Concept of the Neoliberal City: San Francisco

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8th Feb 2020 Society Reference this

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This essay will discuss the concept of ‘the neoliberal city’ by unpacking and investigating its readings, evolution and issues, and exploring how and why it is important to refine our understanding to the concept of neoliberalism through the lens of the city of San Francisco in the United States, taking it as a case study for its relevance and quality to my paper.

Introduction:

Neoliberalism has been popularly used in academia, media and politics debate all over the world, especially in the west, to label the system we have been living in for the last 40 years or so. In the economic context, it is widely used to refer to “free” market concept which shapes most parts of our socio-political and spatial aspects in our modern life. From a pure governance perspective, neoliberalism is the shift of the state from being a public welfare and services provider to become a facilitator, supporter and promoter of private markets and entities in which they compete freely to sustain and promote growth (Birch, 2017)

According to Sonia Vives Miró, she defines Neoliberalism as “Neoliberalism is a political ideology that advocates private property, the privatisation of social resources, the flexibilization of regulatory frameworks that might hinder free market values, and the supposed withdrawal of State intervention” (Vives Miró, 2011)

Many scholars who discussed neoliberalism such as Neil Brenner, Jamie Peck, Nik Theodore, Adam Tickell and couple others assumed that the evolution in political, administrative or socio-cultural areas are not the only factors for the socio-political, spatial-governance and economic transformation which had emerged in the western cities since the 70s of the last century. (Pinson and Morel Journel, 2016)

the neoliberalism concept’s roots return to as long ago as 1884 when Ronald Acland Armstrong wrote an article by the name of “the modern review” in which he characterised liberals who support state interventions in the economy by “Neoliberal” although his definition was opposite to what neoliberal means in today’s academic literature. (Birch, 2017)

In the early years of scholar discourse, academics were able to identify the emerging new ideological and political project which was introduced, encouraged and stimulated by influential figures such as the late British prime minister Margaret Thatcher and the US president Ronald Reagan by enforcing of new regulatory plans; however, at the time, no one had branded it or named it as neoliberalism yet. . (Pinson and Morel Journel, 2016)

As the concept of neoliberalism has many different and extended definitions, interpretations and even schools in literature; this paper focuses on one aspect of the concept which relates to the spatial dimension of it and defined under the “neoliberal city.”

The transformation in the modern western socio-economical dynamics towards free market economy has caused significant effects on the spatial form and urban governance in our cities. The Neoliberal City gives an overview of how this shift affects our today’s cities (Hackworth, 2007)

As per the theory of Marxist, it is clear that institutionalist accounts and structuralism approaches both failed to deal with these challenges that were mainly faced by the cities of the United States during 1970’s due to neoliberalism concept.

The term “neoliberalism” was initially used by some international/ first world institutions such as the IMF and the World Bank to describe the practices and recommendations imposed on third world countries an cities. However, as time went by, the term started to roll out in the west as first-world cities are undertaking the same routes (Hackworth, 2007)

Jason Hackworth argues that, in the “Neoliberal City”, neoliberal politics and policies are having significant consequences on the shape, nature and direction of spatial forms in cities and urbanisation in the United States and other countries. (Hackworth, 2007)

San Francisco city is the is the centre of commerce, finance and culture and recently it has been merged as a tech magnet for all the innovative and technology companies. Commercial, and financial centre of Northern Carolina In the united states which once San Francisco as a prosperous metropolis played a vital role in the era of the Gold Rush. In 1900, San Francisco ranked as the 9th largest city in the US (Schwarzer, 2001), despite its difficult geographical location.

According to Davies, San Francisco and other cities in the united states represents crucial arenas for the contestation as well as expression of neoliberal practice and policy (Davies, 2014).

Like in many other cities in the west, San Francisco has swiftly opened its institutions to the new emerging neoliberal project. By the end of the 1970’s, the city’s social, political, urban and environment realm was ripped for the new emerging economic model where afterwards the neoliberalism concept took the helm.

However, according to Lin Zhang, the cities of the USA tended neoliberalism way before the late 70s, and he refers it back to 1940 (Post- Fordism). He adds that the cities back then were considered to be the vital terrains in the contestation and rollout of neoliberalism (Lin & Zhang, 2015).

Recently, the city of San Francisco has been reviewed widely in the press, public researches and academia as it has been seen as one massive metaphor for economic inequality in America with substantial urban crises topped by housing in-affordability and out of control homelessness crises.

