Abstract
This study uses the concept of institutional logics and the framing processes emanating from these guiding logics to understand how risk is shifted through public policies. The study concludes that Hacker’s argument that public policies have reconstructed markets to aid the privileged by shifting risk onto the less privileged may have underestimated some of the complexities driving the phenomenon, particularly those stemming from actors having to cope with conflicting logics and ambiguity concerning policy solutions to seemingly intractable challenges. Risk shift does not necessarily involve unilateral transfer of risk from policy makers to risk bearers. Risk shift can emerge out of the complex microinteractions among relevant actors and the framing processes guided by competing logics or belief systems in which the collaborating actors are embedded.
During the past few decades, privatization or individualization of various forms of risk such as health risk, retirement risk, and unemployment risk has become a key feature of neoliberal American economy (Hacker, 2004; Orenstein, 2009). This involves fragmenting and undermining “collective insurance pools that offer reduced cost protection to higher-risk and lower-income citizens in favor of arrangements that leave individuals and families responsible for coping with social risks largely on their own” (Hacker, 2004, p. 249). Hacker’s main thesis on risk shift adopts a top-down lens on the erosion of the welfare state and the shifting of various risks onto individuals. Private employers, driven by the market logic of maximizing profits, have pulled back on employee benefits. Public social programs have eroded under financial and political pressures from the elite. According to Hacker (2004), these changes are imposed on the less privileged, who despite their efforts to make responsible decisions, have become encumbered with an ever-increasing constellation of risks.
In many instances, privatization of risk is accompanied by a discourse on promoting greater ownership or encouraging more responsibility at the individual level. The ultimate risk bearers have limited agency in the risk shift process. This observation stands in reason with public choice theory that assumes individuals are rational self-interested agents seeking to maximize their own utilities (Mueller, 1976). If the individuals to whom risk is being shifted had significant agency in the policy-making process, then as rational actors, they would endeavor to prevent the implementation of such policies. But is this really so? In this article, I investigate a paradoxical case where a public program that shifted risk associated with owning a potentially toxic asset was pushed for and developed in close collaboration with these very victims to whom risk was being shifted. Through this program, the government sold City-owned vacant and abandoned properties in several distressed Chicago neighborhoods to resident homeowners for the token amount of US$1. What appears at first sight to be a redistributive welfare program involved new risks associated with neighborhood revitalization that had previously been under the jurisdiction of the state, and were now being undertaken by the residents. For example, provision of policing and sanitation, which are typically public services provided by the state, had fallen far short of expectations in these communities. By acquiring the vacant and abandoned lots, residents were now responsible for coproducing safety and sanitation by preventing trespassing, removing trash, and landscaping their properties. This policy endeavored to “empower” the poor to substitute the public sector’s role in providing public goods to increase their overall welfare.
The findings from this study indicate that there can be a complementary explanation for risk shift where we account for the very important roles of those at the grassroots level—the roles of those who have been labeled as the victims of the government’s winner-take-all policies in Hacker’s theory. This article argues that the risk shift observed in the American economy is not always unilateral (it can be, but not necessarily). Now, why would those at the grassroots deliberately want to shoulder more risk if this stands against economic rationality? The answer lies in a combination of factors that include the priorities of these individuals embedded in a community logic, political dynamics that shape the interaction between the welfare logic of the state and that of the community, and some amount of historical path dependency involving the government’s chronic inadequacies in addressing the problem at hand. In this case, the risk shift observed at the aggregate level was an emergent phenomenon (see Wilensky, 2001) arising out of complex top-down and bottom-up interactions, not necessarily intended as such by the groups involved in decision making.
This study makes two important contributions—to the theory of collaborative public management and to the economic perspective on risk shift. First, it illuminates the complex interorganizational process involving the genesis, planning, and implementation of a new public program in neighborhoods with low income and high foreclosure rates following the Great Recession. At this point in time, there was severe instability in the housing market that disrupted existing norms, and ushered the need for formulating unorthodox guiding principles to tackle the sudden influx of foreclosed properties in the cities’ inventories. Second, this article seeks to expand our understanding of risk shift by unpacking how the making of decisions that shift risk can be better theorized by accounting for the dynamics of competing institutional logics and subsequent framing processes guided by these conflicting logics in an empirical context where the best course of action is highly uncertain. Motivated by contrasting underlying logics, the relevant actors employed different frames to organize their presentation of the new program to the public.
The insights drawn from the study can allow us to better understand other instances where the bearers of shifted risk inadvertently cooperated with the adoption of the risk shifting policy. For example, with the implementation of the Employee Retirement Income Security Act of 1974 (ERISA), the unions fought to protect the autonomy of gains pertaining to employee benefits previously won under the collective bargaining process. The labor costs associated with the collective bargaining agreements ultimately eroded the power of unions, and allowed risk to be shifted onto employees (see Bales, 1993; Bennett & Kaufman, 2017). As Cappelli (1999) observes, . . . the main arrangements for protecting employees from economic insecurity, such as seniority-based layoffs and promotions, supplemental unemployment insurance and severance pay, and low-levels of contingent jobs, were collective bargaining outcomes initiated by unions that nonunion firms adopted to buy off employee interest in unionization. (p. 149)
In other words, unions unwittingly helped nonunion firms to move employees away from unionization, the consequences of which are apparent in today’s precarious era of the gig economy where a prodigious amount of risk is borne by the workers themselves.
