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Saskia Sassen, Global Cities and Financial Crisis

April 20, 2009 by and tagged , , , , , , , , , , , ,

SofG Saskia Sassen gave an  interview to Le Monde at the occasion of the translation of A Sociology of Globalization in French (Denis, Pierre, Fred et Ben, Dave, Jay, Mark, how about we all read it and have ourselves a little online cross-blogs symposium on it? Could be fun, no?). Full profile here.

Saskia Sassen is, of course, a famous sociologist who coined the phrase "global city" to indicate the confluence and convergence of global processes enmeshed in national and local dynamics in the urban centers of the world, global North and South alike to create centers of economic and financial power.

She is a scheduled speaker at the World Investment Conference, whose topic is "investing in global cities."

According to Sassen, the destabilization of non-urban economies in the global South is going to accelerate the massive urbanization already taking place. At the same time, tent cities are also cropping up in the United States. Urban poverty is on the rise and it is affecting the middle classes and not just the usual poor and homeless. Large cities in the global North have seen their revenues plummet and therefore have cut back on services.

Global cities are an integral infrastructure of the global financial systems. It is at their heart that these new and risky financial "products" were designed. They are also the prime target for the crisis. The urban embedding of global cities with global financial flows also makes them vulnerable. Indeed, London and New York City, for instance, are being dramatically affected.

Financial flows targeted the cities themselves as investment objects, with the same short-term focus and high ROI. Look at Dubai with its massive luxury real estate developments not based on housing needs but on pure speculation (capital in search of profitable investments). Similarly, the sub-prime loans were based on the same logic. The financial world created extremely complicated instruments to extract wealth from modest households with high ROI. For Sassen, these mechanisms are destructive for the cities as housing units are now abandoned by the millions.

The globalization of cities has also produced similar structures in world cities: same business districts, same commercial centers and shopping malls, same luxury chain hotels, same airports with nice international terminals, all for the transnational capitalist class. For Sassen, this urban environment is dedicated to dominant economies but at the same time, cities compete through economic specialization.

So, what kind of stimulus do cities need? For Sassen, sustainable development is key to create jobs, private / public partnerships. Businesses badly need cities, their infrastructures and networks. This places cities in a favorable position to negotiate with the private sector.

Posted in Development, Economy, Global Cities, Global Sociology, Globalization, Networks, Poverty, Risk Society, Social Theory, Sociology, Transnational Capitalist Class, Urban Ecology | 1 Comment »



One Response to “Saskia Sassen, Global Cities and Financial Crisis”

  1.   Une heure de peine Says:

    “how about we all read it and have ourselves a little online cross-blogs symposium on it? Could be fun, no?”

    Yeah, it could be fun. It’s my next book to read.

    Reply

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