Wealth, Power, and Addiction

I live and work in downtown Iowa City. I regularly walk through and spend time in the downtown area. Having lived here (with a few years spent elsewhere) since the 1980s, I’m always trying to get perspective about this city and where it is heading.

As I was meandering to work today, I went through the pedestrian mall and my mind was naturally drawn to the numerous bars. I’ve had a theory for a while about what drove out so many of the stores I used to like, the stores that the average person would want to shop at and could afford to shop at. There is a general gentrification going on that is being promoted and funded by TIFs (among I’m sure other causes), but there is more than just that going on. I’ve considered that maybe the bars have been so profitable that they’ve driven up the rental costs in the downtown, driven them too high for the average small business owner.

This is problematic. Few things can compete with alcohol. All that has been able to compete are mostly high end restaraunts, art galleries, gift shops, jewelry stores, etc.

I was thinking about what this means. Why is it that it is so hard to compete with bars? The first thing that came to mind is that alcohol is an addictive substance. For a large number of people, the more alcohol they drink the more they want to drink. It guarantees repeat customers who are willing to pay high costs for their preferred drug. There is a reason the only mom and pop grocery story left in town is a major retailer of alcohol, and of course it is downtown.

I’m not for prohibition of addictive substances. But we have to get serious about the externalized costs, whether from legal or illegal markets. I’m in favor of making most addictive substances legal, but putting high sin taxes on them and providing the highest quality rehab centers (along with whatever else is beneficial). The sin taxes should go to deal with all the externalized costs, from rehab centers to homeless shelters… also to deal with the problems developing in the downtown and other impacted areas.

There is something telling about how gentrification and the sale of addictive substances act as twin forces in utterly transforming this town. I’m far from convinced that these changes are positive.

* * * *

What is the relationship between gentrification, crony capitalism, and bars? Or to put it another way: What is the relationship between wealth, power, and addiction?

I wouldn’t be the first person to associate addiction with the consumerism of a capitalist society. Nor would I be the first to associate addiction to power relationships. I know William S. Burroughts had many interesting thoughts on the matter. Is it simply about social control? If so, to what end? Or is it as Burroughs suggests, just power serving power, like a disease?

I’m specifically thinking of the city I live in, but all of this applies more broadly. Also, the issue of alchol should be widened to all addictions and everything related to it: drug wars, mass incarceration, etc. Part of my context here is the book “Chasing the Scream” by Johann Hari. That author sees addiction as a social failure, rather than a mere personal issue. It isnt just the addict who is addicted, but the entire society addicted to the system. The alcoholic is addicted to alcohol, the bar owners are addicted to the profit they can make, and the local government is addicted to the tax money that is brought in.

The difference with alcohol, though is that it is a socially acceptable addiction. The entire identity of a small college town like Iowa City is tied up with alcoholism. The UI is famous for being a party school. The town was well known as a drinking town going back for more than a century. Generations of people have traveled from far away just to get drunk in this town.

What is at the heart of this? What is the driving force behind it all?

* * * *

I originally posted these thoughts on Facebook.

It was on my mind for some reason. Several people commented and it led to a detailed discussion, but my mind was no more clear afterwards. I still don’t quite know what to make of this line of thought.

It’s complicated, as I’m always repeating. There is a much larger context involved (German immigration, Prohibition, TIFs, etc). No changes come out of nowhere. There are always underlying causes that go much deeper, often to historical roots.

Here are a few other things I’ve written before about related issues. Also, along with them, I’ll throw in some articles about the local area.












Click to access Tax_Increment_Financing_A_Case_Study_of_Johnson_County.pdf









TIFs, Gentrification, and Plutocracy

The most recent issue of my local alternative publication, Little Village, had two articles that caught my attention (Vol. 17, Issue 162, Sept. 17-30 20014). Taken together, they made an important point. I suspect that wasn’t an accident for they were printed close together as the first two articles presented.

