 1980-1989 1990-1994 All Major Leagues (n = 51)b Number of Stadiums/Arenas Opened 24 11 16 or Renovated Weighted Average Reported Public 95.4 58.2 58.7 Share (%)c Median Reported Public Share (%) 100.0 90.0 82.0 NBA Only (n = 22) b Number of Arenas Opened or 7 8 7 Renovated Weighted Average Reported Public 87.2 65.3 34.0 Share (%)c Median Reported Public Share (%) 100.0 100.0 34.0 Source: Adapted from Long (2013). a Stadiums grouped based on year in which they opened. Long bases “reported” cost data on industry, academic, general interest, newspaper, and internet sources (but not primary sources produced by local governments involved in stadium finance). These figures account for building, land, and infrastructure costs only. b Includes, NFL, MLB, NBA, and NHL. Sample excludes Canadian facilities (which explains minor variations between these figures and the figures reported by Long), and includes both new construction and major renovations. c Averages weighted by total reported cost of each facility.

Even if Reinsdorf and Wirtz opted for private financing for reasons other than altruism, Long’s data on reported public shares of facility financing suggest that, from a purely fiscal perspective, the United Center represented a relatively good deal for

Chicagoans. According to the popular publications and secondary sources culled by

Long, the public share of financing for the United Center stood at 0 percent. By contrast,

22 Long, Public/Private Partnerships, xiii, 4-7, 35-36. On the critical importance of tax revenue in making these partnerships pay off for cities, see Mark Rosentraub, Major League Winners: Using Sports and Cultural Centers as Tools for Economics Development (Boca Raton, FL: CRC Press, 2009). 354

these reports show that taxpayers paid at least 84 percent of the bill for buildings, land, and infrastructure for the New Comiskey Park.23

We know that these figures underestimate the public costs and shares of these projects for at least two reasons. First, both popular and academic sources often fail to report important liabilities such as infrastructural costs incurred as a result of stadium development. Second, they regularly overlook “ongoing public expenses associated with operation of the facility” such as the cost of maintenance or relevant municipal services, and almost never account for forgone property taxes as a result of exemptions or abatements.24 In order to correct for these oversights, Long used official government reports in addition to popular and secondary sources to construct a separate dataset for estimating the “adjusted public share” of stadium financing for every major-league facility in operation in 2010. To do this, she: 1) updated her figures for “total capital cost” or “total development cost” (i.e. up-front costs for building construction, land, and infrastructure) in cases in which popular and secondary sources did not offer comprehensive accounts, 2) recalculated the public contribution to the updated total

23 Long, Public/Private Partnerships, 24. There appears to be a small discrepancy between the summary statistics on the “reported public share” of United Center financing provided by Long in her book and the raw data that she collected to generate the statistics. According to working papers containing the raw data, Long looked at academic publications showing that the state and city financed associated infrastructural costs. In theory, this would yield a “reported public share” figure greater than 0 percent. Long does include the infrastructural costs as part of her “adjusted public share” model, which is discussed in more detail in the remaining chapter text. Even after correcting for this, the “reported public share” of the United Center rises to only 15%, still well below the league average. It appears that reported public share for the New Comiskey is below 100% as a result of Long’s consideration of nominal rent and ticket surcharge payments made by the White Sox to the state. For the working paper data, see Judith Grant Long, “Public Funding for Major League Sports Facilities (3): National Basketball Association,” Center for Urban Policy Research Edward J. Bloustein School of Planning and Public Policy Working Paper Series (New Brunswick, NJ: Rutgers University, n.d.), http://web.archive.org/web/20070706222247/http://policy.rutgers.edu/ faculty/long.html; Judith Grant Long, “Public Funding for Major League Sports Facilities (3): Major League Baseball,” Center for Urban Policy Research Edward J. Bloustein School of Planning and Public Policy Working Paper Series (New Brunswick, NJ: Rutgers University, n.d.), http://web.archive.org/web/20070706222247/ http://policy.rutgers.edu/faculty/long.html.

24 Long, Public/Private Partnerships, 11. 355

development costs, 3) estimated the sum of “ongoing” public costs and tax exemptions for each facility over a 30-year period (the presumed life of each stadium/arena), 4) calculated an adjusted “total public cost” for each deal by adding the public’s contribution to total development cost to the ongoing public costs and tax exemptions accrued over thirty years, and 5) divided this total public cost by the total development cost to arrive at an “adjusted public share” for each deal.25

However, even after correcting for these “hidden” costs, the development of the

United Center appears to have warranted the “partnership” label more than most of its peer facilities. Table 6.2 shows the results of Long’s hidden-cost adjustments to her data on public share of investment in both the United Center and the New Comiskey Park

(now dubbed US Cellular Field) relative to the averages and medians of all the facilities in their respective leagues in use during 2010. Long estimates that, over the presumed lifetime of the facility, local taxpayers will have paid $130 million (2010 dollars) in support of the United Center by covering the costs of associated infrastructure and the ongoing delivery of municipal services (e.g. local police presence on game nights). While

25 To understand in more detail the difference between “reported public share” and “adjusted public share,” consider the following hypothetical example: A team owner decides to build a new stadium, and fund part of it with her own money. Local newspapers report that “total capital costs” or “total development costs” for the project are $70 million, and that the owner and county have each committed to contribute $35 million. In this case, the “reported public share” of the financing is 50%. However, after digging more deeply into the primary sources, a researcher discovers additional capital costs not reported in the media: $10 million for purchasing the land and $20 million for surrounding infrastructure upgrades—both of which are paid for exclusively sales tax revenues from the county. At this point, the adjusted “total development cost” would be $100 million (the sum of building, land, and infrastructure). Additional research reveals that it will cost the city $1 million each year to provide the required police presence outside the stadium on game days/nights, and that the stadium is exempt from paying property taxes, which would have amounted to $2 million annually in the absence of the exemption. Assuming the team occupies the facility for 30 years, the police presence and foregone property taxes will cost local governments (i.e. taxpayers) $90 million over the stadium’s lifetime. This brings the total public cost for stadium financing to $155 million ($35 million for building costs, $10 million for land, $20 million for infrastructure, and $90 million for ongoing costs and tax exemptions). According to Long’s methodology, the “adjusted public share” in this case is this total public cost divided by the adjusted total development cost, or 155% (i.e. $155 million/$100 million). For the sake of simplicity, this example does not account for inflation or the discount rate, but Long’s data do. 356

no doubt a big number, this amounts to only 41 percent of the updated “total development cost” and is significantly below the average and median public shares for the NBA as a whole (see Table 6.2).26 Compared to the New Comiskey Park, where, according to

Long’s estimates, Chicagoans will have poured in the equivalent of 107 percent of the

“total development cost,” the Bulls’ new home appears to have been a relatively good deal for taxpayers.27

Table 6.2. “Adjusted Public Share” of Financing for MLB and NBA Facilities in Use as of 2010.a Major League Baseball (MLB ) b Average Adjusted Public Share (%) 78 Weighted Average Adjusted Public Share (%)c 71 Median Adjusted Public Share (%) 86 New Comiskey Park (US Cellular Field) Adjusted Public Share 107 National Basketball League (NBA) b Average Adjusted Public Share (%) 68 Weighted Average Adjusted Public Share (%)c 66 Median Adjusted Public Share (%) 57 United Center Adjusted Public Share 41 Source: Adapted from Long (2013). a Long calculates adjusted public share by dividing “total public cost” by “total development cost,” where “total development cost” includes up-front costs for building construction, land, and infrastructure, and where “total public cost” includes public contributions to both “total development costs,” annual costs (i.e. operational costs, maintenance, etc.), and foregone property taxes. Annual costs and forgone property taxes are summed assuming a thirty-year facility lifespan. b Samples exclude Canadian facilities (which explains minor variations between these figures and the figures reported by Long), and includes both new construction and major renovations. c Averages weighted by “total development cost” or “total capital cost” of each facility.

26 Long pegs the initial or “reported” total development cost for the United Center (reflected in Table 6.1) at $180 million, or $260 in 2010 dollars. After factoring in the cost of land and infrastructure, the adjusted total development cost rose to $319 million in 2010 dollars. Long, Public Private Partnerships, 24, 144.

27 For the original data underlying Long’s analysis, see Judith Grant Long, Public Funding for Major League Sports Facilities, Data Series, Center for Urban Policy Research Edward J. Bloustein School of Planning and Public Policy Working Paper Series (New Brunswick, NJ: Rutgers University, n.d.), http://web.archive.org/web/20070706222247/ http://policy.rutgers.edu/faculty/long.html. Recent research by historian Christopher Lamberti suggests that the 107 percent figure significantly underestimates the public share of investment in the New Comiskey Park. See Christopher Lamberti, “US Cellular Field and Soldier Field: The Gifts that Keep on Taking,” Chicago Sport and Society, September 18, 2013, http://www.chicagosportandsociety.com/2013/09/18/us-cellular-soldier-field-field-gifts-keep-taking/. 357

Property Tax Relief as Alternative to Traditional Public Stadium Finance

At the end of the nineties, much of the media continued to operate under the

assumption that the public component of the United Center partnership consisted of the

cost of surrounding infrastructure only. A 2000 USA Today editorial critical of public

financing of professional sports facilities lauded the seemingly exceptional deal behind

the West Side arena. “The United Center in Chicago was largely financed with private

dollars,” the editorial explained. “The total cost of $175,000,000 included a mere

$10,000,000 from the state for infrastructure improvements. A new arena for which the private sector picks up 94% of the tab isn’t perfect, but nowadays, it is pretty good.”28

While we know that the city was also paying for municipal services like police presence

on game nights, those payments, along with those for the aforementioned infrastructure,

appeared to be the extent of their contribution.29

But what about property tax exemptions and abatements? As Long explains, “for

major league franchises in the US, property tax abatements are the rule,” especially for

publicly-owned facilities that are not assessed for property tax purposes.30 While the

United Center was privately owned, that most commentators mentioned nothing about

property tax breaks for Reinsdorf and Wirtz was still noteworthy since, according to

28 Raymond Keating, “It’s Time to Get Government Out of the Sports Business,” USA Today Magazine, March 1, 2000. The $10 million figure is likely an underestimate (see Chapter 4 for details).

29 Long, “Public Funding for Major League Sports Facilities (3): National Basketball Association,” 78.

30 For example, Reinsdorf and the White Sox paid no property taxes on the new Comiskey Park since the land technically belonged to the city. The deal secured by Reinsdorf for public funding of the new White Sox stadium not only exempted him and his co-owners from paying property taxes, but also from paying “leasehold taxes,” or “a little-known form of property taxes that are charged to tenants like the White Sox who lease exempt real estate from a government body.” Chuck Neubauer, “Deal Saves Sox Millions,” Chicago Sun-Times, December 19, 1995, NewsBank. 358

Long, “even teams that own and operate their own facilities have been able to gain

property tax exemptions.”31

In truth, the United Center was no exception to the rule. In 1989, as Reinsdorf and

Wirtz completed their plans for the new arena, the Sun-Times quietly reported on

legislation passed by the Illinois General Assembly authorizing a “property tax break” for

the team owners “that could save them millions of dollars over the course of the 22-year

agreement.”32 The article offered no additional details, and while the paper mentioned the

tax breaks once more the following month, it added only that “Wirtz said the project

would not be economically feasible if the state did not come up with the assistance

package that includes a 22-year property tax break.”33 After that, the story disappeared.

The media’s silence on the mysterious tax breaks was strange, especially given

the fact that the relevant Senate Bill sparked a heated debate when it reached the Illinois

House of Representatives. Several of the 47 representatives who opposed the bill (62

voted in favor) claimed that it was a needless handout to corporate elites at the expense of

ordinary residents. Monique Davis, representing Illinois’ 36th State Legislative District,

described as “strange” the fact that “we have so many hospitals closing in the State of

Illinois and we don’t see so many ‘green’ votes up there when we’re trying to keep those

hospitals alive, but when it comes to these civic centers and these ball parks and these

stadiums, we all of a sudden can find the money.” The 25th District’s Donne Trotter

agreed, and noted his disgust with the idea of tax breaks for sports teams after hearing

31 Of the 121 facilities comprising Long’s adjusted public share database, “110 do not pay property taxes, but only 83 are publicly owned.” Long, Public/Private Partnerships, 13, 187.

32 Charles Wheeler III, “Senate Backs a New Bulls-Hawks Stadium,” Chicago Sun-Times, June 23, 1989, NewsBank.

33 Lynn Sweet, “Daley Wary of Bears South Loop Stadium,” Chicago Sun-Times, July 27, 1989, NewsBank. 359

“repeatedly that there are not monies for the indigent.”34 Others who opposed the bill

argued that its use of complex tax assessment jargon masked the true nature of the

legislation. Representative Anthony Young, from the state’s 17th District, urged his colleagues to “look at the Bill.” “If you look at the Bill,” he explained, “it contains one of the most incredible real estate tax giveaways. That’s very hard to decipher but it’s certainly in there.”35

More than five years later, Sun-Times investigative reporter Chuck Neubauer

revived the story. He concluded that “the tax breaks the United Center received from the

Illinois General Assembly will save the owners tens of millions of dollars in real estate

taxes” over the twenty-plus year term of the agreement. According to Neubauer, the

legislation mandated that the Cook County Assessor, the local body tasked with valuing

real estate in Chicago, assess the United Center differently than other commercial

properties. Appendix B explains how the breaks worked, but some of the details deserve

special mention. Normally, the Cook County Assessor had valued commercial properties

based on the net income (i.e. profits) they generate. The tax break legislation allowed

Reinsdorf and Wirtz to dramatically understate United Center income by deducting mortgage interest, as well as federal and state income taxes. In addition, the legislation mandated a reduced assessment level for the United Center. At that time, the Assessor’s

Office usually calculated a commercial property’s assessed value as 38 percent of the

“fair market value” (a function of net income) produced by the property. According to the

34 State of Illinois 86th General Assembly, House of Representatives, transcription of debate on Amendment #1 to Senate Bill 2321, June 30, 1989, Illinois State Archives, Springfield, Illinois.

35 State of Illinois 86th General Assembly, House of Representatives, transcription of debate on Amendment #1 to Senate Bill 2321, June 30, 1989, Illinois State Archives, Springfield, Illinois. 360

deal, the Assessor would value the arena at only 20 percent of its fair market value (after

making the authorized deductions from net income).36

These breaks created a division between public and private responsibility within the United Center “partnership” that differed radically from prevailing assumptions.

Income statements and tax payment histories on record at the Cook County Assessor’s

Office show that, for tax years 1997 through 2011, the team owners paid at least $81 million (2011 dollars) less in property taxes than they would have if the assessor had

adhered to standard assessment statutes.37 Moreover, this probably underestimates the

actual savings by a considerable margin. As detailed in Appendix B, the data from the

Assessor’s Office omits the arena’s “net income multiplier,” a value required to calculate

exact assessments for commercial properties. The $81 million estimate uses the lowest

possible value for the unknown multiplier, but as Neubauer explained in his exposé, it

was almost certainly much higher. Using values based on his investigation, the estimate

of savings over the fifteen-year period jumps to more than $189 million. Figure 6.1

compares the amount that the arena owners actually paid in property taxes with two

estimates of counterfactual tax liabilities under normal assessment procedures (one for

the lower bound of the net income multiplier, and one for the value based on Neubauer’s

investigation). Even using the most conservative estimates, they never paid more than

half of what they would have owed had the Assessor’s Office valued the United Center

according to standard property tax law. In most years, they paid less than a fourth.38

36 State of Illinois 86th General Assembly, House of Representatives, transcription of debate on Amendment #1 to Senate Bill 2321, June 30, 1989, Illinois State Archives, Springfield, Illinois.

37 “Tax years” are those in which the assessments were conducted (payments were made for each tax year in the subsequent year).

361

Counterfactual Based on Neubauer Report (NIM = 8) Lower Bound Counterfactual (NIM = 4) Actual Payment

25

20

15

10 2011 Dollars (Millions)

5

0 1997 1999 2001 2003 2005 2007 2009 2011 Tax Year

Figure 6.1. United Center’s Actual Property Tax Payments vs. Counterfactual Property Tax Liabilities under Standard Assessment Procedure for Tax Years 1997-2011.a Source: Cook County Assessor’s Office, Freedom of Information Act Request (2013). Inflation adjustments made using CPI-U for Chicago Metropolitan Statistical Area (MSA). a “Tax Year” refers to the year in which the assessment was conducted (actual billing and collection of payment for a given tax year occurs in the subsequent year). The graph includes two counterfactual estimates, one based on a net income multiplier (NIM) of 4 (the lowest possible value for this variable), and another based on a NIM of 8 (the value suggested by Neubauer’s investigation). See Appendix B for more on estimation methodology.

When confronted with Neubauer’s report in 1995, the teams offered three justifications for the special legislation. In the first place, “it was unfair to focus on the tax breaks” since, according to United Center spokesperson Howard Pizer, “taxpayers will get $700,000 more in real estate taxes from the United Center than from the [old]

38 Cook County Assessor’s Office, Freedom of Information Act Request, order number 62939, transaction no. 62013, March 28, 2013. Inflation adjustments made using CPI-U for Chicago Metropolitan Statistical Area (MSA). 362

Chicago Stadium.”39 Admittedly, the United Center yielded more in property taxes than

the older venue. In the early nineties, the average property tax bill at Chicago Stadium

amounted to approximately $475,000 (constant 2011 dollars).40 For tax years 1997 through 2011, actual property tax bills for the United Center averaged about $1.8 million.41 Using standard assessment formulas would have resulted in annual tax bills in

excess of $10 million for many of the years in question, which might sound excessive.

Keep in mind, however, that with the exception of 2004 and 2005 (the years in which

United Center revenues dipped as a result of NHL work stoppages), annual net income

(i.e. profits) generated by the new arena averaged more than $32 million.42 In other

words, the owners would have taken home tens of millions in profits even in the absence

of the breaks.

The net income and property tax payment data graphed in Figure 6.2 reveals that, despite big jumps in arena profits during the late nineties, property tax obligations went

in the opposite direction. This had to do with the fact that the deductions from net income

authorized by the state—the deduction of state and federal income taxes in particular—

offset big increases in the net income figures that the Assessor’s Office normally would

39 Pizer paraphrased by Chuck Neubauer, “Stadium Snares Huge Tax Breaks,” Chicago Sun-Times, April 16, 1995, NewsBank.

40 Author’s calculations based on Cook County Clerk’s Office, Tax Payment Warrant Book Vol. 588, 1990, 1991, 1992, 1993, 1994, Cook County Building, Chicago, Illinois. Warrant Book years correspond to tax years.

41 Author’s calculations based on Cook County Assessor’s Office, Freedom of Information Act Request, order number 62939, transaction no. 62013, March 28, 2013. Inflation adjustments made using CPI-U for Chicago Metropolitan Statistical Area (MSA).

42 Author’s calculations based on Cook County Assessor’s Office, Freedom of Information Act Request, order number 62939, transaction no. 62013, March 28, 2013. Inflation adjustments made using CPI-U for Chicago Metropolitan Statistical Area (MSA). The revenue statements provided by the United Center to the Cook County Assessor include skybox rental/lease revenues, but not regular ticket sales. It is likely that the Bulls and Blackhawks itemized their regular ticket sales in their individual corporate income tax returns. 363

have used to value the property. As the graph shows, the deductions kept a very low ceiling on the arena’s tax bills throughout the 2000s.43

Actual Net Income (left vertical) Actual Tax Payments (right vertical)

45 3.5

40 3.0 35 2.5 30

25 2.0

20 1.5 15 2011 Dollars (Millions) 1.0 2011 Dollars (Millions) 10 0.5 5

0 0.0 1997 1999 2001 2003 2005 2007 2009 2011 Tax Year

Figure 6.2. United Center Net Income (Profits) and Actual Property Tax Payments for Tax Years 1997-2011.a Source: Cook County Assessor’s Office, Freedom of Information Act Request (2013). Inflation adjustments made using CPI-U for Chicago Metropolitan Statistical Area (MSA). a “Tax Year” refers to the year in which the assessment was conducted (actual billing and collection of payment for a given tax year occurs in the subsequent year). Net income data corresponds to the year prior to the tax year, since assessments are based on prior years’ net income figures. For example, the net income data point for the 2001 tax year corresponds to net income generated by the arena in 2000 (or in “fiscal year” 2000). “Net income” refers to income less operating and non-operating expenses.

The second justification offered by Pizer was that the United Center was “one of a kind” and thus “it was unfair to compare [its] taxes with any other properties.”44 In fact,

Chicago had a property quite comparable to the United Center that did not enjoy the same kind of preferential assessment: Wrigley Field. Between tax years 1990 and 2005 the

43 Cook County Assessor’s Office, Freedom of Information Act Request, order number 62939, transaction no. 62013, March 28, 2013.

44 Neubauer, “Stadium Snares Huge Tax Breaks.” 364

annual property tax bill for the Cubs’ home edged up slightly, and the increases

accelerated dramatically thereafter (Figure 6.3). The Cubs’ property tax liabilities thus

increased while the property tax burden on the Bulls and Blackhawks fell. In fact, by the

mid-2000s the Cubs were paying more in property taxes than the United Center, despite

the fact that Wrigley produced lower venue-related revenues due to the dearth of luxury suites and surface parking.45 This was rather ironic since, according to economists Robert

Baade, Mimi Niklova, and Victor Matheson, due to its tight integration into the surrounding neighborhood Wrigley is one of the few major league facilities in the U.S. with a “synergistic commercial relationship with its neighborhood”—precisely the opposite of the relationship between the United Center and West Haven described in

Chapter Four.46

45 For data on venue-related revenues for Wrigley Field and the United Center collected using the same methodology, see Rodney Fort, “NBA Income and Expenses,” Rodney Fort’s Sports Business Data, https://umich.box.com/s/41707f0b2619c0107b8b/1/320022877. Both teams appear to have claimed ticket sales off of stadium/arena books, which should make comparisons between Wrigley and the United Center valid. Also of note is the fact that, while the United Center’s property tax liabilities show a dip reflecting the decrease in net income resulting from the 2004-05 NHL lockout, those for Wrigley Field did not dip during the 1994 Major League Baseball work stoppage.

