Social Policy and the City

Susanne MacGregor. Handbook of Urban Studies. Editor: Ronan Paddison. SAGE Publications. 2001.

Poverty at the End of the Twentieth Century

The economic policies that have swept through the world since the 1980s, and now exercise almost complete dominance over politics and minds, have brought in their wake a series of social problems, most evident in cities, which are characterized as social exclusion, rising crime and violence. The irony is that these problems have grown in a period of unparalleled affluence.

Since the Second World War, global economic wealth has increased sevenfold and average incomes have tripled (Watkins, 1995: 1). Improvements have been evident in increased life expectancy, falling infant mortality, improved nutrition and educational attainment. Yet, ‘[t]oday, one-in-four of the world’s people live in a state of absolute want, unable to meet their basic needs’ (1995: 2).

A UN report in 1994 saw the situation thus: ‘the incidence of poverty in the OECD countries is distributed as follows: the number of single-parent families in poverty has grown; unemployment and insecure employment are increasing in significance as causes of poverty; and the elderly form a declining proportion of the poverty population’ (UN, 1994: 86). ‘In both Europe and North America, sluggish and uneven growth has left enclaves of unemployed ethnic minorities in declining industrial centres’ (McFate, 1995: 1).

In the USA, an additional four million children fell into poverty during the 1980s (UNICEF, 1994). ‘By 1992, child poverty affected 22 per cent of all [American] children, and infant mortality rates for black children were more than double those for white children’ (Watkins, 1995: 5). There were estimated to be 36.9 million poor people in the USA in 1992 – 14.5 per cent of the population. In 1971, this proportion had been 12.5 per cent. In the European Union, the number of people living in poverty grew from 38 million to 52 million between 1975 and 1988 (UN, 1994: 84). In the same period in the UK, the number of individuals living below the poverty line increased from five million to almost 14 million (Joseph Rowntree Foundation, 1995).

The phenomenon of a sense of reduced quality of life alongside rising overall income is a key feature of contemporary northern cities: ‘substantial improvements in living standards and material well-being have been accompanied by a weakening of the social fabric reflected in the rise of homicide, crime, drug abuse, suicide, divorce and illegitimate births’ (UN, 1994: 228-9).

Concepts of Poverty

Some commentators question whether poverty can be measured and compared across continents and time periods. Increasingly, it is argued, not only can this be done but it must be so if progress is to be made (Townsend, 1993). ‘Poverty is at the same time culture-bound and universal’ (Oyen, 1996: 4). Key ideas in concepts of poverty are subsistence, basic needs and relative deprivation. The major part of poverty research, since its beginnings one hundred years ago, has focused on counting and measuring the extent and nature of poverty. But such statistics do not lead automatically to clear-cut solutions. ‘Unacceptable numbers of poor people can be portrayed both as a demonstration of unworthy poverty conditions and as a demonstration of a spreading moral ill’ (Oyen, 1996: 9). Constantly, distinctions have been made between the deserving and the undeserving poor: ‘[t]he language of poverty is a vocabulary of invidious distinctions … we use our language to exclude, to distinguish, to discriminate … by mistaking socially constructed categories for natural distinctions, we reinforce inequality and stigmatize even those we set out to help’ (Katz, 1989: 5-6).

The poor and poverty cannot be understood in isolation from an understanding of their society and city as a whole. At the centre of any explanation are the relations between these groups, these individuals, and the rest of their city and society. ‘The non-poor and their role in creating and sustaining poverty are as interesting an object for research on poverty as are the poor’ (Oyen, 1996: 11). This is why the study of policy and policy responses is so important. Through an analysis of policies and practices, we can discern the crucial relations between groups in society, in the cities, which shape the size and nature of the social problem of poverty.

It is worth reminding ourselves of what Gans has described as the functions of poverty (Gans, 1991). The existence of poverty may be of benefit to others in the city: it may encourage discipline, hard work and proper behaviour patterns -serving as a warning of what befalls the deviant and miscreant. The poor have even been seen more recently as crucial to sustainable living, by ecologists who applaud their role in recycling waste products, like the rag-pickers of Bombay and the refuse-collecting Zabbaleen of Cairo. Being willing to work for low wages, the poor also contribute to the control of labour demands and inflationary pressures. The poor may serve as the scapegoats for deep fears about the city in a late modern climate, carrying on their backs fears of violence, crime and of the stranger.

Discussions of poverty in the particular setting of the city have often been concerned to point to quality of life issues as much or more than measures of absolute or simply material poverty. The components of quality of life indexes are open to debate, ranging as they do from years of schooling to measures of political freedom and civil rights, but they are valuable attempts to include aspects of human dignity as well as mere survival in the account. Most commonly, life expectancy at birth has been taken as a proxy measure of human welfare. On this indicator, it has been shown that for some groups in some parts of First World cities, their quality of life is lower than that of some groups in the developing world. Urban poverty in both First World and Third World contexts appears to have some distinctive characteristics: the influence of the informal labour market (both illegal and semi-legal or unregulated); the notable presence of female-headed households; the impact of environmental hazards; and the stress of social and personal isolation. Other issues that figure in the context of discussion of the cities concern matters like personal suffering, fear, vulnerability, injustice and a sense of dignity. Granted that the miseries of the city and those of rural areas may simply not be comparable, that miseries exist in the cities, even in countries and cities which are overall wealthier than they have ever been is the stark fact which characterizes concerns about social problems in the contemporary city.

These problems have posed challenges to traditional approaches to social policy: ‘in the midst of the affluence and excess of the 1980s, most Western nations experienced an increase in unemployment and poverty that has left traditional safety-nets sagging and policymakers scrambling to adjust programs to fit a changing economic environment’ (UN, 1994: 229). Slower growth, more employment insecurity, restructured families and more diverse communities pose questions for social policy in the cities of the advanced industrial countries.

Explanations and Changing Perceptions

What is now evident is that we are living through a period of profound social and economic transformation, one with political and cultural ramifications. The changes in this late industrial period are equal in scope to those of that earlier great transformation, brilliantly analysed by Karl Polanyi (1944). Polanyi argued that in all previous human societies, the economy was submerged or embedded in social relationships. The distinctiveness of modern industrial capitalism lies in the way the market is seen as separate and dominant. The central argument of The Great Transformation is that the liberal utopia of a generalized self-regulating market is a prescription for disaster.

