Community Development Under Capitalism
By Christian Noakes
The dispossession of working class communities has always served as a prime avenue for the accumulation of capital. In places like the US this practice is aimed disproportionately at communities of color. However, the ideological dominance—and thus stability—of capitalism requires that this process be framed as benevolent or progressive. With regards to urban development, the bourgeois conception of community reinvestment is key.
Under capitalism, the concept of community reinvestment is not defined by the continuity or maintenance of relations between people in a particular place but by property value and potential profit. As such, many who invoke the term take devaluation for granted. The ecological common sense of urban change has in many ways evolved to justify not only the devaluation of place but its gentrification as well. Lenders are now competing to make loans in previously divested areas not for the benefit of the dispossessed but to expand to new markets and increase profitability. Under this increasingly global form, class and ethnic inequality are intensified through processes of divestment, reinvestment and the closing of the rent gap.
The Destructive Nature of Closing the Rent Gap
According to the rent-gap theory, gentrification occurs where the gap between current ground rent and potential ground rent is the greatest. A decline in exchange value or price is in fact what makes changes in land use and occupation profitable. Because of the need for capital to expand outward and toward the highest possible profits, investors are drawn to the cheapest land available. The preceding devaluation of land is itself signaled by wide-spread negative perceptions of place and communities—a sociosymbolic process of territorial stigmatization. Coined by Loic Wacquant, this is the phenomenon of symbolic dishonor and denigration projected onto a given place so that negative connotations come to define it in the public psyche. Stigmatization and the subsequent devaluation and disinvestment it signals are prerequisites for gentrification. Kallin and Slater demonstrated how territorial stigmatization created the conditions for the gentrification of Craigmillar—a working-class district in Edinburgh. This case reflects a common cycle of devaluation and displacement in which the blemish of place designates areas as eligible for “regeneration” or “revitalization.” Neoliberal development is most effective because it does not openly contest community reinvestment but subverts it for the sake of profit.
Residents of these communities find themselves stuck between disinvestment and displacement. The duality of devaluation and reinvestment divorced from the needs of community functions to justify the creative destruction inherent in processes of gentrification. Rather than being seen as development that monetizes and rips apart communities, gentrification is taken to be a natural and necessary process to build communities. This creative aspect obscures the destructive nature of gentrification. The neoliberal assumption that supposedly natural market signals can and should dictate development is central to this reconstruction of space. The process is thereby reduced to a series of “market signals” in which stigma justifies divestment and divestment justifies gentrification.
Under the neoliberal paradigm, community reinvestment has become a means of softening rather than preventing gentrification. The colonial mentality of improvement serves to support the hegemonic view in which the antagonism between community reinvestment and gentrification is obscured. A significant source of this antagonism comes from the blemish of place that is rubbed off onto residents. To do away with the associated “blight” while maintaining a benevolent image of communal uplift therefore requires divorcing conceptions of community from the people that comprise them. Public and private developers can then claim to be reinvesting in a community while promoting practices that displace long-time residents who, through popular discourse, come to personify the stigma of place. This conception turns communities into commodities, thereby reducing human relations to the relations of things. It is this reification of communities that enables investors and developers to equate gentrification with community reinvestment. It is after all, reinvestment in the neoliberal conception of community. With strict adherence to individualism, people become atomized and replaceable components. Even more important, the reduction of community to property implies community uplift is nothing more than investing to increase property values or profitability. It is through the commodification of community that gentrification becomes taken for granted.
In addition to naturalizing this form of neighborhood change, devalorization of place enables public and private institutions to frame development that has been shown to displace long-time residents as a beneficent force. Territorial stigmatization plays a fundamental role in misrepresenting the destruction of communities as the conservation of communities that are apparently on the verge of falling into irredeemable blight through misuse. As Jackson states, “[v]iewing a neighbourhood as a wasteland uninhabited by anything or anyone useful, waiting there for the taking, resonates as a new form of terranullius.” Much like the rent gap, the construction of colonial space (i.e. space of the subaltern) is rooted in territorial stigmatization. It is through the blemish of place that appropriation for the sake of “improvement” is justified. Therefore, gentrification is a process with intersecting neoliberal and colonial components of the capitalist system.
