Fractured Cities

Capitalism, Community and Empowerment in Britain and America

Brian D. Jacobs

• Publisher: Routledge
• Year: 2003
• eBook ISBN: 9781134898480
• Edition: 1
• Topic: Scienze fisiche
• Subtopic: Geografia umana

Anglo-American cities face economic decline, social polarisation and racial conflict. Their fate is increasingly decided by the global actions of transnational corporations and market forces. Community groups find it difficult to gain access to the political system. Ethnic minorities strive for empowerment while indebted city governments battle to maintain basic services. Such is the urban crisis of the 1990s. Fractured Cities describes the political economy of urban change and explores the future of the city.

1
Perspectives

Gabriel Almond (1988, p. 853) notes that pluralism and Marxism now represent ‘waning paradigms of contemporary political science’. While this is probably an over-simplification, as Almond admits, both the pluralist and Marxist approaches were affected by the onslaught of ‘new right’ thinking and both initiated important theoretical reassessments which had important implications for urban analysis. This chapter considers the renewed interest in conservative and neo-liberal approaches and provides a critical examination of public choice, collectivist and pluralist approaches to urban political analysis.

A New Climate

Theoretical problems for the left were associated with real-life political change. The British Labour party underwent a major review of its policies and took steps to reduce the influence of its left wing. Prominent Labour politicians such as Brian Gould advocated market solutions as the way forward for Labour (Gould, 1989) and argued that the socially responsive ‘socialist market’ would be the answer to attacks against the welfare state (Miller and Estrin, 1986; Goss, 1988; Stoker, 1988).

In the USA, the new conservative agenda affected some of the most outspoken politicians. The 1988 Presidential bid by Jesse Jackson was initially widely regarded as being representative of the interests of the urban poor and more in line with the radical campaigning traditions of some of the former liberals who had taken up the demands of the deprived. Jackson’s desire to mobilise blacks and other minorities struck a populist chord in the ghettos and even attracted support amongst significant sections of the white electorate. His attempt to consolidate a ‘rainbow coalition’ which would give minorities greater influence in government was a clarion call to those who believed that a radical set of policies was necessary to improve the condition of the poor and open American government to the effective representation of their interests. For Jackson, this was the best way to pressure government to grant economic reforms and to campaign against the social problems of the cities.

Jackson’s decision to support the cautious Democratic Presidential candidate, Michael Dukakis, signified his willingness to make compromises with a ‘technocrat’ who was supportive of only a modest programme of policy initiatives to aid the cities and the poor. Even though the Jackson campaign had pointed to the need for changes which would address the problems caused by market failure, there was still an assumption amongst liberals in the Democratic party that the market would have to be the main motive force to provide new opportunities for communities.

Walker (1990) assesses the impact of political change in the USA in terms of a move away from traditional working class activism and the ‘gentrification’ of the left. This involved the left reducing its links with the trade unions and becoming less reliant on Marxist-style ‘vanguardism’. This was marked by a reorientation in response to changes in the structure of the labour market and the development of ‘issue politics’ around concerns such as the environment, Aids, race and gender. Many of the small groups active in these areas orientated towards the Democratic party.

The 'New Right'

In the 1980s, the appeal of ‘the market’ implied that individual rights would increasingly be linked to the democratising effects produced by market activity. This was seen by the right as an essential aspect of the liberation of the individual from collectivism and socialism. Much of the inspiration for this reaction against welfare-liberalism and state socialism came from the ‘new right’ (King, 1987a). Despite the radical aspect of this attack, The new right’s analyses is often described as consisting largely of reformulations of ‘traditional’ conservative and liberal ideas (Levitas, 1986b).

Levitas (1986b, 1986c) argues that there was considerable variance between those who described themselves as new right. Writers, such as Bosanquet (1983), used the term to refer to a form of neo-liberal laissez-faireism influenced by Schumpeter, Hayek, Milton Friedman and others. Green (1987) traces the roots of the new right to the economic thinking of the Chicago School of economists such as Milton Friedman, to Friedrich Hayek and the Austrian School, and to public choice theorists.

For ease of exposition, the definition of the new right used by Ashford and Davies (1991) is adopted here. This refers to the new right as the entire collection of conservative and neo-liberal movements which have grown up in North America and Europe since the 1960s. The new right is not an ideologically homogeneous group, but consists of a variety of trends, many of which do not fit into the traditional left-right spectrum. For Ashford and Davies, the primacy of the debate about economics has tended to highlight the common ground between those on the new right and has obscured the ‘many and profound’ divisions over a range of political issues. This applies even within the neo-liberal and neoconservative sub-categories where there are several separate groups, schools or movements.

