Cities are locations of stark inequality
We imagine cities to be lavish, dazzling, with millions of people living in close proximity. Cities espouse particular ways of life -- everyone expects a more modern outlook in everything city-dwellers do. The rate of growth in urbanized life over the last several decades is unprecedent. The world continues to become more urban than before. Today more people live in cities than in rural areas. If the growth rate of city-dwellers continues, the urban share of the global population will surpass 66% in 2050 which was 30% in 1950.
Cities are also the site of stark inequalities as depicted by the growing slums in megacities. There are inter and intra-urban inequalities in economic opportunities/income, housing quality and affordability, residential segregation, public health, and educational facilities.
Jan Nijman and Yehua Wei in a 2020 analysis showed deepening urban inequalities are pervasive across the globe. The extent of inequality is expressed by the fact that, globally, one in six fatal workplace accidents occurs in the construction sites -- some of which are iconic structures of megacities.
While cities stand for growth and development, they also have dark sides that remain out of our sight because of high-rise buildings, flashy lights, big glossy billboards. Thus, I am intrigued to ask: Why do cities continue grow?
Inner connection between capitalism and cities
Geographical and social concentration of surplus products have laid the foundation of urban life. In building a city, land resources are stripped away from the oppressed classes as we always see when cities continue to grow around the world. The process shows an inner connection between the expansion of capitalism and urbanization.
Karl Marx explained: Once the original accumulation is set in motion in a capitalist system, search for “continuous surplus profit” becomes the driving force of capitalism. For a capitalist system to run, it is imperative that there is always a working class having no access to means of production.
The working class has no other ways to make a living except to “sell labour” -- toil hard and long in the production system and to build the megacities of the world. David Harvey has termed this process as “accumulation by dispossession” in The New Imperialism (2003).
There is a paradox in the capitalist profit-searching -- the profit must be reinvested to make more profits in return. There is a perpetual need to find areas for extraction and reinvestment of labour and resource surpluses. Cities as sites of consumption and capital reinvestments employ millions of dispossessed people. Hence, cities have turned out to be the centres of capitalist production systems.
For instance, Napoleon Bonaparte announced vast debt-financed infrastructural projects in 1852 to rebuild Paris and connect it to other countries, which in turn employed people. The construction of roads, rail tracks, ports and harbours, and drainages massively reconfigured the city of Paris. This solved a dual problem; it enabled provision for surplus investment and generated employment opportunities.
Consequently, a new urban lifestyle and a new kind of urban persona began. Paris became the “city of lights” -- a centre of tourism and consumption of different sorts -- creating avenues for surplus absorptions. In the same vein, politicians usually dub Dhaka as the Singapore, Venice, or Paris of South Asia.
More crises and even bigger cities
From the 1930s onwards, there were bigger construction projects every time there were problems of surplus disposal or labour absorption. Following the Great Depression, the US built the biggest dam ever, the Hoover Dam, between 1931-1936. The $49 million project in 1931 created employment opportunities and ensured cash flow in people’s hands to be spent in the market, thus other associated businesses came back to life and cities flourished. In the neo-liberal world, cities thrive with the availability of easy money and as responses to economic crisis.
In a more recent time, easy credit availability created the housing bubble in the US, which eventually caused the economic crash in 2008. Consequently, we have experienced a surge in government spending in China. China undertook unprecedented government-funded projects. The scale was enormous.
During 2011-2013, China consumed nearly 45% more cement than the US had consumed in the entire preceding century.
What did this frenzy of construction entail? With governmental credit support, Chinese companies had undertaken mega projects such as the silk road, high speed railways, mega bridges, and ever larger cities that employed people who had lost jobs due to the financial crash. Moreover, the suppliers of these mega projects had spread an economic rush all over the world. All these efforts were debt-financed, like the Parisian restructuration in the 1850s.
The paradox of capitalism and cities
As cities continue to grow, we tend to fix the economic system and do not really aim to transform it. We do not take notice that the capitalist economic system is inherently crisis-prone. Therefore, we continue to build more unequal cities.
Existing class inequalities of wealth and power are revealed by the existence of a “financial oligarchy” that dominates the world economy. The World Economic Forum in 2017 reported that fewer than 10% of the world’s public companies receive 80% of all profits.
Karl Marx had argued long ago that capitalism as a process is inherently unstable. It will continually produce booms and busts. The profit motive of a capitalist system will always dig its own downfall. The capitalist usually provides the bare minimum wages to the workers who can only spend less and less. Thus, a decline in demand forces many of the capitalists to go bust.
Consequently, unemployment surges up and the capitalist can pay bare minimum wages and generate profit from the market until competition between the capitalists forces another economic breakdown. This boom-bust cycle will continue to roll under capitalism whether the governments around the world intervene and deploy monetary policies or not.
In the biggest of cities, there are many empty houses while many stay home less -- a testimony of the sheer madness running through our socio-political system as David Harvey rightly pointed out in Marx, Capital, and the Madness of Economic Reason (2017).
Cities will continue to grow -- with an ebb during economic crises as we are experiencing now with an outflux of people from cities for the time being -- if we do not tighten the leash of the monster of capitalism.
Mohammad Tareq Hasan is an anthropologist and teaches at the University of Dhaka. This is an introduction to the series: Contemporary City Dynamics.