First part of a three part series on what is happening to cuities under capitalism
Over half of the world’s population live in cities. This is expected to rise to 75% by 2050. The move to the cities first occurred in Europe with industrialisation. It was a relatively slow process compared to the pace of change in the developing world. For example, London in 1910 was seven times larger than it had been in 1780 whereas, China added more city-dwellers in the 1980s than did all of Europe, including Russia, in the entire 19th century (Davis: 2007). And cities are constantly changing, transformed by the need for capitalism to find new sources of profit. Capitalism has continually strived to ensure that all aspects of work involve the creation of surplus value. Now, capital is bringing all aspects of life into the capitalist orbit- making where we live and what we do when we are not at work, part of this value creation system. This means the control of all space, not just where we work.
Britain and other western countries have seen a massive increase in the cost of housing, increase in evictions and homelessness, whole council estates torn down and sold off to private developers, overcrowding in squalid accommodation, city centres privatised and transformed into sanitised shopping malls, business centres and tourist destinations,attacks on the poor- cuts in benefit, the bedroom tax, low wages, fewer green and open spaces and more sky scrapers, increased pollution, police violence, and increased surveillance.
Meanwhile, developing countries have seen rapid urbanisation as rural dwellers are forced into the cities to make a living, no concern to provide any housing for the new arrivals, massive growth in slums and shanty towns, slum clearances on a regular basis when it suits the needs of capital, demolition of traditional urban communities to make way for corporate architecture and gated communities.
All of these things have one cause- the transformation of cities all over the world from places of homes, neighbourhoods, and social networks to places where capital can make money. We are witnessing social cleansing on a mass scale as cities are turned into investment opportunities and playgrounds for the increasing number of the super-rich, both home-grown and foreign, with local and national politicians firmly behind them. Yet at the same time, capital has need of workers, so they can’t push us too far outside of the city. So the working class and the poor are channelled into enclaves of sub-standard, overcrowded housing or slums and shanty towns in the developing world. Meanwhile, the well-off hide in their gated communities and their security-protected luxury tower blocks. We are witnessing nothing less than the complete takeover of the city by capital and the state, reshaping the city for high-value business, including tourism and the culture industry, such as universities and the areas that surround them.
This process has been going on for several decades.There have been pockets of resistance as individuals and groups fight back: against workfare, benefits cuts, the bedroom tax, hospital closures, estate evictions, luxury developments, police violence, and racism. However, the attack continues, seemingly unstoppable. But recently more and more people are realising what is happening, and they are beginning to link up struggles and are winning some important victories against property developers, landlords, and government. The future of our cities now hangs in the balance. It is up to us to fight for the kind of city we want to live in. This puts us in direct opposition to wealthy investors, property developers and construction companies, financial institutions and corporations, estate agents and landlords as well as politicians, both local and national, their servants in the police. In other words, it is a fight against global capitalism and the state; a fight for anarchist communism.
This article will examine both the causes of the attack on our cities and what we need to do to win the battle.It will focus mainly on London, which has its own peculiar situation as the centre of finance capital, but you will be able to find many similarities with other cities in Britain and the rest of the world. It is in two parts. The first part focuses on the issue of housing,the way in which capital is transforming homes into investment opportunities and the consequences of this for the working class in the city.
The second part will examine the general privatisation and control of all space in the city, turning every part of the city into a place for capital and excluding all who don’t produce profits or challenge the system in any way.
