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How to build a fairer city

In the first in an occasional series looking at how
to make cities fairer for all, four leading
academics propose the grounded city where
sustainable transport, accessible broadband and
modest housing take precedence over
ostentatious tower blocks

Ewald Engelen, Sukhdev Johal, Angelo Salento and Karel Williams

theguardian.com, Wednesday 24 September 2014 13.16 BST

A 17th century engraving of the city of Milan. All images: De Agostini/Getty

In an urbanising world, everybody says they want a fairer city. If that is the aspiration,
the question is what stands in its way? What do we need to change to deliver that
fairness?
Our manifesto is about how the fairer city can be achieved by changing both the
imaginary and the practice underlying economic and social policy. The central argument
is that we can move towards a fairer city by reframing our problems and rethinking our
solutions in two ways:
1. Break with the dominant old problem of the competitive city, which competes
economically against other cities and sponsors internal competition for limited
opportunities.
2. Stop fixating on redistributive policies which will not deliver fairness, and start
thinking about reorganising policies which build a grounded economy in the areas
which are not exposed to competition.
The global obsession of our age is competing everywhere with everyone for everything.
In the mainstream imaginary, every city has to chase competitive success in a league
table where it secures prosperity by getting ahead of others.
Our premise is that competition is the wrong kind of imaginary; that we are trapped by
an idea of the externally competitive city as a basis for economic success. The content
and meaning of that success then goes largely unexamined until somebody notices that
prosperity is manifestly failing to trickle down and the tax system actually reinforces
income inequality.
This manifesto argues for a different kind of imaginary: the grounded city. The success
of a city should not be measured externally by relative size and the ability to come first

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ahead of equals; rather, the measure should be a citys internal ability to distribute
mundane goods and services which ensure the civilised life of the largest number of its
people.
Fairness is not summed up in Gini coefficients of income inequality, but in access to the
foundational goods and services that all citizens should enjoy.
After 1945, policies for fairness in high-income countries were imagined in a kind of
social democratic frame of redistribution through services and income support, financed
from a progressive tax system. But today, such tax systems are everywhere not within
the realm of the politically possible.
Centre-left and right parties have all now shifted on to managing internal competition
through social engineering, using schools and infrastructure, to redress competitive
disadvantage.
But we believe it is time to think radically about delivering fairness not by redistributing
income or reforming schools, but by re-organising sectors of the economy. We can have
new business models, even if 80% income tax rates are not on the agenda.

Part one: where are we now, and how did we get

here?
Cities are not just what academics pretend them to be. But the narratives and ideologies
of urbanists and sociologists do feed our social imaginary of the city, and in the past 20
years these academics have told a story about possibilities of prosperity through
competitive success.
Since the 2002 release of his bestseller, The Rise of the Creative Class, Richard Florida
has become the acceptable face of a new brand of economic geography. He has provided
countless urban boosters with a legitimating storyline to convince sceptical councillors
and citizens. City branding, high-rise buildings, iconic architecture, expensive hotels,
well-endowed museums, large financial centres, free Wi-Fi and separate bicycle lanes
are the means to future economic success. All this intervention can be seen as steering
and facilitation by new economic geographers such as Henry Overman, for whom
agglomeration makes size itself (through economies of scale and network effects) a
driver of the success of large cities.
City mayors of today are now no longer second-rate politicians who traded a career in
national politics for the administration of city waste collection, street maintenance and
childcare. The big city mayor (in a high-income country) has become the high priest of a
new, weightless, post-national cosmopolitan capitalism Boris Johnson and Michael
Bloomberg have been its prime embodiments.

A 16th century engraving showing Tangier in Morocco

In their post-industrial world, widely dispersed international value chains make a joke
of what counts as national GDP. Manufacturing is elsewhere; warehouses are converted
for economies of apps, big data and latte. Cities with their concentration of nerds,
hipsters and gay people, of culture, creativity and innovation, have turned into the new
growth machines that will determine the economic fate of billions in the 21st century.
And, if thats too strongly cliched and manifestly irrelevant to many world cities, then