This article is organized as follows. The next section details the theoretical orientation of the study, drawing primarily from the institutional logics and framing literatures. Following that, I describe the empirical context of the case: a land sale program at the nominal price of US$1 in several disadvantaged neighborhoods of Chicago. Then, I elaborate on the data and methods involving interviews and archival records; finally, I present the results and discuss their implications.
Institutional Logics Enacted by Actors Party to Collaborative Arrangements
For the purposes of setting up the theoretical framework for this study, it is first necessary to introduce the definition of institutional logics. The concept of institutional logics refers to the organizing principles that furnish guidelines to actors as to how to behave (Friedland & Alford, 1991), or the higher order belief systems that shape cognition and action (Thornton & Ocasio, 1999). Public organizations such as government agencies generally “enact the institutional logics of democracy and the state” (Knutsen, 2012, p. 998), whereas community stakeholders such as neighborhood organizations are often guided by a community logic of commitment to community values and ideology (see Marquis & Lounsbury, 2007). Institutional logics are an important factor determining the behavior of organizations party to collaborative arrangements (Dormady, 2012). Saz-Carranza and Longo (2012) explored how participants of public–private partnerships manage competing institutional logics. They identified two coping mechanisms to deal with differences in institutional logics when collaborating across sectors: (a) mobilizing legitimacy by communicating with external stakeholders and (b) facilitating partner interaction by providing with joint-learning spaces. However, the authors noted the need to investigate other settings where the competing logics are likely to play out differently, thus requiring alternative management practices (Saz-Carranza & Longo, 2012, p. 349). This study responds to this call by exploring the dynamics of interacting logics in a specific collaborative effort between the City and the community to address the chronic problem of vacant and abandoned properties in the aftermath of the subprime mortgage crisis.
As Meyer and Hammerschmid (2006) noted, institutional logics have “framing capacities” (p. 101), and when actors endeavor to answer the “why” and “how” questions in problematic situations, they draw accounts from existing cognitive schema to label their actions (see Snow, Rochford, Worden, & Benford, 1986). Framing can take different forms: Diagnostic framing is about defining the problem and attributing causality, prognostic framing refers to proposed solutions and remedial courses of action, and motivational framing involves calls “to arms or rationale for engaging in ameliorative or corrective action” (Snow & Benford, 1988, p. 199). A severe crisis, such as the one presented by the deluge of housing foreclosures in low-income neighborhoods following the recession, presents a challenge to existing structures and frames to construct solutions and legitimize the appropriateness of different actions. This may cause collaborating actors—that is, the government and the community—to devise hybrid solutions that differ from the typical expectations of either of the guiding state logic or community logic. The actual vocabularies and accounts employed by the collaborating actors when attempting to mitigate the crisis “show which specific aspects of the competing concepts are picked up by actors, thus manifesting the specific translations of the available logics” (Meyer & Hammerschmid, 2006, p. 103). The accounts used in these frames can involve rationalization and legitimation devices to make sense of situations, plan actions, and to define boundaries for social acceptance.
Legitimation and rationalization as framing devices serve different purposes. Legitimation, which involves production of ideologies, stands for “creating a sense of positive, beneficial, ethical, understandable, necessary, or otherwise acceptable action in a specific setting” (Vaara & Tienari, 2008, p. 986), and can be employed as part of motivational framing. As noted by Rojo and van Dijk (1997), legitimation has a both top-down and bottom-up direction: “the group or institution seeking to legitimate itself through approval from the dominated, and the dominated group legitimating the dominant group or institution through various forms of more or less active agreement, acceptance, compliance, or at least tacit consent” (p. 528). However, although rationalization can also be used to legitimize an action, the former relies on reference to utility or function of specific practices or actions as opposed to ideologies (Vaara, Tienari, & Laurila, 2006). Frames employing rationalization take a more functional approach, focusing on benefits and purposes that can be factualized (Vaara et al., 2006). Different frames involving legitimation and rationalization devices are strategically mobilized by actors to achieve their objectives, which, in our case, are used to justify and render a socially acceptable proposed solution to deal with the chronic vacant and abandoned properties problem.
As evident from the above discussion, the underlying competing institutional logics and subsequent framing processes reconstruct ideas about risk and responsibility, such that the proposed policy solution legitimize shifting the risk associated with owning an abandoned property in a disadvantaged neighborhood from the state to the residents. As public officials use accounts of mutual benefits and welfare, and communities use accounts of government dysfunction and the need to privately mobilize to safeguard one’s family, there is a transformation in perceptions about how much risk and responsibility residents should undertake for rebuilding communities. To expound, in the context where abandoned properties are owned by the City, the risks associated with ownership (such as maintenance, policing, legal responsibilities, etc.) are shared because the City uses revenues from the City’s total pool of taxpayers (not just the residents’ taxes) to provide these services. However, when abandoned properties in distressed neighborhoods are transferred from the cities to the residents, the constellation of risks faced by the individuals increases with redistribution of some amount of risk associated with the revival of distressed neighborhoods from the governments to the residents. By taking ownership of these properties, the residents become responsible as placemakers in charge of renovating, policing, and maintaining these properties. Given that these programs were implemented in low-income communities, the individuals who come into possession of the new properties may not necessarily have the aid of professional placemakers who can provide expert advice to facilitate acts of planning, designing, construction, and maintenance (see Bowman & Pagano, 2010, for a discussion on strategies for transforming vacant spaces). As Schneekloth and Shibley (1995) point out, such expert advice may be vital for overcoming the challenge of revitalizing these spaces because although individuals know many things about the places in which they live, “such knowledge is unstructured, informal and hesitant” (p. 5).