46 Robert Baade, Mimi Niklova, and Victor Matheson, “A Tale of Two Stadiums: Comparing the Economic Impact of Chicago’s Wrigley Field and U.S. Cellular Field,” International Association of Sports Economist Working Paper Series, Paper No. 06-14 (August 2006), 5. 365

1.8

1.6

1.4

1.2

1.0

0.8

0.6 2009 Dollars (Millions)

0.4

0.2

0.0 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 Tax Year

Figure 6.3. Wrigley Field Tax Payments for Tax Years 1990-2009.a Source: Cook County Clerk’s Office, Warrant Book Records Vault. a “Tax Year” refers to the year in which the assessment was conducted (actual billing and collection of payment for a given tax year occurs in the subsequent year).

Finally, in defense of the tax breaks, Bill Wirtz “said lenders wanted to know

what the taxes would be before [private banks] would lend any money for the project.”47

In other words, private financing of the facility’s construction costs would never have happened in the absence of such huge breaks; accepting a cap on property tax revenues from the United Center was the price the public had to pay in order to cement its

“partnership” with the teams. This was less than the whole story. Had Wirtz wanted to

give a more transparent explanation to Chuck Neubauer, he would have conceded that the

banks wanted proof that the team owners had secured the tax breaks not as a precondition

of lending to the team owners, but rather as a precondition of lending to them at the

47 Neubauer, “Stadium Snares Huge Tax Breaks.” 366

interest rates that the team owners desired in order to minimize their debt service (the guarantee of increased profits reassured lenders that the risk of default was minimal).

In effect, Reinsdorf and Wirtz had identified a new, less visible way of securing major public subsidies for their private venture. Plugging the hidden cost of the breaks

over thirty years into the model developed by Judith Grant Long would likely bring the

amount paid by local tax payers for the United Center up to the equivalent of at least 90 percent of the original development costs (i.e. building, land, and infrastructure), if not considerably more.48 Indeed, the history of the United Center property tax breaks

confirms Long’s contention that public reports have dramatically understated the public

costs involved in “partnerships” with major league sports franchises, and, by extension,

that most of these deals “are in fact highly uneven” rather than equitably split between

taxpayers and team owners. After running the numbers, she found that “across all 121

facilities [in use in 2010], these uncounted public costs exceed $10 billion,” and that

accounting for these unreported costs means that, in the average “public-private” deal,

taxpayers pick up more than three quarters of the overall tab.49 While local governments

accounted for a smaller share of financing during the eighties and nineties than they had in the immediate postwar period, teams like the Bulls capitalized on subsidies other than municipal bonds to ensure that the public still bore most of the investment risk.

48 This is a rough estimate based on doubling the lower bound of the tax savings estimate based on data in Figure 6.1, and adding it to the numerator in Long’s “adjusted public share formula.” The estimates of the tax savings that accrued to Reinsdorf and Wirtz do not capture the entirety of the financial benefits they derived from the special tax assessment formula, nor the costs incurred by the city and county. Presumably, the owners used the money they saved on property taxes to generate additional income through other interest-bearing investments. In the parlance of economists, this assumptions are based on the idea of “present discounted value,” which effectively states that “a dollar to be paid in the future is worth less than a dollar today,” since a “dollar today” has the potential to create some sort of return on investment before some point in the future. For a basic introduction to this idea, see John Taylor, Principles of Macroeconomics (Boston, MA: Houghton Mifflin, 2007), 394-395.

49 Long, Public/Private Partnerships, 80. Long does not specify here whether it’s three quarters of total costs or original development costs. 367

Moreover, as Long also points out, the increasing extravagance of major league facilities meant that the absolute costs shouldered by local governments rose quickly even in cases in which they took responsibility for a reduced “share” of stadium financing.50

More than anything, what distinguished the financing behind facilities like the

United Center from the previous generation of stadiums and arenas was the fact that team owners secured the rights to keep all venue-related revenues despite the local state still absorbing the bulk of the costs. In the decades following World War II, the use of urban renewal dollars to build stadiums was usually contingent on local governments’ ability to collect a sizeable share of the cash flows generated by the facility.51 By the early 1990s, owners like Reinsdorf and Wirtz were capturing new influxes of public subsidies—albeit in “hidden” form—without the expectation of having to provide anything in return to the cities and states that hosted them.52

50 Long, Public/Private Partnerships, 33.

51 Long, Public/Private Partnerships, esp. Chapter 1.

52 The United Center was not the first major-league facility to establish exclusive rights to most or all venue-generated revenues despite benefiting from significant direct or indirect public subsidies. As discussed earlier in the chapter, it was not even unique in this sense within Chicago; Reinsdorf ensured that the New Comiskey Park deal conformed to the same general parameters (i.e. public financing without substantial revenue streams for local governments). In terms of the NBA, the aforementioned Palace of Auburn Hills (opened 1988) and the Sacramento King’s Sleep Train Arena (formerly Arco Arena, opened 1988) are two examples that appear to have predated the United Center in this regard. Long’s data shows that the adjusted public share of financing at those facilities was 41% and 56% respectively, and the author of this text could find no evidence of any revenues from either being set aside for local governments. The financing deal for Indiana Pacers’ Bankers Life Fieldhouse (formerly Conseco Fieldhouse, opened 1999) is a particularly egregious post-United Center example of this dynamic. Long estimates an adjusted public share of 96% for Bankers Life, and Neil DeMause notes that the Pacers pay no rent and keep all stadium- generated revenues. Long, Public/Private Partnerships, 114; Neil DeMause, “Indy to Pay Pacers $33m Over Three Years for No Damn Reason,” Field of Schemes, July 12, 2010, accessed August 7, 2013, http://www.fieldofschemes.com/2010/07/12/2710/indy-to-pay-pacers-33m-over-three-years-for-no-damn- reason/. 368

Particularly telling in this regard was the Chicago City Council’s 1991 statement of compliance with the state legislation authorizing the tax breaks.53 City Council minutes containing the statement read, “it is an appropriate and desirable public purpose for government to assist and cooperate in such development and construction in order to stabilize and reduce the risks and burdens associated therewith.”54 However, nowhere do the minutes make any mention of the right of the city and taxpayers to some form of guaranteed monetary return from the United Center in exchange for their role as reducers of “risk.” Long uses “unequal” to describe these sorts of partnerships, but perhaps “one- way” better captures this particular case.55

The United Center’s property tax history also exemplifies how franchises relied on the complexity of new subsidy schemes to avoid public scrutiny. The computations in

Appendix B make plain why even seasoned investigative journalists like Chuck

Neubauer could do little more than scratch the surface of the property tax deal. Real estate assessment procedures and tax law in Cook County are notorious for their torturous

53 A statement of compliance was required since the legislation indicated that the city might be called upon to use eminent domain to obtain and transfer land that Reinsdorf and Wirtz wanted for the new arena.

54 “Reports of Committees,” Journal of the Chicago City Council, May 22, 1991, 185, Municipal Reference Collection, Harold Washington Library Center.

55 Long’s data on the adjusted public shares of financing deals structured during the 2000s is somewhat ambiguous with regard to its implications for whether or not the imbalance in these partnerships has improved, continued, or gotten worse. Across all of the major leagues (MLB, NFL, NBA, NHL, and MLS), the average (weighted by total development cost) adjusted public share went from 72% during the 1990s to 73% during the 2000s (the unweighted figures were 68% and 85%, respectively, and the associated medians were 62% and 93%). Broadly, these numbers seem to suggest that taxpayers are footing a higher percentage of the bill for less expensive stadiums, but a consistent or lower share for more expensive ones. It also reflects variations in trends by league. For example, all measures of central tendency for public share declined for the NFL, where stadium costs tend to be the highest. By contrast, for the NBA, all measures jumped significantly (the weighted average went from 48% to 98%, the raw average went from 51% to 104%, and the median went from 41% to 104%). However, for all leagues the average real public contributions to stadium finance (i.e. the actual dollars spent rather than percentage of total cost) rose by large margins. According to Long, public contributions to the average deal sat at $216 for the first half of the nineties, and rose to $334 by the second half of the 2000s. See Long, Public Private Partnerships, 88- 96. 369

intricacies. Digging deeper would have required months of research in the records vault

of the Cook County Clerk’s office and multiple Freedom of Information Act (FOIA)

requests. In this way, the United Center case study corroborates Long’s observation that

the new generation of stadium financing arrangements that came of age in the eighties

and nineties depended on the “opacity of partnership deals” to “obscure the real nature of

ongoing public commitment from taxpayers.”56

As much as this story validates the work of policy scholars like Long, it also

underscores the need for sustained historical research into the intricacies of individual

public-private financing deals across all of the major leagues. Long’s estimates of hidden

costs and adjusted public shares of stadium financing represent, by far, the most sophisticated and comprehensive attempt to quantify the inequities borne by taxpayers as a result of sports facilities construction. However, as she points out herself, “because the model was designed to analyze a large number of cases, it makes use of simplifying assumptions that do not always reveal the full extent of subtleties and nuances within and across deals.” In particular, her model for estimating forgone property tax revenue, which applies a standard formula to all publicly-owned arenas exempt from property tax assessment, is subject to error as a result of different assessment procedures “across multiple jurisdictions.” In the absence of contradictory evidence she has to assume that privately-owned facilities like the United Center have paid standard property taxes.57

56 Long, Public/Private Partnerships, 153. As sociologist Darwin Bondgraham points out in the context of public-private partnerships in general, this opacity helps “explain the relative lack of opposition” mounted by those taxpayers, since few outside the orbit of the corporate elite have the resources to cut through the “hundreds of pages of binding obligations…and strange formulas for determining payments.” Darwin Bondgraham, “Highway Robbery,” Dollars & Sense, November/December 2012, 14.

57 Long, Public/Private Partnerships, 78. A similar issue comes to the fore in Geoffrey Propheter’s recent survey of property tax savings at professional sports facilities for 2013. He estimates that “the foregone revenue of full and partial exemptions for 62 of the 114 in use during the 2012-2013 seasons in the five 370

The United Center Tax Subsidies and Fiscal Policy in Late Twentieth-Century Chicago

More than increasing the precision of public subsidy estimates, a decidedly

historical approach offers a fuller understanding of why and how stadium finance

partnerships became so one-sided. Sports economists and policy experts typically identify

the “ultimate culprit” behind this outcome as the monopoly power exercised by teams

which, according to Rodney Fort, “derives from special legal treatment of leagues.”58 In

other words, since the government allows leagues like the NBA to operate openly as

cartels that carefully limit the supply of franchises, those franchises enjoy a uniquely

privileged market position when it comes to securing public subsidies. Judith Grant Long

adds that unequal partnerships also became more likely as increased demand for teams

during the eighties converged with “the efforts of entrepreneurial cities using sports

tourism as a means to achieving economic and urban development goals.”59

All of these factors no doubt made localities both vulnerable and responsive to leagues and teams making threats to relocate or contract franchises if cities and/or states

did not offer public subsidies. This is precisely what transpired during negotiations

between Reinsdorf and the city/state regarding the new White Sox stadium in the late

eighties. However, depending exclusively on these explanations, which focus in one way

or another on the economic intricacies of the sports business, obscures the fact that

major leagues to be $251 million” in 2010 dollars. Geoffrey Propheter, “Sports Facilities and the Property Tax,” State Tax Notes, April 29, 2013.

58 Rodney Fort, “Market Power in Pro Sports,” in The Economics of Sports, ed. William Kern, 7-20 (Kalamazoo, MI: W.E. Upjohn Institute for Employment Research, 2000), 8. For other examples of this explanatory framework, see Quirk and Fort, Pay Dirt; Quirk and Fort, Hardball; Roger Noll and Andrew Zimbalist, “Build the Stadium—Create the Jobs!,” in Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums, 1-54 (Washington, D.C.: Brookings Institution Press, 1997); Geoffrey Propheter, “Are Basketball Arenas Catalysts of Economic Development?,” Journal of Urban Affairs 34, no. 4 (2012): 441-459.

59 Long, Public/Private Partnerships, 5. 371

Reinsdorf and Wirtz’s success in using property tax abatements to shift the risk of their

investment back onto the state was part of a much larger development in the political

economy of commercial real estate in Chicago. Specifically, it constituted just one

example of a broad offensive waged by commercial real estate investors in the city

against a fiscal framework that they saw as increasingly hostile to their efforts to

maximize the profits from their respective landholdings.

When it came to property taxes, preferential treatment of firms with valuable real

estate was nothing new in cities like Chicago. As historian Frederic Cople Jaher notes, in

late-nineteenth-century Chicago, “the most consistent example of the ability of wealth to

manipulate government was the underassessment of real and personal property.” The

city’s elite regularly used political contributions and outright bribes to ensure “criminally

low” assessments, “thus favoring the rich and adding to the tax burden of the poor.”60

While this persisted well into the twentieth century, after the Second World War the

boom in middle-class homeownership fundamentally altered the politics of property taxes in Chicagoland. As historical sociologist Isaac Martin explains, the fact that homeowners became “a big, stable, and potentially loyal voting block” led policymakers in Chicago’s

Democratic machine to focus on granting them “informal tax privileges” in the form of artificially low assessments on their homes.61 Moreover, the new density of industrial

facilities in the wake of the war allowed local politicians to lean more heavily on those

60 Frederic Cople Jaher, The Urban Establishment: Upper Strata in Boston, New York, Charleston, Chicago, and Los Angeles (Urbana, IL: University of Illinois, 1982), 474-475, 503. Of course, Chicago was not alone in this regard. For example, historical sociologist Isaac William Martin tells of Andrew Mellon receiving “special tax treatment on his estate” in Pittsburgh during the early twentieth century. Isaac William Martin, Rich People’s Movements: Grassroots Campaigns to Untax the One Percent (New York, NY: Oxford University Press, 2013), 25.

61 Isaac William Martin, The Permanent Tax Revolt: How the Property Tax Transformed American Politics (Palo Alto, CA: Stanford University Press, 2008), 7, 57. 372

properties when it came to tax assessment, easing the burden on homeowners.62 As a result, at least until the early seventies assessors in Chicago and other American municipalities “traditionally treated homes more favorably than commercial property.”63

Several key developments during the 1970s formalized this favorable treatment of residential property in the Second City and surrounding suburbs. Early in the decade, a

Chicago-based community organization called the Citizens’ Action Committee (CAP) pressured legislators to act on behalf of elderly “low- and moderate-income homeowners in the city” who viewed escalating assessments on their homes as a “threat to their income security.”64 CAP’s grassroots mobilization and exposure of corruption at the

Cook County Assessor’s Office—namely egregiously low assessments granted to local steel companies—forced state legislators and county officials to act. During the early seventies, the Illinois General Assembly passed “homestead exemption,” “circuit breaker,” and “tax deferral” laws which decreased, capped, or allowed for postponement of property tax payments for senior citizen homeowners.65

62 For a helpful case study dealing with these issues in the context of California, see Robert Self, “Prelude to the Tax Revolt: The Politics of the ‘Tax Dollar’ in Postwar California,” in The New Suburban History, ed. Kevin Kruse and Thomas Sugrue (Chicago, IL: University of Chicago, 2006), 144-160. Illinois differed from California, however, in that Illinois voters never approved the sort of aggressive caps on tax rates and assessment increases instituted by California’s Proposition 13.

63 Martin, The Permanent Tax Revolt, 57.

64 Martin, The Permanent Tax Revolt, 65.

65 Martin, The Permanent Tax Revolt, 63-64; Clarence Lo, Small Property, Big Government: Social Origins of the Property Tax Revolt (Berkeley, CA: University of California Press, 1990), 18. For a helpful summary of this legislation, see John McCarron, “Property Taxes: Reach for a Pain Reliever,” Chicago Tribune, May 10, 2010, ProQuest. For details of the specific pieces of legislation, see Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, April 9, 1990), Municipal Reference Collection, Harold Washington Library Center; and Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, December 1997), Municipal Reference Collection, Harold Washington Library Center. 373

In addition to these “various exemptions, caps, and other gimmicks,” new

leadership at the Cook County Assessor’s Office responded to continued claims of

corruption and ongoing pressure from groups like CAP by emulating other municipalities

that had responded to similar criticism by “modernizing” their operations. This typically

meant the implementation of standardized training and computer models—Cook County

instituted these changes in 1973—in order to achieve more “objective” assessments.66

The new measures also included the adoption of an assessment “classification” system,

which allowed the county to set different “assessment levels” for residential and

commercial properties.67 Specifically, the new classification system stipulated that

residential properties be assessed at sixteen percent of their market value, and

commercial properties at forty percent. Ostensibly, the classification system, by assessing residential property at such a low fraction of its market value relative to commercial property, would “shift that tax burden away” from homeowners, towards holders of commercial and industrial real estate.68

The formalization of this favorable treatment of homeowners continued in the late seventies, as non-elderly residents rebelled against spikes in their property tax assessments. The new computerized assessment methods resulted in large jumps in

assessments across the board, and these jumps were made worse by dramatic increases in

66 McCarron, “Property Taxes;” Martin, The Permanent Tax Revolt, 93.

67 Martin, The Permanent Tax Revolt, 112.

68 State of Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, April 9, 1990), 141, 144, Municipal Reference Collection, Harold Washington Library Center. While Illinois permits any county with more than 200,000 residents to use a classification system, Illinois is the only one to have adopted the approach. Illinois Department of Revenue, The Illinois Property Tax System: A General Guide to the Local Property Tax System (Springfield, IL, n.d.), http://tax.illinois.gov/publications/localgovernment/ptax1004.pdf.

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home and land prices driven by steep inflation rates. In addition, the combination of increased spending on public goods like primary and secondary education and the departure of industrial firms placed pressure on assessors to demand more tax receipts from residential property owners.69 Furious middle-class (mostly suburban) homeowners organized under the banner of various libertarian organizations in Cook County to lobby state officials for a “property tax freeze” and, according to Martin, by 1977 they constituted a full-fledged “social movement.”70 While the movement fell short of securing legislation to place binding limitations on tax increases, the state did respond by passing legislation extending some of the benefits initially intended to protect elderly homeowners to homeowners in general.71

Needless to say, major commercial and industrial real estate interests in Chicago and Cook County did not find these developments to their liking. This was decidedly not

California, where the local tax revolts of the seventies ultimately resulted in the notorious

69 Martin, The Permanent Tax Revolt, 57, 65-66, 56, 12. Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, April 9, 1990), 11, 147, 165-166, Municipal Reference Collection, Harold Washington Library Center. Broader macroeconomic phenomena probably played an additional role in generating this outrage. Amidst the economic expansion of the 1950s and 60s, the share of total tax revenues in the U.S. drawn from corporate income decreased significantly. According to data from the Organization of Economic Cooperation and Development (OECD), between 1955 and 1975 the corporate income tax share of total tax revenues went from 20.3% to 11.4%. According to political economist Kenneth Thomas, “personal taxes rose to compensate, fueling the perception that Americans are highly taxed.” Kenneth Thomas, Competing for Capital: Europe and America in a Global Era (Washington, DC: Georgetown University Press, 2000), 7-8.

70 Martin, The Permanent Tax Revolt, 65.

71 Robert Kuttner, Revolt of the Haves: Tax Rebellions and Hard Times (New York, NY: Simon & Schuster, 1980), 300. For example, Illinois authorized a “general homestead exemption” in 1978. Douglas Whitley, “Is Proposition 13 for Illinois?,” Illinois Parks and Recreation 25 (May/June 1979), http://www.lib.niu.edu/1979/ip790508.html. For a helpful summary of the expanded legislation, see John McCarron, “Property Taxes: Reach for a Pain Reliever,” Chicago Tribune, May 10, 2010, ProQuest. For details of the specific pieces of legislation, see Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, April 9, 1990), Municipal Reference Collection, Harold Washington Library Center; and Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, December 1997), Municipal Reference Collection, Harold Washington Library Center. 375

Proposition 13, which “rolled back” and froze assessments and placed strict limits on tax

rate increases for both residential and commercial properties.72 As sociologist Clarence

Lo explains, the California tax rebels relied on a very particular leadership structure

which brought together “upper-middle-class” suburban homeowners with suburban small

business owners who shared a frustration with “government unresponsiveness.” In order

to find “common ground not only about means but ends,” the two constituencies agreed

to push through legislation that radically reduced current and future tax burdens on

homeowners as well as on businesses. Ironically, despite the fact that most major

commercial real estate holders in California opposed the legislation for fear that it would

spark a “backlash” in the form of increased business taxes, Proposition 13 ended up

benefiting them the most. According to Lo, “between 1978 and 1983 Proposition 13

reduced taxes by about $41 billion from what they otherwise would have been.

Homeowners received about 36 percent of the reduction [while] landlords, farmers, and

the owners of commercial and industrial real estate received 64 percent of the savings.”73

By contrast, in Cook County, much of the legislation sparked by local tax revolts

explicitly aimed to ease the property tax burden on residential properties. While the

beneficiaries no doubt included many affluent suburban homeowners, they also included

many homeowners of modest means struggling to pay their mortgage.74 The reform efforts in Illinois yielded some real mechanisms, however flawed, for what Lo calls

“downward redistribution” intended to help working- and middle-class residents stay

72 California Tax Data, “What Is Proposition 13?,” California Property Tax Information, n.d., http://www.californiataxdata.com/pdf/Prop13.pdf; Lo, Small Property Versus Big Government, 158.

