The new urban managerialism in geopolitical context

Introduction

In a highly influential paper, Harvey (1989) argued that, in the wake of the crisis of Keynesianism, the dominant political rationale for urban development underwent a decisive shift in the 1970s and 1980s from managerialism to entrepreneurialism. Driven by the necessity to accumulate, urban elites in many Western countries were engaged in an intense inter-locality competition to attract investment and, in the case of urban governments, accrue tax revenues. If there was a strong sense of social necessity in Harvey’s explanation for the rise of urban entrepreneurialism, he nonetheless recognized that cities pursued different entrepreneurial strategies by exploiting place-specific attributes (e.g. the presence of a specialized labour force, local agglomeration economies, etc.). Typical strategies might include efforts to attract corporate headquarters or bidding for major cultural events and large-scale state-funded projects, such as infrastructure or research facilities.

Municipal entrepreneurialism was already a well-established feature of urban development in North America and, if to a lesser extent, parts of Western Europe too. Indeed, in the United States, municipal entrepreneurialism has operated in one form or another since the early 19th century (Sbragia, 1996). Despite prompting questions about its empirical generality, Harvey’s analysis nevertheless inspired other urban scholars to situate interurban competition in relation to the socio-spatial structures and regulatory tensions surrounding processes of capital accumulation. In so doing, scholars also drew their inspiration from critical realism (Sayer, 1992), rejecting empirical generalization as a form of explanation and turning to the analysis of wider socio-regulatory structures, causal mechanisms and their place-specific contingent conditions of activation (Cox, 1993; Hall and Hubbard, 1998; Jonas and Wilson, 1999; Lauria, 1997).

Phelps and Miao’s (2020) article extends this genre of critical urban analysis and considers not only how modes of urban governance today differ from earlier managerialist forms but also from those entrepreneurial modes originally described by Harvey. Notably, they identify four variations within urban entrepreneurialism: new urban managerialism (hereafter NUM); urban diplomacy; urban intrapreneurialism; and urban speculation. These are ‘overlapping yet qualitatively different forms of innovation in which local governments are engaged’ (Phelps and Miao, 2020). They further suggest that in his original thesis Harvey underplayed the role of the state in the politics of urban development. Not only has there been substantial innovation from within the public sector but there are also visible continuities in state structures, incentives and practices shaping urban governance processes and structures in the present.

Today’s urban politicians and managers are highly adept at networking and interacting across local and national political borders; indeed, they are often regarded to be more entrepreneurial and strategic in responding to global issues and challenges than their counterparts in national government (Barber, 2013). Phelps and Miao highlight urban diplomacy as evidence of innovation and continuity in the NUM. However, they do not press home their argument by situating the NUM in a wider geopolitical context. If cities (and city-regions) in effect function as entrepreneurial managers, are they in fact capable of operating completely independently of the state? If not, to what extent are the geopolitical interests of the state aligning with the new managerialist strategies of cities? Where should we draw the (conceptual and territorial) boundaries around the NUM and urban speculation?

In this commentary, I consider these questions by focusing on three geopolitical processes implicated in the NUM: (1) the geopolitics of city-regionalism; (2) the geopolitics of urban environmental management; and (3) the geopolitical implications of the public–private financing of urban infrastructure. My overall aim is to extend and deepen some of the conceptual insights that Phelps and Miao offer by situating the NUM in a geopolitical context.

Upscaling urban governance: The geopolitics of city-regionalism

An implicit argument in Phelps and Miao’s analysis is the idea that the institutions and practices associated with urban entrepreneurialism are not restricted to the jurisdictional limits of the city. When taken at face value, this not an especially novel insight. Peterson (1981), among others, argued that one of the reasons why urban managers must compete is because unlike capital, which is mobile, cities have fixed jurisdictional limits. Yet in contrast to such neo-classical economic reasoning, Phelps and Miao consider whether entrepreneurialism comes from within or without the institutions and territories of urban government. One can push this idea a little further and consider the extent to which the entrepreneurial reach of the city is adjusting territorially better to match the internal and external competitiveness policies of the nation state. One distinct possibility here is the deployment of city-regionalism as a geopolitical instrument or ‘hegemonic project’ (Jessop, 1997) on behalf of the nation state.

In a passing reference to Magnusson (2012), Phelps and Miao argue that the governance of politics at the urban scale predated the government of urban politics by modern nation states. Today, however, urban entrepreneurialism has not only reached beyond its local and metropolitan jurisdictional limits but also that of its host nation states. For example, Wachsmuth (2017) argues that the competitive upscaling of urban governance in the United States is driven not only by the needs of capital (e.g. urban growth coalitions) but also by the agendas of state and local politicians, who regard it as a viable if not in fact necessary strategy for attracting inward investment from outside the United States. It follows that, when considering the territorial reach of urban entrepreneurialism, the state and its territoriality is not simply a part of the problem but also a potential solution.