There is perhaps no more explicit example of the colonial, anti-poor mentality than Christian Evangelical pastor and urbanist Robert Lupton’s “gentrification with justice.” For Lupton, gentrification benefits low-income communities that are exposed to values that he assumes they would otherwise lack. Justice to him is little more than colonization by a supposedly beneficent and superior gentry. Unlike other apologist paradigms that ignore or downplay the potential for displacement, the gentrification with justice paradigm celebrates displacement as a positive means to separate what Lupton considers deserving from undeserving poor. He sees the latter as a sickness to be purged from blighted communities. Lupton asserts that gentrification is not unconditionally positive but is dependent on a “gentry with vision who have compassionate hearts as well as real estate acumen.” This assumed superiority of middle-class Christian consumers facilitates appropriation by making it appear altruistic. Just as with the colonial expansion of European imperialists, the church operates for Lupton as a superstructure to support exploitation and appropriation. While Lupton’s Evangelical gentrification is uniquely similar to European colonization for the role of the church, more secular apologists for gentrification retain the use of implied superiority as license for appropriation. This melding of paternalistic stigmatization of the working-class communities and the tendency of opening up “new markets” in search of profit is characteristic of modern neoliberalism.
Programs and Policies
The process of gentrification turns around an ideology of blight and the supposed naturalness and efficiency of “free market solutions.” It is common to see news stories suggesting that commerce-based culture is the remedy for urban poverty. Likewise, programs such as HOPE VI have sought private, market-based solutions at the cost of low-income residents. This assumed benevolence is reflected in the language of “regeneration” and “renewal.” Euphemisms for a process that objectifies and demonizes as means of appropriation discourages contesting gentrification as a natural outcome of development. It is this misrepresentative language—supported by an ideology of blight and the commodification community—that perpetuates the façade of gentrification as community reinvestment.
HOPE VI—a program that was intended to address the needs of public housing residents via mixed-income development—also reflects the conflation of community uplift with privatization and profitability. While it has changed to some degree throughout the program’s implementation (from 1922 - 2010), its development has always been firmly rooted in neoliberalism and stigmatization of working-class communities. Early in the program’s development HUD tilted the scales in favor of greater private, market-based development. The shift began in 1994 when they ruled that public housing could be privately owned. They also repealed the one-for-one replacement requirement meant to protect affordable and public housing stock. In 1996, HUD also adopted a mixed-finance approach in which grantees were encouraged, by limits on government contributions, to leverage additional private investments, thereby further strengthening the role of private entities. The increased deregulation and privatization led to the inclusion of more moderately subsidized and market rate units. While HOPE VI projects have varied greatly, the neoliberal logic and process of development remain consistent across sites. Projects were united by the core practice of public-private partnerships and the assumed validity of transforming public housing into mixed-income developments to address the needs of low-income residents. As the program developed, focus shifted further away from helping public housing residents through revitalization efforts and more toward attracting business investment. Site selection became less about the need for improving living conditions and more about whether developers thought a location could generate profits.
HOPE VI projects have varied due to the lack of standardization or criteria for mixed-income development that might otherwise differentiate between integration and appropriation. To overcome this obstacle Hanlon limits his analysis to the project often considered one of the most successful—Park DuValle in Louisville, Kentucky. He found that, rather than addressing the needs of public housing residents, the program effectively took the area over at the cost of low-income residents. On-site (i.e. in the community), there was a total loss of 753 public housing units, with 603 units directly lost while factoring in the 150 units built elsewhere. While 67.1% (876) of displaced households received some form assistance in relocating, 69.7% (611) of these households were merely moved to non-HOPE VI public housing. The remaining 30.3% (265) of assisted displaced households received vouchers which were then concentrated in other high-poverty areas. 32.8% (428) of displaced households received no form of assistance. The fact that such a disruptive program can be regarded as a success is evidence that “public housing policy has increasingly become aligned with the broader unfolding of neoliberal urban processes.” The case of the Park DuValle project reflects the trend of private, market-based development that appropriates space under the guise of poverty alleviation and community uplift.
Centennial Place in Atlanta is also lauded as one of the more successful HOPE VI developments. This project entailed a severe reduction in public housing—much of which was replaced with market-rate units. Approximately 17% of original residents were able to return, thereby pushing the majority to private market routes. With only about a third of the units reserved at a level manageable for most original residents, Atlanta also saw one of the most severe reductions in public housing stock. Such cases illuminate the stark contrast between the rhetoric and reality of HOPE VI. If Park DuValle and Centennial Place were successes, then the goal of such projects was not to address the shortcomings of public housing but to reclaim space for development. The framing of these projects as successful responses to the needs of public housing residents reflects the dominant belief in private market solutions and the stigma of poverty and public housing.