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more soberly agglomeration can be built through transport improvement which

extends and connects cities, as the UK chancellor George Osborne now proposes to do in
the north of England.
The worse things get in the early 21st century, the more our thought leaders tell tales
about the possibilities of economic prosperity through competitive success. Against a
background of ongoing financial crisis, the political classes in high-income countries
also insist, at the same time and without apology, on the necessity for austerity cuts. The
two stories are complementary because the pain of austerity living is eased by the drug
of prosperity dreams where the city is reimagined.
Cities were predominantly perceived as a locus of societal problems in the 1960s, 70s
and 80s places of poverty, ghettoisation, crime, drugs, social disadvantage,
deindustrialisation and unemployment. But, since the early 1990s, the story has
changed and the urban has more and more become the answer to all our problems. In a
kind of volte face, the urbanists of today see large cities as the solution to our ecological
problems due to their smaller footprints, as inimical to crime and anomie thanks to
more interaction and social control, and through their higher density of people,
connections and ideas as seedbeds of creativity and innovation, and hence of future
economic growth.
What are cities and what should they be? The urban bible of the 1960s was Jane Jacobs
Life and Death of Great American Cities a passionate defence of the mixed 19thcentury working-class neighbourhoods against the high-rise modernism of Le Corbusier
and Moses. At the time of Jonathan Rabans Soft City, the city was associated with dark
values of doom and menace.
The bible of today, aside from Floridas writings, is arguably Edward Glaesers The
Triumph of the City. This book of 2011 provides a mainstream economic treatise about
the benefits of higher density based on the tenets of Paul Krugmans New Geographical
Economics: the result is a simple, normative argument for high rise and megacities. The
subtitle of Glaesers book How our Greatest Invention Makes Us Richer, Smarter,
Greener, Healthier and Happier brilliantly encapsulates the possibilities of prosperity
that the new urbanists have come to project upon the city.
The possibilities of prosperity tales have diverse origins. But all shared a strong interest
in globalisation as the new, new thing. After the perceived failure of welfare state
capitalism in one country, political elites, with some prodding from big business,
responded to the stagflation crisis of the late 1970s with successive waves of
deregulation, privatisation and liberalisation which disempowered the organised
working class. A new generation of urbanists latched on to this under the rubric of
globalisation, which opened up opportunities in a new field of investigation. With new
concepts, sources of data and methods of analysis, they could criticise or endorse, or
sometimes do both at once.
Like most groups of innovating social scientists, they defined themselves by what they
were against. They argued that nation-states, with their predefined boundaries, were not
the natural, quasi-biological containers of social, cultural, economic and political life.
The city would come to play a crucial role in this conceptual liberation, for it allowed the
new urbanists to break radically with the methodological nationalism of yesteryear.
The geographers could bypass the national by simultaneously conceiving the local and
the global in a relation of mutual co-dependency.
Of course, there were sound empirical reasons for some such reconceptualisation. Data
and anecdotes increasingly showed that a small number of the worlds large cities had
indeed gained disproportionately from the territorial rearrangement of value chains that
was triggered by neoliberalism. It was easy to go one step further and argue that, as
globalisation progressed, these global cities would increasingly house the command and
control functions of finance and the large multinationals that managed the spatially
distributed value chains; the logic was that they would increasingly develop into
transnational jurisdictions in their own right, out of reach of national governments and
national democracies, as globalisation progressed.

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The city of Constantinople 16th century

