housing in development

Is Norman Foster selling his soul?

2010-01-15T15:25:00.000-08:00

Foster Associates designed a ‘signature building’ (the ‘Leaf’) as part of a commercial redevelopment proposal in the London suburb of Ealing in 2007. Brought in presumably to lend a certain ‘caché’ to the otherwise uninspiring and vastly overdeveloped project near the Ealing Broadway Station, the proposal was slammed by English Heritage and CABE as well as local residents and community groups. In response, the developers, Glenkerrin, made a few changes, lowering the height of the main Foster designed tower from a massive 40 floors (just below the Heathrow flight path!) to 27 floors and resubmitted it.

Foster has made a name for himself by designing iconic buildings like the ‘Gherkin’ office block in central London and no doubt the developers thought the local residents would be naïve enough to value having a well known architect gracing their neighbourhood, even if it was the wrong building in the wrong place. Despite Ealing Council approving the revised scheme, it was called in by the government and after a public inquiry, the inspector recommended rejection and this advice was accepted by the Secretary of State, a rare example of central government reflecting local community interests against those of its own council.

But Foster is probably too busy to notice his rejection by the suburban upstarts in Ealing. According to today’s television programme by Kevin McCloud (Slumming it - India’, Channel 4), he is one of a number of leading international architects lending their names to the redevelopment of one of the largest slums in Asia, Dharavi in Mumbai. Dharavi is a massive slum, housing well over 600,000 mostly poor people living at extremely high densities, but generating livelihoods for so many it is helping keep Mumbai’s economy afloat and certainly does most of the city’s dirty business, like recycling its wastes. Yet, as in Ealing, developers are anxious to get their hands on the land in order to redevelop Dharavi and turn it into shopping malls and offices with high-rise apartments for some of the existing residents.

Foster will be part of this ‘makeover’, helping to impose commercially profitable versions of urban life for an affluent minority at the expense of the poor majority. If he has been advised that this is really in the interests of the poor, or even the long term interests of Mumbai, then perhaps he should select some new advisers. If he is doing this in full knowledge of the social, cultural and economic impacts such an approach will have on the poor, then it suggests he has wilfully turned his back on what is really needed and has, indeed, sold his soul. Call me a NIMBY, but it’s not the sort of icon I would want in my backyard.

Social housing makes a comeback in UK

2009-09-28T11:16:00.000-07:00

A survey of 21,000 social housing tenants in the UK has shown that just 12% want to exercise their legal right to buy, down from 32% a decade ago. In addition, 8 out of 10 tenants are satisfied with their social landlord and believe that their status is better than owning a home or renting privately.

Huw Morris, editor of the weekly journal 'Planning' concludes that "a sizeable proportion of the population, it is clear, has no wish to own a home". This suggests that the politically inspired drive to create a 'property owning democracy' has finally run out of steam amid a recognition that other tenure options have benefits.

The challenge is now for all those involved in housing supply - government, parastatals, designers and developers, to create homes and neighbourhoods that people want to live in and can afford - an exciting outcome from the housing crisis!

Attention-seeking architecture

2009-09-20T14:18:00.000-07:00

Off to Manchester to see some projects by the innovative developers Urban Splash. They have made their mark by redeveloping old areas or buildings and putting creative packages of funding together. Despite the recession, they are keeping busy.

Manchester Piccadilly station is all one expects of the city that is home to wealthy Premiership football teams - all glass, steel and marble, with cappucinos and brioches readily available. However, once outside the station and beyond the inner circle of magnificent Victorian offices and warehouses, the scene gives way to a collection of brash new structures which seem to have no sense of context, but which shout at each other as though to claim that they are bigger and better than their neighbours. The fact that these new buildings are not trying to be good neighbours to each other, but competing for attention across derelict sites, suggests a society in which individualism has run riot and any sense of community has been long forgotten.

It is not all bad news. There are areas where public space has woven a thread of continuity between buildings and the regeneration of sections of the canal, replete with brilliantly painted narrowboats, moored under vast steel viaducts or bridges, offers a pleasant route for people to walk to work and relax in canalside restaurants and bars.

One of Urban Splash's new schemes also combines the best of the old with the best of the new. Their Chimney Pots scheme takes an area of Victorian terraces identical to those in Coronation Street that the Council wanted demolished because it had sunk into a state of total social and physical decay and turned it into an enclave for which people camped out three nights in order to make sure they were able to buy one.

The ingenuity of the project is that it retained the overall street pattern and frontages of the old terraces, but inverted the interior so the bedrooms are are on the ground floor and the living rooms are upstairs (see http://www.urbansplash.co.uk/chimneypotpark/ for details). The master-stroke was to then put car parking between the backs of the houses and build over these to create individual and communal garden terraces at first floor level. The design combines personal and communal living within individual dwellings for the grand sum of £99,000 each, making it easy to see why people camped for three nights in order to by first in the queue to get one.

