Harvey's Urbanization of Capital
As a part of our Harvey at 90 series, Richard A. Walker explores The Urbanization of Capital
The Urbanization of Capital is a pivotal book in David Harvey's career, along with its twin, Consciousness and the Urban Experience. Published at the same time they are collections of (mostly) previous essays in which Harvey was working out his ideas about the geographic theory of capitalism during the 1970s and early 1980s. Of course, Limits to Capital was Harvey's foundational work, and he has never stopped elaborating on Marx's theory of capital or on the idea of "historical geographic capitalism". This has made him the finest exponent (and teacher) of Marxist economic and spatial theory of the last fifty years, as well as the most esteemed geographer of his time.
Urbanization of Capital captures a key moment in the revolution that Harvey achieved by opening up Marxism to spatial theory and taking seriously the study of cities as essential building blocks of capitalist economies and societies. Urbanization is not a fully unified book or theory of capital and space (nor was Consciousnessan adequately developed study of urban culture). These were assemblages of work in progress. But Urbanization coheres quite well, bookended by an opening theory chapter and closing historic survey chapter. Harvey is not only a great theorist but a very good writer, so the central model of the urban process under capitalism can be easily summarized because it is so clearly laid out.
Capital accumulation necessarily generates excess surpluses (overaccumulation) that must be channeled into fixed investments in the long-lasting, material structures and infrastructures of the built environment. That is, capitalism necessarily creates cities and other landscapes. Those arise (literally take place) in particular times, places and shapes. For Harvey, "the production of space" is an integral part of the unfolding of capitalism over time; space and time cannot be severed. Furthermore, investment in fixed capital and built environments requires the development of sophisticated finance to supply the credit for the highly speculative process of long-term investment in urban systems.
Cities (concentrated places) are vital because of their role in production (agglomeration economies, labor markets) and consumption (a consumption fund for effective demand and labor reproduction). The built environment in any period must be suitable to its function of advancing capitalist production, consumption and accumulation. But urban places can become barriers to the change essential to capitalist competitive innovation and must, therefore, be periodically reshaped to fit new conditions – or left behind to build new locales more suitable. Capital tries to balance the old and new but inevitably crises break out, and these are well marked in the history of modern cities by repeated construction cycles. The urban system must also succeed in class reproduction and damping down class struggle that could disrupt the spiral of accumulation and urban growth.
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Harvey elaborates on additional aspects of the urban process central to debates at the time in urban studies (geography, sociology, planning). He explores rent theory and the extraction of surplus from the urban system via rent; explains residential differentiation in terms of class fragmentation and self-interest; does a take on the practical (versus ideological) basis of city planning; and presents a model of urban politics as the formation of coalitions for inter-place competition and growth. In the last chapter, Harvey presents a sweeping history of capitalist cities from the eighteenth to late twentieth centuries, in which the central theme is how urban spaces have fit the needs of capital in each major epoch.
Like any book, Urbanization of Capital reflects its time. Harvey engages with and counters key voices on the left about how capitalism and cities operate. He confirms Lefebvre's idea of the centrality of cities to capitalism but gives it a sturdier foundation. He combats the ideas of Castells that urban social movements have little to do with class struggle and that cities are sites of consumption but not production. And he opposes Mollenkopf's belief that urban politics and the state are forces outside the capitalist economy.
Harvey's location in time and in space (Baltimore) had much to do with the themes he takes up, such as rent, the landlord class and residential differentiation (and racial segregation); the function of postwar suburbanization as a solution to the mid-century crisis of the Great Depression; and interurban competition as illustrated by Baltimore's Harbor Place redevelopment. These themes can seem dated now because of the yawning chasm opened by the tectonic economic and geographic shifts since that time.
How radically cities, the country and the world have changed over the last forty years! For example, Harvey's chapter on urban politics is set in a relatively closed national context of civic competition for capital investment that carries no hints of the upheavals to come with sweeping deindustrialization, globalization, megapolitan dominance, neoliberalism, the tech revolution and more. Harvey has, of course, written on many of the phenomena that have arisen since this book was cast in type, much of it brilliantly: neoliberalism, the rise of China, new cityscapes, financial schemes of the 2000s, and more.
Re-reading Urbanization of Capital today means putting all that aside in order to distill the insights that still ring true. Above all, the book puts capital's imperative to innovate and disrupt at the heart of the argument, along with the inevitable financial crises and urban revolutions that result. The theory is timeless in making clear that none of the shocks to the old economic-geographic order should come as a surprise. Any urbanist worth their salt sees this all the time; it is always and everywhere written in the urban fabric, whether past upheavals frozen in stone or new rounds of tearing down and building up of the built environment. Indeed, those wholesale acts of creative destruction in cities (or, more appropriately, destructive creation) can be so sudden and vast as to shake one's sense of reality. Capital loves to gaslight us all.