73 Lo, Small Property Versus Big Government, 20-21, 154-158.

74 The general homestead exemption passed in 1978 quickly became the subject of controversy in Cook County after it became clear that non-owner-occupied rental properties were also benefiting from it. “Easing the Tax Bill Crunch,” Chicago Tribune, August 7, 1980, ProQuest. 376

afloat, as opposed to setting in motion the stark “upward redistribution” set in motion by

Prop. 13 in California.75 This fostered severe discontent among the business community in Chicago, especially investors with major stakes in local real estate. According to some estimates, they had good reason to believe that the property tax system in Cook County placed them at a distinct disadvantage relative to their counterparts on the west coast.

According to one set of estimates, by the late 1980s, commercial and industrial property accounted for less than a third of total market value of all property in Cook County, yet generated nearly sixty percent of the county’s property tax revenue.76

The politics undergirding this growing frustration among commercial property owners in Chicago also had a decidedly spatial element. The protracted decline of the city’s manufacturing base and the concomitant rise of nearby suburbs represented an existential threat to the profitability of central city real estate. Major commercial landholders in Chicago, especially those with assets in the Loop, quickly grew weary of a municipal finance structure in which their property tax payments appeared to be buttressing increasingly costly public services (esp. schools) for an increasingly

75 Lo, Small Property Versus Big Government, 20-21, 30-31. Also see Lo for a discussion of how the heterogeneity of tax revolts in the U.S. of the 1970s created dramatically different outcomes in different locales. Lo emphasizes the diverse array of ideological origins among tax rebels, and Isaac William Martin supplements this with an attention to the important role of American federalism and the fact that certain locales enjoyed more effective leadership or “movement entrepreneurs.” See Martin, The Permanent Tax Revolt; Martin, Rich People’s Movements.

76 State of Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, April 9, 1990), 147, Municipal Reference Collection, Harold Washington Library Center. It’s very likely that these statistics overstate the relative tax burden of commercial and industrial property in Cook County at the time. The same report goes on to explain that local assessors regularly underestimated the fair market value of commercial properties (94-95). This is discussed in more detail in “Cook County Tax Squeeze,” Chicago Tribune, November 10, 1985, ProQuest; Tim Novak and Mark Skertic, “Are Your Property Taxes Making You Say, ‘Ouch’?,” Chicago Sun-Times, July 5, 2002, NewsBank; and Mark Brown, “County Property Taxes Just Don’t Add Up,” Chicago Sun-Times, July 10, 2002, NewsBank. Moreover, business interests in Chicago and the rest of Illinois had successfully lobbied for an elimination of the corporate personal property tax during the 1970s. For more on this, see State of Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, April 9, 1990), 185, Municipal Reference Collection, Harold Washington Library Center.

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impoverished urban population, all at the same time that the tax bases of nearby

communities benefited from the influx of new residents and businesses.77 As documented

in Chapter One, by the 1980s influential firms and civic organizations like the Chicago

Central Area Committee (CCAC) were aggressively developing new growth strategies in

order to reverse the tide. Much like a rejuvenated urban branding campaign, fighting back

against the prevailing property tax structure became an important part of local

developers’ pro-growth toolbox.

Major downtown landholders like Hilton Hotels, local conservative policy organizations like the Civic Federation, as well as national pro-business associations like the Building Owners and Managers Association spearheaded concerted public relations, legal, and behind-the-scenes lobbying campaigns aimed at shifting Cook County’s tax burden back to homeowners.78 These local efforts succeeded on several fronts. In 1980

the Cook County Board approved a new ordinance allowing the Assessor’s Office to

grant commercial developers steep assessment reductions for building in areas “in need

of development,” and major developers—especially those active in or around the Loop—

quickly parlayed the new law into millions in tax savings, despite major questions about

whether or not many of the development sites genuinely met the “in need” criteria.79 In

77 For a useful summary of the links between the “urban crisis” and property taxation, see Thomas Sugrue, The Origins of the Urban Crisis: Race and Inequality in Postwar Detroit (Princeton, NJ: Princeton University Press, 1996), esp. xxii, 139.

78 See the collection of reports contained in the “Library” section of the Civic Federation’s website, available at: http://www.civicfed.org/library; Steve Kerch, “A Taxing Proposition,” Chicago Tribune, December 11, 1994, ProQuest.

79 The ordinance allowed for a drop in the assessment level from 40 to 16 percent for the first thirteen years. “A Tax-Incentive Rulebook,” Chicago Tribune, September 5, 1981, ProQuest. On specific examples of developers taking advantage of the ordinance, see John McCarron and Stanley Ziemba, “Developers Win 1st Tax Reduction,” Chicago Tribune, October 15, 1983, ProQuest; Stanley Ziemba, “West Side Center for Northern,” Chicago Tribune, July 13, 1988, ProQuest.

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addition, Cook County instituted modest reductions in the assessment level for

commercial property in 1986.80

State legislators in Illinois also responded to pressure from the real estate industry

and their political allies by expanding programs that reduced or limited the relative tax

burden for commercial properties. The Illinois Enterprise Zone Act of 1982 authorized

property tax abatements as part of a much larger basket of benefits for corporations

willing to invest in underdeveloped areas called “enterprise zones.”81 Contrary to the stated spirit of the legislation, it quickly emerged as a mechanism for offering huge tax breaks and direct subsidies in order to entice corporations considering a move to Illinois,

and to appease those threatening to leave. In many cases, the “zones” popped up in

neighborhoods with dubious claims to the urban blight required to qualify for the

program, or where redevelopment was already imminent. At the time of this writing the

City of Chicago contains six distinct Illinois State Enterprise Zones, two of which overlap

with or are adjacent to gentrifying or gentrified neighborhoods in close proximity to the

Loop (e.g. the Near West Side, West Town, and even portions of Lincoln Park), and one

of which abuts the University of Chicago in Hyde Park (a prized site for local

developers). In some cases, local officials in Chicago guaranteed supplemental property

tax breaks in order sweeten other state “incentive” programs, as happened in 2001 when

the city granted Boeing a 20-year abatement deal worth $16 million as part of a

80 Larry Cose, “Businesses Get Assessment Cut,” Chicago Sun-Times, May 20, 1986, NewsBank,

81 Jeff McCourt and Greg LeRoy, A Better Deal for Illinois: Improving Economic Development Policy (Washington, DC: Good Jobs First, January 2003), 1; John Gorman, “Illinois Gears Up to Land GM’s Saturn Project,” Chicago Tribune, January 24, 1985. This sort of state “enterprise zone” legislation was a pre-runner to, but legislatively distinct from the federal “enterprise zone” and “empowerment zone” legislation passed under the Clinton administration in 1993. See Karen Mossberger, The Politics of Ideas and the Spread of Enterprise Zones (Washington, DC: Georgetown University Press, 2000). 379

successful bid to convince the aerospace company to relocate its headquarters to the city.82

The limited data available on changes in local tax rates of different classes of property in Cook County and Chicago suggest that the business counteroffensive had the intended effect. Aggregate tax rates in Cook County (Table 6.3) increased across the board during most of the eighties, but much less so for commercial property owners. By the early nineties, the rates had started to fall, and rates for commercial properties declined at a much faster rate. While effective tax rates on commercial and industrial

82 Illinois State Enterprise Zone Maps downloaded from Illinois Department of Commerce and Economic Opportunity, “Individual Enterprise Zone Maps, May 2013,” accessed September 15, 2013, http://www.ildceo.net/dceo/Bureaus/Business_Development/Tax+Assistance/EZ+Maps+05.08.2013.htm. Boeing benefited from approximately $56 million in combined city and state subsidies through the deal. The state component was passed under the name “Corporate Headquarters Relocation Act.” “Illinois Stalkers Can Go to Prison,” Chicago Tribune, August 2, 2001, ProQuest. McCourt and LeRoy, A Better Deal for Illinois, 1, 58. Perhaps the most infamous but least understood example of the City of Chicago reshaping the property tax system to expand subsidies for major land developers came after Illinois authorized the use of Tax Increment Financing (TIF) districts in 1977. In theory, TIF works like this: a municipality issues bonds and uses the proceeds to fund subsidies for private real estate development in “blighted” areas, or TIF districts, where investors would otherwise avoid. When an area receives TIF designation, local authorities freeze the amount of property taxes collected by taxing bodies like schools from all property in the TIF district. In Chicago TIF districts, any annual property tax revenue increases above the frozen level are used to pay back the loans for the initial subsidies or deposited in a centralized TIF-fund controlled by the mayor. As local journalists like Ben Joravsky have chronicled in detail, under the second Mayor Daley the TIF program became a poorly monitored cash machine for major corporations looking for subsidies. Companies like RJR Nabisco, Federal Express, and Home Depot nabbed hundreds of millions in TIF handouts during the nineties, and the city frequently authorized the subsidies for development in areas like the Loop, which were anything but “blighted.” In other words, the city effectively diverted revenue generated by growth in the tax base in districts where additional investment was imminent—even without subsidies—away from schools and into the pockets of developers. On the legislative history of TIF in Illinois, see Don Davis, “Tax Increment Financing,” Public Budgeting & Finance 9, no. 1 (Spring 1989): 63-73. To access Joravsky’s writing on the subject, see The Chicago Reader TIF Archive, http://www.chicagoreader.com/chicago/the-chicago-reader-tif- archive/Content?oid=1180567. Between 1996 and 2000, the city allocated at least $75 million (constant 2000 dollars) for TIF projects in the “Central Loop” TIF district downtown. Data retrieved from Good Jobs First, Subsidy Tracker, accessed August 10, 2013, http://www.goodjobsfirst.org/subsidy-tracker. For a particularly helpful discussion of how the TIF program affects the fiscal position of public schools in Chicago, see Robert Bruno and Alison Dickson Quesada, Tax Increment Financing and Chicago Public Schools: A New Approach to Comprehending a Complex Relationship, University of Illinois at Urbana- Champaign Labor Education Program White Paper Series (Urbana, IL: University of Illinois at Urbana- Champaign, December 2011).

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property in Chicago plummeted during the 2000s (Table 6.4), regular homeowners saw virtually no change.83

Table 6.3. Percentage Changes in Aggregate Property Tax Rate, Cook County, 1981-1994a Period Total Residential Commercial 1981-87 7.20 8.30 4.70 1988-94 -1.54 -1.90 -2.40 Source: Illinois Economic and Fiscal Commission (1990, 1997). a “Aggregate property tax rate” is the ratio of total property tax extensions (i.e. tax bills) to total equalized assessed value. In other words it is the ratio between total tax bills and market value as determined by local assessment formulas. These rates not available for Chicago city alone.

Table 6.4. Effective Property Tax Rates, City of Chicago, Tax Years 1992-2009a Tax Year Residential Commercial Industrial 1992 1.55 4.31 5.85 No data available 1993-1998 1999 1.51 4.61 4.34 2000 1.47 3.88 2.91 2001 1.34 3.12 2.95 2002 1.27 3.27 2.05 2003 1.39 3.01 1.76 2004 1.29 2.25 1.90 2005 1.21 2.37 1.84 2006 1.29 1.87 1.24 2007 1.25 2.20 1.49 2008 1.31 2.35 1.61 2009 1.45 2.43 n/a Sources: Civic Federation (1994, 2011). a “Effective property tax rate” based on calculations by the Civic Federation which incorporate actual sales data in addition to assessment data. That is, these rates take into account the real-life sale prices of properties or comparable properties in determining market value (i.e. the denominator in the tax rate ratio). As a result, they are likely a more accurate representation of actual liabilities than “aggregate tax rate” numbers. See Civic Federation reports cited above for more on their methodology.

It’s worth clarifying here that these efforts by commercial real estate investors like Reinsdorf and Wirtz did not, in and of themselves, constitute a “social movement” in the classical sense of the term. Unlike the local property tax revolts of the seventies,

83 For more on the shift of the property tax burden from business to homeowners, see Greg Hinz, “Biz Tax Load Gets Lighter,” Crain’s Chicago Business, August 16, 2006, ProQuest; Greg Hinz, “Surprise! Illinois Biz Taxes Below Average, Study Says,” Crain’s Chicago Business, May 9, 2013, ProQuest. 381

which were sparked by acute “policy threats” (i.e. sudden assessment spikes) and

depended on the tactics of “grassroots politics” and “drawing attention to themselves,”

the expanding menu of breaks on commercial and industrial property taxes in Illinois and

Chicago emerged largely as a result of behind-the-scenes lobbying by specific corporations and/or industries. As Martin explains, this has historically been the default mode of political action by economic elites seeking favorable terms of taxation, since more overt or collective approaches risk drawing unwanted public attention and oversight. The United Center tax deal was the quintessential example of this

“particularistic” approach to remodeling local property tax codes, and when grouped together with the litany of breaks secured by firms outside the pro sports business, it represented a significant transformation of the structure of local fiscal policy.84

But even if on their own the efforts of Reinsdorf, Wirtz, and the rest of Chicago’s commercial real estate investors did not constitute a “social movement,” they were nonetheless a local manifestation in Cook County and Illinois of a national drive by a

diverse array of pro-business interests to radically reshape the relationship between

corporations and the government. Economist James K. Galbraith argues that the crisis of profitability faced by the postwar corporate order during the 1970s created the impetus for a changed relationship between government and big business. In the decades

immediately following the war, Galbraith explains, the state-business nexus “was defined as one sometimes of conflict but also of collaboration.” “There were moments,” he admits, “when the government and the country’s leading companies faced off. But there

84 Martin, Rich People’s Movements, 16-17, 8-12. 382

were other moments…when public and private power were harnessed together, more or

less in collaboration, with the government, not the corporation, in a leadership role.”85

In Galbraith’s telling, by the end of the 1970s, the “countervailing power” of the

state which previously placed important limits on corporate behavior was wilting rapidly

under the weight of a full frontal assault by a business class “set out to take over the state

and run it…in the way that would bring to them…the most money, the least disturbed

power, and the greatest chance of rescue should something go wrong.”86 Slashing

corporate tax burdens and expanding “incentive” programs for business, which would

allegedly spur investment and unleash a downward “trickle” of economic benefits for

society as a whole, constituted key objectives of this assault. As historian Kim Phillips-

Fein shows, these objectives served as consistent motivation for a vanguard of

reactionary corporate leaders who never accepted the relatively progressive fiscal policy

ushered in by the New Deal. By the late 1970s, these leaders had organized a formidable,

national conservative movement supported by a sweeping network of propaganda outlets,

political action committees, and pro-growth associations.87 As these conservatives and

their allies secured seats at all levels of government, and as the Democratic Party reacted

by more readily embracing the legislative desires of business so as not to find itself on the

outside looking in, fiscal policy aimed at absorbing the risk of private investment

proliferated at all legislative levels. Between 1977 and 1993, for example, the number of

85 James K. Galbraith, The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too (New York: The Free Press, 2009), 129.

86 Galbraith, The Predator State, 126, 131.

87 Kim Philips-Fein, Invisible Hands: The Making of the Conservative Movement from the New Deal to Reagan (New York, NY: W.W. Norton, 2009). For a succinct summary of the economic ideology undergirding this movement, see Arthur MacEwan and John Miller, Economic Collapse, Economic Change: Getting to the Roots of the Crisis (Armonk, NY: M.E. Sharpe, 2011), 55-57.

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states offering corporations special “incentive” programs involving some form of

property tax abatement jumped from 28 to 41.88

According to political economist Kenneth Thomas, this legislation resulted in a

massive expansion of “tax expenditure” subsidies (i.e. indirect subsidies via abatements

or exemptions) for favored corporations and developers. While government agencies in

the U.S. have failed to maintain systematic records of such subsidies, we know that by

the mid-1990s, it was common for cities much smaller than Chicago to dole out hundreds

of millions of dollars in property tax abatements to corporations each year.89 These staggering amounts owed both to the ongoing political influence of “corporate welfare” enthusiasts, and to the negative fiscal feedback loops created by the subsidies themselves: as cities and states offered more and more benefits to big business, they limited the growth of the local tax base, which in turn increased these locales’ desperation for new investment, leading them to offer even bigger subsidies to attract or retain corporations.90

As policy watchdogs have discovered, local, state, and national governments

rarely made binding demands such as quotas for permanent job creation in exchange for

these handouts.91 In this larger context, Reinsdorf’s and Wirtz’s success in securing

88 Greg LeRoy, No More Candy Store: States and Cities Making Job Subsidies Accountable (Washington, DC: Good Jobs First, 1997), 3. For lucid accounts of some of the more infamous examples of this sort of legislation, see Johnston, Perfectly Legal. For details on the expansion of other types of state-level “incentive” programs, see Table 1 in Terry Buss, “The Effect of State Tax Incentives on Economic Growth and Firm Location Decisions: An Overview of the Literature,” Economic Development Quarterly 15, no. 1 (February 2001): 92.

89 Thomas, Competing for Capital, 150-161.

90 Logan and Molotch, Urban Fortunes, 245.

91 Good Jobs First, No More Candy Store, 17. Not only have these major subsidy deals produced lackluster economic impacts in many—if not most—cases, but the evidence as to whether or not such incentive deals actually function as important draws for relocating firms is decidedly mixed. Many econometric analyses show that they do have an impact, but others show zero or even negative impact. Generally speaking, the effects of incentives appear to be higher for intrametropolitan competition for investment than interstate or 384

subsidies for the United Center without guaranteeing local government a share of arena-

generated revenues or a say in operational decisions was not just about a new era in

stadium finance. It represented the professional sports business’s participation in a

redefined system of accumulation in which public subsidies for the private development

of land expanded while public rights to the fruits of those subsidies evaporated.

The point of this detour through the recent history of taxation is to underscore the

fact that the United Center tax breaks were anything but unique in terms of urban firms’

growth strategies at the end of the twentieth century. By the time the General Assembly

wrote the breaks into law in 1989, the city and state were already expanding efforts to use fiscal policy to reduce the risk of investment borne by well-connected corporations and

developers from a wide variety of economic sectors. Moreover, lobbying for—and in the

process convincing the state to institutionalize—large property tax abatements and

exemptions constituted an important tactic used by businesses across the U.S. intent on

realigning local property tax systems with their growth agendas and lowering commercial

property tax rates they perceived as stubbornly high. That the United Center profited

from this sort of preferential fiscal policy is less a testament to the exceptional monopoly

power enjoyed by pro leagues and teams, and more an indication that those teams and

interregional competition (which makes sense since, in the case of the former, it is more likely that all else is equal between locations and taxes act as a tie-breaker). For a critical survey of existing scholarship, see Buss, “The Effect of State Tax Incentives on Economic Growth.” For a slightly more optimistic review of the effects of these incentives, see Joseph Phillips and Ernest Goss, “The Effect of State and Local Taxes on Economic Development: A Meta-Analysis,” Southern Economic Journal 62, no. 2 (October 1995): 320- 333. Interestingly, local government and even conservative fiscal policy think tanks have raised doubts about the soundness of these incentives as economic development tools. See Illinois Economic and Fiscal Commission, Property Tax in Illinois: Selected Problems and Proposals (Springfield, IL, May 1973), 46- 60; Donald Haider, Business Location, Taxes, and Property Taxes (Chicago, IL: Civic Federation, August 18, 1998). For interesting anecdotal evidence on the relative unimportance of tax incentives, see Rebecca Carr, “Cook Tax Gap Grows,” Crain’s Chicago Business, September 11, 1989, 2013, ProQuest. 385

leagues embraced the economic and political strategies developed by major real estate

interests at the end of the twentieth century.

This is not to say that the NBA’s power to limit franchise supply and teams’

willingness to use this market structure as a source of political leverage were irrelevant in

enlisting local government as willing but unequal partners in stadium finance. And there

is no doubt that the increasingly popular, if misguided tendency among American cities

to view major league status as a prerequisite for growth at the end of the twentieth

century made local governments particularly vulnerable to exploitation by team owners

like Reinsdorf and Wirtz. But for the Bulls and other franchises that secured what

amounted to free public subsidies, the ability to capitalize so completely on their market

position depended first and foremost on structural shifts in the relationship between

business and government during the 1970s and 80s.

What ultimately tied together firms like the Chicago Bulls, Boeing, and Sears,

was their commitment to shifting as much of the costs of growth as possible onto

homeowners (of all socioeconomic stripes) and the poor, who paid either through increasing tax bills or reduced government services.92 Clearly, the list of losers in the

United Center saga included not only peanut vendors and low-income residents in West

Haven, but also working- and middle-class homeowners and renters in Chicago and Cook

County.93 As if the consequences for these groups weren’t already enough, local officials

92 This relationship—between abatements and redistribution of the tax load—is not as straightforward and intuitive as it might sound. For more on this and the mechanics of the property tax cycle, see Appendix B. There is also a helpful visualization of the cycle in State of Illinois Economic and Fiscal Commission, Report to the Illinois General Assembly on Property Tax (Springfield, IL, April 9, 1990), 64, Municipal Reference Collection, Harold Washington Library Center. For a discussion of how property tax abatemetns contribute to increased socioeconomic inequity, see Thomas, Competing for Capital.

93 It’s worth noting here that property-owners in low-income areas were, proportionally, affected more by these sorts of arrangements. See “The Taxman Takes His Biggest Bite in Blighted Areas,” Chicago 386

provided United Center ownership with several other tax abatement mechanisms for

limiting the private costs of financing and operating the arena.

