Capital City: An Interview with Sam Stein

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In Capital City: Gentrification and the Real Estate State, Sam Stein offers a theoretical and empirically grounded discussion of how gentrification became a generalized fact of urban life in the 21st century, and how we can not only stop it, but also build cities that work for all, not just the wealthy few. Centering his discussion around the contradictory and often hidden role of professional planners, Stein illustrates how the state has been central to the rise of real estate in urban political economies, leveraging state “police powers” to turn devalued urban land into a profitable commodity — the so called “spatial fix” that capital requires from time to time in moments of crisis. By bringing to life the diverse set of state and non-state actors responsible for turning the places we cherish into products to be bought and sold, Stein also reveals the contingencies and limits of real estate capital’s power over our lives.

Counter to the neoliberal tautology that gentrification is inevitable — a claim that justifies all manner of violence against vulnerable urban communities — Stein argues that there indeed is an alternative to land value planning and capitalist land markets. Shining through Stein’s history of imperialist expansion, mass displacements and enclosure, and bipartisan commitment to prioritizing real estate profits over people are stories of tenants, workers, and radical planners who successfully fought back against the commodification of urban space. Hilary Wilson — PhD student in Geography at the CUNY Graduate Center — recently interviewed Stein to learn more about his motivations for writing the book and the social, political, and economic struggles that have constituted the real estate state.

What motivated you to write this book? Why did you want to write about urban planners in particular?

I wrote about urban planners because, in a sense, I am one. I was trained and educated at Hunter College as an urban planner, and so I am both sympathetic to the project of planning while being critical of the way it is done from something of an insider’s perspective. The phenomenon that motivated me to take on this project was the relationship between urban planning and land values in places (like New York) where land is largely privately owned, and where massive amounts of money are invested into real estate. In such places, positive urban planning interventions will raise land values, which result in higher property values and higher rents. There is therefore a close connection between “good urban planning” and gentrification. I felt this needed to be explored more closely in order to think about how we could work to undue that linkage.

At first, I wanted to write about plannING, not plannERS. The folks at Jacobin and Verso who commissioned and acquired this book, though, encouraged me to talk about the people who do this work, and not just the work they do in general. I think that was a great suggestion, as it helps the readers see that these are not just abstract forces, but decisions made by real people in real places and in real time.

As you discuss in the book, what is considered "good urban planning" has evolved over time, as has the role of urbanization in the reproduction of a racial capitalism. Can you talk about this historical relationship between planners and capitalist modes of urbanization?

The act of planning has always been a part of human society, but the profession of planning is a relatively newer phenomenon, usually traced back to the late 19th and early 20th centuries. Planning tended to fall into either radical or reformist camps, with planners seeking either to aid movements thought sought to develop spatial alternatives to capitalist urbanization or to help the capitalist state evolve and survive into the future.

Capitalists have a complicated relationship with planners. As a class, capitalists tend to publicly deny the need for planning, and insist instead that markets are the most efficient and even equitable way of making decisions about the allocation and production of space. In private, however, they know that there is little they can do without state intervention, either in the form of large-scale fixed capital infrastructure investments, or in the work of ensuring the social reproduction of their workforce. Things start to get interesting, though, when different kinds of capitalists demand different kinds of interventions from planners. In many ways the planners’ job is to mediate between the contradictory needs of conflicting arms of capital, while maintaining legitimacy in the eyes the populace. One of the main arguments of my book, though, is that real estate capital has overshadowed other competing types of capitalists, and so their demands are incredibly salient to urban planners.

You also argue that the demands of real estate have perhaps become more salient alongside broader political economic changes, particularly since the early 1970s. How have financialization and the spatial reorganization of production in the U.S. changed how planning happens in capitalist cities?

What we call de-industrialization (somewhat erroneously, because the world is more industrialized than ever—Stanley Aronowitz told me we should call it de-factoryization) had a tremendous impact on cities. Major industrial production continues to occur in the US, but in many places, industrial production has exited (by choice and by force) from central city locations. Firms have relocated to the suburbs and exurbs, or they decamped from the country altogether. This leaves a tremendous vacuum. There is an economic vacuum, as workers are left insecure and unemployed; there is a spatial vacuum, as the physical shells of factories are abandoned by the firms that formerly occupied them; and there is a political vacuum, as one of the most influential sectors of capital departs for other pastures. One way of understanding the gentrification we now see in many cities — including, of course, New York — is that real estate capital filled those vacuums: it reinvested in old manufacturing districts; it reshaped the local urban economy; and it took control of the political narrative and the urban planning apparatus. Real estate capital always had a loud voice in planning decisions, but today its power has risen to obscene heights, with nearly every planning program including real estate growth as a key element and arbiter of success. In New York City, we’ve gotten to the point where under both the conservative Bloomberg administration and the liberal de Blasio administration, whatever the planning problem, the solution must include luxury development.