Ashford and Davies point to the traditional conservative movement in Britain and the USA, represented by figures such as Scruton (1984) and Kirk (1953). Conservatives of this kind should not be confused with the American neoconservatives such as Kristol (1983) and Podhoretz (1979) who combine a strong social commitment with a market orientation. In turn, this group is different in orientation to the neo-liberals who stress the importance of individual rights and the limitation of the state. The main divisions are indicated below.

1. Traditional conservatives who emphasise traditional ‘Tory’ interests such as hierarchy and order in opposition to socialism.
2. Neo-liberals (Friedman and Hayek for example) who have revived and developed classical liberal ideas such as the importance of the individual, the limited role of the state and the value of the free market. These classical liberals can be divided into the three major neo-liberal schools: Chicago, Austrian and public choice. There is a strongly libertarian vein in neo-liberalism which, at its extreme, goes over into the minimal statism of Nozick (1974) and the anarcho-capitalism of Rothbard (1978). Rather confusingly, ‘neo-liberalism’ has also been used in the USA to describe a group of market-orientated ‘left-liberals’ who have been critical of the intervention of the state (Ashford, 1991, p. 186).
3. Neo-conservatives who, in the USA, are a group of former left liberal intellectuals who became more conservative in the 1960s. In the UK, neoconservatism has also been used to refer to the traditional conservative revival as in 1 above.
4. The Moral Majority is a term used to describe groups which are linked to, but distinct from, the new right. They include religious and other fundamentalist organisations committed to moral values in public and private life. They are varied; some support an active state while others are ‘libertarian’ (Davies, 1991, p. 188).

The Market

The neo-liberal new right generally based its ideology on ideas about individualism and the necessity for free market solutions to economic problems. There was a rejection of the social efficiency criterion that had been used to justify government intervention (Cheung, 1978; Levačić, 1987). The market was seen as an integrating force affecting society as a whole and having the potential to produce social order, justice, economic growth and higher standards of living even for the very poorest members of society. Within the economic framework, there were forces which interfered with the market’s effective working, such as the imperfections imposed by organised political interests (Levitas, 1986b, p.2). Invariably, organised government was targeted as a primary source of market inefficiency.

Liberation stemmed from the reduction of the role of government (Gray, 1989). Reagan and Thatcher both favoured counter-interventionist policies (Savage and Robins, 1990) and many influential new right interest groups and research organisations exerted pressure on them to influence their ideas on important issues such as the expansion of market opportunities and the promotion of the ‘property-owning democracy’.

In Britain, the Institute of Economic Affairs, the National Association of Freedom, the Centre for Policy Studies and the Adam Smith Institute were important in generating new ideas about the reform of education, social welfare and health services and the improvement of local and national government administration. How far the new right ‘think tanks’ influenced the Conservative party is difficult to assess precisely, but new right thinkers were widely respected as legitimate sources of inspiration on policy within the party (Levitas, 1986b). In the USA, the Heritage Foundation and the American Enterprise Institute were prominent in pursuing market-orientated policies together with a variety of other powerful new right-influenced Washington lobby groups (Meyer, 1982).

The Realities of Power

The link between theory and practice was subtle. Neither Reagan-Bush nor Thatcher-Major were ever pure ideologues (see Introduction, pp. 12–13). The assimilation of new right ideas into policy was always pragmatic and related to the practicalities of political life. David Stockman, one of Ronald Reagan’s senior economic advisors who headed the Office of Management and Budget up to 1985, graphically describes Reagan’s response to the ideas of the supply-side economists:

He [Reagan] leaned to the right, there was no doubt about that. Yet his conservative vision was only a vision. He had a sense of ultimate values and a feel for long-term directions, but he had no blueprint for radical governance. He had no concrete program to dislocate and traumatise the here-and-now of American society.

(Stockman, 1986, p. 10)

Political compromises, and the strength of the bureaucracy, helped to strengthen the tendency on the right to distrust the political system. Government departments were seen as bureaucratic monsters which could blunt the aspirations of even the best free marketeer (Hoover and Plant, 1989). While the American left looked to the legislative branch of government to act as a check on the excesses and failures of the market or to local activism (Walker, 1990), the new right saw government as a hinderance to the development of the market and the legislative branch as susceptible to the pressures of vested interests.