The first article is, “The Truth About TIFs”. It is written by Matthew Byrd.

Like many other places, TIFs have been a big issue around here, as they should be since TIF funding comes from the money taken from the taxpaying public.  Here is how it has played out in this local area. A neighboring town, Coralville, has used TIFs to draw businesses away from the town I live in, Iowa City. A TIF has been used for the the large mall built in Coralville which had major impact on Iowa City’s downtown. Iowa Citians like to call it the Death Star. We used to have a nice downtown that had normal stores, but now it is filled with mostly bars, restaurants, art galleries, and expensive gift shops. The TIF-funded mall played a role in gentrifying Iowa City.

That said, Iowa City’s government has embraced this gentrification with its own TIFs. A highrise was built in downtown Iowa City using a TIF. It is a big fancy building that will add yet more expensive apartments to downtown and with room for yet one more expensive shop on the ground floor. In building this highrise, the city got rid of the benches in front of this new highrise. The area where those benches were used to be called the “People’s Park” and it was an important public space that has now been made into the front yard for the wealthy inhabitants of the highrise.

This wasn’t the original intent for TIF funding.

As the article explains, “the image of TIFs is considerably less rosy in execution than it appears in conception, particularly when it comes to the intellectual core of TIF law: the focus on blighted neighborhoods. T?he idea that TIF funds are supposed to be used to revitalize poor neighborhoods is paramount, to the point that it’s written into Iowa State Code. As the Iowa Department of Revenue explains, “Iowa code recognizes two primary purposes for [TIF funding]; namely, to eliminate slum or blight and to promote economic development.””

TIFs help blightned neighborhoods about as much as the war on poverty helped the poor. In the end, public money always seems to get redirected to the already well off. The poor get underfunded schools, unemployment, and mass incarceration while the rich get privatized education, outsourcing, and government contracts to build and operate the prisons. One of the purposes of TIFs was to create and maintain low-cost housing in neighborhoods where investors wouldn’t otherwise build or renovate.

This brings me to the article immediately following the above one, “High Rises and Higher Rents”. This article is by Shauna McKnight.

Basically, there is too little housing for too many people. Also, the housing available is simply too expensive. The article begins by pointing out that “[a]pproximately 30%” of Iowa City’s population lives below the poverty line, “compared to Iowa’s average of 12%”. On top of that, “55.6% of renters in Jonson Country are cost burdened” which is “the highest rate in all of Iowa”.

Affordable housing isn’t keeping up with the demand of population growth, specifically an increasingly impoverished population because of the recession and other factors: “the vacancy rate in Iowa City sits at half of one percent. In a normal, healthy market there is typically a five percent vacancy rate.” As the article continues a bit further on, “the problem is that the wages in the area haven’t kept up with the cost of living.” This forces many poor working class people to look for housing further away in the nearby rural areas and small towns. Cheaper housing just means more expensive travel costs. Also, where someone lives determines their opportunities such as the school their children will attend.

Many people can’t win for losing. This isn’t limited to Iowa City, that is for sure. Still, rural farming states like Iowa are being hit harder than the states in other regions. This is why the younger generation is fleeing which creates a death spiral for the local working class communities. A particularly disheartening piece of data is how, “one in five working families in Iowa have incomes that cannot meet their basic needs. This can lead to a cycle of poverty that persists across generations.”

This is where the TIF issue comes in. Why is the local government giving money to promote the building of housing and shopping for the wealthy?

“The issue of affordable housing has thrown a spotlight on The Chauncey building—which will hold both commercial spaces for area business and luxury housing units. The city plans to pay &1 million to set aside five units of affordable housing in the complex (the remaining units will be luxury condos and apartments).”

That is the official solution for the housing problem, really? We the public will pay a million dollars to get five more units of affordable housing in this town. We are being fleeced. I sometimes feel like this town has been taken over. If the local government isn’t serving most of the local population, then who is it serving?