Polanyi wrote in the 1940s after a period which had, like that of the 1980s, attempted to restore the nineteenth-century liberal economic order. The results then included the rise of fascism and Nazism in Europe. In the USA, the New Deal demonstrated a rather different kind of response. Now some argue that the lessons drawn by Polanyi are relevant once again. Prioritizing the profit motive above all else is a recipe for social and cultural degradation. This has been identified (perhaps unfairly) as a specifically Anglo-Saxon cultural trait, one which elevates ‘institutions of private property, private enterprise and private profit to normative ends in and of themselves and the fiction of “economic man” to a pseudo-scientific shibboleth’ (Levitt, 1995: 8-9).

This sense of a clash or contradiction of interests and values is encapsulated in the concept of the dual city, which has been popular in explaining social polarization. The aggravation of social exclusion and structural unemployment is thought to have resulted in the rise of dual societies almost everywhere (Bessis, 1995: 7). The dominance of the market and deregulation approaches in recent years has produced the two-speed society, most visible in the large cities.

This concept has, however, been criticized for resting on a vague and confused image of the post-industrial city, not standing up to evidence and glossing over the complexity of social processes and social relations (Mooney and Danson, 1997; Vankempen, 1994).

Undoubtedly, however, urban inequalities have increased in all advanced countries in recent years. ‘Persistent joblessness, material deprivation, and ethnoracial tensions are on the upswing throughout much of Western Europe and North America as segments of the urban population of these countries appear to have become increasingly marginalized and segregated economically, socially and spatially’ (Wacquant, 1995: 543). Fears about a black underclass trapped and cut off in the urban core in America are mirrored by fears about the new poverty of groups on outer estates or in the banlieues of Europe.

So as the 1980s moved on into the 1990s, there grew an increasing awareness that all was not well in the cities. The most common explanation offered for these social ills was that an urban underclass had developed, composed of non-working poor whose moral and individual shortcomings accounted for what was happening. These should be the target of new social policies. These underclasses were usually seen as being primarily composed of particular ethnic groups, in the USA of African-Americans, in other countries of ‘immigrants’. Racism and reaction found an outlet in the rising political impact of far-right groups, whose activities tended to violence.

The alternative structural explanation, stressing factors other than individual failings, pointed to increasing bifurcation of the job market between, on the one hand, highly skilled and well-paid jobs, and on the other, low-skilled, low-paid, insecure and part-time employment. Unemployment had become concentrated among the least skilled and long-term unemployment had increased. Such structural unemployment was seen to pose challenges to conventional social protection programmes.

At the same time, the share of service jobs in the overall economy of all these countries was rising. Wage inequality increased, with the least educated suffering most decline. Part-time work increased, as did other forms of temporary, contingent, insecure employment (contract, short-term, self-employment) and women were more likely to be found in the category of part-time employment. These non-standard employees are least likely to have robust social insurance or other protection, such as access to health, disability or accident insurance and pension entitlements. ‘There has been a new “flexibility” in private sector work arrangements, but it has not been matched by a new flexibility in social protection programs’ (McFate, 1995: 9). Households with young children, especially where the parents are unemployed or unskilled, or where a mother is the head of the household, are at risk of being in poverty and these risks have increased in recent years.

All explanations, behavioural and structural, concluded that welfare reform was required (Atkinson, 1995).

From Poverty to Exclusion

In attempting to grasp these changes, and develop appropriate policy responses, social analysts developed a new language. The social question is now one of exclusion rather than of poverty (cf. Social Summit, UN World Summit on Social Development, Copenhagen, 6-12 March 1995). The replacement of poverty with exclusion is primarily a switch from static to dynamic analyses, focusing not merely on counting the poor but highlighting the processes which lead to exclusion. These debates also link into analyses of social disintegration and pauperization. Of course, academic discourse is never wholly innocent and rarely less so than in the field of poverty research. Discourses of poverty are part of a political contest where those involved aim ‘to act upon reality by acting upon its representation’ (Wacquant, 1995: 546). The concepts used create, and are themselves permeated by, commonsense theories of poverty and social relations. They are shot through with assumptions about causes and solutions to the social problems so constructed.

One issue on which this chapter will try to cast light is whether or not there are fundamental differences in approach between the Anglo-Saxon’ liberal regimes and the conservative, continental European regimes (Esping-Andersen, 1996). It is interesting to note that in many ways these approaches appear to be converging. Or, it may be concluded, they are being superseded by a new consensus on social policy, one which focuses on partnership and places greater stress on both individual responsibility and state compulsion at one and the same time.

Wacquant argues that there are fundamental differences between American and European discourse, with Europeans emphasizing a language of class, labour and citizenship and Americans being anchored in vocabularies of family, race and individual moral and behavioural deficiency (1995). Whereas in the USA the central concepts are those of underclass and the new poverty, in Europe, the key term employed is that of social exclusion. It is in France that the language of exclusion has been used most explicitly in policy design and from there that ideas have spread into the discourses of the European Union:

The emphasis is now on the structural nature of a process which excludes part of the population from economic and social opportunities. The problem is not only one of disparities between the top and bottom of the social scale but also between those who have a place in society and those who are excluded. (European Green Paper on Social Policy, CE-81-93-292-EN-C)

Those involved in consciously constructing the European Union paid a great deal of attention to this issue. The final report of the Second European Poverty Programme commented that the completion of the single market … will not be seen as an unqualified success if it does not take the phenomenon of social exclusion into account (CEC, 1991: 27). The report warned:

there is a considerable risk of two different societies developing within member states, one of them active, well-paid, well-protected socially and with an employment conditioned structure, the other poor, deprived of rights and devalued by inactivity. (CEC, 1991: 8)

Policy Options and Debates

Welfare state protections have been under attack in many countries in campaigns to make labour markets more flexible. New forms of social protection are thought now to be required to respond to the growth of the informal economy and the decline of traditional work careers.

In both the USA and Europe, there are urban enclaves of entrenched poverty where housing blight, joblessness, educational failure and ethnic/racial discrimination cumulate into constellations equally impervious to policy intervention (Wacquant, 1995: 543). Inner-city areas in the USA are on the whole more degraded than those found in European cities. Yet the lived experience of the inhabitants of poor neighbourhoods ‘exhibit striking similarities, owing to their structural position at the bottom of their respective social orders’ (Wacquant, 1995: 546). American ghettos share the ubiquity of joblessness, welfare receipt and poverty, the destruction of housing and the waning of the economic fabric. In Europe, outer estates are stigmatized public housing projects, on the peripheries of cities, decimated by deindustrialization, dependent on public assistance and characterized by multiple deprivation.

But while there are similarities, there are also differences between countries. Wacquant sees the core of the American situation as racial exclusion; the core of the European as class fragmentation. France and the USA, for example, differ in the extent to which they ‘regulate the lower segments of the labor market and have elaborated policies to absorb and redistribute the social costs of the restructuring of their economy … [and in the extent to which] they provide their citizens and residents with minimum standards of living and segregate social provision from “welfare”’ (Wacquant, 1995: 544).

