ground handling, catering services, and petroleum distribution sectors. More than 50 percent of the state shares were privatized in tourism, iron and steel, textiles, sea freight, and meat processing sectors. The state has partially withdrawn from the ports and petroleum refinery sector. Privatization of public banks has commenced with Sümerbank and continued with Etibank, Denizbank, and Anadolu Bank. Public utilities like telecommunications and transportation were also opened to the private sector (YASED 2006: 20–22).
Privatization of public enterprises had major effects on middle-class families. Those who worked for the public sector lost their jobs and had a hard time finding new employment with similar salaries and benefits, given the high unemployment rates in the economy. Meanwhile, because public enterprises and services were privatized, middle-class families lost their access to affordable subsidized goods and services. Both developments led to the erosion of middle-class purchasing power.
Privatization affected social welfare provisions as well. Education, health care, and social security all experienced lower public investments under liberalization. Throughout the 1980s, the ratio of public spending on education and health services to gross domestic product showed a continuous downward trend. The withdrawal of the state from the provision of these services led to their commodification. From 1994 on, private investors started moving into these sectors due to generous government incentives. By 1996–97, the private sector's share in total education and health investments reached 50 percent (Boratav et al. 1995: 359). An expensive and in many ways luxurious private health care system emerged alongside the overextended public health system. The private system was supported by private health insurance schemes while public health care suffered from lack of public spending. This dual system clearly demonstrated the polarization of service delivery in the society. The core middle class was limited with insufficient public services due to loss of income, while the emerging new middle class enjoyed the benefits of the expensive private system. Within recent collective memory, social benefits and services that had been proclaimed by the government as the welfare of the ortadirek had become costs on capital accumulation and the pursuit of free enterprise.
In conclusion, during the neoliberal era of capital accumulation by dispossession, many professionals and businessmen of the Turkish “new economy” utilized their education and social connections to become part of the global “new economy,” which was constantly creating new demand for specific occupations that required special individuals with special education. Speaking a foreign language, having a degree from a prestigious university (often abroad), being interested in the business culture, cultivating certain consumption habits, and being ready to adopt (or at least adapt to) “the American way of life” or its French or German variants were among the most desired qualities for success in the new economy.
State enterprises, however, were slow to change, and most of the core middle-class professionals, managers, and technicians worked for public institutions or state-owned enterprises. State employees differed in wages and other material and social capitals from their counterparts in the private sector and lacked the entrepreneurial credentials and opportunistic predispositions sought by the new economy. Many were not positioned to take advantage of the opportunities being generated by fast-track growth. They remained ideologically committed to national developmentalism and viewed capitalist ideology with some suspicion.
The Neoliberal Landscape in Istanbul
As described above, national middle classes are becoming more differentiated as a consequence of the new economy, new wealth, and lifestyles that reflect the ideology of the global consumer culture. The significance of the emerging global new middle classes is that they represent a new historical phase of capitalist accumulation that differentiates them from national upper middle classes of the past. They move “closer” to capital than to labor by means of participating more in the process of accumulating capital and less in their reliance on salary. They are stakeholders in the new economy and demonstrate the aspirations more of an upper class than of an industrial core middle class.
In every country, some cities more than others are involved in the organizations and networks of the global economy. At the same time, these cities are embedded in national aspirations and subject to regulation by the state. In Turkey, Istanbul, a major commercial and financial center, has emerged as the country's globalizing city. What follows is an attempt to establish the appearance of a historically particular new middle class in Istanbul as a consequence of the liberalization of the Turkish economy. Taking into account the relationships among state, market, and family institutions in class formation, the substantive areas of emphasis will be on cultural capital in the forms of lifestyle and material capital in the form of housing.
Nowhere in Turkey was the middle class more affected by neoliberal ideology and policies than in Istanbul, a world city that after 1980 became a globalizing city. How did Istanbul become a globalizing city, and how did a conjunction of global, national, and local forces contribute to the remaking of a fragment of the upper middle class as a new middle class? In the last two decades of the twentieth century, Istanbul underwent an economic revival and cultural transformation as the central location of Turkey's integration into the global economy. It became a globalizing city, the center of changes in transnational networks of foreign capital, currency exchange, import-export trade, media and communications, and technology that emanated from other parts of the world. A key part of this transformation was the appearance of a new cosmopolitanism, reflected in an outward-looking new middle class that was entrepreneurial in spirit, quick to embrace the cultural ideology of consuming everything foreign, and engrossed in postmodern preoccupations with the deconstruction of old identities in the interest of creating new ones.
Globalizing Cityscapes
While Turgut Özal's Motherland Party pursued the political strategy of urban populism to win the national election in Istanbul, one of its members, Mayor Bedrettin Dalan, pursued an economic strategy more in tune with the Motherland Party's liberalization strategy for global integration. The two strategies worked in tandem to reshape Istanbul's cityscape during the 1980s. The Ankara government set the parameters by changing the administration of metropolitan government, passing legislation that created new channels of funding to pursue a variety of urban renewal projects, and instituting the National Housing and Investment Administration, which through the Mass Housing Fund underwrote the enormous expansion of Istanbul real estate markets. Perhaps as important as any of these policies was Dalan's vision of Istanbul as an international city and his ability to articulate his vision in a way that mobilized business interest groups to enact it.
The Motherland government began to increase progressively the proportion of total tax revenues allocated to municipal administrations. In 1983, new legal provisions also allowed metropolitan governments to levy and or increase local taxes, fees, and charges on activities ranging from sports and entertainment to advertising. These activities were among the growth sectors of the urban economy. Increases in tax revenue not only allowed the city to undertake projects to improve physical infrastructure but it also financed a new fleet of buses and imported new passenger ships at a time when the center city was becoming more congested from increased automobile traffic (Keyder and Öncü 1993: 26). In 1984, the Motherland Party enacted a law designed to centralize major metropolis-wide functions and place them under the direct control and authority of the metropolitan mayor.
The Globalizing Cityscape 1: Commodification of Culture as Heritage
Mayor Dalan's economic strategy for globalizing Istanbul reflected his vision of an international city that would attract conferences and tourists from all over the world. But his vision extended beyond the usual trade and commerce industries to wed economic prosperity to cultural industries by imagining past history as heritage, an accumulation history of eleven centuries of Byzantine Constantinople followed by five centuries of Ottoman Istanbul as centers of world power and commerce. Business groups supported his initiatives, which included new highways, under- and overpasses, and clearance and beautification projects.
The historical peninsula
