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Local autonomy, bond-rating agencies and neoliberal urbanism in the United States
Abstract
The influence of bond-rating agencies on local autonomy is explored in light of recent research which views autonomy not as the degree of separation from the global economy, but rather as the nature of the interaction that places have with the wider politico-economic sphere. Based on the recent experience of American cities, it appears that the activities of rating agencies influence local autonomy more so now than during the immediate postwar period for three interrelated reasons. First, the governing turn away from federally-organized Keynesianism has transferred certain responsibilities to localities that are often funded with debt. Localities are thus more reliant on capital markets and the decisions that determine their access to such markets. Second, an increased presence of institutional investors in the municipal bond market has strengthened the investment-grade threshold because such investors are legally prohibited from holding a high percentage of speculative securities. Localities with speculative-grade debt are less able to sell their bonds than before. Third, commercial banks and locally-based lenders, which used to lend more frequently to cities (based on their own market research), are less involved in municipal debt markets than before. The knowledge vacuum created by their exit has been filled by the only other reputable sources on municipal credit: bond-rating agencies.
... In several cases, such works have associated local government finance with the broader debates on urban governance and financialization (for a recent review, see Aalbers, 2019). Common ground in the literature is the identification of a close connection between the contraction of fiscal support from central governments and the increase in the dependency of cities and regions on financial markets, already observed before the crisis (e.g., Hackworth, 2002;Peck & Whiteside, 2016). A notable limitation is that most studies tend to focus on a single locality, or a set of localities in a given country. ...
... At a basic level, Möller (2015) associates it with the penetration of financial rules, performances and rationalities in local governance. Peck and Whiteside (2016) offer a similar elaboration, highlighting the increased influence exercised by intermediating financial institutions, such as credit rating agencies, upon local governments (also see Hackworth, 2002). O'Brien and Pike (2019) corroborate these authors, while also underlining the social and spatial variegation in the unfolding of local financialization processes. ...
... The literature commonly identifies reduced fiscal support from central governments and the introduction of fiscal discipline to the budgets of local governments at the root of the financialization of local governance. This is a long-standing observation in the context of the United States, with several researchers pointing out cuts in federal grants to state and local governments already since the 1980s (e.g., Cropf & Wendel, 1998;Hackworth, 2002;Peck & Whiteside, 2016). In more recent years, scholars have made similar observations in the context of Europe (e.g., Christophers, 2019;Lagna, 2015;Möller, 2015). ...
This paper analyses the development of sub-sovereign debt in the Eurozone, based on a sample of 58 regional and municipal governments for the period 2004–17. The findings show that when examined from the prism of sub-sovereign debt, Eurozone countries cannot be readily divided into core and periphery, as conventionally done nationally. For many countries, a significant domestic variegation in local economic conditions is identified. Driving forces in the rise of debt positions are also varied. Despite such variegations, the analysis also confirms the overarching role of national governments in setting the fiscal and financial boundaries within which local governments operate.
... The "downloading" of responsibility and concomitant reduced fiscal support has put increasing pressure on local governments (Hinkley 2017) to finance more of their activities (Hildreth and Zorn 2005). This need was matched by growth in demand for municipal bonds by "yield-seeking capital" (Weber, 2010, 251; see also Johnson and Man 2001;Weber 2002) and a related monitoring of government borrowing by credit rating agencies (Hackworth 2002). The overall picture of post-Reagan entrepreneurial municipal borrowing is therefore one of growing capital need (from cities) and their associated disciplining by financial and state actors. ...
... Intensified municipal reliance on capital markets in an era of entrepreneurial urbanism is often illustrated using the overall growth of the municipal bond market, as part of the wider financialization of urban policy and practice (e.g., Hackworth 2002;Fields 2015;Lake 2015;Peck and Whiteside 2016;Aalbers 2020). There is disagreement, however, over how to interpret the last four decades of growing municipal reliance on capital market borrowing. ...
... Analysis of municipal debt in the geographical literature tends to focus on the role that borrowing plays in urban governance (Hackworth 2002;Weber 2010;Peck 2014;Fields 2015;Lake 2015;Peck and Whiteside 2016). The size of the U.S. municipal bond market is often used to indicate the more significant role of debt in urban governance (Peck and Whiteside 2016;Kim and Warner 2018). ...
Borrowing from capital markets has a long history in U.S. urban government. With federal authorities withdrawing fiscal support since the 1980s, U.S. cities have become more entrepreneurial and increased their reliance on borrowing. Some now claim that this reliance has grown since the Great Recession. Despite the significance of borrowing to U.S. urban governments, municipal indebtedness remains a relatively understudied topic within geography. This article examines post–Great Recession indebtedness changes (2006–2016) in the general funds of U.S. municipalities. We show that general fund indebtedness has not generally increased since the Great Recession, although a complex landscape of divergent borrowing and indebtedness is evident across cities with different populations. The article uses the Government Finance Database to collect and analyze U.S. Census Bureau data on municipal debt and budget health. We conclude by discussing the need to develop existing theories of postrecession urban governance to examine emerging debt and budgetary challenges across U.S. municipalities.
... Urban infrastructure holds a central and longstanding position in urban governance research. This is because the local state plays a key role, alongside other actors, in the provision of collective consumption goods and infrastructural services to enable economic and social activities in urban areas (Hackworth, 2002;Jonas et al., 2010). The state retains this integral role in infrastructure to underpin capital accumulation due to its large-scale capital investment requirements, long-term time horizon, monopoly and competition issues, externalities and other market failures -all of which call 'for some combination of finance capital and state engagements' (Harvey, 2012: 12). ...
... These strands included: the urban political economy of neoliberalism and state rescaling (e.g. Brenner, 2003Brenner, , 2004Hackworth, 2002;Peck et al., 2013;Raco and Gilliam, 2012;Ward, 2011); the rise of the 'entrepreneurial city' marked by speculative economic renewal and heightened socio-spatial inequalities (e.g. Boyle and Hughes, 1994;Jessop, 1997;Leitner, 1990;MacLeod, 2002); and, recently, the emergence of austerity, financialised and speculative urbanisms (e.g. ...
... It was missing important national and local aspects of the 'modern infrastructural ideal' (Graham and Marvin, 2001: 43), including: direct mostly national government roles in planning, funding, financing and delivering infrastructure; the construction of centralised, monopolised, standardised and equalised national infrastructure systems; and the demonstration of national state power and geographical widening of social access to services, employment, modernisation and societal progress (Graham and Marvin, 2001;Helm, 2013). Much of the research on urban governance transformation has been undertaken in decentralised states (e.g. the US, Canada and Australia) (Hackworth, 2002;Ward, 2011). Mature, centralised states such as the UK with established governance systems, central-local relations and public finance arrangements require more attention to examine transformations or their absence in the current period. ...
How urban infrastructure is funded, financed and governed is a central issue for states at the national, city-regional and city scales. Urban infrastructure is being financialised by financial and state actors and transformed into an asset in the international investment landscape. Local governments are being compelled by national state and financial institutions to be more entrepreneurial in their infrastructure funding and financing and to reorganise their governance arrangements. This article explains the socially and spatially uneven unfolding and implications of urban infrastructure financialisation and local government attempts to implement more entrepreneurial practices and governance forms. The empirical focus is the City Deals in the UK: a new form of urban governance and infrastructure investment based upon negotiated central–local government agreements on decentralised powers, responsibilities and resources. The continued authority of the highly centralised UK national state, its managerialist institutions and conservative/risk-averse administrative culture have constrained urban infrastructure financialisation and entrepreneurial urban governance in the UK City Deals. Situated in their particular spatial, temporal, political-economic and institutional settings, financialisation is understood as a socially and spatially variegated process and urban governance is interpreted as the articulation and mixing of new entrepreneurial and enduring managerialist forms.
... To stay ahead of the curve (for some local governments, to keep up with the curve), the overarching goal is to manage available resources effi ciently. At the same time, local governments must manage their capital fi nancing function under the conditions of ever-growing responsibilities and chronic fi scal stress (Carroll, 2008;Hackworth, 2002;Kirkpatrick and Smith, 2011;Nunn and Schoedel, 1997). 2 Kasdan (2016) warns that under the conditions of continued fi scal austerity, there is a greater need for "a strategic approach to the administrative side of fi scal distress management." We argue that one such approach to fi scal management would be a more proactive and continuous practice of managing the method of bond sale for capital fi nancing. ...
... This is particularly true for unrated or lower rated city and county governments. Alternatively, as credit ratings became an important part of state and local government markets (Hackworth, 2002;Moldogaziev and Guzman, 2015;White, 2010), fi scal administrators must have a strategic approach to managing the fundamentals of their underlying credit quality (Palumbo and Zaporowski, 2012). Such management of credit fundamentals is not necessarily an easy task, where some core factors, such as the national or regional economy or state level fi scal and legal institutions, may be "uncontrollable" by municipal governments. ...
Local government competitive debt auctions often occur in a fi rst-price sealed-bid format in which (underwriters) fi rms submit their bids and the bid with the lowest interest cost wins the auction. Implicit in competitive auctions is the assumption that they are always "competitive. " Focusing on the role of information factors in auctions, this paper investigates the variables behind competition intensity in city and county fi rst-price sealed-bid competitive auctions and identifi es a set of important "product" (debt) features and "common information" covariates. These results offer decision tools to municipal government fi scal offi cers seeking to more ef-fi ciently administer their debt management function. Signifi cant interest savings can be realized by actively structuring and timing debt sales toward an "optimal" threshold number of required bids in competitive auctions.
... Much of this work (the most common examples being urban regime theory and growth machine analysis) has drawn from and extended the theoretical foundations discussed above in order to consider how capital mobility has changed the character and outcome of urban politics and development. The typical conclusion, at least from critical theorists, is that enhanced capital mobility has resulted in a regulatory "race to the bottom" as different places use tax abatements, subsidies, debt-financing, reduced labor and environmental standards, and other strategies to compete with one another for mobile capital investments (Hackworth, 2002;Peck and Tickell, 2002;Williamson et al., 2003;Peck, 2004). By dedicating valuable resources to the attraction and maintenance of capital, interurban competition limits progressive development agendas (DeFilippis, 2004) and generally undermines progressive urban politics: ...