Saskia Sassens The Global City, from 1991, is an early classic of this kind. It was written
just after the end of the Heisei boom and without anticipation of Japanese stagnation,
so London, New York and Tokyo would be the three regional pillars of post-national
capitalism. It did not matter how new, how structural or robust it all was what
mattered was the announcement of a new order of global city states. This felt about
right, and promised to make sense of a political conjuncture in which nation-state
industrial policy-making was increasingly perceived as bankrupt.
So a new research agenda developed for World/Global City research led by new
urbanists like Sassen, Peter Taylor, John Freidmann and others. They initially built
sweeping statements on sparse empirical foundations, but 30 years later this has
evolved into a powerful performative marketing machine. As well as conferences,
journals, websites, consultants, the new urbanists have their city rankings. Their
rankings are used, maintained and reproduced by a transnational urban growth
coalition consisting of politicians, academics, pundits, civil servants and in particular
real-estate developers, builders, realtors, architects, investors, accountants and
bankers.
London is an excellent example but so is Berlin, New York, Barcelona, Dubai or
Amsterdam. The City Hall on the south bank of the Thames houses the advisers who
help the mayor and assembly with the continuous makeover that is required to keep
London on top of any of the many city rankings which track success. Indeed, everything
needed to beat the competition. This means an advertorial for the mayor here or a new
slogan there; a new interurban collaboration (preferably with a Chinese city) or a new
urban redevelopment project which ostentatiously rebuilds the city; a stream of
initiatives, especially those with global reach like bids for major sporting events.
Unsurprisingly, the city of Manchester has played exactly the same game since it hosted
the Commonwealth Games in 2002.
And of course, this requires new organisational setups, ideally public-private
partnerships, and a strategised approach to city promotion. Old municipalities were
administrative spaces for providing social housing, transport, education, rubbish
collection, public space and other directly useful services; their memorials, for better or
worse, are social housing estates like the gemeinbauten which still house one-third of
Viennas population.
New municipalities have, over the last two decades, spent their resources rather
differently, on the construction of a discursive space of urban neo-mercantilism. In
forums and platforms, politicians, consultants and academics regularly meet to rework
ideas from Glaeser or Florida into a new marketing message through which each city
can promote itself, and indirectly serve citizen interests. Hence the many copies of New
Yorks hugely successful city marketing strategy, INY, with elected politicians and
unelected officials committing taxpayers money to back developers betting on rising
land and property prices as they build everything but social housing.
Increasingly, the dreams of urban prosperity through competition have served to
legitimate hugely costly and publicly subsidised spatial urban interventions in
prestige redevelopment. Real-estate investments to keep the upper-middle classes in the
city, to accommodate a growing army of international students and young service

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workers, to attract major corporates and financial service providers to business parks, to
persuade the hypermobile cosmopolitan creative class to nest locally.
The promises sounded fine because redevelopment projects always offer the prospect of
a revitalised urban economy with more service jobs and taxes paid so that the poor and
vulnerable gain. Take any report, website or paper: unfailingly, public investments in
locations and areas frequented by the upper middle classes campuses, museum
quarters, central business districts are being sold politically with the argument that
the additional employment and tax revenues will ultimately reach the poor and
vulnerable in socially disadvantaged neighbourhoods.
This was ironically called trickle down geography in 2005 by the doyenne of critical
economic geography, Doreen Massey. After the intellectual (and sometimes actual)
bankruptcy of the old-style industrial policies in the 1970s and 80s, after the broadside
implementation of generic competition policies of neoliberal mercantilism in the form
of wage moderation, product and consumer market liberalisation and labour market
flexibilisation in the 1980s and 90s, the trickle down geography of the new urbanists of
the 1990s and 2000s provided national and local elites with a new tool that projected
governmental vigour, and suggested win-win solutions all around: growth and equity,
prosperity and sustainability, competitiveness and emancipation. Urban redevelopment
with public sponsorship and private profit was industrial policy reinvented for new
times.
And so, all our cities took a post-industrial turn and ended up looking increasingly alike.
Each and every would-be international financial centre built its imitation of Canary
Wharf, as in La Dfense in Paris; cities with heritage invested in inner-city museum
quarters, municipalities handed over derelict industrial areas and harbour fronts to
private real-estate developers who have transformed them the world over into the same
kinds of loft apartments and cafe bars while pocketing handsome returns; every
municipality designates some shabby, upcoming areas for artists and/or digital hipsters;
every city builds expensive light railways and metro-networks (which always exceed
budget and rarely get the number of passengers planned); huge investments in
multimodal railway stations promise to resuscitate blighted inner-city areas.
The punishments for cities which failed because they did not or more realistically,
could not take the post-industrial turn were real enough. In a flat world where labour,
knowledge and capital can move across space to where they generate their highest
return, cities have to make sure they attract mobile production factors. If not, they end
up with a wasted economic base and an overconcentration of the poor and vulnerable
which could bankrupt any city: see the fate of Pittsburgh, Detroit or Liverpool. Nothing
new there; capitalism has always moved on and blamed the people and places left
behind. The shock is only that the left behind now include former centres of industrial
prosperity.
But, more significantly, the rewards of success were elusive, narrowly socially
distributed and (despite large-scale commitment of public resources) have never
trickled down for a majority of citizens, who see no benefit from the success of their city
which is celebrated, not examined. The competition for mobile capital has
transformed every would-be global city into a tax haven, eroding real and nominal tax
rates, enhancing global wealth and income inequalities.
Taxes on households are further increased by the way in which big firms benefit from,
but hardly contribute to, the maintenance and renewal of the material and immaterial
infrastructures of our cities. Similarly, the competition between national financial
centres accelerated regulatory capture and contributed materially to lax regulation
before the crisis. Again, the benefits were private and concentrated, while the costs were
public and diffuse.
Finally, success in places like London is associated with the atrophy of social housing
and asset price gains for the well-to-do property owners, turning large parts of the city
into no-go areas for the median income earner, let alone the poor. Susan Fainsteins
2011 book on the Just City shows how the concept of urban justice can be intellectually
reinvented; in practice, justice has been politically undermined by the developments of
the past 20 years.

