Rebel Cities. David Harvey
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far more systematic than that. But if these various oppositional movements did somehow come together—coalesce, for example, around the slogan of the right to the city—then what should they demand?
The answer to the last question is simple enough: greater democratic control over the production and use of the surplus. Since the urban process is a major channel of use, then the right to the city is constituted by establishing democratic control over the deployment of the surpluses through urbanization. To have a surplus product is not a bad thing: indeed, in many situations a surplus is crucial to adequate survival. Throughout capitalist history, some of the surplus value created has been taxed away by the state, and in social-democratic phases that proportion rose significantly, putting much of the surplus under state control. The whole neoliberal project over the last thirty years has been oriented towards privatization of control over the surplus. The data for all OECD countries show, however, that the share of gross output taken by the state has been roughly constant since the 1970s. The main achievement of the neoliberal assault, then, has been to prevent the state share expanding in the way it did in the 1960s. One further response has been to create new systems of governance that integrate state and corporate interests and, through the application of money power, assure that control over the disbursement of the surplus through the state apparatus favors corporate capital and the upper classes in the shaping of the urban process. Increasing the share of the surplus under state control will only work if the state itself is both reformed and brought back under popular democratic control.
Increasingly, we see the right to the city falling into the hands of private or quasi-private interests. In New York City, for example, we have a billionaire mayor, Michael Bloomberg, who is reshaping the city along lines favorable to the developers, to Wall Street and transnational capitalist class elements, while continuing to sell the city as an optimal location for high-value businesses and a fantastic destination for tourists, thus turning Manhattan in effect into one vast gated community for the rich. (His developmental slogan, ironically, has been “Building Like Moses with Jane Jacobs in Mind.”21) In Seattle a billionaire like Paul Allen calls the shots, and in Mexico City the wealthiest man in the world, Carlos Slim, has the downtown streets re-cobbled to suit the tourist gaze. And it is not only affluent individuals who exercise direct power. In the town of New Haven, strapped for any resources for urban reinvestment of its own, it is Yale University, one of the wealthiest universities in the world, that is redesigning much of the urban fabric to suit its needs. Johns Hopkins is doing the same for East Baltimore, and Columbia University plans to do so for areas of New York (sparking neighborhood resistance movements in both cases, as has the attempted land-grab in Dharavi). The actually existing right to the city, as it is now constituted, is far too narrowly confined, in most cases in the hands of a small political and economic elite who are in a position to shape the city more and more after their own particular needs and hearts’ desire.
But let us look at this situation more structurally. In January every year an estimate is published of the total of Wall Street bonuses earned for all the hard work the financiers engaged in during the previous year. In 2007, a disastrous year for financial markets by any measure (though by no means as bad as the year that followed), the bonuses added up to $33.2 billion, only 2 percent less than the year before (not a bad rate of remuneration for messing up the world’s financial system). In midsummer of 2007, the Federal Reserve and the European Central Bank pumped billions of short-term credit into the financial system to ensure its stability, and the Federal Reserve dramatically lowered interest rates as the year progressed every time the Wall Street markets threatened to fall precipitously. Meanwhile, some 2 or perhaps 3 million people—mainly a mix of single-woman-headed households, African-Americans in central cities, and marginalized white populations in the urban semi-periphery—have been or are about to be rendered homeless by foreclosures. Many city neighborhoods and even whole peri-urban communities in the United States were boarded up and vandalized, wrecked by the predatory lending practices of the financial institutions. This population received no bonuses. Indeed, since foreclosure means forgiveness of debt, and that is regarded as income, many of those foreclosed on face a hefty income tax bill for money they never had in their possession. This awful asymmetry poses the following question: Why did the Federal Reserve and the US Treasury not extend medium-term liquidity help to the households threatened with foreclosure until mortgage restructuring at reasonable rates could resolve much of the problem? The ferocity of the credit crisis would have been mitigated, and impoverished people and the neighborhoods they inhabited would have been protected. Furthermore, the global financial system would not have teetered on the brink of total insolvency, as happened a year later. To be sure, this would have extended the mission of the Federal Reserve beyond its normal remit, and gone against the neoliberal ideological rule that, in the event of a conflict between the well-being of financial institutions and that of the people, then the people should be left to one side. It would also have gone against capitalist class preferences with respect to income distribution and neoliberal notions of personal responsibility. But just look at the price that was paid for observing such rules and the senseless creative destruction that resulted from it. Surely something can and should be done to reverse these political choices?
But we have yet to see a coherent oppositional movement to all of this in the twenty-first century. There is, of course, a multitude of diverse urban struggles and urban social movements (in the broadest sense of that term, including movements in the rural hinterlands) already in existence. Urban innovations with respect to environmental sustainability, cultural incorporation of immigrants, and urban design of public housing spaces are observable around the world in abundance. But they have yet to converge on the singular aim of gaining greater control over the uses of the surplus (let alone over the conditions of its production). One step, though by no means final, towards unification of these struggles is to focus sharply on those moments of creative destruction where the economy of wealth-accumulation piggy-backs violently on the economy of dispossession, and there proclaim on behalf of the dispossessed their right to the city—their right to change the world, to change life, and to reinvent the city more after their hearts’ desire. That collective right, as both a working slogan and a political ideal, brings us back to the age-old question of who it is that commands the inner connection between urbanization and surplus production and use. Perhaps, after all, Lefebvre was right, more than forty years ago, to insist that the revolution in our times has to be urban—or nothing.
CHAPTER TWO
The Urban Roots of Capitalist Crises
In an article in the New York Times on February 5, 2011, entitled “Housing Bubbles Are Few and Far Between,” Robert Shiller, the economist who many consider the great housing expert in the US, given his role in the construction of the Case-Shiller index of housing prices, reassured everyone that the recent housing bubble was a “rare event, not to be repeated for many decades.” The “enormous housing bubble” of the early 2000s “isn’t comparable to any national or international housing cycle in history. Previous bubbles have been smaller and more regional.” The only reasonable parallels, he asserted, were the land bubbles that occurred in the US back in the late 1830s and in the 1850s.1
This is, as I shall show, an astonishingly inaccurate and dangerous reading of capitalist history. The fact that it passed so unremarked testifies to a serious blind spot in contemporary economic thinking. Unfortunately, it also turns out to be an equally blind spot in Marxist political economy. The housing crash of 2007–10 in the US was certainly deeper and longer than most—indeed, it may well mark the end of an era in US economic history—but it was by no means unprecedented in its relation to macroeconomic disturbances in the world market, and there are several signs that it is about to be repeated.
Conventional economics routinely treats investment in the built environment in general, and in housing in particular, along with urbanization, as some side-bar to the more important affairs that go on in some fictional entity called “the national economy.” The sub-field of “urban economics” is thus the arena where inferior economists go while the big guns ply their macroeconomic trading skills elsewhere. Even when the latter notice urban processes, they make it seem as if spatial reorganizations, regional development, and the building of cities are merely some on-the-ground outcome of larger-scale processes that remain unaffected by that which they produce.2 Thus, in the 2009 World Bank