One might argue that if the residents manage to resell these properties, then they will receive a substantial return to their investment. However, in our empirical case, government projections predicted a lack of demand for residential property in the targeted communities for at least the next 10 years. These locales are unattractive for residential use due to absence of good schools or industries, persistence of violent crime, and high unemployment (see Klinenberg, 2015). Unless there is a subsequent effort to mitigate these chronic problems and repopulate the neighborhoods, demand for residential property is unlikely to increase. Examining the relevant frames and the guiding institutional logics underlying the process through which the public program to sell these properties was incubated and implemented, we can gain a better understanding of how social policies have come to cover “a declining portion of the salient risks faced by citizens,” and how many threats are “increasingly faced by families and individuals on their own, rather than by collective intermediaries” (Hacker, 2004, p. 234; also see Hacker, 2008).
Empirical Setting, Data Sources, and Method
Empirical Setting
The empirical setting for this study is the Large Lots Program, adopted and implemented in Chicago in 2014. This program sold City-owned residential lots for US$1 to local homeowners in targeted low-income neighborhoods that suffered the double whammy of long-time depopulation and high rate of foreclosures. Figure C1 of Appendix C graphically depicts the historical decline in population in the targeted communities: Englewood, West Englewood, Woodlawn, Washington Park, New City, and Greater Grand Crossing. Figure C2 shows trends in foreclosure rates in these neighborhoods, which had aggravated the preexisting issue of depopulation. As of March 2014, the City owned more than 4,000 vacant lots in the targeted 13 square mile area, which created a serious problem for tax revenue, maintenance, policing, and prevention of illegal access. The genesis of this program involved informal collaboration among public sector agencies, local nonprofits, and residents of the targeted communities who sought to resolve these issues.
The policy formulation for the Large Lots Program provides an apt empirical context because its targeted areas experienced very little success with prior initiatives to tackle the vacant and abandoned land problem, creating a condition of causal ambiguity where the “right” public solutions were not obvious and proposed remedies were infused with uncertainty. Accordino and Johnson (2000) provide a detailed account of how various cities across the United States such as Detroit, Philadelphia, and Nashville have persistently struggled in dealing with this palpable demoralizing symptom of neighborhood decline. Although uncertainty is central to any organizational life, the subjective meanings that relevant actors give to their decisions and the underlying logics or the belief systems guiding these meanings become important for understanding exactly how risk is shifted through public policies.
Data Sources
This study draws on data from three main sources: (a) media and public discourse on the Large Lots Program; (b) semistructured interviews with individuals involved with the conception, design, and implementation of this program, either in a central or more peripheral capacity; and (c) internal archival documents of the primary organizations involved with the planning and implementation of the Large Lots Program (see Table A1 of Appendix A). The media sources allow us to examine how the program was publicly framed, whereas the interviews and archival data provide insights into the internal negotiations and thought processes of the decision makers that were not a part of the public debate.
I used a combination of selective and snowball sampling for my interviews where I initially approached core individuals in the participating organizations via email, and after meeting with them, asked them for the names of other individuals who were involved with the program. The core members served as brokers between me and the members from other departments/divisions in the organization involved with the program. These members then introduced me to yet others who they thought were centrally or peripherally involved with the program. The length of each interview is between approximately 40 and more than 90 min, depending on whether the individual was involved with more peripheral tasks that had limited influence on planning, design, or implementation, or was a core member of the project. Interviewees were often affiliated with one or more of the organizations involved in planning, adopting, and implementing the program: (a) the City, (b) a regional planning agency that collaborated with the City in coming up with future population projections for the targeted communities, (c) a private civic tech start-up that created the website for the program in collaboration with the leader of a community organization, (d) a boundary organization that acted as a bridge between the City and community organizations, and (e) various community organizations involved with assessing the residents’ interest in the program and liaising between the City and the residents. I tailored my interview questions based on three informal, unstructured interviews that allowed me to gain deeper understanding of the relationship structure and roles that the different organizations were involved with.
Analytical Approach
I organized the data using NVivo that enabled systematic coding, indexing, and recoding of data. I analyzed the text in the transcripts and archival documents, coding at the level of a “text unit,” defined as a sentence or sequence of sentences conveying a coherent point (Weber, 1990). After generating the initial coding categories, I grouped the categories into increasingly nonoverlapping and parsimonious themes. My analysis was based on a process of abductive theorizing, which incorporates the cognitive view of reasoning and is particularly apt for the study of organizations where theorists “make extensive use of nonobservational concepts” (Mantere & Ketokivi, 2013, p. 73). Here, investigators have some initial insight from their data, which they then code, categorize, and gradually work to a higher level of abstraction (see Smets, Jarzabkowski, Burke, & Spee, 2015).