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Elbing in Prussia 17th century

Part two: finding fairness in the grounded city

How do we reframe the citys potential? Where can we find an alternative imaginary
about something other than competitive success? The fairer city is a good enough ideal,
even though fairness is a peculiarly Anglo-American idea (there is no Italian, French or
German word which can express the evocative and generic English idea of fairness). The
problem is its international unattainability through income redistribution in todays
world.
Income tax rates well above 50% on immobile firms and citizens were part of a post1945 conjuncture in the industrialised countries, when there was political pressure from
an organised working class through trade unionism (and parties aligned with labour) in
a system where the prudent bourgeois were minded to make concessions. We shall not
see high tax rates again in the absence of such conditions. The centre-lefts nostalgic
attachment to redistributive taxation has faded, and all parties now increasingly
problematise fairness as a matter of managing internal competition: the result is
standard packages of policy remedies whose reach exceeds their grasp.
It is time to think more radically, by challenging the assumptions and reversing the
principles of the competitiveness imaginary. On this basis, we propose a new imaginary
of the grounded city, where each city does not compete externally with others. Instead
it reviews its activities, then aims to make locally relevant improvements in its internal
capacity to provide a larger number of people with the basic goods and services that
provide the material basis for social life.
The grounded city is a fairer city delivered through radically different policies, necessary
because the current packages of policy fixes for unfairness are inadequate to the scale of
the problems and their drivers. In centre-right and centre-left variants, these policy fixes
are set in a frame of managing internal competition: the centre-right backs jobs and
schooling as a basis for more equal competition; the centre-left favours an overlapping
package of schooling plus minimum wages and some redistribution through family
credits and such like to compensate for disadavantage. Either way, the conscience of our
competitive age is about equal opportunities through policy remedies which, in our
view, are necessary but not sufficient for a better, fairer city.
Some of the policy novelties are valuable. The new technologies for procedural fairness,
complete with opportunity commissions and policy advisers in city hall, are invaluable
in preventing discrimination on the basis of race, gender and sexual orientation, and
they continue to be necessary. But procedural fairness does not secure substantive
outcomes in high-income countries, where the proliferation of anti-discrimination
policies since the 1970s has been accompanied by sharply increasing inequalities in the
distribution of income and wealth. These inequalities are materialised in all our cities by
residential segregation around hierarchised districts, from the desirable, gentrified
suburb to the sink estate.