The other project visited left a far less favourable impression. Designed by the prestigious architectural practice of Will Alsop, the Chips project in New Islington is a nine storey slab surrounded on three sides by water. http://www.urbansplash.co.uk/documents/brochure/US_RESI_GUIDE_100019.pdf
The ground floor is intended for commercial use and the upper floors for housing, to be sold on the open market. At the time of our visit, the commercial areas were unlet and only a small proportion of the apartments had been sold. It is not difficult to see why.

The scheme is approached across a derelict wasteland where a hospital once stood. The roofless shells of the original Victorian buildings lie waiting for eventual restoration and conversion, against which the new building is alien in scale and brash in appearance. Approaching the entrance, one notices that the entire building appears to be clad in some form of fibre board fixed with screws covered with plastic caps and separated by a recessed layer of aluminium foil which looks identical to the bacofoil used in cooking. Not only does this look trashy, but it has already been pierced by curious fingers or incompetent workers, so has lost its insulating qualities before the building has even been fully occupied.

The interiors also leave a lot to be desired. Exposed concrete ceilings may make a fashionable design statement in architectural magazines, but they don't provide the most attractive thing to see when you wake up in the morning. Nails sticking out of these on the balconies of some units also suggest that this is more a means of saving cash than achieving cachet. Finally, the internal layouts leave a lot to be desired with main doors opening directly onto bedrooms and corridors weaving around kitchens rather than leading to them. As for the narrow, glass fronted balconies, I would certainly not want children anywhere near them. But of course, the housing is probably not designed for children, but to impress other architects. This no doubt explains why the Chips project (named because it resembled three fat chips laid one above the other) has been nominated for the World Architecture Festival Awards! A case of chips with sauce?

Are lower house prices bad news?

2009-05-12T01:25:00.000-07:00

BBC Radio 4's flagship 'Today' programme today discussed the UK economy and indicated that there were signs that the fall in house prices may have ceased and are possibly increasing 'at last'. It seems to be widely assumed that a fall in house prices is a bad thing, mainly because of the risk that some people will fall into negative equity as the value of theiur properties becomes less than the size of their mortgages.

In this sense, housing is possibly unique. If I want to buy something desirable, say a new car, a reduction in prices can be considered a good thing - I pay less and more people can afford the item. In fact, a reduction in prices is widely considered desirable for the development of affluence and the reduction fo poverty.

The reason that housing is considered different is down to two main reasons.First, tax and other financial incentives have encouraged more people to become home owners than tenants, so that approximately 70% of all households currently own their homes in the UK. As a majority has been created, home owners inwevitably represent a powerful voice seeking to protect the value of their assets, creating the impression that a reduction in asset values is bad. Yet for the young or less well off wanting to get on the ladder and join the party, a reduction is prices would be highly attractive. What we are witnessing is the media reflecting the interests of the majority, not the most deserving minority assuming, of course, that home ownership is desirable for all in the first place.

The other reason that makes housing different from other assets is that the price is not related to whether they are new or old. With any other commodity or necessity of life, (perhaps except wine!) new ones tend to be more valuable than old ones. With homes, older ones may actually be considered more desirable than new ones, so that depreciation does not apply.

These two factors encourage the assumption that property price increases are natural and desirable. It would be good to think that the current economic crisis might give cause to revise such assumptions and encourage a view that property prices should not be so important that they are regarded as a barometer of economic wellbeing. It might also serve to remind us that what is bad for some groups, is actually very welcome for others. The media, and particularly the BBC, should perhaps acknowledge this more.

Rescuing the housing market

2009-04-01T03:14:00.000-07:00

At a meeting in the British Academy yesterday (31 March) details of which are available at: http://www.britac.ac.uk/events/2009/housing/index.cfm) Professor Susan Smith of Durham University’s Institute of Advanced Study chaired a meeting of housing experts from UK and Australia to consider issues and options relating to the current housing crisis. As she stated in the introduction to the meeting, the current housing dislocation is of global proportions, though it has to be said that almost all the presentations and subsequent discussion focused on the situation in the UK, USA and Australia.

The first speaker, Professor Gavin Wood of RMIT, Melbourne, reminded the audience that 30 years ago mortgage lending was undertaken by building societies or banks on the basis of loans financed by savings or deposits and the risks were borne at the local level – the buck stopped with the local manager. As a result, a relatively closed mortgage market operated. In the last two decades, risk has been increasingly spread making mortgages cheaper through competition and stimulating demand.

