* 11/20/25 - Greg Hinz - Greg Hinz: Johnson's revolution runs aground as fiscal reality bites...........................
Buzz Sawyer
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Greg Hinz: Johnson's revolution
runs aground as fiscal reality bites
For the second year in a row, the City Council has handed Mayor Brandon Johnson an embarrassing defeat on his proposed new city budget. The setback came on a 10-25 vote when the Council’s Finance Committee rejected the controversial mix of borrowing, fund sweeps and new taxes that is at the core of the spending plan.
The brushback was fully deserved. Instead of consulting with council members and other stakeholders and proposing a shared-pain plan, Johnson once again acted as if he was elected not to lead a city but a populist revolution. He presented not a reasonable, sellable plan but a big, fat beast fit for Thanksgiving dinner.
As a result, with just a few weeks to go before the new year begins, Chicago teeters on the edge of a financial cliff that could haunt the city’s economy for many years to come.
Now, Johnson clearly inherited a difficult situation. Predecessor Richard M. Daley underfunded city pensions by tens of billions of dollars back when Chicago had money to spare. Successors including Johnson have scrambled to make up the shortfall, but at best have limited further bleeding. Even the normally sensible Gov. JB Pritzker recently made the situation even worse by approving a pension sweetener for city firefighters that will cost city taxpayers a whopping $11 billion in coming years.
That said, the crisis over the proposed 2026 city budget was as predictable as snow in January. It’s been clear for many, many months that a shortfall of more than $1 billion was looming. But instead of tightening the city’s belt and scrounging for every possible efficiency, Johnson took the easy way out, focusing for the most part on raising more revenue from a favorite target of his former employer, the Chicago Teachers Union: “billionaires” and “super-rich” corporations.
I happen to agree with Johnson that the wealthy and many large businesses pay too little in today’s America. But that’s a national problem requiring a national solution. Demanding, as his proposed budget does, that any company that employs more than 100 Chicagoans pony up $21 a month per worker is just a signal to companies to move to the suburbs, Indiana or Wisconsin. Or cut the pay of those Chicagoans who are still hired. Or both.
A proposed tax on cloud-accessed software falls in the same category. As does much of a $1 billion drawdown in tax-increment financing funds that are supposed to go to housing and economic development projects.
Somehow, no one at City Hall has heard the message that referendum voters sent when they rejected Pritzker’s proposed graduated income tax and Johnson’s “mansion tax” on residential sales. The message: Prove to us you’re spending available money in a careful way — that you’re really cutting the fat and sweetheart contracts — before asking us to pay more.
With Johnson reluctant to talk about cuts — by all appearances, he’s decided his path to re-election lies in playing to the uber-progressive left, rather than the sensible middle — it’s up to aldermen to offer alternatives.
They are talking. I’m told a plan is coming next week that will likely call for cuts in things such as wasted spending on rarely used heavy equipment and overly sweet employee health insurance, and savings from consolidated purchasing and faster payment of vendors to encourage more competition in contract bidding.
Business leaders have been at the table with the alders. Johnson’s head tax proposal and his accompanying rhetoric were seen as a declaration of war by those groups, an insult after businesses voluntarily donated more than $100 million in recent years for violence-prevention efforts. It’s been a long, long time in this town when such disparate organizations such as the Civic Committee of the Commercial Club, the Civic Federation, the Better Government Association and the Chicagoland Chamber of Commerce have been as united and upfront in a common cause.
Labor is at the table, too, I’m told. As is the case with business and the alders, they’ll need to put some skin in the game. We’ll see. Cuts and efficiencies first, folks. Revenue later.
A little farther down the road, big changes also are needed in another corner of city government that affects us all: Chicago Public Schools.
One reason why the city budget is swimming in red ink is CPS has sucked all the property-tax oxygen out of the local financial system. The city can’t raise property taxes for its own budget, even to keep with up with inflation, because CPS keeps caving into demands from the CTU for more, more, more.
Consider, over the past eight years, the amount CPS’ budget appropriates per enrolled student has soared 80%. Yes, 80%. In 2017, the district appropriated $6.3 billion. That was $16,662 for each of the 381,349 enrolled students. The 2025 budget appropriated $9.861 billion, or $30,313 for each of the 325,305 enrolled students. Final enrollment figures aren’t available for the current year, but with spending rising fast under the new CTU contract and enrollment at best flat, the nine-year figure could show per-student spending doubling. Yes, doubling.
That is not sustainable. As long as it continues, CPS and the city will have trouble getting more money from Springfield, even if deserved.
Beyond that, such increases put pressure on homeowners. Every time the CTU signs one of of those big new contracts it says it hopes to get the money from “millionaires” and “super-rich” corporations. But the union knows that, in reality, the money will end up coming from homeowners, something that lots of people in the South and West sides are figuring out now because, with Loop office towers selling for pennies on the dollar and under more pressure from Johnson’s proposed head tax, the money for CTU’s new contract has to come from them.
We’ll see if the people at the city budget bargaining table can figure that out. Ultimately, the only answer is to grow the city’s economy, spreading the tax load wider, so each of us pays less. Just hitting the same folks harder and harder every year is a losing game.
Greg Hinz is a columnist for Crain’s Chicago Business. He joined Crain’s in 1996 and was previously political editor of Chicago magazine and political editor and columnist for the Lerner Newspapers chai