The French state has an extensive array of industrial reconversion, unemployment and training policies and retains an active, interventionist labour policy (in spite of relatively low rates of union membership). There is universal health coverage and also family allowances and a national guaranteed minimum income plan. The USA lacks most of these, although having extensive educational provision and social security for older people.

The US Welfare Regime

American ghetto residents traditionally relied on public assistance benefits: Aid to the Aged, Blind and Disabled; Aid to Families with Dependent Children (AFDC); General Assistance; and Food Stamps. These varied in different states. In most, the standard package was insufficient to lift recipients close to the poverty line. ‘Receiving welfare … is tantamount to enforced destitution’ (Susser and Kresnicke, 1987). Escape was difficult because there is little public transport and most do not own a car.

The conditions so eloquently described over many years by W. J. Wilson and his colleagues at the University of Chicago led to a disconnection between these areas and the rest of the city. In these conditions, drug-peddling, prostitution and thieving became common. The invasion of crack towards the end of the 1980s added to this plight and increased the prevalence of violence. Soup kitchens tried to meet the needs of the hungry, malnourished and homeless (DiFazio, 1995).

Medicaid was introduced in the USA to provide better access to health care for those with low incomes in 1965. But inadequate primary care is a key problem in low income areas. One survey in 1988 of community-based physicians in nine of New York City’s low-income communities found that there was a shortage of nearly 500 primary care physicians. Use of hospital outpatient departments and emergency rooms was two to four times higher than in more affluent communities in the city. More than 70 per cent of the practitioners were graduates of foreign medical schools – that is, very few graduates of New York State or City medical schools practised in these poor communities. The Medicaid reimbursements were inadequate to sustain a practice in these areas (Brellochs et al., 1990).

Under President Clinton, the USA began to wage war on welfare. This reform of welfare involved a change from entitlement to one where cash assistance would last only two years. After this time transitional work would be required.

There are two underlying problems with workfare schemes. First, if the jobs are of any value, the system will discriminate against unemployed people who are not on welfare or have not exhausted their entitlement, to whom such jobs will not be available. Secondly, if such discrimination is avoided, they are likely to be filled by workers displaced by restructuring, who are not likely to be long-term welfare dependents in any case. The logic is therefore that welfare jobs will be poor jobs.

Nat Glazer argued in 1995 that Clinton needed a welfare reform plan mainly for symbolic reasons not because there really was a welfare crisis. ‘Welfare’, he said, ‘has come to stand for the rise of a permanent dependent population cut off from the mainstream of American life and expectations, for the decay of inner cities, for the problem of homelessness, for the increase of crime and disorder, for the problems of the inner-city black poor … Ending “welfare as we know it” seems to promise some relief from these social disorders’ (Glazer, 1995: 21).

The policy debate was fuelled by stereotypes about poor city residents. Research has shown, however, that high poverty areas contain a good deal of social and economic diversity. Although some residents clearly engage in “underclass” lifestyles, many of their neighbours are not public-assistance recipients and do participate in the labor market, albeit in lower-skill occupations and for fewer hours and lower wages’ (Jargowsky, 1996: 579).

Two changes have occurred in social values in the USA which encouraged moves to welfare reform. One is the acceptance, even the requirement, that mothers with children should take paid employment: bringing up children is not seen as sufficient employment for mothers who are not supported by a male breadwinner. And there is emphasis on responsibilities in return for opportunities—people who receive income support should pay back in some way to the society that is providing their income. People are not seen as being poor because of factors outside their control—they are seen as being in some way responsible for the condition they are in. The poor are no longer seen as respectable and deserving but as mainly disreputable and undeserving. Education and training and work experience are expected to change the character of the poor as much as provide them with new technical skills.

It was the rise in the poverty population after 1973 that caused alarm and led to the conclusion that previous anti-poverty programmes were not working. The main programmes were AFDC, Food Stamps and Supplemental Security Income (SSI). Through these programmes, the USA was spending around 1 per cent of its gross domestic product on families and individuals with incomes below the poverty line. It was AFDC which was equated with ‘welfare’. The overwhelming bulk of recipients were women and children. The real value of these benefits had been declining since 1973 but the numbers relying on it had grown. AFDC spending accounted for about 1 per cent of the federal budget and about 2-3 per cent of the budgets of most states. The decline in AFDC benefits’ value had been offset by a rapid increase in expenditures on the Food Stamp programme, the only programme available to all the poor. SSI, payable to the elderly, blind and disabled, had also been growing steadily. Medicaid and public housing supplements were the other important elements in the American system of support for the poor.

Innovations aimed to encourage return to work included the Earned Income Tax Credit (EITC), a refundable subsidy to earned income directed primarily at low-income workers with children. It provided the model for the UK’s Working Families Tax Credit (WFTC), introduced by the new labour government in the late 1990s. Such targeted programmes are generally shown to have clear effects in removing considerable numbers of people from living in poverty or below conventionally determined poverty lines (whatever debate there might be about the adequacy of these poverty lines). Without these programmes, many more people would live in poverty. ‘The erosion of labor market opportunities for people with low levels of education has placed an enormous strain on the nation’s anti-poverty programs’(Haveman, 1995: 190).

It is this situation which led in all Western countries to the move to reform welfare programmes, to make work pay. The aim was to add into EITC or WFTC schemes forms of childcare assistance and job training, and to encourage more parental responsibility, including stressing the responsibility of biological fathers for their offspring (as through the Child Support Agency in Britain), and utilize workfare measures, including education and training and signed contracts (as in the French RMI). Teenage mothers are encouraged to live with their parents rather than form independent households: more case work by social welfare officers is part of the new systems (as it has been in Sweden for some time and is now in Australia). The aim is to ‘change the expectations of the poor and establish a new norm’ (Haveman, 1995: 191). There is less use of incentives and more use of compulsion in these new welfare policies, which stretch across industrialized countries from Australia to Europe and the USA – countries which follow each other’s experiences and deliberations closely and borrow ideas and plans at remarkable speed.

Many of the ideas originated in the USA and were transplanted to other countries. How generally appropriate are they? A central continuity in American society is its racism – what Myrdal called the American Dilemma and what Gans says could now be called the American Impasse – ‘for racial segregation and discrimination have proven more stubborn than Myrdal believed’ (1991: 273). Race and poverty are tightly interconnected in the USA. In recent decades, blacks, both male and female, have been ‘driven further to the margins and out of the economy’ (Gans, 1991: 295). The decline in the labour force participation of young black men is of staggering proportions. This is explained by the lack of jobs and also by the fact that a high proportion are in prison or have dropped out altogether and committed themselves to the underground economy. Others have died – to such an extent that some have talked of young black men as an endangered species – because violence is ever present in these poor neighbourhoods, making death from homicide a leading cause of death in young black men. This has produced what W. J. Wilson has termed a decline in the pool of marriageable men – explaining the increasing likelihood that young women will remain unmarried even if they have children. Conservative researchers see this family form as the main cause rather than a result of black poverty. The difference is one of emphasis and of attitude – whether to condemn or to understand. The conservative approach is that marriage solves all problems.