As the equity in the housing market increased, so did the trend for owners to withdraw some of the equity in their properties. Professor Wood claimed that this was not necessarily to sustain a champagne lifestyle, but to meet routine needs. This is not my experience - many people I know started to live above their means as a result of their new-found housing wealth. When foreclosures started after 2005 this severely depressed prices and equity values dropped accordingly. Did this contribute to increases in credit card debt as people then sought to maintain their newly acquired taste for the high life by any means available?

Professor Susan Whitehead of LSE and Cambridge University introduced her talk by saying she was old enough to remember her first mortgage when access was restricted and had no desire to see a return to those days, though she didn’t say why. She even claimed that market volatility was even greater then than now, though that is not what I remember. She presented the case for shared equity systems as a means of increasing access to affordable housing by people wanting to get on the housing ladder whilst spreading the risk – and benefits. Whilst shared equity is certainly an attractive option, Professor Whitehead acknowledged that it a major reason for its popularity is that it “goes with the grain of individual ownership”.

For me, the surprise was that this was the only alternative mentioned to home ownership. All the speakers seemed to assume that ownership was the preferred option, despite the fact that it is a far lower proportion of all tenure categories in Germany and their economy is weathering the crisis better than that of the USA or UK (Euro problems aside). No mention was made of co-operative housing, public or private rental, or other means of diversifying housing supply to meet the needs of a diverse demand system.

The implication of the presentations was that home ownership is best and that alternatives are probably restricted to flats/apartments in inner cities for the young. This was a profoundly restricted view of the housing crisis facing the UK and USA as I consider it, and does not suggest that these experts should be allowed to have any influence over countries with very different situations, such as developing countries. Sadly, they all too often take their lead from the USA and UK, especially when home ownership and land titling programmes are being so actively promoted by international donor agencies.

Home ownership has been widely promoted in the UK – and internationally – for largely political reasons. In the UK, mortgage tax relief for many years gave financial benefits to those seeking to “get on the housing ladder” (until such artificially stimulated demand led to inflationary prices which negated the benefits and it was dropped). Such benefits were not available to those in social housing, so Thatcher encouraged council tenants to become owners through the ‘right to buy’ programme. The carrot to tempt tenants to become owners was a heavily discounted price (selling off public assets at a knock-down price) and the political objective was to increase the constituency of support for the Conservative party as the one which would protect home owners.

In other words, the housing market has been biased for many years in favour of home ownership and this has attracted a massive level of investment, much of it speculative, rather than based on the desire for living in a decent home. Such a tendency for housing to become yet another market commodity has contributed to market volatility and financial and economic crisis. We do not need help for home owners – we need help to improve the diversity of supply options. Such a diverse system of housing supply is more likely to meet the needs of the UK and USA – and is particularly relevant for developing countries.

2009-02-26T04:03:00.000-08:00

I thought this would be of interest to all those curious about urban development in China. It is from Access Asia (www.accessasia.co.uk) for those who would like more (I appreciate their permission to reprint):

The China Luxury Game...Played with Different Rules

In the West, the luxury business has slumped alarmingly. Yet in China, stores keep opening and the luxury brands and mall owners keep on pumping out the good news press releases. But when anyone visits these malls and stores they're empty, and the staff are standing around picking their noses. So, what's going on, you might reasonably ask? And it seems set to continue. We know of at least three high-end mall projects, attracting luxury brands in Beijing, set to go ahead and with secured funding. Then there's Japan's Takashimaya upscale department store, which has just announced a 40,000 square metre (yes, that's right 40,000!) store in a Shanghai suburb. Over Chinese New Year, Louis Vuitton opened a flagship store in Taiyuan, a city most fashionistas would have trouble finding on a map. Meanwhile, last week, a sale of luxury goods in Macao led to fist fights among brawling women from the Mainland and Hong Kong Hell-bent on snapping up glitzy bargains. So here's how it can work... A property developer approaches a local authority with a plan to build a luxury high-end mall. Lots of talk of "international", "luxury", "lifestyle", etc. The local officials like the idea and tell the bank so; the bank manager (a Party member of course) lends the money (rather softly) to the developer. The developer then gets lots of migrant workers to build the mall, and subsequently fills it with luxury brands (who don't have to pay much in the way of rent or service charges). And hey presto, another luxury mall appears. All this, of course, depends on the following:
· A developer who's not really a developer, in the traditional sense, but who can build a mall, but get a larger loan, thereby trousering the difference between the total loan value and the cost of construction (while hopefully quickly flipping the project and selling it for a profit soon after completion);
· A bank that isn't really a bank, in the traditional sense, in that it make loans based more on policy considerations than financial ones, and takes advise from the local officials;
· Brands that, in China at least, aren't retailers, in the traditional sense, but want shop windows in China for advertising to encourage purchasing by local consumers when they go to duty free Hong Kong, Macao or wherever;
· Local officials who are driven by pride more than reality, and need to be able to claim they are making their tier-2 or -3 city (or tier-1 city district) more "international" and "modern", and who also have retail development targets to meet, friends who are property developers and comrades who are bankers;
· Central government officials who share the aims of the local officials above, but more so in terms of striving for a perceived "internationalism";
· Customers, who aren't really customers in the traditional sense, in that they are just looking before they go to buy in Hong Kong or elsewhere. So, we get the malls, the brands and the supposed prestige. The developer gets a payday maybe; the bank gets to lend where it's told; migrant workers get to migrate and work and local officials look good higher up the chain, while the top of the chain gets to claim China has more luxury stores than anywhere else, as well as faster trains, longer bridges, and so on, and so on. And, the FT gets to hold a silly luxury conference every year that says the same thing. Everyone's happy - who needs customers!! Leslie Chang's excellent new book Factory Girls contains a sign she saw somewhere that said something like "Let's build more power stations, roads and bridges so we can profit and make more power stations, roads and bridges". We're all familiar with this from the USSR, and so on. What makes you think it's any different with luxury malls? The truth is - it isn't. Existence is everything; turnover secondary. Now get out there and shop!