Results
Table A2 provides a summary of two contrasting public frames about the program: One is a motivational frame espoused by political leaders in support of the program, whereas the second is a frame of financial risk and apprehension about the future put forward by residents of the targeted areas. Despite acknowledgment of the risks, the community still advocated adoption of the program. This calls for a closer examination of the underlying belief systems that motivated the crafting of the public accounts. Table A3 illustrates the competing institutional logics of the state and the community guiding these two contrasting frames. Below, I provide a more detailed exposition of the public vocabularies and the underlying mechanisms guiding them.
Motivational Framing: An “Opportunity” for All
In the media, the construction of the discourse on the dollar lot programs in Chicago and elsewhere such as Warren (Michigan) was primarily motivational, focusing attention on the égalisation of access due to the US$1 price. This selective highlighting of the monetary issue invoked the notion that these properties were extremely attractive in terms of simple financial affordability.
Political leaders reinforced this opinion by strategically evoking positive visions of the future. The Alderman of the 27th Ward in Chicago, Walter Burnett Jr., said I think the area they are doing it in—the East Garfield Park area, where we do have quite a bit of vacant lots—I think it’s great because it’ll help to put the lots back on the tax rolls; it gives people some equity in their property before the real estate boom comes back over there. So I think it’s a good thing—it’s a win-win situation for residents in the community and it’s a win-win for the whole City of Chicago. (WBEZ 91.5 Chicago Radio Station, 2014b)
Aldermen in other cities where similar dollar lots programs have been implemented also tended to define these programs as mutually beneficial win-win deals. This communicative work by political leaders intended not only to attract resident homeowners to apply for the program but also to legitimize it more broadly as a viable solution. The discourse in the media primarily evinced the point of view of political elites by emphasizing the negligible cost and amplifying the “win-win” rhetoric of the City representatives. Media portrayals hold significance for mobilizing sentiment pools in a contested terrain where actors guided by different logics offer contesting interpretations of a public program, and tend to influence negotiated meanings by influencing the consciousness of the consumers (Gamson, Croteau, Hoynes, & Sasson, 1992).
Community Framing on Risks
On the other side of the public discourse, the residents had more ambiguous feelings about the program. There were fears about the consequences of such programs, specifically concerning what they mean for residents in terms of potential liabilities. Similar to public expectations of low bids for the more “toxic” assets under the Toxic Assets Relief Program, it was hypothesized that these public lots were priced so low only because they were toxic. One root cause of fear concerned the resources available to individuals for developing these lots, particularly in localities where the median income is less than US$20,000 and homeowners do not necessarily have a lot of discretionary funds available for up-keeping the lots. Another concern was further “cheapening” overall property values in the neighborhoods by selling at token prices. Although the residents were stimulated by the motivational frames employed by political leaders, they were still distrustful of the government.
Mechanisms Underlying the Two Contrasting Frames
The above public frames emerged out of complex interactions among groups of individuals primarily guided by two different belief systems: (a) the actors in the City closely identifying with the logic of the state and (b) the community organizations and local residents strongly identifying with the logic of the community (see Table A3). The process leading up the adoption and implementation of the program can be modeled as comprising of five different stages on the temporal continuum: (a) stimulus, (b) mobilization, (c) issue identification (diagnostic framing), (d) brainstorming solutions (prognostic framing), and subsequently (e) negotiations facilitated by the mechanisms of (a) legitimation and (b) rationalization by the involved individuals who followed the logics they closely identified with (Table A4). The role of community organizations was particularly important for enabling cooperation between the residents and the representatives of the City because negative historical experiences had compromised mutual trust: I was somewhat concerned because as a native resident of one of the communities that’s impacted, I know the community—a great number of residents in the community—will kind of look askance when an initiative is being brought to them, particularly long-time residents, we are talking (about) residents who have been in the community maybe 25 or more years—most definitely residents who have been in the community from the times of urban renewal. For some, there could easily be some suspicion because there has been some historic disinvestment in some of the neighborhoods that would be a part of this program and there might be some tacit suspicion about how this is going to impact me as a resident. I could sense that might be something and there might be some concern on how the method in which the City approach the neighborhood—how would this information be disseminated—would it be disseminated in a wide network of methods of communicating or was it going to be restricted to the Aldermen’s offices or certain community-based organizations that all the residents may or may not be familiar with. So, you know, I could see the residents could respond in different ways to it. (Interview 7 with resident)
Although it is difficult to get a sense of the reach of these community organizations in terms of geography (e.g., some organizations are more active in specific parts of these communities), it is safe to say that there would have been a lower involvement on part of the residents in the absence of these organizations. More important, community organizations facilitated bridging activities (see White, 1999) such as workshops and surveys by the City to connect and negotiate with the residents, so as to establish a dialectical relationship that helped in modifying the program into a form that was mutually acceptable.
