Platkin D., NEO-LIBERALISM ALIVE BUT NOT-SO-WELL IN THE CITY OF ANGELS
NEO-LIBERALISM ALIVE BUT NOT-SO-WELL IN THE CITY OF ANGELS: TOWARDS A DEEPER UNDERSTANDING OF THE URBAN GROWTH MACHINE Progressive Speaker and Film Series on Urban Issues in Los Angeles Doheny Library, University of Southern California, March 2, 2006 Sponsored by the Planners Network For comments, please contact the author: Dick Platkin (dickplatkin@yahoo.com or 213-308-6354) Abstract: As the second largest city in the United States, Los Angeles is extraordinarily important to the local “urban growth machine” and to the national “war machine.” But, Los Angeles’s strategic role in these two overlapping machines is tempered by its precarious political situation. In 1992 Los Angeles witnessed this country’s largest urban insurrection since 1863, and all of the conditions which lead to this multi-racial upheaval still exist. To rule this boiling pot Los Angeles’s non-partisan local government has pursued a relentless policy of neo-liberalism since the late 1980s. City Hall’s broad, bi-partisan public policies have been to replace public sector programs with private sector tax breaks and relaxed regulation, lost revenue with sale taxes and user fees, and non-police functions with more cops and jailers. In the current period, with an increasingly aggressive U.S. foreign policy and fragile real estate bubble, these neo-liberal policies will intensify and reach their limits. This situation, including all of its contradictions, will be placed in the lap of the City’s new mayor. He must ensure that Los Angeles will make a strong, reliable, and increased contribution to both the local growth machine and the national war machine. This will prove to be a daunting and reactionary task because of neighborhood opposition to the growth machine and an absence of public support for the increased sacrifices demanded by the war machine. Furthermore, this active and passive resistance to both machines has tremendous potential for growth during the next decade and could take on the same class character as the 1992 insurrection. I. A Snapshot view of Los Angeles as the ultimate Blue City From one U.S. presidential administration to another, the relentless march towards militarization, war, cutbacks in wages and benefits, greater inequality, and police repression can be seen in America’s cities. What happens locally is not just a mirror of U.S. imperialist activities in other countries; it is essential to its smooth operation. Los Angeles is a perfect example of this process, and it demonstrates how long-term and bi-partisan the international and local components of U.S. imperialism are – despite numerous efforts to attribute imperialism to the current administration and its neo-conservative ideologues. In the case of Los Angeles, it is the second largest city in the United States and a stronghold of the Democratic Party. Every Democratic candidate for national office comes to Los Angeles with an outstretched hand at multi-million dollar fund raisers hosted by party financiers from the entertainment and real estate industries. When they leave, their pockets are stuffed with “political contributions,” most of which have IOU written on the back. City government in Los Angeles is almost entirely run by local Democratic Party politicians, and a few moderate Republicans. Conservative Republicans are now below the local horizon. For example, the city new mayor and the previous mayor are both Democrats, as are 13 members of the 15 person City Council, as were the new Mayor’s four major challengers in the March 2005 primary election. Los Angeles is, beyond doubt, a blue city, in a blue county, in a blue state, and blue region of the United States. Even though the previous mayor, Richard Riordan, was a Republican, his party has virtually no presence in local Los Angeles politics, other than tactical support for their preferred Democrats, such as the new mayor. What we see in Los Angeles is Democrats managing the public sector in a political vacuum. They can run things just the way they want, without worrying about Karl Rove, accusations that they don’t support the troops, are soft on terrorism, are baby killers, or are agents of the anti-Christ. Nevertheless, left to their own devices every Democratic official in Los Angeles city government is in clear agreement with the Bush administration on major, non-religious public policy matters: more cops and jails, tax breaks for the rich, public-private partnerships to deal with public policy problems, regressive taxes for the working class to bridge budget deficits, cutbacks in public programs, wage and benefit cuts for public employees, and excuses and leniency for police attacks on Black and Latin youth. They all thrive in Los Angeles. Consider the following. In recent months: 1. The Los Angeles City Council passed an enormous tax cut for local businesses, which will cost the city at least $100,000,000 in revenue. Its rationale: give the entertainment industry, already fantastically lucrative, a boost. 2. The City Council, with strong support from the new Mayor, gave tax breaks, also worth over $290,000,000, to a billionaire, Phillip Anschutz, to build a downtown hotel / luxury condominium complex near another subsidized project, The Staples Center. When another hotel objected, they were given a sweetener: the right to upgrade and convert 400 units to condominiums. 