Looking back through a Facebook page I saw with great regret that Professor Doreen Massey had died in 2016. After hearing her speak on Radio 4, I read her book, World City, Polity, 2007, and we corresponded by email several times. I think this photograph shows her warm and lively personality.
Yesterday, following input about ‘shrinking cities’ on WMNEG’s website, and as a belated tribute, some points made in that book will now be shared, selected from five pages of notes made at the time. Several references are relevant to the Grenfell Tower disaster.
In the world as a whole big cities are increasingly dominant and central to globalisation: the shining spectacular projects and the juxtaposition of greed and need reflect their market dynamics.
The World Bank, one of the institutions whose policies have contributed to this massive flow of people into cities, has argued that it is through competitive cities that nations as a whole can develop.
Global cities are defined by their elite – the rest are invisible.
London is a political, institutional, economic and cultural power. Its influences and its effects spread nationally and globally but it increasingly overshadows everywhere else. National government policy accepts and also feeds its voracious growth.
Forces in the financial City took the lead in advocating and developing the deregulation that lies at the heart of globalisation; it is a command centre, place of orchestration, and significant beneficiary of its continuing operation.
Despite talk of `national sovereignty’, the first thing Margaret Thatcher did on coming to power in 1979 was to lift restrictions on foreign currency exchange, to be followed in the mid-1980s by the deregulation of the City (the so-called Big Bang). A whole gamut of deregulatory and commercialisation policies, in pensions, housing, health care and education considerably increased the market for City activities.
Thatcherite policies benefited the private sector, financial services, the middle classes, London and the South East at the expense of the public sector, manufacturing, the old industrial regions and the working classes.
The colonisation by private capital of industries and services formerly provided by government – the utilities under Thatcher and Major, significant parts of the welfare state, especially health and education, under Blair – led to London’s reinvention and resurgence.
Policies of competitive individualism and individual self-reliance have been promoted – people have been encouraged/required to take much greater financial responsibility for their own housing, pensions, health care and education. Previous notions of mutuality have been abandoned and the idea of the public good has been systematically undermined.
The world’s biggest international financial centre
From the mid-1960s the City took advantage of an offshore status manufactured by British taxation policy . . . and became an offshore extension of New York, creating a major market in eurodollars which now makes it the world’s biggest international financial centre. It has been a lucrative subservience, for some: out of this that the new elite has been born.
The emergence of the new elite includes those involved in business services as well as finance: real estate, renting and business activities. Advertising, research and development, accounting, auditing and taxation, legal services, market research and consultancy, personnel recruitment, renting of machinery and technical consulting, investigation and security have grown rapidly as part of London-global-city.
For the ultra-rich few, this country is now a virtual tax haven and princes, tycoons and oligarchs are making it their home. Others are attracted by the lucrative opportunities in the City – more than one in 10 professional staff in the City of London come from countries outside the EU and the US, including the plunderers of Eastern Europe and the old Soviet Union. A report on French people working in the UK found 69% of them in London and half of those are working in financial services in the City.
The pattern of British chief executives’ pay is now openly modelled on the American lead
Directors paid 113 times more than the average UK worker in 2005 are awarding each other their increments. Over the last five years the average salary of a chief executive in Britain’s leading companies, including bonuses, has more than doubled, just as American remuneration has grown – bearing little relationship to company performance. This has resulted in levels of inequality far higher than in the major economies of continental Europe.
Such high salaries make London the most unequal city, and London and the South-East the most unequal region in the UK.This inequality of the extremes is characteristic of the `Anglo-Saxon’ version of neoliberalism and it is growing.
The exuberant, champagne-swilling claim of the success of London’s reinvention is, however, almost always hedged about with a regretful caveat – `but there is “still” poverty too’. The success and the poverty of London are the combined outcome of politico-economic strategies, establishing a two-tier society, corporate greed and the privatisation of need in the capital and at national level.
Some facts are indisputable. Inequality between rich and poor, the glaring starkness of class difference, is more marked in London than anywhere else in the country
- Unemployment in Inner London is higher than in any other subregion in England, while Outer London hovers around the national average; on almost any index there is an enormous geographical variation between boroughs.
- London has the highest incidence of child poverty, after housing costs have been taken into account, of any region in Great Britain.
- The gender pay gap is wider in London than in Great Britain. London has local authority areas with both the highest and the lowest rates of means-tested benefit receipt in the country.
- Nearly a quarter of London’s children (24 %) are living in households dependent on Income Support’ whilst the rate for Great Britain as whole is 16 %, and London’s rate is the highest of any region.
- Poverty is common among pensioners, too; in Inner London, a quarter of people aged sixty and over are on Income Support – only 15 % in Outer London and in Great Britain.