When More Just Isn’t Good Enough: The United Center, Amusement Taxes, and Tax Appeals

In May 1991, the Sun-Times reported matter-of-factly that the City Council had agreed, under pressure from Reinsdorf and Wirtz, to exempt forty percent of the revenue produced by United Center luxury boxes from Chicago’s amusement tax, which normally required professional sports facilities and other entertainment venues to transfer four percent of the proceeds from ticket sales to the city.94 On May 22, the Chicago City

Council amended the municipal code to read, “the [amusement] tax shall apply to and be imposed upon 60% of the admission fees or other charges paid for the privilege of using special [skybox] seating areas to witness or to view an amusement.”95

Just as they would do several years later when Chuck Neubauer confronted them

about the property tax deal, United Center officials insisted that the amusement tax breaks were a prerequisite for private financing of the new arena. “The lenders wouldn’t agree to anything less,” Reinsdorf’s spokesperson Howard Pizer told the Sun-Times right before the City Council approved the amendment.96 As with similar claims in relation to

the property tax breaks, this was misleading. Credit lines for construction of the United

Tribune, May 19, 1973, ProQuest; and James Yuenger, “Assessor is Facing Black Protest Blitz,” Chicago Tribune, August 5, 1979, ProQuest.

94 Fran Spielman, “$160 Million Plan for a New Stadium,” Chicago Sun-Times, May 9, 1991, NewsBank.

95 “Amendment of Title 4, Chapter 16, Sections 010 and 020 of Municipal Code of Chicago by Defining Special Seating Areas and Imposing Applicable City Amusement Tax,” Journal of the City Council, May 22, 1991, 334-336, Municipal Reference Collection, Harold Washington Library Center.

96 Fran Spielman, “Aldermen Join Stadium Push,” Chicago Sun-Times, May 21, 1991, NewsBank. The amusement tax—an excise tax—applied to tickets for movies, concerts, sports games, theater productions, and movie rentals. See “Mark Brown and Ray Long, “How Taxes Take Their Heavy Toll,” Chicago Sun- Times, May 5, 1991, NewsBank. 387

Center were not contingent on an amusement tax break; however, lower interest rates on those lines of credit were. Like the property tax reduction, the amusement tax breaks represented a rarely-reported subsidy largely outside the orbit of public scrutiny. It not only allowed Reinsdorf and Wirtz to shirk two fifths of standard amusement tax liabilities on skybox revenues and re-direct the savings to other investments, but also helped them secure even cheaper credit.97

Unfortunately, complete data on annual skybox revenues since the United Center opened in 1994 are not available to the public. However, records at the Cook County

Board of Review do contain the numbers for fiscal years 2002-2007.98 Over this six-year period, the amusement tax breaks saved Reinsdorf and Wirtz over $4.6 million (in constant 2007 dollars), and this figure would have been considerably higher had the

National Hockey League not suffered a work stoppage during 2004 and 2005 (for calculations, see Appendix C).99 While worth much less than the property tax abatements, these breaks still represented significant savings for the owners over the long term. They thus owed their privileged position with regard to tax liabilities not just to the

97 One might assume that the amusement tax breaks, since they applied exclusively to luxury box rentals, constituted a subsidy for rich luxury box leaseholders (i.e. that the breaks allowed for lower prices on box rentals since the Bulls and Blackhawks could afford to pass on fewer tax costs to consumers). However, this probably wasn’t the case. Anecdotal accounts by local team owners in Chicago suggest that teams charged whatever the market would bear regardless of the applicable amusement tax legislation. See, for example, John Kass, “Aldermen Become Fans,” Chicago Tribune, December 4, 1992, ProQuest.

98 “Fiscal year” denotes the year in which the taxable revenue was produced. This differs from the label “tax year” used above to discuss property taxes. Since commercial property tax assessments executed during a “tax year” are based on income generated in prior years, and bills are not released until the year after the “tax year,” there is at least a two year gap between when a property generates income and when a bill for tax on that income is issued/paid. In the case of excise taxes like the amusement tax, the merchant is billed the year after the taxable revenue is produced (i.e. the year after the “fiscal year”).

99 See Appendix C. Data obtained from Cook County Board of Review, Freedom of Information Act Request #WCB081711, August 17, 2011. Again, the “savings” calculations are do not take into account present discounted value. As a result, they underestimate the overall financial benefits that accrued to Reinsdorf and Wirtz as a result of the amusement tax breaks. 388

Illinois General Assembly, but also to the aldermen who made up Chicago’s City

Council.

It’s important to understand the amusement tax breaks in the context of the

broader history of municipal finance in Chicago during the 1990s. The amusement tax

had a long history; the city had collected it since 1947. However, the combination of

steep declines in federal aid to cities and growing hostility on the part of homeowners and

business to property tax hikes pushed the Mayor’s Office and City Council to increase

existing excise taxes and non-tax fees (e.g. permits, fines, etc.), as well as to create new

ones altogether.100 Between 1983 and 1992, property tax levies within the city of Chicago

continued to rise—28.5% when adjusted for inflation—in line with education costs, but

over the same period revenues from excises and fees went up at a faster rate (33%) in

order to help offset the nearly 23% fall in receipts from intergovernmental revenue.101

Over the course of the next two decades, Mayor Daley and the Cook County Board introduced new taxes on items like diesel fuel, instituted rate increases on existing excises

like the amusement tax, and raised surcharges collected from city residents to help cover

the costs of public utilities.102

100 Gary Washburn, “Chicago to Take Lesser Cut so It Won’t Lose Big Shows,” Chicago Tribune, March 10, 1999, ProQuest; “Budget Uses Levies for Leverage,” Chicago Tribune, November 20, 1983, ProQuest.

101 These levies include all taxing bodies, including parks, schools, community colleges, etc. Civic Federation, Chicagoland—A Fiscal Perspective 1983-1992 (Chicago, IL: Civic Federation, September 1994), 25-27, 72, 78.

102 Nancy Ryan and John Kass, “Daley Budget Plan OK’d,” Chicago Tribune, November 16, 1995, ProQuest; Mark Brown, “County Board Oks $43 Million Hike in ’97 Budget,” Chicago Sun-Times, November 23, 1996, NewsBank; Jim Allen, “With No New Taxes in Store, Daley Unveils New Budget,” Daily Herald, October 9, 1997, ProQuest; Fran Spielman, “Budget Woes,” Chicago Sun-Times, October 6, 2004, NewsBank; Fran Spielman, “Daley Planning More Taxes, Fees,” Chicago Sun-Times, September 17, 2005, NewsBank. According to a 2002 report by the Institute of Taxation and Economic Policy, these actions in Illinois’ biggest population center helped ensure that, by the end of the century, the state depended far more than most on what it described as “extremely regressive” excise taxes. Matthew Gardner et al., Balancing Act: Tax Reform Options in Illinois (Washington, D.C.: Institute of Taxation and 389

Daley embraced amusement tax hikes because he could claim that they targeted

suburbanites and tourists coming into the city for games and concerts.103 Reinsdorf and

Wirtz, however, clearly loathed the idea of positioning the professional sports business as

a fiscal stimulus for the city, despite the fact that the property tax breaks granted to major

commercial properties like the United Center exacerbated the budget shortfalls the new

taxes were intended to address. The owners’ move to exempt forty percent of skybox

receipts from the jurisdiction of excise tax collectors is best seen as a calculated effort to

insulate their teams from the predictable push by the city to make up for sizeable budget

shortfalls by asking more of local entertainment venues. In effect, they used their

influence to block all avenues through which the state might saddle them with additional

investment risk.104

Even with the partial skybox exemption, Reinsdorf and Wirtz lobbied

aggressively to block amusement tax rate increases by the city and county. Each and

every time the City Council or County Board considered raising amusement tax rates,

United Center officials immediately pushed back by signing irate letters, issuing formal

complaints at public hearings, making statements to the local media, and, of course,

pressuring local officials behind closed doors.105 The logic presented by arena ownership

in support of their opposition was comical and offensive at the same time. In 1996 the

Economic Policy 2002), 3. The 2002 report also rated Chicago as second worst in terms of total sales tax burden, just behind the District of Columbia (49).

103 Jim Allen, “With No New Taxes in Store, Daley Unveils New Budget,” Daily Herald, October 9, 1997, ProQuest.

104 United Center ownership was no newcomer to opposition against the amusement tax. Wirtz had been complaining about the levy at the old Chicago Stadium since at least the late 1980s. See Ray Sons, “Stadium Feud,” Chicago Sun-Times, July 24, 1988, NewsBank.

105 Fran Spielman, “Pro Sports Execs Balk at ‘Fun Tax’ Hike,” Chicago Sun-Times, December 4, 1992, NewsBank; John Kass, “Aldermen Become Fans,” Chicago Tribune, December 4, 1992, ProQuest; “Daley Asks Fun-Seekers to Help City Pay Bills,” Chicago Sun-Times, October 23, 1994, NewsBank. 390

Tribune reported that after he proposed a new county-level amusement tax, Cook County

Board President John Stroger “got an angry phone call” from Reinsdorf, who was

apparently “upset that Stroger would suggest such a tax when his teams already have

been suffering from accusations that their tickets are overpriced.” Of course, the tickets

were overpriced by most Chicagoans’ standards. Reinsdorf opposed the tax because he understood that, given prices were as high as local demand would allow, increased amusement taxes would have to come out of his pockets rather than from higher ticket prices. Howard Pizer, correctly assuming that few Chicagoans realized the extent of the tax relief already enjoyed by his bosses, added that “his industry was being asked by government to shoulder too much of a burden.”106

Government action on behalf of Reinsdorf and Wirtz’s fiscal priorities did not end

with state legislators and local alderman. The Cook County Assessor’s Office and the

Cook County Board of Review, the agencies tasked with valuing real estate in Chicago,

have done more to inoculate the owners from financial risk than simply enforce the

special assessment formula mandated by the state. These entities have facilitated the

further reduction of United Center property tax bills by acceding to several appeals made

by the owners through a formal process used by some property owners to contest their

assessments. If the owner of a parcel of land disagrees with its assessed value according

to the Assessor’s Office, they can submit a formal appeal, or pay a lawyer to submit one

for them. If the Assessor’s ruling on the appeal is not to the property owner’s liking, they

can forward their appeal to the Board of Review for further consideration. Even with

106 Andrew Fegelman, “Some Not Amused by County Tax,” Chicago Tribune, November 16, 1996, ProQuest. 391

incredibly low property tax liabilities already locked in, year after year Reinsdorf and

Wirtz tasked their attorneys with securing additional savings through the appeals process.

Unfortunately, the Assessor’s Office and Board of Review only maintain appeals records going back a few years, and the available records are often incomplete or lack adequate codebooks for deciphering the information. Nevertheless, we have access to

enough data to know that, from tax years 2000 to 2012, United Center lawyers appealed

the arena’s property tax bill to the Cook County Assessor at least six times (i.e. every

other year, on average). Not all of these appeals succeeded, but many did, and sometimes

success meant big savings for Reinsdorf and Wirtz. For example, in tax year 2006,

presumably based on the rationale that the assessor had overestimated the arena’s income

by not accounting for revenue lost due to the recent NHL lockout, the Assessor’s Office

reduced the original valuation of the United Center by nearly $3.5 million. This translated

into $494,000 in savings on top of the abatements guaranteed by the special assessment

formula.107

Reinsdorf and Wirtz have truly left no stone unturned when it comes to using the

appeals process to minimize their share of the overall tax burden. As Map 6.1 shows,

their lawyers appealed initial valuations on no fewer than 84 of the 87 parcels

constituting United Center property for the 2006 tax year, and we have no reason to

believe this was anything but standard practice. From $23 dollars for a sliver of parking

107 Author’s calculations based on data from Cook County Assessor’s Office, “Property Search,” http://www.cookcountyassessor.com/Property_Search/Property_Search.aspx. Appeals decision letters obtained from Cook County Assessor’s Office, Freedom of Information Act request, work order no. 62939, transaction no. 62013, March 28, 2013. It’s worth noting that the only reason the revenue statements on which Figure 6.1 are contained in the public record is that they were submitted to the Assessor’s Office in support of appeals dockets filed by United Center lawyers. It also bears mention that Wrigley Field received no significant reduction of property taxes as a result of 1994-95 work stoppage in Major League Baseball. See Figure 6.3.

392

lot to upwards of $30,000 for the large parcels containing the actual arena, the savings

added up quickly. Moreover, if the response of the Assessor’s Office failed to satisfy the

owners, they did not hesitate to take their appeal one step further to the Board of Review.

Public information on Board of Review claims is even spottier, but Reinsdorf and Wirtz’s

lawyers definitely filed appeals with the board in 2004 and 2008 (winning in 2004).108

Map 6.1. Property Tax Savings by Parcel for United Center, Tax Year 2006. Sources: Cook County Assessor’s Office, “Property Search.” Parcel shapefiles provided by Chicago Metropolitan Agency for Planning (2001, 2005). Basemaps provided by Esri.

Not surprisingly, filing these appeals on a property like the United Center

involved the efforts of “clout-heavy lawyers who [fought] to get tax cuts for the city’s

most prominent building owners.”109 The firms representing Reinsdorf and Wirtz in their

appeals have included high-profile outfits like Katten, Muchin Zavis and Tully &

108 Appeals histories obtained from Cook County Assessor’s Office, “Property Search.” Appeals histories for the Board of Review obtained from Cook County Board of Review, Freedom of Information Act Request #WCB081711, August 17, 2011.

109 Fran Spielman, “Daley Wants Tax Review Role,” Chicago Sun-Times, Septermber 4, 2002, NewsBank. 393

Associates, where partners possess intricate knowledge of the local property tax system

as a result of previous posts at the Cook County Assessor’s Office. In fact, Thomas Tully,

the lead partner at Tully & Associates, headed the Assessor’s Office from 1974-1978.110

Having knowledgeable insiders like Tully on their side has ensured that the arena owners

enjoy the fruits of every last loophole, exemption, or ambiguously-written piece of municipal code or legislation.

By the nineties, using the appeals process to cut property tax bills was a well-

worn tradition among well-connected Chicagoans. A 1973 report on property taxation in

Illinois by the state’s Economic and Fiscal Commission acknowledged that the appeals

processes in Cook County favored those with friends in government and/or the money to

retain powerful law firms. According to the report, “the appeals process, though well

defined, is difficult for the tax payer who does not have resources or technical

knowledge.”111 But while the process had long conferred advantages on the wealthy, it

assumed increased importance for large real estate interests as a result of the

aforementioned efforts by regular homeowners during the seventies and eighties to

ensure that commercial property holders assumed a bigger chunk of the property tax

burden. In order to offset legislation enacting pro-homeowner classification and exemption schemes, corporate landholders in Chicago and Cook County redoubled their efforts when it came to appeals. For example, from 1973 to 1981, the nominal assessment reductions granted by Cook County Board of Review (then referred to as the “Cook

110 Fran Spielman, “Daley Wants Tax Review Role.” Correspondence between Tully’s firm and the Assessor’s Office concerning the United Center obtained from Cook County Assessor’s Office, Freedom of Information Act Request, work order no. 62939, transaction no. 62013, March 28, 2013. Coincidentally, Mark Weinberg (the attorney for the peanut vendors discussed in the previous chapter) worked for Katten Muchin Zavis before starting The Blue Line.

111 Illinois Economic and Fiscal Commission, Property Tax in Illinois: Selected Problems and Proposals (Springfield, IL, May 1973), S-1. 394

County Appeals Board”) skyrocketed from less than $100 million to nearly $450 million,

and the Tribune reported that 90% of the reductions went to commercial properties.112

A significant portion of this jump owed to rampant corruption within both the

Assessor’s Office and Board of Review during the seventies. Forged documents, bribery

scandals, and political favors riddled their offices until 1984, when insurgents within the

local Democratic Party connected to Harold Washington assumed important leadership

positions there.113 While these reformers succeeded in curbing the extent of assessment

reductions, their success died along with the Washington administration, and by the

1990s business elites like Reinsdorf and Wirtz had thoroughly revived the appeals

process as a counterweight to efforts by homeowners to shift the property tax burden to

the commercial real estate sector. Between 1985 and 1995, the total annual reduction in

assessments (nominal) granted by the Board of Review climbed more than 400%, from

$77 million to $393 million.114 Reports of outright corruption were relatively few in this

era, but the Tribune noted in 1990 that the resurgence in tax savings via appeals owed

much to the rapid expansion of “property tax [appeal] services…as an in-demand

specialty in the real estate industry, a specialty that consultants, accountants, attorneys

112 John McCarron, “County Cuts Tax Breaks on Commercial Property,” Chicago Tribune, July 4, 1983, ProQuest. These years correspond to the tax bills payable in 1974 through 1982.

113 On the corruption surrounding real estate assessment in Cook County during the seventies, see George Ellis and John O’Brien, “Double Tax Break for Pols’ Friends,” Chicago Tribune, March 31, 1973, ProQuest; Ed McManus, “Business Taxes Cut, Burden Falls on Homeowners, Chicago Tribune, March 19, 1978, ProQuest; Chuck Neubauer, “Tully Cuts in Taxes Saved Kennedy Families Millions,” Chicago Tribune, May 14, 1980, ProQuest; Ed McManus, “Tax Appeals Case—23 Convictions Later,” Chicago Tribune, September 11, 1983, ProQuest. On the reform efforts of Washington allies like Patrick Quinn, see John McCarron, “County Cuts Tax Breaks on Commercial Property,” Chicago Tribune, July 4, 1983, ProQuest; David Axelrod, “Tax Appeals Race Test for ‘The New Politics,” Chicago Tribune, March 18, 1984, ProQuest.

114 Figures not adjusted for inflation. Note that the total EAV for Cook went up only 100% during the same period. Roland Calia and Susan Fortin, Cook County Property Taxes, Assessments and Appeals 1995 (Chicago, IL: Civic Federation, October 1997), 21. 395

and brokers are moving to fill.” The growing “cottage industry” of appeals specialists like the ones hired by the United Center meant bigger assessment reductions for more businesses. By 2002, at least three Cook County law firms won more than $9 million in total reductions for their clients.115 Not surprisingly, the vast majority of these savings went to owners of commercial and industrial property.116 According to a 2006 Tribune investigation, the number of Board of Review rulings offering assessment reductions in excess of $1 million skyrocketed from seven in 1996 to one hundred and seventy-eight in

2006. In many cases, the assessment cuts were big enough to yield savings in excess of

$1 million on the property owner’s tax bills.117

Taken together, the special assessment formula, the amusement tax breaks, and the appeals to the Assessor’s Office and Board of Review demonstrate that United Center ownership convinced officials at every level of local government—state, county, and city—to intervene on their behalf in order to reduce the risk posed to the arena’s profitability by normal taxation. Reinsdorf and Wirtz presciently used their relationships with government officials to shut off any channel through which the city might act to

115 Steve Kerch, “Its Appeal Is Growing,” Chicago Tribune, November 25, 1990, ProQuest; Mark Brown, “County Property Taxes Just Don’t Add Up,” Chicago Sun-Times, July 10, 2002, NewsBank; and “Put a Spotlight on Tax Appeals,” Chicago Tribune, October 25, 2006, ProQuest.

116 Between 2000 and 2008, for example, the average percentage of total original assessed value reduced as a result of appeals to the Cook County Assessor was 0.6% for residential properties, and 8.1% for non- residential (i.e. commercial, industrial, and apartment building with more than six units). For appeals to the Cook County Board of Review, the numbers were 1.0% and 4.7%, respectively. Data obtained from Civic Federation, Cook County Property Taxes and Appeals: A Primer on the Appeals Process with Data from 2000-2008 (Chicago, IL: Civic Federation, 2009).

117 Tim Novak and Mark Skertic, “Are Your Property Taxes Making You Say, ‘Ouch’?,” Chicago Sun- Times, July 5, 2002, NewsBank; “Put a Spotlight on Tax Appeals,” Chicago Tribune, October 25, 2006, ProQuest. Researchers at UNITE-HERE have also uncovered major savings-via-appeals for local elites who contest their residential assessments. See Elliott Mallen, Tax Relief for Billionaires: Property Taxes and the Pritzker Family (UNITE-HERE, 2012), http://www.hyatthurts.org/wp- content/uploads/TaxReliefforBillionaires.pdf. For a very recent controversy surrounding valuable appeals won by the law firm run by 14th Ward Alderman Ed Burke, see Tim Novak, “Ald. Edward Burke’s Tax Wins Cost City Hall More than $3.6 Million Since 2003,” Chicago Sun-Times, October 7, 2013, NewsBank. 396

redistribute revenues produced at Bulls and Blackhawks games back to regular

Chicagoans. This capture of local lawmaking and regulatory institutions confirms that in

Chicago, the professional sports business was no exception to what James Galbraith

describes as the increasing tendency among corporations at the end of the twentieth

century to aspire to “complete control over the apparatus of the state.”118 It also adds

weight to the suspicions articulated by Judith Grant Long that, by spreading subsidy

mechanisms across multiple local institutions, sports teams have reduced the ability of

the public to keep track of and organize against them.119

The histories of the amusement tax breaks and property tax appeals also

underscore the point that this sort of risk reduction for private investment had as much to do with structural changes in fiscal policy writ large as it did with the specific monopoly powers wielded by pro sports leagues and teams. Investment “incentive” programs debuted by the state during the eighties and nineties such as the aforementioned

Enterprise Zone Program and High Impact Business program included provisions for exempting developers from paying excise and/or sales taxes, and many major corporations availed themselves of the breaks in return for establishing or maintaining a

presence in the state.120 Moreover, as discussed above, most major players in the Chicago

real estate market profited year after year from valuable reductions in their property tax

bills as a result of formal appeals.