Can you say more about how capital benefits from cities' collective resources? The term "value capture" has become a popular buzzword among planners, but you give many examples of how capital actually captures value from the public.

Land on its own has little exchange value under capitalism. A lot of the reasons that one parcel is considered valuable while another is considered worthless (in exchange value terms) comes from the social investments put into different places. Some of that has to do with the relational aspect of property — in other words, some land is valuable because it’s close to something else of economic value. A lot of it has to do with the infrastructures that cities create and maintain (transit systems and streets; water systems; electrical grids; etc.) and the public spaces (parks, sidewalks, beaches) that cities create to make spaces more livable. In a system of private land ownership, however, whoever owns the land accrues the value these public investments generate.

Some planners have tried to alter this dynamic through planning interventions they refer to as “value capture.” In this model, the city takes back some of the value it creates by demanding that land owners give something back to the public, often in the form of affordable housing, parks, or transit investments. If cities were demanding that land owners pay the people back for the value they have enabled, that would be something like the kind of radical Land Value Tax that the economic Henry George (NYC mayoral candidate, 1886) proposed. Instead, however, the current fashion is to create new value for landowners, and claw back a small portion of that publicly-generated benefit. For example, de Blasio’s Mandatory Inclusionary Housing program creates enormous amounts of value for land owners by upzoning (or changing the land use laws to allow more intensive development) working class, majority people of color neighborhoods, then “recaptures” some of that value by insisting that a portion of the new residential development be affordable. We can argue about the quantity of affordable housing being created, as well as the level of affordability these new units meet, but what we must be clear on is that the program is a tremendous net gain for land owners, speculators and developers. This is a far cry from a Georgist program of value capture. It’s really more of a boondoggle in Georgist trappings.

One family that has benefited immensely from state planning resources at all levels are the Trumps. Can you talk a bit about how your case study of three generations of Trumps—Friedrich, Fred, and Donald—elaborates your argument about planning’s role in a specifically racial capitalist urbanism?

When we talk about planning history, we usually talk about the various paradigm shifts in the way state planners have operated. I wanted to show the private side of planning history: the landowners, speculators and developers who have benefited from the various modes of urban planning. The Trumps provide a perfect vehicle for this, not because they are exceptional but because they are exemplary. (Ok, they’re kind of exceptional in that one of them is now president, but that only furthers my point about real estate’s rule in the 21st century!)

Friedrich Trump is a classic example of a speculator who profited off of proto-planning: first in the Pacific Northwest, benefiting from an early mode of what planning theorist Ananya Roy characterizes as “governing through informality” as well as a complex land-for-infrastructure scheme between the federal government and the railroads, all in the pursuit of westward expansion and indigenous dispossession; then in Queens, where he bought cheap land that he knew would soon become valuable when the city built the Queensborough Bridge and the Pennsylvania Railroad extended the subway. His son, Fred Trump, was exactly the kind of builder that “rational-comprehensive” planners sought to deal with: a partner who could make real the dream of building up segregated housing in Brooklyn and Queens through differential FHA loans, wartime subsidies and urban renewal. Donald Trump was the prototypical neoliberal developer, exploiting developer tax subsidies, rezonings, deindustrialization and privatization to gentrify Manhattan and secure his own personal profit. Later he also played a small role in the sub-prime mortgage crisis. As the racial capitalist state’s planning apparatus evolved through the late 19th and 20th century, the Trumps were right there, making money off of every move.

One theme running throughout the book is the importance and even necessity of urban social movements in challenging the real estate state. Ultimately, you argue that that the decommodification of land will be necessary for poor and working urban residents to fully enjoy the fruits of their collective labor. Can you talk about the vision you lay out for accomplishing this?

There’s a lot that could be done to challenge real estate rule that is within the capitalist mode of production and the republican mode of government in which US cities are situated today. I spend a lot of time laying out those policy options not because I think their implementation is particularly probable, but to show the lie in the claim that nothing can be done right now to stop gentrification.

To really cut the chord between urban planning and gentrification, however, we need to envision a city that rejects private land ownership as its basis. I put forth three key principles, which came not only from my own imagination but from anonymous interviews with radicals inside New York City planning departments and from my experiences in the New York City anti-gentrification movements. Those principles are: public stewardship; socialized land; and a reordered regionalism. Public stewardship means a planning system in which workers and residents, not just developers and owners, control the means of spatial production. Socialized land means changing the social relations between humans and the earth such that land itself cannot be treated as a tradable commodity.

Reordered regionalism means abandoning the arbitrary political boundaries that confine political action to narrow jurisdictions, and instead focusing on the ecological and social relations that bound people and places together. It’s all a little vague, but honestly the precepts of capitalist urban planning are too. (What, exactly, constitutes “highest and best use,” really?) We can think more about how we get there — and I have plenty of ideas about that, too — but I think it’s important to envision a radically different mode of urban planning and urban life if we ever want to get out of the traps and contradictions engendered by the rise of the real estate state.