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How and why does the concern for fairness co-exist with growing inequality in our
cities? Because the fairer city is so far an aspiration which does not any longer come
with any kind of politically actionable and substantive policy programme that has the
leverage to deliver fairness in terms of broad outcomes.
Fairness in terms of outcomes is, of course, much harder to achieve than fairness in
terms of process on social housing allocation. For example, schools as institutions and
teachers as professionals deserve our social respect and financial support; but there is
no evidence that they are up to the social engineering task of compensating for the many
other kinds of disadvantage generated in the home and within the neighbourhood. The
most likely outcome is that centrist politicians announce the aim and then simply give
school teachers another good kicking for failing to achieve the unachievable.
So if fairness policies in a competitive frame promise more than they can deliver, why
not change the frame by reversing what might be called the principles of operation
underlying the practice of the competitive city?
One master assumption underpins the ideology of competitive cities. Boris Johnson
stated this assumption in his 2013 speech on the relevance of Margaret Thatcher: Like
it or not, the free-market economy is the only show in town. Britain is competing in an
increasingly impatient and globalised economy, in which the competition is getting ever
stiffer.
But this claim mistakes the competitive part of the economy for the much larger whole
which contains many sheltered sectors. It leads Londons mayor and many others
towards city policies focused on sectors of the future which have a supposedly key role
in international competition in tradable goods and services: the corollary is neglect and
mismanagement of what we call the foundational economy, and the sphere of sheltered
production of many other mundane goods and services which are important to the
welfare of every citizen.
The idea of a heterogeneous economy means only that the economy has different
spheres or zones which run on different principles. The historian Fernand Braudel
argued in Civilisation and Capitalism there were not one but several economies from
the 15th to the 18th century, with one economic zone above and one below the market
and competition. Were he writing now, Braudels injunction would be to explore
present-day economic life in ways that recognise its multiplicity and its organisation
into zones and spheres which have different internal logics and variable salience for
material welfare.
The tradable competitive sphere has all the key sectors which associate themselves with
a high-income present and a glamorous future. Here we have wholesale finance and
markets, the prestige end of business services in accountancy, law and consulting,
anything digital or supposedly knowledge-based from media to advertising, together
with the parts of manufacturing which have high tech associations. The object of
competitive global city policy is to attract more of these glamour activities to locate in
their city, adjacent to a hub international airport.
The metal bashing, plastics moulding and assembly work of manufacturing is then to be
relegated to industrial districts and cities which are in the hinterland of an Asian
country, half a world away from the US or Europe. The industrial working class becomes
increasingly Chinese, while the successful post-industrial global city draws in service
workers to meet the needs of the frequent flyers in business class who use the local hub
airport. Tradable goods and services from smart phones to call centres become ever
cheaper without commensurate benefits in well-being and quality of life for city dwellers
in either Asia or California.
Glamour front-end activities of branding and design have the power to subordinate and
claim the profit of assemblers and suppliers; as Apple does at the expense of Foxconns
Chinese workforce in Shenzhen. The effects of such corporate success in western cities
are muted because financialised companies sterilise reserves offshore; and at city level,
corporate success often turns into crowding out (not trickle down), as when Google
workers compete for San Francisco housing.

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In contrast, we seek to define another sphere of the economy, geared to producing

mundane, foundational goods and services that have three inter-related characteristics:
first, they are necessary to everyday life; second, all citizens regardless of income
consume them; and third, they are distributed according to population through
branches and networks. The list of such activities includes: the privatised pipe and cable
utilities together with transport; some traditionally private activities such as retail
banking, supermarket food retailing and food processing; and some traditionally stateprovided activities including health, education, and welfare or social care, which are
now increasingly outsourced. Such activities employ 30-40% of the workforce in all the
worlds cities, yet they figure only as instrumentalities in the competitive city paradigm
because city boosters recognise the competitive city must have infrastructural
improvement.
Against this, we would argue that in Shenzhen or San Francisco, the ordinary citizens
welfare, material well-being and cultural participation all depend very directly on the
provision of an adequate quantum of foundational goods and services which are priced
or de-commodified so that they are accessible to the majority of city population. These
issues about foundational supply are not abolished by economic development, they
only change form: in a Brazilian favela or an African shanty town, the issue will be
absence of sanitation and paying for electricity; in London the issue will be the absence
of reasonably priced family housing for lower-income workers with jobs in the central
city.

Mombasa in Kenya, in the Civitates Orbis Terrarum of 1572

Our argument is simple. If we want fairness, then we should focus on the foundational
economy and reorganise these activities to make them more grounded. This requires
new kinds of policies which build on the naturally sheltered part of the economy and
more or less reverse the operating principles of your local city hall as it has pursued
competitiveness. Here are two new directions and some recommendations for city
policy:
1. Invest unshowily in improving the supply of foundational services in
specific and locally relevant ways (instead of promoting the ostentation of iconic
buildings and grand projects of regeneration which are the same everywhere for
competitive cities).
Symbols are a constitutive element of the history of our cities. All major European cities
have built self-images around symbols, mostly architectural symbols as with
Haussmanns Boulevards and the Eiffel tower which can together stand for Paris. The
ideology of city competition has elevated the symbolic power of architecture to an
extreme degree, but has damaged the symbolic heritage of our cities, filling their
business and residential districts with iconic buildings by starchitects which reproduce
the same styles in different places. The result is a developer-led spectacle of ambition
and competition materialised with no sense of place and history.