Regeneration: The working class evicted
One of the most significant signs of what is happening to our cities is the forcing out of the working class from areas of the city that are the target for money-making ventures. In London and many other cities, the centre and the immediate periphery are considered ‘prime’ property. This means that the working class is being pushed further and further out. It may go under the name of regeneration but what is happening is effectively social cleansing. It is at its most obvious in the slum clearances that occur regularly in the cities of the developing world. For example, the demolition of Zhejiang Village, the poorest area of Beijing, in 1995. It was a two-month operation involving 5,000 armed police and party cadres. In the end 9,917 homes were destroyed, 1,645 ‘illegal’ businesses were shut down and 18621 ‘illegal’ residents were deported. This might seem an extreme example, but there are certain similarities with Britain, with whole estates demolished and their residents ‘decanted’ no one knowing exactly where they went. This social cleansing is a consequence of both market forces and deliberate government policy. In Britain, there has traditionally been a mixture of people in different parts of the city, including the centre. This was because of the building of council housing on a massive scale in the 1930s and then after World War II. It wasn’t just the poor who lived in council homes,but many from the wider working class and even the middle class. Now, there is a move to create areas of the city that are exclusively for business, tourism, culture industries, and the super-rich.
Decimation of social housing
Council housing was decimated with Thatcher’s right to buy policy in the 1980s, which took millions of homes out of the public sector.Once the damage had been done, both physically and ideologically, the next governments, both Conservative and Labour, continued to sell of its housing stock.
With the economy in more or less constant crisis,governments sought ways of making the working class pay by finding ways of making cuts that would leave the rich untouched. Selling off housing stock to housing associations was a main way of doing this for local councils, who were being squeezed by central government cuts. By 2008, 170 councils had no housing stock left. Scotland has almost none left. By 2012 there were only 1.7 million council homes, but 2.4 million in housing associations.
Transferring the stock to housing associations was the first step to full privatisation. Housing associations are now in the process of going into ‘partnership’ with private developers,which usually means selling off a part of their stock to private developers in order to raise funds for the property that remains. The New Era Estate in Shoreditch, London fought and won against their so-called social landlord who was planning on selling off the estate to Westbrook, an American property developer. However, this is only one victory and there are countless other examples,often not fully publicised, of this kind of sell off on the part of social landlords. Councils are also quite happy to sell off their stock and evict tenants. The Fred John Towers in Leytonstone, London is currently fighting against their local authority who wants to sell one of the towers to private developers and move out the rest for 6 years whilst they renovate the other tower. The Aylesbury Estate in south London and the Carpenters Estate near the Olympic Park, both recently occupied by housing protesters, have been subject to gradual neglect and eviction of residents,with the aim of knocking the estates down and selling them off.
Another key policy introduced by Tony Blair was Pathfinder. This programme was designed to ‘create a housing market’ in so-called deprived areas across northern Britain. This means that it wanted to increase the demand for housing which would be seen in rising house prices. The fact that people are quite happy living where they are and don’t need or want housing market, seems to have escaped the politicians. For them, as always, it is about making money. Anna Minton in her book Ground Control documents the effects of this policy in detail. Whole terraces of houses, a mixture of council, social and private were allowed to run down, encouraging the council and social tenants to leave. Housing associations were known to pay tenants to go elsewhere. The end result was a few people left in the streets, giving the government the excuse to demolish all the houses and sell them off to private developers. Whole communities were decimated as a result. The new developments would be more attractive in theory and therefore there would be increased demand for them. Needless to say, the original residents would not be able to afford to buy any of the new homes.
With the right to buy, many of those being threatened with eviction owned their own homes. Ironically, the ‘home owner democracy’ counted for little when the state wanted to get its hands on their homes. The main weapon used was compulsory purchase. A new law was passed that enable the government to put out a Compulsory Purchase Order it was necessary for the economic benefit of the public. So if money was to be made, which supposedly would ‘trickle down’ to the public, then a CPO was justified.
These practices of evicting whole estates and streets shows the contempt that governments, ‘social’ landlords, and developers have for ordinary people.They don’t consider that, for individuals and families, the flats and houses that they are being moved from are their homes, part of a neighbourhood, and in some cases a close community. To think that it doesn’t matter as long as people have been moved somewhere,indicates either a conscious or unconscious desire to sabotage working class communities.
