how finance capital and money markets work, including in relation to urbanization.
As in all the preceding phases, this most recent radical expansion of the urban process has brought with it incredible transformations in lifestyles. Quality of urban life has become a commodity for those with money, as has the city itself in a world where consumerism, tourism, cultural and knowledge-based industries, as well as perpetual resort to the economy of the spectacle, have become major aspects of urban political economy, even in India and China. The postmodernist penchant for encouraging the formation of market niches, both in urban lifestyle choices and in consumer habits, and cultural forms, surrounds the contemporary urban experience with an aura of freedom of choice in the market, provided you have the money and can protect yourself from the privatization of wealth redistribution through burgeoning criminal activity and predatory fraudulent practices (which have everywhere escalated). Shopping malls, multiplexes, and box stores proliferate (the production of each has become big business), as do fast-food and artisanal market places, boutique cultures and, as Sharon Zukin slyly notes, “pacification by cappuccino.” Even the incoherent, bland, and monotonous suburban tract development that continues to dominate in many areas, now gets its antidote in a “new urbanism” movement that touts the sale of community and a boutique lifestyle as a developer product to fulfill urban dreams. This is a world in which the neoliberal ethic of intense possessive individualism can become the template for human personality socialization. The impact is increasing individualistic isolation, anxiety, and neurosis in the midst of one of the greatest social achievements (at least judging by its enormous scale and all-embracing character) ever constructed in human history for the realization of our hearts’ desire.
But the fissures within the system are also all too evident. We increasingly live in divided, fragmented, and conflict-prone cities. How we view the world and define possibilities depends on which side of the tracks we are on and on what kinds of consumerism we have access to. In the past decades, the neoliberal turn has restored class power to rich elites.11 In a single year several hedge fund managers in New York raked in $3 billion in personal remuneration, and Wall Street bonuses have soared for individuals over the last few years from around $5 million towards the $50 million mark for top players (putting real estate prices in Manhattan out of sight). Fourteen billionaires have emerged in Mexico since the neoliberal turn in the late 1980s, and Mexico now boasts the richest man on earth, Carlos Slim, at the same time as the incomes of the poor in that country have either stagnated or diminished. As of the end of 2009 (after the worst of the crash was over), there were 115 billionaires in China, 101 in Russia, 55 in India, 52 in Germany, 32 in Britain, and 30 in Brazil, in addition to the 413 in the United States.12 The results of this increasing polarization in the distribution of wealth and power are indelibly etched into the spatial forms of our cities, which increasingly become cities of fortified fragments, of gated communities and privatized public spaces kept under constant surveillance. The neoliberal protection of private property rights and their values becomes a hegemonic form of politics, even for the lower middle class. In the developing world in particular, the city
is splitting into different separated parts, with the apparent formation of many “microstates.” Wealthy neighborhoods provided with all kinds of services, such as exclusive schools, golf courses, tennis courts and private police patrolling the area around the clock intertwine with illegal settlements where water is available only at public fountains, no sanitation system exists, electricity is pirated by a privileged few, the roads become mud streams whenever it rains, and where house-sharing is the norm. Each fragment appears to live and function autonomously, sticking firmly to what it has been able to grab in the daily fight for survival.13
Under these conditions, ideals of urban identity, citizenship, and belonging, of a coherent urban politics, already threatened by the spreading malaise of the individualistic neoliberal ethic, become much harder to sustain. Even the idea that the city might function as a collective body politic, a site within and from which progressive social movements might emanate, appears, at least on the surface, increasingly implausible. Yet there are in fact all manner of urban social movements in evidence seeking to overcome the isolations and to reshape the city in a different social image from that given by the powers of developers backed by finance, corporate capital, and an increasingly entrepreneurially minded local state apparatus. Even relatively conservative urban administrations are seeking ways to use their powers to experiment with new ways of both producing the urban and of democratizing governance. Is there an urban alternative and, if so, from where might it come?
Surplus absorption through urban transformation has, however, an even darker aspect. It has entailed repeated bouts of urban restructuring through “creative destruction.” This nearly always has a class dimension, since it is usually the poor, the underprivileged, and those marginalized from political power that suffer first and foremost from this process. Violence is required to achieve the new urban world on the wreckage of the old. Haussmann tore through the old Parisian impoverished quarters, using powers of expropriation for supposedly public benefit, and did so in the name of civic improvement, environmental restoration, and urban renovation. He deliberately engineered the removal of much of the working class and other unruly elements, along with insalubrious industries, from Paris’s city center, where they constituted a threat to public order, public health and, of course, political power. He created an urban form where it was believed (incorrectly, as it turned out, in 1871) sufficient levels of surveillance and military control were possible so as to ensure that revolutionary movements could easily be controlled by military power. But, as Engels pointed out in 1872,
In reality, the bourgeoisie has only one method of solving the housing question after its fashion—that is to say, of solving it in such a way that the solution perpetually renews the question anew. This method is called “Haussmann” [by which] I mean the practice that has now become general of making breaches in the working class quarters of our big towns, and particularly in areas which are centrally situated, quite apart from whether this is done from considerations of public health or for beautifying the town, or owing to the demand for big centrally situated business premises, or, owing to traffic requirements, such as the laying down of railways, streets (which sometimes seem to have the aim of making barricade fighting more difficult) … No matter how different the reasons may be, the result is always the same; the scandalous alleys disappear to the accompaniment of lavish self-praise by the bourgeoisie on account of this tremendous success, but they appear again immediately somewhere else … The breeding places of disease, the infamous holes and cellars in which the capitalist mode of production confines our workers night after night, are not abolished; they are merely shifted elsewhere! The same economic necessity that produced them in the first place, produces them in the next place.14
Actually it took more than a hundred years to complete the bourgeois conquest of central Paris, with the consequences that we have seen in recent years of uprisings and mayhem in those isolated suburbs within which the marginalized immigrants and the unemployed workers and youth are increasingly trapped. The sad point here, of course, is that the processes Engels described recur again and again in capitalist urban history. Robert Moses “took a meat axe to the Bronx” (in his infamous words), and long and loud were the lamentations of neighborhood groups and movements, which eventually coalesced around the rhetoric of Jane Jacobs, at the unimaginable destruction not only of valued urban fabric but also of whole communities of residents and their long-established networks of social integration.15 But in the New York and Parisian case, once the brutal power of state expropriations had been successfully resisted and contained by the agitations of ’68, a far more insidious and cancerous process of transformation occurred through fiscal disciplining of democratic urban governments, land markets, property speculation, and the sorting of land to those uses that generated the highest possible financial rate of return under the land’s “highest and best use.” Engels understood all too well what this process was about too:
The growth of the big modern cities gives the land in certain areas, particularly in those areas which are centrally situated, an artificially and colossally increasing value; the buildings erected on these areas depress this value instead of increasing it, because they no longer belong to the changed circumstances. They are pulled down and replaced
