Cities For Sale

A new book takes on neoliberal attempts to revitalize urban centers.

By Ben Adler
Friday April 20, 2007

This article is reprinted from The American Prospect.

If you live in or near a big city, you may not realize that neoliberalism is fiendishly taking over your environ. No, it’s not just the Starbucks by your office, or the Gap that just opened in the once-edgy neighborhood. It’s also the high-rise condominium apartment building going up over the subway station, the new sports arena downtown, the industrial loft conversion, and even the brownstone getting flipped in that sketchy neighborhood.

Jason Hackworth, an associate professor of geography and planning at the University of Toronto, has found a common theme among those trends — gentrification, privatization, corporate invasion, and public-private revitalization projects — that have come to symbolize renewal in America’s urban core in recent years. In his new book, The Neoliberal City: Governance, Ideology, and Development in American Urbanism, he argues they are all manifestations of the international trend towards neoliberalism, which he defines as “an ideological rejection of egalitarian liberalism in general and the Keynesian welfare state in particular, combined with a selective return to classical liberalism.”

In the 1970s and ’80s many American cities faced fiscal crises due to a decimated industrial employment base and large unfunded liabilities for public employees. Bond-rating agencies downgraded their bonds, which prevented municipal governments from borrowing more money to close fiscal shortfalls. Cities had to cut payrolls and scale back public investments. Consequently the bond ratings went back up, but the size of public payrolls did not. In many cities a neoliberal consensus has since emerged: City governments should be lean, major construction should be undertaken by the private sector, and gentrification should be encouraged as a means of increasing the tax base.

While Hackworth’s approach is purely descriptive, it is clear that he opposes neoliberalism and looks kindly on attempts to “resist” it. His in-depth analysis of gentrification, which he calls “the knife-edge neighborhood based manifestation of neoliberalism,” is the most telling in this regard. Clearly, he takes a dim view of its propensity to displace the less affluent. As Hackworth also argues, “Recent economic restructuring appears to have altered the real estate industry in such a way as to encourage the presence of large corporate gentrifiers more than small-scale owner-occupiers.”

Hackworth is very critical of the shift away from construction of massive public housing projects towards HOPE VI (breaking apart the projects into smaller units) and Section 8 vouchers (which enable poor families to live in partially subsidized regular housing.) He sees these programs as expressions of neoliberalism in the urban environment and as causes of displacement of the poor (since there end up being fewer total units of public housing). The overall lack of affordable housing, meanwhile, combined with the creep of gentrification, is squeezing the middle class out of the city.

Ironically, while he is clearly on the left politically, Hackworth seems to find a lot of common ground with neo-conservative urban theorist Joel Kotkin, who has argued that “[e]verywhere — from New Orleans to London and Paris — the middle classes, whatever their colour, are deserting the core for safer and more affordable suburbs, following in the footsteps of high-tech industries and major corporations.”

Kotkin’s career has lately been devoted to debunking Richard Florida’s “creative class” theory of urban revitalization. Where Florida sees hope for cities to rescue themselves from post-industrial depression through an invigorating influx of young creative professionals, Hackworth, like Kotkin, decries the result as a city of only rich and poor and bemoans the loss of middle-class families. (It should be noted, though, that Hackworth seems to argue for a different kind of urban revitalization, while Kotkin essentially argues for suburbanization — so it’s safe to say that they would disagree a great deal as well.)

While The Neoliberal City is informative on the subject of privatization and corporate involvement in gentrification, it leaves the reader a bit puzzled. Hackworth only describes, he does not prescribe. So while it is clear that he thinks the neoliberal city is deeply problematic, he presents no alternative. He states that “[t]he days of Keynesian urban policy seem to have expired — or at least gone into hibernation — and city governments have adapted to the new conditions.” It seems he would agree that pushing massive urban public construction projects, such as those associated with New Deal and Great Society-era programs and a bygone industrial age, is no longer a realistic direction for urban America.

But then what is? The cities that look and feel vibrant today are the ones, like New York, San Francisco, Boston, Austin, and Portland, that have done precisely what the creative class naysayers oppose. They have welcomed white-collar employees by taking measures such as redesigning zoning codes to accommodate their desire to live in lofts carved out of former industrial buildings. Consequently, these cities have captured much of the yuppies’ disposable income and developed strong service sectors to support their dining and entertainment habits. Yes, this leads to a city of rich professionals and the poor who serve them cappuccino. But ask the pre-gentrification residents of Harlem and they will tell you that $7 per hour is better than nothing. And for many cities, that is the alternative. Besides, this stratification is merely a microcosm of national economic trends.