- Homelessness and overcrowding are higher in London than elsewhere. The difference in life expectancy, is stark even between the boroughs of London.
- On average, women in Kensington and Chelsea live nearly six years longer than women in Newham; and men in Kensington and Chelsea (again) live nearly six years longer than men in Southwark .
People are trapped in poverty because of the high cost of living, and the cost of getting to work Those currently dependent on benefit find that loss of entitlement to benefits, particularly housing benefits can completely erode gains from entering employment. The higher cost of housing, transport and childcare are important factors in explaining the pattern of disadvantage in the city.
Within the UK the old ‘North-South divide’ has widened and has increasingly taken the form of an ever-expanding London versus the rest of the country
The New Labour government & London-centred private capital share an understanding of London/the South-East as the golden goose of the national economy – the `single driver’ of the national economy – which lays golden eggs for everyone.
There is an insistence that encouragement to `the regions’ must in no way be allowed to challenge, question, or in any way restrain the growth in London and the South East of England. Her Majesty’s Treasury, in a joint document with the Department of Trade and Industry, argued that `attempts to address regional differentials must be done by a process of levelling-up, not levelling down … whilst regional economic policy must aim to strengthen the indigenous growth potential of all regions, the focus should be on the weakest regions, without constraining growth in the strongest’ .
London’s growth over recent years and as planned for the future, requires labour with degree-level qualifications. It is demand for this kind of labour that dominates the net increase in employment in the capital. London does not provide all of this and in consequence draws in professional people from abroad and from the rest of the country.
Many workers come from Eastern Europe and the global South. London is dependent, for instance, on nurses from Asia and Africa. These countries can ill-afford to lose such workers, and they have paid for their training. So India, Sri Lanka, Ghana, South Africa are subsidizing the reproduction of London. It is a perverse subsidy, flowing from poor to rich. It is, moreover, a flow that is both fuelled and more difficult to address as a result of the increasing commercialisation/privatisation of health services.
It is a brain drain that has a double effect. In London the dominance of demand for this kind of labour makes it more difficult for Londoners without those qualifications to find work and, through the influx of higher paid workers, increases the pressure on prices and therefore inequality within the capital. From the regions and nations of the North and West it drains a stratum of the population that could be significant to their economic growth.
(Yet) Gordon Brown has told the regions that their regeneration should be led by the knowledge economy and Alan Johnson, when minister for manufacturing, repeated the refrain that low skills are part of the regions’ problems. In other words, the regions are blamed for the losses they incur through feeding London’s demand.
Arguments that London is a ‘successful’ region which must not in any way be challenged rest on a crucial assumption. This is that London has achieved its present position through its own efforts. As the hegemonic terminology has it: to do anything to disturb London’s trajectory would be to buck market forces.
London’s transnational financing and service-providing roles have not, however, been the main driver underlying the city’s growth since the 1980s, nor do these functions represent the major element of London’s export base. London’s main export market is in fact the `rest of the UK’ (RUK) which takes 28.5 % of all London’s exports, compared with 12.33 % going abroad. For financial services, the comparable percentages are RUK 39.88 % and international 31.46 % and, for business services, RUK 32.89 % and international 12.08 %.
This data contradicts the notion that London, in economic terms, is floating free from the rest of the UK economy into an international arena of its own. It directly contradicts the conclusion that in a globalised economy London does not need the markets of northern Britain. As a London School of Economics study puts it, `the London economy is still closely integrated with the overall UK economy’.
Despite the facts, however . . . there is also some resentment: an argument that London has been subsidising the rest of the country and can afford to do so to the same extent, voiced in a report for the London Chamber of Commerce and Industry (LCCI) entitled The London deficit – a business perspective provides an example:
The London economy is the largest and most successful regional economy in the UK. It has often been suggested that its success has been to the detriment of other UK regions, drawing highly skilled people away from other areas. The reality is more complex. As will be seen from this report, the UK’s progressive taxation structure ensures that London contributes a greater proportion of total income raised from taxation in the UK than any other region. In short, London subsidises the rest of the UK, enabling the nation as a whole to benefit from the capital’s success.
The figures for London, however, usually include expenditure on the bulk of the national Civil Service. But this service operates over the country as a whole and should not appear on London’s balance sheet. The presence of so many Civil Service jobs and functions within London also contributes significantly to London’s economic growth and helps to influence the drawing up of national economic policy.
From Doreen Massey’s conclusion: “In the United Kingdom, London increasingly overshadows everywhere else and government policy has been to acquiesce in and feed its voracious growth. Is this what we want? The question is rarely heard in democratic debate”.
This book followed her pamphlet advocating Decentering the Nation: a radical approach to regional inequality, written with Ash Amin and Nigel Thrift, Catalyst 2003, on which notes also were made.