... Whereas flexible specialization leads firms to seek flexible location patterns, the denationalization of the state places great responsibility for urban development on subnational political entities (MacLeod and Goodwin, 1999). And because cities can no longer depend on the national state (e.g., through federal grant programs or dedicated funding for social programs) to ensure their economic viability (Eisinger, 1998;Hackworth, 2002;Lake, 2002), they must find new ways to generate or maintain local economic activity. Thus, one important result of the regulatory changes that emerged in the 1970s with the breakdown of Fordism and continued to unfold through neoliberal development policies is increased spatial competition among cities vying for favorable, or even just viable, economic activities. ...
This article considers why urban scholars have made relatively little progress in recent decades in the identification and advancement of strategies for challenging the mobility of capital. It is suggested that the lack of progress is due, in part, to the failure of urban researchers to critically examine the politics of capital mobility. Politics is emphasized over other factors because an overemphasis on technical conditions and economic considerations has led to the "naturalization" of capital mobility and the depoliticization of the relationship between capital and place. Here the focus of critical inquiry is shifted onto the politics of capital mobility by examining how the mobility of capital has been naturalized by critical researchers in geography and related disciplines, and by exploring how alternative research agendas that challenge the assumption of capital mobility repoliticize the place-capital relationship and enable new forms of urban political research and practice.
... Guironnet, Attuyer, and Halbert (2016) also focus on the entanglements between financial capital and the built environment, reporting a case of a large-scale redevelopment project in the French municipality of Saint-Ouen where the expectations of investors are met at the expense of the local authority's agenda. Each of these studies demonstrates that urban redevelopment is shaped by an increased dependence of local governments on property markets, which has significant implications for the financial risk of land development for local governments (see also Guironnet and Halbert 2015;Hackworth 2002). Furthermore, local governments may take care of collateral management when unforeseen yet inevitable events occur, such as macroeconomic turning points. ...
Internationally, brownfield regeneration projects are delivered through public-private partnerships that form complex legal and structural delivery mechanisms. Utilizing private-sector finance and skills is an accepted practice to reduce financial risk for the public sector while delivering profits for the private sector. This article explores three international brownfield regeneration schemes. It highlights how and why financial risk remains within the public sector from the outset or returns to the public sector over time, despite the initial rhetoric for this burden to be carried mainly by the private sector. The analysis improves the empirical understanding of financial risk dynamics in brownfield regeneration.
... Additionally, most governments have witnessed extensive funding cuts over the past three decades, leaving them with a fraction of the capacity they once had to deal with an increasingly complex array of public responsibilities. Local governments tend to be the most affected by these fiscal constraints, with the push to decentralize resulting in massive un(der)funded mandates, as higher tiers of government move to reduce their own deficits (Beard et al., 2008;Hackworth, 2002;Newman, 2014). Conflicts between different levels of state, for various reasons, have made matters worse, confounding problems of a lack of transparency, limiting forms of accountability and creating overly bureaucratic processes and frustrated public sector employees. ...
Critically assessing meanings of the term “public”, this book situates the emergence and expansion of “public services” within market-based forms of production and consumption.
It highlights the potential for making public services more progressive within market societies, but underscores their ongoing capture by private interests and emphasizes the inherent limits of reform within a “bourgeois public sphere”. The author explores opportunities for more expansive forms of non-marketized public services, examining emerging debates on the theory and practice of equitable, participatory and sustainable forms of publicness that go beyond mere ownership. The book then asks how we can build a robust international “pro-public” movement that juggles universal needs with local context.
With a focus on essential public services such as water, electricity and health, the text is global in its scope and written for a broad audience. It will be useful for those interested in social and public policy, public services and public administration, political theory, economic geography, social movements, sustainability and development.
... At the municipal level, the project of financialization has resulted in a new alignment of infrastructure, housing, and urban (re)development with financial market interests (Beswick and Penny, 2018;Pike et al., 2019;Waldron, 2019;. It creates new bonds between local budgets and global finance through the use of new financial products (Hendrikse and Sidaway, 2014;Lagna, 2015;Mertens et al., 2019;Peck and Whiteside, 2016), the establishment of debt management policies (Deruytter and Möller, 2020), and the disciplinary power of rating agencies (Hackworth, 2002;Omstedt, 2020). Under financialization, entrepreneurial practices of local governments are increasingly separated from traditional strategies of local growth politics (Lauermann, 2018) and reshaped by financial market logics. ...
Over the past decade, a tide of financial analyses has washed over the African continent. These reports by international consultancy firms predict fundamental economic transformation, or “Africa Rising,” a slogan that signifies an emergent middle class and investment-ready domestic consumer markets. However, in promoting the Africa Rising narrative, the consultancy firms also have directed attention to the role of the private sector for public financing. This chapter illustrates that process through a specific example: the securitization of remittances. By recasting remittances as future flow receivables, African states claim increased foreign exchange reserves and thus improve sovereign credit ratings. This financial technique allows governments to access foreign capital markets by issuing sovereign bonds based on asset-backed securities, thus bypassing channels of public credit, such as multilateral foreign aid. The international consultancies serve as intermediaries in this network of migrants, local development banks, and international institutional investors, leading to new forms of debt-financing.
... The situation leads to an amplified influence of financial logics and technocrats on urban governance (Peck and Whiteside 2016;Dimitar, Leitner, and Sheppard 2018). It gives rise to, for instance, the formidable power of financial gatekeepers like private creditrating agencies in (re)structuring cities (Hackworth 2002). ...
This article examines the contingent and contentious processes through which debt is created to finance major infrastructure projects. I contend that practices aimed at structuring credit relations into debt-financed projects often have important, unexpected, and under-recognized implications on the ground. My argument is illustrated through an analysis of the cascading impacts resulting from the making of a China–Lao sovereign debt agreement to fund the trans-Laos railway, an infrastructure project that is part of the broader Belt and Road Initiative (BRI). The failure of the government to deliver the promised credit on time had multiscalar financial ramifications. Chinese enterprises that had been contracted to implement the railway were coerced into funding construction themselves, and the ensuing financial turmoil exacerbated the exploitative conditions experienced by construction laborers. As Lao laborers sought to resist exploitation in the form of delayed and denied wage payments, they were gradually substituted by their more vulnerable Chinese counterparts. Dynamics in the making of BRI-induced Lao sovereign debt therefore rendered some perceived beneficiaries of the interstate financial arrangement, such as Chinese enterprises and workers, its victims. I argue that the contradictory realities of this high-profile financial deal demonstrate the need for more grounded inquiries into the politics of sovereign debt making.
... The situation leads to an amplified influence of financial logics and technocrats on urban governance (Dimitar et al. 2018;Peck and Whiteside 2016). It gives rise to, for instance, the formidable power of financial gatekeepers like private credit-rating agencies in (re)structuring cities (Hackworth 2002). ...
... The value of prioritizing financial condition, even when it conflicts with an institution's public mission, is normalized through the discourse of good financial management. It is also reinforced by credit rating agencies and bond market participants, which act as powerful forces governing public institutions' actions (Hackworth 2002). In January of 2013, shortly after the CHA paid down its long-term debt with reserves, Standard and Poor's (S&P) gave the CHA an AA rating and said that the rating was a reflection of its "stable net operating income and cash operations, extremely strong debt and liquidity profile, and top-tier profitability among rated U.S. public housing authorities" (Shields 2013, n.p.). ...
In this article I discuss a methodological approach I refer to as “critical financial analysis,” which blends critical theory with public finance tools. As geographers and other scholars have documented, there have been profound shifts in urban governance over the last three decades (Harvey 1989; Brenner and Theodore 2005; Hackworth 2007; Whiteside 2018). The squeezing of public budgets and tax restrictions, compounded by the 2007–2009 recession, have pushed municipal governments to look for cost-saving measures, seek out creative financial resources, and engage in entrepreneurial activities (Sbragia 1996; Weber 2010; Ashton, Doussard, and Weber 2014; Beswick and Penny 2018). While a robust and growing body of work on financialization exists, the state’s role in financialization (as an initiator and innovator, not just passive facilitator) is an emerging area with fewer studies to date (Aalbers 2017; Beswick and Penny 2018). Critical financial analysis is one approach that can be used to help fill gaps in the literature in light of these shifts. Critical financial analysis operates from the premise that financial data is a “field site” through which contested spaces, practices, and power relations can be explored.I illustrate my approach and its potential using a case study of the Chicago Housing Authority (CHA). The CHA example highlights the type of rich information that can be obtained by conducting detailed financial analysis. It demonstrates how empirical data combined with critical theory can be used to probe how public finance functions as a technology of power, and how particular finance logics can orient public institutions away from their social missions. Such work can help deepen our understanding of urban governance, and illuminate how macro processes intertwine with locally specific histories, political-economic conditions, and material realities.
... The growing dependence on bond markets to fund urban development and city operations has encouraged municipal politicians and bureaucrats to internalize the evaluative metrics of capital market gatekeepers, like Moody's and other rating agencies, in order to preserve bond market access and keep the cost of borrowing down. As Hackworth (2002) showed a decade and a half ago, the increasing presence of riskaverse institutional investors and fewer locally-based lenders in the municipal bond market has made it harder for cities with low credit ratings to sell their bonds. This imperative to internalize financial logics is itself a sign of financialization (i.e. the financial subjectivization of the city), but bond-market discipline is just one of the many factors that have attuned cities to the investor's gaze. ...
The financialization of urban development occurs even under conditions of credit constraint. The paper demonstrates that credit scarcity is an important and under-examined driver of policy improvisation and institutional development. Using the case of Tucson, Arizona, we show that local and extra-local interests overlap and cross-pollinate to produce unique hybrids – geographically specific and contingent institutional forms cultivated by local growth machines to attract outside financial interests. These dynamics are illustrated with a sales-tax-based tax increment financing district that employs “enhanced financings” to attract extra-local sources of debt and equity. We find that the financialization of urban development in the credit-constrained city is not just a process of abstraction, but also of particularization in which extra-local dollars flow through embedded local networks. We conclude with a call for greater attention to the intersections of finance and urban life in “ordinary cities”.