A key point made by Gans is that the problems for African-American city residents did not begin with the de-industrialization of the 1980s. Feminization of poverty has a longer history in these communities too. What changed, according to Gans in the 1980s was that the numbers Moynihan reported rose and heroin and crack cocaine literally destroyed a number of poor black families (1991: 276). While these differences in explanations reflect old divisions, what was new, and added urgency to the policy debate, was that the economic problems of poor people became so much worse, and the disorder in the cities much greater. People began to describe their local areas as war zones and those working in accident and emergency rooms in big city hospitals became experts in dealing with injuries otherwise usually only seen on the battlefield. As these conditions got worse, the attitude of the better-off became less caring, more rejecting, more willing to blame the victim, and more willing to support intensely punitive policies. ‘Labelling needy people as undeserving as a way of depriving them of help is an old American solution; and it is also a cheap one because then anti-poverty programs do not need to be considered’ (Gans, 1991: 277).

Gans pointed out that this is a short-sighted view, because poverty produces costs for society as crime and other forms of resistance and rebellion increase, and the drug economy grows: ‘once the price of extra police, courts, prisons, mental hospitals and the like is factored in … the total price is not much less than a set of effective anti-poverty programs which would begin to reintegrate the poor into the economy and incidentally turn them back into full taxpayers’ (1991: 277).

The problem is that such policies rely on the support of the majority for implementation and such support is no longer present.

Specific Urban Initiatives in the USA

Over the past two decades, a number of policy changes in the USA have constrained the role of local governments. Fiscal straitjackets, fiscal stress and recession forced tax increases and service cuts at state and local levels. In the 1960s and 1970s, American cities had seen dramatic and destructive riots and social violence. The poverty programme resulted. It was seen that there was an urgent need for action in the ghettos. Public interventionist approaches were adopted, which relied on federal assistance to localities through various anti-poverty measures. This approach was pulled back by the Nixon administration. Later President Carter introduced a new urban policy, which led to an expansion of several major programmes of community and human development. Increased financial support for urban housing and social services was provided. The aim was to create liveable cities, utilizing in some areas joint public-private partnerships. Still the infrastructure deteriorated. Under President Reagan there were further budget cuts in public programmes. The cities were singled out for budget reductions as part of general policy to reduce the inflationary effects of public expenditure, shifting responsibility to states and reducing the role of federal government. Paradoxically, this led to renewed dynamism at some city and local levels as local leaders responded energetically. Even tighter controls made things more difficult for cities, however, with the impact of the Gramm-Rudman law aiming to move to balanced budgets. More budget cuts followed, plunging some cities into fiscal crises and leading to cuts in social provision, from higher education to soup kitchens and night shelters.

These developments were paralleled by an intellectual assault on the poor from the right, wherein welfare programmes were seen as the cause of urban poverty. On the contrary, argued their opponents, the main cause was unemployment. Herb Gans, for example, has consistently argued that ‘America’s major urban problems [are] poverty, joblessness, the scarcity of decent jobs … racism and other kinds of inequality’ (1991: ix) and that ‘the central problem of our cities [is] decent and secure jobs for everyone and income grants for those unable to work or unable to find it…. [M]any other urban problems would almost solve themselves if such jobs and grants could be supplied’ (1991: 189). Private business will never be willing or able to provide the necessary resources for this – only government can do so – but this is not the conventional wisdom at this time. But, states Gans, conventional wisdom has often been wrong, so those who think otherwise must continue to put their case.

The booming US economy in the 1990s appeared to have solved the problem with all but the very poor feeling as well or better off. Some argued however that this was a mirage with most new jobs being part-time or insecure and inequality increasing. Those who saw a jobless future (Aronowitz and DiFazio, 1994) stressed the need for policies like job-sharing or job-creation in socially useful areas. A central dilemma for all employment policies is whether to create decent jobs for the unskilled and semiskilled, who are those most often in need of work, or whether to train the low-skilled to take up more skilled jobs, which are those most likely to become available. Gans sees a place for both approaches. And he stresses there is a clear need for public works projects. Schemes to reduce the length of the working week and share available work around more fairly are also needed. ‘Despite its drawbacks, work-sharing is far superior to condemning a quarter or more of the population to permanent or near-permanent joblessness’ (Gans, 1991: 191).

European Welfare Regimes

Compared to the USA, the European countries confront the problems of economic change from a different base, having all established universalistic welfare states in the post-war years. The issue for them lies in the extent to which these systems can cope with the new situation. ‘Long-term unemployment is at the centre of the debate over exclusion in Europe … The problem is the risk that those who lose their jobs enter a spiral of cumulative exclusion’ (Rodgers, 1995: 254). The best way to tackle unemployment is to create jobs but on the whole this attempt has been unsuccessful. Where jobs have appeared, they have been increasingly part-time, insecure work, often taken by women. Special programmes for the unemployed exist but they do not show good results in terms of long-term reinsertion of the unemployed. Yet this ‘churning’ of the unemployed may have some value in preventing a proportion sinking to the bottom and becoming the long-term unemployed with a range of secondary problems; and for the individuals concerned, the provision of advice, training and support is appreciated. Nevertheless, it is obvious that policies of reintegration are of limited value without related, macro-level, effective employment policies.

There is a general tendency in Europe (as in America and Australia) to place more stress on welfare-to-work programmes of varying degrees of punitiveness, levels of remuneration, quality of experience and training and general support, especially with regard to childcare arrangements. Extensions of these include development of environmentally useful schemes, community schemes, financial incentives to employers to take on long-term unemployed people, temporary employment schemes with an element of restoring the work habit and training in social skills and work-seeking skills. Self-employment is also encouraged.

Much hope is now being invested in training as the ultimate panacea, with real benefits in some cases and in others mere accreditation – the effect being one of an inflation of qualifications. Training which is make-work and has the purpose simply of keeping the unemployed off the count has bred much cynicism and may increase exclusion, as some people decide to opt out altogether from the formal society with its compulsions and poor rewards. Longer-term policies argue for improving the general level of education, from primary school onwards, which may have wider benefits than mere increase in qualifications and individual knowledge and skills, by aiding the socialization process, producing a better integrated citizenry.

