This shortish piece, titled "What Happens When the Richest U.S. Cities Turn to the World?," provides a small snapshot of the modern global economy — but I found it sharpening my perspective unexpectedly. Its starting basic point is that several decades ago, large U.S. cities often had manufacturing as a major industry that in turn drove business in smaller, often more inland U.S. cities. However, our current economy sees a trend in which huge cities like New York and Los Angeles often have closer economic interconnections with similarly-sized megalopolises abroad like Tokyo and New Delhi than with smaller American cities or even regions in their own states.
This probably sounds to most readers like a basic, high-level description of globalization — and I think it is — but something about the granularity of the article's details helped make globalization just a little less abstract for me. For instance, it describes how San Francisco, now such a tech hub, was once a major shipbuilding town, which in turn led companies there to purchase various manufactured goods — turbines, winches, radio equipment — from cities scattered across the country, from Schenectady, NY to Milwaukee, WI. But that is all changed:
The companies that now drive the Bay Area’s soaring wealth — and that represent part of the American economy that’s booming — don’t need these communities in the same way. Google’s digital products don’t have a physical supply chain. Facebook doesn’t have dispersed manufacturers. Apple, which does make tangible things, now primarily makes them overseas.
In the past, says one sociologist, smaller cities contributed to the rise of bigger cities, but a pattern has emerged in which the growth of major cities feeds the growth of other major cities, whether or not they’re in the same country. A business school professor goes a step further and theorizes that global connections increase a city’s prosperity, and is directly accompanied by a loss of ties to smaller cities in their own nations. The growth of a knowledge and service economy, which is seen to benefit large cities, is a key part of this trend.
The article also raises another point about the power relationship between the rising regions of the country and those areas left behind:
To put it more harshly, when global cities need other communities today, Ms. Sassen said, it’s often to extract value out of them. New York bankers need Middle America’s mortgages to construct securities. San Francisco start-ups need idle cars everywhere to amass billion-dollar valuations. Online retail giants need cheap land for their warehouses. . . [the] dynamic also leaves smaller places at the mercy of global cities, where decisions are made about which plants to close or where to create new jobs. And so Tulsa, Buffalo and Tucson turn to Seattle as supplicants for a windfall of Amazon jobs.
What was once a symbiotic relationship among American locales has, from a certain point of view, turned exploitative — or even parasitic, as happened when the financial industry’s thirst for mortgage-backed securities to sell led to the issuance of shitty mortgages and into the massive real estate bubble like we saw leading up the 2008 meltdown.
Here’s a thought experiment: if you had a theoretical economy where one-tenth of the population was rich and the other nine-tenths were exploited and ripped off by the one-third, and lived in abject poverty, but this economy was the same size as a one where everyone had the same income, our dispassionate modern measures would say that these two economies were equally productive and valuable. But common sense, not to mention basic humanity, say that this is not at all the case. And though we’re not there yet, this is the direction the United States is trending.
Though it doesn’t focus on them, the article itself raises some of the political implications of this change, suggesting that many Americans' perception that the benefits of globalization are passing them by is firmly rooted in contemporary dynamics such as the article describes. But this observation is only the tip of the iceberg. If the globalized economy by its very workings distributes benefits wildly unequally, what’s the role of government in attempting to balance out these benefits more equitably? Is there an economic solution to this question? Is unfettered, borderless trade inherently undemocratic and bound only to make the rich richer?
These are all necessary questions, since the very trends this piece details are having profound and disturbing effects on our country’s democracy and political stability, for which we need look no further than the election of Donald J. Trump to the highest office in the land. Republicans only provide bad-faith answers to the economic problems Americans are living: they would build a wall to keep out people who come to this country to take jobs no Americans want, but seem to have no ideas or even interest in addressing the real structural sources of inequality. Meanwhile, as I’ve discussed before, the Democratic Party coalition contains many people who are benefitting from this new economic arrangement that disproportionately rewards large urban areas. It is as if, at the highest level of the rules of the economy, we have changed the playing field, without any regard to how all the ordinary people of this country now tumble back and forth across its shifting landscape, some doing well, but others not being able to find their footing at all.
This is not just a moral question — although it is a deeply moral one indeed, which we have collectively avoided answering for too long. It is also an urgent political one. Because for every American who sees economic inequality and responds by calling for fair and democratic remedies, there’s another American who is ready to blame and rage at other Americans, along with immigrants, for causing this problem, and to abandon democracy for authoritarian solutions which will only ever result in the rich getting richer and too-big-to-fail businesses only getting bigger.
This is not to say that there are easy answers, let alone answers for which a national consensus exists. But to not ask these questions, in this deranged age of Trump, is in itself a form of madness. We can blame Trump all we want, but it’s the America we’ve built together that’s made him possible.