... It is only in a limited number of instances, and mostly in Anglo-American contexts, that FPIs received in-depth attention, usually because they are set up and/or put to use by local governments themselves. This is the case of some Public Private Partnerships dealing with the provision of urban services (Allen & Pryke, 2013;Ashton et al., 2016;Torrance, 2008) or of financing tools like Tax Increment Financing, redevelopment bonds, or municipal bonds (see respectively, Gotham, 2016;Hackworth, 2002;Weber, 2010). In these cases, actors belonging to financial markets, like rating agencies, investment banks or institutional investors, play a growing role in shaping urban policies (ibid.). ...
Focusing on the growth of Real Estate Investment Trusts in Brazil, the paper explores how financializing policy instruments intertwine financial markets and the urban built environment. It studies the career of REITs and questions the role of financial market capital and actors in urban dynamics. The paper uncovers three processes usually considered separately: i) how a network of public and private financial market actors coaxes state bodies into using their regulatory powers and financial resources to transform real estate into an asset class; ii) how the government-run financial market authority and banks lure urban households into liquid real estate through marketing and education campaigns; and iii) how asset managers are “applied economic geographers” insofar as they channel households’ capital into a selected cities and properties. The active role played by financial actors in the design, enhancement and implementation of such a policy instrument leads us to conclude on their role as urban policy-makers.
... Top-down austerity policies can be said to be one of the key drivers of financialization at lower and subordinated levels of government. In the case of US cities, recourse to capital markets through revenue bonds and TIFs became commonplace when fiscal federalism reduced transfers to state and city governments (Hackworth 2002) and as state governments moved to curtail the power of city governments to raise local taxes (Davidson & Ward 2014). In the UK context, the Hammersmith & Fulham derivatives debacle in the early 1990s occurred in large part because of Thatcher's rate-capping and Rate Support Grant controls and reductions (Tickell 1998). ...
This article introduces a new mode of urban entrepreneurialism in London through a study of the state‐executed, speculative development and financialization of public land. In response to an intensifying housing crisis and austerity‐imposed fiscal constraints, municipalities in London are devising entrepreneurial solutions to deliver more housing. Among these ‘solutions’ can be found the early signs of the state‐executed financialization of public housing in the UK with the use of speculative council‐owned special purpose vehicles (SPVs) that replace existing public housing stock with mixed‐tenure developments, creating ambiguous public/private tenancies that function as homes and the basis for liquid financial assets. Drawing together parallel literatures on the financialization of urban governance and housing, and combining these with original empirical research, we situate these developments in contrast to earlier modes of governance, identifying a distinct mode of entrepreneurial governance in London: financialized municipal entrepreneurialism. The local state is no longer merely the enabler—limited to providing strategic oversight of the private sector—but financializes its practice in a reimagined commercialized interventionism, as property speculator. This article concludes that while the architects of this new mode of entrepreneurialism extol the increased capacity and control it provides, any such gains must be set against longer‐term financial, democratic and political risks.
... Questions of finance have long circulated in scholarship on urban entrepreneurialism and neoliberal urban governance, questions that municipal authorities confront as they strategize about attracting investment towards, or stimulating it within, their jurisdictions. Responding to this, scholars worked to identify the financial instruments and practices mobilized to promote local economic competitiveness (Leitner, 1990;Sbragia, 1996;Hackworth, 2002). Over the past two decades, however, the ever-expanding penetration of financial capital and interests into multiple spheres of socioeconomic life has profoundly deepened the complexities of finance. ...
Urban entrepreneurialism and neoliberal urban governance are assuming new forms under finance‐dominated accumulation. We examine and contribute to theorizing the mechanisms through which urban governance is financialized, taking as a case study JESSICA, one of the European Union’s initiatives to implement an ‘urban sensitive’ policy for sustainable and integrated development. Like other initiatives promoting financialization, JESSICA deploys the logic of finance to select and fund urban social initiatives and development projects on the basis of their potential return on investment (ROI). Understanding this process requires placing questions of political economy—how urban governance is shaped by the broader political‐economic context—with questions of governmentality—how stakeholders are enrolled in and come to take for granted new governance initiatives. Following the multi‐scalar institutional infrastructure is crucial to understanding how this works. Taking a relational multi‐scalar approach, we trace how changes at the supranational scale filter down to shape urban policy selection and performance in Sofia, Bulgaria, where we document how ROI calculations conflict with social welfare priorities. Contrasts between the trajectory of financialization of urban governance in the European Union and the United States demonstrate how this is geographically variegated, shaped by the broader context/conjuncture within which such financialization is embedded.
... Local authorities' strategies for asset management are also influenced by a growing suite of supra-local and global institutions (such as the EU, the IMF, the World Bank; see Hackworth, 2002) that regulate the structural conditions under which they can operate actively as investors or as recipients of investment. ...
... As noted earlier, this was the time when neighborhoods and regions viewed as chaotic, dangerous, blighted, or insecure provided both financial opportunities and perceived physical and/or financial risks (Weber 2002). If these areas posed impediments to tourist activity, capital investment, or the formation of an attractive milieu that might draw members of the creative classes, they were seen as risks to the broader entrepreneurial strategies of capital accumulation, as well as the related financial instruments and institutions measuring and assessing these strategies, such as bond-rating agencies (Hackworth 2002). But at the same time these risks could become opportunities-the opportunities of urban renovation and gentrification, but only if a neighborhood's risky populations were evacuated, controlled, banished, incarcerated, or otherwise removed or rendered surplus. ...
In recent years social scientists have been interested in the growth and transformation of global cities. These metropolises, which function as key command centers in global production networks, manifest many of the social, economic, and political tensions and inequities of neoliberal globalization. Their international appeal as sites of financial freedom and free trade frequently obscures the global city underbelly: practices of labor exploitation, racial discrimination, and migrant deferral. This chapter explores some of these global tensions, showing how they have shaped the strategies and technologies behind urban crime prevention, security, and policing. In particular, the chapter shows how certain populations perceived as risky become treated as pre-criminals: individuals in need of management and control before any criminal behavior has occurred. It is demonstrated further how the production of the pre-criminal can lead to dispossession, delay, and detention as well as to increasing gentrification and violence.
... The process of gentrification has been further lubricated by the invention of new financial instruments, which enable rapid investment of capital into property without proven productive or consumptive value (Hackworth 2002). ...
Maine hosts numerous small fishing villages that contribute greatly to the States economy and culture. The cumulative effects of state and federal regulation, stock depletion and other socio-economic trends threaten these communities. Drawing on ethnographic research and interviews, we examine how gentrification is affecting the vulnerability and resilience of fishing communities. This study has revealed gentrification to be a complex process, which is merely the most readily recognizable symptom of forces that are reshaping the post-industrial landscape. Fishing communities can no longer be thought of as discrete entities isolated from broad social and economic changes. Technology and new markets have unleashed fishing effort from its artisanal restraints, likewise they have enabled capital to expand beyond metropolitan barriers. Findings indicate that a rural restructuring has occurred and amenity migrants are being drawn to these communities. These people from away increase demand for services otherwise not provided and present new economic opportunities for community members and fishermen. However, as wealth migrates out of its metropolitan centers into these communities, it threatens to transform and displace productive economies with service economies. These trends may be beyond the capacity of fisheries management to account for, but policy makers should recognize their cumulative effects. The vulnerability framework readily provides a means of assessing fishing communities and the impact of gentrification on them. The characteristics of gentrification are unique for each community, though a few themes are prominent. Rather than being an entirely negative influence, gentrification can provide benefits for the community. Nevertheless, displacement of both people and the fishing industry may occur. The increased cost of living and process of gentrification is displacing many fishermen and community members from coastal property. Further conflicts arise when fishing operations and access to the waterfront is impeded. It is apparent that when facing the threat of displacement there is much that can be done at the state and municipal level in supporting access to the waterfront.
... Works on urban redevelopment projects and actors have highlighted the role of financial markets in providing capital (Guironnet & Halbert, 2014;Rutland, 2010;Savini & Aalbers, 2015;Theurillat & Crevoisier, 2012). Partly related to this, studies on public finance have explored the mounting dependence of US municipalities' budgetary capacity on capital markets (Hackworth, 2002), including due to local governments' own proactivity (Weber, 2002. Lastly, housing studies have linked the changing political economy of housing in a number of countries to a two-pronged financial shift: i) from direct public subsidies for housing production to increased reliance on private investments; and ii) from traditional savings and loans banking finance to securitized mortgages (Schwartz & Seabrooke, 2008), as epitomized by the 'subprime city' (Aalbers, 2012). ...
A distinctive feature of urban spaces lies in their high infrastructural density. Because buildings, roads, stadiums, airports are all capital-intensive, they rely in turn on financial infrastructures that circulate not passengers, power or data, but capital more or less temporarily fixed in the urban built environment (Harvey, 2001). Like many infrastructures (Edwards, 2003), financial ones remain invisible to most but for cases of major disruptions. Think, for instance, of how the subprime crisis revealed the interconnection between households’ mortgages and capital markets. This relative invisibility should, however, not obfuscate the importance of financial circuits in the design, construction, exploitation and ownership of the urban built environment (‘urban production’ from here on).
Researchers in urban studies unevenly pay attention to financial circuits, understood here as the sociotechnical systems that channel investments in the forms of equity and debt into urban production. Major accounts of city-making under neoliberalisation from the 1990s and 2000s are a case in point. Such studies mainly focus on evolving rationales for public intervention and the resulting changes in public actors’ modes of operation where welfare provision gives way to entrepreneurial policies (Harvey, 1989; Moulaert et al., 2003; Tasan-Kok and Baeten, 2012); the growing importance of private investments and the concomitant reconfiguration of public spending is mostly acknowledged as a contextual factor, while the ‘private investors’ and ‘international finance capital’ targeted by public authorities remain in the background of analyses. There is thus a dearth of conceptualisation and of evidence on how private financiers and investors, collectively or individually, shape or adjust to this new context and on the role played by those acting at the interface between public and private bodies. It is thus important to go beyond simplistic analytical distinctions, such as ‘public subsidies’ versus ‘private investments’ and to scrutinise financial circuits as relevant …
... In this sense, the rise of entrepreneurial local politics resembles the spread of innovative financial market instruments used by municipal governments and the assumption that both processes are connected appears quite obvious. So far, however, the theoretical and empirical literature has rarely acknowledged this relation (with the exceptions of Hackworth 2002 andPetzold 2014). In order to explore the actual relationship between the financialisation of local governance and the rise of entrepreneurialism in particular cases of municipal derivative purchases one has to further operationalize both concepts. ...