The elephant and the mouse

2008-12-28T11:53:00.000-08:00

There was once an elephant and a mouse living next door to each other. Now although the elephant was the largest and strongest of creatures, it did not know much about the world and was actually scared of things that were different, even mice. Naturally, the mouse had to spend most of its time and energy avoiding being trampled by the elephant. As a result, it became quick-witted and adaptable, but had no energy left to grow strong and healthy.

One night, the elephant had a dream that it need not be scared of other things and woke up determined that change was possible. The mouse, whose name was Cuba, was very happy at the idea that they might actually be able to live peacefully together as neighbours.

Cubans are nothing if not realistic. Whilst they have hopes that Obama may relax the embargo which has crippled the Cuban economy for several decades, they realise that the older Cuban-Americans, who are vehemently opposed to any change, still exert influence in US politics, even though younger ones are so integrated into US society that they have no interest in returning to Cuba or opposing change.

The US imposed embargo has had a serious impact on the Cuban economy by reducing opportunities for international trade and forcing the country to live by its wits with minimal natural resources. Despite these constraints, Cuba has much of which to be proud. The civil defence system is arguably the best in the world in that although two of the worst hurricanes in recent memory, (Gustavo and Ike), destroyed over half a million houses and large areas of tobacco and other agricultural products, only about two people died as a direct result and these were reportedly due to people leaving shelters. Whilst the mayor of New Orleans was boasting on CNN that the city had successfully evacuated a few thousand people to areas of safety, no mention was made of the fact that Cuba successfully protected over 300,000 people. The country has a vibrant culture and its health and educational systems have enabled the country to equal the US in terms of Human Development Indicators (a more useful guide to social wellbeing than GDP, since they measure infant mortality, levels of literacy and life expectancy, etc).

However, it should also be acknowledged that domestic economic management in Cuba has been a failure. Vast tracts of fertile land remain uncultivated, since farmers understandably see no point in working hard if they are forced to sell most of their produce to the state for a pittance. Similarly, joint ventures with foreign investors often fail if the Cuban government suspects that they are making what are considered excessive profits, or if an investor falls out of favour.

During a recent visit to Cuba, nobody spoke about Fidel in other than positive terms. It was acknowledged that whilst he was authoritarian, he was also inspirational and idealistic. No such affection appeared to exist towards his brother Raül, who assumed the presidency in February this year and who, as head of the military, seems intent on maintaining tight political control. Whilst Cubans may now legally stay in hotels, the costs prevent this for all but a small minority. Similarly, it is now legal to own a cellphone, but getting a line costs far too expensive for the average worker.

Cubans, especially the young, are desperate for change and feel that whilst they are proud of their country and the achievements of the revolution, this very achievement makes it unnecessary for them to fight the same battle as their parents and grandparents fifty years ago.

This pressure for progress poses a genuine problem for the government. If it relaxes political control too far, or too quickly, the country may fall into the sort of chaos faced by Russia after the collapse of the Soviet Union. At the same time, Cuba is constrained from adopting the Chinese approach of liberalising the economy whilst maintaining strong state controls politically because they have a minute domestic market and no internal capital base.

Intriguingly, the presidents of both Russia and China have visited Cuba in the last month and as both these new political and economic giants are immune to US economic pressure, this may open options for domestic change. Certainly, one observer indicated that the party is planning a major review of economic policy in 2009 in order to provide incentives for farmers and workers in other sectors to increase production and to reduce dependency on tourism as a source of hard currency. Official concern that this may increase social and economic inequality has to be offset by the fact that there is already a massive disparity in incomes between a senior professional earning at most US$40 a month, a primary school teacher receiving US$8 a month and those working in tourism who can earn up to US$250 a month. Such disparities also force many trained professionals to abandon their vocations to take any work where they can earn foreign currency. This is not only a waste of their education, but a source of great personal frustration. One taxi driver told me he was a qualified engineer who could earn far more in a week as a driver than he could as an engineer. He consoled himself that he “was still an engineer in his heart”.

