Part 1 - The Right to the City Lecture: David Harvey
Here’s yet another David Harvey lecture. Not on the financial crisis per se, but based on his New Left Review article The Right to the City and how modern capitalism is closely tied to the development of urbanisation. I found it particularly handy, as I still have to read all of that article and the lecture covers almost all of the same ground.
What was particularly interesting, from an Irish point of view, is his discussion of the rebuilding of Paris by Eugène Haussmann in 1853, during the reign of Napolean III. As Harvey has argued before capitalism create surplus value by investing in construction financed through credit. So it happens that the radical renovations in Paris were paid for with credit and this debt was bundled into products. In a similar way to the recent sub-prime crisis the future value of these products was then speculated upon. This lead to a crash, of course; Haussmann was dismissed and Napoleon III decided to declare war on Bismarck’s Germany.
Haussmann clearly understood that his mission was to help solve the surplus-capital and unemployment problem through urbanization. Rebuilding Paris absorbed huge quantities of labour and capital by the standards of the time and, coupled with suppressing the aspirations of the Parisian workforce, was a primary vehicle of social stabilization. He drew upon the utopian plans that Fourierists and Saint-Simonians had debated in the 1840s for reshaping Paris, but with one big difference: he transformed the scale at which the urban process was imagined. When the architect Jacques Ignace Hittorff showed Haussmann his plans for a new boulevard, Haussmann threw them back at him saying: ‘not wide enough . . . you have it 40 metres wide and I want it 120.’ He annexed the suburbs and redesigned whole neighbourhoods such as Les Halles. To do this Haussmann needed new financial institutions and debt instruments, the Crédit Mobilier and Crédit Immobilier, which were constructed on Saint-Simonian lines. In effect, he helped resolve the capital-surplus disposal problem by setting up a proto-Keynesian system of debt-financed infrastructural urban improvements.
The system worked very well for some fifteen years, and it involved not only a transformation of urban infrastructures but also the construction of a new way of life and urban persona. Paris became ‘the city of light’, the great centre of consumption, tourism and pleasure; the cafés, department stores, fashion industry and grand expositions all changed urban living so that it could absorb vast surpluses through consumerism. But then the overextended and speculative financial system and credit structures crashed in 1868. Haussmann was dismissed; Napoleon III in desperation went to war against Bismarck’s Germany and lost. In the ensuing vacuum arose the Paris Commune, one of the greatest revolutionary episodes in capitalist urban history, wrought in part out of a nostalgia for the world that Haussmann had destroyed and the desire to take back the city on the part of those dispossessed by his works.
He concludes on his point about capital accumulation through dispossession. Where those who had least to gain from this speculation on property, those who are living in the communities where they bought houses face foreclosure and ultimately being displaced. This is happening not only in places like Baltimore but enmass in China and Mumbai. Meanwhile the speculators on Wall Street have barely been affected at all.
Part 2 - The Right to the City Lecture: David Harvey
The Right to the City - part 2