Rising house prices and rents
Another factor contributing to social cleansing, in London in particular, is the rise in house prices and rents. To understand why this is happening we need to take a step back and analyse the relationship of the housing market to capitalism. Capitalists are forever searching for new ways to make money. They may have made money out of production or resource extraction, eg the oil, but in some ways actually using the money made to produce something useful may be too hard and too slow. And they certainly don’t want to use their money to help alleviate world poverty. Whatever the reason, the main way that people make money is through the financial system, either investing in stocks or other speculative investments. With uncertainty around the stock market, property has increasingly been seen as a safe investment that would guarantee quick and lucrative returns. This has been the case even for the middle classes who have taken advantage of buy-to-let mortgages as an alternative to relying on a pension. As a result, the demand for property,not homes, has shot up and therefore with a limited supply, so have the prices both to buy and to rent.
The government has fuelled the rise in prices through their own policies. And there is a reason for this; the whole economy depends on rising house prices.This might seem odd, but given that Britain has very little manufacturing industry left to provide jobs and that most people are now worse off financially than they were a decade ago, there has to be a way of getting them to spend money. This is a fundamental contradiction of capitalism - they squeeze workers at the point of production, paying them as little as possible, but then want those same workers to be consumers! They have found the perfect solution - encourage them to take out a mortgage so they think they are home owners, keep house prices rising and they’ll think they are better off than they are. Capitalism then makes sure that credit is easily available to keep them spending and getting them further in debt.
This is what caused the crisis in 2008.
People started to default on their loans. However, the government bailed out the banks and soon it was business as usual as house prices rise. Though it is harder to get a mortgage than before, people are still encouraged to taken one on even if it means more debt. However, even the middle classes are beginning to suffer, and increasingly people who are not already on the property ladder are forced into rental accommodation. This increase in demand has pushed rents up as well as house prices in general.
The super-rich and the housing market
Linked to the rise in house prices in London is the influx of the world’s rich. In 2009, after the financial crisis had passed, there were 115 billionaires in China,101 in Russia, 55 in India in addition to 413 in the US and 32 in Britain. The incredible amount of wealth accumulated by some individuals is due largely to a transfer of wealth from the mass of the population. One percent of the population now own 50% of the world’s wealth. This was seen most blatantly in Russia, as the resources once owned by the State were gradually bought up at knock-down prices by a few individuals.
The Russian oligarchs came with suitcases full of roubles to London. Now it is the turn of the Chinese. The privatisation that took place in China has meant that some individuals have made big money through a combination of corruption and ruthless exploitation of their workforce, all enforced by the state.
These people need somewhere to put their money.They are not interested in putting it into something to help raise living standards of the world’s poor or even into producing a product. Apart from spending large amounts of their wealth on lavish lifestyles,they want their money to be safe and to make more money. London offers the ideal opportunity.
London has always been a world financial centre. It is a place for the rich to invest their money, allowing the banks to do what they want with it, as long as they make more money. The role of the financial sector in the British economy has increased in the last few decades. London’s deregulated financial system means that investors can get away with practices they wouldn’t be able to elsewhere. It is closely associated with the off-shore banking network in places like Jersey and Guernsey.
The taxation system favours the rich, with very low taxes on income and is also very favourable
to foreign investors.
They may be making money as a result of their investments, but if they can show that these investments, but if they can show that these investments are based elsewhere or that they are not permanent residents in Britain, they have to pay little or no tax. And, in case they are liable for tax, London has a booming tax “avoidance” industry.
Britain’s role as head of an empire has also played a role in attracting the world’s wealthy to London. The life style of the English aristocracy seems to be one that is sought after by many. Most of the world’s wealthiest people, both corporate executives and celebrities, have at least one property in Britain, usually in London, where they can come and play at being a lord or lady. The Russian oligarchs, arriving in force in the late 1990s, have managed to revitalise the yachting industry and increase sales in the luxury goods shops, not to mention the increased demand for private school places and nannies and butlers.
Politicians such as Boris Johnson and Ken Livingstone before him, went to great lengths to attract the rich to London. The justification for this is that there is a housing shortage and that they cannot afford to build new social housing because of the austerity measures. (They of course refuse to consider actually taxing all the wealth that has flooded into London, making the banks pay for their mistakes or cutting down on their war expenditure). The only way they say we can get new housing is by attracting private sector investment.