Anyone planning a book on economics in Cuba would do well to use the title “It all depends”, since this is the answer given if you ask the price of anything. It alls depends on whether you work in, or know somebody working in the sector, you have something to swap, or are paying in local, or foreign currency. The failure of the formal economy has forced large sections of the population into an illegal black or informal economy which in turn enables the authorities to selectively punish those it deems a threat.

A pessimistic assessment of the future would be for the military, which already enjoys considerable influence and economic benefits, to increase its hold over both political and economic spheres to the detriment of both economic and social progress. An optimistic assessment for the country’s talented and creative population would involve a relaxation of the US embargo once Obama is in power, followed by a steady increase in external investment managed by an increasingly pragmatic and self-confident government. This would facilitate a range of joint ventures with foreign investors and donors in ways which can build the economy and maintain high standards of public services and welfare, whist accepting a degree of difference in the allocation of benefits (as exists already).

The global economic crisis has destroyed faith in unregulated markets even in the bastions of neo-liberalism. In doing so, it has opened the door to approaches which seek to achieve a balance between social justice and environmentally sustainable economic development. Obama’s election provides hope that the US may place a higher priority on meeting social policy objectives which can reduce inequality. Similarly, there are signs in Cuba that Raül Castro will relax central government controls and promote economic growth and investment, possibly with Russian or Chinese help.

As Cuba prepares to celebrate the fiftieth anniversary of the revolution in the beginning of 2009, a gesture from the US to progressively relax the embargo could help build confidence that change is possible for both countries.

All friends together!

2008-12-18T02:28:00.001-08:00

With the giveaway name of Bernard Madoff relieving investors of US$50 billion (not a typing error) of their money, the US regulators responsible for overseeing such the financial sector (the Securities and Exchange Commission) have been coming in for some well justified criticism. The SEC Chairman Christopher Cox has even grovelled in public, though only to pass the buck down the ladder to paid employees so that the commissioners, who are politically appointed and therefore ultimately responsible, can try to wash their hands of blame.

Of course, we do things differently in the UK. Don't we? Well, actually, no. It's not only quagmires like Iraq that New Labour has followed the US into. We have also followed their approach of 'light-touch' regulation of the financial sector. A key reason why UK banks got so heavily into trouble following the US sub-prime housing scandal was because the UK regulatory authority, the Financial Services Authority, was funded by - guess who? - the very banks it was mandated to regulate! Its like authorising prisoners to run the prison to ensure nobody escapes. With such a cosy relationship, no wonder things went wrong.

Another fine mess you've landed us in Gordon!

The world comes to town

2008-11-17T00:21:00.000-08:00

Early November was probably not a good time to expect decisions to be made on an urban planning application, housing project proposal or academic thesis. About 7,000 of the world’s leading urban planners, policy makers, academics, NGO staff and researchers took time out to converge on Nanjing, in South-East China, for the fourth World Urban Forum (WUF4),

This bi-annual UN-Habitat event was held in the first year when humanity officially became more urban than rural. The overwhelming majority of urban growth is in developing countries, which could triple their entire urban built-up areas by 2030, from 200,000 to 600,000 sq. km. This 400,000 sq. km. increase would match the world’s combined urban area in 2004. Few urban centres have been planned to absorb these numbers. The result is a growing urbanization of poverty (UN 2008). Such a transformation of human society over such a short period presents an unprecedented challenge to policy makers, professionals and the residents themselves, though you would never realise this from the low level of funding and interest shown by donor agencies.

Whilst international commitment and funding for urban related issues has never been high, it is ironic that even this modest level appears to be reducing when the need has never been greater. For example, the UK’s Department for International Development (DFID) and Sweden’s SIDA no longer have dedicated sections dealing with urban issues and DFID sent just one staff member to join the small UK government team in Nanjing.

Despite a laudable increase in its programme budget from little more than £3 billion in 2002 to about £8 billion in 2010, DFID continues to be subject to annual ‘efficiency’ cuts of 5% in its administrative budget which will further erode its ability to influence key aspects of the international development agenda. This is highly regrettable as DFID was widely regarded until recently as a leading influence on urban development with innovative research, capacity building programmes and practical programmes. Whilst DFID continues to fund some important urban capacity building projects, such as a large scale programme in Bihar and Andra Pradesh, India, this is the result of in-country agreements and means that the London HQ has virtually no influence in international development policy for urban issues. Iain Wright, Junior Minister for Communities and Local Government, flew the flag for the UK in Nanjing. Apparently he was extremely impressed by the experience, so perhaps he can have a private word with his ministerial colleagues in DFID to encourage them to re-engage with the urban agenda globally, especially since urban issues are central to addressing climate change and poverty reduction targets.

