This book addresses what, on the face of it, seems a straightforward question: who is governing London and how? Similar questions are being asked in cities and societies across the world in an era that is shaped by relentless processes of globalization, multiple crises and insecurities. The book is therefore an assessment of the governance arrangements that shape the city's planning and development, who controls them and whose interests they serve (and whose they do not). We show that over recent decades there has been a slow but steady corrosion of the public realm, in which powers, resources and responsibilities have been voluntarily ceded to a range of players at multiple scales, found mainly in the private sector. There is a lot to be learned from London. It is a context in which there has been a deliberate and purposeful agenda to generate dependency on private finance and service providers. All planning deliberations and political choices are now conducted in the shadow of the market, with an eye to what these new groups of players – what we term the parastate – want and need. There is nothing inevitable about what has happened. We begin by setting out the “simple story” that dominates policy and (some) academic thinking about London before turning to some of the wider difficulties that policymakers, businesses and citizens increasingly face in the wake of decades of change.

London's simple story: from the city of decline to the triumphant city

During the 2000s many hailed London's economic and demographic expansion as an archetype of a broader narrative of urban triumphalism. For a range of commentators, politicians, academics and planners its recent experiences can be captured in a simple story of change that explains the much- lauded transformation from an earlier period of structural decline. The story begins with a view of its imperial past that acted as a driver of growth in the early modern and industrial eras but left the city ill- suited to the demands of post-war economic and social change. Its urban environments were characterized by poorly planned and maintained infrastructure, with dilapidated housing and commercial property stock and a misfunctioning post war welfare state that had been responsible for the delivery of poor- quality modernist estates and declining private sector dynamism.

London is a city with a long history of radical locally based social movements involved in battles against specific schemes or the activities of public organizations (Ashe, Virdee & Brown 2016; Rosenberg 2015). However, as outlined in Chapters 2 and 3, civil society and community groups in the contemporary city have found themselves caught up in sweeping changes to state systems, modes of political representation and the transformation of urban environments.

It is no longer only local government, public agencies and politicians that are the targets of protest. Instead, the focus has returned to addressing basic questions around what is governed and who is governing, such as: how can and should community groups organize themselves politically in a context in which much of the social infrastructure of places is owned, financed and managed by private actors, working through professionally mediated contracts? And in a city in which the public sector's role and influence has been corroded, where should the focus of political action and campaigns be targeted? Moreover, how can parastate actors be identified and made accountable for their actions when they are operating under contracts and deliberations are subject to strict rules around commercial confidentiality? Under contemporary governance conditions, it is not always clear, even to those working in the public sector or parastate agencies, where their expertise and/or organization fits within wider arrangements.

This chapter discusses the political and regulatory landscapes in which civil society groups and social movements now operate. It develops the discussion in three parts. First, it examines the continued relevance and importance of representative political structures in the city. While narratives of urban political change have focused less on “outdated” representative structures (Du Gay & Lopdrup- Hjorth 2016), in London they continue to have significance. The London boroughs are still key players in shaping modes of representation and authority. Later chapters on housing and tall buildings show that there are significant variations in their approaches to planning and development, and the extent to which they address resident/community politics. However, it is also clear that borough level regulation is increasingly inadequate for deal-ing with the challenges of coordination raised by the growth of the parastate and contemporary forms of community representation and need.

London's skyline changed radically during the 2000s. In this respect it has much in common with megacities around the world in which the expansion of tall buildings, both for residential and commercial use, has become a defining feature of twenty- first- century urban growth. By 2019, London already had 360 blocks of 20 storeys or more, with a further 510 schemes in the planning pipeline (New London Architecture 2019). Ninety per cent of these are residential (CTBUH 2021), with investors increasingly drawn to the potential profits that housing can make.

However, few planning issues have proved more divisive and London's discretionary and opportunity- based territorial planning system has consistently struggled to provide a coherent strategic overview of how and where such buildings should be placed, and what purposes they should serve. For advocates of a London model their presence is symbolic of the city's openness, pre- eminence and expansion. In more practical terms they provide new commercial and residential spaces that enable the economy and population to grow within a relatively constrained urban environment. Perhaps most significantly they are presented by London model advocates as being representative of future vision for megacities, with claims made that London's planners have much to learn from growing metropolises across the world – notably iconic cities like Dubai and Shanghai – in which tall buildings now dominate urban development.

And yet for critics, their construction is both functionally and aesthetically damaging to London. They decry such forms of development as piecemeal and corrosive of the city's traditional urban landscapes. In the face of new forms of finance and mega- scale proposals, planners, policymakers and citizens have found that established planning regulations are increasingly inadequate and unable to exert control over developers and investors.

In the words of the pressure group the Skyline Campaign (2014: 1) “this fundamental transformation is taking place with a shocking lack of public awareness, consultation or debate. Planning and political systems are proving inadequate to protect the valued qualities of London, or to provide a coherent and positive vision for the future skyline.” Others such as Transparency International (2020) have undertaken powerful in- depth studies of how London's deal- based planning system opens up opportunities for corrupt practices, especially in permissions over tall buildings.

In this chapter we address how a London model of development limits the capacity of both the planning system and the market to provide adequate housing. The topic has come to dominate wider debates over the politics of planning to such an extent that for many citizens and groups it is what planning is concerned with.

Much of what has taken place in recent years was unimagined in the 1990s when organizations such as the LPAC saw a global growth model as being primarily about economic and commercial development. It was imagined that the city's planning system should facilitate growth and that there would be a moderate increase in population as workers were attracted to new employment opportunities. However, as we have seen in earlier chapters, the scale of demographic change eclipsed what was predicted. Allied to this was a growing financialization of housing in national and international markets. A combination of these factors generated a housing crisis that is more intense and extreme than that found in almost any comparable city in the world.

As we will see in this chapter, a large part of the problem relates to who is governing housing and how. In line with broader changes, private developers now largely provide housing, with the vast majority built by big volume house builders, most notably by Barrett and Berkley Homes. Local authorities traditionally provided affordable housing, a contested term (discussed below), but more recently responsibility has been transferred to private developers and not- for- profit housing associations and other agencies subsidized by state funds. These have been further supplemented, since 2012, by the creation of arms- length local housing companies, which are owned solely by local authorities but are able to leverage private capital. The most significant examples of these agencies are listed in Table 6.1.

We begin by outlining the state of private housing markets – both owner-occupied and rental – and the extent of London's housing crisis. In particular, we grapple with how the roll- out of supply- stimulating policies and incremental changes to tenant rights have had only a minimal impact in tackling hous-ing needs and have often made matters worse.

Much of the writing on governance arrangements in London starts with the common- sense assumption that power and responsibilities lie with formal organizations, and that governance practices reflect how powers and resources are distributed between these organizations (Gordon 2018; Travers 2002). Discussions tend to focus on public/private partnerships and/or the networks of actors operating in different sectors, but still working within a clearly defined public sector context, which is taken to be relatively open and subject to systematic analysis.

Such approaches assume that formal actors, operating through hierarchies or command- based structures, use “imperative coordination in pursuit of substantive collective goals set from above … [and] prioritise the effective pursuit of successful policy goals” (Jessop 2016: 167). In other words, the process of policymaking is still thought to operate within traditional organizational structures; that is, policymakers establish objectives and programmes of action, such as the London Plans discussed in Chapter 2, these are delivered by executive arms of the state incorporating a range of actors and, while at times delivery is coordinated through networks with private or voluntary sector groups, the primary responsibility for public policy rests with governments.

This common- sense approach fails to recognize the structural shifts that have occurred in the organization and management of the state itself and how these directly impact the governance of megacities. As noted in Chapter 1, the London model is driven by priorities that increasingly rely on private sector resources, legal codes and knowledge practices. In a growing number of policy fields, what were formally state- run activities are now conducted, managed and delivered by private companies and the range of professional organizations that shape their conduct, in line with nationally and internationally recognized norms and rules.

This is happening on an unprecedented scale, to the extent that it is increasingly unclear who is governing and what is governed, and for what purpose. Critical writers have highlighted the expanding role of the private sector in the delivery of urban projects or in forming alliances with public sector elites. However, the context we describe is one of a more structural set of interactions in which some of the separations between the public and private sectors have effectively dissolved away.

The book started with a simple question – who is governing London and how? While much of the writing on megacities limits itself to formal policymaking structures, we have argued that a closer examination of these wider governance questions should be at the heart of any analysis (Le Gales & Vitale 2013). The chapters have charted structural shifts in the organization and management of the state. What were formally state- run activities are now conducted, managed and delivered by a panoply of private sector companies, professional organizations and parastate actors. Private law codes, mobilized at multiple scales, shape the business of megacity governance in unprecedented and underanalysed ways. Elite lobbyists and interests battle for attention and influence. The result is that there is both a crisis emerging in the delivery capacities of policy systems and their accountability and manageability.

It is increasingly unclear who is governing and what is governed in the common- sense understandings of the terms. And while for decades critical writers have focused on the growing role of the private sector in the delivery of urban projects, and in forming regimes and alliances with public sector elites, the context we describe is one of a more structural set of changes in which some of the separations between the public and private sectors have become more porous.

In this final chapter we highlight some of the inbuilt vulnerabilities of the London model and the structural risks that it now faces. First, we highlight the growing significance of the climate emergency and the capacity of the city's governance arrangements to develop the strategies and interventions necessary for building resilient urban environments. As with all aspects of the model, much of the longer- term planning and investment is being left to the private sector and parastate organizations to deliver and coordinate. No issue better reflects the structural problems of governability brought about by decades of reform.

Second, we highlight some of the impacts of Brexit on London's planning and development and the risks it poses to the growth models and certainties embedded in London Plans since the turn of the millennium.

In this chapter we analyse new forms of funding and financing of the London model and what they mean for governing the city. As noted in Chapter 1, the model itself emerged partly in response to the presence of global and national finance seeking out new opportunities in urban property markets. But as Özogul and Tasan- Kok (2020) argue, when seeking to understand investors and developers it is necessary to unpack the diversity of practices and approaches they employ and the ways in which they navigate the complexity of places and planning systems. Specifically, we look at the rise of patient capital by examining four types of investor: pension funds, sovereign wealth funds (SWFs), property- specific real estate investment trusts (REITs) and then address more predatory forms of finance. We highlight how these newly significant investors have transformed the relationships between the public and private sectors.

The growth of new forms of funding and finance has come hand in hand with the rise of development by project mentalities. Boroughs and the mayors’ executive bodies increasingly view the pursuit of projects as a means of generating financial autonomy in a context of budget cuts from national government and the constant shrinkage of locally determined regulatory powers and responsibilities. In this way, the ideological work of the London model manifests in how the visible presence of projects is presented as a win- win form of planning through which the city's residents and businesses benefit from new growth, in terms of jobs and economic opportunities, while at the same time meeting social and environmental objectives. Growth also creates the funds to introduce better designed and more sustainable urban built environments, often delivered by private sector consultants and experts.

However, we show that far from generating financial autonomy for government bodies or signalling a wider renaissance in localism within London, the shift towards project- led planning has taken the mechanisms of competition and insecurity that exist within financial markets and internalized them directly into the functioning of the public sector. The analysis of these new investment landscapes and actors, and in particular the types of assets they are looking for, demonstrates the limitations of planning and the need for a more holistic approach to urban management that is capable of attending to a diversity of opinions and approaches and therefore is able to regulate this heterogeneity.

Whose property is it?

The historiography of Turkey is beset by contrasting themes of Oriental backwardness and Western modernism. Huri Islamoğlu (2012) argues for a less value-laden approach, using Marshall G. S. Hodgson's “unity of history”, without superimposing the question of which states were modern and which were not. Distinctions between East and West, centre and periphery and domination and subordination in the international order should be expunged. Instead, she argues, we should observe how states developed institutional responses to concrete questions such as property rights.

Comparative political economy offers this opportunity. Turkey represents an excellent case study of how real property rights affect regime support, because urban land is central to the political and economic calculus of politicians and the population alike.

Until the 2016 attempted coup Turkey had teetered along as an emerging economy and an emerging democracy. As of 2021 it has settled into an uneasy equilibrium as a neoliberal authoritarian state, often cast as a cousin of Russia. More accurately, it was a Soviet counterpoint during the Cold War, when anticommunism linked to secularism and nationalism defined the political elite and economy.

The competing worldviews of democratic and authoritarian states will define global politics in the twenty-first century. In December 2021 US president Joe Biden threw down the gauntlet in an international democracy summit he hosted to spur action against authoritarianism and rejuvenate democratic institutions, notably at home as well as abroad. It is an upbeat effort to reverse the dispiriting decline of democracy, which had triumphed when communism collapsed in 1989– 91. Ironically, the capital that claimed victory against an evil empire three decades earlier had to extol the continuing value of democracy. And the call for rejuvenation came in the same capital from the very president whose affirmation of victory was threatened when angry protesters stormed the US Capitol in January 2021.

How democratic and authoritarian polities differ on essential philosophical questions is not at issue. The agenda to protect human rights and reduce pernicious corruption in authoritarian regimes is salient for voters in liberal democracies. Actions to implement the agenda are also viewed positively, such as the appointment of a Coordinator for Global Anti-Corruption in the US Department of State and the closing of loopholes for money-laundering in the real estate sector. Yet the debate is silent on reasons for citizen support of authoritarian leaders.

Why does the property-owning middle class, which was a primary historical ingredient of democracy in the West, not push back against authoritarianism in Russia, Turkey and China, where private real property is prevalent? Why do real property rights produce economic but not political benefits?

This book examines these questions in Europe and Eurasia and uncovers a new variation on politics and property ownership. So long as average citizens can acquire real property rights that provide a long-term store of wealth, while governments reduce bribery and hassles in their real estate transactions, they are willing to overlook grand property corruption by elites and their limited voice in the political realm of life. But, when those hard-won rights are ambiguous or abused, or if the value of property or the urban landscape is marred by elite enrichment or environmental degradation, the social contract underpinning authoritarian legitimacy begins to fray.

The issue that policy-makers are missing in the democracy versus authoritarian debate is the political and economic power of real property rights.

Cities are the pulse of nations. The greatest among them – London, Paris, New York, to name a few – have long captured the imagination of historians, novelists and travellers. Yet the importance of cities as global actors and their centrality in shaping human affairs has ebbed and flowed over the centuries, along with their fortunes. Venice, the centre of Mediterranean commerce for hundreds of years, faded into a tourist haven; Lisbon, once the capital of world voyagers, lost its leadership after the 1755 earthquake; Florence, the birthplace of the Western Enlightenment, evolved into a picturesque provincial city. In more recent times Detroit, the “Motor City” capital, has been struggling to reinvent itself, like many other manufacturing rust belt cities. Others have been destroyed by war or fire, such as Berlin (1618– 48, 1945), Moscow (1571, 1611, 1812), Istanbul (1569, 1660), Tokyo (1657, 1945), London (1660) and Chicago (1871). Yet they recovered, and now thrive as twenty-first-century metropolises.

This book is about the fortunes of cities, told not from the standpoint of calamities or commerce or culture but from the shaping and moulding of urban land through the social convention of property rights. How does an invisible, intangible force over physical space affect urban life? And why should we care?

The short answer is that the way major cities govern land is a barometer of the economic and political health of any state. Governance rests on real property rights, which define the legal framework for control and use of real estate (land and buildings). As a source of wealth and power, urban real estate is an arena ripe for contestation.

Why are some cities successful and vibrant, when others are not? How does land governance fit into this dynamic? This chapter explores these questions from historical, economic and institutional perspectives. It begins by recounting the rise of global cities from anonymity to stardom.

States in the limelight

As of 2020, cities generated 80 per cent of the planet's wealth and housed half its people. They are global players, increasingly leading in world governance (Eden Strategy Institute 2018). Yet, until the turn of the twenty-first century, they were nearly invisible in many academic disciplines.

As the driver of world politics and trade, sovereign states held primacy as the unit of analysis for political science, economics and business. Political scientists compared states on dimensions of military power or political systems; economists on welfare or gross domestic product (GDP); business schools on innovation or competitiveness. Interdisciplinary fields such as international political economy (IPE) and comparative political economy (CPE), which emerged following the liberalization policies of US president Ronald Reagan and British prime minister Margaret Thatcher in the 1980s, analysed theinteraction of globalization with states or firms, but not cities. Because neither discipline considered the two-way causality of international capital flows and domestic housing markets, they missed the rising macroeconomic vulnerabilities exposed by household mortgage defaults, which sparked the 2007– 08 global financial crisis. Fuller (2019) correctly argues that both disciplines should take greater cognizance of the international macroeconomic impact of households as consumers of property debt, not just as workers. His point pertains equally to the success and vibrancy of cities as real property becomes increasingly commodified internationally.

The academic focus on states carried over into international institutions. Organizations such as the United Nations, World Bank and OECD, which are constituted by and for national governments, naturally devoted their efforts to state policies and practices. At the subnational level, rural regions carried higher weight as a development priority considering their concentration of global poverty.

Urban revolutions are institutional and spatial

Warning to national governments: urban centres are political cauldrons. If “Petrograd achieved the February Revolution”, as Trotsky said, giving birth to a system that survived seven decades, “then it died in similar locations” (Harloe 1996: 1).

Communism and capitalism both came to the USSR and CEE through capital cities, offering an unprecedented opportunity to study the interactionbetween national and urban political economy. Although institutional responses varied in the transition of each country, one unexpected discovery appeared. Communism did not just destroy markets. It recast the shape of cities, and, with it, their productivity as primary engines of growth. Not only did socialist cities appear in unlikely locations, with Russia an extreme example, but the location of economic activities within cities also changed as density shifted to the periphery. Political ideology and the central state, not individual initiative, powered the urban economy.

To analyse the unwinding of this long legacy, the challenge is neither to oversimplify (Harloe 1996: 2) nor to overlook the broader context of global forces during the transition (Sharafutdinova 2021: 1). Along with institutions, ideas are potent travellers, and the timing of the collapse of the Soviet Union and the Washington Consensus, which trumpeted a neoliberal economic reform agenda, is highly relevant in terms of national choices on privatization and deregulation.

After the Berlin Wall fell in 1989, a debate raged between radical reformers and gradualists about the pace of market transition. The privatization of real estate, as a high-value asset, was a contentious and protracted process (Åslund 2007).