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The financial crisis of 2007-08, the greatest since 1929-33, was almost entirely about housing and was a perfect vindication of Harvey's theory offered a quarter century earlier. Yet, economists, journalists, politicians and public intellectuals are forever dumbfounded by such events, attributing them to everything but capital accumulation. The state where I live, California, was the heart of the subprime mortgage meltdown in the United States (just as Spain was in Europe); yet, that event was treated as if it had no geography other than "Wall Street" (Walker 2010).
My city, the San Francisco Bay Area, had earlier been the epicenter of the dot-com implosion, while most other places were less impacted (Walker 2006). Then, following the mortgage crisis in the 2010s, the Bay Area experienced one of the epic urban growth booms in capitalist history, driven by the region's role as the premier agglomeration and headquarters cluster of the global tech industry. That boom generated the highest average incomes and one of the least affordable housing markets in any major urban region in the world, as well as the ripping and tearing of the urban fabric to build office, apartment high-rises and outer realms of the metropolis (Walker 2018). The urban region then went into a nosedive in the 2020s, leaving the city centers of the region with almost half their office space vacant, tens of thousands of workers departed, and retail gutted.
Yet, the vast civic earthquake of the era has been largely incomprehensible to our local pundits. We only heard cheering during the boom, whatever the cost, and blame for the bust (or supposed "death spiral") put on the pandemic, remote work and the failure of liberal policies. Meanwhile, the housing crisis is never seen as due to boomtimes, excess profits and upper-class incomes driving demand; it is always the fault of supply shortage due to overregulation and bad governance. Tech titans, real estate speculators and capitalism get off scot-free.
Admittedly, Harvey's theory of "the urban process under capitalism" is cast at a high level of abstraction which can be difficult to ground in convincing empirical studies. I have seen far too many articles throwing around the concept of "the spatial fix" (from Limits to Capital but less used in Urbanization of Capital) without any sense of the full model behind that catchy term. Yet, Harvey has always been a theorist who worked up his ideas from an immense knowledge of history and familiarity with the urban process, as proven in what I regard as his finest piece of writing, Paris: Capital of the 19th Century. That brilliant work, prefigured in the essay on Sacre-Coeur in Consciousness and the Urban Experience, is Harvey's 18th Brumaire, and as with Marx provides another way into the head of a man of genius.
I was there at the origin of David's explorations of Marx's Capital and the theory of the production of space at the Department of Geography and Environmental Engineering at Johns Hopkins University. Reading this book again takes me back to my academic origins and the great fun we had learning together with Gene Mumy, Ric Pfeffer, Carolyn Hoch and other comrades. It also reminds me of all that I owe David – albeit with a small gift exchange from my dissertation on suburbanization – and what a generous mentor he was (exemplified by a most gracious inscription that I just rediscovered inside the cover of my copy of TheUrbanization of Capital). I, like many others such as Neil Smith and Erica Schoenberger, continued working from the foundation the David provided us back in those days. And I think that some of it was successfully passed along to a next generation of our Marxist-inflected graduate students. Of course, much else has occurred in urban studies that complements and conflicts with David's theories, but one can still do a lot with those "good bones".
What I especially enjoyed from re-reading Urbanization of Capital is recapturing the excitement of the time and the sense of possibility unleashed by David's rejuvenation Marxist theory in a way that included cities and space. I well remember attending a spell-binding lecture by David elaborating on his brand-new theory of urbanization at an early-1980s conference at UC Santa Cruz, an intellectually dazzling gathering of leftist urbanists that included Henri Lefebvre, Frederick Jameson, Ed Soja, John Friedmann, and Delores Hayden. As with all of David's mesmerizing lectures, he never used notes and never skipped a beat. (He always wrote most of his essays in one go, with very little revision).
I also remember the way Marx was shouldered aside in the 1980s and 1990s by the next wave of academic fashion – post-structuralism, postmodernism, gender and queer theory, etc. – which condemned Marxism as reductionist, economistic, patriarchal or worse. Of course, we all learned a great deal from those debates, some of which had to happen within and without Marxism; but political economy suffered as cultural theory triumphed. Happily, spatial theory caught on across the disciplines at that time and geography became a more serious endeavor in the United States. When Marxism made a comeback in the 2000s in the aftermath of the Gulf War and the Great Recession, the world had entered a darker time in which my youthful enthusiasm for high theory had receded. Nevertheless, I still believe that a supple, sophisticated and inter-disciplinary Marxism like David Harvey's is still very much needed, and the construction of a fully historical geographical materialism must go on.