In France, the revenu minimum d’insertion (RMI) adopted in 1988 has led to a great deal of discussion. ‘The fundamental goal of the law was to link the right to the satisfaction of basic needs with the aspiration for social and professional reinsertion’ (Rodgers, 1995: 258). This was a particular response to the new poverty, that is, poverty among that old category of the able-bodied adult population. These groups were not covered by the existing insurance-based social security systems (a common problem in welfare systems, consequent on long-term structural unemployment, especially among younger people). The RMI combines an income allowance with an insertion contract. The social insertion is based on a social psychology of behaviour. The contract (a familiar tool in social work) is signed by the individual and the administration. It is claimed by the French as revolutionary, although some observers are more sceptical and see it as not very different from older principles of managing the able-bodied poor. The methods employed to establish reinsertion include actions to aid individual autonomy – providing shelter, health care, education and cultural assets; training relevant to the areas of future employment; instruction in enterprises, especially in conjunction with employers; and participation in NGOs or public administration. A key element is the location of the training and instruction – not being in separate locations but involving direct work experience in normal settings. It is important as a device to legitimate payments of income assistance but its effects in creating permanent employment in the long term are inevitably less impressive. These principles have also informed New Deal initiatives under Labour in the UK.

In all countries, the core concept of social insurance is under strain, not least in Germany, coming to terms as it has been with the effects of reunification and the constraints of a single European currency. Similarly

[i]n the UK which has created one of the most comprehensive (if not generous) social insurance schemes, the proportion of unemployed men receiving insurance benefits [fell] from 55 per cent in 1970 to 25 per cent in 1987 … In Germany, the proportion of unemployed with a claim to unemployment compensation or unemployment assistance fell from 86 per cent in 1975 to 67 per cent in 1987 … In France, about one third of the unemployed had no entitlement in the mid-1980s while another quarter had exhausted whatever entitlement they had. (Room et al., 1990: 3)

In response, a number of countries have emphasized targeting and the area approach. France and the UK have been strong on area compensation policies. Spanish interventions have also adopted an area and client-targeted approach.

Underlying these developments was the fact that the racial and ethnic differences between the poor and the middle classes challenged the basis of welfare state solidarities. If the welfare state assumed ‘I am my brother’s keeper’, some began to raise the issue of ‘Who is my brother?’ How far can a sense of shared responsibility be extended? ‘An estimated 4-4.4 million foreign immigrants now live in France; a little over a third are Muslims from North Africa. In Germany, there are currently 1.8 million Turkish guestworkers’ (McFate, 1995: 13). ‘In fact, multi-ethnic large cities have become the norm in most Western nations … such residential patterns often reinforce discrimination and separation from majority institutions and cultures’ (1995: 13-14).

Concentration increases visibility. Prejudices are exacerbated. The ‘creation of such “islands of isolation” defers integration … heavy ethnic concentration increases the awareness of the presence of a particular group and becomes the vehicle for social and political movements against further integration’ (OECD, 1987). ‘If poor market conditions and discrimination force minorities into informal or illegal sectors of the economy, a damaging dynamic may be set in motion’(McFate, 1995: 14).

European Urban Initiatives, Some Country Examples

As central governments became increasingly restricted in the range of options open to them, more attention was directed to lower levels of city and local governments as providing a space for interventions. Responsibility for a number of functions was passed to these lower levels, not necessarily with any transfer of funds. At this level, business can have more influence: local governments compete with each other to lure business to invest in their area. Public-private partnerships are now the order of the day.

Specific policies focus at an area level. A common approach in Europe, as in the USA, stresses a strategically linked, multi-agency, multi-disciplinary approach targeted on poor areas. A geographical focus is helpful for cross-sectoral working. The components of these approaches include local labour market policies, the provision or improvement of schools, roads and community services, incentives for enterprises, shops and banks to locate (or stay) in the area and housing improvements. ‘What is important is the institutional base of such initiatives, involving partnership and co-operation’ (Rodgers, 1995: 259). These partners will almost always include central government and local administrations, local associations, trade unions (to varying degrees), private business and NGOs.

The general conclusion is that these area-based policies have had an uneven impact. Interesting innovations have been explored, especially in the areas of cultural, environmentally focused and youth and sporting initiatives (Bianchini, 1990). The main problem has been the relatively small scale of the interventions in the context of the very large macro-level problems facing the countries concerned. Obstacles remain in implementing the idealized multi-agency, flexible approach. The cultures of different agencies and authorities are very different, the pace at which they work, whether there is a ‘can-do’ approach or whether caution and conservatism dominates, and issues of accountability and coordination, are not easily solved, certainly not merely by the rhetoric of partnership and working together. Expectations raised to be then dashed may produce cynicism and alienation, worse than what went before. NGOs and community organizations resent the contract culture, fear being taken over and having their goals and priorities distorted through involvement with state agencies: they fear they may lose their ability to innovate. The partnership approach may end up producing lowest common denominator results, catering only for the deserving needy, under the pressure to reach agreement before action can be taken. Ironically, this may produce standardized responses, rather than the diversity aimed at and necessary in the pluralistic, multi-factored situation in contemporary cities.

In France, socialist administrations in the 1980s launched comprehensive programmes for the social redevelopment of neighbourhoods, initially in peripheral social housing estates but later in inner-city areas also. These interventions included improvement of public service infrastructures, job creation and citizen participation in urban planning and they built on the concept of a contract between the state and local authorities. Urban problems rose high on the agenda in the 1980s, especially visible in the violent incidents which flared up on peripheral social housing estates. In response, the Rocard administration announced the creation of a Ministry of Urban Affairs to expand the Neighbourhood Social Development Scheme, a comprehensive package of housing, educational, crime prevention, job training and search assistance programmes, youth activities, and improved public services, in 400 officially designated ‘sensitive neighbourhoods’ across the country. These urban rejuvenation programmes incorporated explicit social objectives. Some accounts conclude that these interventions have proved effective (Donzel, 1993).

From an analysis of projects in Marseilles, Donzel concluded that the greatest gains were in education, vocational training and social reinsertion measures. A richer collective life has developed and a more robust community self-confidence. French urban policy at this time, according to Donzel, was relatively successful, largely because of the direct involvement and control of the central state, working in partnership with local authorities. The French Ministry for Cities was later abolished, it is said partly because it was too much tainted with the rhetoric of socialist administrations.

While, perhaps reasonably, there is a tendency to discuss European policies as one bloc, especially when making comparisons with the USA, it is important to note the substantial differences between member-states of the EU. Just as there are differences between states and cities in the USA, there are differences between the different countries and regions of the EU.

