Daily Archives: November 25, 2010

In Defence of (a certain kind of) Gentrification

Any serious discussion about alleviating poverty has to acknowledge the primary role that economic development plays in the solution. There is no city on this planet, no village, no town where poverty has been permanently alleviated without the benefit of sustained economic development.

At the dawn of the 19th century, almost everyone living on this earth was poor. Now, most are not. That there are unfortunate places where poverty still persists on a large scale is a direct result of the lack of economic development. This is true regardless of the reason that economic development did not take hold. That Hamilton’s economy is in shatters and that there are too many poverty stricken neighbourhoods in Hamilton is no coincidence.

World-renowned poverty activist and economist Jeffrey Sachs (founder of the UN Millenium Project chaired by President Jimmy Carter) made this point in his seminal 2005 book “The End of Poverty”:

“Since all parts of the world had a roughly comparable starting point in 1820 (all very poor by current standards), today’s vast inequalities reflect the fact that some parts of the world achieved modern economic growth while others did not”

Economic growth is a prerequisite to poverty alleviation and that means business.

Capitalism is Capitalism and Capitalism is bad

Not true. First, Capitalism is not Capitalism – a locally owned and operated organic, fair-trade coffee-shop business can hardly be compared to Monsanto or Starbucks or Google or any other large corporation. Second, notwithstanding all its imperfections, Capitalism is not inherently evil (nor is it inherently good). Capitalism is a human construct and it ought to serve mankind, not the other way around. So we should fight to restrain and reform capitalism but unless and until we invent a better system (we have not), we need to work with capitalism and make it work for us. No political-economic system is going to be perfect, but living in one of the most successful capitalist democracies in the world should convince even the most wary.

Gentrification is Gentrification and Gentrification is bad

Also not true. The absolutely necessary economic development of Hamilton’s downtown core will lead to “gentrification” of one sort or another. But gentrification happens far more gradually than its detractors suggest. The James St. North neighbourhood is slowly, painfully slowly, experiencing some much needed economic growth. The first wave of economic development is essential and good, as well intentioned local entrepreneurs make risky investments because they want to improve the lot of the area – and yes, they hope to make a profit in doing so. They create much needed jobs and attract more businesses to the area. This attracts more people to the area and makes it safer to live and work in – and a virtuous cycle begins. This is the kind of economic development or ‘gentrification’ we should be striving for. This is the kind that has dragged millions of people out of desperate poverty all over the world.

The last wave (what I would call gentrification) is not good. Large profit maximizing corporations enter without particular regard for the people, community or other businesses in the area. Which sort of gentrification we accept and how we control it is worthy of serious discussion.

But economic development does cause disruptions. Rents will rise and some people will be forced to move. Business owners will ask panhandlers to move away from their front door. Earlier generation businesses will sell and retire. New businesses will take their place. The character of the neighbourhood changes. This new reality has to be compared to the current reality – that of a stagnant (or worse) economy with little hope for the poor who live there – or elsewhere in the downtown core. Without economic development the poor are condemned to remain poor.

In opposing “gentrification”, activists ought to be careful not to allow ignorance (of the real solutions to poverty) to cause tragic grief and pain to the very people they claim to be representing.