The British planning profession was well represented in Nanjing, reflecting an encouraging awareness of global issues. Together with the Commonwealth Association of Planners, the RTPI launched a ‘Self Diagnostic Tool earlier this year to help planning organisations across the world to assess their capacity to respond to the challenges of urban growth. Sadly, the RIBA was not present to reflect similar concerns on behalf of the architectural profession.

The event itself addressed the issue of harmonious urbanization, an appropriately Confucian concept given that China was the host. The UN report on the state of the world’s cities, launched just before WUF4 (reviewed in Planning 31 October) also stressed the need for harmony, given the high levels of inequality present in affluent countries as well as the developing world.

As usual in these major events, there was a rich diet of roundtables, networking events, seminars, training sessions, a World Youth Forum and a major exhibition presenting examples of proposals and achievements in China and the rest of the world. With such a wide range of events covering many major issues, it was easy to overdose – and to miss many that were of interest.

Although there was a tendency for presenters to be addressing the converted, it was encouraging to see a large number of mayors, national politicians and private sector representatives participating with the urban specialists. Such diversity of interaction is vital if progress is to be achieved in the real world when participants return home to the everyday challenges facing urban areas. With 1 in 3 of the world’s urban population presently living in slums and squatter settlements and forecasts that this will increase to 1.4 billion by 2020 and 2 billion by 2030 unless radical action is taken, there are certainly no grounds for complacency.

UN-Habitat now needs to stimulate awareness and support for addressing this and other key issues, such as climate change, a topic surprisingly under-represented at the forum, given that urban areas produce a high proportion of greenhouse gas emissions. This goal will not be achieved by holding large conferences or publishing lots of reports, but by informing and persuading those in positions of influence in the donor community.

The global economic crisis:

2008-11-11T04:21:00.000-08:00

The global economic crisis: An historic opportunity for transformation
November 6th, 2008 ·

A message with the above title has been received from Ken Fernandes of stopevictions@yahoo.co.au and represents “An initial response from individuals, social movements and non-governmental organisations in support of a transitional programme for radical economic transformation Beijing, 15 October 2008”. Geoff has posted the following response:

I agree fully that this is an important opportunity to consider alternatives to the neo-liberal, market-driven basis for managing the world economy.

Whilst agreeing with the concerns of those drafting the proposals, I share the reservations of Felipe Aramburu and others regarding several specific proposals.

Essentially, it seems the group are proposing to revert to a socially based development model in which governments would effectively make key decisions on investments and the allocation of resources. In my assessment, this is not only naive but an attempt to turn the clock back to another failed arrangement.

The really exciting point about the present situation is that it is evident that the old certainties of governments knowing best and markets knowing best are dead. Even if banks want to go back to the status quo ante, the environmental constraints will sooner rather than later impose limits on unrestrained growth.

I cannot help hoping that humanity will take this opportunity to reassess the basis for a good quality of life in ways which are not dependent on growth but more on equity within a sustainable environment. There is after all, enough to go around, but its badly distributed.

Change will entail a move away from national governments deciding things and to a degree also a move from private entities controlling the economy towards one in which supra-national entities have a greater role in managing markets so they are less volatile, and more socially and environmentally responsive. This will make the World Bank and other UN agencies, plus the EU, etc, more, not less, necessary. They may be flawed but they are all we have.

I submit that what we need is more 'smart' regulation, not petty bureaucratic rules, but market guidance based on a redefinition of what constitutes the wider public interest and means of protecting and enhancing it.

In her 2008 Schumacher Lecture, Susan George provides a very comprehensive analysis and set of proposals which echo the concerns of your group and which I would recommend progressive thinkers support.

We all want the same ends; the question is one of means.

If you want to read the original message and add your name and/or organization, or leave a comment, you can check the proposals at the following website:http://casinocrash.org/?p=235

Living ground-hog day - again!

2008-10-23T00:37:00.000-07:00

Those of us working on urban development, especially in developing countries seem to have failed so far to convince policy makers in government and in many international agencies, of the need to invest more time and effort in planning for urban growth. Why?

Why is it that any discussion on urbanisation over the last 3 decades or more invariably elicits the response that cites are too big and are growing too fast, as though there is some optimum size or rate of growth, beyond which it should be stopped? Why is the concept of 'over-urbanisation' still so widely held, despite that fact that the proportion of urban populations is actually still relatively low in many countries? Why do so many people still argue that more effort should be put into promoting rural development, by providing jobs, schools and other attractions to help keep people in rural areas?

