Click
here for info on the Print Journal
(and to purchase your copy)!
Globalization and Class Division in American Cities
By Sarah Stodola
---------------------------------------
There is no doubt that globalization has had a profound effect on America's major cities, and indeed, the subject has been addressed tirelessly in academic circles. As Saskia Sassen explains in her book, Cities in a World Economy, "Economic globalization, accompanied by the emergence of a global culture, has profoundly altered the social, economic, and political reality of…cities." These changes have been profound and widespread. They have changed the way people in these global cities, and in fact in other places that rely on global cities, approach their lives.
One of the phenomena most commonly associated with globalization is class bifurcation. Some (Sassen included) argue that class polarization is a direct result of globalization. Others (such as Janet Abu-Lughod) believe that globalization is but one factor in the rise of class inequality. They claim that the theory that globalization is the sole cause of class polarization in American cities seems to oversimplify what has really occurred. Sassen and Abu-Lughod represent prominent opposing theories regarding globalization and class polarization. Sassen, in Cities in a World Economy, and Abu-Lughod, in New York, Chicago, Los Angeles (a book which was, in fact, a response to another of Sassen's books), both interpret the development of New York into a global city with a large upper and lower class, and an increasingly invisible middle class. Each scholar discusses how globalization did (or did not) influence this process, and to what extent. However, it seems that in both cases, control of the federal government by the elite has been largely overlooked as a major factor of class polarization in America by both authors.
In Cities in a World Economy, Sassen explains that the dominance of manufacturing in the economic makeup of global cities after World War II facilitated the development of a vast middle class. In this economy, workers could make a good living without having received an advanced education. From the late 1960s on, however, manufacturing declined as the service sector gained prominence. New service sectors (computer, technical, foreign investment, etc.) evolved as old sectors (production, FIRE, etc.) reorganized. Advances in technology allowed for the decentralization of production away from large cities, and an "information economy" took its place within global cities. An Information Economy, as defined by Sassen, is the "concept used to describe an economic system dominated by industries that produce, manipulate, and/or transmit information; more narrowly, that sector of the economy constituted by such industries, notably specialized services." Cities of the information economy require large numbers of highly educated workers (brokers, lawyers, computer engineers, and the like), who are paid well and form the upper class. Those who once constituted the vast middle class of people supported by the manufacturing industry, find themselves in a large and dense pool of workers who are now forced to take low-paying or part-time work.
This has resulted in an urban economy in which the upper class depends on the vast availability of low-wage labor, and where the gap between the rich and poor is continually widening. It is important to note that Sassen sees these developments as a direct result of globalization. When she does address New York City, as she does specifically in Chapter four, it is in the context of how New York City experienced a financial crisis because of its position in the global market, and how the result of this crisis was that New York has become even more global.
Janet Abu-Lughod also deals with the phenomenon of class bifurcation in New York, Chicago, Los Angeles, albeit from an admittedly different perspective. She contends that class polarization developed through a combination of globalization and factors already in place in individual cities. In fact, the format she chose for this book seems to confirm this contention. She examines, in extraordinarily thorough detail, the three "global" American cities, both historically and according to their position in the global economy. Each city, while a part of the global system, retains a distinct structure and character. According to Abu-Lughod, this can only be attributed to factors outside of globalization. She acknowledges that globalization has had a profound impact on the class structure of American cities. Indeed, she agrees with most of Sassen's assertions. She agrees that all three of American's global cities have been similarly affected by such factors as foreign investments, international markets, and transnational corporations (TNCs).