In recent years, city budgets have become much more connected with global finance in many countries through a wide range of speculative financial market activities including, amongst others, the purchasing of derivatives like interest rate swaps. Far from just being a technical alternative or supplement to traditional bank-based financing of public debt and spending, such products connect local institutions and trajectories with rules, performances, and rationalities of global financial markets and, therefore, drive the financialisation of local governance. This process, however, is not just a local story since transnationally organized private service suppliers play an important role in the promotion and implementation of municipal derivative purchases. The paper sheds light on the emerging market for speculative municipal finance, reviews the respective literature and presents initial empirical findings on the case of Linz (Austria), where the local government agreed on a swap deal with the regional bank BAWAG-PSK that caused huge losses for the city budget and ended in front of court. It shows that the main motivation of the local administration in the Linz case was to hedge against interest and exchange rate volatility arising from previous foreign currency loans. This demonstrates the self-reinforcing character of the financialisation of local governance. Moreover, the legacy of the bank as traditional house bank of the city and the social relationsships between public and private actors fostered the swap deal. After all, more comparative research on financial market activities of municipal governments and a conceptual debate on the financialisation of local governance are needed. Financialisation of Local Governance (Sebastian Möller) 2 Content
... If residents are disinclined to make the concessions necessary to remain competitive, or if local officials are otherwise unable to enact the appropriate business-friendly policies, they will be compelled to do so through the threat of rating downgrades. 64 A second important intermediation involves the relationship between bond underwriters, municipal advisors (and other economic development professionals), and local officials. Over the last two decades, it has become increasingly common for these parties to enter into a negotiated sale of newly issued bonds. ...
Numerous U.S. cities suffered immense fiscal strain following the subprime mortgage crisis and financial crash of 2007–8. Diminished revenues, tightened credit, and speculative financing that went bad in the aftermath fueled widespread fiscal distress on the local scale. Although the current moment resembles fiscal crises that crested in cities in the 1970s–90s, two factors distinguish the current period. First, municipal affairs have become thoroughly financialized—dominated by speculative securities and volatile debt arrangements—such that local crisis can no longer be understood apart from financial market instability. Second, local fiscal politics have become increasingly removed from democratic oversight and control. This de-democratization hinders the capacity of political communities to reregulate markets and rebuild urban communities. An analytic model derived from the work of Hyman Minsky and Karl Polanyi emphasizes how cities become ensnared in a “financial instability” cycle and how communities seek to protect themselves by way of the “double movement.”
... First, the evolution of public financing of urban development. Following a decrease in central State's grants, the dependence of municipal budgets has shifted towards capital markets since the 1970s, especially in the U.S. case (Kantor and Savitch 1993;Hackworth 2002). This funding gap would have resulted in local governments to devise ever-sophisticated instruments, such as Tax Increment Financing which allows them, with the help of financial brokers and consultants, to finance urban redevelopment through the securitization of future fiscal income (Weber 2010;Pacewicz 2012;Strickland 2013). ...
This paper pleads for revisiting Urban Development Projects (UDPs) in the light of the financialization
of the urban built environment. If the rising integration of the urban fabric and financial
markets has been acknowledged, it remains incidental to most of the literature on UDPs. The restructuring
of the built environment (real estate, infrastructures) into bundles of assets provided
for finance capital investors looking to diversify their portfolio through risk-adjusted strategies is
developing on an increasing scale, from so-called ‘developed’ to ‘emerging’ countries. We posit that
contemporary UDPs are an attempt to transform land-use by leveraging resources (including capital)
exchanged on real estate markets. Therefore, the financialization of UDPs can be tackled through
an analysis of the processes through which investors’ strategies and requirements may be circulated
among key actors of UDPs (e.g. local authorities, planners, development agencies, property developers).
Three paths through which UDPs are shaped for finance capital investors are examined. First,
the production of market representations, by internationalized property consultants, skewed towards
investors’ standards. Second, the tailoring of buildings as ‘quasi-financial’ assets in the course of real
estate development, through which developers seek to address this now dominant financial clientele.
Third, the evolution of strategic planning and land development, whether as a byproduct of greater
room gained by developers, or as a result of a direct targeting of the investment industry by local
public authorities and their development agencies. Eventually, the paper discusses three avenues for
research for an urban political economy of one salient, though undersearched, aspect of the financialization
of cities.
... Financial capital is continuously inventing new strategies of 'capital switching' (Harvey, 1985; see also Aalbers, 2012;Christophers, 2011) in order to reconnect global financial strategies with the production of the local built environment, and to cope with altered perceptions of risk in times of crisis (Ashton, 2011). The current economic crisis has put urban development into question, problematising the negotiation processes between large property developers and cities, the public risk of planned projects, the financial risk of land development for local governments, and weaker public budgets (Hackworth, 2002;Kirkpatrick and Smith, 2011). ...
This paper scrutinises the effects that the financialisation of land has on the land use planning process. Although finance is increasingly penetrating not only real estate but also land planning and development, there are few in-depth case studies describing and analysing this process. Contemporary urban development is characterised by the clustering of investments, the relocation of projects into peripheral areas and an instrumental approach to planning. These trends are expressions of a change in the development process, characterised by the increased detachment between land use planning processes at the local level and financial investor logics located at other scales. We call this the de-contextualisation of land capital. An in-depth analysis of the internal economic mechanics of an urban project in the Milan area is provided to illustrate these trends. We conclude by reflecting on the challenges that the conditions of financialised land capital pose to local and national governments.
... A second examines banks or financial intermediaries as private actors capable of diminishing the authority of states over economy and society (Strange, 1996) and exerting power over urban governance agendas. For instance, Hackworth (2002) scrutinises the ways in which ratings agencies constrain local autonomy, arguing that their gatekeeper role in municipal bond markets allows them to increase borrowing costs or deny credit for localities pursuing projects that diverge from the disciplinary norms of institutional investors. ...
In the 2000s, cities across North America began leasing existing infrastructure to global investment consortia. Previous evaluations of infrastructure leases focus on the lack of transparency of the privatisation process and the terms of the arrangements negotiated by the public sector and the private concessionaires. In this research, we argue that such approaches fall short by failing to investigate the significant repositioning of the local state relative to financial markets produced by their involvement in major asset lease deals. We develop this argument through a case study of the institutional transformation of the City of Chicago, the US’s most aggressive instigator of infrastructure asset leases. Even as the concession agreements seemingly protect the City from the claims of investors, creditors and counterparties and provide it with new powers, they enmesh the City in a set of financial relationships that expose it to liabilities not accounted for in lease agreements and create an institutional bias towards managing the collateral effects of financialisation.
... Importantly, this process of globalization has had the effect of moving the policy-making arenas away from the local level. For example, local spending for schools, health systems, and other forms of collective consumption is legally a local decision, but increasingly these decisions are constrained by bond rating agencies who tend to discourage social spending in favor of corporate subsidies or, in the preferred vernacular, "public-private partnerships" (Hackworth, 2002). Importantly, while macroeconomic forces are removing power and decision-making from local actors, these forces and constraints impinging on local actors have not manifested uniformly (Brenner and Theodore, 2002). ...
In the postindustrial era, global economic processes have constrained the ability of local agencies, service providers, and civic groups to respond to systemic challenges in public health. Community health psychology can benefit by focusing on interventions through mediating structures that develop innovative methods of leveraging power in the context of globalizing economic forces. Promising methods include careful analysis of power within targeted policy domains and developing strategic alliances with others, so as to exercise social power to affect policy change. The case of ISAIAH, an organizing group based in Minnesota, illustrates innovative avenues for intervention in the context of globalization.
... Policyrelevant research need not be policy-driven research, and one way for us to challenge the narrowly-conceived calls for the "policy turn" identified by Imrie is to undertake critical, fundamental research on policy and policy formulation, as well as research on reactions to policy. Current urban political inquiry has enormous policy relevance: think of the work on the social and political construction of scale, or the studies of the effects of neoliberal governance on urban regimes, local autonomy, and conflicts among different levels of the state (Antipode, 2002; Hackworth, 2002; Lake, 2002; N. Smith, 2002; Staeheli et al., 1997). I would go farther than Imrie: American urban geography is producing plenty of policy relevant work; if the advocates of the policy turn are unsatisfied with its reception and use by policy-makers (whoever they are), then it is reasonable to ask for further clarification: are we being asked to quit our academic jobs to go work for the Urban Institute, Brookings, Cato, or the American Enterprise Institute? ...
... Four decades on, the intertwined effects of globalization, neoliberalization, and the demise of the Keynesian welfare state have reconstituted urban neighborhoods as a material resource to further the competitive state's entrepreneurial goals Merrifield, 2002;Weber, 2002). The revalorization and commodification of urban neighborhoods is consistent with broader changes in which business and pro-growth elites exert greater influence in urban regimes, prioritizing efficiency, spending restraint, and fiscal stability over goals of social welfare and collective consumption (Elwood and Leitner, 2003;Hackworth, 2002;Jonas and Wilson, 1999;Mayer, 2003). The competitive behavior of urban governments has been characterized by Merrifield (2002) as a process of "lean urbanization" in which governance increasingly mirrors the practices of private firms: ...
Manuel Castells' (1983) groundbreaking investigation of urban social movements traced `the decisive input of purposive social action' through case studies over five centuries, culminating in the 1960s social revolts in US cities. This paper continues the narrative forward by examining the changing dynamics of community development politics in US cities since 1968. Structural transformations under neoliberalism marked the end of the democratic/redistributive phase of community development, radically altered the material, strategic and institutional terrain of community development politics, and opened a space for new forms of purposive social action aimed at enduring goals of social justice.
... Smith (2002), for example, finds that real estate interests, long held to be the quintessential locally rooted capital anchoring progrowth coalitions (e.g., Logan and Molotch 1987), are increasingly international corporations with holdings across the globe, and hence less invested in the particularities of local markets, and more concerned with the greater dynamics of their global portfolios. Hackworth (2002) and Sinclair (2005) indicate the growing importance of bond-rating firms in pushing cities to adopt neoliberal policies, regardless of the composition of their governing coalitions. These agencies are also actors of global scope. ...