The details surrounding the United Center’s property tax appeals call into question the relevance of the teams’ special monopoly powers for other reasons as well.

118 Galbraith, The Predator State, 126, 131.

119 Long, Public/Private Partnerships, 188.

120 McCourt and LeRoy, A Better Deal for Illinois. 397

Specifically, Cook County continued offering valuable assessment reductions on top of

the original property tax breaks even after the type of leverage that came with credible

threats of franchise relocation had evaporated for Reinsdorf and the Bulls. By the time

the United Center opened in 1994, the team had already brought home three NBA titles,

establishing itself not only as one of the most formidable squads in league history but

also as one of the most recognizable and profitable brands in the NBA. Regardless of the

whims of Reinsdorf, NBA leadership would have never allowed for the relocation of the

Bulls outside of Chicago after the early 1990s. The Bulls topped the list of official NBA

team merchandise sales, and had driven record-high ratings for the NBA finals. The

dependence of the league on Jordan and company reached the point where, in 1997, one

sports industry trade publication re-dubbed it the “National Bulls Association.”121

Moreover, given the fact that the United Center was already producing massive profits

independent of the money that the owners might save on appeals, Reinsdorf and Wirtz

were not leaving the West Side. Their teams’ future in Chicago had nothing to do with amusement tax rates or successful property tax appeals. That Cook County officials continued to grant assessment reductions after these developments suggests they were

either ignorant of the situation, or that the United Center was simply benefiting from an

indirect subsidy which was par for the course among well-connected developers in

Chicago, whether or not they had the backing of a pro sports league.

Interestingly, Mayor Daley’s fickle relationship with the Bulls and Blackhawks in the United Center era confirmed that there were very real limitations on Reinsdorf and

121 “National Bulls Association,” Sporting Goods Business, August 20, 1997, Sports Business Research Network. On ratings, see “NBA Finals Set Ratings Record,” Sports Business Update no. 229, Sports Business Research Network; “NBA Finals Ratings Fall to 18-Year Low,” Sports Business Update no. 281, July 5, 1999, Sports Business Research Network. 398

Wirtz’s ability to take drastic action (i.e. threaten relocation, etc.) in response to local government not playing by their rules. Daley often caved to pressure from the owners’ demands on issues such as rate hikes on the amusement tax, but occasionally he followed through assertively with plans that threatened to cut into the profitability of the arena.

Daley and the City Council not only stood firm on several proposed rate hikes for the amusement tax, but also approved a 2004 budget requiring all of Chicago’s major league facilities to reimburse the city for the costs of using police to control traffic on game days. 122 Estimates of the annual costs of using Chicago cops for the job at all of the local

venues ranged from a few million to tens of millions of dollars. Either way, it was more

than pocket change for Reinsdorf and Wirtz, and all they did in response was voice their

“disappointment” to the media.123 In other words, Daley proved that United Center

revenues could be tapped by government without disastrous repercussions for the city.

That this rarely happened signaled not that local policymakers considered themselves

hostages of the specific monopoly powers wielded by the Bulls and the NBA, but rather

that they were willing to give United Center ownership the same preferential treatment

received by most influential real estate investors.

122 Both Mayor Daley and Cook County President Stroger felt enough pressure to increase tax revenues without stoking the ire of homeowners that, on several occasions during the nineties and 2000s, they defied the wishes of United Center ownership by raising the amusement tax rate. Nevertheless, the influence of Reinsdorf and Wirtz placed real limits on local officials’ ability to boost the rates. Citing unnamed sources from City Hall, both the Sun-Times and Tribune reported that lobbying by the two owners played a critical role in Daley’s decision to “back off plans” for a 33 percent increase in the amusement tax and settle for a 17 percent increase. Fran Spielman, “Daley Backs Off on Tax-Theater, Sports Pressure Works,” Chicago Sun-Times, October 23, 1994, NewsBank; Robert Davis, “City Passes Tax Hike That Spreads Pain,” Chicago Tribune, November 11, 1994, ProQuest.

123 “Pay While they Play,” Chicago Tribune, December 3, 2003, ProQuest; Ray Hanania, “Let Teams Pay Police at Games, Union Says,” Chicago Sun-Times, November 3, 1989, NewsBank. 399

Jerry Reinsdorf, Public Relations, and “Philanthropic Overlay”

As Reinsdorf and Wirtz collected millions in tax-exempt profits from the United

Center, other Chicagoans weren’t doing so well. This was especially true for public

school students and teachers who had to endure the constant erosion of resources (and

jobs, in the case of teachers) that came with what seemed like a never-ending budget

crunch. During the nineties and 2000s, the “chronically underfunded” Chicago Public

Schools (CPS) made deep cuts to athletic teams, after-school programs, special education

instruction, and bus service.124 In 1992, for example, things got bad enough that CPS

principals voted to suspend winter sports programs on the heels of $800,000 in cuts to

the budget for sports and extracurricular activities (the crisis subsided when private

donors stepped in to save the day). Sadly, the cuts to sports programs were a drop in the

bucket compared to those suffered by other parts of CPS. A year earlier the Chicago

Board of Education slashed the annual budget for the district’s reading program by $13

million.125

The political economy of property taxation played a central role in CPS’s ongoing

fiscal strain. At the end of the twentieth century some states replaced school-funding systems that relied heavily on local property taxes with new systems depending more on

124 For helpful summaries of CPS’s long history of fiscal problems, see Dorothy Shipps, School Reform, Corporate Style: Chicago, 1880-2000 (Lawrence, KS: University of Kansas, 2006), esp. 91-92 and 154; Jim Carl, “ ‘Good Politics Is Good Government’: The Troubling History of Mayoral Control of the Public Schools in Twentieth-Century Chicago,” American Journal of Education 115 (February 2009): 305-336. On specific issues and events, see David Rudd and Robert David, “School Closings Rejected,” Chicago Tribune, July 27, 1991, ProQuest; Kevin Knapp, “Selling School Spirit,” Crain’s Chicago Business, June 29, 1998, ProQuest; Rosalind Rossi, “Principals Struggle to Find $10 Mil. In Cuts,” Chicago Sun-Times, March 30, 2005, NewsBank; Tracy Dell’Angela, “$77 Million In School Cuts,” Chicago Tribune, February 15, 2006, ProQuest; Maudlyne Ihejirika, “Disabled Kids Left in Lurch After CPS’ Budget Cuts,” Chicago Sun-Times, October 4, 2006, NewsBank; Wendell Hutson, “State Budget Woes Hurt School Bus Service,” Chicago Defender, ProQuest.

125 William Rhoden, “For Chicago High School Sports, A Crash Course in Survival,” New York Times, October 10, 1992. 400

paying for elementary and secondary education through the redistribution of state corporate income tax revenues. The latter provided for the transfer of more funds to cash- strapped, poverty-stricken districts unable to generate enough property tax revenue to keep up with their richer counterparts. Despite pressure from education advocates and municipal officials from high-poverty districts, state legislators in Illinois consistently rejected reform, and by the new century districts like CPS still depended on local property taxes for nearly 40 percent of their annual revenue (the largest source of revenue, by a significant margin). This overreliance on local property taxes made Illinois’ school funding system one of the most inequitable in the nation. According to a statistical model developed by the Education Law Center in 2010, Illinois students in high-poverty districts like CPS received significantly less per-pupil funding than low- or no-poverty ones (only Nevada and New Hampshire had larger disparities).126

CPS’s dependence on property tax revenues made it impossible to collect the

funding necessary to raise per-pupil expenditures to the level enjoyed in affluent suburbs.

As developers like Reinsdorf and Wirtz adeptly worked the system to lower their tax bill,

county officials had to raise property tax rates or make cuts to public services in order to

make up the difference.127 Local officials faced serious limits on how much more they

could ask of regular homeowners since, as the Tribune rightly pointed out in the mid-80s,

“no elected official [in Chicago] is going to propose [a] major residential tax increase”

126 On the overreliance on property taxes by Chicago, Cook County, and Illinois, see Institute on Taxation and Economic Policy, “Balancing Act”. On revenue statistics for CPS, see Chicago Public Schools, Understanding the Chicago Public Schools Budget: A Citizen’s Guide (Chicago, IL: Chicago Public Schools, n.d.), http://www.cps.edu/SiteCollectionDocuments/CitizensGuide.pdf. On disparities between high- and low-poverty districts in Illinois, see Bruce Baker, David Sciarra, and Danielle Farrie, Is School Funding Fair? A National Report Card (Philadelphia, PA: Education Law Center, September 2010), accessed July 10, 2010 http://www.schoolfundingfairness.org/National_Report_Card.pdf.

127 For a concise explanation of how tax cuts for the wealthy create heavier burdens for middle- and low- income Americans, see Johnston, Perfectly Legal, 13. 401

for fear of alienating voters.128 In fact, in the mid-nineties voters in Cook County

endorsed strict limits on the ability of taxing bodies like CPS to raise their property tax

levies (i.e. official requests for property tax funding). In 1995, CPS became subject to the

Property Tax Extension Limitation Law (PTELL), which capped levy increases at 5 percent or the Consumer Price Index, whichever was lower.129 The combination of

deindustrialization, massive abatements for corporations, and voter resistance created a

cycle of underfunding which severely limited the amount of money that CPS could

demand from taxpayers.130

Despite Reinsdorf’s role in perpetuating this larger cycle, after the United Center opened Chicago’s media and political establishment touted him as one of the city’s premier education philanthropists. Before 1990, Reinsdorf had made token gestures to

CPS by participating in the “Adopt-a-School” program, which involved arranging some free tickets and appearances by Bulls players for local schools.131 He upped the ante in

1998 when, through the “Charitabulls” (the name of the Bulls’ charity arm), he gave CPS

$3.5 million to help provide after-school tutoring for students struggling in math and

English, some new computers, as well as new teaching materials.132 Either ignorant of or

128 “Cook County’s Tax Squeeze,” Chicago Tribune, November 10, 1985, ProQuest.

129 Lou Ortiz, “Voters’ Tax Message: Put a Cap On It,” Chicago Sun-Times, November 10, 1994, NewsBank; Civic Federation, “TIF Does Not Take Money Away From the Chicago Public Schools,” The Civic Federation, November 9, 2009, accessed July 10, 2013, http://civicfed.org/civic-federation/blog/tif- does-not-take-money-away-chicago-public-schools.

130 On the negative—or, at best, neutral—impact of “business incentives” on local tax bases, see Lingwen Zheng and Mildred Warner, “Business Incentive Use Among U.S. Local Governments: A Story of Accountability and Policy Learning,” Economic Development Quarterly 24, no. 4 (2010): 325-336.

131 Linda Kay and Mike Conklin, “Odds & INS,” Chicago Tribune, April 26, 1988, ProQuest; “Diversity Spice of Life at Washington,” Chicago Sun-Times, May 5, 1993, NewsBank.

132 Fran Spielman, “Bulls Give Students a $3.5 Million Boost,” Chicago Sun-Times, November 11, 1998, NewsBank. 402

indifferent to the fact that Reinsdorf had cost the city many millions more in property tax receipts, the papers and CPS officials gushed over his alleged generosity. The Tribune

insisted that Reinsdorf deserved “extra credit for a big assist,” and school board president

Gery Chico mused that the donation proved how, despite the cessation of professional basketball games due to the NBA lockout of 1998, Reinsdorf’s basketball team “was playing on a far more important court—the communities and the city. That is where the

Bulls touch a lot of people.”133

And it wasn’t just the predictably sycophantic columnists at the Tribune who

positioned Reinsdorf as a savior for CPS. The Chicago Defender published several puff

pieces regurgitating the mayor’s characterization of the charity as “a perfect example of

how the public and private sectors can work together to help students reach their

potential,” as well as Chico’s assertion that “this demonstrates that the private sector can

make a meaningful impact in our students’ lives by working hand-in-hand with our

educators to design excellent school programs.”134 The Sun-Times also patted Reinsdorf

on the back. In 1999 the paper made it a point to describe as “widely unnoticed” the fact

that Reinsdorf was funneling a lot of money into Chicago Public Schools, and in 2000

insisted that “anybody who takes enough money to buy the services of a moderately good

133 Steve Rosenbloom, “Good Morning, Ed Lynch,” Chicago Tribune, November 11, 1998, ProQuest; Fred Mitchell, “Bulls’ Donation Gets High Grades From City Schools,” Chicago Tribune, November 11, 1998, ProQuest.

134 Chinta Strausberg, “Bulls Donation to CPS Hailed,” Chicago Defender, November 11, 1998, 5; Joe Ruklick, “Bulls Team Up With Middle Schools to Press for Scholarship,” Chicago Defender, September 7, 2000, ProQuest.

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middle infielder and gives to kids trying to learn deserves to read something nice about himself.”135

The mainstream media’s effusiveness over Reinsdorf’s goodwill had much to do with the highly choreographed publicity campaign executed by the Bulls and the city.

While Reinsdorf’s people did their best to conceal news of his tax advantages, they made sure to notify the press about parties held for Bulls Scholar participants at the United

Center, and about the 2000 CPS awards banquet where the district named Reinsdorf

“Corporate Partner of the Year.”136 Despite insisting that “people generally don’t know what we’re doing [with the Bulls charities] because I don’t do it for recognition,”

Reinsdorf was a calculated self-promoter. After the Bulls Scholars contribution, he penned a sappy editorial for several local papers in which he recalled “learn[ing] to appreciate the value of an education from my father” and mused that his “parents would be proud to know that I am now involved with something like the Bulls Scholars

Program.”137 Reinsdorf also made it a point to highlight the work of the Charitabulls whenever he spoke at universities or civic organizations.138

135 Raymond Coffey, “Schools Score Big With Largess,” Chicago Sun-Times, May 7, 1999, NewsBank; Ron Rapoport, “Cheers: Reinsdorf Lauded, Applauded,” Chicago Sun-Times, November 14, 2000, NewsBank. Despite fawning over Reinsdorf, Rapoport raised one concern over the Bulls Scholars program: “According to the school board’s statistics, 48 percent of Bulls Scholars are doing better in English than their peers. Does that mean 52 percent are doing worse?”

136 Terrence Armour, “10 Years Later, Back to Lottery,” Chicago Tribune, May 19, 1999, ProQuest; Fred Mitchell, “Brawls Nothing New to Wrigley Field,” Chicago Tribune, May 18, 2000, ProQuest. For more on the public honors received by Reinsdorf, see Melissa Isaacson, “Game-changer,” ESPN.com, January 12, 2012, accessed July 10, 2010, http://espn.go.com/chicago/mlb/story/_/page/chicagomlk/jerry-reinsdorf- work-promoting-diversity-makes-impact-chicago.

137 Letter from Jerry Reinsdorf to the Daily Herald, December 24, 1998, ProQuest.

138 See, for example, Jerry Reinsdorf, “The Economics of Sports and of the Real World,” lecture at Elmhurst College, Elmhurst, Il, September 20, 2012, http://public.elmhurst.edu/news/archive/171005291.html; Jerry Reinsdorf, speech at the Economic Club of Chicago, Chicago, IL, February 14, 2006, http://www.econclubchi.org/Documents/Meeting/332a4275- 930e-4113-9a70-9d3e3c072d9b.pdf . 404

According to Chicago historian Christopher Lamberti, Reinsdorf learned crucial

lessons about the importance of image management during his negotiations with the city

and state over a new stadium for the White Sox in the late eighties.139 At that point, the

media regularly pilloried the Bulls and Sox owner as a “con man” and a “carpetbagger”

(for his threats to move the Sox to Florida).140 But now the lead story on Reinsdorf was

his determination to “do good” rather than his aggressive pursuit of “corporate welfare.”

Even newspapers outside of Chicago commented on the makeover. In 1998, the New

York Daily News acknowledged that “Reinsdorf is seen as villainous for what happened

on the South Side [with the Sox],” but insisted that his work with groups like CPS and the

Near West Side Community Development Corporation “approaches the heroic.”141 In

November 1991, Bulls’ Vice President of Marketing Steve Schanwald wrote in a guest column appearing in Team Marketing Report that the “mission” of his department was to

“foster a ‘good neighbor’ image” for the Bulls organization.142 Judging by the media’s

change in tune, Schanwald had given Reinsdorf his money’s worth.

It’s tempting to read Reinsdorf’s newfound sense of corporate responsibility as

evidence of his “complexity” or reason to acknowledge the “nuances” of the Bulls’ relationship to the city. However, as the economist and media analyst Edward S. Herman points out, there is nothing inconsistent about the cultivation of a socially conscious

139 Chris Lamberti, “A Tale of Three Jerrys,” Chicago Sport and Society, March 30, 2013, accessed July 10, 2013, http://www.chicagosportandsociety.com/2013/03/30/a-tale-of-three-jerrys/.

140 Tom Fitzpatrick, “Sox Out to Cash In,” Chicago Sun-Times, July 9, 1986, NewsBank; John Kass and Dan Egler, “Sox Owners Tell Their Side of the Story,” Chicago Tribune, June 23, 1988, ProQuest.

141 Luke Cyphers, “Room With a View,” New York Daily News, August 23, 1998, accessed July 10, 2013, http://www.nydailynews.com/archives/sports/room-view-article-1.818657.

142 Steve Schanwald, “Beyond Michael: The Bulls Use Today’s Marketing Strategies to Generate Long- Term Interest in Team,” Team Marketing Report, November 1991, 8, Amateur Athletic Foundation Library. 405

image by businesses in the midst of aggressive campaigns for subsidies of questionable social value. He writes:

When beneficent corporate actions can be justified as consistent with the long-run profit interest of the corporation, the management of the company is not faced with a hard choice or conflict of interest. For example, charitable, education, and public service contributions of corporate resources are regularly justified because they enhance the corporate image and result in better sales, easier recruitment, and so forth.143

In other words, the sort of philanthropy engaged in by Reinsdorf is best understood not

just as a series of decisions to sacrifice revenue for the good of the city, but rather an

integral component of the Bulls’ overall growth strategy.

That Reinsdorf and his subordinates depended on their contributions to CPS, the

Near West Side Community Development Corporation, and other local organizations to provide “philanthropic overlay”—the label used by journalist David Moberg to describe corporations’ use of philanthropy to mask their rapaciousness—is not speculative. They

made this very clear in how they handled the handful of reporters with the temerity to question their business practices.144 When Chuck Neubauer, the only journalist to seriously investigate the United Center tax breaks, called on the Bulls for comment,

Reinsdorf’s associate Howard Pizer tried to divert the inquiry by pointing to “the 4 million the Bulls have donated to build the James Jordan Boys and Girls Club and the $1 million the [United] Center has earmarked to help area businesses.”145 The arithmetic

behind this logic was interesting, to say the least, as Pizer implied that the teams deserved

143 Edward Herman, Corporate Power: A Twentieth Century Fund Study (New York, NY: Cambridge University Press, 1982), 255-256.

144 David Moberg, “3 Troubling Things to Know About Billionaire Penny Pritzker,” In These Times, May 3, 2013, accessed July 10, 2013, http://inthesetimes.com/article/14948/3_troubling_things_about_billionaire_penny_pritzker.

145 Neubauer, “Stadium Snares Huge Tax Breaks.” 406

tens—if not hundreds—of millions in tax breaks in return for giving a few million back

to the local community.146

There was also a certain irony in the way Reinsdorf articulated his own rationale

behind the contributions to CPS. “Welfare is not an answer to anything,” he told the Sun-

Times columnist when asked about the Bulls Scholars program in 1998. “The only way

that people can grow up and succeed is to have good jobs, and in order to get a good job,

you have to have a good education.”147 The next year, he reiterated, “one of our biggest

problems is inner-city ghettos…The solution is not welfare. It’s getting a job. And it’s

very hard to get a job if you can’t read or write. I’ve believed for a long time we have to

improve education.”148 If Reindorf truly believed that “welfare” was holding back the

“inner-city ghetto”—and we have no evidence to suggest that he was being anything but

honest—he clearly did not consider the litany of handouts he received from local

government as part of the same category.

Either way, proactively shaping the conversation about the role of the Bulls and the United Center in the “community” constituted an important part of Reinsdorf’s efforts

to make the “corporate welfare” from which he profited less visible and/or more palatable

146 It’s important to note that these contributions offered more than just public relations benefits. They also made Reinsdorf eligible for significant income tax breaks as a result of charitable deductions from taxable income. As the journalist and social critic Bruce Dixon explains, “that kind of giving, the kind that often combines public charity, public relations and big tax advantages in roughly equal parts is pretty much an accounting and PR requirement for celebrity actors and athletes. It works like this—they’re going to pay taxes anyhow, at much higher rates than with so-called ‘investment income’. Divert that tax money into deductible charities, and its cash they would have paid out anyhow, but now it’s combined with photo opportunities and human interest stories showcasing their personal struggles and bolstering their brand, making them more money.” Bruce Dixon, “Jay-Z’s ‘We Need less Government’ Quip Proves Harry Belafonte Right: He’s a Selfish Loon,” Black Agenda Report, October 3, 2012, accessed July 10, 2013, http://blackagendareport.com/content/jay-zs-%E2%80%9Cwe-need-less-government%E2%80%9D-quip- proves-harry-belafonte-right-hes-selfish-loon.

147 Spielman, “Bulls Give Students a $3.5 Million Boost.”

148 Coffey, “Schools Score Big With Largess.” 407

to the public. Did some Chicagoans who were down on their luck benefit from his

purported largesse? Surely. But there was a radical asymmetry between the value of his philanthropic efforts and that of the various tax expenditures that accrued to the Bulls and the United Center. A shrewd public relations campaign became essential to telling the first half of the story while burying the second.