Phelps and Miao proceed to draw a distinction between territorial and extraterritorial forms of urban entrepreneurialism. The former refer to the proliferation of all sort of new institutional spaces within the city, such as tax-free enclaves, business improvement districts and redevelopment authorities. The latter refer to various forms of urban diplomacy that allow cities to reach out beyond nation state territory. Yet this is a false distinction for two reasons. First, it ignores how the so-called ‘territorial’ urban management innovations often arise from ‘non-territorial’ (e.g. class, racial, etc.) struggles over the distribution of the social product. With the rise of the modern state, urban politics became embroiled in all sorts of national political projects of, and struggles around, socio-territorial redistribution. In the United States, such struggles underpinned the formation of new territorial structures in the state, many of which coalesced in and around cities and metropolitan areas (Cox and Jonas, 1993). In short, urban governance innovation in the form of new local and metropolitan spaces of the state is itself a contingent outcome of all sorts of socially determined conflicts around the spatial allocation of social surplus.

Second, nation states increasingly enrol the entrepreneurial attributes of cities – attributes like creativity, competiveness, resilience and so on – in their own ‘extraterritorial’ efforts to promote international competitiveness (Moisio, 2018). For example, nation states often orchestrate city-regionalism internationally in a manner that allows a national government to channel state resources selectively towards those city-regions that are best suited for nurturing innovation and attracting global investment (on Chinese city-regionalism, see Wu, 2016). Sami Moisio and I therefore argue that city-regionalism is a fundamentally geopolitical process, which reflects an ongoing tension between the attempts of the state to manage the domestic territorial politics of distribution, on the one hand, and its efforts to foster urban entrepreneurialism as a basis for promoting its own internationalization agenda, on the other (Jonas and Moisio, 2018). Entrepreneurial cities as well as larger urban agglomerations, such as city-regions and mega-regions, can be theorized as simultaneously geo-economic and geopolitical constructions, which are strategically mobilized by various local and national political actors in the service of the interests of the nation state as well as local factions of capital and labour.

The new environmental geopolitics of urban development

While research often highlights the entrepreneurial characteristics of contemporary processes of urban development, a range of new environmental policy issues and agendas, especially climate change and sustainability (Long and Rice, 2019), are colonizing emergent ‘spaces of urban politics’ (Ward et al., 2018). One dimension of this new environmental politics of urban development is how urban citizens and voters participate in various urban ‘sustainability fixes’ (While et al., 2004). As Aidan While, David Gibbs and I have argued at some length, discourses, strategies and struggles around urban development frequently underpin the search for some sort of a vision of an alternative and environmentally sustainable (e.g. low-carbon) urban future. Given that Phelps and Miao do consider the diverse ways in which local citizens are enrolled as prosumers (co-producers and consumers) of urban policy, it is worth reflecting on citizen participation in the new environmental politics of urban development.

Given globally pressing issues surrounding climate change, along with all sorts of citizen-led climate emergency measures and initiatives at the urban scale, urban managers and politicians are under increasing pressure to reduce carbon dioxide (CO₂) and other greenhouse gas emissions as a part of strategies to de-carbonize urban development (Rice, 2010). What potentially marks the NUM as quite distinctive from earlier phases of urban development – factors not considered by Phelps and Miao – is that such de-carbonization initiatives are transforming the economic rationale of interurban competition, empowering new strategic alliances between citizens, business organizations and local government, and generating innovative approaches to place marketing and imagineering. This is especially the case for cities that have an appropriate combination of place-specific conditions (e.g. port facilities, proximity to offshore wind farms, access to alternative energy technologies, etc.) to enable innovation in carbon-neutral and renewable energy sectors (Jonas et al., 2011). In such cities, the switch to a low-carbon urban polity often requires the enrolment of citizens as prosumers of new kinds of green jobs and services. Although some might see this as evidence for the ‘green-washing’ of urban governance (Andersson and James, 2018), certain aspects of the NUM are conducive to a host of green urban initiatives, such as freecycling, repair and reuse (the circular economy), and sustainable urban living, many of which involve innovative ways of engaging urban citizens as prosumers.

