Urgent need for governments to deal with urban decay and green up our cities

For various reasons, I am often in Melbourne and over the last few trips I have avoided public transport (trams) for obvious reasons. In my wanderings to various destinations in the inner city I have noticed that many shops that have been trading since I grew up in that city have now disappeared as a result of the coronavirus lockdowns and the shift away from store-based retail. They were struggling before the virus hit and have now gone. Whole retail shopping strips are in trouble (the famed Chapel Street, Bridge Road, and now Victoria Street, to name just a few retail areas in serious decline). When I arrive at the airport and move into the city I get this overwhelming feeling that all this infrastructure we have built is becoming redundant in a post-Corona world. It also reinforces my view that governments are going to have a major role in transforming these urban spaces to be better suited for the needs of whatever future there is to be. This view was strengthened when I read a recent report from a research group at Cambridge University in the UK – Townscapes: England’s health inequalities (released May 2020) – which found that health inequalities in England are rising as a result of the pattern of urban development over the period of austerity. In some of the “most deprived set of towns” residents are “much worse off than the least deprived on a number of key measures”. I suspect, similar outcomes would be found in Australia and elsewhere, should the research be done. With the virus fast-tracking major shifts in the way we relate to retailing and service delivery, now is the time to implement a new urban plan to green up our urban spaces, ensure there is viable employment bases in all cities, and maintain a close link between the social and economic settlements, a link that has been increasingly broken under neoliberalism.

There are many commentators who have suddenly found that unfettered globalisation (particularly of capital) is not the path to nirvana.

And there are all sorts of calls now for nations to return to more self-sufficient positions.

In the Australian case, this means that the manufacturing industry, that has been in terminal decline for years now, is revitalised.

What goes round comes round!

All these characters that touted the ‘free market’ are now favouring government intervention and financial support for failing capitalist firms and sectors.

We read, almost daily, how government should invest billions here or millions there to save some firm or sector.

The federal government has even created a – National COVID-19 Coordination Commission to “minimise and mitigate the impact of COVID-19 on jobs and businesses, and to facilitate the fastest possible recovery of lives and livelihoods.”

Did I say planning!

Yes, the wheel turns.

One of its plans it to restore profitability and jobs to manufacturing.

I will discuss that topic separately because, while many unions and progressives hanker for the days when factories purred and created relatively high-paying, secure jobs, the validity of the proposition is far from straightforward.

There were reasons manufacturing declined so thoroughly and they were not all related to poor policy or lack of government support.

It may be a good idea to introduce an industry policy designed to stimulate manufacturing, particularly in renewables and other future technologies, but dreaming of a return to large-scale, dirty-type manufacturing production is probably a step too far.

We should also realise that the sector is still one of the largest employers (about 7.1 per cent of total employment and rising).

But I will leave that for another day.

When I was in Manchester in February this year, I couldn’t believe some of the changes to the inner city. I had studied in the city during the 1980s when Margaret Thatcher was just warming up and saw the devastation of some of the urban areas that came with a hollowing out of state services and rising joblessness.

It looked worse to me in February, although it was a typically cold and wet Manchester day, which might have coloured my judgement. I also didn’t go out to my old haunts down Oxford Street and beyond.

But I think what is happening across most nations is part of a similar trend.

The report from the Bennett Institute for Public Policy at Cambridge University on the growing inequalities across the English urban landscape focuses our attention on the future.

I think it also explains, in part, why the Yes vote won in 2016, although I am sure the urbanite Left in London won’t agree.

The Bennett Institute have what they call their ‘Townscapes Project’, which seeks to explore the fortunes of towns, principally, but not exclusively in Britain, in a globalised world, exacerbated by the mindless austerity policies that have inflicted on regions and peoples.

We have known for a long time that the way in which the globalised economy has evolved has created differential spatial patterns of economic development, particularly in terms of concentrating high-paid, more secure work in the major city centres and starving the regional centres, which in part grew up as service centres for manufacturing, of jobs and opportunities for youth.

The ‘Townscapes Project’ is about exploring very “granular” data to get beyond the ‘north-south’ stereotypes and to expose the drivers of spatial inequality and the likely policy responses that will attenuate them.

The point that cannot be avoided is that societies will only tolerate a certain degree of inequality before they crumble.

The events on the streets in the US and beyond at the moment tend to reinforce that assessment.

I have written in the past about the declining regions of Australia as neoliberalism hollows out the economic settlement and concentrates jobs in the large urban centres.

Many regional cities then start losing their critical mass of services, the youth move to the major centres, and the, previously vibrant regional cities virtually become geriatric centres, dying with the remaining older residents.

For example, these blog posts cover related topics:

1. Brainbelts – only a part of a progressive future (July 25, 2016).

2. The urban impact of the failure of austerity (January 26, 2016).

In the mid-1980s, as progressives were floundering around to find some answer to the dominance of neoliberalism they came up with some ridiculous ideas.

Remember Tony Blair’s ‘Third Way’ nonsense.

There was social entrepreneurship.

And the was the so-called ‘New Regionalism’, which was largely driven by case studies documenting economic successes in California (Silicon Valley) and some European regions (such as Baden Württemberg and Emilia Romagna).

The interlinked ideas that define this approach to ‘space’ were consistent with the oft-heard claim from neo-liberals that the ‘national’ level of government gets in the way of development.

It also fed into the Left narratives that globalisation had usurped the power of the nation state and that international solutions to inequality were necessary.

Thomas Fazi and I considered all that in our book – Reclaiming the State: A Progressive Vision of Sovereignty for a Post-Neoliberal World (Pluto Books, September 2017).

New Regionalism claimed that ‘the region’ had become the “crucible” (to use the words of British regional scientist John Lovering) of economic development and should be the prime focus of economic policy.

