Power of capital in decentralization<\/p>\n
The following is the first of two articles on cities under
\ndecentralization by architect and urban expert Marco
\nKusumawijaya.<\/p>\n
JAKARTA (JP): It is not only local aspirations that have led
\nthe drive for decentralization. Capitalism in its latest form has
\nan equal interest in encouraging competition among cities and
\nregions, as this will increase the capitalists' respective
\ninvestment bargaining positions vis-a-vis the host areas.<\/p>\n
Borders and any predetermined hierarchies are set to crumble.
\nEarlier, governments could design the hierarchy of cities,
\ndetermining which would have harbors, airports and different
\nclasses of hospitals, for instance. But the relative position of
\ncities can no longer be planned, and will depend largely on the
\nentrepreneurship of respective urban governments.<\/p>\n
More than ever, market integration and the advance of
\ninformation technology is totally changing the relationship
\nbetween capital and space. The freedom of capital from place --
\neven in the acquisition of raw materials -- has increased its
\nbargaining position towards place.<\/p>\n
It is the place that now depends on the flow of funds,
\nproduction and consumption. \"Place\" becomes meaningful only in so
\nfar as it provides enough incentives to facilitate the operation
\nof capital.<\/p>\n
There has been an inevitable shifting of urban governance to
\nentrepreneurialism since the 1980s. Before this, local
\nauthorities simply carried out prescribed programs without taking
\nthe initiative to seek out fresh economic opportunities.<\/p>\n
At the end of Indonesia's New Order, the central government
\nhad indeed been very \"entrepreneurial\", but in a very opaque and
\ncorrupt way. Many bad deals were made at the long-term expense of
\nthe country at large -- remember the cases involving mining and
\nlogging concessions.<\/p>\n
Now, certain forms of entrepreneurialism will move to the
\nregions and cities, which the local authorities are quite well
\naware of. The mayor of Bogor, West Java, has said his
\nadministration \"must offer incentives to business and investors
\nso that they will invest in Bogor\".<\/p>\n
The concern here is: How can the cities and regions
\nindividually face up to the increasing bargaining position of
\ncapital?<\/p>\n
Without proper preparation, entrepreneurialism can be corrupt
\nand incompetent, just as it had been under the New Order.<\/p>\n
In Jakarta, the dubious entrepreneurial style of urban
\ngovernance has indeed continued, and there is neither
\ntransparency nor any clearly stated public mission.<\/p>\n
This style of governance has been driven by vested interests
\nin the absence of rational and transparent accountability.
\nPrivate interests have dominated spatial planning and
\nprivatization models.<\/p>\n
Entrepreneurialism is, of course, concerned with the quality
\nof places, but this is mainly to please the interests of capital,
\nnot the population. The Jakarta governor, for example, has often
\ninsisted on the need to regulate sidewalk vendors, pedicabs
\nstreet children and others, to project a better image of the city
\nin the eyes of diplomats and foreign investors.<\/p>\n
However, increasing competition between cities will weaken the
\nbargaining position of each of them. The creation of specialized,
\nhighly privileged individual places for investment will fragment
\na city internally, create systemic instability in terms of land
\nprices, land-use balance, and their further down-stream
\nconsequences -- and will tend to downplay workers' interests.<\/p>\n
The paradox is that in response to the capitalists' demands
\nfor better places, overindulgent incentives will be offered that
\nmay cause social and physical damage, and subsidies paid at the
\nexpense of the whole city to the disadvantage of the working
\nclass.<\/p>\n
Threats to the environment have been reported, for example, as
\nthe result of deals concluded between local governments and
\nlogging companies in East Kalimantan. These threats have led to
\nviolent conflicts involving locals, which is obviously not in the
\ncapitalists' interest.<\/p>\n
In Jakarta, superblock developments are instructive cases on
\nhow entrepreneurialism can become misguided speculation.<\/p>\n
Entrepreneurialism must indeed encourage the development of
\nthose activities that have the strongest localized capacity to
\nenhance property values, the city's tax base.<\/p>\n
Therefore, superblocks are developed to create \"cities within
\nthe city\". The idea is to create a model of \"a better place\" for
\nthe whole city. As such, Jakarta's superblocks are designed to
\nshow that the capital is capable of satisfying the tastes of the
\n\"globapolitan\" elite. The superblocks are supposed to create a
\n\"better\" urbanity. Is this possible or just an empty promise?<\/p>\n
Superblocks will undeniably possess quality infrastructure and
\nsmooth traffic. These could be easily designed to produce the
\nhighest possible level of efficiency. But this applies only
\ninternally -- not to the entire city.<\/p>\n
Outside the superblocks, their effects disadvantage the city
\nas a whole. Even if traffic is fine inside the blocks, their mere
\nexistence generates a tremendous number of trips from the various
\nparts of the city towards them.<\/p>\n
A superblock of 20 hectares with a floor area ratio of five
\nwould attract at least 100,000 white-collar workers with 20,000
\nprivate cars. And with no residences inside the block, all these
\npeople will come to and leave from the blocks at about the same
\ntime every morning and afternoon.<\/p>\n
Dwelling units built inside these blocks are mostly only for
\ntop executives who occupy a mere 2 percent of the total
\nemployment provided.<\/p>\n
The superblocks, therefore, enjoy subsidies from the entire
\ncity in the form of social and maintenance costs. In the
\nmeantime, the government provides direct subsidies in the form of
\nan increased floor-area ration at the price of a cash penalty
\nthat can be easily overcome through corruption.<\/p>\n
The city also loses significant housing space for the middle
\nclass. During the last decade, while the central business
\ndistrict developed about 1.9 million square meters of new office
\nspace, the equivalent of about 500,000 new jobs, with around
\n300,000 real jobs actually being created, Central and South
\nJakarta lost 314,688 inhabitants who moved out to the suburbs.<\/p>\n
A major part of the land that they left behind is still empty
\nspace behind the rows of high rise buildings along the avenues of
\nJl. M.H. Thamrin, Jl. Sudirman and Jl. H. Rasuna Said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/power-of-capital-in-decentralization-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}