***

In the fall of 2012, the Chicago papers began to buzz with news of two new development ventures in the immediate vicinity of the United Center. The first involved

Reinsdorf’s decision to move the Bulls’ practice facility from the Chicago suburb of

Deerfield to one of the underutilized parking lots adjacent to the West Side arena. After issuing a joint press release with Mayor Emanuel’s office in November announcing the move, Reinsdorf assured the media that no special agenda lay behind the new project.

“The mayor asked me if we would bring the Bulls back downtown and I’m so impressed with the job he’s doing, I thought it was the natural and right thing to do,” Reinsdorf explained. He added, “I didn’t ask him for any tax breaks…This [practice facility] thing is going to happen regardless of what happens with the United Center.149

Reinsdorf felt compelled to dispel the notion of a quid pro quo for tax breaks

because, around the same time, reports started circulating that United Center ownership

was also planning to develop a new $95 million entertainment complex next to the new

practice center, and that their decision to go through with the plans for the entertainment

complex was “contingent on nailing down an updated version of the [special] property

149 Mayor of Chicago’s Press Office, “Chicago Bulls to Build New Practice Facility Next to United Center,” press release, November 16, 2012; Melissa Isaacson, “Jerry Reinsdorf Explains Bulls’ Move,” ESPNChicago.com, June 14, 2012, accessed July 10, 2013, http://espn.go.com/chicago/nba/story/_/id/8053954/chicago-bulls-chairman-jerry-reinsdorf-said- teamsmove-back-city-was-respect-mayor-rahm-emanuel. 408

tax formula at the United Center” before it expired in 2016.150 Local business reporter

Greg Hinz didn’t buy Reinsdorf’s insistence that renewal of the tax breaks were linked

only to the proposed entertainment complex (i.e. not to the new practice facility). A few

weeks after construction crews broke ground on the practice facility in June 2013, Hinz

commented that the relocation had “sweetened the pot” of development projects dangled

in front of the noses of local politicians on whom Reinsdorf would depend to pressure the

state legislature to keep the property tax breaks alive.151 Hinz had good reason not to trust

Reinsdorf. A few weeks before he wrote his article, Reinsdorf told Franz Spielman at the

Sun-Times that the special property tax formula “didn’t save us millions of dollars…all

we got [through the original formula] was predictability and tax certainty…for all I know,

we ended up paying more taxes than we would otherwise have paid.”152

Whether or not the entertainment complex plans come to fruition and Reinsdorf

locks in a fresh property tax deal remains to be seen. Based on the history recounted in

this chapter, Chicagoans would do well to expect the worst. Even at a time of increasing

cuts to public services—especially the public school system—the new mayor has shown

a willingness to squander taxpayer money on downtown development projects of dubious

150 Greg Hinz, “Bulls Confirm new Practice Facility Next Door to United center,” Crain’s Chicago Business, November 16, 2012, ProQuest; Fran Spielman, “Bulls: New Practice Facility a Go, But Entertainment Complex Needs a Tax Break,” Chicago Sun-Times, November 18, 2012, NewsBank. As a result of confusing language in the original legislation, there is a lack of consensus about whether or not the original breaks expire in 2016 or 2017. See, for example, Maureen O’Donnell, “Bulls, Blackhawks Owners Seeking Huge Expansion of United Center,” Chicago Sun-Times, May 30, 2012, NewsBank.

151 Greg Hinz, “With Cup in Chicago, Will Emanuel OK Wirtz’s UC Expansion Plan?,” Crain’s Chicago Business, June 26, 2013, ProQuest.

152 Fran Spielman, “Bulls, Rahm Break Ground on New $25 Million Practice Facility on United Center Parking Lot,” Chicago Sun-Times, June 10, 2013, NewsBank. 409

civic value, including a new, publicly-funded arena for (private) DePaul University’s

basketball team.153

On its most basic level, the fiscal history of the United Center places in stark

relief the fact that despite pricing out the vast majority of Chicagoans from the new arena,

the team owners demanded that those same Chicagoans subsidize the facility through

arrangements largely hidden from public view and excluded from democratic decision-

making. As the media showered them with praise for “privately” financing the United

Center, arena ownership constructed an array of tax abatement strategies which

guaranteed that every echelon of local government worked to shield their real estate

investment from risk. This comprehensive cooptation of public lawmaking institutions

and elected officials thus offers another telling case study in how the professional sports

business very deliberately expanded its power to shape markets on its own terms.

The success of United Center ownership in this regard conformed to important

shifts in the history of major league stadium finance during the late 1980s and 1990s, as

owners began to front large sums to cover construction costs, just as Reinsdorf and Wirtz

did, in order to monopolize rights to venue-related revenues. At the same time, however,

they lobbied in lawyers’ offices, state houses, and City Council meetings to ensure that

the public reimbursed them through tax breaks and other hard-to-track subsidies. In

reality, the funding of these facilities remained very public, even as team owners

accomplished the wholesale privatization of stadium revenue streams.

153 Ben Joravsky, “How Chicago’s Five-Year School Plan Was Dead on Arrival,” Chicago Reader, June 25, 2013, accessed July 10, 2013, http://www.chicagoreader.com/chicago/mayor-emanuel-kills-school- plans-with-cuts/Content?oid=10131475; Ben Joravsky, “Millions for DePaul, Budget Cuts for Public Schools,” Chicago Reader, June 13, 2013, accessed July 10, 2013, http://www.chicagoreader.com/Bleader/archives/2013/06/13 /millions-for-depaul-budget-cuts-for-public- schools.

410

These changes, however, were not unique to the pro sports business; they mirrored a much larger move by corporations and land developers to ensure that local and national fiscal policy prioritized the profitability of private real estate investment. It’s true that teams like the Bulls exploited the special monopoly privilege enjoyed by professional leagues and teams whenever they could. But the fact remains that most major real estate investors in Chicago employed the accumulation and risk-reduction strategies outlined in this chapter with a high a degree of impunity. The Bulls’ relationship to the government represented a symptom of a systemic problem, not an exception within an otherwise free market.

411

Conclusion

A few weeks before the Bulls won their fifth NBA title in 1997, Chicago traffic cop Stan Mullins marveled at the symbolic power of Michael Jordan. “It’s amazing how one man could change the face of this city,” Mullins told the Tribune.1 He wasn’t wrong.

Though the mystique of Jordan never fully eradicated the iconography of Al Capone— today travelers can still purchase Capone-themed shot glasses at Midway Airport or pay

$30 to take an “Untouchables Tour” of the city—in the eyes of many outsiders it radically remade the Chicago brand. But this new “face” was a mixed blessing for

Chicagoans. This was not simply because the Bulls did little to solve entrenched social and economic injustice in the city—in this regard, nobody seriously expected otherwise.

It was also because the team supported a local political economy of place in which expanded profits for the real estate industry increasingly trumped development attentive to the everyday needs of residents unable to pay market rates for surviving and thriving in the post-industrial city.

Admittedly, the value of the Bulls in Chicago went beyond the balance sheets of developers and the bank accounts of well-connected alderman. The team’s success offered local residents from every corner of the city with the psychological benefits— pride, distraction, etc.—that come with living in a championship city, and on occasion provided the impetus for collective celebration that transformed places like Grant Park into a momentary oasis of integration. Viewed in isolation, these benefits appear to vindicate those who argue that teams like the Bulls make their respective cities better places to live for everyone, irrespective of the costs of bringing them to or keeping them

1 John Husar, “Jordan’s Statuesque Presence Draws Thousands to Pregame Pilgrimage,” Chicago Tribune, May 29, 1997, ProQuest. 412

in town (or, more generally, keeping their owners happy). However, as with most assets

in a “New Chicago” where policymakers fixated on urban marketing and the expansion

of leisure infrastructure, the Bulls offered very different returns to residents depending on

where they lived and what they owned. Moreover, this unevenness in the distribution of

benefits intensified over time.

The fans at Bulls games were never a perfect socioeconomic cross section of

Chicago, but by the late 1980s Chicago Stadium was emerging as a premier destination

for the new urban gentry prized by local politicians and developers, and steep rises in

demand and prices for tickets dramatically exacerbated the economic and spatial

segregation of Bulls fans. Those with the money or connections to score tickets reveled in

the exhilaration of live spectatorship, while the rest of Chicago cheered in front of their

television sets. The construction of the United Center galvanized this tiered system of

spectatorship by embracing a design that maximized premium seating and luxury

concessions, and at the turn of the twentieth century the Bulls’ new state-of-the-art home court was effectively off limits to most of the city.

Many observers suggested that this segregated spectatorship was a small price to pay for the bundle of concessions made by Jerry Reinsdorf and Bill Wirtz to Near West

Side residents in exchange for their blessing to construct the United Center. In theory, the deal would enhance both the profitability of the Bulls and use-values (e.g. available housing, a new library, jobs, etc.) for the entire neighborhood, but in reality the new arena anchored a model of redevelopment that ultimately viewed poor neighbors as a liability.

In fact, local public housing residents had to wage a protracted struggle against the city and members of the United Center coalition in order to guarantee their rights to remain in

413

the neighborhood and access the fruits of redevelopment. Unfortunately for them, the

United Center’s effectiveness as a node of economic revitalization has proven

questionable at best, in large part due to a design intended to discourage the emergence of

nearby firms that might compete with the arena for revenues.

Reinsdorf and Wirtz’s obsession with eliminating competition and minimizing the

risk of investment in the United Center proved costly for Chicagoans not just in terms of

their pocketbooks but also in terms of their access to basic resources like quality

neighborhood schooling. From wiping out the livelihoods of local peanut vendors to

securing massive property tax breaks that placed further strain on an already regressive

public school finance system, Bulls ownership designed an intricate system of risk-

reduction measures made possible by the cooperation of political allies at all levels of

government. The willingness of judges, state legislators, and municipal officials to

sanction and execute these measures might appear at first glance like an extension of the

preferential treatment long bequeathed to the professional sports business by American lawmaking institutions. However, it was symptomatic of a much larger transformation in the structures of urban growth in which state institutions at the national and local levels abdicated their responsibility for guaranteeing basic economic and social needs such as housing, and increasingly embraced a role defined first and foremost by the task of eliminating barriers to value extraction by major commercial property-holders.

It’s absolutely true that by the end of the twentieth century leagues like the NBA constituted thoroughly globalized entertainment industries, and that traditional spectatorship constituted only one of their many profit centers. However, recognition of the importance of trends towards global mass-mediation and product diversification

414

should complement, rather than supplant, an ongoing engagement with place-specific histories of the professional sports business. As the preceding chapters show, many of the industry’s profit centers and growth strategies have remained squarely grounded in local place, and cities hoping to prove their uniqueness to the outside world have looked increasingly to the local production of spectator sports as a form of post-industrial image capital and leisure infrastructure. Ultimately, the place-specific and globalized manifestations of teams like the Bulls have been mutually reinforcing phenomena. For example, the radical expansion of demand for premium seating has no doubt been driven by the success of the NBA’s national and international marketing campaigns, while those campaigns themselves derive much of their power from cultivation certain inter-urban rivalries and the dissemination of “hometown” storylines.

Of course, there is more to all this than developing a better academic understanding of the sports business. As many of the stories recounted above make clear, the transformation of the industry at the end of the twentieth century has had real and, in many cases, devastating impacts on residents in cities like Chicago. The question then becomes: Equipped with an understanding of how professional leagues and teams threaten the well-being of neighborhoods and cities, what can ordinary people do to mitigate their impact? There are no clear answers, especially given the fact that the increasing market power of teams like the Bulls is not a problem unique to the urban sport business, but rather one manifestation of a prevailing growth model in which the state prioritizes the profitability of established commercial real estate interests above all else. In other words, there is no reason to believe that effectively contesting teams and leagues will safeguard cities and neighborhoods from regressive development. Moreover,

415

the prospects for conventional “democratic” resistance (i.e. through voter referenda) to state intervention on behalf of teams are bleak, since, as the fiscal history of the United

Center makes clear, much of this intervention occurs outside the boundaries of public decision making (the aforementioned unilateral decision by Chicago Mayor Rahm

Emanuel to use tax increment financing dollars to finance a new basketball stadium for

DePaul University offers a perfect case in point).2

Encouragingly, pushback by ordinary residents against attempts to transform

cities into new sites of value extraction for the sports business through means other than

the ballot box are becoming increasingly visible (though mostly outside the U.S.). In

2013, Brazil has been racked by protests stoked in part by inordinate public spending on

the upcoming World Cup, and these come on the heels of relatively widespread

organization by an “uncommon blend of activists [including] indigenous dissidents, anti-

poverty campaigners [and] environmentalists” against the public subsidization of and

heightened policing around the 2010 Winter Olympics in Vancouver.3 These nascent

movements have overcome an important barrier by recognizing that, though one might

imagine a world in which spectator sport circulates primarily as “\a “public good,” this is

not the world in which we currently live. Their ultimate success, however, likely depends

on their ability to spark—or join forces with—a broader movement dedicated to limiting

the ability of capital to pursue urban development projects that sacrifice residents’ well-

being in the name of economic returns.

2 Ben Joravsky, “Mayor Rahm’s TIF Games,” Chicago Reader, September 19, 2013, http://www.chicagoreader.com/Bleader/archives/2013/09/19/mayor-rahms-tif-games-marriott-and-depaul- vs-the-kids-of-chicago.

3 Jonathan Watts, “Brazil’s Protests Raise Fears for World Cup as a Million Take to the Streets,” The Guardian, June 31, 2013, http://www.theguardian.com/world/2013/jun/21/brazil-protests-football-world- cup. Jules Boykoff, “The Anti-Olympics,” New Left Review 67 (January-February 2011), http://newleftreview.org/II/67/jules-boykoff-the-anti-olympics. 416

Appendix A

Logistic Regression Analysis of 1993 General Social Survey Data

Introduction

Applying a technique known as Multiple Classification Analysis (MCA) to data from the 1993 General Social Survey (GSS), sociologist Thomas Wilson has shown that

“those who are richest in cultural capital [measured as education] and those richest in economic capital [measured as income]” are the most likely to attend live sporting events.1 His results also indicate that income has a stronger relationship with women’s decision to attend sporting events relative to education, while the reverse is true for men.

MCA yields the same “overall results” (i.e. same F-test statistic or “goodness of fit” measure) as a multiple regression analysis with dummy variables, but the results are reported differently. Instead of individual regression coefficients, statistical software reports the unadjusted and adjusted sub-group means for each categorical predictor, with the latter controlling for any covariates included in the model. Additionally, it provides an “eta score” showing the relative strengths of predictors by themselves (i.e. without covariates) and a “beta score” showing the relative strengths of the predictors when controlling for covariates. While MCA is useful for determining whether or not non- continuous predictors are correlated with a categorical outcome, unlike logistic regression with continuous predictors it does not produce coefficients (i.e. betas) that estimate the change in the odds of the categorical outcome associated with a one-unit change in a given independent variable.

1 Thomas Wilson, “The Paradox of Social Class and Sports Involvement,” International Review for the Sociology of Sport 37, no. 1 (March 2002): 5. 417

I replicated Wilson’s analysis using binary logistic regression to: 1) verify the

robustness of his results across modeling techniques, and 2) estimate the change in the

odds of having attended a sporting event associated with a one-unit change in education

and family income, all else being equal. By treating income and educational attainment as continuous variables, the logistic regression model specified below not only provides individual regression coefficients, but also allows for the generation of predicted probability curves like those in Figures 2.6 and 2.7.2

Data and Methods

For the US, the 1993 GSS was one of the only national surveys not conducted by

private market research firms that asked respondents about their sport spectatorship

habits during the 1980s or 1990s.3 The survey employed a nationally representative sample of English-speaking households obtained through multi-stage stratified sampling.

Full probability (i.e. random) samples of households were taken within regional strata, and respondents within households were also randomly selected. The sample excludes populations not living in households (e.g. college dorm residents, military personnel, homeless and incarcerated populations). While the formulation of the GSS survey questions is less than ideal for the purposes of this analysis, the large sample size lends itself to a high degree of statistical power. I do not impose any external restrictions on the

2 For more on MCA, see Melissa Hardia and Chardie Baird, “Multiple Classification Analysis (MCA),” in The Sage Encyclopedia of Social Science Research Methods, ed. Michael Lewis-Beck, Alan Bryman, Tim Futing Liao, 685-686 (Thousand Oaks, CA: Sage, 2004); Philip White and Brian Wilson, “Distinctions in the Stands: An Investigation of Bourdieu’s ‘Habitus’, Socioeocnomic Status and Sport Spectatorship in Canada,” International Review for the Sociology of Sport 34, no. 3 (1991): 252; Robert Retherford and Minja Kim Choe, Statistical Models for Causal Analysis (Hoboken, NJ: Wiley Interscience, 1993), esp. Chapter 3.

3 The Consumer Expenditure Survey, referenced in the main text, is the only other known to the author. 418

sample other than the exclusion of cases with missing values on the predictor or outcome

variables. The final analysis sample consists of 1396 of 1606 total cases.4

My dependent variable is a binary outcome which indicates whether or not the

respondent attended an amateur or professional sporting event in the year leading up to

the survey (i.e. 1992). The relevant survey question reads as follows:

Next I'd like to ask about some leisure or recreational activities that people do during their free time. As I read each activity, can you tell me if it is something you have done in the past twelve months? Let's begin with attending an amateur or professional sports event. Did you do that within the past twelve months?5

Since the response is either “yes” or “no” and I use a binary logit model, there was no major data processing required. The frequency distribution of this binary outcome indicates adequate variation for statistical analysis. 626 respondents (44.84 %) from my final sample said that they did not attend a sporting event in the last year, while 770

(55.16 %) said that they had attended a sporting event during that time (see Table

A.1.1).6

4 Of the 210 excluded cases, 130 were excluded because they are missing data on family income of the respondent, 80 were excluded because they are missing data on whether or not the respondent lives in a rural or urban area.

5 National Opinion Research Center, Ballot A Questionnaire, 1993 General Social Survey (Chicago, IL: University of Chicago, 1993), 59.

6 The figures in Table A.1.1 differ slightly than those in the text as a result of accounting for sample weights. 419

Table A.A.1. Weighted Descriptive Statistics for General Social Survey Sample (n = 1,396). Mean or Standard Percent Deviation Minimum Maximum

Dependent Variables Attended sporting event in previous year Yes 57.87 0 1 No† 42.13 0 1

Independent Variables Individual-level Education (years) 13.22 2.93 0 20 Age 43.85 16.59 18 89 Race White† 84.28 0 1 Black 10.63 0 1 Other 5.09 0 1 Sex Male 46.00 0 1 Female† 54.00 0 1 Has a child Yes 71.92 0 1 No† 28.08 0 1 Household-level Family income (1992 dollars) 41,088.25 30,156.22 500 103,591.60 Community type Urban 44.78 0 1 Rural† 55.22 0 1

Source: National Opinion Research Center, General Social Survey, 1993 (Chicago, IL: University of Chicago, 1993). Notes: Sample limited to respondents who answered survey question about their attendance at sporting events in past twelve months. † indicates reference category. Weighted to account for oversample of members of smaller households. See text for details on transformation and top-coding of income.

The predictors include family income, education, age, sex, race, community type, and whether or not the respondent has any children. Family income functions as my primary proxy for socioeconomic status (SES). Wilson’s analysis does not specify whether or not he used family or respondent income, but I opt for the former since one would expect that having parents or other immediate family members with higher incomes could have some effect on young-adult or non-worker respondents’ ability to

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attend sporting events. The GSS records income within discrete (i.e. categorical) bands rather than as a continuous variable. However, following Michael Hout’s work on using

GSS income measures, I opt to recode the bands as a continuous variable using the midpoint of each one. I also use an equation offered by Hout (derived from the Pareto curve) to compute a top-code based on the frequencies of respondents in the top two income bands (for this dataset, the computed top-code is $103,591.60).7 While a natural log transformation of the continuous income variable does yield a slightly better model fit based on the Bayesian Information Criterion (BIC), the difference appears to be marginal and there is no substantive change in the direction, effect size, or significance of any of the other coefficients.8 In order to facilitate easier interpretation, I report results from the model without a log-transformed family income variable.

Years of education is included as a covariate and alternative proxy for SES to account for the possibility that any relationship between income and the probability of attending a sporting event is spurious, and conceals a process by which more years of education exposes respondents to increased opportunity and motivation to attend sporting events. More specifically, increased tenure in educational institutions may increase the

7 Michael Hout, “Getting the Most Out of the GSS Income Measures,” GSS Methodological Report 101 (July 2004). In the 1993 GSS, the highest category is “$75,000 and above,” and the open-ended nature of this category precludes easy determination of the midpoint. Hout offers two approaches to determining this midpoint, or “top-code.” The first involves arbitrarily setting the top-code at some fixed amount above $75,000. The second involves the formula alluded to in the text, or equation no. 2 in the aforementioned paper by Hout. However, the formula for equation no. 2 is printed incorrectly in the original publication; the entire equation must be divided by two in order to yield the correct results.

8 BIC was used in lieu of log-likelihood tests since the estimation command incorporated sample/probability weights. BIC for the model without the transformation was 1699.758, and 1695.335 with the transformation. Following the work of Adrian Raftery, a difference of BICs of this magnitude is “positive” but not “strong” evidence of improved fit. See Adrian Raftery, “Bayes Factors and BIC,” Sociological Methods and Research 27, no. 3 (February 1999): 411-427. The only difference in terms of coefficients for the controls was that after the transformation, the p-value of the gender dummy variable went from 0.001 to 0.003. BICs for both of these models were well below a model including the original income bands as dummy variables (BIC = 1797.65). 421

propensity to attend events as a result of intensified identification with high-school and college teams/athletes. This mechanism would likely extend beyond amateur events, since athletes in major college programs often continue their careers in professional leagues. Wilson transformed the GSS’s continuous years of education variable into a categorical variable, but sensitivity tests show that the former yields a better overall fit, all else being equal.