3. To offset this loss of income, plus long-term budget cuts resulting from less money for local government from the Federal government and the State of California, most of the City Council’s members advocate a half cent sales tax increase to hire more cops. In addition, the Council regularly piles on increased user fees for basic municipal services, such as garbage collection and water. 4. While they are at, the Council and Mayor have also gone after most non-police city employees. With the help of compliant unions, the Mayor and Council have denied most of their employees – but not themselves - a cost of living adjustment this year, even though inflation is now running at annual rate of 15 percent (1.5 percent in September 2005). Employees have also seen the cost of their benefits, such as health insurance, creep up year by year, while hiring and promotions have been frozen for most of the past 15 years. While all local elected officials support these four policies, their understanding of the underlying issues is uneven. Some of their actions are sins of omission which could be charitably attributed to oversight, not conscious intention. But, some pursue these policies with a clear understanding of how these local policies help what this paper later describes as the war machine. For example, even when pressed, none of the city’s elected officials link the cutbacks in local government, which they oversee on a daily basis, to the Iraq and Afghanistan wars, to the mammoth budgets of the Pentagon and the spy agencies, or to amorphous War on Terrorism. The best example is the new mayor, Antonio Villaraigosa, a former teachers union organizer, former ACLU officer, and former Speaker of the California State Assembly. While he has become a favorite of the local and national Democratic Party, he is largely remembered by his past, as well as his occasional soaring rhetoric, not by what he has done or sporadically said in recent years. If his supporters carefully listened to him now, they would hear him advocate tax cuts for business and selected real estate projects, plus more cops paid for by a regressive sales tax. They would also hear him talk of reviving local communities through powerless community councils, as well as the language of sacrifice and service. His approach, almost word-for-word, comes straight from the Washington, D.C. based liberal think-tank, The Brookings Institution, in its book, United We Stand. This is a book on strategies for reviving military conscription, and it relies heavily on the work of Harvard political scientist, Robert Putnam. Putnam’s book, Bowling Alone, called for neighborhood councils to revive a sense of community in large urban areas where it has been lost. From the stand point of Brookings, this is their best strategy for persuading local communities in large multi-ethnic cities like Los Angeles to accept military service as part of their civic duty, as part of the sacrifice for their community, which has become one of the new mayor’s key talking points. A more Theoretical View of Los Angeles: The Rise and Potential Fall of neo-Liberalism: As mentioned above, Los Angeles is the second largest city in the United States. It possesses the country’s largest manufacturing complex, the busiest port, the largest number of documented and undocumented immigrants, and is the world’s media capital As a result, Los Angeles is extraordinarily important to the local “urban growth machine” and to the national “war machine.” But, Los Angeles’s strategic role in these two overlapping political-economic machines is tempered by its precarious political situation. In 1992 it had the largest urban insurrection in the United States since New York City’s anti-draft rebellion in 1863. In a period of 3 days, over 58 Angelinos were killed, over 5,000 buildings were damaged or destroyed, over 2,000 people were hospitalized, and over 17,000 residents were arrested. Furthermore, this insurrection was totally multi-racial, despite ceaseless efforts by the media to later portray it as black versus white or black versus Korean. In fact, it was a working class rebellion, described in the pre-spin version of Newsweek, which came out several days after insurrection’s end, as a rebellion of the have-nots against the haves. (Newsweek, ca. May 7, 1992.) This insurrection also leapfrogged to San Francisco, Las Vegas, Atlanta, Tampa, Seattle, Washington, and Toronto, Canada. It was eventually contained after three days of marshal law decreed by the liberal African-American mayor, Tom Bradley. He also requested the mobilization of approximately 20,000 federal troops and law enforcement personnel from other jurisdictions, including some from northern California, over 600 miles from Los Angeles. (LA Times, May 10, 1992.). This crackdown, in combination with weak grassroots leadership, saw the initial widespread and extremely militant protests over a judicial travesty turn into a carnival of discount shopping (usually called looting by the media) and arson by the second day, with organized crime entering the scene by the third day, before “order” was reestablished by the combined forces of the military and police. Within month’s the insurrection’s very existence was flushed down the memory hole, where it remains until this day. Since then, the policy approach of the city’s officials – most of whom are