According to Frederick Kuo, the dominance of the tech industry and Silicon Valley has driven the city of San Francisco and its region into an unprecedented wealth and innovation but with urban policies and plans which were merely driven by greed and profit had caused the significant city issues with an alarming rise in socio-economic inequality. (Kuo, 2016)

Kuo adds, the technology industry has fundamentally transformed the whole region’s economy where the city became a magnet to big tech companies such as Twitter, Uber, Airbnb, Pinterest and many others because of the soft policies, and tax incentives made by the consecutive local governments (Kuo, 2016).

However, the strength in the job market was accompanied by policies and plans which limits housing development and infrastructure upgrade.

As a result, systematic gentrification, class gap, social inequality, housing unaffordability, homelessness and deteriorating services and infrastructure.

However, back to the context of neoliberalism, How all the mentioned issues of the city of San Francisco’s have to do with Neoliberalism?

Cooksey states that the neoliberal theory provides a framework that mainly captures the importance of both local as well as large-scale forces. In concern to the large-scale forces, the neoliberal theory mainly defines the structural perspective regarding federal retrenchment, market deregulation, public-private venture capitalism, and government cutbacks. On the other hand, this theory also demonstrates the political, social, economic as well as cultural complexion of the city regarding the large-scale.

Forces – in our case – such as the wealthy powerful hi-tech companies. In other words, the author demonstrates that the establishment of neoliberal governmentality theory simply diagnosis the progress of government in the outright domination or correction to bio-political control or self-regulation. (Cooksey, 2017)

Bates thinks, the regime theory of neoliberalism posits that informal and formal arrangement create coalitions of private and public power. These peer regimes understood the urban development and governance about the respective sources and blending of various individuals respectively (Bates, 2014).

According to Wu, San Francisco city depicts neoliberalism as a national economic policy that shifts towards rampant privatisation, the free market of fundamentalism and diminished government. With the help of quantitative examinations of capital flows, qualitative historical analysis, and case studies, scholars or researchers had concluded that neoliberalism effects were generated due to uneven economic development (Wu, 2017).

With soaring rents and unreachable expensive housing, The right to the city of San Francisco for its working class has exenterated by the immense wealth of technology companies, venture capital and neoliberal development.

The city’s politics have shifted dramatically as it becomes controlled and dominated by the interests of the few elites and exclusionary projects.

The city’s model and its service structure have become profit-driven serving those who can afford to cope with the city’s economic and urban new settings.

Starnes argue that the desired ideas about growth which are used by both the local communities as well as the states firmly describe the neoliberal ideology and policy framework and as a result, the globalisation and open free markets are superficially plausible (Bruff & Starnes, 2018)

It is important to mention that one of the central features of the general process of neoliberalism is urbanism (Pinson and Morel Journel, 2016).

Moreover, each governmental tier in the city governance hierarchy plays a role in either promoting, intensifying or extending the role of the market and the margin it rules in urban governance and city politics.

Urban neo-liberalisation is nothing but a cumulative process where the financialisation of the economy, the built environment and urban assets have all become a central and crucial part of the new and current capitalist accumulation. Neoliberalism does not only exist in cities or affect urban governance; cities are mainly fundamental frameworks of neo-liberalisation, provide substantial central bases for this process, but also for its contestation.

 (Pinson and Morel Journel, 2016).

However, how the San Francisco model made us rethink neoliberalism – Fighting Back

The tremendous amount of money pouring in the hands of few in the city have made income inequality un statable and fuels the situation which makes it harder to change the city’s course.

Many see that any condemnation of the activities of the state government acting as a corporate state is nothing but diminishing the role of the governments.

In the same context, a lot of who call them progressive people supports the government’s move as they read this as opportunist governments seizing economic opportunities and stimulating growth. Their argument is if no incentives were given to these giant corporations they can move to any other city or even move countries.

However, Newell and Phillips suggest that the privatisation open arms operations of local government in San Francisco were fundamental to enhance their neoliberal regimes of local governance to rescue the city’s dormant economy that was dominant in the nineties (last two decades) (Newell and Phillips, 2016).

Alec Thornton also suggested that to improve the neoliberal aspect of a city the local government has to suffer from a variety of deficits in other aspects (Thornton, 2017).

Sabrina Alli, says this support is flourishing among those who benefit from this neoliberal model especially tech workers where The “get out if you cannot afford it” mindset is widespread (Alli et al., 2018)

However, San Francisco, even at the era when it adopted more conservative policies, its politics were labelled as radical and racist targeting black American neighbourhoods. However, Sabrina adds today’s crises is much more market-driven, empowered by government policies reluctant and unwilling to put community interests at the centre of public policy. (Alli et al., 2018)

Conclusion:

To conclude, we must agree that governments and states are not victims of neo-liberalisation as they are trying to sell in the name of growth and economic promotion, contrarily, they are the mere responsible for the first vital players of undertaking neoliberal transformations, deregulation and privatisation.

