Finance fuels housing crises; Spain's left-wing mayors; housing the homeless; unprofitable Uber; & more!
|Jun 9||Public post|| 3|
I started this issue with a look at financialization and land in the context of housing crises, thanks to some great pieces in Dissent and the LRB, then briefly recapped what happened to Spain’s left-wing mayors in the recent local elections. In short, they could still return to power.
If you liked Hubert Horan’s piece last week on Uber’s propaganda, he had another piece on its business model that I highly recommend (find it under “Cars and roads”). There are also great articles criticizing EV subsidies, looking at homelessness policies, and on Robert McNamee’s opposition to Sidewalk Toronto. Plus, I wrote a piece comparing London and Oslo’s policies to reduce car use.
Have a great week!
Financialization fuels housing crises
Dissent Magazine published three great housing pieces this week on financialization, rent control, and alternatives to neoliberal housing policy. I’ll focus first on the financialization piece before touching on the other two.
Elizabeth Capelle uses the example of the United Kingdom, and a range of great left scholarship on the country’s housing market, to show how the British housing market disproves the common neoliberal assertion that increasing housing stock will lower rents and house prices because land is often left out of those assessments.
A variety of real-world factors complicate a simple supply-and-demand understanding of housing costs. As economist Christine M.E. Whitehead argued in a 2012 article, the housing market is characterized by inelasticity of supply; the lag time and financing required for new construction preclude prompt response to demand for new units. But what makes housing most distinctive is that its value depends heavily on the location of the land under it. Land in desirable locations is scarce, and you can’t produce more of it. This bears directly on the housing market.
It wasn’t a lack of supply that caused housing prices to soar; rather an “‘ever increasing supply of credit interacted with a fixed supply of land, fueling the house price boom’, and housing prices pulled away from income. With the ‘house price boom’ came a corresponding rise in rents.” In other words, it wasn’t supply/demand, but financialization of housing, and that will need to be addressed to reduce prices.
For a more in-depth look at the extent and effects of land privatization in Britain, Ian Jack’s recent piece about “The New Enclosures” by Brett Christophers in the London Review of Books details how the British state privatized two million hectares, or 10% of the country’s landmass, at a value of £400 billion since 1979, and how land now accounts for 70% of a house’s sale price, compared to just 2% in the 1930s.
Drawing from scholarship on this financialization, Capelle lays out four policies to start to address financialization:
first, a housing policy that would not favor homeownership, as current policy does, and instead “shift fiscal support from mortgage loans to building and maintaining social [public] housing”; second, promotion of alternate forms of housing such as limited-equity coops and community land trusts, to prioritize “housing as a social good over housing as a commodity or financial asset”; third, regulation to tighten requirements for mortgages, which would ultimately bring down housing costs; and fourth, regulation of mortgage securitization and interest rates. Others have endorsed an additional reform: a land-value tax to address “the problem of rent.” If this were enacted, land would be taxed, but not the housing or other improvements on it, returning socially created value to the public.
In addition to Cappelle’s piece, Daniel Wortel-London wrote about the movement for rent control in New York City in the early twentieth century and the recent growth in housing activism, while Leo Goldberg addressed the need for community land trusts, an expansion of public housing, and treating housing as shelter instead of an asset.
A Spanish mea culpa?
After the Spanish local elections that coincided with the European elections at the end of May, it looked like the left-wing mayors of Barcelona, Madrid, and some other Spanish cities would be swept out of power — by parties in favor of Catalan independence in Barcelona and by right-wing and far-right parties in Madrid. That may not ultimately happen, but it’s important to understand why left-wing mayors who were trying to make their cities more liveable suffered in the elections.
Economist and activist Sol Trumbo Vila explains that these left-wing municipalists depended on the convergence of three groups: the traditional left, such as old Communist parties; grassroots activists from the anti-globalization and anti-austerity movements; and unmotivated social democrats looking for an alternative. The electoral defeats they suffered, thus, came from a fracturing of this coalition, and the article goes through the specifics for several Spanish cities.
Simón Vázquez, meanwhile, looks specifically at the issues that faced Barcelona mayor Ada Colau and the larger Catalan left by digging into the different parties and political factions. He explains that Colau and Madrid’s Manuela Carmena could still return as mayors, but it would require making deals with new parties.
Vázquez writes that Colau is trying to get the support of the social-liberal Socialists’ Party of Catalonia (PSC) and the center-right Ciudadanos, which is currently led by former French prime minister Manuel Valls. In a press conference on Saturday, however, Colau, whose party came second, said she would try to make a pact between the first-place, pro-independence Esquerra and third-place PSC, and denied having sought the support of Valls.
Around the world
In the process of decarbonization, cities will need to be redesigned, but how that redevelopment takes place will depend on the values which dominate politics. With the rise of renewed fascist and socialist movements, two very different visions of the city will be on offer.
Cities are the physical embodiment of the values, biases, and power structures of a society and its economy. Ugly, brutal, capitalist America has built ugly, brutal capitalist cities. […] If fascists and feudal capitalists dominate politics this century, then these new and redeveloped cities will reflect their values: authoritarianism, rule by the rich, and violent elimination of the vulnerable. If libertarian ecosocialist values dominate politics, then our cities will reflect those values instead: the sanctity of life, liberty, and equality. The stakes couldn’t be much higher.