Greece, for example, shows an absence of a well-organized welfare state but, on the other hand, there are strong family support networks. The informal sector and religious associations play a large part. For this reason, urban inequalities and social exclusion in Greek cities have tended to be overlooked by policy-makers and also by researchers. But Greece has started to exhibit similar negative trends to those found elsewhere and is also similarly influenced by pressure from the EU for policy reforms.

In the UK, the 1977 White Paper, Policy for the Inner Cities, marked the first explicit recognition by government of the economic causes of many urban problems. It discussed economic decline, physical decay and social disadvantage. Mismatch between the skills of the local labour force and the demand for labour, as well as a lack of demand for labour in general were noted as important causes of unemployment (Department of Environment, 1977). But the British learnt quite early on after this White Paper that economic benefits of interventions do not substantially accrue to inner-city populations themselves. Trickle-down has hardly been credible to many involved in regeneration schemes, however loudly proclaimed by politicians in the 1980s.

Many of the most difficult poor housing estates are those which were used by local or city authorities as dumps for their problem families or as places to house those affected by urban renewal. In the UK, the sale of council property sliced away the more desirable residences and left much of the public or social housing sector with only those properties which no one wants to live in. Many policies have been concerned in recent years to improve these residual estates through better management, involving residents, sale to housing associations and special injections of funds. Rent arrears have been a particular problem. Where this is dealt with by housing benefits, soaring bills for public expenditure present a different problem (Stewart and Taylor, 1995).

Throughout the 1980s, a whole series of initiatives were launched targeted at inner cities (MacGregor and Pimlott, 1990), partly in response to the riots and disorder that characterized that decade. A review of the effectiveness of some of these policies by the National Audit Office concluded that City Action Teams promoted coordination at local level and provided a focus for action in some urban areas but their effectiveness needed further improvement. Urban Programme partnerships worked well in some areas but not in all. Enterprise Zones provided some benefits but proved to be an expensive means of regenerating run-down areas. The National Audit Office concluded that performance varied and there was scope for better communication (NAO, 1990).

Other reviews of national policy development have concluded that surprisingly little has been achieved. The gap between the deprived areas and the rest remains as wide as before and in some respects has widened.

The Move to Partnership

In the UK there is now a political consensus that a multi-sectoral partnership approach is essential to achieve urban regeneration. The Single Regeneration Budget and the establishment of integrated regional offices brought together the Departments of Environment and Trade and Industry to try to work out a common approach to the problems of run-down areas. As a term however “partnership” is overused, ambiguous and politicized’, (Hastings, 1996: 253). There are at least two interpretations of partnership. The Thatcherite approach stressed privatization and the centralization of urban policy. The centre-left are now more prepared to see a place for local involvement, not necessarily, however, organized through elected local authorities.

Michael Ward, now leading development in London in the new governance structures has argued that to deal with disadvantage and to exploit opportunity, city-wide strategies are necessary to overcome economic, social and environmental problems (Ward, 1994). Such policies should build a consensus of partnership involving civil society as a whole, seen as consisting of the private sector, voluntary and community groups. These approaches have been shown to be successful in the management of health care in Canada and in the European Healthy Cities network. The main aim is to replace a sectoral approach with a wider vision of the context in which problems are situated. In Canada, a community-type approach, based on local action, led to the creation of health care councils in a number of Canadian cities. The activities of these councils included the discussion of problems, development of solutions and the collecting and dissemination of ideas (Bessis, 1995: 47). Similarly, the European Healthy Cities initiative, implemented in 30 European cities, aimed to act in all domains having an impact on health care, such as housing, transport and the environment and to encourage decision-makers to take into account the consequences of their policies on health care as a whole, not merely thinking of the interests of their own sector.

In urban policy, Ward (1994) argues for a people-led not a property-led approach. City government should have a leading role but should be driven by wide participation and as much devolution of control to local neighbourhood level as possible. For this to be effective, however, new sources of finance will be required, such as local business rates; a national Urban Programme; and European investment.

The Role of Local Government

Local consultation, community involvement and partnership are terms that are assuming increasing prominence in the discourse on urban regeneration, not least in the British New Deal for Communities. There are differing views however on the role of local authorities. Some argue that local authorities should be at the centre of efforts aiming to improve the environment of cities. In housing and employment schemes and in provision of public transport, local authorities can partner with groups in their own communities and striking improvements can be made. Others are more sceptical, seeing local authorities as corrupt or incompetent. The World Assembly of Cities and Local Authorities’ declaration at the Habitat II conference in Istanbul, May 1996, included the principle that ‘towns and cities must give more attention to social integration and the struggle against social exclusion’. This could be achieved through greater decentralization and acknowledgement of the strategic role of local authorities. In this new era, it is thought that mayors can play a particularly important role as agents of change.

The key question is whether or not local politicians closely link to and represent the poor in poor communities. Traditionally, the powers of exit and voice have been few in poor areas. Greater stress is now placed on community involvement and more open structures of local government. In practice, community involvement can range from a minimal consultation, largely designed to fend off dissatisfaction (even riot), to more robust approaches which rest on a pooling of resources and the development of autonomous organizations. More attention is now being given to fostering an older tradition of mutual help through encouragement of self-help, skills development and participation. Methods adopted have included localized estate-based housing management. Many of these community initiatives are, however, small and fragile and lacking in power compared to the power of city government, large employers, and the like. And it must be remembered that the central cause of the disempowerment of the poor is the contrast of conditions and opportunities in rich and poor areas.

In many of these developments, the idea of networking has assumed greater importance -networks within localities and between localities. As poverty and inequality rose in the 1980s and 1990s, a number of cities in Europe established committees to examine the problem. The Association of Metropolitan Authorities in Britain created an Anti-Poverty Network (Balloch and Jones, 1990), which spread out to link with similar initiatives across Europe. Sharing experiences has been a key aim of these proliferating networks. For example, a global Inter-City Network launched by the Prince of Wales Business Leaders Forum aimed to share experience of corporate-community partnerships to regenerate urban areas. Innovative inner-city projects in New York, Atlanta and Los Angeles were taken as models from which other cities as far apart as Russia, Asia, Latin America and South Africa might learn. In the USA, the Coalition of Mayors puts pressure on federal government and raises the profile of cities and urban issues. And the ‘Neighbourhoods in Crisis’ programme, sponsored by the European Commission, ‘brought together disadvantaged communities from a number of European countries to examine the basis of renewal strategies’ (Ward, 1994: 40). The European Union’s Urban Initiative was designed to build on these networking experiences in order to spread innovative approaches to urban policy.

Community or Citizenship?