centrist or liberal Democrats – to rule this politically volatile metropolis has been neo-liberalism. Reflecting market-oriented policies initiated internationally during the 1970s and primarily, but inaccurately, associated with the Reagan administration (1980-88), Los Angeles’s non-partisan local government turned to municipal neo-liberalism in the late 1980s. From then on, the city’s elected officials have pursued a relentless, bi-partisan consensus policy of municipal “Reaganomics.” o They have replaced slashed publicly funded programs with business incentives, offering many tax cuts, tax subsidies, and public-private partnerships to real estate developers and local entertainment industry businesses. o They have also gradually replaced reduced revenue going back to the infamous Proposition 13, approved by the voters in 1979, with more sales taxes, user fees, and bond issues. o They have abandoned comprehensive planning, which is no longer pursued, and when still existing, has been shelved. At the same time, they have eased up on zoning and environmental regulations in order to offer incentives to the private sector. The most notable example is inclusionary zoning, a proposal which requires new apartment complexes to include low income units, but which would be offset by economic incentives, such as a larger building envelope and a reduced parking requirement. o Furthermore, they have downsized all of the city’s non-police functions, such as City Planning, while increasing the budgets and staffing devoted to law enforcement and incarceration. Since 1992 law and order has guided all City policies, and every elected official, including the new mayor, has presented expansion of the Los Angeles Police Department (LAPD) as his or her primary goal. This latter point should not be lost since this increasing reliance in the coercive powers of the state has been their sole response since the 1992 insurrection. Long gone are the liberal New Deal and later war-on-poverty programs triggered by the 1965 Watts “Riot” and dozens of other ghetto rebellions from the late 1960s. This local reliance on policing reflects the same transformation at the national level from liberalism to neo-liberalism and then to the outright neo-conservatism of the current administration. While associated with the Bush II administration, some of these neo-conservative trends can also now be seen in local government practices, including Los Angeles. Everyday examples include computerized picture IDs for all city employees, airport-type security at all public buildings, periodic anti-terrorism drills for public employees, lots and lots of flags, the creation of an LAPD anti-terrorist division (which after three years has yet to catch a terrorist), and extensive dedication of time and energy to the protection of public infrastructure against potential acts of terrorism. In effect, the WWII-era hysteria about Japanese terrorism in Southern California has been resurrected, at least among elected officials in Los Angeles. Current and Near-Future Trends: In the current period, with an increasingly aggressive U.S. foreign and military policy supported by both national political parties and a local real estate bubble which has already peaked and is expected to burst, these neo-liberal policies will intensify in Los Angeles. They will, however, by necessity increasingly rely on the stick instead of the carrot as they fail to meet expectations. This why the Los Angeles City budget for fiscal year 2005-6 was quickly approved by the City Council to grant the LAPD a nine percent increase, while keeping the other city departments flat. In the view of the distinguished Marxist geographer, David Harvey, neo-liberalism already reached its limits by the end of the Clinton era, which is why neo-liberal policies have been gradually supplanted by neo-conservatism at the Federal level, and now at the local level. According to Harvey: The volatility inherent in neo-liberalism ultimately returned to haunt the heartland of the United States itself. The economic collapse that began in the high-tech dot.com economy in 1999 soon spread to reveal that much of what passed for finance capital was in fact unredeemable fictitious capital supported by scandalous accounting practice and totally empty assets. Even before the events of 9/11, it was clear that neo-liberal imperialism was weakening on the inside, that even the asset values of Wall Street could not be protected, and the days of neo-liberalism as a specific form of imperialism were numbered... The fortuitous election of George W. Bush, a born-again Christian to the US Presidency brought a group of neo-conservative thinkers close to power. The neo-conservatives, well funded and organized in numerous “think tanks” like the neo-liberals before them, had long sought to impose their agenda on government. And it is a different agenda from the of neo-liberalism. Its primary objective is the establishment of and respect for order, both internally and upon the world sage. This implies strong leadership at the top and unwavering loyalty at the base, coupled with the construction of a hierarchy of power that is both secure and clear... The Bush Administration is, therefore, dominated by neo-conservatives, deeply indebted to the military-industrial complex (and a few other major sectors of American industry, such as energy and agribusiness), and