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More than 200 tower blocks of more than 20 storeys are presently in planning or under
construction in London and three-quarters of them will be luxury flats; Manchester
council has put millions into the Spinningfields office and financial district. How does
the ordinary citizen benefit from such development? For citizens in present-day cities,
the invisible and foundational economy is far more necessary and salient than highly
visible, iconic additions to the cityscape which make money for developers and produce
look alike cities that fit a generic template in the mind of city hall.
Rather than significant investments in the architecture of ostentation, we need
investment and incremental innovations in what we usually take for granted: the
infrastructure for sustainable transport, the treatment and distribution of drinking
water, underground drainage systems, waste recycling, telecoms and broadband
systems accessible to everyone everywhere, modest but energy efficient family housing
in unremarkable districts with public spaces and services. And to see how all this can be
done in a territorially responsible way by expanding local firm and workforce capability
and improving quality of work.
The logic of this priority is that is that it requires us to engage with the specifics of
infrastructural deficiencies in individual cities. Each city has a bundle of very specific
needs, resources and opportunities: a different topography, a different history, different
levels of income and inequality, a different provision of existing infrastructure. London
is not Amsterdam, Milan is not Johannesburg.
Locally relevant improvements have to be defined without the one-size-fits-all
assumptions of competition: dedicated bike lanes are not an issue in sprawling
megacities or towns built on steep hills. In many low-income cities, access and pricing
for basic utility services is an issue for edge-of-city informal settlements that lack utility
infrastructure and/or require long-distance commuting; in a cold, high-income country
with old housing stock, the priority might be short term measures that alleviated fuel
poverty and longer term issues about financing necessary investments in secure,
sustainable energy supply. In most cities, building or buying social housing and capillary
transport improvement will be objectives which are interconnected physically and in
terms of pricing decisions.
This kind of shift to specifics would not be intellectually or politically easy, because it
requires priority setting and chain thinking about local connections and consequences;
but the shift is attractive because it sidesteps the absurdities of the ranking game. If we
are concerned with the foundational economy in one city, the measure of success is not
primarily an external measure which involves ranking one city against others in
meaningless cross section; the measure of success becomes primarily internal and
temporal.
The question then becomes: to what extent is that city providing (reasonably priced or
decommodified) material conditions of civilised life? For example, take five key domains
of foundational security (housing, utility supply, food, health/social care and education)
and then ask: to what extent are adequate and reasonably priced key services in each
domain available to ordinary citizens and, specifically, how far down the income scale to
median incomes or below does this provision extend? It should be clear that cities which
rank high on global competitiveness often rank low on one or more basic foundational
criteria, as London does on housing. Specifics and time are both crucial because the
basic assumption is that policy is about cities doing do more and better in specific
domains over time to improve the local offer of foundational goods and services.
2. Promote social innovation which meets basic social needs with a learning
government in the leading role (instead of fixating on technical innovation which
promises but no longer delivers diffused benefits from productivity and economic
growth)
Technical innovation was the embodied aim of 20th-century industrial cities whose
suburbs presupposed the motor car and electricity distribution systems; productivity
gain and GDP growth were then measures of our national achievement, on the
assumption that economic gains would be broadly distributed.