This article casts New York City's large, public-sector workfare program of the mid-1990s against political-economic, institutionalist, and culturalist explanations of welfare reform dynamics. It argues that the form and changes in welfare reform programs must increasingly be understood as intersecting with urban political dynamics. Synthesizing existing literatures on welfare and urban policy, the article urges explanations based on the intersection of urban labor-market and fiscal management, institutional rules, and analyses of multiscalar policy networks and urban regimes that (1) generate ideas about what constitutes policy success; (2) organize coalitions and disorganize potential opposition; and (3) import and export policy reform ideas to and from the local scale to larger scales of governance.
... The agency was rescued by legislative authorization of funds, but it was too late: the episode shook the public confidence in the legacy of Nelson Rockefeller's creative financing schemes and was followed by the broader New York City fiscal crisis and commercial banks' wariness about financing municipal budgetary shortfalls. 81 The city's near bankruptcy resulted from its inability to secure buyers for its bonds. ...
In postwar New York State, a powerful partnership among state government, the private sector, and quasi-public authorities resulted in the development of thousands of units of high-density middle-income housing located in New York City and a much smaller amount in other New York State cities. This housing was intended to counterbalance affordable suburban homes that were luring the middle class out of the city. This article describes this initiative and focuses on the contributions made by Nelson A. Rockefeller, governor of New York State between 1959 and 1973. The state made creative use of bond financing and public benefit corporations, raising capital with unsecured moral obligation bonds. New York State's housing finance mechanisms facilitated a model of housing development that was prescient in its insistence on melding public and private, which is now the dominant strategy for affordable housing development in the United States.
By analyzing the multiple forms of debt used by municipal water supply organizations, I present evidence to argue that the financial structures of contemporary public governance give financial interests undue influence over the management of natural resources. This study uses financial statistics and qualitative data pertaining to the largest provider of drinking water in the US, Metropolitan Water District of Southern California (MWD), an empirically significant case study. Municipal water agencies collect revenues through traditional sources including water sales and tax collections, but they also raise significant funding with a variety of debt instruments. In this study, I first observe a strong increase in revenue-backed debt, supplanting tax-backed debt, as the primary source of funding. Next, I examine how revenues have shifted since mid-century with water sales growing primary and taxation becoming peripheral. Lastly, I analyze the influence of financial gatekeepers – credit rating agencies – considering the growing reliance on private financial capital. I find that rating agencies push finance-oriented objectives on water managers that include commodifying water to maximize revenue, avoiding expenditures, and flouting climatological realities of scarcity, among others. I propose the notions of financial feedbacks and the financial pathology of institutions as conceptual tools for characterizing these processes.
Under the hegemony of New Public Management, local governments have been targeted by professional service firms (PSFs) resulting in outsourcing, reorganization, and marketization of public services. More recently, the local state has also increasingly been exposed to the influence of financial market actors, dynamics, and rationalities. The chapter illustrates this process of state financialization by tracing the emergence and consolidation of municipal debt management policies including the use of interest rate derivatives in the UK and Germany. This process is interpreted as a techno-political project crucially driven by private expertise and actively spearheaded by particular PSFs, namely treasury management advisors and brokers. Five stages of their involvement are identified and empirically illustrated: The crafting of a new debt management narrative, the provision of trial portfolio analyses, the canvassing, brokering, and contracting of derivative deals, the actual debt management operations, and crisis management.
City governments are embracing data‐driven and algorithmic planning to tackle urban problems. Data‐driven analytics have an unprecedented capacity to call urban futures into being. At the same time, they can depoliticize planning decisions. I argue that this shift calls urban studies scholars to investigate geographies of algorithmic violence—a repetitive and standardized form of violence that contributes to the racialization of space and spatialization of poverty. This article examines this broader phenomenon through the case of a proprietary market value assessment that is being used to guide development in cities across the United States. The assessment employs an algorithm that helps city officials make critical decisions about which neighborhoods to target for investment, disinvestment and public service upgrades or disconnections. I argue that the racial, infrastructural, and epistemological violence associated with this evaluation can potentially lead to a new kind of municipal redlining. The article brings insights from critical race theory into conversation with critical scholarship on algorithms by analyzing how algorithmic violence works through data‐driven planning technologies to depoliticize and leverage power while further entrenching racism and inequality.
Recent interpretations of the neoliberal transformation of welfare states emphasize the formative role of crises in which old institutions are rolled back to make way for the “rollout” of neoliberalism’s program of austerity, markets, and privatization. Policy scholars and social historians argue, however, that major social changes combine long-term institutional development, sudden pivots, and cyclical trends. This article draws on a case study of municipal employee labor relations in New York City to examine the temporality of neoliberal transition. It acknowledges that actual neoliberalism involves a mix of policies that depart from its market-liberal ideal type and that include elements of statist, communitarian, and/or corporatist policies. Thus the article engages a puzzle: if paths to neoliberalism are not always sudden and are populated by policies that are not necessarily driven by neoliberal assumptions, how should we understand what neoliberalism is and how it develops? The article traces the history of municipal labor relations from the 1950s through the present to show that the transition to neoliberalism was characterized by the transition from a contentious corporatism that took shape in the 1950s and went through a neocorporatism forged in the fiscal crisis of the 1970s and that kept corporatist institutions in place while undermining their social power and laying the groundwork for neoliberal policies from the 1990s forward. The article shows how longer-term trajectories and shorter-term crises intertwine to produce a neoliberalism better understood as a repertoire of governance than as an undifferentiated set of policy preferences for market mechanisms.
While the social movements literature has increasingly incorporated sociospatial categories into its conceptual toolkit, this article argues that tracing the concrete ways in which a particular category-"scale"-is mobilized as a stake of political debate helps us refine its workings in practice. Integrating research on the co-constitutive nature of law and political action, this article traces how efforts to pass antipredatory home lending legislation in the United States during the 1990s and 2000s resulted in a rescaled home-lending legal regime. Using judicial and regulatory documents, media accounts, and publications by advocates, government actors, lawyers and the financial industry, I analyze the mechanisms through which this occurred. Debates about federalism, home rule, and preemption illustrate that involved parties attempted to "fix" a legal regime scaled according to their organizational strengths. Finally, this case illustrates how discourses around globalization and economic rationality inform the trajectory of legal debates.
Faith, Government, and Neoliberalism The study of neoliberalism has been a popular theme in political science, geography, and sociology for the past decade. The focus of this vast literature varies considerably, but has been generally aimed at understanding the ways in which the ideas of midtwentieth century neoliberal ideologues like Friedman, Hayek, and von Mises have been morphed into the actualized policy apparatus at various scales in different countries.1 Research projects under this rubric have sought to explore different dimensions of this process, from the institutions that promote such ideas, like bond-rating agencies, think tanks, and the IMF, to the political logics underlying it.2 One common focus of these studies is the decentralizing or dismantling of Keynesian welfare and its replacement with policies that emphasize markets, individual responsibility, and a diminished governmental safety net—all of which are key principles of idealized neoliberalism.3 Nongovernmental organizations (NGOs) of all sorts have been called upon in this environment to absorb some of the responsibilities once ensconced in the Keynesian state. Though most religious NGOs (also referred to in this paper as “faith-based organizations” (FBOs)) have a complicated set of objectives and processes that predate the rise of neoliberalism, many have been integrated into an effort to reduce reliance on traditional, Keynesian forms of delivery in the United States and elsewhere. Such organizations are increasingly called on to deliver Keynesian services that were rolled-back through cuts.4
Faith Based explores how the Religious Right has supported neoliberalism in the United States, bringing a particular focus to welfare-an arena where conservative Protestant politics and neoliberal economic ideas come together most clearly. Through case studies of gospel rescue missions, Habitat for Humanity, and religious charities in post-Katrina New Orleans, Jason Hackworth describes both the theory and practice of faith-based welfare, revealing fundamental tensions between the religious and economic wings of the conservative movement. Hackworth begins by tracing the fusion of evangelical religious conservatism and promarket, antigovernment activism, which resulted in what he calls "religious neoliberalism." He argues that neoliberalism-the ideological sanctification of private property, the individual, and antistatist politics-has rarely been popular enough on its own to promote wide change. Rather, neoliberals gain the most traction when they align their efforts with other discourses and ideas. The promotion of faith-based alternatives to welfare is a classic case of coalition building on the Right. Evangelicals get to provide social services in line with Biblical tenets, while opponents of big government chip away at the public safety net. Though religious neoliberalism is most closely associated with George W. Bush's Office of Faith-Based and Neighborhood Partnerships, the idea predates Bush and continues to hold sway in the Obama administration. Despite its success, however, Hackworth contends that religious neoliberalism remains an uneasy alliance-a fusion that has been tested and frayed by recent events.
From New York to Madison. Workfare in the Public Sector
This article deals with workfare reforms in the 1990s and the way they impact the current debate on public workers in the United States. It focuses on New York and shows the consequences of a combination of factors: the specific institutional development of trade-unions in NY, the way local associations gave up on welfare and finally the streamlining of public services all jointly led to a deteriorating of working conditions in the public sector. These factors also paved the way for a weakening of the rights and status of public agents as illustrated also in Wisconsin.
This first textbook on the topic of gentrification is written for upper-level undergraduates in geography, sociology, and planning. The gentrification of urban areas has accelerated across the globe to become a central engine of urban development, and it is a topic that has attracted a great deal of interest in both academia and the popular press. Gentrification presents major theoretical ideas and concepts with case studies, and summaries of the ideas in the book as well as offering ideas for future research.
Austerity appears to be a globally coordinated restructuring process, where international and national governments cooperate to stymie economic crisis and socialize the costs of systemic economic failure. However, austerity is also shaped from the bottomup. This paper examines the 2008 bankruptcy of Vallejo, California. This city of under 120 000 people became the first municipal bankruptcy in the Great Recession period. We explore how it became the first to fail. In doing so, we outline the finances of a city whose entrepreneurial activities continued to flounder, making it a good candidate for austerity reforms. However, we also find the city home to a political movement long predicting a municipal default. When economic crisis hit, this movement pushed for the city to make an unprecedented test of Chapter 9 bankruptcy law. Vallejo’s bankruptcy, and the related changes to Chapter 9 law, are therefore interpreted as events that were generated by systemic conditions but ultimately precipitated by decisions taken at the municipal level. We therefore call for austerity to be understood as both a top-down and bottom-up process of state restructuring.