Public Choice

There was, therefore, a strong feeling on the right that politics and economics were linked; a contention which was at the centre of Marxist thought. With public choice theory it was possible to interpret political actions with reference to the actions of individuals and the aggregation of preferences. Economics and politics were both concerned with scarcity and the allocation of resources (McLean, 1987, p. 9). The analysis of the rational actions of individuals could therefore provide a powerful tool as a means of understanding government resource allocations. In this, public choice theory provided much that was of value in developing a view of the role of government and the motivations and interests of public bureaucrats. Public choice theory thus moved from a ‘first principles’ analysis using techniques like game theory and mathematical economics to a coherent ‘institutional’ analysis dealing with the processes and institutional behaviour of liberal democracy (Dunleavy, 1991).

The variability and flexibility of public choice theory, combined with the power and value of many of its rational choice assumptions, contributed to its expansion. By the mid-1980s public choice was regarded as the major trend in academic political science in the USA (McKay, 1984) and a major point of reference for political science and urban research in the UK. Lovrich and Neimen argue that

it was inevitable that interest in public choice theory would spread beyond the narrow confines of academic audiences. There is also a ‘practitioner’ audience far in excess of what normally exists for other forms of innovative, theoretical formulations. The current sad state of the national-international economy, the advent of a conservative administration in this country [the USA], the expansion of popular movements in several states to limit taxes, the passage of ‘sunset’ legislation are all, perhaps, manifestations of a loss of faith in conventional ideas about how the economy can be managed, how social problems can best be tackled (or ignored) by government, and how bureaucracies can be improved to better serve the people. Currently successful politicians, and those high-level administrators appointed by them, promise ‘new, innovative approaches’. These new perspectives feature a ‘lean, effective and non-threatening’ governmental presence entailing less regulation, lower taxes, more localized admin- istration of programs, and a greater reliance upon both the private sector and volunteerism among the citizens.

(Lovrich and Neiman, 1984, p. xxii)

Public Choice and the Right

The left lost the initiative in developing a rational-institutional perspective which could address the challenges posed by such issues. Therefore, while public choice methodology is ‘not intrinsically tied to right-wing political values (Dunleavy, 1991, p. 5), institutional public choice theory became largely associated with the right as it built upon the assumptions of liberal economics and became associated with innovative approaches to difficult problems concerning the growth and inefficiencies of government. There was also a tendency mistakenly to regard public choice as being synonymous with the wider field of rational choice. Rational or social choice theorists were in fact often critical of many of the economic assumptions of public choice (North, 1986).

Even so, in public choice theory, the right possessed a very effective rational economic critique of socialism and public intervention (Downs, 1957). The right also challenged the assumptions made by Keynesian economists about how full employment and economic expansion could be bought through government intervention (Buchanan, Wagner and Burton, 1978). Public choice broadened the field of attack. Government created inflation, maldistributed resources and produced welfare commitments which were ill-suited to the achievement of self-sustaining economic growth. In short, government was responsible for recession and low growth.

Politics was seen to be in the same parlous state as the economy; influenced by welfare-liberals and interventionist socialists. Political leaders of this kind were said to be incapable of responding to the needs of the people and guilty of pursuing policies which hampered the efficient distribution of resources to communities and led to a deleterious centralisation of governmental power and authority (Bolick, 1988). At local level, vested interests often monopolised city and town governments and followed policies which had brought localities either into financial debt or to the edge of social disorder.

Public Goods

Economics was about the scarcity of resources and their distribution. Public choice theories related political action to economic scarcity by concentrating upon the most effective mechanisms for producing wealth in capitalist society. It was argued that in allocating resources a range of ‘public ...

Table of contents

• Cover
• Title
• Copyright
• Contents
• List of figures
• List of tables
• Preface
• INTRODUCTION: URBAN CRISIS AND CHANGE
• 1 PERSPECTIVES
• 2 THE ROLE OF THE STATE
• 3 URBAN AMERICA: HIGH TECHNOLOGY AND POVERTY
• 4 URBAN BRITAIN: ENTERPRISE AND THE UNDERCLASS
• 5 LOCAL GOVERNMENT AND URBAN POLICY IN THE UNITED STATES
• 6 LOCAL GOVERNMENT AND URBAN POLICY IN BRITAIN
• 7 INCORPORATING COMMUNITY POLITICS
• 8 MINORITIES: 'EMPOWERMENT' AND DISSENT
• 9 CORPORATE VISIONS
• 10 INITIATIVES BEYOND CHARITY
• 11 WHITHER THE CITIES?
• References
• Index