Chicago Mayor Brandon Johnson’s willingness to raise local taxes is causing anger among business facilities in the Windy City. The Chicago Mercantile Exchange (CME), operating in the loop since 1898, is considering exiting the city if Johnson imposes “inappropriate” public policies. Johnson plans to introduce new taxes worth about $800 million, including a financial transactions tax that would make it impossible for the CME to do business in Chicago. Financial transactions tax would need to be approved by the state capitol, however, Governor JB Pritzker publicly rejected the idea.
Chicago’s economy is declining, and many landmark companies could leave the city at any moment. The fear of crime also influences many people’s decision to return to the Chicago office. In recent years, Chicago has seen a surge in crime, overall by 20%. Duffy, the CME Chairman, points out that the fear of crime complicates the choice of staying in the big city. The withdrawal of big companies such as CME has hit Chicago hard.
To rebuild Chicago, businesses need to feel confident in their hometown. Addressing the government’s pension debt is essential to rebuilding Chicago. Chicago’s primary pension plan holds her $48 billion unfunded pension liability over her 44 states in the United States. The statewide system owes her $140 billion, but independent estimates put the debt even higher. This has put pressure on taxes, doubling Chicago’s property taxes to $1.7 billion a year over the past decade.
Former mayors Lori Lightfoot and Rahm Emanuel called on state legislatures to push for pension reform, albeit after their terms expire. Mayor Johnson needs to address Chicago’s pension crisis if he wants businesses to believe he can stay home. He should use his position as one of Illinois’ most influential politicians to get legislators to support constitutional pension reform.
Chicago’s identity is tied to CME as much as the White Sox, Cubs, Vienna Beef Hot Dogs, and Lake Michigan. A “bad idea” policy is a risk the city cannot take. So do her colleagues on the East and West Coasts. Chicago needs to thrive to benefit from its landmark companies and confident businesses.