However, she does not accept Sassen's theory of class bifurcation as the sole element in the perpetuation of class bifurcation. In the case of New York City, Abu-Lughod attributes such factors as spatial/geographical concerns, diversity of immigrants and the relatively accepting attitude New York has toward them (although, it could be argued that immigration is directly related to globalization), and the New York region's fragmented political structure to increasing class polarization. She also observes that many signs of class polarization were already in place in New York before the current restructuring of the global economy, of which the city is a central player. Abu-Lughod sums up her argument regarding class polarization in the following passage:
If bifurcation were a mechanical and inexorable consequence of globalization, one would expect to find few variations from country to country and from global city to global city. This is clearly not the case. I do not question the general finding of growing inequality, but the story of its causes and its spatial consequences is far more complex and is being played out somewhat differently region by region and in rural and urban places both large and small The evidence from the three cities (New York, Chicago, and Los Angeles) suggests important variations that call into question a single monolithic set of causes.
* * *
The U.S. government has played a substantial role in the perpetuation of class polarization in America - a factor that both Abu-Lughod and Sassen seem to underestimate in their interpretations of the trend. Sassen does heavily acknowledge the impact of international legislation - in fact, this is one of the central components of her argument. But it seems that she allows this to overshadow the influence of national legislation (or lack thereof) on class bifurcation in the three American global cities. One might expect Abu-Lughod to place a heavy emphasis on issues of the federal government, which she does in some respects. For example, she makes the federal government's involvement in welfare programs and military contracts, and the influence of the policies in these areas on the three global cities of America. However, she does not seem to thoroughly cover the relationship between the federal government and the nation's (and New York's) upper class.
Where the authors do mention this aspect of national politics, they seem to do so only in passing, not recognizing it as a substantial factor. Sassen may bypass this factor because of her belief that globalization is the single factor affecting class bifurcation in America. While Abu-Lughod does, on the other hand, devote a few pages to the topic (pp.275-280), it seems that she owes the topic a bit more attention.
In an excellent article examining the issue of class polarization in America (titled "For Richer," and appearing in the New York Times Magazine late last year), Paul Krugman claims that class polarization evolved because of a change in the social norms of the country, not because of globalization or advances in technology. He states that "wages -- particularly at the top -- are determined by social norms. What happened during the 1930's and 1940's was that new norms of equality were established, largely through the political process. What happened in the 1980's and 1990's was that those norms unraveled, replaced by an ethos of 'anything goes.' And a result was an explosion of income at the top of the scale." And, of course, there must be an underlying reason for this shift in the norm. Krugman attributes this shift largely to national politics. Increasingly, the rich have become richer, and at the same time, they seem to have gained correspondingly more control over the federal government.
In short, the policies of our federal government enforce and encourage class polarization. As Krugman states, "…as the rich get richer, they can buy a lot of things besides goods and services. Money buys political influence…" And with this political influence, the rich ensure their wealth, leaving the others without a chance. Of course, it would take further study on my part to absolutely confirm this theory. However, I believe that the following are all true: The rich have been given more and more tax breaks over time. The government had been increasingly hostile to labor unions. Minimum wage, adjusted for inflation, has decreased, and anti-trust laws and other laws regulating corporate greed have been done away with. The federal government has become, in a way, a tool of the rich. This issue has been largely overlooked by both Sassen and Abu-Lughod. For Sassen, it may make sense to omit national politics from her argument, since she is arguing that class polarization is a result of globalization, and not national, regional, or local issues. But in Abu-Lughod's case, it seems that concentrating a bit more strenuously on the national political scene could have strengthened her already sound theory that globalization is but one factor contributing to class polarization in America.
Class Polarization has become an inescapable fact in America, and it is even more pronounced in America's large cities. Both Saskia Sassen and Janet Abu-Lughod deal with how this phenomena has been perpetuated in America's global cities. Sasssen asserts that globalization is the central cause. Abu-Lughod claims that class polarization was caused by a combination of globalization and other factors that have long been in place in America's cities, and that allow each city to retain a distinct character in the face of sweeping globalization. However, as Paul Krugman's article points out, class polarization is largely a product of the rich's influence on the national government. Indeed, it does appear that Americans are increasingly living in a plutocracy, and this is a factor that simply cannot be overlooked in the discussion of class polarization.
---------------------------------------
Sarah Stodola is the Managing Editor of Me Three. She can be contacted at sstodola@methree.net.
© 2003 Me Three