The City and the community worked together to identify issues to put on the table, although they did not necessarily agree on their relative importance and implications. The City, for example, communicated that according to the projections of the planning agency, the neighborhood would grow only marginally (Exhibit B1, Appendix B) by 2040 and, thus, they should plan for permanently smaller communities by reusing existing housing units. These quantitative projections were meant to represent a scientific rationale for the City’s central problem on how to effectively plan for permanently small communities (e.g., how many people they should plan for? What would the neighborhood look like with fewer residents? Should fewer residents mean that current residents should increase the size of their parcels? These were some of the City’s concerns).
However, the community members were disgruntled because they would have liked these numbers to be based on a dynamic vision for interventions and change. The residents focused on the problems here and now in the present, such as the challenges in the Adjacent Neighbors Land Acquisition Program (ANLAP). The City listened and found that this aligned well with their issue of increasing parcel sizes to plan for smaller communities: . . . We went to the field and we talked to people. Like an older woman—she won an ANLAP lot and she wanted the next one, but she couldn’t because the rules didn’t allow her to. We ran into people—not a whole bunch—who were like “I want more through ANLAP, but I can’t. The rules were too restrictive.” Well, why? That’s silly. I can understand in certain communities we don’t have a lot of land, but why restrict it if these people want to take these lands? (Interview 12 with public official)
Such initiatives to solicit feedback and closely interact with the community highlights the City’s attempts to “bridge the frame” (see White, 1999), and persuade individuals who are similarly affected by the vacant and abandoned properties problem to participate in the initiative. Having found common ground for cooperation, the parties moved on to prognostic framing.
The community and the City proposed various solutions that were intimately debated. The initial push for what was at that time referred to as “Expanded ANLAP”—and would later come to be known as the Large Lots Program—came from the community members. If certain ideas received strong pushback or were deemed illegitimate, the actors went back to the drawing board. One of interviewers explained: I had some ambivalence about it (the Large Lots Program) . . . I felt we were tossing in the towel saying, “we give up.” We can’t think of any other thing to do here, therefore we’ll let you buy it. Also, with the real estate bust, people were looking all over the place to buy real estate. My fear was that if the area ever turned a corner . . . suppose the housing thing turned around, this guy (the private owner) could hold the whole block hostage . . . that was my fear. My fear was that if you did this (the Large Lots Program) for the whole of South Side, it could stunt growth . . . Cities grow due to immigration . . . you can attract those people (the immigrant population) into these neighborhoods and flourish that way. Well, there’s a problem with that in Chicago. Politically, it’s not correct. (Interview 3)
Sometimes, ideas that might receive political pushback, such as attracting nonresidents to the targeted neighborhoods using publicly owned land, were quickly taken off the table without significant negotiations. The dual processes of legitimation and rationalization, described below, guided the negotiations stage:
Legitimation: Bottom-up and top-down processes
In the bottom-up legitimation process, resident owners who actively participated in the workshops and public meetings prior to the implementation of the program framed themselves as deserving recipients of the US$1 value by delegitimizing the offending “neighbor”—in this case the City. They posited that the City was not doing its due diligence in the upkeep of these properties and that the residents had to often take over the “unfair” burden of fencing, mowing, and discouraging trespassers on these lots. By being a “bad neighbor,” the City had compromised the safety of the residents. The latter evoked the competing logic of the market juxtaposed against the logic of the state and the logic of the community, as exemplified below: So the City lots were never part of the traditional market . . . but I think they were dragging down property values, they were just staying vacant. The City is not your traditional property owner. The only reason the City has all these lots is because of the downturn . . . what I think it (the Large Lot Program) signals is that the City is interested in the development of Englewood. That’s what it signals. If anybody’s reading the dollar lots as the market value of the lots—that they’re worth a dollar—they’re misreading it. And I’m not sure what the market’s going to do, but I think that will be a misreading of the market. The land at 63rd Halsted is going to be transferred to a developer without consideration—nobody thinks that the land is worthless—it just accelerates the development of the neighborhood . . . That was a City-owned lot. It will be transferred to a private investor for free. Nobody is saying it will bring down the property value . . . I hope that the market doesn’t read it as “oh, this land is worthless”; what the market ought to read is that the City is invested in finding new and innovative ways to empower investors and property owners to develop the neighborhood. I think that’s what it signals. The second thing is these lots. I mean, I was talking to (name of City official). One of these lots the City has owned since the 1916. 1916! That’s every market slump you could write about—up and down—that’s everything. So, these properties were not moving. A vast majority . . . 60 percent of the applications from the Englewood pilot were from people had applied to buy the same lots through the ANLAP program. There was demand for these lots. The City policy was not meeting this demand. This program met that demand. So, the dollar is just a formality. The City is not in the business of selling real estate, they are in the business of governing the City. And it’s not the best property owner. If they could do it for free, they would do it for free . . . What it does is add tax revenues to the tax bills, and it gets the City out of the business of owning property, which it does not do well at all. These lots are not part of the traditional market at all. (Interview 9 with community leader)
Such bottom-up legitimation processes highlighted what the community members thought the program meant for them and how it brought value to their community. For residents, the US$1 value of the lots offered to homeowners was a legitimate price, not because of the absence of a private market that precludes the sale of these lots at a higher price, but because this program represented a way of righting the historical wrong done to the community’s long-time residents by the City. This highlights the need to go beyond the standard assumption that prices are determined by supply and demand under conditions of perfect markets, and understand the social and political origins of price (see Beckert, 2011).