Therefore, they have offered up London on a plate to the super-rich and global corporations. Developers are having a field day, with new housing developments even in previously “undesirable” areas.
Most of them are then being sold to foreign investors,hoping to make a killing out of the rising prices and soaring rents. There is a minimal amount of affordable housing which is actually not affordable, but 80% of market rents, so none of these developments are within the reach of the average Londoner and certainly not the poorest. They may rent some of the units out to the lawyers, accountants, bankers, other well-off professionals, and even tourists, but many of the units will remain empty, now known as ‘buy-to-sit’. There are whole streets in Chelsea and Kensington that have no lights on at night. It is estimated that 20% of this borough consists of empty properties.
Therefore, the demand for cheaper housing by everyone else, including councils for their large homeless populations, is higher than supply. As a result private landlords step in and charge the maximum they can get away with, cut back on repairs and improvements, and/or squash more people into the property than it can reasonably hold. If anyone is made homeless, the council is quick to try and move them out of the central London boroughs or out of London completely. Housing benefit levels are too low to be able to rent properties in most parts of London.
Therefore, social cleansing is a consequence of shortage social housing, rising house prices and rents, all of which are caused by the need of capital to make money out of the city.
Apartheid in the city
It is important to grasp that we dealing here with a fundamental reorganisation of metropolitan space, involving a drastic diminution of the intersections between the lives of the rich and poor.
It is not just a question of moving the working class further out from the city centre. Many of the well-off do not want to live in the centre in a high rise flat. They may have one for work, but if they have a family they are more likely to move to the leafy suburbs.
This is already the case in the US where there has been a massive exodus of the upper and middle classes from downtown. In Britain, there still is a tendency for the well-off to prefer a more centrally located house, but we are still witnessing moves outside of London to a large house or mansion in Surrey. So it is not just a question of moving the working class out of the centre but of making sure that the working class, especially the ‘undeserving poor’, do not ‘contaminate’ other social classes. Many local councils support regeneration by saying they want a better ‘mix’ of residents. However, this is only so they can get the better-off residents into the area. This ‘mix’ is deceptive. The new developments are often versions of gated communities. This idea started in the US but has taken off in other parts of the world. These gated communities separate off the rich and the middle class from the ‘dangerous’ masses. These could be city centre developments with high level security systems or they may be special communities in the suburbs, which are linked to the centre by special transport systems.
New residential ‘towers’ are springing up in key areas of London. Some are along the Thames in central London whilst others are in and around Canary Wharf, Liverpool St, and Stratford.
In theory every development is meant to have some ‘affordable’ housing or make some contribution to the community, such as a health centre. Developers are increasingly finding ways of avoiding having to provide any affordable, and certainly not social, housing. They will often pay the council a sum of money as a contribution to their social housing fund. They then can promote their development as ‘completely private’ to their potential clients, assuring them that they won’t have to mix with the riff-raff! Meanwhile, the council doesn’t use the money for any social housing. If the developers do end up providing some cheaper housing, they will put in separate entrances (”poor doors”), the subject of an on-going campaign at 1 Commercial St in Aldgate, London.
In some of the developing countries, in which the extremes of rich and poor are much greater and therefore more frightening for the rich, gated communities are the norm. In Planet of the Slums, Mike Davis documents the rise of what he calls ‘off-worlds’ - a term taken from the film Blade Runner.
Whole suburbs are built which completely isolate the well-off from the mass of the population. These are often modelled after places in southern California. Cairo has Beverly Hills, Beijing has Orange County, and Hong Kong has Palm Springs.
These may be actual places in southern California,but for the rich of the developing world they are brand names which are symbolic of wealth, status, and exclusivity. They are surrounded by high fences and tight security. They are connected to the financial and business centres by super highways that provide a safe corridor between their suburban mansion and their place of work, though many of these places are now incorporating business headquarters as well.According to Jeremy Seabrook, quoted in Davis: ‘the Third World bourgeoisie cease to be citizens of their own country and become nomads belonging to, and owing allegiance to a superterrestrial topography of money; they become patriots of wealth, nationalists of an exclusive and golden nowhere’. (p.120)
Therefore, the rich are separated not just from the rest of the population but also from the reality of the country itself. There are similarities with the foreign investors in London.