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But this assumption is no longer valid in the high-income countries: as Thomas Piketty
has demonstrated, the national macro-economic trends in high-income countries are to
greater inequalities of wealth and income; as the UN concluded in its 2012-13 State of
World Cities cities generate wealth but it is not shared equitably.
GDP growth has no rationale when the benefits are captured by the top 5% of the
population, which in our cities means urban ecologies of residential segregation by
income. We believe the emphasis needs to be shifted towards social innovation that
promotes a civilised, inclusive city which performs fair outcomes in all its decisions. A
city committed to making access to foundational goods and services more widely
available to citizens; and does so, without restricting the privileges of citizenship to a
narrow group, as in Gulf State urbanism.
The social problems we now need to solve in many cities are those such as adult care in
an era of weakening family ties and ageing populations. To our knowledge, no world city
has model arrangements for care of the elderly; their care is a challenge to our ingenuity
and, like the quality of public school meals, a litmus test of our civilisation.
All of this requires financial innovation for social purposes which means
not higher taxes but new forms of taxes to provide an adequate revenue
base.
The competitive city is associated with the race-to-the-bottom, post-1979 incentive
strategy of cutting tax rates (and allowing all kinds of general exemptions, especially in
corporate tax) in the hope of attracting and retaining big business. Instead, the
discourse should be about responsibility when business which draws private benefits
from city expenditure (on everything from education to law and order) so that business
should, in return, pay its fair share of the social costs; and the valuable businesses are
those which are rooted in place and accept their social obligations.
But the answer at this point is not higher tax rates but new forms of taxes which tap the
capital gains and incomes created by urbanism. Because taxation is a social technology
where innovation in forms of taxation has come to a halt after a heroic century of
achievements from 1850-1950 which gave us social insurance, sales tax and income tax
deductions for weekly paid workers. The problem of our own time are not about
financial innovation but about innovation applied for private purposes regardless of
social consequences, as with sub-prime mortgages and other forms of long chain
finance.
The argument must be about how to connect social obligation and fiscal innovation.
There is then no escaping the point that the grounded city needs some kind of land value
tax, for reasons which were familiar to radical Edwardians before 1914 but have
subsequently been forgotten. Urbanism generates increases in the price of land and
property: for the individual land owner, property renter and homeowner, these
increases are an unearned increment arising from social development and the
investments of others, especially public bodies which provide infrastructure. As the city
creates the unearned increment, it is only sensible that the municipality should, through
tax, take some of the value of the increment.
The precondition for mass welfare in the grounded city is a re-invented tax base
intelligently spent on public goods and services which directly benefit the mass of the
population. One implication is that there are limits to single-city policy because there
are places, like Detroit or Liverpool, which have been set problems which cannot be
solved from limited local sources. Cities do not, of course, have a full control of all the
levers.
Another implication is that intelligent use of the levers depends on rebuilding proper
expertise, especially within the tradition of town planning, globally represented by
figures such as the late Sir Peter Hall. But this does not imply the idea that urban
government is in some general sense for planned cities and against the market, only that
the state and planning must take responsibility for some fundamental basics of city
organisation.

http://www.theguardian.com/cities/2014/sep/24/manifesto-fairer-grounded-city-sustai... 30/09/2014

How to build a fairer city | Cities | theguardian.com

Pgina 11 de 11

This implies a shift from seeing the private sector as a source of enterprise
and dynamism to seeing the public and third sectors as a source of
initiative, experiment and legitimacy.
The grounded city is neither an insoluble city problem in the 1970s sense, nor a city
black box in the 2000s sense delivering pleasant surprises. The grounded city is instead
a site of diverse experiments and learning which could and should be publicly led.
Drawing on thinking from science and technology studies, government is about
experimenting; experimenting is about learning; learning is about building on successes
but also about making mistakes; and learning is also about recognising these as
mistakes, and moving on.
We think these experiments have to be led by the public sector because only city and city
region government has the tax revenue base, local knowledge and democratic legitimacy
to require and sensibly lead large scale change. Public sector outsourcing so far, in
sectors like rail operation in the UK, reveals a private sector which is risk averse,
reluctant to commit investment and unlikely to experiment in socially desirable ways;
while private sector capital is hardly necessary if governments at various levels can
borrow and do so more cheaply than the private sector. Against this background, a new
social contract is required, enforced as we have argued elsewhere by a social process of
licensing which enforces corporate responsibility according to local and sectoral
circumstances.
The point of fragility in all this is not the coherence and integrity of our vision of the
grounded city; the question is about whether it is possible to put together a coalition of
city government and civil society to get things done. We live in an era of post-democracy
which has removed many of the pressures on city governments world-wide to act
radically. Hence the lazy default pursuit of competitive success will continue for a little
longer, though not without challenge by a new ideal.
The authors are academics: Ewald Engelen at the University of Amsterdam, Sukhdev
Johal at Queen Mary, University of London, Angelo Salento at the University of
Salento and Karel Williams at Manchester Business School. Sections of this article
draw heavily on the book by Andrew Bowman et al: The End of the Experiment?
(Manchester University Press).

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