More to the point, why is it that these responses invariably come from people who themselves live in cities? Why do they want to stop others joining them? If cities are so bad, why do these people not go back to villages themselves? Of course, in high-income countries, many people are doing this. They can afford to commute to the cities when they want or need to and can afford a good lifestyle in a village, often funded, however, by selling a high value urban propoerty and buying up lower price homes in the country. That is their choice (though it also makes life tough for villagers unable to afford a place themselves as prices rise, but that's another story!). However, for those living in developing countries, the cities are where the opportunities are, where the services are, the schools, the cinemas, the clubs and restaurants, in fact all the things middle and high income people around the world take for granted. So why do they want to close the door, or pull up the drawbridge? Why do arguments in favour of planning for urban growth get a negative response year after year and country after country, despite all the evidence that growth will continue whatever governments or international agencies, or middle/high income groups do or say? Why do I feel I have been living ground-hog day for over 30 years?

The cynical view is that people enjoying urban life don't want it spoilt by waves of poor people flooding into their neighbourhoods, lowering 'the tone' and the values of their homes. The more benign view is that people want the benefits of urban life to be more widely distributed so people are not forced to move in order to gain the basic necesities of life, let alone a few modest pleasures.

Whatever the reason, arguments in favour of rural development ignore a few basic issues.

Firstly, in a poor country, investment focuses on the few locations where the economies of scale, the educated workforce, the services and the markets are concentrated. It is only larter, when opportunities are greater, that a more diffused distribution of assets and benefits can be generated. Many developing countries have not yet reached that point.

Secondly, where can the resources for rural development come from? The answer, of course, is from cities! For example, Mumbai accommodates about 1.5% of India's population, but contributes a massive 30% of all central government revenues! So if the Indian government wants the resources for developing the rural areas, it needs successful, dynamic, healthy cities.

Thirdly, the forces generating urbanisation are so strong that it will happen irrespective of whether governments encourage or discourage it. Of course, the outcomes in many developing countries at present pose unprecedented challenges, with a billion people forced to live in slums and squatter settlements, lacking tenure security and basic services. However, life expectancy is still greater in the slums of many developing countries than it was in the mid 19th century in Manchester at a time when the UK was a leading economic power and the numbers of people involved were relatively small. Even then, it took the UK well over a century to come to terms with urbanisation and manage urban areas. Developing countries, lack the economic power the UK enjoyed, often have far larger populations and have had much less time to generate appropriate responses.

That is why we need to find ways of managing urbanisation and urban growth. Before we can even start, however, that is why those of us working on urban development in developing countries need to find ways of increasing acceptance of the realities of urbanisation and urban growth and generating the necessary support to make sure the processes are managed well - and for the benefit of all.

UN-Habitat has a major role to play in this and has so far not succeeded in winning the argument. Campaigning for better governance, for tenure security, for harmonious cities, etc., is all very well, but until it can help win the argument about the positive role of cities in social and economic development and show how this can be achieved in environmentally sustainable ways, we will not make any real headway.

UN-Habitat launches harmonious cities report

2008-10-22T07:33:00.000-07:00

On a day when the UK press reported that a 16 year old was chased down a street, beaten and stabbed to death, simply because he was “from another part of town”, the UK launch of a report promoting harmonious cities (‘State of the world’s cities 2008/2009' UN-Habitat) could not be more timely.

Launching the report in London, Anna Tibaijuka, UN-Habitat’s Executive-Director, said that whilst there are massive problems of deprivation and inequality, these are by no means restricted to developing countries. As the housing loans crisis in the USA has demonstrated, it is now clear that issues of housing finance are global and that the poor have been left to cope on their own for too long. Sustainable urbanisation needs to provide pro-poor, inclusive approaches to urban management and development.

Summarising key findings from the report, Eduardo Moreno presented a range of data on l social, spatial, and environmental aspects. Much play was made at the launch on data relating to income inequality, though as David Satterthwaite, one of the launch panel stated, we need to consider inequality and deprivation within a broader framework to include aspects such as access to public services, health and educational facilities.

Despite their higher incomes levels, the report demonstrates that cities in the USA are as unequal socially as many in Latin America and sub-Saharan Africa, which contain the highest level of social inequality in the world. Whilst European cities are relatively equal in social terms, it is impossible to deny that we have a long way to go before we can claim to have created harmonious cities.