‘Rightsizing’ is a planning paradigm currently being applied to shrinking cities in North America and Europe. The central idea is to avoid the trap of growth-oriented planning by restructuring the urban landscape around mixed-income, mixed-use clusters. By replacing the current sprawling inefficiency, proponents argue, environmental, equity, and infrastructure efficiency goals can be achieved. Some have worried however, that rightsizing is merely a newly packaged version of urban renewal. I argue that both framings are misplaced. Through a careful consideration of rightsizing plans in five US cities— Detroit, Flint, Rochester, Saginaw, and Youngstown—I argue that austerity urbanism is the more apt way to characterize actualized versions of the idea. Actualized rightsizing lacks the utopian modernism and Keynesian interventionism of urban renewal, and the progressive equity-oriented environmentalism idealized by its proponents.
This paper examines civic mobilization for school improvement in Rivergrove, a small suburban city within the inner rings of a large Florida metro (All names of individuals, schools, organizations and communities are pseudonyms per IRB agreement with district. Subsequently, references to local media reports and city documents are disguised to meet IRB requirements.). Here, civic mobilization is understood as a movement against technocratic control over decision-making in a struggle over the social construction of place (Lake 1994). Faced with limited growth and demographic change, Rivergrove’s civic leaders embrace strategies utilized in major cities to address blight and increasing school segregation. Rivergrove’s elected and appointed leaders sought independence from the larger metropolitan school district in order to confine school boundaries to Rivergrove’s city limits, at the exclusion of low income, predominantly Black and Hispanic neighborhoods. Although local control proved infeasible, civic mobilization increased inter-governmental cooperation between city leaders and metropolitan school district officials. Efforts to improve public schooling focus on building a community identity within the schools, establishing themed academic programs in schools undergoing social economic and racial turnover, providing grants for instructional innovation, and forming regular communication between elected officials and district and school level leaders. The case of Rivergrove offers insight into the racial and class boundary making that occurs when building civic capacity.
Land abandonment is an acute problem for shrinking cities throughout the world. The prevailing legal paradigm in the United States relies on market logics to address abandonment—specifically by auctioning abandoned parcels to the highest bidder. This emphasis is reinforced by a variety of structural forces at multiple scales, despite its highly questionable efficacy as a way to return land to “productive use.” In this article, we explore the case of Toledo, Ohio, to illustrate the limitations of market logics in addressing market collapse inherent in land abandonment. We find that the market emphasis is effective neither for city building nor tax generation goals, but is deeply rooted and reinforced by layers of state law, structural forces, and pro-market institutions.
California continues to be at the epicentre of the current Great Recession. Cities around the state are facing a multiple-fronted
assault on their fiscal situation. Although not new—the state’s precarious financial situation is the stuff of legends—the
cutting in federal revenues, together with the decline in property taxes stemming from the drop in house prices and the rising
costs of servicing debt incurred through years of speculative growth strategies have left a number of city governments in
the state horribly exposed. This paper explores the place of a number of Californian cities in the context of the wider onset
of US austerity urbanism. This constitutes a deepening and widening of some aspects of earlier neo-liberalisation.
the chair of the political science department at the City College of New York. His publications include Free Labor: Worfare and the Contested Language of Neoliberalism (2007).
1. A selection of other titles from kindred researchers includes Shakedown: The Continuing Conspiracy against the American Taxpayer (Malanga 2011) and Plunder: How Public Employee Unions Are Raiding Treasuries, Controlling Our Lives, and Bankrupting the Nation (Greenhut 2009).
2. Bellush and Bellush (1984) also apply the term “political machine” to New York City’s principal public sector union, District Council 37 of AFSCME, but they do so in a way that emphasizes the positive, latent functions of the political machine indicated in Merton’s work.
3. Even when unions have gained a measure of political power by supporting Democrats, they have been far less successful in getting policies passed that strengthen unions (Lichtenstein 2012).
4. Peck indicates that policy innovations are adopted and emulated by others through networked relations and well before many outcomes can be measured. This “fast policy” is characteristic of workfare programs, in spite of the neoliberal rhetoric of the importance of measuring policy outcomes.
5. Though Mead disagreed with Charles Murray’s libertarian approach to welfare (see Mead 1985; 1992), he was embraced by the Manhattan Institute, whose City Journal ran a forum on Mead’s The New Politics of Poverty in its summer 1992 issue.
6. The decline in the rolls slowed by 1999, perhaps because there was a natural leveling off due to the low number of cases left. Nevertheless, W-2 was still viewed as a success based on caseload reduction. Yet, in a case of “fast policy” (see note 3 above), it remained true that the steepest declines occurred before W-2. Moreover, as Mead (2006) indicates, much of the decline after W-2’s introduction was due to moving child-only cases off the rolls.
7. Goldsmith would later become a deputy mayor under Mayor Michael Bloomberg of New York City, praised for his innovations in public sector labor management. His star faded, however, after being left holding the bag while the mayor was in Bermuda during a disastrous blizzard. Goldsmith, who was supposed to be running the city, was in Washington, D.C., and New York’s service response broke down without on-the-ground management. Soon thereafter, he was fired when he was involved in a domestic dispute to which the police were called.
8. See Reese (2011) for a more thorough accounting of the careers made through Wisconsin’s welfare-reform connections.
9. In an unrelated case, Hevesi himself was forced to resign as state comptroller (he won the post several years later) when it was revealed that he steered pension-fund management contracts to political contributors in a pay-to-play scheme. Hevesi also served time in prison.
10. Wernick, Krinsky, and Getsos (2000) later showed this claim to be borne out by matching union job-descriptions to surveys of WEP workers’ reports of their own work. Besharov and Germanis (2004) have registered disagreements about the study’s sample, but the sample is representative across the agencies surveyed.
11. Comments of Jason DeParle at “Whither Welfare Reform.” Manhattan Institute conference (September 21, 2004). Transcript online at http://www.manhattan-institute.org/html/mics11.htm.
12. See, for example, Wohlers (2006); see also Schram (2006) and Lieberman (2006). Schram and Lieberman both criticize Mead for other shortcomings in his work, only Schram comments on the by then evident problems in the actual governance of the programs and its discontinuity with “good government” principles. See also Dodenhoff (2002), who, in a report for the Hudson Institute focuses on the apparently low overall level of questionable spending among private W-2 agencies in an effort to show that “privatization works.”
13. The quote was originally a boast by former District Council 37 Executive Director Victor Gotbaum, which he made in 1975. Just months later, the folly of the quote became evident as he was forced to accept tens of thousands of layoffs demanded by Wall Street as a condition of not pushing New York City into bankruptcy. See Freeman (2000) and Tabb (1978). It has since made its way into...
Land abandonment is one of the most challenging planning problems facing shrinking cities in the United States. Most abandoned urban land finds its way into the tax foreclosure process wherein the city or county places a lien on the property and then eventually takes possession. Many American state laws encourage (or demand) cities to then sell these properties, often for as little as several hundred dollars. The process tempts speculative investors to enter the scene, and their often “predatory” acquisition patterns complicate city planning and redevelopment efforts. In response, activists have proposed the reform of tax foreclosure laws to allow municipalities and planners greater strategic latitude with abandoned properties. They propose enhancing cities’ abilities to demolish or refurbish properties, and even to remove parcels from the market. These efforts have been somewhat successful, but have generated a backlash from market-oriented think tanks and business interests reluctant to see governmental planning powers enhanced. This paper examines the emergence of land abandonment reforms and the powerful opposition that has hindered change.
Eight cities were selected and placed into three categories based on their current land abandonment policies: consciously managerial (Cleveland, Flint, Saint Louis); limited managerial (Buffalo, Pittsburgh, Rochester); and market-only (Detroit, Gary). Two particularly striking findings arise from this analysis. First, in addition to inhibiting systematic planning efforts in cities, market-only policies appear, ironically, to be associated with the erosion of market conditions. Second, the market importance of government intervention—whether in the form of rent vouchers or sensible land management—often does not receive sufficient attention in cities experiencing abandonment. Most tend to continue market-oriented strategies which complicate planning efforts to re-purpose land in socially beneficial ways.
San Francisco is engaged in a redevelopment project that could bring millions in investment and community benefits to a starved neighborhood—and yet the project is embedded in an urban development process that is displacing residents. In trying to unsettle these contradictions, this paper achieves two aims. First, I unearth a little known history of redevelopment activism that frames debate around the current project. Second, I use this history to argue for a reframing of the language of race. To wit: although the social construction of race and racism is well established, race is still deeply understood in everyday life as natural. This paper offers a theoretical fusing of race and class, “race-class”, to help us think race through a vital constructionist lens. Race-class makes present the economic dynamics of racial formation, and foregrounds that race is a core process of urban political economy. Race-class works both “top-down” and “ground-up.” While it is a vehicle for capital's exploitation of people and place, race-class also emerges as a mode of power for racialized working-class residents. © 2013 The Author. Antipode © 2013 Antipode Foundation Ltd.
:Recent interpretations of the neoliberal transformation of welfare states emphasize the formative role of crises in which old institutions are rolled back to make way for the "rollout" of neoliberalism's program of austerity, markets, and privatization. Policy scholars and social historians argue, however, that major social changes combine long-term institutional development, sudden pivots, and cyclical trends. This article draws on a case study of municipal employee labor relations in New York City to examine the temporality of neoliberal transition. It acknowledges that actual neoliberalism involves a mix of policies that depart from its market-liberal ideal type and that include elements of statist, communitarian, and/or corporatist policies. Thus the article engages a puzzle: if paths to neoliberalism are not always sudden and are populated by policies that are not necessarily driven by neoliberal assumptions, how should we understand what neoliberalism is and how it develops? The article traces the history of municipal labor relations from the 1950s through the present to show that the transition to neoliberalism was characterized by the transition from a contentious corporatism that took shape in the 1950s and went through a neocorporatism forged in the fiscal crisis of the 1970s and that kept corporatist institutions in place while undermining their social power and laying the groundwork for neoliberal policies from the 1990s forward. The article shows how longer-term trajectories and shorter-term crises intertwine to produce a neoliberalism better understood as a repertoire of governance than as an undifferentiated set of policy preferences for market mechanisms.
