A More Likely Reason Rahm Emanuel Dropped Out: The Chicago Time Bomb

We may never know why Rahm Emanuel decided to drop out of the Chicago mayoral race. But the media is certainly giving him a pass. They say he simply dropped out for fear of losing. But there’s a far more likely reason than that.

Emanuel is smart, and the smart reason for leaving is glaring: He doesn’t want to risk becoming “mayor bankruptcy.” Chicago is a ticking time bomb and Emanuel is jumping ship just in case it goes off.

Don’t dismiss that scenario too quickly. Despite his lofty intentions when he first took office, Emanuel has failed miserably to reform the city’s finances. Now the risk of insolvency is rising.

Chicago’s financials are dire and the city has no plan and no reserves to survive an inevitable recession. In fact, the city has barely kept its head above the water despite a decade of national economic growth. Chicago Public Schools was already at thebrink of bankruptcy just one year ago.

Rahm knows the risks of collapse are rising. He’s passed property tax hikes, emptied the reserves and employed every budget trick he can to make the numbers “better.” He’s even sold off public assets – the city’s future sales tax revenues – to “shore up” the city’s finances, and yet Chicago is still junk rated by Moody’s.

CPS is in even deeper junk territory – far lower than even Detroit. And that’s after the state poured more money in as the result of a new funding formula.

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