In campaigning on behalf of cities, UN-Habitat faces a dilemma. If it celebrates cities and urban life, it can be accused of being in denial of the manifest problems faced by 1 billion people – 1 in 3 of the world’s urban residents - living in slums, many without basic tenure security, clean water or sanitation. On the other hand, if it focuses too much on the scale and complexity of the problems, donors and national governments may just bury their heads in the sand and hope that rural development programmes will curb urban growth. Of course, this overlooks the fact that although 3 million people are being added to urban populations globally every week, rural-urban migration is not the main cause of growth in many cities and has been replaced by increases within existing urban populations. Whilst urban issues are undeniably complex, they can be addressed by bringing the residents into the decision-making process and improving governance at national and local levels.

Another challenge addressed by the report is that of climate change. Nearly 400 million people are considered to be at risk, mostly in developing countries like Bangladesh which are vulnerable to sea level rise.

Cities are also major consumers of energy, with buildings representing a higher proportion than industry or transport in high-income countries and cooking one of the major consumers of energy in low-income countries. Whilst cities are justifiably blamed for contributing to CO2 emissions, the report demonstrates that this is related more to consumption patterns than urbanization per se. For example, Sao Paulo produces one tenth of the emissions of San Diego, with a population ten times bigger. Cities in Europe are making progress in clean energy, whilst those in the USA continue to be the worst polluters, due largely to urban sprawl and private motorised transport.

Improved building design, more efficient land use and friendly, efficient public transport offer the greatest scope for improvements. Clearly, if cities are currently part of the problem, the report makes it clear that they have to be part of the solution.

My hands are clean!

2008-10-15T02:39:00.000-07:00

Now that the sub-prime crisis has triggered the end of free market capitalism, many are understandably claiming they saw it coming. However, how many can claim they saw this in 1989, nearly 20 years ago? Let me explain.

In 1989, I was invited by the World Bank to review a large number of reports, articles, books and papers on land tenure policies in developing countries as a potential contribution to the Bank's forthcoming housing policy paper. I explained to the Bank that I was not an economist, had minimal knowledge of the subject, but was, of course happy to be paid to learn more. I was told it was because I had already reviewed the literature on housing policies in developing countries and could summarise complex issues for a non-technically sophisticated readership (they had students in mind), that I was in fact well qualified. Flattery, and the prospect of being paid to learn, was enough for me to accept.

During correspondence and the exchange of a first draft, it became increasingly clear that the Bank wanted my report to endorse a policy of promoting home ownership in developing countries. Other forms of tenure, such as customary or rental tenure, were apparently not of interest.

The more I read, the more these assumptions seemed politically driven rather than empirically based. I could see no reason why home ownership was being so widely promoted. The reason given - that people could use the collateral of their titled homes to obtain credit, set up a business and thereby lift themselves out of poverty, was seductive, but made a rather basic assumption, namely that collateral is only relevant if you can afford to service the debt in the first place. For the majority of low-income households in developing coutnries, this was clearly not possible. Home ownership, in other words, is not appropriate for everyone.

My draft report advocating caution and promoting tenure diversity was condemned internally as biased, though no substantive criticisms were made and I was told that they would permit me to publish elsewhere. My report findings were excluded from the Bank publication, which was published in 1993 under the revealing title of 'Housing: Enabling Markets to Work'. A cynic might claim that this was a clever highjacking of the enabling concept being advocated by UN-Habitat and many progressive housing professionals working in developing countries, but that's another story.

It was this experience that got me into working on land tenure issues. Several research projects later, the initial concerns have now been fully vindicated. The assumptions made by the Bank - and many other advocates of free markets - have been exposed for what they were - an ideologically driven agenda.

I trust we are all pragmatists now.

Living in interesting times!

2008-10-14T16:25:00.000-07:00

My first blog - and what a time to start!

All the old certainties of the world, that governments had all the answers, and then that markets had all the answers, are gone. Even bankers, those 'masters of the universe' are now civil (or uncivil) servants! Can we assume they will be subject to public sector pay restraint?!

The housing bubble has finally burst - and about time. Surely it is not just bad economics, but also immoral to be able to get richer by lying in bed as one's home rises in value, than if one goes out and gets a job?

If this bubble had not burst now, the pain when it finally burst would have been even bigger. So now we have effectively got a form of socialism. However, its not the old form that strikes terror into the hearts of God-fearing Americans, under which the State decided who needed what and what they would get. This form of socialism is far more interesting and, hopefully, sustainable. The new socialism is in fact a form of social capitalism or tax-payers socialism, since the state is investing taxpayers money - yours and mine - so needs to listen (or at least pretend to) when it places its representatives on the boards of banks and other joint venture companies (which is what banks have become).

We can expect a new generation of 'smart regulation' in which private corporations will need to take into account the wider public interest when making their investments.

The time has arrived in which we need to redefine the public interest in economic development (and urban development) and formulate ways of protecting it, whilst still enabling bankers and other investors, to make a reasonable living.

Interesting times indeed - and potentially exciting! This time, we need to get it right.