Capitalism, City, Apartheid in the Twenty First Century

The last 30 years of capitalist development have, especially in what used to be called the advanced capitalist countries, generated paradoxical, if not contradictory trends. The “great crisis” (Galbraith, xi) of 2008 was rooted in an ideological failure. Marching under the banner of free markets, writes John Kenneth Galbraith, the state permitted the globalization of finance; the unrestrained growth of financial derivates, tax havens, regulatory arbitrage and the carry trades (Galbraith, xii). In short state authortities in the USA, in the UK and elsewhere acted as if the market really was a self-regulating mechanism functioning according to natural laws (see Paul Krugman, 2009). The result was the first full-fledged credit collapse and debt deflation since 1930. At the very moment that governments in the West were treating markets as quasi-natural (quasi-religious) systems, capitalist firms themselves were often moving in a different direction. Luc Boltanski and Eve Chiapello have documented how in France, in particular, from the 1970’s large corporations took on-board the anti-capitalist critique of alienation and bureaucracy that was associated with the events of 1968 to develop new models of management and work-place organisation. The paradox is often not sufficiently noted. This paper argues that there was another, no less remarkable, shift in capitalism. During the 1970’s, but especially from the 1980’s, the bundle of rights associated with private property mutated in many countries to accommodate historically non-capitalist modes of social organisation.