Iowa City Gentrification

Being a longtime resident of a place allows one perspective on change. But it can make one feel like an old curmudgeon reminiscing about the way things used to be.

Fortunately, I’m not a curmudgeon by nature, for the most part. I don’t mind the basic changes of life. In my mind’s eye, I see a field where my parents neighborhood now stands, I see a parking ramp where an empty lot once was, and I see even larger new buildings in place of smaller older buildings. Some changes seem less desirable, but others seem quite lovely. I’m generally for progress on principle. Certainly, I appreciate the new park built on the south side of Iowa City and the wondrous multi-use trails that have made non-vehicular travel easier and more pleasant.

Curmudgeon, I am not. I have my memories. Heck, with my study of local history, I even have ‘memories’ of what existed before I was born. I can see in my minds eye the fountain that existed before my time at the intersection of Iowa Avenue and Dubuque Street. All the past blends together, although I have a harder time envisioning in my head the Sauk villages that were along the Iowa River at the southern edge of town. The weight of the past isn’t a negative. The past passes, but it leaves its residue and shapes the present.

However, to be curmudgeonly for a moment, let me voice my complaints about what is becoming of this place of which I’m so fond. Well, not necessarily complaints, more just wonderings about what it means and where it is all headed.

When I was a kid in Iowa City during the 1980s, I experienced a downtown that had earlier been renovated to the extreme. The town has gone through very distinct phases. It began as a frontier settlement and I suppose a trading town with the Native American trail that passed by though what is now Hickory Hill Park. Then it became the first state capital of Iowa, but it turned out the river wasn’t navigable by steamboats. Eventually, it became a college town which it still is. At some point, tough times must have hit the economy because the downtown turned into a stark area with many empty lots and the respectable citizens were wary of venturing there. Then back in the 1970s, a ton of government money was dumped into a project to make the downtown attractive again. It was successful and we now have a great pedestrian mall which is a popular destination.

That set in motion changes that weren’t predictable. The downtown was maybe less respectable at an earlier time, but it was also a more affordable place. Almost anyone could open a store and sell whatever they wanted. Stores came and go, but the entrepreneurial spirit kept the place an active downtown. Maybe there weren’t as many stores for the upper classes, but that meant there were more stores directed to us common folk.

I see the downtown becoming gentrified with high rises popping up here and there and the downtown I knew slowly disappearing. I used to be able to do my entire Christmas shopping downtown and it was affordable. Now, my upper class parents don’t even shop downtown because it has become too expensive. If the downtown isn’t affordable for the upper middle class, then that is a sign that gentrification is in full gear.

Maybe all that gentrification began with that earlier downtown renovation or at least the seeds for it were planted. But I’m not sure this gentrification was inevitable. I suspect it was created because that is what some of those in power want. The question I ask is: Why do they want this?

All I can think of is that, along with being a major university town, this is also a major medical and research center because of the university. Iowa City has the second highest number of doctors per capita in the United States. On top of that, the University of Iowa has been attracting an increasing number of foreign students and I suspect a disproportionate number of them are wealthier than the native-born students. So, we have our share of wealthy people, many originally from places like Chicago or the big cities on the coasts or else from big cities in entirely other countries. The point being is that these people aren’t Iowa farmers and factory workers nor their children. They aren’t the local working class and they aren’t poor college students, especially not living in those expensive downtown high rises. It seems to me that downtown Iowa City is being designed to be attractive to these outsiders and not being designed to serve the interests and purposes of the average local.

I understand the desire to make one’s town attractive, especially attractive to those with lots of money. But this prostituting of one’s town is a sad fate. Like all class warfare, it is rarely the lower classes who win. Everyone but the wealthy will be driven out of the downtown and the heart of the community will begin to die. The repurcussions won’t be obvious right away, but give it some decades and the town will become even less recognizable. Maybe I’ll be converted to old curmudgeon before long.