In 2010 HOPE VI was effectively replaced by the Choice Neighborhoods Initiative (CNI) as a mixed-income solution to public housing and in 2011 the first implementation grants were distributed to support projects in Boston, Chicago, New Orleans, San Francisco, and Seattle. Like its predecessor, CNI pursues a mixed-income solution to low-income housing and distributes funds through competitive demolition and rehabilitation grants. It also retains the neoliberal logic that emphasizes public-private partnerships, mixed-finance, and market-based solutions. Just as with HOPE VI, the lack of standardization has meant wide variation in practices and outcomes. The program also built off of HOPE VI to make developments both more ambitious and inclusive. Gebhardt identifies three key areas of expansion: it expands the development from single properties to entire neighborhoods (and districts in some cases), eligibility from Public Housing Authorities (PHAs) to include cities and non-profit organizations, and eligible properties from public housing to other distressed HUD-assisted housing.
CNI has addressed one of the most immediate and fatal design flaws of HOPE VI by requiring one-for-one replacement of all public housing units subject to demolition. Policy makers have also sought to address the issue of displacement by promising the right of return to all residents that have not violated their lease. However, more research is needed to determine the extent to which the right of return is enforced or effective in preventing displacement. The right to return also does not appear to help many considered “hard to house” who might be ineligible for participation. As with other mixed-income developments that exclude segments of the original community, CNI practices lay implicit blame on the victims of community divestment and decline. For all its important differences and early observable improvements, HOPE VI has served as the foundation of Choice Neighborhoods. Like its predecessor, it often equates community development with business or private market interests. Both programs rely on the assumptions of trickle- down economics, the implied pathology of working-class communities, and the increased privatization of housing assistance. This capitalist orientation leaves the door open for further neglect of and attacks on the very communities intended to be helped.
In addition to the stigmatization of poverty, recent trends in neoliberal development have invoked principles of inclusion and self-representation. Community Benefits Agreements (CBAs) are an increasingly common way to promote more inclusive community development. These agreements are "standalone, legally enforceable contract[s] between multiple community groups and ... private developer[s], requiring community benefits from the developer[s] in exchange for the community groups' support of (or non-opposition to) [a] project."
Terms of agreement are often used to push for development that benefits the community by establishing quotas for affordable housing and jobs. While CBAs have the potential to include communities in the processes of development, it is largely up to developers whether to sign any such agreement. Where developers have no desire to meet the needs of residents they can simply refuse—as developers did to the neighborhoods surrounding Turner Field in Atlanta. Despite the enforceability of community contractual obligations, participation is voluntary. As the case of Los Angeles’ Sports and Entertainment District CBA illustrates, developers might also fail to meet all provisions. This suggests that CBAs are not always as legally binding as proponents suggest. It is also not clear if positive outcomes such as higher wages and more affordable housing are attributable to CBAs. Like many contemporary neoliberal norms of development, this public-private partnership often equates inclusion with empowerment and community uplift with little regard to the actual power imbalance. CBAs engage communities in ways that are safe for developers and in keeping with neoliberal common sense. They “can achieve ‘value-conscious’ growth, but... do not fundamentally alter dominant standards of growth or growth machine processes.” Therefore, as a means of community-based development, CBAs provide legitimacy for capitalist development rather than an alternative.
An even more popular means of development to invoke community empowerment is inclusionary zoning or housing. This trend in development refers to “a range of local policies that tap the economic gains from rising real estate values to create affordable housing, tying the creation of homes for low- or moderate-income households to the construction of market-rate residential or commercial development.” Developers are required or encouraged to set aside a portion of housing for low-income residents to live near newly constructed market-rate housing and commercial development. Like the HOPE VI and Choice Neighborhoods programs, inclusionary zoning looks to address the housing needs of working-class communities via mixed-income development. As such, it also implicitly targets the concentration of poverty—rather than underlying inequities—as the source of neighborhood decline. With this logic, it is the positive influence and tax base of wealthier residents that saves communities. Inclusionary zoning is also intended to address the crisis of affordability felt across the US. However, its focus on new development does little for long-established communities stuck between devaluation and gentrification. Furthermore, because the construction of affordable housing is dependent on the construction of market rate and commercial development, inclusionary housing has often fallen short of providing adequate access to affordable housing. In his analysis of New York City’s Mandatory Inclusionary Housing program, Samuel Stein points to the fundamentally neoliberal character of inclusionary housing programs that invoke the economic stability and self-representation of marginalized communities while often offering only a “modicum of protection to the working class while safe-guarding the interests of capital and property.”
The development of the Turner Field neighborhoods in downtown Atlanta has relied on the assumption that a bustling consumer culture and the profitability that comes with it are legitimate and adequate means of community reinvestment. Georgia State University and private developer Carter—who together make up Panther Holdings LLC—assert that the proximity of profit will trickle down throughout the community. Despite the benevolent image developers have cultivated, several community organizations have fought to prevent looming gentrification. A central concer