Hackworth admits at the beginning that “it is reasonable to ask why the inner-city — particularly the American inner city — is a useful space through which to evaluate the process of neoliberalism.” but, he argues,

This book takes the position that precisely because [emphasis in original] the United States is such a thoroughly liberalized environment, the identification of changes within this context could very likely be harbingers of changes globally. That is, while the transition to neoliberalism in agriculture-oriented developing countries is easier to identify, documenting the influence of neoliberalism on American cities likely portends similar changes in other parts of the world.

Many commentators have suggested it’s time for a new social contract that emphasizes public investment and a commitment to building an egalitarian, middle-class society. Michael Tomasky argued in this magazine that liberals should frame their beliefs around a commitment to the common good. Thomas Kochan and Beth Shulman of the Economic Policy Institute recently proposed a new social contract for “restoring dignity and balance to the economy.” Key points included a living wage, enforcement of labor standards in trade agreements, universal health coverage, and “macroeconomic policies that support good jobs.” Presumably, if enacted, those policies would manifest themselves on the local level in the cities Hackworth studies. And then Hackworth can be the first in line for a latte at the shiny new unionized Starbucks.

Ben Adler is the editor of CampusProgress.org

This article is available on The American Prospect website.

© 2006 by The American Prospect, Inc.

This article was originally published in The American Prospect.

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Comments

1. ““Yes, this leads to a city of rich professionals and the poor who serve them cappuccino.”“

   Stepping back from the points you’re making for a second and looking at this one image — I’ve never understood why this image is considered evocative. I’ve heard it, or ones just like it, used a hundred times.

   If we’re paying someone to serve cappuchino, wouldn’t it be someone whose primary moneymaking means is unskilled labor?

   Is there something undignified about working in the service sector?

   If so, what’s the alternative – robots?

   It’s just inherently silly, as an image that’s supposed to have emotional weight.

   A huge amount of the world’s financial growth is related, in some way or another, to parting the rich from their money.

   Isn’t that income redistribution, in a sense? How is that not progressive?

   — Joe - Apr 20, 06:59 PM - #
   
   

2. There is nothing undignified about working in the service sector. However, why is the alternative to a $20 or more per hour job at a factory that is moved out of the country a minimum wage job serving coffee or flipping burgers? What is wrong with being concerned about the widening gap between the rich and poor? minimum wage is not income redistribution, it’s throwing a bone at the poor and falsifiying statistics of “gainful” employment.

   — Brian - Apr 22, 11:29 PM - #
   
   

3. I think the quote is controversial because you are right, there is nothing wrong with the service sector, but these people can’t live in the community they work in. That is the problem. Pair that with the idea that they probably recently lived in the community but were pushed out by all the “development,” and that is gentrification at the core.

   I want to read this book, because while I don’t blame the gentrifiers (everyone just wants a nice place to live), I wonder what cities can do.

   — Colleen - Apr 27, 01:47 PM - #
   
   

4. I think that a neoliberal would admit that there are problems with the corporate structure. Unforunately we are stuck with a corporate structure that resulted from a compromise between liberal and conservative ideologies that balance personal rights and privacy with corporate protectionism.
   We should ralley around the idea of creating rules that promote an economy that works for the people who live in it. Also, the debate over the benefits of private vrs. public sector economic models is mostly a smoke screen for the unaccountable. Either model works fine (most of the time) with responsible leaders making ethical and even handed decisions. If you want to talk about a downfall of neopolitics its that its spineless. Liars are now simply “inaccurate” or “disingenuis.”

   — Ryan - Apr 27, 03:56 PM - #
   
   

5. Joe,
   I’d like to respond to your idea of redistribution of wealth being a progessive idea.

   To think progressively about wealth, you have to ask yourself, what is money — or what is the best use of money?

   Undoubtedly, money does provide you with “things”... but after you have what you need (I mean necessities), your money has options. It can either get you more things (things that you think you own, but such things typically end up owning its owners time, i.e. a home so big it’s doesn’t serve a perpose other than upkeep, decor, ect.), OR money can be used to motivate others. It opens doors of opportunity. Opportunity to organize others, to express ideas, to pay people for their time, their eiffort. That orginization’s goals are up to the investor. Here in the U.S., money is typically spent to make more money…. but there are nonprofit opportunities to bring about positive change. I hope that we all support and encourage our government to provide more incentives for individuals to organize such positive movements… but the results can be a damn good incentive too.

   — Ryan - May 1, 12:00 PM - #
   
   

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