9/11 has been used in New York City politics to both explain the current fiscal crisis and justify certain economic development policies. Such use of 9/11 obscures the long-term historical roots of the current fiscal crisis, which in fact lie in the contradictions of the set of economic development policies implemented in the years since the city’s last major fiscal crisis in the mid-1970s.
Recent US literature on urban politics has been characterized by significant convergence. There has been a marked focus on the politics of local economic development, and there has also been an attempt to situate that politics with respect to processes of globalization. In particular, the globalization of the economy and correlative hypermobility of capital are seen as exerting strong redistributive pressures on urban communities. This is the 'new urban politics'. Evaluation of this thesis proceeds first by a critical interrogation of the related concepts of hypermobility of capital, and immobility of urban communities. This results in a respecification of the question as one of local dependence and the scale at which agents are locally dependent. This, in turn, allows the new urban politics to be critically linked to arguments about the territorial organization of the state. From this standpoint it also appears that claims for a secular tendency towards the hypermobility of capital lack coherence.
Investors and regulators have been increasing their reliance on the opinions of the credit rating agencies. This article shows that although the ratings provide accurate rank-orderings of default risk, the meaning of specific letter grades varies over time and across agencies. Noting that current regulations do not explicitly adjust for agency differences, the authors argue that a reassessment of the use of ratings and the adequacy of public oversight is overdue.
What determines the flow of labor and capital in this new global information economy? Who has the capacity to coordinate this new system, to create a measure of order? And what happens to territoriality and sovereignty, two fundamental principles of the modern state? Losing Control? is a major addition to our understanding of these questions. Examining the rise of private transnational legal codes and supranational institutions such as the World Trade Organization and universal human rights covenants, Saskia Sassen argues that sovereignty remains an important feature of the international system, but that it is no longer confined to the nation-state. Sassen argues that a profound transformation is taking place, a partial denationalizing of national territory seen in such agreements as NAFTA and the European Union. Two arenas stand out in the new spatial and economic order: the global capital market and the series of codes and institutions that have mushroomed into an international human rights regime. As Sassen shows, these two quasi-legal realms now have the power and legitimacy to demand accountability from national governments, with the ironic twist that both depend upon the state to enforce their goals.
"The Truly Disadvantagedshould spur critical thinking in many quarters about the causes and possible remedies for inner city poverty. As policy makers grapple with the problems of an enlarged underclass they—as well as community leaders and all concerned Americans of all races—would be advised to examine Mr. Wilson's incisive analysis."—Robert Greenstein,New York Times Book Review "'Must reading' for civil-rights leaders, leaders of advocacy organizations for the poor, and for elected officials in our major urban centers."—Bernard C. Watson,Journal of Negro Education "Required reading for anyone, presidential candidate or private citizen, who really wants to address the growing plight of the black urban underclass."—David J. Garrow,Washington Post Book World Selected by the editors of theNew York Times Book Reviewas one of the sixteen best books of 1987. Winner of the 1988 C. Wright Mills Award of the Society for the Study of Social Problems.
Robert Fitch argues that, within a generation, New York City has been transformed from the richest city in the world to one of the poorest in North America. The pillars of its economy - Macy's, The Daily News, Citibank, Olympia and York, the Trump organization - have cracked or collapsed. Today, the officially poor in New York number nearly 2,000,000 and more than 400,000 residents of the city are without jobs. In this indictment of those who have wrecked New York, Robert Fitch points to the financial and real-estate elites. Their goals, he argues, have been simple and monolithic: to increase the value of the land they own by extruding low-rent workers and factories, replacing them with high-rent professionals and office buildings. The planning establishment has been able of raise the value of real estate inside the city boundaries over 20-fold. In doing so, Fitch suggests, it effectively closed New York's deep-water port, eliminated its freight rail system, shuttered its factories and destroyed its capacity for incubating new business. Now the real-estate values have collapsed. The city is left with 65,000,000 square feet of office space - enough to last, without any new building, to the middle of the next century. In pursuit of those who are responsible, Fitch arraigns the great and the bad of the city's establishment: Roger Starr, architect of "planned shrinkage" (the withdrawal of fire, police and mass transit services from black and Latino neighbourhoods); the Ford Foundation, who proposed converting vast tracts of the South Bronx into a vegetable garden; City Hall fixers like John Zuccotti, Herb Sturz and James Felt, who cut the deals between government and real estate by working for both sides; and the Rockefeller family, whose involuntary investment in Rockefeller Center became a gigantic "tar baby", nearly swallowing up their entire fortune. Drawing on never-before-published material from the Rockefeller family archives, as well as other archival documents, this book aims to expose those responsible for the demise of New York. Robert Fitch is the author of "Who Rules the Corporation?" and "Ghana: End of an Illusion", both co-authored with Mary Oppenheimer.
This article argues that certain knowledge‐producing institutions located in the American financial industry‐ debt security or bond rating agencies ‐are significant forces in the creation and extension of the new, open global political economy and therefore deserve the attention of international political economists as mechanisms of ‘governance without government’. Rating agencies are hypothesized to possess leverage, based on their unique gate‐keeping role with regard to investment funds sought by corporations and governments. The article examines trends in capital markets, the processes leading to bond rating judgements, assesses the form and extent of the agencies' governance powers, and contemplates the implications of these judgements for further extension of the global political economy and the form of the emerging world order.
This section includes eighty-six short original essays commissioned for the inaugural issue of TSQ: Transgender Studies Quarterly. Written by emerging academics, community-based writers, and senior scholars, each essay in this special issue, “Postposttranssexual: Key Concepts for a Twenty-First-Century Transgender Studies,” revolves around a particular keyword or concept. Some contributions focus on a concept central to transgender studies; others describe a term of art from another discipline or interdisciplinary area and show how it might relate to transgender studies. While far from providing a complete picture of the field, these keywords begin to elucidate a conceptual vocabulary for transgender studies. Some of the submissions offer a deep and resilient resistance to the entire project of mapping the field terminologically; some reveal yet-unrealized critical potentials for the field; some take existing terms from canonical thinkers and develop the significance for transgender studies; some offer overviews of well-known methodologies and demonstrate their applicability within transgender studies; some suggest how transgender issues play out in various fields; and some map the productive tensions between trans studies and other interdisciplines.
In this article we use a recent publication by Mark Gottdiener, The Decline of Urban Politics: Political Theory and the Crisis of the Local State, as the basis for a discussion of the many economic and social changes taking place within advanced capitalist societies. We argue that Gottdiener was too hasty when he identified the demise of the local political realm, and we show that alternative interpretations are possible and necessary. We draw on two sets of literature: one concerning the local state and the other exploring the current phase of economic restructuring. Although we agree that urban analysis necessitates considering state theory and economic analysis, we conclude that Gottdiener's ambitious yet desolate analysis remains unproved.
During the past two decades, issues of local economic growth have come to dominate urban politics and planning in American cities, and local governments have adopted increasingly entrepreneurial economic-development strategies. Explanations of this by previous writers have claimed that entrepreneurial behavior by the local state is either economically determined, or stems from the initiatives of relatively autonomous political agents. In this paper it is contended that, in order to reassess these conflicting explanations, it is necessary to analyze how economic and political processes operating at different spatial scales interact to determine local policy formation and outcomes, and a conceptualization of local state action using this approach is developed. This is then applied to explain the evolution of downtown development policies in the central cities of American metropolitan areas. It is also argued that local context must be incorporated into the analysis in order to account for inter-urban variations in policy outcomes, and an abbreviated comparison of two central cities, San Francisco and Minneapolis, illustrates the importance of this.
Prevailing theories of local autonomy have largely precluded the possibility for effective local autonomy. Recent alternatives, however, have focused on the law and legal discourse as significant means of sustaining local power. This paper builds on the latter theoretical strain by considering the relation between power and place both within and outside the law. In this paper “autonomy” is reconceptualized with a relational rather than the traditional corporeal theory of power, emphasizing the way in which social objects are reified with power through sets of truth claims. “Local” is reconsidered as one such reification, endowed with a plethora of not merely political, but also cultural and social significations. The result is a more subtle understanding of the way in which power is exercised locally against state domination. This theory is constructed through evidence from a Massachusetts housing policy's drafting and implementation.
Contradictions associated with the growth in the power of capital suggest that the prevailing discourse and forces of globalising neoliberalism may have failed to gain more than temporary dominance or supremacy. A period of global recomposition of social forces may be emerging to reconfigure world order. A central task of global political economy is to theorise possibilities for a democratic transformation of world order, in the context of consciousness, culture, and material life, so as to transcend the oxymoron of neoliberal 'market civilisation'.
The author reports on the current status of cities in the devolving federal system and the resulting implications for city politics. In particular, he examines the strength of the fiscal link between the federal government and municipal governments and the implications of growing interest in federal devolution for city government. He concludes by arguing that growing local fiscal and administrative self-reliance create pressures on local politicians to focus on public management skills rather than on the pursuit of social and racial agendas that were the focus two decades ago. The result is a deep change in the moral tenor of city politics.
Analyzes urban effects of government programs; primarily concerned with spatial effects of programs. Some programs may induce too many or too few activities or people to locate in urban areas or in large metropolitan areas or in small towns. Alternatively, programs may induce excessive suburbanization or sprawl in metropolitan areas. During the 1970s, there was a spate of publications on the urban effects of non-urban policies. This paper builds on those publications. Presents a more unified analysis than have previous contributions, and distinguishes carefully between spatial effects of policies that are incidental to desirable policies and spatial effects that are socially inefficient because of poor government program design. -Author
Concomitant with the contemporary restructuring of local economies in the United States has been a distinctive local politics: one which revolves around a competition among localities rather than conflict with in them. The role of the local dependence of various actors is explored with a view to explaining this politics. Some firms are locally dependent and form business coalitions to stimulate investment in their local economy. They attempt to harness the powers of local government, which are susceptible as a result of their own local dependence. Subsequent local economic development programs often pose threats to people in their workplaces and living places and elicit opposition. To overcome this opposition, business coalitions attempt to promulgate a shared interest in a local community. This interest is extended to include threats to the local community implied by the economic development programs of business coalitions elsewhere. The local dependence of people makes them receptive to this argument.