One of the ‘extraterritorial’ factors driving cities to adopt innovative approaches to urban environmental management is the increasing participation of municipal governments and citizens in urban diplomacy around climate change. City managers, politicians and citizens groups have come to recognize the huge potential for political capital to be realized from pursuing local and global leadership on climate change and exposing the weakness and inaction of the nation state. Nonetheless, if cities are indeed decoupling themselves from nation states with respect to climate policy action, it is perhaps stretching a point to say that they are transforming into green geopolitical actors in their own right. Instead, the growing internationalization of green urban management requires a fundamental rethinking not just of the changing form of urban entrepreneurialism but also of our assumptions about where environmental agendas are located within the presumed spaces of urban politics. At the very least, the ensuing decades could mark the emergence of a new environmental geopolitics of urban development in which cities, states and global environmental politics become increasingly intertwined (Dierwechter, Forthcoming).

Going extraterritorial: Global speculation and the financing of urban infrastructure

Harvey (1989) identified the speculative ventures of public–private partnership as one of the hallmarks of urban entrepreneurialism. In similar yet also different ways, the NUM is characterized by a blurring of the boundaries between the public and the private as urban managers operate alongside a range of new entrepreneurial actors in all sorts of speculative urban ventures. Phelps and Miao intimate that urban speculation today is less likely to occur around the provision of urban public services and more likely instead to involve the capture of surpluses from the redevelopment and exchange of land. Although this is may well be true of cities in the United States, where redevelopment agencies have accrued surplus tax revenues otherwise earmarked for affordable housing and services from inner-city property redevelopment (Althubaity and Jonas, 1998), there is plenty of evidence that urban speculation continues to occur around the provision of basic services and infrastructure.

Facing austerity measures, many public agencies across the United States are turning to private investment consortia to finance and deliver major new investments in urban and regional infrastructure (Hall and Jonas, 2014; Kirkpatrick and Smith, 2011). The availability of federal government grant funding is a key incentive for such speculation. In order to access such funding, cities and regional transit agencies are encouraged to set up new kinds of global infrastructure public–private partnerships (GIP3s) designed to draw down private equity funding for major infrastructure projects (Jonas et al., 2019). A GIP3 typically forms around a private consortium of international construction firms, operators and investors, which enters into a long-term contract with a city or regional public agency to finance, deliver, operate and maintain an infrastructure project, such as a rail transit system or freeway project. Such innovative infrastructure governance arrangements can have significant benefits for cash-strapped public agencies, which seek to extract financial penalties should the consortia fail to deliver projects on time and at cost. Yet they are also risky undertakings that require complex and extended contractual negotiations in which highly territorialized matters of local funding and control come to the fore. Despite the novelty of GIP3 arrangements, territorialized forms of knowledge and modes of governance collaboration remain significant factors shaping efforts on the part of public officials to look for extraterritorial solutions to problems related to the delivery of urban services and infrastructure (Jonas et al., 2019).

At the same time, GIP3 financing arrangements further draw the NUM into the orbit of a ‘geopolitics of capitalism’ (Harvey, 1985). Place-based infrastructure assets are always prone to devaluation and require a high level of urban and regional political stability and a degree of accountability to the state in order to attract global investors. One might even argue that the negotiation of robust contractual arrangements between urban managers and global investment consortia necessitates a form of urban diplomacy in which it is impossible to circumnavigate questions of national security, risk and territorial integrity. At the very least, such efforts to attract private equity financing for urban infrastructure disrupt the relationship between the ‘territorial’ and ‘extraterritorial’ interests of urban managers and raise profoundly complex questions about where to draw the boundaries around the public interest in cities.

Conclusions

Phelps and Miao offer a number of interesting intellectual avenues for exploring further Harvey’s original concept of urban entrepreneurialism. Notably, they argue that the geographies of urban diplomacy involve policy networks that sometimes circumnavigate the nation state and at other times seem to replicate arrangements in the international interstate system. Nonetheless, they are forced to conclude that the NUM ‘remains quite firmly located within, and taking its cues from, its respective nation-state frameworks’ (Phelps and Miao, 2020). In my commentary, I have argued that the NUM is likely to be drawn into a variety of geopolitical processes – city-regionalism, environmentalism, global financing and so on – operating both inside and beyond the nation state.

If there is growing awareness among urban scholars of the limitations of overly territorialized representations of urban politics (Rodgers et al., 2014), there is a corresponding concern that a rigid interpretation of Phelps and Miao’s analysis of NUM could result in under-territorialized representations of urban politics. While their article opens up exciting new ways of thinking about urban entrepreneurialism, it also raises questions as to whether the NUM can be so neatly detached from concepts of the state, territory and geopolitics. In this respect, I would argue that the NUM remains fundamentally a territorialized political project in the state. That said, where one ultimately draws the territorial and conceptual boundaries around cities, nation states, and the public interest remains an open research question.