The top-down legitimation process was based on data-driven projections of the future and what would be the “best plan” for the community based on those projections: We knew that the real estate market wasn’t going to be strong in the next 5, 10, 15 years, and we were like “wow, this is not gonna come back for a very long time” . . . then, they (the communities) were not even close to a big job center—although Woodlawn . . . if anybody does well it will be Woodlawn because it’s so close to the University of Chicago. But Englewood is out in the middle of nowhere when you look at the geography . . . well, it has an El line running through it, but it’s really been dismantled so badly that it’s in bad shape . . . So that (the Large Lots) was more of a residential approach . . . people living on those blocks—who have stayed there over time and invested—‘twas to give ‘em something . . . you know they could take care of the lots, keep the loitering off the lots, they could keep the lots clean, eyes on the lot, probably keep down the crime rate more or less . . . yes, it was about putting these back on the tax rolls, but that was way down the list; it was more or less about giving people a stake in the community . . . and improve their overall quality of life . . . In many of these neighborhoods, people are on fixed incomes; you don’t have young urban professionals and pioneers moving into these neighborhoods; these are people who are working class—many of them are retired and have Social Security. The minute you purchase these lots—and we thought about this very carefully—the minute you purchase this lot—and this lot, and that lot—your taxes go from here (points down) to here (points up). So, in fact, you are putting them in the face of trouble. That was something we discussed for a long time. We don’t want people to purchase and end up losing everything—that’s not the whole purpose of the thing . . . the purpose is to increase the quality of life . . . (Interview 3 with public official)
From the above excerpt, we observe how the competing pressures of the market (low demand) and the welfare logic of the state (reducing crime rate) within the City led the birth of a hybrid solution that embodied risk shift. The actors, though, were clearly not driven by the market logic, and most closely identified with the welfare logic of the state. Restrictions such as a maximum limit of two lots per deed were specifically built into the program in keeping with the welfare logic of the state. The City was afraid that without this restriction, residents could fall prey to unwise choices by taking on more risk than they could afford.
However, top-down legitimation was more contested due to several challenging questions: (a) Which residential-zoned vacant properties within the targeted communities were deserving of the US$1 value (concerns included whether there should be a size limit or a consideration for very well-located properties likely to fetch higher prices in the market)? (b) Who were deserving recipients of the US$1 value (should the program be opened to nonowners to promote gentrification, should churches who owned land on the same block be eligible, should residency be a requirement along with ownership, how would the legitimate recipient be determined whether there are multiple applications for the same lot)? (c) What level of proximity between the owner and vacant lot would legitimate the offer price of US$1 (how should a block be defined, are vacant lots across the street close enough for the owner to oversee their upkeep)? These questions were identified as issues and were put back on the table for collaborators to brainstorm solutions and renegotiate (this is captured in the loop in the process model as demonstrated in Figure C3, Appendix C).
b. Rationalization: Top-down and bottom-up processes
A second process that took place concurrently with legitimation during negotiations was rationalization. The top-down rationalization process involved actors using prognostic frames to rationalize the program internally and externally. Externally, the planners argued that this was a means of empowering the local land owners by endowing them with both equity and a sense of ownership where they would feel motivated to improve the vacant land. It could bring “life back” to the community by creating new prospects for these lots, and the City could simultaneously gain trust by highlighting that it was a “bad neighbor no longer.”
Internally, however, the planners had to justify giving away the bureaucratically so-called “line items on the assets side of the balance sheet” for no more than a pittance. The planners used projections by the regional planning agency to focus on the estimates, which indicated by 2040, the population in these communities would grow very marginally (about 4%) and, therefore, there would be no market in the near future. This implied that hoarding the lots and, consequently, facing diminution in tax revenues was not “economically sensible” (see Exhibit B1 in Appendix B).
The bottom-up process of rationalization by residents centered on two main lines of reasoning. Acquiring the properties could contribute to a greater sense of security and allow them to implement any ideas they had for the land legally (for instance, create a fenced safe space for children to play). The vacant lots were, as described by an interviewee, “a security risk.” Jackie Moodie, a local resident, recalled, One time, I was out here, and my great-grandchildren, who I keep an eye on, disappeared into the high grass in that yard, and I couldn’t see them. I didn’t even know they were in there. That really, really scared me. You don’t know what’s in there. (Olivo, Mullen, & Glanton, 2011)
The benefits from increased perception of family safety could offset the risks associated with acquiring the land. Esthetics constituted a second important benefit. Many of these lots were often littered with trash and, as residents put it, “an eyesore.” The grass on the lots could grow several feet before the City came in to clean them. The residents rationalized that they could live in a more esthetically pleasing environment if they did not have to wait on the City to take care of these “eyesores.” According to the sale records of the City of Chicago, approximately 54% of the purchased lots in the Greater Englewood pilot program were adjacent to the properties of the homeowners. This alleviated the costs of taking care of the newly acquired property, and increased the potential rewards of perceived safety, improved esthetics, and personal legal control over formerly publicly owned spaces. A majority of the homeowners who applied for these lots were not concerned about the resale value of these properties as they had to hold on to them for at least 5 years before such decisions could be made. A survey by Stewart, Gobster, van Riper, and Williams (2017) that collected responses from 197 owners in East Garfield Park, Englewood, and Woodlawn in Summer 2016 found that 33% of the respondents indicated the use of their lots as an investment for future resale as “very important” or “extremely important,” and 92% indicated keeping the lot neat and clean as “very important” or “extremely important.” Because demand for new housing has been low in these neighborhoods for the past several years, most applicants did not plan on immediately constructing houses on their lots. City of Chicago’s applicant records and reports from focus groups held by U.S. Forestry Service found that most buyers intended to use the lots to beautify their blocks, develop as neighborhood resource such as a community garden, grow local foods, and as a means to reaffirm their identity by not moving away from their ancestral homes and helping to make their heritage better (Stewart et al., 2017).
