above all with workers’ houses which are situated centrally and whose rents, even with the greatest overcrowding, can never, or only very slowly, increase above a certain maximum. They are pulled down and in their stead shops, warehouses and public building are erected.16
It is depressing to think that all of this was written in 1872, for Engels’s description applies directly to contemporary urban processes in much of Asia (Delhi, Seoul, Mumbai) as well as to the contemporary gentrification of, say, Harlem and Brooklyn in New York. A process of displacement and dispossession, in short, also lies at the core of the urban process under capitalism. This is the mirror image of capital absorption through urban redevelopment. Consider the case of Mumbai, where there are 6 million people considered officially as slum-dwellers settled on land for the most part without legal title (the places where they live are left blank on all maps of the city). With the attempt to turn Mumbai into a global financial center to rival Shanghai, the property development boom gathers pace and the land the slum-dwellers occupy appears increasingly valuable. The value of the land in Dharavi, one of the most prominent slums in Mumbai, is put at $2 billion, and the pressure to clear the slum (for environmental and social reasons that mask the land grab) is mounting daily. Financial powers, backed by the state, push for forcible slum clearance, in some cases violently taking possession of a terrain occupied for a whole generation by the slum-dwellers. Capital accumulation on the land through real estate activity booms as land is acquired at almost no cost. Do the people forced out get compensation? The lucky ones get a bit. But while the Indian constitution specifies that the state has the obligation to protect the lives and well-being of the whole population irrespective of caste and class, and to guarantee rights to livelihood housing and shelter, the Indian Supreme Court has issued both non-judgments and judgments that rewrite this constitutional requirement. Since the slum-dwellers are illegal occupants and many cannot definitively prove their long-term residence on the land, they have no right to compensation. To concede that right, says the Supreme Court, would be tantamount to rewarding pickpockets for their actions. So the slum-dwellers either resist and fight or move with their few belongings to camp out on the highway margins, or wherever they can find a tiny space.17 Similar examples of dispossession (though less brutal and more legalistic) can be found in the US, through the abuse of rights of eminent domain to displace long-term residents in reasonable housing in favor of higher-order land uses (such as condominiums and box stores). Challenged in the US Supreme Court, the liberal justices carried the day against the conservatives in saying it was perfectly constitutional for local jurisdictions to behave in this way in order to increase their property tax base.
In Seoul in the 1990s, the construction companies and developers hired goon squads of sumo-wrestler types to invade whole neighborhoods and smash down with sledgehammers not only the housing but also all the possessions of those who had built their own housing on the hillsides of the city in the 1950s, on what by the 1990s had become high-value land. Most of those hillsides are now covered with high-rise towers that show no trace of the brutal processes of land clearance that permitted their construction. In China millions are being dispossessed of the spaces they have long occupied. Lacking private property rights, they can be simply removed from the land by the state by fiat, offered a minor cash payment to help them on their way (before the land is turned over to developers at a high rate of profit). In some instances people move willingly, but widespread resistance is also reported, the usual response to which is brutal repression by the Communist Party. In the Chinese case, it is often populations on the rural margins who are displaced, illustrating the significance of Lefebvre’s argument, presciently laid out in the 1960s, that the clear distinction that once existed between the urban and the rural was gradually fading into a set of porous spaces of uneven geographical development under the hegemonic command of capital and the state. In China, rural communes on urban fringes went from the backbreaking and impoverishing labor of growing cabbages to the leisurely status of urban rentiers (or at least their commune party leaders did) growing condominiums, as it were, overnight. This is the case also in India, where the special economic development zones policy now favored by central and state governments is leading to violence against agricultural producers, the grossest of which was the massacre at Nandigram in West Bengal, orchestrated by the ruling Marxist political party, to make way for large-scale Indonesian capital that is as much interested in urban property development as it is in industrial development. Private property rights in this case provided no protection.
And so it is with the seemingly progressive proposal of awarding private property rights to squatter populations in order to offer them the assets that will permit them to emerge out of poverty. This is the sort of proposal now mooted for Rio’s favelas, but the problem is that the poor, beset with insecurity of income and frequent financial difficulties, can easily be persuaded to trade in that asset for a cash payment at a relatively low price (the rich typically refuse to give up their valued assets at any price, which is why Moses could take a meat axe to the low-income Bronx but not to affluent Park Avenue). My bet is that, if present trends continue, within fifteen years all those hillsides now occupied by favelas will be covered by high-rise condominiums with fabulous views over Rio’s bay, while the erstwhile favela-dwellers will have been filtered off to live in some remote periphery.18 The long-term effect of Margaret Thatcher’s privatization of social housing in central London has been to create a rent and housing price structure throughout the metropolitan area that precludes lower-income and now even middle-class people from having access to housing anywhere near the urban center. The affordable housing problem, like the poverty and accessibility problem, has indeed been moved around.
These examples warn us of the existence of a whole battery of seemingly “progressive” solutions that not only move the problem around but actually strengthen while simultaneously lengthening the golden chain that imprisons vulnerable and marginalized populations within orbits of capital circulation and accumulation. Hernando de Soto argues influentially that it is the lack of clear property rights that holds the poor down in misery in so much of the global south (ignoring the fact that poverty is abundantly in evidence in societies where clear property rights are readily established). To be sure, there will be instances where the granting of such rights in Rio’s favelas or in Lima’s slums liberates individual energies and entrepreneurial endeavors leading to personal advancement. But the concomitant effect is often to destroy collective and non-profit-maximizing modes of social solidarity and mutual support, while any aggregate effect will almost certainly be nullified in the absence of secure and adequately remunerative employment. In Cairo, Elyachar, for example, notes how these seemingly progressive policies create a “market of dispossession” that in effect seeks to suck value out of a moral economy based on mutual respect and reciprocity, to the advantage of capitalist institutions.19
Much the same commentary applies to the micro-credit and micro-finance solutions to global poverty now touted so persuasively among the Washington financial institutions. Micro-credit in its social incarnation (as originally envisaged by the Nobel Peace Prize winner, Yunus) has indeed opened up new possibilities and had a significant impact on gender relations, with positive consequences for women in countries such as India and Bangladesh. But it does so by imposing systems of collective responsibility for debt repayments that can imprison rather than liberate. In the world of micro-finance as articulated by the Washington institutions (as opposed to the social and more philanthropic orientation of micro-credit proposed by Yunus), the effect is to generate high-yielding sources of income (with interest rates of at least 18 percent, and often far higher) for global financial institutions, in the midst of an emergent marketing structure that permits multinational corporations access to the massive aggregate market constituted by the 2 billion people living on less that $2 a day. This huge “market at the bottom of the pyramid,” as it is called in business circles, is to be penetrated on behalf of big business by constructing elaborate networks of salespeople (chiefly women) linked through a marketing chain from multinational warehouse to street vendors.20 The salespeople form a collective of social relations, all responsible for each other, set up for guaranteeing repayment of the debt plus interest that allows them to buy the commodities that they subsequently market piecemeal. As with granting private property rights, almost certainly some people (and in this case mostly women) may even go on to become relatively well-off, while notorious problems of difficulty of access of the poor to consumer products at reasonable