In this way, the claim was that regions had usurped the nation state as the “sites of successful economic organisation” (Scott and Storper’s words) because supply chains (in the post Fordist era) had become more specialised and flexible given the need to deal with uncertain demand conditions.

New Regionalism advocates argued that regional spaces provided the best platform to achieve flexible economies of scope that allow nations to adjust to increasingly unstable markets.

These socio-spatial processes allegedly would require localised knowledge creation, the rise of inter-firm (rather than intra-firm) relationships, collaborative value-adding chains, the development of highly supportive localised institutions and training of highly skilled labour.

These dynamics then demanded that firms to locate in clusters, often grouped by new associational typologies (for example, the use of creative talent or untraded flows of tacit knowledge) rather than by a traditional economic sector such as steel.

The new post-Fordist production modes emphasise new knowledge-intensive activities encouraging local participative systems. By achieving critical mass of local collaborators, a region could be dynamic and globally competitive.

Most these claims were based on induction of regional ‘successes’ without regard for the specific cultural or institutional contexts, and lack any coherent unifying theoretical underpinning.

It is highly disputable whether the empirical examples that were advanced to justify the claims made by New Regionalist proponents actually represented valid evidence at all.

For example, John Lovering (1999: 382) examined the claimed made in the 1990s about Wales and concluded:

If one factor has to be singled out as the key influence on Wales’ recent economic development … it is not foreign investment, the new-found flexibility of the labour force, the development of clusters and networks of interdependencies or any of the other features so often seized upon as an indication that the Welsh economy has successfully ‘globalized’. Something else has been at work which is more important than any of these, and it is a something which is almost entirely ignored in New Regionalist thought … It is the national (British) state.

(Reference: Lovering, J. (1999) ‘Theory led by policy: the inadequacies of the New Regionalism’, International Journal of Urban and Regional Research, 23, 379-395.)

That is, a supportive macroeconomic policy framework – read deficit spending from the currency-issuing government.

While many criticisms can be levelled at New Regionalism, its major weakness has always been that it perpetuated the notion that regions can entirely escape the vicissitudes of the national business cycle through reliance on a combination of foreign direct investment and export revenue.

It is a different spin (a variation) on the ‘business cycle is dead’ notion and amounts to a denial that macroeconomic policy – that is, at the national level – can be an effective response to global trends that penetrate via the supply chains defined by trade patterns to the local region.

New Regionalism thus supported neo-liberal claims that fiscal and monetary policy had become impotent and, in turn, it constructed mass unemployment as an individual phenomenon.

By ignoring the fact that mass unemployment demonstrates the unwillingness of the central government to spend sufficient amounts of currency given the non-government sector’s propensity to save, the neo-liberal position was left unchallenged and was actually reinforced.

A new style of – Say’s Law – emerged with claims that post-Fordist economies need to focus on ‘supply-side architectures’.

And now some decades into this abandonment of regional and urban planning, we are seeing the consequences in our towns and cities.

And urgent and planned government intervention is required.

The Bennett Report focuses on the health inequalities that have emerged that are directly traceable to the way in which urban settlements have responded to the trends noted and the rising austerity imposed on nations by neoliberal governments since the 1990s.

The main findings are:

1. “there are some marked, and worsening, health inequalities within the English townscape”.

2. Citizens in England’s “most deprived towns” endure “Shorter life expectancy, worse self-reported health, and the higher relative incidence of a number of illnesses mean that people who live in these different places have much lower wellbeing than their counterparts in more affluent places.”

3. Importantly:

… the ongoing coronavirus pandemic will … these inequities worse, not least because of its impact upon the employment prospects of those in the lower part of the income distribution.

4. Government must address issues such as “access to green spaces and associated issues like air quality, but also in terms of the retail options available to residents.”

5. The declining “high streets” (shopping precincts) require attention given they influence health outcomes.

6. As the inner cities decline, the quality of the shopping provided declines – we see a rise in $1 shops selling junk, increased tattoo and sex shops, and a proliferation of “convenience and fast food” shops that undermine health outcomes.

This is because rents fall as the quality of retailing falls and low-cost, low-productivity ventures enter.

7. Available services, particularly in health care, vary widely across different towns which impacts on the health outcomes of the residents. In the towns in decline, the professional services are among the first to go.

This is exacerbated by shifts in government policy towards supporting public health (shift to user pays etc), which makes it impossible for health services to survive in regions where jobs and incomes have dried up.

8. Towns that have abandoned green spaces – selling it off to developers so they can profit – face poor health outcomes.

The Report says that:

The COVID-19 crisis is having a major impact upon England’s towns. Access to green space, which is crucial to the mental and physical health of a population, especially during lockdown, is very unevenly distributed within them. There is an overriding need for policies to address the large and widening gaps in the health and economic fortunes of many towns, and these should be integral to the ‘levelling up’ and economic recovery agendas.

A major problem in Australia, for example, is the cuts in funding to local governments, who are then forced to party with developers to generate funds for service provision.

The distortion of the urban landscape that has followed is now delivering shocking health outcomes as exposed by the Bennett Report for Britain, which has experienced shocking cuts to local government grants from the national government.

Conclusion

The bottom line is this.

If regions are left to decay, the children perform worse in school, become obese because the food outlets available are all unhealthy and the green spaces disappear, and then form gangs because there are no jobs.

Society can only stand so much of that before it breaks.

It is breaking all over the world after several decades of this slow burn destruction of our job opportunities and urban infrastructure.

There is no shortage of government cash and with the COVID-19 pandemic making matters worse, now is the time for governments to be bold and start repurposing the declining retailing districts and improving services and generating work.

That is enough for today!

(c) Copyright 2020 William Mitchell. All Rights Reserved.