Postimplementation
After acquiring the lots, residents have taken up the responsibility of ensuring public order. An ongoing study conducted by the U.S. Forest Service that uses reports from focus groups and time-sensitive Google Earth snapshots on 424 lots sold through the program found that about 40% of large lot owners made changes in the first season that involved “cleaning-up trash and refuse, installing fences, infill of subsidence, hardscape removal, turf improvements, planting (flowers, vegetables, trees, and shrubs), putting-up signage, ornamentation, development of social/recreational facilities, and vehicle storage or parking,” resulting in 8% decline in turf noncompliant properties compared with the period prior to implementation of the program (Stewart et al., 2017). Their initial results also indicate that about 50% of the lots are being actively managed and approximately 18% actively gardened, with higher levels of care extended to those lots that were more proximal to the buyers’ original property. Although very preliminary, Stewart et al. (2017) also found decline in undesirable acts such as dumping, public urination, and drug activity (also see Dellimore, 2016). Interviews with some of the buyers indicate perceptions of increased safety relative to the time before they acquired the lot, particularly for those who purchased the property adjacent to their own. At this point, most buyers are envisioning how their improvements could bring value to the community, although much of the actual work remains to be done. Many buyers do feel an impetus to “do their bit” to bring life to the community, but this could also be a result of self-selection as those interested in community revitalization and possessing greater neighborhood attachment were more likely to apply to the program in the first place. Of course, long-term results may be different from short-term outcomes. Regardless of the impact, from the initial 13-mile radius, the program was later expanded to 30 other low-income communities across Chicago, focusing on the South and West sides such as Austin, Chatham, Fuller Park, South Chicago, and so forth. Overall, beginning with the pilot in 2014, the program has become legitimized as a partial “solution” to combating the vacant and abandoned properties epidemic.
Discussion and Conclusion
The results discussed in the section above suggest that neither were the resident homeowners unaware of the risks associated with privatization of City-owned vacant land in disadvantaged neighborhoods nor was the City unilaterally attempting to shift responsibilities associated with community revitalization. The community was guided by the motivation of being able to improve safety for their families, live in a more esthetically pleasing environment, and/or simply take legal ownership of something they had already informally taken charge of. The City, facing the competing pressures of the market (cost efficiency) and the state (welfare), still committed itself to improving the quality the life of the residents vis-à-vis trying to “efficiently” get as many lots as possible back on the tax rolls. However, scaling up the program over the next 2 years to more than 30 communities without waiting for postimplementation results from the initial pilots is indicative of the pressure faced by the City with respect to management of these properties.
The decline of the developmental role of the state and the shift of risk associated with community revitalization to residents are emergent outcomes of a hybrid solution that resulted from frames guided by competing belief systems, and negotiations facilitated by top-down and bottom-up legitimation and rationalization processes. Neither was the City trying to shift risk in an agentic homo economicus sense nor were the community members seeking to take on additional risks, but their collective negotiations in the face of a serious crisis resulted in the emergence of a hybrid solution that gives the appearance of doing so. In communities such as Englewood that are characterized by high crime, severe poverty, unemployment, and depopulation, by assuming ownership of additional properties, residents are taking on the risk of owning a potentially toxic asset. They are also taking on some responsibility for policing and clean-up that would otherwise have been part of the public services obligation of the City. However, at the same time, this risk provides new opportunities for neighborhood revitalization. Greater community control over previously City-owned land can lead to empowerment and a collective consciousness to proactively contribute to positive change. Stewart et al.’s (2017) preliminary data from focus groups do find indications of increased social interactions among residents following implementation of the program, which can build neighborhood cohesion and help to control undesirable street activities. Given that these neighborhoods are structurally disadvantaged with lower levels of social control (Silver & Miller, 2004) and lack effective institutions to foster mainstream values (Krivo & Peterson, 1996), more resources are needed to initiate sustainable change. Two years after the implementation of the program, the housing market in these neighborhoods remains cold. Following this trend of lacking demand, residents may have to invest 5 years in paying taxes and maintaining the lots without being able to sell them in the future. If the City decides to invest in the development of these communities by promoting more community-building activities, attracting businesses and reversing the trend in depopulation, then these assets also hold the potential to contribute more positively to the net worth of the owners.