The Russian oligarchs may ape the life-style of the British upper classes but they have no interest in Britain or its people.
They live a life of luxury on their yacht or Chelsea mansion with the wives shopping at Harrods, but that is as far as the connection goes (apart from bribing our politicians!). The planned development at the Royal Albert Docks is another case in point. Boris Johnson sold the whole area to a Chinese company without any opportunity for British companies to even bid. The aim is to establish an ‘East Asian enclave’ in Newham, one of the poorest boroughs of London. This will be another Canary Wharf where East Asian executives will be able to conduct their business without even having to mix with their British counterparts! It is similar to what the Europeans did in China in the 19th and early 20th century with their special enclaves in places like Shanghai.
It is not possible to exclude the working masses completely. After all, who will do the cleaning? Who will do the lowly office jobs and staff the restaurants? In the developing countries the problem is solved by having people live in special accommodation near their work. So maids will sleep in the garden shed or the basement of the exclusive suburbs, and rural migrant workers will stay in factory dormitories. These workers have no right of residence and even if they did, they wouldn’t be able to afford the prices. Or, the workers will live in the slums, shanty towns that they set up themselves in order to be near work. They are safe as long as the rich are protected from these slums in their high security suburbs or until the land they are on is wanted for yet another money-making opportunity.
In Britain, workers have two choices. They can live close to their work in sub-standard and over-crowded conditions, paying at least half their salary in rent, or they can move further out and spend more money and time commuting. The point here is that capital does not bear any of the cost of this - it is the workers’ time and money that is being spent getting to work. And, if the workers decide to live closer, capital also wins by making huge profits on the rent paid.
People are fighting back. There have been a number of campaigns against all aspects of the attack on working class housing in the city. The Pathfinder project produced campaigns that went on for years, such as the Derker Community Action Group in Oldham or Elizabeth Pascoe’s fight in North Liverpool (see Anna Minton’s Ground Control for more detail). In London, the residents left on the Carpenters Estate in Stratford, east London managed to fight off the plans of the University of London to take over the estate and build a branch of the university.
Campaigners in West Hendon estate in North London have managed to keep their homes for years, despite the constant threat of eviction.New Era estate in Shoreditch, London mounted one of the most successful campaigns.They managed to ‘persuade’ the US development company Westbrook to abandon attempts to turn the property into up-scale private flats and now the estate is to be turned over to a social housing association.
Currently new campaigns are springing up around London, such as the Aylesbury Estate in south London. Even though squatting residential properties is now a criminal offence, they are using occupation as a tool in the struggle, physically taking over empty flats.
Campaigns are also fighting individual evictions and against private landlords. Focus E15, who ran a successful campaign to get 29 single mothers rehoused in the local area rather than being sent out of London, continues to fight individual cases and also organised a militant protest at the British Credit Awards (aka the ‘Bailiff’s Ball’). Solidarity networks are also being set up (eg. in Glasgow and Bristol), a way of supporting individuals who are facing any housing problem such as losing a deposit or landlord refusal to do repairs. Private renter groups are also being organised, tackling issues such as rent rises.
The struggles have had different degrees of success. What are the common ingredients?
Campaigns that focus on one individual landlord or situation tend to do well. This is partially because it is possible for the landlord, or council, to give in on one case more easily than a campaign that is fighting evictions or other problems on the level of the whole estate.