supported in its judgements by fundamentalist Christians. Their task was to consolidate power behind a minority-lead political agenda within the territorial logic of power. In this they well understood the connection between internal and external order. They intuitively accepted Arendt’s view that empire abroad entails tyranny at home, but state it differently. Military activity abroad requires military-like discipline at home. David Harvey, The New Imperialism, pp. 189-193 Dealing with this complicated situation will be the major challenge facing the city’s new mayor, Antonio Villaraigosa. Despite his liberal credentials, and associations with the quintessential neo-liberals, the Democratic Leadership Committee, he reflects the gradual acquiescence and absorption of the neo-conservative viewpoint, described above by David Harvey, into the Democratic party’s leadership. In addition to chairing the Kerry campaign in California, he was also co-chair of the hawkish platform committee at the Democratic National Convention in Boston in July 2004. The new mayor must ensure that Los Angeles will make a strong, reliable, and increased contribution to both the growth machine and the war machine. Furthermore, although these two machines overlap, they have their subtle contradictions, as well as growing active and passive opposition from the public, two-thirds of whom skipped the recent mayoral election, setting a modern record. As pointed out by Chalmers Johnson in Blowback, the domestic cost of the permanent war economy -- strongly supported by liberals, neo-liberals, and neo-conservatives -– is domestic implosion resulting from imperial overstretch. Simply put, massive national military budgets, in combination with the focus of California state government on prison construction and prison guards, forces cutbacks on local government. Furthermore the Pentagon budget is now expanding at the rate of four percent per year and will reach between $451- 491 in the next fiscal year. This figure, by the way, is separate from the annual $80-100 billion supplementary budget allocations for the occupations of Iraq and Afghanistan, as well as the $50 billion spent per year on the Department of Homeland Security. These enforced reductions in local infrastructure investments and public services, in turn, pass the costs of previously offered service onto individuals, as well as to the private sector portions of the growth machine. While the growth machine’s costs can be temporarily covered by tax breaks and subsidies to developers, these practices, too, will reach their practical limits. Each withheld tax dollar forces a contraction in local government, at the exact time when the growth machine needs more not less help from government, as well as more no less support from residents adjacent to their projects. Importance of Los Angeles to the Urban Growth machine: As described by Harvey Molotch in Urban Fortunes, the growth machine is that complex of developers, contractors, realtors, lenders, unions, utilities and supportive elected officials who collude together to use local government as a catalyst for local real estate development. He further explains: Because so much of the growth mobilization effort involves government, local growth elites play a major role in electing local politicians, “watchdogging” their activities, and scrutinizing administrative detail. Whether in generating infrastructural resources, keeping peace on the home front, or using the city major as ambassador to industry...local government is primarily concerned with increased growth... Harvey Molotch, Urban Fortunes, p. 66 Los Angeles is closely identified with the post-WW II boom in home construction, and it has taken nearly six decades for the entire city to finally be developed. The companies which grew out of this boom, however, have not yet folded their tents and are still strongly active in the local growth machine. While they focus on in-fill projects in Los Angeles, they are also actively developing new projects in suburban and rural areas in a metropolitan area which now takes at least three hours to drive across. The best known growth-machine billionaire to leave his mark on Los Angeles is Eli Broad. He not only brought the Democratic National Convention to Los Angeles in 2000, but nearly all major new projects, such as the Disney Concert Hall, the new Caltrans Building, a remodel of the Los Angeles County Art Museum, a billion dollar new public-private project in the CBD, and a high school for the performing arts, result from his local initiatives. But, his influence is more widely felt than a splurge of his pet monumental architecture. He also selected the current Superintendent of Schools in Los Angeles, former Colorado governor, Roy Romer. Romer in turn, moved the headquarters of the school district into a Broad-owned high rise office-building and then initiated a construction program to acquire property and then build 83 new schools in Los Angeles. Broad’s influence also extends into City Hall. He, and another billionaire, Ron Burkle, were the mayor-elect’s major backers in his unsuccessful 2001 mayoral campaign. And, each billionaire has an assistant who plays an important role in the Villaraigosa administration. Barry Swiller, a Burkle associate, played a major role in recently getting donations from the Cuban community in Miami for Villaraigosa. In