Goldman, Michael. ‘Speculative Urbanism and the Making of the Next World City.’ International Journal of Urban and Regional Research 35.3 (2011): 555–581.
Goldman begins by alluding to the work of others: "Saskia Sassen, Peter Taylor and the global-city theorists emphasize how global cities, as the home for the rule-makers of global capitalism, are unique spatial configurations generating socio-spatial dynamics geared toward extending and reproducing the power and authority of transnational elite social and corporate networks" (p. 556). He will be adding to their work about global cities, but focusing on the impact on rural communities as cities expand into their formerly rural peripheries.
As he describes the geographic expansion of Bangalore in recent years, Goldman declares, "Land speculation and active dispossession inside and surrounding the city of Bangalore is the main business of its government today" (p. 557). He provides a brief history of how Bangalore became an IT hub in the 1990s, and then states:
"Ironically, it is only since the mid-1990s, through the actual process of making Bangalore into a world city, that Bangalore developed ‘mega-city problems’ rife with rapidly escalating social inequality, mass displacement and dispossession, proliferation of slum settlements, increased caste- and religious group-based violence and tensions, and epidemic public health crises due to severe water supply and sewage problems (in working-class neighborhoods). Roads are extremely congested and vehicles generate such high levels of pollution that many motorcyclists travel around with bloodshot eyes and respiratory problems." (p. 559)
In the 1990s, cities used privatization to improve or develop infrastructure. To do this, they worked closely with international financial institutions (IFIs). One example is water privatization. Instead of treating and distributing water through a public utility, a private company like Bechtel would do the job for profit. Then they decided to privatize more than just water. Most of Bangalore's city agencies are those "shaped and financed" by IFIs like the WorldBank. This reduces democracy as parastatals "depend largely upon external and project financing, and have little or no local oversight, being directly accountable only to the lenders and to the Karnataka chief minister, a party-elected official" (p. 562).
With so much at stake for wealthy private interests, local government is no longer a simple local matter. Goldman gives an example of a political position in a small village now subsumed by the growing city. Before, one leader represented 300 households of his or her neighbors. Now, the local office represents 30,000 people, and it's essentially sold to the highest bidder. Before the issues at hand effected the elected official's farming neighbors; now it affects global capital. Goldman writes: "Cumulatively, one can see a shift in the institutions of governance... For the first time, however, these world-city projects are redefining the art of government, with state–citizen relations becoming shaped by the culture of neoliberal speculation" (p. 564).
The next section provides examples of what he described above: "The international airport, which opened in May 2008, was built and is being run by a consortium led by the Unique Zurich Airport firm and Siemens, receiving highly subsidized land from the government 35 kms north of the city, extensive enough to build 2.5 Heathrow (London) airports. The IT corridor on the city’s eastern periphery is yet to be fully built, on land not yet fully acquired; planned to be 1.5 times the size of Paris, it will be subsidized by the government with the help of a Singapore-based firm. Although intended to have its own local government, it would tap into Greater Bangalore’s refinanced power and water grids." (p. 564-565).
He goes on, describing: "Following the model of regionalized expansion, the Bangalore–Mysore Infrastructure Corridor (BMIC) intends to redirect development away from Bangalore in order to alleviate urban density in the interior and expand the overall space of Greater Bangalore to include new and old townships, small cities, village clusters and agricultural land. Operated by a US-based investor, NICE (Nandi Infrastructure Corridor Enterprises, aka Bangalore–Mysore Infrastructure Corridor — BMIC), this project starts with the construction of a six-lane privately owned toll expressway between Bangalore and Karnataka’s second-largest city, Mysore. The 130 km-long expressway will become a catalyst for regional urbanization, with NICE building five new private townships and multiple industrial parks on agricultural, village and forested land." (p. 565)
The latter project will involve deforestation on a large scale, and the government is leasing the land at less than $1 an acre, making it effectively a give-away to the corporation that hopes to profit from the completed project. Goldman cynically adds that the project will include an "ecotourism center or heritage center, preserving in a museum setting the rural way of life that the thoroughfare and malls may pave over" (p. 565). The toll road will revert to government ownership after a 30 year lease, but the newly built townships along it will be privately owned and managed.
Goldman then makes the point that farmers are left with little choice but to sell their land at depressed prices to the government so that global capital can make a fortune off of it. Farmers cannot sell agricultural land for non-agricultural purposes. Instead, they are selling to the state government, which has a development board that acquires land, builds basic infrastructure upon it, and then sells or leases it to corporations. Farmers receive the depressed price that rural land is worth, not the much higher price that land in a world city is worth. Goldman explains that the rationale for paying low prices to farmers is that they are uncompetitive. But Goldman contends that their failures are not because they are bad at farming, or because farming itself is bad, but because of post-1991 liberalization that ended agricultural subsidies. "In other words," he concludes, "world-city investments depend upon the widespread disinvestment from other local economies, such as the diverse rural and the urban informal" (p. 566). In this case, the government shifted money away from agricultural subsidies and policies intended to keep a large percentage of the population employed on the land, producing enough food for the nation, to those intended to develop world cities.