In recent years, urban governance has become increasingly preoccupied with the exploration of new ways in which to foster and encourage local development and employment growth. Such an entrepreneurial stance contrasts with the managerial practices of earlier decades which primarily focussed on the local provision of services, facilities and benefits to urban populations. This paper explores the context of this shift from managerialism to entrepreneurialism in urban governance and seeks to show how mechanisms of inter-urban competition shape outcomes and generate macroeconomic consequences. The relations between urban change and economic development are thereby brought into focus in a period characterised by considerable economic and political instability.
The political apathy of the late 20th century is being offset by a counter-movement seeking to replace technocratic + political decision making with localized citizen activism. The objective of this movement is to expand the scope of local autonomy, defined here as the capacity of localities to control the social construction of place. Alternative dispute resolution (ADR) techniques, increasingly used in public policy decision making and implementation, offer the normative potential for expanded local empowerment through validation of alternative value structures and modes of discourse. If ADR reduces the salience of rational-technical discourse in public policy making, then adoption of ADR should contribute to local enfranchisement, producing greater local control over the construction of place and augmenting the expression of local autonomy. As evidenced in the case of negotiation with local communities over the siting of hazardous waste facilities, the empowering potential of ADR has been subverted in the process of its implementation by the state. To explain the failure of ADR to empower localities in practice, I identify a series of structural barriers to local autonomy embedded in the state's negotiation process. Contrary to ADR's theoretical inclusivity and normative embrace of parallel discourses, these structural barriers undermine local autonomy by reasserting the dominance of rational-technical discourse in the policy-making process. The state's success in controlling negotiations to maintain pliable communities, however, is short-lived. When understood as a continuing and constitutive relation between the local and the non-local, local autonomy that is blocked by truncated negotiations finds expression through other means.
Despite their increasing prominence within the contemporary financial system, the collective impact of institutional investors (i.e. mutual, pension and hedge funds) and, in particular, their role in the reproduction of neoliberalism has received little attention among scholars. The argument of this article is that a focus on institutional investors is necessary in order to develop a more complete understanding of the shift towards neoliberal social relations of production. More precisely, it argues that institutional investors possess specific characteristics which are serving to reproduce neoliberal restructuring in both coercive and consensual ways. In terms of the former, it argues that the rise of institutional investors has led to a centralization of investment decision making and to a situation in which neoliberalism is being reproduced in a coercive fashion. In terms of consent, this article argues that the specific characteristics of institutional investors are serving to link a broad range of interests in civil society to those of financial institutions. Taken as whole, this analysis contributes to the growing international relations scholarship which identifies the increasing power of non-state actors in the international system and their role in the contemporary process of restructuring.
What causes urban decline andfiscal crises in American cities? Continued debate has genemted several theoretical explanations: bureaucratic ineffciency and corruption, product life cycle, manker-oriented investment, and capital mobility. A case study analysis of a city in crisis reveals the processes of crisis formation and resolution and enables us to examine the utility of these models. None of these models suflciently explains Cleveland's defbult in 1978 This case is explained best by a political economic analysis of the power offinance capital and its ability to shape local urban policy. me structural processes of elite coalescence and bank hegemony empowered the banking community to socially construct Cleveland's crisis and to strongly influence the resolution of that crisis.
Since communities have failed to generate their own indicators of social and economic well-being and the quality of community life, they have been forced to rely on externally generated indicators, often presented in form of rankings comparing one community with another. Three such rankings are explored in this paper (1) credit risk, (2) urban distress, and (3) quality of life. While each of the ratings serves a particular purpose and clientele, none was designed with the needs or interests of cities in mind. These rankings affect the community in numerous ways both directly and indirectly by driving up the cost of borrowing, altering local priorities and distorting agendas, and by shaping the images held by persons and businesses of particular cities and the desirability of locating in them. Unless and until local governments are willing to generate their own indicators they are at the mercy of these and should be aware of their strengths and weaknesses.
Abstract For all its rhetorical appeal, the meaning of local autonomy remains opaque. Local autonomy is desired by the left and the right, yet is compromised by many laws administered by higher tiers of the state. In this paper I propose a theory of autonomy, premised upon two principles of power derived from Bentham: immunity and initiative. The former refers here to the power of localities to function free from the oversight authority of higher tiers of the state. The latter principle refers to the power of localities to legislate and regulate the behavior of residents. I describe a fourfold taxonomy of autonomy and draw implications regarding the assumptions of current theories of local government power. Finally, an example from Illinois illustrates the theory.
The New Urban Politics (or NUP) of local economic development has become one of the dominant themes in urban political economy in the last twenty years. But despite the volume of research this has generated, basic problems remain in the theories that underlie this academic and political work. This paper begins with a discussion of the understandings of the central concepts of locality and autonomy in the NUP. These understandings of locality and autonomy are then criticized for failing to recognize the relational and processual character of both of these constructs. Local autonomy is then retheorized as the capacity to control the production of place. In particular, the paper focuses on groups constructing institutions and relationships of local ownership. These organizations, it is argued, have combined the goals of local autonomy and local economic development, and in so doing have produced new localities in the places in which they are organizing.
Stephen L. Elkin deftly combines the empirical and normative strands of political science to make a powerfully original statement about what cities are, can, and should be. Rejecting the idea that two goals of city politicsâequality and efficiencyâare opposed to one another, Elkin argues that a commercial republic could achieve both. He then takes the unusual step of addressing how the political institutions of the city can help to form the kind of citizenry such a republic needs. The present workings of American urban political institutions are, Elkin maintains, characterized by a close relationship between politicians and businessmen, a relationship that promotes neither political equality nor effective social problem-solving. Elkin pays particular attention to the issue of land-use in his analysis of these failures of popular control in traditional city politics. Urban political institutions, however, are not just instruments for the dispensing of valued outcomes or devices for social problem-solvingâthey help to form the citizenry. Our present institutions largely define citizens as interest group adversaries and do little to encourage them to focus on the commercial public interest of the city. Elkin concludes by proposing new institutional arrangements that would be better able to harness the self-interested behavior of individuals for the common good of a commercial republic.
Investor capitalism: how money managers are changing the face of corporate America Basic Books DOJ urges sec to increase competition for securities ratings agencies. Press release
- M Useem
Useem, M. (1996) Investor capitalism: how money managers are changing the face of corporate America. Basic Books, New York. US Justice Department (1998) DOJ urges sec to increase competition for securities ratings agencies. Press release (http://www.usdoj.gov/atr/public/press_releases/1998/1596.htm).
The long default: New York City and the urban fiscal crisis The Economist (1993) Detroit's mayor: a job fit for heroes Recalled to life: a survey of international banking The use and abuse of reputation
- W Tabb
Tabb, W. (1982) The long default: New York City and the urban fiscal crisis. Monthly Review Press, New York. The Economist (1993) Detroit's mayor: a job fit for heroes. 28 August. —— (1994) Recalled to life: a survey of international banking. 30 April. —— (1996a) The use and abuse of reputation. 6 April. —— (1996b) Aaaargh! Credit-rating agencies. 6 April.
Politics, local government and the municipal bond market The municipal money chase: the politics of local governmental finance Finance capital and the city Debt wish: entrepreneurial cities
- A Sbragia
Sbragia, A. (1983) Politics, local government and the municipal bond market. In A. Sbragia (ed.), The municipal money chase: the politics of local governmental finance, Westview Press, Boulder, CO. —— (1986) Finance capital and the city. In M. Gottdiener (ed.), Cities in stress, Sage, Beverly Hills, CA. —— (1996) Debt wish: entrepreneurial cities, U.S. federalism, and economic development. University of Pittsburgh Press, Pittsburgh, PA.
Political crisis, fiscal crisis: the collapse and revival of New York City
- M Schefter
Schefter, M. (1992) Political crisis, fiscal crisis: the collapse and revival of New York City. Columbia University Press, New York.
Philadelphia Mayor proposes bailout. The New York Times 21 February. —— (1992b) Philadelphia getting credit for reversing a fiscal fall. The New York Times 21 May. —— (1993) Philadelphia climbs out of fiscal depths and builds by sharing sacrifices
- M Decourcy Hinds
deCourcy Hinds, M. (1992a) Philadelphia Mayor proposes bailout. The New York Times 21 February. —— (1992b) Philadelphia getting credit for reversing a fiscal fall. The New York Times 21 May. —— (1993) Philadelphia climbs out of fiscal depths and builds by sharing sacrifices. The New York Times 6 April.
The new localism: comparative urban politics in a global era
- E Goetz
- S Clarke
Goetz, E. and S. Clarke (eds.) (1993) The new localism: comparative urban politics in a global era. Sage, Newbury Park, CA.
Addressing unfunded pension liability: pension bonds in the city of Philadelphia
- B Hayllar
Hayllar, B. (1999) Addressing unfunded pension liability: pension bonds in the city of Philadelphia. Government Finance Review December, 31–3.
Measuring municipal default risk
- D Litvack
Litvack, D. (1999) Measuring municipal default risk. Government Finance Review 15, 19–21.
The local state: public money and American cities Moody's Investor Service (1999) Credit report for Detroit Credit report for New York City Credit report for Philadelphia
- E Monkkonen
Monkkonen, E. (1995) The local state: public money and American cities. Stanford University Press, Stanford, CA. Moody's Investor Service (1999) Credit report for Detroit. December, New York City. —— (2000a) Credit report for New York City. September, New York City. —— (2000b) Credit report for Philadelphia. July, New York City. —— (2000c) Corporate website: www.moodys.com. Noble, B. (1992) A downgraded Detroit cries foul. The New York Times 3 November.
Class, power & austerity: the New York City fiscal crisis The determinants of municipal credit quality
- E Lichten
Lichten, E. (1986) Class, power & austerity: the New York City fiscal crisis. Bergin & Garvey Publishers, South Hadley, MA. Lipnick, L., Y. Rattner and L. Ebrahim (1999) The determinants of municipal credit quality. Government Finance Review 15, 35–41.