Winner-takes-all urbanism and superstar cities: on Richard Florida’s “New Urban Crisis”

Richard Florida speaking in 2011. Image: Getty.

The city, the late political theorist Benjamin Barber argued in his 2013 book If Mayors Ruled The World, would be our salvation: while nations concerned themselves with sovereignty, wars, and other forms of political dick-waving, it would be cities that would have to address global problems such as climate change.

There was, though, a slight kink in this argument: a big reason cities were best placed to reduce emissions was because cities were producing most of them. The city, as Barber himself acknowledged, has always been an ambiguous and contradictory idea – representing, on the one hand, civilisation, opportunity and freedom; on the other, decadence, poverty, isolation. There’s little point trying to work out which view is correct, since clearly both are. The true meaning of the city is simply a matter of taste.

It’s another contradiction that’s at the heart of The New Urban Crisis, the latest manifesto from Richard Florida, an American  urbanist and guru of the “creative city” approach to urban regeneration. Cities now house around 55 per cent of the world’s population; the most successful – London, New York, San Francisco – are today as sought after as ever, sources of growth, innovation and cultural vibrancy.

So used are we to this state of affairs that it’s easy to forget how big and how recent a turnaround this is. Just a generation ago these same cities were characterised by industrial decline, crime and depopulation as their citizens fled to the suburbs. Between 1939 and 1988, London lost a quarter of its population.

In the 1990s, that changed. Living downtown became aspirational again – I’ve always suspected New York sitcoms to be the culprit, although the departure of foul-smelling industries should probably get some credit, too. Crime fell; populations rose. Today, while Britain’s international stature may have faltered, London is one of the few serious candidates for most important city in the world. Together, Florida says, these “superstar cities” are so successful that, with just 7 per cent of the world’s population, they can generate 40 per cent of its GDP. It’s stirring stuff.

That’s the good news. The bad – the crisis of the book’s title – is a messy set of connected problems. One is the failure of urbanism in the developing world where, in contrast to earlier phases of history, cities are booming without much in the way of economic growth. Florida credits this, as he does so much else, to globalisation: why develop your own resources when you can just buy them in?


Another concern is the scale of the drop off between the most successful cities and the rest. In a pattern familiar in the UK, the ambitious, talented and creative are drawn to those centres where productivity, and wages, are highest. The resulting brain drain makes it even harder for the places they leave behind to catch up.

This “winner-takes-all urbanism”, as Florida terms it, would be bad enough if the two sides contained equal numbers of cities, but they don’t: the few-dozen cities with high wages and booming tech scenes are dwarfed in number by those where wages are low, deindustrialisation is still a concern, and the new urban crisis looks a lot like the old one. The cities in the latter group include many that were recently unexpectedly enthusiastic for Brexit on one side of the Atlantic, and for Donald Trump on the other.

Perhaps the biggest issue of Florida’s new urban crisis, though, is that winner-takes-all urbanism doesn’t even seem to be working for the people who live in the superstar cities. The clustering of economic activity in a relatively small number of cities has sent land values through the roof. The result is that, even though average wages are higher, after housing costs the poor are effectively worse off in New York than in, say, Houston.

Not for the first time we’ve managed to construct an economic system that’s brilliant for wealthy landowners but terrible for pretty much everyone else. “Class today,” Florida writes, “is not just about the kind of work we do, but also the places in which we live, which shape everything from our access to jobs to the schools our kids attend and our prospects for upward mobility.” It’s a sort of Marxist theory of place.

Like the problems Florida identifies, his solutions are many, varied and intimidating. They include a land-value tax and better public transport, to enable more people to live and work in these big, productive cities; a new generation of subsidised housing for key workers in danger of being priced out of places that wouldn’t survive their departure; higher minimum wages and even that perennial favourite, a universal basic income.

It’s not that these ideas are bad, or unambitious: quite the opposite. What’s not clear is how we would implement them. There are still some winners in the current system – and those who can afford to grab a slice of the superstar cities include much of the West’s dominant political class.

Florida’s new urban crisis is, he claims “the defining issue – and struggle – of our time”. Perhaps he’s right. But while one side of that struggle has the numbers, the other wields all the power. We may be struggling with these particular urban contradictions for some time to come.

“The New Urban Crisis: Gentrification, Housing Bubbles, Growing Inequality and What We Can Do About It” by Richard Florida is published by Oneworld.

This review originally appeared in our parent publication, the New Statesman.

 
 
 
 

There isn’t a single national housing market – so we need multiple models of local regeneration, too

Rochdale. Image: Getty.

This week’s budget comes ten years after the 2007 financial crisis. The trigger for that crisis was a loss in confidence in mortgages for homes, with banks suddenly recognising the vulnerability of loans on their books.