Transit and trains
😊 A fantastic bus driver in Brampton, Ontario started learning Punjabi and Gujarati because there are a lot of native speakers in the area he serves. One passenger said it’s particularly great for older people. “It makes us happy... I really appreciate him.”
🏳️🌈 Meanwhile, a lesbian couple in London was harassed and attacked on a bus. There’s a lot about this story that made me sad and angry, but the fact that it happened on transit really hurt. Everyone should feel safe on the bus. “Reported homophobic hate crimes across London have increased from 1,488 in 2014 to 2,308 in 2018.”
🇲🇽 “In Mexico City, someone living in one of the wealthiest neighborhoods has 28 times better access to jobs in a 30-minute trip by public transit and walking than someone living in the poorest areas.”
🚄 Amtrak is upgrading track between Washington, D.C. and Baltimore so trains can reach 125 mph (201 km/h)
🇮🇪 Ireland is modernizing its train network and planning to rely on battery-powered trains in areas without overhead electric cables
Bikes and scooters
🇫🇷 Paris is bringing in new scooter restrictions: 20 km/h speed limits, 8 km/h in areas with heavy pedestrian traffic, and no parking outside designated areas. It will also reduce the number of operators from twelve to three and cap scooter numbers.
🇨🇦 Canadian cities are preparing regulations as scooter companies prepare to launch
🚲 Protected bike lanes aren’t just safer for cyclists; they’re also safer for drivers
🇳🇱 Amsterdam will force mopeds out of bike lanes and their drivers to wear helmets
Cars and roads
🚨 If you liked Hubert Horan’s piece on Uber’s propaganda, you’ll his argument on why Uber will never be profitable: it doesn’t accrue platform efficiencies, its costs are higher than taxi companies, its margin improvements are mainly from driver pay cuts, and it has facilitated “a direct wealth transfer from labor to capital of over $3 billion”
⚡️ New study questions equity and efficiency of electric-vehicle subsidies, finding they primarily benefit high-income households, go to people who planned to buy an EV anyway, and mainly substitute highly efficient ICE vehicles or hybrids
🛢 Natural gas isn’t a “bridge fuel” and new report shows why
🚗 Uber’s success depends on regulators allowing it to continue treating drivers as contractors and ignoring allegations of price fixing. Its IPO “confirmed that the real Silicon Valley business model is the concentration of wealth and power at the top.”
🛣 Portland cut congestion more than any other U.S. city, but the media’s not talking about it
Environment and climate crisis
☀️ Higher temperatures will kill thousands more people every year in major U.S. cities
🌧 Which city is the world’s rainiest? It’s hard to say for sure, but you might be surprised by where the contenders are located.
🇪🇸 Barcelona receives more cruise ship pollution than any other city in Europe
🇮🇸 To get tourists to cut down on single-use plastic, Iceland is promoting its tap water as a premium water brand, Kranavatn, that’s free from the tap instead of in a bottle
🇬🇷 Athens buried its three major rivers under concrete as it pursued car-centric development in the post-war years, but one could soon be freed
Housing and homelessness
🇫🇮 Helsinki’s policy of housing and supporting homeless people significantly reduced homelessness. The city maintains a strict mix of 25% social housing, 30% subsidised purchase, and 45% private sector in new districts to limit segregation. Public and private buildings look the same and there is no income ceiling on social housing.
🇺🇸 Los Angeles has the most acute homelessness crisis in the U.S., with nearly 60,000 people without homes after increases of 16% in the city and 12% in the county. “They underline a direct correlation with the crippling shortage of affordable housing.”
Ever since the state began to withdraw from housing supply in the late 1970s, development in Britain has been overwhelmingly reliant on private developers. The duty of these companies is to their shareholders, and they shape the built environment in whichever way will maximise shareholder value. In many cases, this bears little resemblance to the type of buildings, tenures and amenities that communities actually require.
Other interesting reads
🙄 People behind Boston “straight pride” parade are part of a far-right group with links to white nationalism, antisemitism, and opposition to gun control
🕌 Athens will open its first official mosque in 180 years within months. It’s the only European capital without a mosque.
🛍 Advertising is ravaging our planet and our cities. Is it time to get rid of it?
🛂 “Before you ask them to respect our borders, ask yourself: Has the West ever respected anyone’s borders?”
The waterfront project is the first incarnation of a Google City run by algorithms. […] They hope to displace democracy, to impose efficiency on consumers who would otherwise make decisions for themselves. It is a dystopian vision that has no place in a democratic society.
London and Oslo Took On Cars, But the Key was Investing in Alternatives: whether cities choose congestion pricing or regulations, they need to invest in transit, cycling, and pedestrian spaces for public support and the full benefit
Uber’s $200 Helicopter Ride is a Preview of its Pricey Flying Cars: Uber’s flying cars will look a lot like its new helicopter service, not the equitable picture it tried to paint for the press
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