Is growing the city always good?


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  • Sunday, 13 Sep 2020

Expanding city: As its population grows, Kuala Lumpur is seeing affordable houses in the suburbs pushed further out of its centre.

Cities need a healthy level of density to create enough diversity and economic value to achieve a vibrant life. But size does matter when it comes to urban growth.

CITY growth tends to be equated with progress. This belief is very much tied to the idea that growth is always good for cities. In fact, the objective of urbanisation has always been governed by the idea to encourage growth, for its own sake.

This idea is so widely accepted, that it is one of the very rare issues that elites, with their conflicting interests, are able to find common ground. When it comes to promoting growth, in terms of population, size and rate, not only are they able to be united, they are even able to create consensus among city officials, urban thinkers and reformers.The advocacy of growth, of course, does not come without strong rhetoric. Proponents of growth assert that it strengthens the local tax base (more taxpayers giving more money to the government which will in turn benefit the masses), provides resources and knowledge needed to tackle social problems, meets housing needs and allows the market to serve public tastes in commercial development. It brings in the human capital a city needs to become vibrant and economically viable.

But are these claims always true? Is growing the city always good?

In order to understand the forces behind the push for growth, it is important to look into the actors that participate in the growth machine.

Among the main actors in this machinery are politicians. From local councillors to mayors and ministers, growth is always an issue that politicians champion, either in their election campaigns or during parliament sessions. Their strategies of promoting growth might vary – either following the “free economy” model of unbridled exploitation of the labour force, or through overt government interventions focusing on long-term growth – but they sing in unison in campaigning for more people to come to their cities.

In the past, many politicians were also engaged in the buying and selling of land, which allowed them to directly benefit from growth. Nowadays, with stricter laws and regulations, it is more difficult for them to continue that practice. However, politicians are mainly backed economically by elites and companies, mostly by those who support the growth objective and benefit from it themselves, such as real estate entrepreneurs and big businesses.

Hence the policies politicians support almost always carry with them the idea of growth. Even if they have no intention in enriching themselves, they still promote growth with the idea of benefiting the “whole community”.

Another important actor is the local media (as in media vehicles such as newspapers and radio stations that serve the communication needs of the communities or metropolitan areas where they are located).

For them, the logic is straightforward – growth equates to a larger consumer base. Local media profit from the increase of circulation and therefore have a direct interest in city growth. Even in the era of digital circulation across borders, only big media conglomerates enjoy penetration into markets beyond their physical borders. Most local media still experience barriers to enter other cities’ markets, which compels them to prefer population growth in their own cities to increase readership.

This interest in growth, in turn, creates skewed coverage on the impact of growth. As a result, media coverage tends to be about congratulating growth rather than calculating its consequences, and complimenting development rather than criticising its impact.

The media has a tendency to present a favourable image of the city to outsiders, and only sparingly use their issue-raising capacities so that people living outside of their city would still be attracted to move in and contribute to the growth machinery.

However, unlike politicians and other businesses, local media has no interest in the specific pattern of that growth. Their only interest is the increase of readership, without needing to care much about who those readers are and at which part of the city they are residing. This gives them a somewhat neutral position when discussing growth, both to their readers and to other parties of the growth apparatus. Local media are able to criticise certain policies or plans with regards to their impact on growth and these stances are usually reformist in nature, invoking the common good, but they never question the impact of growth itself.

Another notable mention of actors in this machinery, besides landowners and rentiers of course, are utility providers. Similar to local media, utility providers rely on a larger consumer base to gain profit. Never shying away from extending services to areas that are costly to service, they are often determined to acquire more customers to pay off past investments and also to prove they have the good growth prospects that lenders use as a criterion for financing additional investments.

Looking at the actors that partake in the growth machine explains the driving forces behind the push for growth. It shows that instead of being driven by rational thought for the good of society, these actors are in fact driven by personal interests that are rooted in their economic and political advancement.

The next question to ask is, what are the harmful impacts of growth to cities? It seems that there is a relation between growth and inequality. As the number of inhabitants of a city increases, the number of bidders for the same critically located land parcels also increases, which in turn inflates land prices relative to wages, as well as other wealth sources. This increase in property prices forces people in lower income groups to seek accommodation in the low-income market. But as more people bid on the already scarce affordable spaces, rent will rise even more, and low-income tenants can only respond by subdividing spaces with inevitable consequences – overcrowding and slum formation.

Many cities around the world experience this problem, from Rio de Janeiro and Paris to Mumbai and Jakarta. However, it is important to note here that a high population itself is not the cause for overcrowding and slum formation.

As Jane Jacobs has elaborated in her ground-breaking work The Death and Life of Great American Cities, high density (meaning a high number of inhabitants) should not be confused with overcrowding, as many overcrowded slums have a low density level.

But in the free market economy that most cities operate in today, property owners are able to reduce supply when the demands are high, creating a situation where a small part of the population enjoys more space, while the majority has to share whatever small amount of space they can afford.

If the situation does not create overcrowded slums, it creates gentrification. As more high-income tenants bid for spaces closer to the centre of the city, low-income tenants seeking affordable accommodations are pushed further out to the fringes of the city, and sometimes outside of it.

Take Greater Kuala Lumpur, for example. As its population grows and the city expands, affordable houses in the suburbs are being pushed further out, as far as 70km from the city centre. Indeed, growth mainly hurts those in its direct path whose primary tie to place is its residential use value.

In addition to that, growth also affects the city’s fiscal health. In servicing the high number of residents, cities are obliged to provide sufficient infrastructure. Using the example of housing, in order for a city to tackle the issue of affordable housing for its inhabitants, the city has to build adequate public housing. However, as inflation accelerates and construction costs increase, the price to build and maintain public housing takes a toll on the city’s coffers.

There is also the problem of failed growth. In pushing for growth, cities also often anticipate and prepare for it through further development of infrastructure, providing special tax incentives or other subsidies to attract new industries and providing employment for potential newcomers.

However, there is no guarantee that the newcomers, either employers or the labour force, will come. When growth does not materialise as expected, the result is bitter disillusionment. The costs of overbuilt infrastructure begins to drain the public budget and slowly it erodes fiscal integrity as the service costs of maintaining such infrastructure outweigh the revenue they generate. One only has to look at Cyberjaya to see an example of this, among other failed developments in our country.

Clearly, there are negative impacts from uncontrolled city growth, especially when it does not come with proper planning and the development of other policies to deal with these potential issues.

There is also clear hypocrisy among the proponents of the growth machinery when it comes to the kind of people they want to have in their cities. The current refugee crisis proves that not everyone is welcome to enter any city. Some cities want to maintain their cultural identity, thus only allow certain groups of people to enter so as not to disrupt or change their ethnic composition. But that is a different issue that deserves a longer discussion.

So does this mean that cities should stop growing, or worse, reverse their growth? Certainly not. That would lead to the shrinking of cities, which is a different problem altogether. Cities need a healthy level of density that would separate them from rural areas and small towns in order to create enough diversity and economic value to achieve a vibrant city life.

However, it is important to acknowledge that the assumption that growth is always good is false. Growth should not be pursued for growth’s sake. In most cases, in pursuit of growth – in terms of population, size and rate – the use value of a majority is sacrificed for the exchange gains of the few. In the end, it is about counting the cost of the actual price to be paid and the ability of the city, and its inhabitants, to pay for it.

Badrul Hisham Ismail is the Director of Programs at IMAN Research. The views expressed here are solely the writer’s own.

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