The rhetoric of more personal control and empowerment is often touted as a virtue of risk shifting policies, and is a double-edged benefit that disguises the correlative vice of relocating responsibility (Juengst, Flatt, & Settersten, 2012). This is evident from the long-term consequences of ERISA (see Keville, 1994), which eroded the once taken-for-granted norms of guaranteed pension plans, and pushed the financial responsibility of managing retirement onto employees. Defined contribution plans took the decision making out of the hands of employers and put it into the hands of workers. Today, failing to save adequately for retirement is often equated to personal failure and lack of foresight. Another example is the growing trend of personalized genomic medicine, which was developed in close collaboration among physicians, patients, and advocacy groups. Patient empowerment and supporting the patient’s voice in clinical encounters are central features of personalized medicine, but these aspects also push the responsibility for important health care decisions onto the individual patient who may only be a “lay expert” (Juengst et al., 2012). In the instance of the Large Lots Program, the consequences of such a shift in responsibility are more acute because the risk bearers are a socially and economically disadvantaged group.
Programs similar to the Large Lots have been implemented in other destabilized neighborhoods across the country. Large Lots itself was modeled off a similar program in Detroit, Michigan. Although the overarching strategy of “empowering” communities to “take up the shovels” for their own neighborhood revitalization is similar across various cases, the specific features of these programs display variance due to different political dynamics, cultural needs, and historical heritage. In sum, although the strategy itself has diffused, there is an absence of isomorphism in terms of imitating an “exemplar” program. For example, in Pennsylvania, homeowners with vacant lots adjacent to their property can purchase those properties for US$1 from Philadelphia Redevelopment Authority’s “Front Door” online sale program if the property is valued at less than US$15,000, shares a border with the owned property, and is less than 3,000 sq ft., though closing costs can amount to as much as US$1,000. In March 2014, State Representative Wesley Bishop sponsored two bills that would allow the city of New Orleans to sell abandoned land in the hurricane-ravaged Lower 9th Ward to private buyers for US$100 each. These endeavors at neighborhood stabilization followed in the footsteps of other discounted property programs such as City of Gary’s Dollar Home Program in Indiana, and are testament to the increasing trend of “empowering residents” to revitalize their own neighborhoods.
In implementing these programs, the government needs to remain vigilant about the fact that the rhetoric of empowerment often differs from the reality of development, particularly when the associated risk is shifted to a marginalized or disadvantaged group. Although the long-term results of the Large Lots Program are yet to come to fruition and short-term indicators show some positive trends, the divergence between rhetoric of empowering the vulnerable and actuality is starkly evident in other relevant sociopolitical contexts such as microfinance. Isserles (2003) discusses how microcredit reinforces a narrow view of poverty in the name of empowering poor women, and “makes individual behavior central to overcoming poverty, avoiding structural analyses or critiques” (p. 45). In reality, the gendered context of the locales where microcredit programs are implemented is such that women are more easily coerced and pressured by loan officers (Isserles, 2003). Similarly, in the context of self-care decisions by people with diabetes, Paterson (2001) found that “even when active participation of people with chronic illness is promoted by practitioners, the outcome can be a delegitimization of a patient’s ability to participate as an active partner in decisions about care” (p. 574). Channeling adequate resources to enable informed decision making and sustain the momentum of change, and keeping in perspective the cultural and sociopolitical peculiarities of the targeted communities are needed to translate the rhetoric of empowerment into a reality.
Finally, it is also necessary to recognize several limitations of this study. First, it explores only one specific public program and is not necessarily generalizable to other contexts. The interactions between logics can play out differently in another empirical setting. Second, it is necessary to unpack the dynamics of emergence in a more fine-grained manner to answer questions such as the relative importance of the intermediate processes in the emergent phenomenon of risk shift. Because I do not have data from participant observation, I am unable to fully unpack the relative importance of these processes in emergence. Future studies should seek to investigate these elements in more depth.
Footnotes
Appendix A
Stages of the Large Lots Program.
| Program stage | Characteristics |
|---|---|
| Stimulus | • Exogenous shock: increasing severity of the vacant and abandoned properties crisis • New funding: grant for the Department of Housing and Economic Development (HED) and the Local Initiatives Support Corporation (LISC/Chicago) through the Chicago Metropolitan Agency for Planning’s Local Technical Assistance Program to create a Green Healthy Neighborhood (GHN) Land Use Plan for Greater Englewood, Woodlawn, and Washington Park. |
| Mobilization | • Coordination and communication efforts between the City and residents: • Meetings and outreach events between 2011 and 2014 before the first pilot was implemented. • Collection and aggregation of feedback from attendees in the form of minutes, comment cards, and so forth |
| Issue identification (diagnostic framing) | • City: planning for the future by managing space to accommodate smaller communities • Community: addressing present problems of crime and neighborhood deterioration through intervention |
| Brainstorming solutions (prognostic framing) | • Ideas that may be politically incorrect but provide long-term benefits vis-à-vis political correctness of stop-gap remedies |
| Negotiations | • Contested proposals (such as whether churches should be included as eligible applicants) • Use of discretion |
| Postimplementation | • Expansion to other neighborhoods • Settlement of purchase claims • Residents now responsible for care of lots • Initial observations of decline in undesirable activities and increased perceptions of safety |
Appendix B
Appendix C
Declaration of Conflicting Interests
The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author(s) received no financial support for the research, authorship, and/or publication of this article.