In the last ten years, the UK’s cities and regions have followed very different paths. This week’s focus on housing affordability is welcome, but it will be a challenge for any chancellor in the coming decade to use national policy to help towns up and down the country. Local housing markets differ drastically. The new crop of city-region mayors are recognising this, as rents in parts of south Greater Manchester are on average double the rents in parts of the north of the city-region.

When it comes to buying a home, politicians are increasingly articulate about the consequences of inequity in our housing system. But we must recognise that, for 9m citizens who live in social rented homes, the prospects of improvements to properties, common areas and grounds are usually tied to wider projects to create new housing within existing estates – sometimes involving complete demolition and rebuilding.

While the Conservative governments of the 1980s shrank the scale of direct investment in building homes for social rent, the Labour governments from the late 1990s used a sustained period of growth in property prices to champion a new model: affordable housing was to be paid for by policies which required contributions to go to housing associations. Effectively, the funding for new affordable housing and refurbished social homes was part of the profit from market housing built next door, on the same turf; a large programme of government investment also brought millions of social rented homes up to a decent standard.

This cross-subsidy model was always flawed. Most fundamentally, it relies on rising property prices – which it is neither desirable nor realistic to expect. Building more social homes became dependent on ratcheting up prices and securing more private profit. In London, we are starting to see that model come apart at the seams.

The inevitable result has been that with long social housing waiting lists and rocketing market prices, new developments have too often ended up as segregated local communities, home to both the richest and the poorest. They may live side by side, but as the RSA concluded earlier this year, investment in the social infrastructure and community development to help neighbours integrate has too often been lacking. Several regeneration schemes that soldiered on through the downturn did so by building more private homes and fewer social rented homes than existed before, or by taking advantage of more generous legal definitions of what counts as ‘affordable housing’ – or both.

A rough guide to how house prices have changed since 2007: each hexagon is a constituency. You can explore the full version at ODI Leeds.

In most of England’s cities, the story does not appear to be heading for the dramatic crescendo high court showdowns that now haunt both developers and communities in the capital. In fact, for most social housing estates in most places outside London, national government should recognise that the whole story looks very different. As austerity measures have tightened budgets for providers of social housing, budgets to refurbish ageing homes are under pressure to do more with less. With an uncertain outlook for property prices, as well as ample brownfield and greenfield housing sites, estates in many northern towns are not a priority for private investors in property development.

In many towns and cities – across the North and the Midlands – the challenges of a poor quality built environment, a poor choice of homes in the local are, and entrenched deprivation remain serious. The recent reclassification of housing associations into the private sector doesn’t make investing in repairs and renewal more profitable. The bespoke ‘housing deals’ announced show that the government is willing to invest directly – but there is anxiety that devolution to combined authorities simply creates another organisation that needs to prioritise building new homes over the renewal of existing neighbourhoods.


In Rochdale, the RSA is working with local mutual housing society RBH to plan for physical, social and economic regeneration at the same time. Importantly, we are making the case – with input from the community of residents themselves – that significant investment in improving employment for residents might itself save the public purse enough money to pay for itself in the long-run.

Lots of services are already effective at helping people find work and start a job. But for those for whom job searching feels out of reach, we are learning from Rochdale Borough Council’s pioneering work that the journey to work can only come from trusting, personal relationships. We hear time and again about the demoralising effect of benefits sanctions and penalties. We are considering an alternative provision of welfare payments, as are other authorities in the UK. Importantly, residents are identifying clearly the particular new challenges created by new forms of modern employment and the type of work available locally: this is a town where JD Sports is hiring 1000 additional workers to fulfil Black Friday orders at its warehouse.

In neighbourhoods like Rochdale’s town centre, both national government and the new devolved city-region administration are considering an approach to neighbourhood change that works for both people and place together. Redevelopment of the built environment is recognised as just one aspect of improving people’s quality of life. Residents themselves will tell you quality jobs and community facilities are their priority. But without a wider range of housing choices and neighbourhood investment locally, success in supporting residents to achieve rising incomes will mean many residents are likely to leave places like Rochdale town centre altogether.

Meaningful change happen won’t happen without patience and trust: between agencies in the public sector, between tenants and landlords, and between citizens and the leaders of cities. This applies as much to our planning system as it does to our complex skills and employment system.

Trust builds slowly and erodes quickly. As with our other projects at the RSA, we are convinced that listening and engaging citizens will improve policy-making. Most of those involved in regeneration know this better than anyone. But at the national level we need to recognise that, just as the labour market and the housing market vary dramatically from place to place, there isn’t a single national story which represents how communities feel about local regeneration.

Jonathan Schifferes is interim Director, Public Services and Communities, at the Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA).