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The Problem With ‘Smart Cities’

When I hear the term “smart cities,” I think of Fritz Lang’s dystopian film, Metropolis [1]. The 1927 classic portrays an Art Deco landscape of wealthy industrialists reigning from high-rise towers over masses of catacomb-dwelling uniformed workers who labor underground to keep the city’s huge turbine-driven machines humming. (If you’ve never seen it, it’s visually fantastic, especially with the new soundtrack.)

The builders of contemporary master-planned cities—the Middle East’s Dubai, Asia’s Songdo, or India’s Gurgaon—are smart in some sense. To be sure, these places draw on top talent in their architects, planners, and environmental consultants. They in turn create luxury districts where technology enables a gleaming and growing mix of oligopoly, exploitation, and surveillance.

These arrangements create stark contrasts. As architect Douglas Kelbaugh told [2] James Howard Kunstler, he spent two years in Dubai designing billion of dollars’ worth of “perfume bottle” (beautifully vapid) skyscrapers and abandoned urban projects the size of Manhattan Island—all while encountering daily the thousands of low-wage workers from India, Pakistan, Bangladesh, and China needed to create this immense Ponzi scheme of the most luxurious city-state on the planet.

But Dubai’s private buses full of mostly manual workers paid $5 a day are only superficially different from Songdo’s legions of programmers and developers: both groups are meant to be invisible and disposable elements in the workings of a neoliberal urbanism with endless ambitions to create a city-state which looks like—in Kunstler’s sardonic phrase—“yesterday’s tomorrow.”

A key aspect of the “smart cities” movement is the promise of personal technology to create new economic opportunities. But the fact is that no sharing actually goes on in most of what’s called the sharing economy—companies such as Uber, AirBnB, Lyft and TaskRabbit extract value from contract employees, not in the service of some dewy-eyed mutualistic scheme, but rather for the benefit of perfectly conventional Silicon Valley venture capitalists. The latter process is sometimes called “Uberization.”

It turns out that the sharing economy is mostly about exploitation of workers and earning yourself an enforced membership in the precariat, that mass of short-term (“flexible”) contract employees who now make up about 40 percent of the worldwide labor force.

These are people who live precariously with no guarantee of a job beyond the short-term, generally less than 40 hours of paid work per week, as well as no unions or industry regulation to speak of, given the dramatic disparity in bargaining power here. Where is this all going, we may well wonder.

To take only one set of dark projections, in Average Is Over [3], economist Tyler Cowen foresees a future in which a tiny meritocracy makes millions while the rest of us struggle on anywhere between $5,000 and $10,000 a year. It already works quite well in Mexico, Cowen quips.


If you happen to be a millennial or know one, then you’re probably familiar with the issues around digital work. But this economic threat to our democracy—the Internet as an inequality machine—is bigger than one generation. It’s in the process of overturning the traditional rights of workers going back to the 19th century. And it’s quickly scooping in oceans of our personal data—a form of personal property—in order to leverage that asset into creating even more value for the few owners of the digital platforms now driving a large proportion of our lives (Amazon, Facebook, Google, etc.).

Thus we see the rise of a new movement employing an old rallying cry: platform cooperativism, a marriage of the historic cooperative model of business and digital platforms aimed at bringing genuine democracy to the internet, especially in the form of distributed ownership. The urgent goal of these activists and entrepreneurs is nothing less than to reset the norms and culture of work.

What if Uber drivers set up their own platform, or if a city’s residents controlled their own version of Airbnb? How about if enough Twitter users got together to buy the company [4] in order to share its ownership?

The latter idea comes from Nathan Schneider, co-editor of one of the best guides to this emerging area Ours to Hack and To Own [5]. It’s a fascinating collection of not-all-that-techy articles on cooperative initiatives to resist the cooptation of the Internet.

Platform cooperativism is simply communal ownership (with roughly 170 years of cooperative movement history) brought together with today’s notions of democratic governance. The term platform, as the editors explain, “refers to places where we hang out, work, tinker and generate value after we switch on our phones or computers.”

Principles of cooperativism are well developed and plenty of impressive examples exist worldwide, from the Mondragon Corporation [6] in Spain (actually a network of coop enterprises employing over 74,000 people) to the dozens of consumer, agricultural and healthcare coops in Italy’s economically resilient Emiglia-Romagna [7] region. In this country, some 30,000 coops contribute an estimated $154 billion to our national income.

Further, coops—values-based businesses that operate for member benefit—have a lower failure rate than conventional businesses, are more likely to promote community growth (via local ownership), can have low startup costs, and help stabilize communities in their role as business anchors by multiplying local expertise and social capital.

We’re talking not about socialism but a form of capitalism—algorithmic capitalism—and how to create more capitalists, people who are genuinely owners. We’re also talking about formulating the first charter of workers’ rights for the growing but invisible digital labor force.

Another important topic addressed here—and a key part of “digital commoning”—is that of countering the corporate, surveillance-driven model of the smart city being promoted by big tech companies. Thus models of public ownership of civic data are needed in order to foster new forms of social innovation.

Notable contributors to this collection include Douglas Rushkoff (Throwing Rocks at the Google Bus [8]), Juliet Schor (Plenitude: the New Economics of True Wealth [9]), Yochai Benkler (Wealth of Networks [10]), Michel Bauwens (P2P Foundation [11]), Saskia Sassen (Expulsions: Brutality and Complexity in the Global Economy [12]), David Bollier (Think Like a Commoner [13]), and co-editor Trebor Scholz (Uberworked and Underpaid: How Workers are Disrupting the Digital Economy [14]).

(To follow developments in the platform cooperativism movement, I recommend the clearinghouse website [15] platformcoop.net, which is loaded with resources.)

Building cities that enable true human flourishing—and utilizing new technology to make it happen—is possible. But we must recognize the pitfalls of handing control to a few unaccountable companies. The city that can capitalize on platform cooperativism may yet outsmart the master planners.

Elias Crim is the founder of Solidarity Hall [16], a group blog focused on renewing civil society.

15 Comments (Open | Close)

15 Comments To "The Problem With ‘Smart Cities’"

#1 Comment By Fran Macadam On January 12, 2017 @ 9:07 pm

It’s interesting that Metropolis collapsed in a spiritual revolt that led to a crisis of conflict between good and evil, mostly among the workers, which wrested control from the elite planners, the head of whom was at least partly in league with the demonic and willing to sink to such collaboration to remain in power. The workers were for a time misled by a demon of chaos, nihilism and anarchy, masquerading as an apostle of workers’ rights. In the end, a scion of the elites, sympathetic to the workers, is moved by compassion and empathy to identify himself with the workers, partly through his transcendant love for their real leader, an angelic girl. The workers and the owners collaborate by means of the mediator that the son of Frederson becomes.

This film was made during the Weimar era in Germany, certainly a tumultuous time of political conflict, collapsing morality and increasing economic dislocation. What happened after Metropolis? The possible prophecy of Metropolis was unfulfilled, as German leadership lost credibility with the people, and could offer them no hope. Its director, Fritz Lang, fled to exile, its author and his former wife, Thea von Harbou, became a Nazi collaborator.

Perhaps modern Germany has better mirrored the film’s aspirations for cooperative industrialism. But now there are new instabilities threatening, brought on by the consequences of new pre-emptive wars, the same forces of aggression that bequeathed us both two world wars and the conflicts that have followed, along with the destabilization inherent in them that produces mass migration of refugees.

#2 Comment By Fran Macadam On January 12, 2017 @ 11:52 pm

The workers in Metropolis revolted against the machinery they worked on which also maintained the society of both elites and themselves, but by which they were also enslaved. The answer there was a fairer allocation of the fruits of their work, back to them, instead of the unfair allocation of anything beyond their subsistence to Metropolis’ one per cent.

The problem we workers now outside the one per cent is different. Yes, in the interim the elites sought to reduce their labor costs through arbitrage, by moving the work they need done to produce their own income to the lowest cost locales around the globe they could find, with workers in each area competing in a race to the bottom. This has mightily benefited wealthy elites, as all the gains of the supposed post crash recovery have gone exclusively to them, which means the rest remain in reduced circumstances. The power ratio increased wealth brings creates even more disadvantage, both financially and in the consequence of reduced political power that money buys.

We ought to return the labor benefits of domestic production back, and that can’t occur unless actual manufacturing returns here. The problem is the one that the globalist enthusiasts in Washington like to recite to us: even if production comes back, you won’t be getting any jobs or financial benefit anyhow, as we’re not going to employ you. Thus, the argument goes, Trump ( or any other populist) cannot help you, because if we are forced to produce here, we will use robots instead of you. Therefore, since a Trump figure cannot help and the very thought is deluded, rather than try to wreck the globalist project and plunge the status quo financial system into chaos – a threatening disestablishment of the “international order” – continue to support technocratic elite governance. Vote Hillary or one of the 16 other Republican Presidential nominees. Sucks to be you, but not favoring the Wall Street would be even worse for elites, not just you millions of deplorables in flyover country.

Is the purpose of globalism a win-win program for people in each nation state competing for elite favor, or as practiced in reality by elites as a zero-sum game to be rigged in their favor against everyone else, in a kind of “Crony Capitalists of the World Unite” conspiracy? It clearly appears so, judging by the leaked articles of the transnational giant trade deals, which abolish the democratic accountability inherent in each nation-state, with that of a controlling supranational corporate oligarchy neither responsible to or accountable to other than themselves. That is quite a coup.

It is plain that the decisions of how each human life to be lived, and the practical purpose to which each life is put, are not to be decided democratically through free discussion and debate within nations with the policy choices decided upon by the peeople themselves. The decisions that the transnationalists have decided upon is that as an elite meritocracy sufficiently populated by elites from the right proportion of ethnicities – and therefore satisfying progressive identity politics instead of truly being accountable to entire populations of any ethnicity – they are self-entitled to wrest away power from those who “make the wrong decisions” in elections, the people themselves. This is supposed to make them immune from the practical consequences of public opinion, when it can no longer be controlled by manipulation, when millions of human beings find themselves surplus and not needed, and without the means to support their families or ordinary human community, because they have become irrelevant to the automated revenue producing economy designed by and for elites.

#3 Comment By Will Kemp On January 13, 2017 @ 3:09 am

Songdo is in Korea…

#4 Comment By The Colonel On January 13, 2017 @ 10:02 am

“We’re talking not about socialism but a form of capitalism—algorithmic capitalism—and how to create more capitalists, people who are genuinely owners. We’re also talking about formulating the first charter of workers’ rights for the growing but invisible digital labor force.”

excellent. it’s high time that we step away from the tired, Tourettes-like arguments over false dichotomies and consider paths forward that make more of us active agents in a more broadly constructive marketplace and community.

#5 Comment By BradD On January 13, 2017 @ 10:08 am

I remember the transition quite well, even if I don’t remember the timing exactly. At one point they referred to Uber and AirBnb as a new ‘sharing’ economy. However, at some point, the term went by the wayside and now it was a ‘gig’ economy. Sharing implies an equal sharing cooperative and gig implies a short term job.

The original idea of Uber and the like were great. I own this thing (car, house, etc) and don’t use it 24/7. Personally, my car is probably parked 95% of the day. So, since I have this thing but don’t use it that often, why not share it? The idea of Uber and the thrust of self driving cars is that cars are empty and parked the majority of their life. Why not utilize an underused resource?

However, that quickly changed. Uber was no longer a sharing model, or even a short of “hey, I’m free today or need a few bucks. let’s pick some people up”. Now it is a full time job, albeit one with no benefits or guarantees.

#6 Comment By hankest On January 13, 2017 @ 12:05 pm

I’m a NYer and you’ve hit on one of my favorite pet peeves. The sharing economy is a joke. it’s simply a system to hoover money from small NYC businesses into the pockets of a handful of west coast millionaires.

Uber’s doing nothing new, it’s a car service. Used to be you got on the phone called you’re favorite: “Diga me?” “Hey i’m on President and 5th” “ok, 5 minutes.” Done.

What’s new, aside from the fact that you don’t have to speak with anyone, is they’re spending billions to monopolize the entire car service industry. If they succeed they will put 100s of NYC tax paying small mom and pops out of business in the process. And all of a sudden they’ll control the prices completely, while giving riders and drivers no choice.

But even worse is Seamless. They take 15% to 20% right off the top of your order. Meaning the $15 pizza you ordered now gets the small neighborhood shop only $12.75 a big hit to their pretty sharp profit margin. it’s a racket. Nothing more.

That said, i don’t think your solution would work. The best solution would be a city run cab flagging app and a city owned run app to order food. Socialism? Yeah maybe, so what?

#7 Comment By Dylan Sweeney On January 13, 2017 @ 1:07 pm

Songdo is in Korea, not China.

#8 Comment By grumpy realist On January 13, 2017 @ 3:41 pm

What we also need to do is make it much easier for people to have a decent, albeit frugal life through their own production of food and clothing even if they don’t have one of those things called “jobs.”

Victory Gardens for all!

#9 Comment By EngineerScotty On January 13, 2017 @ 6:22 pm

A big point of Uber and kin is regulatory arbitrage–by posing as a large collective of part-time amateurs, these companies hope to escape the regulations that apply to competing professionals. An AirBnB claims not to be subject to laws and regulations which govern the business of hotels, Uber claims its drivers are not taxis, etc.

And in some cases, this isn’t a bad thing–uber is popular simply because many taxicab regulatory regimes reward medallion-holders at the expense of both the drivers (who generally aren’t the medallion-holders) and the public.

But other taxicab regulations–ensuring (or trying to ensure) uniform fares, safe and sanitary conditions, and universal service (a regulated taxi cannot refuse a fare just because it’s in a “bad neighborhood”, but Uber drivers frequently do so), are in the public’s interest. The cities in which Uber has been the most successful are those with horrible cab service–particularly where Uber can convince its clientele to pressure the authorities into abandoning their longstanding deference to the local taxi cartels.

But not all taxi regs are bad.

#10 Comment By Harold Helbock On January 13, 2017 @ 9:00 pm

“What if Uber drivers set up their own platform, or if a city’s residents controlled their own version of Airbnb? How about if enough Twitter users got together to buy the company in order to share its ownership?”

Then union bosses would be the bad guys and do their usual by scalping the workers. You see the right problem but have no answer.

#11 Comment By Winston On January 15, 2017 @ 1:27 am

Gurgaon is environmental disaster. Smart city just a way to get dumb money from hackable services and also services needing constant upgrades. Dubai is RE bubble because main business is money laundering

#12 Comment By Vlad the Skewerer On January 15, 2017 @ 8:00 am

A worldwide multi billion dollar revenue stream trafficking in my personal information and I dont get a cut is my complaint. Where’s my royalty check bitches!

#13 Comment By c matt On January 16, 2017 @ 11:08 am

McAdams’ suggestions sound similar to distributism.

#14 Comment By Karl Keating On January 16, 2017 @ 10:56 pm

EngineerScotty: “But not all taxi regs are bad.” Maybe not, but then it seems that those good regs are ineffective.

In San Diego–hardly a rustbelt city–my experience with cabs has been, on the whole, unhappy. Vehicles are not particularly clean, most drivers barely speak English and usually aren’t friendly, and I almost always have to give them turn-by-turn directions from the airport to my home.

I have yet to have a bad Uber ride. The cars are clean, the drivers are friendly, they know how to get to the destination (GPS, of course), and the fare is only half that of the cabs.

So, yeah, I’ll accept that there are good regulations. It just seems that no one has bothered to put them into effect.

#15 Comment By Brian On January 20, 2017 @ 2:30 pm

Seems like Uber like things actually work in the drivers favor to me. The whole company relationship is just an app on your phone…if Uber is taking too big a cut someone new will come along and offer better terms. And there’s virtually zero cost or risk to the driver to switching to that new company. Being an independent contractor they probably can’t prevent you from working for multiple companies simultaneously if you wanted to so you don’t even have to quit Uber to try out the new guy.

Seems like the fundamental problem is anyone can be a driver, many people are probably very optimistic about what running a car commercially actually costs, and so the fares don’t amount to a big salary. But that’s not going to change if the contractors were also shareholders in an Uber like company. They only recently became profitable in the US and at least from articles I can find online Uber only make about 19 cents per ride