However, these campaigns also have had victories because of the tactics used: direct action - taking the fight directly to the landlord or council. Focus E15 has been relentless in their attack on Newham council and the mayor Robin Wales, recently winning a case against him for verbal abuse of two of the young mothers at the heart of the campaign. The yalso mounted an occupation of Carpenters Estate and have been making links with and encouraging other campaigns in the area. Though a political organisation, the Revolutionary Communist Group,has been involved in the campaign from the beginning and their paper is frequently to be seen on all events, their message is that it must be those directly involved, the residents themselves, who take charge of the campaign. Those who come along to the stall or one of the actions are there to support and not take over or substitute themselves for the estate residents or individual facing eviction.
The lack of support from residents is one of the key weaknesses of some of the other campaigns. The Aylesbury occupation came about as a result of the March for Homes with some activists,many from the squatting movement,thinking about what action they could take to make the struggle more effective than a march from A to B.
They were aware of the need to get residents on their side and there are some directly involved in the occupation. They say that there is ‘passive’ support for the occupation but the campaign would be much stronger if it was based on the residents themselves with support from the occupiers, rather than the occupiers trying to get support after they have already occupied and are then busy trying to maintain the occupation and fight off the police. However, the estate itself has been in the process of being ‘decanted’ for some time so that in many ways it is difficult to build up support. That is the problem with fighting whole estate evictions. Often the process is gradual, and if the residents themselves aren’t organised and ready to fight, the estate is almost empty before housing activists find out about what is going on. This doesn’t mean that these occupations are not worth doing -they are a good way of raising awareness of what is going on and provide a focal point for struggles in the local area - it is just that to actually win, the residents need to still be living there and wanting to fight.
The New Era campaign demonstrates a combination of successful tactics. The residents started organising themselves many months before local activists became involved to support. This meant that they were already well-organised and united and could be at the centre of their campaign. There was no need to win over the residents because they already were fighting. The other tactic is the way in which they took the struggle direct to the developer. They made links with Westbrook tenants in America which embarrassed Westbrook. In the end, a big property developer like Westbrook didn’t want the hassle and pulled out. Another positive feature of the growing housing struggle is the fact that many of the campaigns are beginning to make links. The Radical Housing Network in London brings together several local campaigns as a way of giving each other support, as well as organising united action against common enemies. For example, they organised a successful protest outside the international property developers fair MIPIM last October and a week of action ending with a protest against Boris Johnson and his budget in February.
As shown in this article, the problems are much larger than the council refusing to build more council houses and selling off their properties to private developers. In fact, it may not even be necessary to build more homes, which will only use up more land that could be used for open public space such as parks. It is more a matter of redistribution of the empty properties that are there, for example the takeover of the empty mansions, and the transformation of all the empty office blocks into housing.
In addition, we shouldn’t be uncritical of both council and social housing.Council housing in its early years was about the provision of housing for the ‘deserving’ poor and itself involved social cleansing of the ‘slums’. In addition, just because housing is owned by the state does not make it in itself desirable.
The state can also be a bad landlord, which is why so many tenants did not put up much of a fight when council housing was sold off to residents or transferred to social landlords. Though many people have good memories of the sense of communities on council estates, it depended very much on which estate. However, the sale to social landlords, the housing associations, has proved to be a disaster. Though councils themselves have sold off property to private developers, it is much more likely to happen under a so-called social landlord. These landlords have had money cut by central government which has exacerbated the tendency for them to transform themselves into private corporations, putting rents up, selling off properties, and/or going into ‘partnership’ with private developers. What
counts more than the type of tenure, is the degree of organisation of tenants and residents.It is probably easier to organise if the landlord is the council, which is the main reason why it is still a worthy demand. However, the focus of all campaigns must be to strengthen the self-organisation of the tenants and residents themselves, no matter who the landlord is.
Though we still need to target councils and make the demands, we must begin to widen the scope of the campaign and fight both the developers and the foreign investors who are buying up properties.
As long as cities are held hostage to capital and the need to make money out of the city, any council is going to face strong pressure to accept the logic of private investment. Not only are their funds limited by central government itself, but the power of companies and individuals worth millions must be a great temptation for the politicians. In other words, the fight is against global capitalism itself and the State which facilitates the takeover of the city.
The above originally appeared in issue No.84 of Organise! magazine of the Anarchist Federation