Even though neoliberal thinking regime has been governing in many parts of the world since the seventies, however, neoliberalism has produced great oppositional waves and movements across the globe both within and outside of its remit of thinkers, intellectuals and politics.

In recent years, as a remedy response to the capital finance crises around the globe, especially after the GFC in 2008, urbanisation has become important economic stabiliser and booster at the global scale where real estate development and massive urbanisation have come to play a very noticeable role in the expansion of capital and generating wealth. This caused dire consequences on average citizens and had changed the urban and spatial dynamics in cities.

Defining the neoliberal city has to be pursued by reclaiming the city and fixing its issues must be built by adopting more community centred urban policies with the decommodification of housing and its establishment are fundamental human right are in their core. No one is against the free market with an equal opportunity to all, but at the same time, this free market should not be built on the cost of the urban citizens and the city itself.

Developers, corporates and tech giants are required to pay their fair share back to the city and its inhabitants especially t to affordable housing, contributing to more inclusive urban spaces.

As the course of history teaches us that rights are not granted but claimed, social movements are the key to change urban politics and take actions. Broader community participation, increasing public awareness in addition to active campaigning will all help to create a confrontational movement capable of achieving the necessary reform desired. Such reform, also cannot happen without severe changes in the broader economy of the city and state under the slogan of Cities for People and not for profits.

References:

  • Alli, S., Gittlitz, A., Konczal, M., Readers, S. and Nemser, D., 2018. Resistance in the Neoliberal City. [online] The New Inquiry. Available at: <https://thenewinquiry.com/resistance-in-the-neoliberal-city/> [Accessed 10 Nov. 2018].
  • Birch, K., 2017. What exactly is neoliberalism?. [online] The Conversation. Available at: <https://theconversation.com/what-exactly-is-neoliberalism-84755> [Accessed 7 Nov. 2018].
  • Bruff, I. and Starnes, K., 2018. Framing the neoliberal canon: resisting the market myth via literary inquiry. Globalizations, pp.1-15.
  • Bates, J., 2014. The strategic importance of information policy for the contemporary neoliberal state: The case of Open Government Data in the United Kingdom. Government Information Quarterly31(3), pp.388-395.
  • Cooksey, R.R., 2017. The Treasure Island development project: a case study in neoliberal urban development(Doctoral dissertation, San Francisco State University).
  • Davies, J., 2014. Rethinking urban power and the local state: Hegemony, domination, and resistance in neoliberal cities. Urban Studies51(15), pp.3215-3232.
  • Hackworth, J., 2007. The neoliberal city. 1st ed. Ithaca, N.Y.: Cornell University Press.
  • Kuo, F., 2016. San Francisco has become one huge metaphor for economic inequality in America. [online] Quartz. Available at: <https://qz.com/711854/the-inequality-happening-now-in-san-francisco-will-impact-america-for-generations-to-come/> [Accessed 8 Nov. 2018].
  • Lin, G.C. and Zhang, A.Y., 2015. Emerging spaces of neoliberal urbanism in China: Land commodification, municipal finance and local economic growth in prefecture-level cities. Urban studies52(15), pp.2774-2798.
  • Newell, P. and Phillips, J., 2016. Neoliberal energy transitions in the South: Kenyan experiences. Geoforum, [online] 74, pp.39-48. Available at: <https://www.sciencedirect.com/science/article/pii/S0016718516301646> [Accessed 9 Nov. 2018].
  • Pinson, G. and Morel Journel, C., 2016. The Neoliberal City – Theory, Evidence, Debates. Territory, Politics, Governance, [online] 4(2), pp.137-153. Available at: <https://www.tandfonline.com/doi/full/10.1080/21622671.2016.1166982> [Accessed 6 Nov. 2018].
  • Schwarzer, M., 2001. San Francisco by the Numbers. [online] SPUR. Available at: <https://www.spur.org/publications/urbanist-article/2001-07-01/san-francisco-numbers> [Accessed 11 Nov. 2018].
  • Thornton, A., 2017. “The Lucky country”? A critical exploration of community gardens and city–community relations in Australian cities. Local Environment22(8), pp.969-985.
  • Vives Miró, S., 2011. Producing a “Successful City”: Neoliberal Urbanism and Gentrification in the Tourist City—The Case of Palma (Majorca). Urban Studies Research, [online] 2011, pp.1-13. Available at: <http://file:///Users/lafi/Downloads/989676.pdf> [Accessed 10 Nov. 2018].
  • Wu, F., 2017. State entrepreneurialism in urban China: A critique of the neoliberal city. In Debating the neoliberal city(pp. 163-183). Routledge.

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