Broad’s case, Robin Kramer, an official from his personal foundation and the chief of staff for former mayor Richard Riordan is spending about 16 hours per day heading up the new mayor’s transition team. Her job? Select the people to take over 43 city departments, 300 commission appointments, and the mayor’s office staff. Importance of Los Angeles to the National War Machine: First, let us establish what is meant by war machine. The war machine, sometimes called the permanent war economy, is really nothing more than U.S. imperialism. The term implies that the war machine is driven by profiteering, but this facile claim, that a military-industrial complex interested in nothing more than immediate profits generates U.S. military interventions abroad, has been put to rest by Chalmers Johnson. In his new Sorrows of Empire, he argues that profiteering is a by-product not a cause of US imperialism, and that the gradual assemblage and maintenance of the US empire began with the Spanish American war of 1898 and has continued onward for over a century, regardless of the political affiliations of the President and the Congress. The war machine has recently produced the Iraq and Afghanistan invasions and occupations, with undoubtedly more to come. In Johnson’s view, profiteering has distorted US imperialism, such as the prominent role of Halliburton in Iraq, but is not the root cause, which is in the greater economic value of foreign investment over domestic investment. Second, the importance of the Los Angeles area to the war machine takes on many aspects. The city’s port, adjacent to the port of the city of Long Beach, is the point from which war material flows to Asia. From WWII to Vietnam to the current wars in Afghanistan and Iraq, Los Angeles is essential for shipping everything from fuel to weaponry to the U.S. military. This is why President Bush invoked the Taft-Hartley Act during his first administration to present a strike the longshoreman’s union, the ILWU. It also explains why a bottleneck in deliveries in Christmas presents from China, prompted enormous press coverage of alternatives to expand the port. Other essential components are the city’s and region’s enormous manufacturing and technology base. While many high tech firms like TRW, are already hard at work for the war machine, others could be quickly retooled to produce a full range of war materials. The enormous work force for the city’s industries is largely Latino, and they serve another function, as well. They are enormous source of cannon fodder for the military, especially if the volunteer army becomes a conscript army. Will City Hall be up to the task? Can the city’s officials manage to serve the demands of these two machines while maintaining their own legitimacy, generating broad public support for downsizing the non-police functions of city government, and ensuring that social peace is maintained in a Los Angeles which mostly consists of non-voters with clear memories of an urban insurrection. Success is unlikely, even though many local observers have an irrational exuberance about the new mayor. Liberal and left-liberal hopes have not yet been stacked up against reality. A history of union and civil liberties activism encompass most of the city’s liberals and left-liberals, such as Peter Dreir. He wrote on the Common Dreams website (www.commondreams.org. May 28, 2005) that the new mayor’s achievements in the State Assembly, his personality, and his enthusiasm will allow him to overcome such barriers as a loss of funding from the Federal government. The supporters of the new mayor have not yet grasped that challenges to U.S. imperial hegemony in this period percolate quickly to local government and that nearly all city officials will play their dutiful role in meeting all of these external demands. Cut backs will continue to be imposed on local government as the full range of military expenditures increases. The growth of rival competitors in Asia and Europe ensures that the U.S. empire will not voluntarily retrench. Sometimes these effort appear as non-military dirty tricks, such as the efforts to overthrow Hugo Chavez of Venezuela. Other times they take the form of outright colonial occupations, such as Vietnam, Iraq, and Afghanistan. In the case of Iraq, escalation appears to be the only recourse of the United States government, and this escalation may also take the form of a strategic attack on Iran, as widely predicted by such reliable analysts as Seymour Hirsch, Michael Klare, and Scott Ritter. Further reading: Farhang, Mansour, U.S. Imperialism from the Spanish American War to the Iranian Revolution, South End Press, Boston, 1981. Harvey, David, The New Imperialism, Oxford University Press, Oxford, 2003. Johnson, Chalmers, Blowback: The Costs and Consequences of American Empire, Henry Holt and Company, 2001. Johnson, Chalmers, The Sorrows of Empire: Militarism, Secrecy, and the End of the Republic, Metropolitan Books, New York, 2004. Logan, J. and Molotch, H, Urban Fortunes: The Political Economy of Place, University of California Press, Berkeley, 1987. Piven, Frances Fox, The War at Home: The Domestic Costs of Bush’s Militarism, The New Press, New York, 2004. Pollin, Robert, Countours of Descent: U.S. Economic Fractures and the Landscape of Global Austerity, Verso, London and New York, 2003.
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