The final model also includes a continuous measure of respondent’s age under the assumption that attendance is likely to decline with age. It also seemed plausible that sporting event attendance might increase with age up to a certain point, and then begin to decline with increasing age. However, sensitivity tests conducted during the model selection phase indicated that a quadratic transformation of age was not statistically significant and did not improve the fit of the model.

I also control for sex, coded as a dummy variable with female as the reference category. In theory, this serves as a test for the enduring popular assumption in the US that men are more likely to spend their leisure time at sporting events, especially given the lack of parity between the frequency of male and female sporting events. The final model also includes controls for race, coded as dummy variables for white, black, and other race.

Wilson includes geographic region as a control, but I omit it in my model. If the relevant survey question dealt exclusively with professional sports, including regional fixed effects would make sense, in that professional—especially “major league” (i.e. the most costly)—sporting venues are concentrated heavily in the Northeast, Midwest, and

West Coast. However, amateur events, which take place at high-school, college, and

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“small-time” venues, are likely distributed more evenly throughout all regions. With this in mind, and without more specific data on the relative geographic distributions of these types of events and venues, developing a theory for regional controls is premature. As an alternative, I include a binary control for “community type,” with 1 indicating that the respondent resides in an urban area and 0 indicating the respondent resides in a rural area.

This offers a more parsimonious approach to controlling for the possibility that higher population densities correlate with a higher frequency of staging public sporting events.

Finally, I use a dummy variable to control for whether or not each respondent has children in order to account for the possibility that parents are more likely to attend amateur events. It makes intuitive sense that parents, when compared to adults without children, have much more reason to go to little league games, AYSO soccer matches, and other sporting events in which their children participate.

Following the above discussion, I specify the final binary logit model:

Yij = β0 + β1[family inc.]j + β2[educ.]i + β3[age]i + β4[male]i + β5[black ]i … …+ β6[other race]i + β7[urban]j + β8[child]i + εi

Where Yij is the binary outcome indicating whether or not respondent i from household j attended an amateur or professional sporting event. Because the GSS uses a two-stage probability sample (random sample of households first, then a random selection of one individual within each household), the final model is weighted to account for the number of adults in each respondent’s household. The probability weights correct for the fact that the two-stage sampling method decreases the probability that an individual in a large household will be selected relative to an individual in a smaller household (i.e. the GSS oversamples individuals from smaller households).

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Results

Table A.A.2 lists the results of the final binary logit model. In terms of significance and the direction of effects, they confirm the conclusions reached by Wilson.

Both family income and education are positively and significantly (p < 0.001 level)

associated with the likelihood of having attended a sporting event. The exponentiated

coefficients indicate that, all else being equal, each additional $10,000 in family income

increases the odds of attending a sporting event by approximately 13 percent. Each

additional year of education increases the odds of attendance by 18 percent, all else being

equal. The standardized, exponentiated coefficients for family income and education

(1.4495 and 1.6294, respectively), confirms in line with Wilson that a one standard

deviation increase in educational attainment has a larger effect on the probability of

attendance than a one standard deviation increase family income.

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Table A.A.2. Regression of Probability of Having Attended a Sporting Event in the Previous Year on Individual- and Household-Level Variables (n = 1,396). β eβ Individual-level Education 0.166555*** 1.1812 (0.026963) Age -0.030523*** 0.9699 (0.004173) Race Black -0.206918 0.8131 (0.207523) Other -0.446139 0.6401 (0.312334) Sex Male 0.416910** 1.5173 (0.130278) Has a child Yes 0.057399 1.0591 (0.159188) Household-level Family income (1992 dollars) 0.000012*** 1.0000 (0.000003) Community type Urban 0.130944 1.1399 (0.137070) Observations 1396 Log pseudolikelihood -817.2929 AIC 1652.586 BIC 1699.758 Notes: Standard errors (robust) in parentheses. Reference categories are white, female, does not have child, and rural. ***p < 0.001, **p < 0.01 Source: National Opinion Research Center, General Social Survey, 1993 (Chicago, IL: University of Chicago, 1993).

Figures 2.6 and 2.7 (see main text, Chapter 2) graph the predicted probabilities of sporting event attendance as a function of income and education, respectively, for white male respondents who live in urban areas, and who have at least one child. Figure 2.6 suggests that, based on the 1993 data, coming from a family reporting no annual income corresponds to just over a 0.50 probability of having attended a sporting event. The

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probability increases more or less linearly with income; the probability for respondents

from families reporting more than $200,000 in annual income is more than 0.90. In short,

it appears that while family income is not a serious barrier to having attended at least one

amateur or professional sporting event, increased income makes attendance much more

likely.

Figure 2.7 suggests that the intricacies of the relationship between education and

sporting event attendance are somewhat different. The relationship is still positive and

more or less linear. However, the probability curve indicates that those with no or very

low levels of education are extremely unlikely to have attended a sporting event. This has

limited substantive significance, since few Americans fall into the < 5 years of education

category. Nevertheless, it raises questions about whether or not schooling plays an

important role in providing initial exposure to sports spectatorship.

According to Table A.1.2, age and gender are also significantly associated with

the probability of attendance, both in the direction predicted above. For each additional

year of age, the odds of having attended a sporting event decrease by 3 percent

(significant at the p < 0.001 level). Being male increases the odds of attendance by 52

percent relative to females (significant at the p < 0.01 level). The coefficients for race, community type, and parental status are not statistically significant.

Discussion

The results confirm that, at least during the 1990s, wealthier and more educated

individuals were more likely to attend amateur or professional sporting events. However,

given the construction of the dataset by the GSS, many questions remain as to precise

nature of the relationship between socioeconomic capital and attendance.

426

Since the survey question used to measure the binary outcome in the specified

logit model did not differentiate between professional and amateur sporting events, it is

difficult to draw any concrete conclusions about the degree to which the results

corroborate arguments made about class polarization in spectatorship at professional

sporting events. Since many amateur events charge relatively low prices for admission

(or are even free), it is very likely that more low-income respondents to the 1993 GSS answered “yes” to the survey question than would have been the case had the question dealt exclusively with professional sporting events. That both Wilson’s MCA and the binary logit model used in this paper show education to be the strongest predictor of event attendance might be the result of this bundling of “amateur” and “professional”

events in the survey question. For example, recent high-school graduates from low-

income households may have attended local high-school games on a regular basis, and

college students or recent college graduates with low earnings (but living on their own)

may still have made it a point to attend collegiate contests.

This is not to say that these results have no use to researchers interested in the link

between economic capital of spectators and the “luxurification” of professional sport in

recent decades. That the effect of income is significant despite the structure of the survey

question (and remains significant after controlling for education) suggests that economic

capital played an important role in the extent of individuals’ participation as live

spectators at all types sporting events in the early nineties. Unfortunately, the GSS data

provides few clues as to the mechanisms behind this relationship. It may be a function of

ticket prices, leisure time, access to transportation, or a combination thereof.

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Appendix B

The Cook County Property Tax System and United Center Savings Estimates

In Cook County, tax liabilities for a residential property depend on four factors.

The first is the property’s “fair market value” (FMV) or “fair cash value” (FCV). The

assessor employs something called the “sales approach” to determine the fair market

value of homes. This approach uses data on recent sale prices of comparable properties to

estimate residential fair market values.1 The second factor is the assessment level, or the

rate (i.e. percentage of FMV) at which property is assessed (through tax year 2008, Cook

County assessed residential property at 16% FMV, and has assessed it at 10% FMV

since).2 A property’s “assessed value” (AV) is determined by multiplying the fair market

value by the assessment level.

The third factor is the “equalization factor” (EF) or “equalization multiplier.” The

State of Illinois determines the equalization factor each year to ensure that the assessment

level on the total assessed value of properties in all counties equals 33.3% (the stated

intent behind the equalization process is to distribute the property tax burden equally

throughout the state). Multiplying the assessed value by the equalization factor yields the

“equalized assessed value” (EAV). The final factor is the actual tax rate. Keep in mind

that the Cook County Clerk determines the tax rate after taxing bodies like local school

districts issue their budget requests, or “levies.” The County Clerk’s office calculates the

11 Illinois Department of Revenue, The Illinois Property Tax System: A General Guide to the Local Property Tax Cycle, accessed July 10, 2010, http://tax.illinois.gov/publications/localgovernment/ptax1004.pdf, 10-11.

2 The Civic Federation, The Cook County Property Assessment Process: A Primer on Assessment, Classification, Equalization and Property Tax Exemptions, April 5, 2010, accessed July 10, 2013, http://www.civicfed.org/sites/default/files/100405_CookCountyAssessmentPrimer.pdf, 12. 428

tax rate simply by dividing the total property tax levy by the total tax base (i.e. the total

EAV).3 So, in the end, the formula for calculating a residential tax bill is:

Tax Billresidential = (Fair Market Value) x (Assessmt. Level) x (Equaliz. Factor) x (Tax Rate)

or, in simplified form…

Tax Billresidential = (Equalized Assessed Value) x (Tax Rate)

In Cook County, the formula for determining commercial property tax obligations

differs from the one used for determining residential property tax bills. Much of the

difference has to do with variations in the way the assessor determines the fair market

value for each. Instead of using the sales approach, the Assessor’s Office employs

something called the “income approach.” The income approach tries to account for the

fact that, unlike residential properties, the value of commercial properties depends in part

on their potential for generating future commercial income.4 To determine fair market

value using the income approach, the Assessor’s Office multiples a commercial

property’s annual net income (i.e. profits) by a special multiplier based on that property’s

capitalization rate (a measure of rate of return on investment in the property). This

multiplier is called the “net income multiplier.”5

3 The tax rate to be applied to assessed values for a particular tax year is calculated by the Cook County Clerk—and actual billing and payment are conducted—in the year following the tax year. So, for example, property tax bills based on assessments determined for the 2012 tax year would be mailed to property owners during the 2013 calendar year. See, for example, See Cook County Clerk’s Office, “Clerk Orr Releases 2012 Tax Rates,” press release, accessed October 20, 2013, http://www.cookcountyclerk.com/tsd/DocumentLibrary/2012%20Tax%20Rate%20Report.pdf.

4 Illinois Department of Revenue, The Illinois Property Tax System, 10-11.

5 Dennis Carr, Jeff Lawson, and J. Carl Schultz, Mastering Real Estate Appraisal (Chicago, IL: Dearborn Financial Publishing, 2003), 344. There are additional time lags involved in the commercial property tax cycle. The net income figures on which commercial property assessments are based come from the preceding fiscal year. In other words, commercial assessments for tax year 2012 are based on income data from fiscal year 2011. This means that actual billing and payment executed during 2013 is based on net 429

Assessment levels for commercial properties also differ from those for residential ones. Through tax year 2008, Cook County assessed commercial properties at 38% of fair market value (as opposed to 16% for residential); that number dropped to 25% as a result of legislation passed in 2008. While assessment levels and the formula for calculating fair market value differ for commercial and residential properties, the same equalization factor and tax rate apply to both (though each of these numbers varies from year to year).

So, the formula for calculating the tax bill for a commercial property is:

Tax Billcommercial = (Net Income) x (Net Inc. Mult.) x (Assessmt. Level) x (Equaliz. Factor) X (Tax Rate)

…or, in simplified form...

Tax Billcommercial = (Fair Market Value) x (Assessmt. Level) x (Equaliz. Factor) X (Tax Rate)

…or, further simplified...

Tax Billcommercial = (Equalized Assessed Value) x (Tax Rate)

Legislation passed in 1989 by the Illinois General Assembly mandated that the

Cook County Assessor value the United Center according to a special formula. This formula includes several key provisions that have drastically reduced the property tax bill for the arena. First, it fixed the assessment level of the United Center at 20%, significantly below the 38% percent standard used for commercial properties through tax year 2008 (and below the current rate of 25%). The special formula also ensured the underestimation of the arena’s “net income,” which the Assessor’s Office uses to determine its fair market value. It did this by allowing for several atypical deductions from the arena’s reported net income. These deductions include income taxes, annual

income data from at least two years prior (“at least” because not all properties are re-assessed every year; in fact, in Cook County most properties are only re-assessed once every three years). See Illinois Department of Revenue, The Illinois Property Tax System. 430

replacement/maintenance costs, and mortgage interest. Table A.B.1 shows how these

deductions allowed United Center ownership to claim an “adjusted net income” that, in

certain years, amounted to as little as 3 percent of actual net income.6

Table A.B.1. Net Income Adjustments for United Center, Fiscal Years 1996-2010.a Fiscal Actual Net Depreciation Back Interest Income Tax Replacement Mort. Interest Adjusted Net Adjusted/ Year Income (add) (add) (deduct) Costs (deduct) (deduct) Income Actual 1996 19,231,094 10,853,344 11,311,727 7,628,975 2,683,000 14,950,423 16,133,767 0.84 1997 21,790,968 8,872,601 9,404,151 8,644,477 1,099,020 15,257,748 15,066,475 0.69 1998 20,872,858 7,497,472 7,342,604 8,280,263 899,000 15,095,047 11,438,624 0.55 1999 29,795,378 6,923,454 3,345,706 11,819,826 3,298,807 14,462,320 10,483,585 0.35 2000 31,296,064 7,291,197 992,334 12,415,149 9,594,388 16,703,980 866,078 0.03 2001 31,564,728 8,601,635 0 12,521,728 3,911,345 12,491,829 11,241,461 0.36 2002 29,583,315 8,601,937 0 11,735,701 3,077,000 8,442,379 14,930,172 0.50 2003 29,003,815 6,542,994 0 11,505,813 1,267,000 7,448,095 15,325,901 0.53 2004 16,153,032 5,895,223 0 6,407,908 1,188,368 7,845,809 6,606,170 0.41 2005 18,117,704 5,642,023 0 7,187,293 1,352,521 11,190,220 4,029,693 0.22 2006 31,233,134 6,077,558 0 12,390,184 4,683,713 14,408,086 5,828,709 0.19 2007 25,943,925 6,056,994 0 10,291,955 2,883,000 14,552,710 4,273,254 0.16 2008 32,446,174 6,387,604 0 12,871,397 4,364,000 9,183,573 12,414,808 0.38 2009 30,443,568 6,903,042 0 12,076,963 8,880,000 5,875,318 10,514,329 0.35 2010 33,335,513 8,327,294 0 13,224,198 2,833,000 6,327,265 19,278,344 0.58 Source: Cook County Assessor’s Office, Freedom of Information Act Request (2013). a All data except “Adjusted/Actual” field transcribed directly from revenue statements provided to Cook County Assessor by United Center legal counsel. The statements list no data for “back interest” for fiscal years 2001-2010. “Fiscal year” refers to the year during which the net income is generated. Values not adjusted for inflation.

In addition to the reduced assessment level and net income deductions, the

legislation fixed the net income multiplier at 4 (i.e. mandated that the Assessor’s Office

multiply net income by 4 in order to determine fair market value). As pointed out above,

the net income multiplier is a function of a property’s capitalization rate. For the purposes

of this appendix, the details behind the calculation of capitalization rates for commercial

6 Amendment #1 to Senate Bill 2321, June 30, 1989, Illinois State Archives, Springfield, Illinois. While the language is somewhat ambiguous, the amendment suggests that, unlike typical properties in Cook (which are re-assessed every three years), the United Center receives a yearly re-assessment. This is also indicated by the documents containing United Center income data from the Cook County Assessor’s Office. Cook County Assessor’s Office, Freedom of Information Act Request, order number 62939, transaction no. 62013, March 28, 2013.

431

properties matter less than the simple point that the capitalization rate is the inverse of the net income multiplier.7 In other words:

Capitalization Rate = 1 / Net Income Multiplier

…or…

Net Income Multiplier = 1/Capitalization Rate

By setting the net income multiplier for the arena at 4, the state required that the

Assessor’s Office assume a 25% (0.25) capitalization for the United Center. As the formulas above show, higher capitalization rates result in lower net income multipliers.

Data from real estate industry sources indicate that, during the 2000s, average capitalization rates for commercial property (all types) fluctuated between 5% and 10%.

This range corresponds to net income multipliers as high as 20 and as low as 10. In other words, the average net income multiplier for commercial properties has typically sat somewhere around two to five times the one stipulated for the United Center by the

General Assembly.8

The special provisions secured by Reinsdorf and Wirtz yielded a final formula for calculating the arena’s tax liabilities that differed considerably from what it would have been under normal procedures for assessing commercial property. In the adjusted formula, the absolute value of net income drops dramatically, and two of the key multipliers—the net income multiplier and the assessment level—also shrink:

7 On the relationship between the net income and capitalization rate, see Carr, Lawson, and Schultz, 344.

8 Bendix Anderson, “Investors Pay Top Dollar, Cap Rates Continue Falling,” National Real Estate Investor, May 1, 2012, web, accessed July 10, 2013, http://nreionline.com/news/investors_pay_top_dollar_cap_rates_05012012/> This corroborates Chuck Neubauer’s initial investigation of the tax deal. See Chuck Neubauer, “Stadium Snares Huge Tax Breaks Under State Law.” 432

Normal Tax Bill = [(Net Income) x 8] x 0.38 x (Equalization Factor) x (Tax Rate)

vs.

Adjusted Tax Bill = [(Adjusted Net Income) x 4] x 0.20 x (Equaliz. Factor) x (Tax Rate)

To reiterate, these formulas reflect property tax statutes as they existed before 2009.

Since 2009, assessment levels for certain classes of property (including commercial) have changed, and I adjust for these changes in the computations included below.9

Since a property’s tax bill depends on multiplying the various factors together, the reductions outlined above had a big impact on the United Center’s bottom line.

Admittedly, determining the exact amount saved on property taxes by Reinsdorf and company proves difficult, mostly because such an exercise would require unavailable data on fluctuations in actual capitalization rates for the United Center. In addition, assessment levels used in practice have historically varied somewhat from the statutory levels, and the information required to track these variations is not readily available.10

Despite these limitations, it is possible to estimate the tax savings that have accrued to Reinsdorf and his co-owners with some degree of confidence. This involves first calculating a range for what United Center ownership would have owed in property taxes without the adjusted tax bill formula. In order to compute a lower bound estimate, I apply the normal tax bill estimate formula above to the data from the Cook County

Assessor, but keep the net income multiplier at 4 (i.e. the level mandated by the special legislation) rather than using the more realistic figure of 8, which Neubauer suggested in

9 Civic Federation, The Cook County Property Assessment Process, 12.

10 Civic Federation, The Cook County Property Assessment Process, 14-15. 433

his initial investigation.11 This produces a very conservative estimate, since we know that the United Center’s net income multiplier would have exceeded 4 in each year under consideration had the Assessor’s Office valued it according to conventional practice.

However, lacking more precise data on what the net income multiplier for the arena would have been under normal circumstances, I give Reinsdorf and company the benefit of the doubt. This conservative estimation technique suggests that United Center ownership would have owed a total of about $108.5 million (constant 2011 dollars) in property taxes for tax years 1997-2011. Table A.B.2 reproduces these calculations.

However, as noted above, we know for a fact that the tax abatement legislation caps the net income multiplier for the United Center at 4 because, under normal circumstances, this value would be higher. As shown in Table A.B.3, applying

Neubauer’s estimate of 8 for a normal net income multiplier, the total estimated tax bill for tax years 1997-2011 would have totaled approximately $216.9 million (constant 2011 dollars). This represents a more realistic estimate of what the United Center would have owed, and though it may seem extremely high, keep in mind that the arena cleared over

$460 million in profits during this period.12

11 Chuck Neubauer, “Stadium Snares Huge Tax Breaks Under State Law.”

12 Values in Tables 6.7 and 6.8 are adjusted for inflation using the Bureau of Labor Statistics Urban Consumer Price Index (CPI-U) for the Chicago Metropolitan Statistical Area (MSA). I match the CPI index year to the tax year. Since billing and payment are technically executed in the year following the tax year, there is an argument for adjusting for inflation by using the CPI index for year X+1 when adjusting data from tax year X. However, for the sake of simplicity—and because there is little substantive difference—I match CPI year X with tax year X. 434

Table A.B.2. Estimated United Center Tax Liabilities Using Actual Net Income, 38% Assessment Level (25% for Tax Years Post-2008), and Net Income Multiplier of 4, Tax Years 1997-2011. Assessed Value Equal- CPI-U Calculated Tax Fair Cash Value (FCV * .38 through 2008, ization Equalized Tax Rate Calculated Tax (Chicago Liability (adjusted Tax Year Net Income (Net Income * 4) FCV * .25 after 2008) Factor Assessed Value (commercial) Liability MSA) for inflation) 1997 19,231,094 76,924,376 29,231,263 2.1489 62,815,060.80 8.8430 5,554,735.83 161.700 7,512,256.34 1998 21,790,968 87,163,872 33,122,271 2.1799 72,203,239.34 8.8720 6,405,871.39 165.000 8,490,070.18 1999 20,872,858 83,491,432 31,726,744 2.2505 71,401,037.73 8.5360 6,094,792.58 168.400 7,914,688.96 2000 29,795,378 119,181,512 45,288,975 2.2235 100,700,034.93 7.7880 7,842,518.72 173.800 9,867,855.95 2001 31,296,064 125,184,256 47,570,017 2.3098 109,877,225.91 7.6920 8,451,756.22 178.300 10,366,033.97 2002 31,564,728 126,258,912 47,978,387 2.4689 118,453,838.58 7.2770 8,619,885.83 181.200 10,403,041.47 2003 29,583,315 118,333,260 44,966,639 2.4598 110,608,938.12 6.4330 7,115,472.99 184.500 8,433,821.65 2004 29,003,815 116,015,260 44,085,799 2.5757 113,551,791.97 6.2730 7,123,103.91 188.600 8,259,325.85 2005 16,153,032 64,612,128 24,552,609 2.7320 67,077,726.80 5.9810 4,011,918.84 194.300 4,515,401.23 2006 18,117,704 72,470,816 27,538,910 2.7076 74,564,352.93 5.3020 3,953,401.99 198.300 4,359,787.00 2007 31,233,134 124,932,536 47,474,364 2.8439 135,012,342.87 4.9940 6,742,516.40 204.818 7,198,978.88 2008 25,943,925 103,775,700 39,434,766 2.9786 117,460,394.01 4.8160 5,656,892.58 212.536 5,820,528.74 2009 32,446,174 129,784,696 32,446,174 3.3701 109,346,851.00 4.6270 5,059,478.80 209.995 5,268,825.74 2010 30,443,568 121,774,272 30,443,568 3.3000 100,463,774.40 4.9310 4,953,868.72 212.870 5,089,170.98 2011 33,335,513 133,342,052 33,335,513 2.9706 99,026,474.92 5.0455 4,996,380.79 218.684 4,996,380.79 Totals 108,496,167.73 Source: Cook County Assessor’s Office, Freedom of Information Act Request (2013). Inflation adjustments made using CPI-U for Chicago Metropolitan Statistical Area (MSA).