For farmers who don't want to sell their land - or sell for the low prices offered - as the IT development grows around them, it makes farming increasingly difficult or impossible. For example, the lake they once relied on for irrigation is now polluted with "untreated toxic industrial and household waste" (p. 568). Some of the displaced will not be compensated at all, either because they lack legal titles to their land or because they are landless (farmworkers or tradespeople). Goldman writes:
"Land tenure relations in Karnataka reflect deeply historical, localized, multi-layered and intergenerational sets of informal agreements that have made it possible for laborers, village denizens and small producers to live (many in the most fragile way) and absentee landowners to prosper (Benjamin, 2000b; Benjamin et al., 2007). Reducing rural life to two cut-and-dried categories of landowners and non-owners, with only the former worthy of compensation arising from land acquisition for big urban projects, is to further undermine the social and cultural complexity and livelihood strategies of the rural" (p. 568).
Goldman asks readers to imagine what would happen if the displaced were offered a fair economic value based on the value their land is worth in terms of the profits that will be generated by the grand new development projects. That would spread out the increase in wealth from the new development instead of concentrating it in a few hands as is being done.
As an example of the injustice, Goldman points out that the new ten-lane highway will be serving a city in which the majority of the population does not own a vehicle other than maybe a scooter. The new highway will serve the elite few who own cars, not everyone else. And many of the new jobs coming to Bangalore, such as call center jobs, do not actually pay enough to support a family. Put another way: if there is any sort of trickle down, it's really just a trickle.
Dispossessing the poor to make way for corporations and elites is referred to as freeing up "dead capital." Goldman lays the blame at the feet of the politicians, saying that the land deals provide so much money that all three major political parties are now dependent on it. It's the government that is swindling farmers out of their land.
Goldman then turns to a discussion of the IT sector, asking if it truly has the capacity to fuel never-ending growth in Bangalore. There was a hope that the IT companies could offer their considerable services to local government. However, they charge prices that are low compared to the U.S. (which is why they attract so much business from overseas) but high compared to the local market. The local government cannot afford them. IT's main investment in India is real estate.
The IT firms lease space in "software parks" where they receive tax exempt status. They retain their tax exemption because they threaten to move if the government taxes them. In the language of world-city developers, they are converting "underutilized" space to new, better, modern uses. However, it's farmers on the periphery and religious and ethnic minorities (Tamils and Muslims) in the city who are being displaced or further marginalized. "The social effects of world-city planning in this case exacerbate already tense social divisions as public space and lands shrink in size, use and access (p. 574)."
A word Goldman uses often is speculation. Building such large scale projects is essentially speculation. They are gambling that corporations will come to Bangalore to do business and the large scale projects they've built will be profitable.
"World-city projects not only represent large-scale place-altering capital infusions (i.e. billions of dollars from Dubai, Singapore and the IFIs), they do more than merely facilitate the restructuring of governance institutions for improved access to public goods and services for international capital (i.e. privatization of township governance, special citizenship rights and privileged rules for SEZs). They also trigger new political rationalities of government and technologies of rule that emerge in situ as bureaucrats and political officials, brokering jackpot deals for external clients, generate their own rent-seeking mechanisms of world-city wealth redistribution. These politicians also have to manage the desires of the IFIs that are, paradoxically, pushing for national legislation to repeal the archaic land-acquisition laws which allow for this eminent domain strategy, and for government agencies to possibly produce massive ‘land banks’ for these world-city projects." (p. 575).
He brings up Harvey's term "Accumulation by (mass) dispossession" and also notes that what happens in Bangalore is increasingly connected to other global cities, such that "what happens in Shanghai, Singapore and Dubai matters to small producers and workers in Karnataka" (p. 576).
He concludes with a moving paragraph about the injustice of what is taking place: "During these tumultuous times, the state’s suspension of basic human and civil rights seems to be permanent (Agamben, 2005). In its determination to catch up with Shanghai and cash in on its own world city, the Indian state aggressively uses the rules of eminent domain to acquire land from the few who own land and the many who thrive off the land, and place them on the new multi-lane highway to elsewhere. Many have been reduced to ‘bare life’, no longer covered by legal or civil rights that once guaranteed them some access to the city and its resources, and yet are drowning under new legal reforms and the mobilization of old colonial land laws; these state acts have effectively stripped the majority of their rights to the public sphere, the countryside and the city. Indeed, many Bangaloreans are being actively dispossessed as part of the effort to build up a world city based on a speculative imaginary for world-city investors who may just stay away, and for world-city professionals who have yet to come" (p. 577).