Does Chicago Need a Marshall Plan?

  • August 1, 2014
  • Forward

    Making Space for Opportunity

    In a recent opinion piece in Crain’s Chicago Business (July 21, 2014), James Reynolds Jr. of Loop Capital Holdings LLC laid out an argument in support of a Marshall Plan as a long term solution to Chicago’s very real and immediate issue with violence, especially in poor, minority communities of color. Coupled with the accompanying editorial that also supported an economic answer, they made a compelling case.

    Essentially, both argued that we must be able to move from a social service mindset which provides supports that are necessary but insufficient to prevent further worsening and escalation of violence and other social ills in communities of concentrated poverty to an economic development mindset. We must make economic development real in these communities. Without opportunities for employment and income, desperate young people with little preparation and poor education have few options but to turn to gangs for survival.


    “The cost of keeping the West and South sides poor
    far exceeds the cost of making necessary investments
    in a Marshall Plan development approach.”


    West and South Sides Inclusive Economic Plan

    The idea of creating a Marshall Plan for Chicago involves creating an economic development plan for the City that includes its West and South sides. Of necessity, it will also include making significant investment in the economic development of the communities on the West and South sides. We must create opportunity and real jobs. It is not enough to have a few businesses locate one or two retail stores in Englewood or Pullman. We need the economic engine of Chicago firing on all cylinders and helping businesses – small, medium and large – to locate where a large workforce exists and to be part of the economic rebuilding of Chicago. We also need to create opportunities and access to capital for new businesses to sprout up and grow in these communities. Given the segregation of the City, the extreme contrast between the West and South sides and other areas of the City, and the failure of social safety nets to advance these communities out of concentrated poverty, creating and executing on a Marshall Plan will take all of us – Chicago’s business community, federal, state and local governments, the nonprofit sector, and the communities themselves – working collectively, to succeed.

    Financially Sound and Socially Responsible

    The scale of the challenge is enormous. On the West Side alone, at least 63,000 people will need to be employed in skilled jobs making far more than the minimum wage touted by the Governor and the Mayor, to move the community out of concentrated poverty. As many as 90,000 jobs will need to be created just to build sufficient economic stimulus and growth. The economic cost of doing this is actually relatively modest, likely much less than 100 billion dollars, while the economic and social cost of not doing it is far, far greater. A recent study suggested that it costs tax payers around $57,000/year for every homeless person in NYC. Cost estimates in Chicago must be reasonably comparable. If you add up the cost of emergency medical care, emergency services, policing, incarceration, social services, etc., the cost of keeping the West and South sides poor far exceeds the cost of making necessary investments in a Marshall Plan economic development approach. The cost of a Marshall Plan is front loaded. Once economic development takes hold, the costs decrease substantially and, eventually, go away. The cost of not doing anything, however, is perpetual – year after year after year with no end in sight. A start-up investment, even a substantial investment, is clearly preferable to ongoing violence, community decay and cost escalation.

    Who is going to pay for such a plan? The same people who are paying for the lack of an economic development plan now: us.

    For more information about economic development on Chicago’s West Side, visit

    West Side Forward>