Table A.B.3. Estimated United Center Tax Liabilities Using Actual Net Income, 38% Assessment Level (25% for Tax Years Post-2008), and Net Income Multiplier of 8, Tax Years 1997-2011. Assessed Value Equal- CPI-U Calculated Tax Fair Cash Value (FCV * .38 through 2008, ization Equalized Tax Rate Calculated Tax (Chicago Liability (adjusted Tax Year Net Income (Net Income * 8) FCV * .25 after 2008) Factor Assessed Value (commercial) Liability MSA) for inflation) 1997 19,231,094 153,848,752 58,462,526 2.1489 125,630,121.61 8.8430 11,109,471.65 161.700 15,024,512.67 1998 21,790,968 174,327,744 66,244,543 2.1799 144,406,478.68 8.8720 12,811,742.79 165.000 16,980,140.36 1999 20,872,858 166,982,864 63,453,488 2.2505 142,802,075.46 8.5360 12,189,585.16 168.400 15,829,377.92 2000 29,795,378 238,363,024 90,577,949 2.2235 201,400,069.87 7.7880 15,685,037.44 173.800 19,735,711.90 2001 31,296,064 250,368,512 95,140,035 2.3098 219,754,451.83 7.6920 16,903,512.43 178.300 20,732,067.94 2002 31,564,728 252,517,824 95,956,773 2.4689 236,907,677.16 7.2770 17,239,771.67 181.200 20,806,082.93 2003 29,583,315 236,666,520 89,933,278 2.4598 221,217,876.24 6.4330 14,230,945.98 184.500 16,867,643.31 2004 29,003,815 232,030,520 88,171,598 2.5757 227,103,583.94 6.2730 14,246,207.82 188.600 16,518,651.70 2005 16,153,032 129,224,256 49,105,217 2.7320 134,155,453.61 5.9810 8,023,837.68 194.300 9,030,802.47 2006 18,117,704 144,941,632 55,077,820 2.7076 149,128,705.87 5.3020 7,906,803.98 198.300 8,719,573.99 2007 31,233,134 249,865,072 94,948,727 2.8439 270,024,685.74 4.9940 13,485,032.81 204.818 14,397,957.77 2008 25,943,925 207,551,400 78,869,532 2.9786 234,920,788.02 4.8160 11,313,785.15 212.536 11,641,057.48 2009 32,446,174 259,569,392 64,892,348 3.3701 218,693,701.99 4.6270 10,118,957.59 209.995 10,537,651.48 2010 30,443,568 243,548,544 60,887,136 3.3000 200,927,548.80 4.9310 9,907,737.43 212.870 10,178,341.96 2011 33,335,513 266,684,104 66,671,026 2.9706 198,052,949.84 5.0455 9,992,761.58 218.684 9,992,761.58 Totals 216,992,335.45 Source: Cook County Assessor’s Office, Freedom of Information Act Request (2013). Inflation adjustments made using CPI-U for Chicago Metropolitan Statistical Area (MSA).

In order to estimate the difference between these estimates and what Reinsdorf and company actually paid, I simply computed the difference between each one and the actual payments, and made the appropriate inflation adjustments. Tables A.B.4 and A.B.5 show these calculations. The most conservative estimation formula shows that during the years in question, arena ownership paid more than $81.3 million (constant 2011 dollars) less than they would have under standard assessment procedure. Using estimates based

435

on a net income multiplier of 8 instead of 4, the calculated savings jump to more than

$189.7 million.13

Table A.B.4. Difference between Standard/Counterfactual Tax Liabilities (Net Income Multiplier = 4) and Actual Tax Payments for the United Center for Tax Years 1997-2011. Actual Tax Counterfactual Payment CPI-U Calculated less Tax Liability (per Assessor's Calculated less (Chicago Actual (adjusted for Tax Year (NIM = 4) records) Actual MSA) inflation) 1997 5,554,735.83 2,382,735 3,172,000.83 161.700 4,289,831.97 1998 6,405,871.39 2,332,645 4,073,226.39 165.000 5,398,481.46 1999 6,094,792.58 1,830,261 4,264,531.58 168.400 5,537,914.63 2000 7,842,518.72 1,452,308 6,390,210.72 173.800 8,040,488.15 2001 8,451,756.22 1,002,830 7,448,926.22 178.300 9,136,068.32 2002 8,619,885.83 1,625,205 6,994,680.83 181.200 8,441,637.88 2003 7,115,472.99 1,737,160 5,378,312.99 184.500 6,374,802.16 2004 7,123,103.91 1,461,588 5,661,515.91 188.600 6,564,596.74 2005 4,011,918.84 1,001,475 3,010,443.84 194.300 3,388,244.47 2006 3,953,401.99 893,788 3,059,613.99 198.300 3,374,123.18 2007 6,742,516.40 1,007,487 5,735,029.40 204.818 6,123,285.89 2008 5,656,892.58 1,013,212 4,643,680.58 212.536 4,778,007.69 2009 5,059,478.80 1,550,108 3,509,370.80 209.995 3,654,578.65 2010 4,953,868.72 1,376,218 3,577,650.72 212.870 3,675,365.10 2011 4,996,380.79 2,498,489 2,497,891.79 218.684 2,497,891.79 Totals 81,275,318.08 Source: Cook County Assessor’s Office, Freedom of Information Act Request (2013). a All inflation-adjusted values in 2011 dollars (using CPI-U for Chicago Metropolitan Statistical Area).

13 It’s also worth noting that, according to their own internal documentation, Reinsdorf and Wirtz appear to have violated the law in tax year 2006, when actual tax liabilities on the United Center totaled less than $900,000. In order to smooth the passage of the 1989 legislation, the two owners agreed to pay a minimum of $1 million in annual property taxes, even when the adjusted net income dropped below the threshold needed to produce a $1 million tax bill. Since they failed to meet the $1 million minimum, they were in violation of state law. There is no record of any repercussions for this violation. Illinois 86th General Assembly, House of Representatives. Amendment #1 to Senate Bill 2321, June 30, 1989, Illinois State Archives, Springfield, Illinois. 436

Table A.B.5. Difference between Standard/Counterfactual Tax Liabilities (Net Income Multiplier = 8) and Actual Tax Payments for the United Center for Tax Years 1997-2011. Actual Tax Counterfactual Payment CPI-U Calculated less Tax Liability (per Assessor's Calculated less (Chicago Actual (adjusted for Tax Year (NIM = 8) records) Actual MSA) inflation) 1997 11,109,471.65 2,382,735 8,726,736.65 161.700 11,799,713.68 1998 12,811,742.79 2,332,645 10,479,097.79 165.000 13,885,757.21 1999 12,189,585.16 1,830,261 10,359,324.16 168.400 13,449,896.88 2000 15,685,037.44 1,452,308 14,232,729.44 173.800 17,904,740.88 2001 16,903,512.43 1,002,830 15,900,682.43 178.300 19,498,178.39 2002 17,239,771.67 1,625,205 15,614,566.67 181.200 18,840,887.73 2003 14,230,945.98 1,737,160 12,493,785.98 184.500 14,805,644.26 2004 14,246,207.82 1,461,588 12,784,619.82 188.600 14,820,939.97 2005 8,023,837.68 1,001,475 7,022,362.68 194.300 7,902,055.46 2006 7,906,803.98 893,788 7,013,015.98 198.300 7,732,354.08 2007 13,485,032.81 1,007,487 12,477,545.81 204.818 13,319,584.29 2008 11,313,785.15 1,013,212 10,300,573.15 212.536 10,596,403.97 2009 10,118,957.59 1,550,108 8,568,849.59 209.995 8,921,608.97 2010 9,907,737.43 1,376,218 8,531,519.43 212.870 8,762,772.62 2011 9,992,761.58 2,498,489 7,494,272.58 218.684 7,492,764.71 Totals 189,733,303.11 Source: Cook County Assessor’s Office, Freedom of Information Act Request (2013). a All inflation-adjusted values in 2011 dollars (using CPI-U for Chicago Metropolitan Statistical Area).

While these calculations are adjusted for inflation, they are not converted to

“present value.” In other words, they do not account for the financial gains that accrued to United Center ownership as a result of their ability to generate additional investment income from their property tax savings.

How the United Center Tax Breaks Hurt “Ordinary” Residents and Starve Chicago’s Public School System

Public institutions in Cook County that depend on property-tax revenue are referred to as “property-taxing bodies.” Each year, taxing bodies such as public school districts use the budgeting process to project expenditures for the coming year. After this process is complete, districts like Chicago Public Schools (CPS) issue their “levy,” or the amount of property taxes they need in order to support the proposed budget. School districts and other taxing bodies issue their levies before Cook County determines

437

property tax rates for Chicago and other municipalities in the county, and these taxing

bodies are restricted in how much they can increase levies in at least two ways. First,

state law prohibits taxing districts from increasing levies by more than 5% of the total tax

bill for the previous year. Second, political pressure from taxpayers upset by increasing

tax bills may make it unrealistic for taxing bodies to ask for more money, even in the case

of legitimate shortfalls. Keep in mind, even if property values decrease or stay the same,

tax bills can rise as a result of higher levies (since higher levies mean that the County

Clerk has to raise tax rates in a given taxing district).14

When commercial properties like the United Center receive massive property tax breaks from the state, Chicago’s homeowners and low-income residents are asked to pay more in residential property taxes and/or cope with reduced public provision of social services to make up for the gap left in the tax base. The gross under-assessment of the

United Center and other commercial properties enjoying special breaks effectively reduces the city’s overall tax base (i.e. the assessed value of all of the property in the district). This may mean that the Cook County Clerk has to raise the property tax rates in order to satisfy the levies issued by schools and other taxing bodies. While this affects all homeowners—at least all of those who do not file successful property tax appeals—it no doubt takes a particularly tough toll on working- and middle-class homeowners struggling to keep up with mortgage payments. Renters also pay a price, as landlords pass along increased property taxes in the form of higher rents.15 In scenarios in which raising

14 For more on these processes, see Illinois Department of Revenue, The Illinois Property Tax System.

15 For a lucid exposition of this argument by a local journalist with decades of experience writing about property taxes in Chicago, see Ben Joravsky, “TIFs: The Tax Bill You Have to Pay But Never See,” Chicago Reader, December 12, 2012, accessed July 10, 2013, http://www.chicagoreader.com/chicago/rahm-emanuel-keeps-control-of-tif-money/Content?oid=8175391. 438

tax rates would be politically unsustainable for local legislators, these legislators are

likely to pursue austerity measures (i.e. budget cuts) in order to control increases in levies issued by taxing bodies. Of course, poor and working Chicagoans—homeowners or

otherwise—typically bear the brunt of these measures, as the cuts are more likely to

target social services and other traditional redistribution programs. Given the fact that local schools depend on property tax levies for an undue portion of their funding, reduced or stagnant levies promise to have especially dire consequences for public education.

One potential objection to this characterization of the wider impact of tax

abatements is that such abatements stimulate ancillary growth and, over the long term,

help promote an expansion of the local tax base. However, recent research has found little

correlation between the use of such “incentives” and growth in local tax bases.16

16 See, for example, Lingwen Zheng and Mildred Warner, “Business Incentive Use Among U.S. Local Governments: A Story of Accountability and Policy Learning,” Economic Development Quarterly 24, no. 4 (2010): 325-336. 439

Appendix C

United Center Amusement Tax Savings

Table A.C.1 shows the calculations for determining the savings that accrued to

Reinsdorf and Wirtz as a result of the Chicago City Ordinance exempting 40 percent of skybox revenue from the amusement tax. “Fiscal year” denotes the year in which the taxable revenue was produced. This differs from the label “tax year” used above to discuss property taxes. Since commercial property tax assessments executed during a “tax year” are based on income generated in prior years, and bills are not released until the year after the “tax year,” there is at least a two year gap between when a property generates income and when a bill for tax on that income is issued/paid.1 In the case of

excise taxes like the amusement tax, the merchant is billed the year after the taxable

revenue is produced (i.e. the year after the “fiscal year”).

As with the property tax calculations in Appendix B, these figures are not

converted to “present value” using prevailing discount rates, and thus underestimate the

total financial benefit that accrued to United Center as a result of the breaks.

Table A.C.1. United Center City Amusement Tax Savings (Suites Only), Fiscal Years 2002-2007. Amuse- Liability Absent Actual Liability CPI-U Counterfactual - Fiscal Suite License Fees ment Tax Ordinance 60% of Suite License (Accounting for Counterfactual - (Chicago Actual (Adjusted for Year (Net) Rate (Counterfactual) Fees Ordinance) Actual MSA) Inflation) 2002 28,013,933.00 0.07 1,960,975.31 16,808,359.80 1,176,585.19 784,390.12 181.200 886,629.23 2003 28,264,187.00 0.07 1,978,493.09 16,958,512.20 1,187,095.85 791,397.24 184.500 878,549.59 2004 20,654,596.00 0.07 1,445,821.72 12,392,757.60 867,493.03 578,328.69 188.600 628,060.05 2005 17,352,845.00 0.08 1,388,227.60 10,411,707.00 832,936.56 555,291.04 194.300 585,350.49 2006 26,676,637.00 0.08 2,134,130.96 16,005,982.20 1,280,478.58 853,652.38 198.300 881,711.42 2007 24,671,689.00 0.08 1,973,735.12 14,803,013.40 1,184,241.07 789,494.05 204.818 789,494.05 Totals 4,649,794.82 Source: Cook County Board of Review, Freedom of Information Act Request (2011). All inflation-adjusted values in constant 2008 dollars.

1 So, for example, Cook County mails its property tax bills for tax year 2012 to property holders in 2013, after the Cook County Clerk calculates the tax rate that will be applied to equalized assessed values determined for assessments determined in 2012. See Cook County Clerk’s Office, “Clerk Orr Releases 2012 Tax Rates,” press release, accessed October 20, 2013, http://www.cookcountyclerk.com/tsd/DocumentLibrary/2012%20Tax%20Rate%20Report.pdf. 440

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Books, Articles, and Working Papers

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Anderson, David. “The Sports Broadcasting Act: Calling It What It Is—Special Interest Legislation.” Hastings Communication and Entertainment Law Journal 17 (1995): 945-958.

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Arena, John. Driven from New Orleans: How Nonprofits Betray Public Housing and Promote Privatization. Minneapolis, MN: University of Minnesota Press, 2012.

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Austin, Regina. “ ‘An Honest Living’: Street vendors, Municipal Regulation, and the Black Public Sphere.” Yale Law Journal 103, no. 8 (June 1994): 2157-2178.

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Baker, Dean. Plunder and Blunder: The Rise and Fall of the Bubble Economy. Sausalito, CA: Polipoint, 2009.

Bass, Amy. Not the Triumph but the Struggle: The 1968 Olympics and the Making of the Black Athlete. Minneapolis: University of Minnesota Press, 2004.

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Booth, Douglas. “History, Culture, Surfing: Exploring Historiographical Relationships.” Journal of Sport History 40, no. 1 (Spring 2013): 3-20.

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Bruno, Robert, and Alison Dickson Quesada. Tax Increment Financing and Chicago Public Schools: A New Approach to Comprehending a Complex Relationship. University of Illinois at Urbana-Champaign Labor Education Program White Paper Series. Urbana, IL: University of Illinois at Urbana-Champaign, December 2011.

Burgos, Adrian. Playing America’s Game: Baseball, Latinos, and the Color Line. Berkeley: University of California Press, 2007.

Buss, Terry. “The Effect of State Tax Incentives on Economic Growth and Firm Location Decisions: An Overview of the Literature.” Economic Development Quarterly 15, no. 1 (February 2001): 90-105.

Cagan, Joanna, and Neil DeMause. Field of Schemes: How the Great Stadium Swindle Turns Public Money Into Private Profit. Lincoln, NE: University of Nebraska, 2008.

Cahn, Susan. Coming on Strong: Gender and Sexuality in Twentieth-Century Women’s Sport. Cambridge, MA: Harvard University Press, 1995.

Carl, Jim. “ ‘Good Politics Is Good Government’: The Troubling History of Mayoral Control of the Public Schools in Twentieth-Century Chicago.” American Journal of Education 115 (February 2009): 305-336.

Carr, Dennis, Jeff Lawson, and J. Carl Schultz. Mastering Real Estate Appraisal Chicago, IL: Dearborn Financial Publishing, 2003.

Chaskin, Robert, and Mark Joseph. “Social Interaction in Mixed-Income Developments: Relational Expectations and Emerging Reality.” Journal of Urban Affairs 33, no. 2 (2011): 209-237.

Clark, Terry Nichols, ed. The City as Entertainment Machine. Boston, MA: Elsevier, 2004.

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Journal 13, no. 4 (1996): 366-397.

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Florida, Richard. The Rise of the Creative Class: And How It’s Transforming Work, Leisure, Community and Everyday Life. New York, NY: Basic Books, 2002.

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Fuchs, Ester. Mayors and Money: Fiscal Policy in New York and Chicago. Chicago, IL: University of Chicago Press, 1992.

Galbraith, James K. The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too. New York, NY: The Free Press, 2009.

Gilfoyle, Timothy. Millennium Park: Creating a Chicago Landmark. Chicago, IL: University of Chicago Press, 2006

Giroux, Henry. Stormy Weather: Katrina and the Politics of Disposability. Boulder, CO: Paradigm, 2006.

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Gratton, Chris, and Ian Henry, eds. Sport in the City: The Role of Sport in Economic and Social Regeneration. New York: Routledge, 2001.

Greenberg, Miriam. Branding New York: How a City in Crisis Was Sold to the World. New York, NY: Routledge, 2008.

Hall, Jacquelyn Dowd. “The Long Civil Rights Movement and the Political Uses of the Past.” The Journal of American History 91, no. 4 (2005): 1233-1263.

Hannigan, John. Fantasy City: Pleasure and Profit in the Postmodern Metropolis. New York, NY: Routledge, 1998.

Hardy, Stephen. How Boston Played: Sport, Recreation, and Community,1865-1915. Boston, MA: Northeastern University Press, 1982.

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Harvey, David. A Brief History of Neoliberalism. New York, NY: Oxford, 2005.

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Hausman, Jerry and Gregory Leonard. “Superstars in the National Basketball Association: Economic Value and Policy.” Journal of Labor Economics 15, no. 4 (October 1997): 586-624.

Hawley, Ellis W. The New Deal and the Problem of Monopoly: A Study in Economic Ambivalence. Princeton, NJ: Princeton University Press, 1966.

Helitzer, Melvin. The Dream Job: $port$ Publicity, Promotion and Marketing. Athens, OH: University Sports Press, 1996.

Henwood, Doug. After the New Economy. New York, NY: The New Press, 2003.

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Herman, Edward. Corporate Power: A Twentieth Century Fund Study. New York, NY: Cambridge University Press, 1982.

Hirsch, Arnold. Making the Second Ghetto: Race and Housing in Chicago, 1940-1960. New York, NY: Cambridge University Press, 1983.

Hout, Michael. “Getting the Most Out of the GSS Income Measures.” GSS Methodological Report 101. July 2004.

Hoyman, Michele, and Christopher Faricy. “It Takes a Village: A Test of the Creative Class, Social Capital, and Human Capital Theories.” Urban Affairs Review 44, no. 3 (January 2009): 311-333.

Hunt, D. Bradford. Blueprint for Disaster: The Unraveling of Chicago Public Housing. Chicago, IL: University of Chicago Press, 2009.

Jackson, Steven, David Andrews, and Cheryl Cole. “Race, Nation and Authenticity of Identity: Interrogating the ‘Everywhere’ Man (Michael Jordan) and the ‘Nowhere’ Man (Ben Johnson).” Immigrants and Minorities 17, no. 1 (1998): 82- 102.

Jaher, Frederic Cople. The Urban Establishment: Upper Strata in Boston, New York, Charleston, Chicago, and Los Angeles. Urbana, IL: University of Illinois, 1982.

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