In the First World cities, policy in post-war years moved through a number of phases: encouragement of new towns and/or migration to the suburbs; responding to racial tensions; developing social and welfare programmes; increasing stress on inner-city areas; property-led regeneration; and then a return to more social approaches to renewal. These more social approaches can include: training and education; city economic strategies; community renewal; urban industrial policy; institutions for regeneration; and job creation programmes (Ward, 1994: 14).

A wide range of options are available to city governments to alleviate or reduce poverty, if these governments have the will and the capacity to implement such policies. Options include employment creation, improving access to justice, protection from crime, improvements to services such as water supply, sanitation, solid waste management, public transport, health care and education. These needs are shared between cities of the developing and developed worlds. Notably also all proposals now stress the importance of encouraging and supporting the activities of community-based organizations, NGOs and the private sector – through various partnership arrangements. For these to work effectively, changes in local systems of regulation may often be required (Wegelin and Borgman, 1995).

Many schemes now aim to stimulate community involvement to improve poor or disturbed neighbourhoods. Malfunctioning is assumed in many of these approaches but others stress the strengths of communities, on which new initiatives can be built. Examples are community safety and community policing schemes, and community development approaches to drugs prevention.

Experience has shown that community involvement in local improvement projects does not always work. Especially where local residents are not home-owners or have no other investment or commitment to their property or neighbourhood, there is little in it for them should they become involved. Growing separation of areas by housing tenure is thus a problem, which, some have argued, can be altered by stressing housing mix more strongly in both public and private sector housing developments. Another route is to stress that the organizations promoted should be concerned with more than just housing. Others have advocated the sale of public housing to tenants as a means of giving them a stake in the community and thus the motive to prevent deterioration. However, there are others who argue that evidence does not support the claim that residents of inner-city public housing are less likely to become involved in community affairs than inner-city homeowners. Factors other than housing tenure status, such as church attendance, family structure and the number of families in the neighbourhood, explain the variation in rates of community participation (Reingold, 1995).

Philanthropists, such as the Kellogg Foundation, have provided funds to develop sustainable communities (for example, the Healthcare Forum supported by the WK. Kellogg Foundation in the USA).

In order to address the problems of American urban communities, a new approach is proposed using the concept of ‘collaborative empowerment’. Community and neighbourhood-based organizations are allowed to design, implement and assess problem-solving strategies, with advice being provided to them on organizational management and to strengthen community leadership (Johnson, 1996). The Kellogg Foundation has promoted and fostered the concept of urban and community leadership through support for projects in the USA and in other countries, such as South Africa.

But while community is the key term in US approaches, it is citizenship in Europe. The solution to urban poverty and exclusion, according to the Centre for Local Economic Strategies in Manchester, lies in renewed citizenship, based on rights ‘to work, to housing, to an income, to public services, and above all to human dignity; a citizenship based on equality before the law, equal treatment, and equal access to public services. It is also a concept of active citizenship: participating in a restored and renewed local democracy with opportunities for direct citizen involvement at local level’ (Ward, 1994: 2).

But, in truth, how much difference is there between the community and citizenship approaches when it comes down to the level of practical policies? There may be a different language and terminology in use but the practical proposals often look very similar.

There is an unfortunate tendency (perhaps understandable given the breadth of material to be covered) in discussions at international level to contrast the Anglo-Saxon’ with the ‘European’ models with Britain seen as wavering between the two. These stereotypes dangerously ignore important differences within countries and the clashes of interest and the policy debates raging there. Crucially, the interests of business, multinational companies and banks, for example, cross-cut national differences, as do the linkages between trade unions, anti-poverty groups, churches, social democratic associations and social analysts.

For example, the package of proposals proposed by Ward and others in Europe is very similar to that put forward by people like WJ. Wilson and Elliott Currie for American cities (Currie, 1993; Wilson, 1996). They share a common social and democratic framework.

Wilson argues that the problems of the poor in the cities are so great that they ‘require bold, comprehensive, and thoughtful solutions not simplistic and pious statements about the need for greater personal responsibility’ (1996: 209). He calls for ‘the integration and mobilization of resources from both the public and the private sectors … to generate a public/private partnership to fight social inequality’ (1996: 210). The USA has to catch up with other industrial democracies: ‘the United States is alone in having no universal pre-school, child-support or parental leave programs’ (1996: 215).

‘The French cité and the American ghetto are both viewed as “dangerous places” in which violent crime and delinquency are commonplace and create a climate of fear and insecurity’ (Wacquant, 1995: 559-60), but they are not comparable in reality. ‘The incidence of homicides and street violence (shootings, muggings, rape and battery) in Chicago’s ghetto has reached levels comparable with that of a civil war and caused the virtual disappearance of public space’ (Wacquant, 1995: 560).

Wilson agrees with this analysis and states that ‘none of the other industrialized democracies has allowed its city centres to deteriorate as has the United States’ (1996: 218). What is needed is better public transportation, more effective urban renewal programmes and good public education. But it will be difficult to tackle any of these problems or the racial tension associated with them until the country faces up to the issue of the ‘shrinking revenue and inadequate social services and the gradual disappearance of work in certain neighborhoods’ (Wilson, 1996: 218). To do this would require restoring the federal contribution to the city budget and an increase in the employment base. The fiscal crisis of the cities could be alleviated if the employment base could be increased significantly. Wilson supports ideas for neighbourhood revitalization, such as community development banks, non-profit inner-city housing developments and enterprise zones but, without greater collaboration between the suburbs and the cities, these will prove inadequate to the problem. This will require some form of tax-sharing, collaborative planning (especially of public transit systems) and the creation of regional authorities.

A popular alternative view in the USA however is that zero-tolerance and high rates of imprisonment can be most effective in restoring city areas, as in New York’s Manhatten.

European countries are facing similar problems to those of the USA and their welfare states are under strain. Resentment against immigration and other excluded groups is growing. The question is whether welfare states can evolve to adapt to changed conditions without abandoning their core principles.

From Welfare to Work

In most social policy regimes, there is increasing emphasis on encouraging work rather than expanding welfare entitlements. The choice is between minimum wage policies, based on greater sharing out of the available work, and minimum income policies, which do not require a work contribution. European countries have developed policies to get unskilled workers into low-wage jobs. These initiatives should be ‘buttressed by maintaining certain desirable aspects of the safety-net, such as universal health insurance, that prevent workers from slipping into the depths of poverty, as so often happens to their American counterparts’ (Wilson, 1996: 221).

In the end, a major source of poverty alleviation must be the generation of employment. ‘Employment creation remains the most powerful instrument for reducing both inequality and poverty. For people to be employable, they must be healthy, educated and skilled’ (UN, 1994: 87). One approach is to act directly on the job market through voluntaristic policies involving a mix of sanctions and incentives on employers. An active job creation programme might involve the creation of social service jobs, which are generally undersupplied. Another related approach, much favoured at present in many countries, is to concentrate on improving the skills of the workforce through better education and training. Linked to this are equal opportunity policies. Day care and family planning policies are also relevant here. These policies, customized to local conditions, of course, are as applicable in the ghettos of the USA as in the outer estates or banlieues of Europe or the towns and villages of India or China.

Minimum wages set at reasonable levels clearly have a part to play. These wages, combined with medical insurance and child provision (a classic Beveridgean idea), should be adequate to pull a family out of poverty (albeit the old problem of housing costs is still around). Yet in the USA, the issue of moving to universal health care provision—a major lack in that country—is still one which has defeated politicians. Underlying all these discussions is the decline in unskilled work or work suitable for those with limited capacities and competencies. To solve this would require a policy of public sector employment of last resort. These jobs might take the form of public sector infrastructure maintenance jobs, or public service jobs. The need is clearly there for both, and society as a whole would benefit, but such solutions would not be cheap.

While leading figures, like Wilson, try to persuade Americans to adopt European solutions, there is the issue of whether social democracy is itself unravelling in Western Europe. Social democracy represented the third way between America and the Soviet Union during the period of the Cold War. The end of the Soviet Union has posed a threat to social democracy as the fulcrum has shifted. In addition, all parties take for granted middle-class resistance to paying taxes. Given growing needs for human services, there is a need to find new ways to get money into the system, perhaps through forms of hypothecation or independent social insurance funds—various proposals have been suggested. The key problem is the underlying lack of social solidarity, as the base for a sense of common interest, common identity and common threat appears to have eroded. Perhaps in future the locality may provide a more hospitable base for such commonalities to be identified, although this runs the risk of excluding from all localities those who are viewed as outsiders and undeserving – creating a new vagrant class.


The two-speed city on the American model is more than just a potential risk: it is becoming a reality. In most European cities, access to work, housing, education and training, to culture and to health, is a right from which certain social groups—young people, women, ethnic minorities, the long-term unemployed—are excluded. This fact is made even more unacceptable in that the excluded are concentrated in vulnerable areas of cities, often next to areas of conspicuous affluence. (Delegation Interministerielle á la Ville, 1990 report for the European Commission)

The policies which emerged in post-war years and were labelled welfare state policies were themselves responses to what were seen as the failures of the 1930s. At the international and at national levels, the motive was ‘never again’: governments took responsibility for the basic social and economic welfare of their citizens and poverty and mass unemployment were identified as evils to be outlawed. A post-war social settlement with similar features emerged in most countries, although to varying degrees. The key characteristic of this settlement was acceptance of the role of markets (capitalism), but its power was to be tempered by state regulation, in the public interest. Areas seen as crucial to effecting social justice were universal health care, universal education, secure employment and income support when employment was not possible (through old age, disability, childcare, maternity, etc.). These ambitions were pursued and achieved to varying degrees in different countries but the broad shape of what would be needed to abolish poverty was roughly seen in the same way. As this settlement crumbled in the late 1970s and policies of neo-liberalism and structural adjustment were applied extensively in the 1980s and 1990s, the social evils which some had thought conquered returned with a new force.

Arguments for a need for change in welfare systems point to the changed basis of poverty. Income support schemes based on insurance contributions and/or employment records are inadequate for young people, those with part-time work and cycles of employment/unemployment – because of their infrequent and unstable contribution records. As important here is the need felt by centrist politicians to keep taxpayers on board: it seems that to maintain their willingness to pay taxes to support the poor, an element of punishment must be built into systems, to satisfy the need for balance in the contractual relationship. The poor must be grateful and subservient or (if they are not) they must be seen to be punished to some degree. The alternative is an even greater tax backlash, which would leave the poor with no support at all. The price of maintaining a reduced or minimal welfare state appears to be some symbolic retribution.

The simple conclusion to our review of poverty and social problems in the city is that social policy makes a difference. Wider social policies provide the framework within which specific urban policies work. If urban policies are asked to do too much they will fail.

Over the past 20 years, there has been increasing attention to local economic initiatives as the way forward. As central government loosened its sense of responsibility for unemployment and social justice, so a devolution of responsibility to lower levels occurred. Broadly, the right wing wanted to devolve responsibility to family and neighbourhood, business and charities; more centre-left politicians saw a role for city governments but these are increasingly harnessed, tempered and controlled through partnerships with business.

There remain those who argue against targeting area programmes on the urban poor. Such programmes, they say, attack symptoms rather than causes and the causes must be dealt with at the macro-level. They point out that there are as many or more poor people in non-poor areas than in targeted areas and that targeted, selective programmes always stigmatize the recipients. In addition, there is always the problem of where to draw the line, posing problems for contiguous areas, which are left out of regeneration initiatives yet perhaps may be as deserving of attention.

ILO/UNDP conclude that action is needed at international/global level, national level and at regional and local level if social exclusion is to be effectively combatted (Rodgers et al., 1995). Capital may be difficult to attract to countries which impose social policy objectives (Rodgers, 1995: 268) in a context of increasing competition between countries. For national policy, the fundamental issue has to do with the extent to which, and the ways in which, the public attempts to restrain or regulate the market. The shape, extent and direction of social policy at the national level provides the crucial context within which city level policies have to work.

Partnership is now proposed as the way forward, involving the state, the market and the tertiary sector. In these new forms of social organization, a greater place is available for local initiatives and intermediate levels of decision-making. ‘The danger of this approach’, as Rodgers points out, ‘is that problems of exclusion will then be given less priority in national policy, leaving local policies as a palliative within an exclusionary model of development’ (1995: 272).

The ‘social question’ re-emerged as the twentieth century drew to a close. With the end of the Cold War, poverty, exclusion and inequality appear now to be the main reasons for instability in the world (Bessis, 1995: 11). The social crisis is increasingly urban in character and this is likely to increase in the decades of the twenty-first century.

In the view of increasing numbers of researchers, the economistic drift, the supremacy of exchange value over the notion of use value, the running of the planet according to the sole criterion of the profitability of enterprises and the extension of the cash nexus to the ensemble of human activity are in the process of pushing humanity into an impasse. (Bessis, 1995: 34)

These trends have led to a disregard of collective needs not linked to the market, the waste of finite resources and the exclusion of increasing proportions of the world’s population. Policies may be either an agent for integration or a force for exclusion. The challenge is to turn round the policies which have led to increasing poverty and disintegration in the cities and develop new ways of meeting human and social needs. For this, new political alliances and new political cultures will be required.