In Joesph E. Striglitz chapter, “Globalism’s Discontents,” he argues that “globalization has meant different things in different places.” Why have some countries been able to use tools and trade afforded by globalization to the benefit of many, while other countries have seen increases in poverty and exploitation? Striglitz writes that “the most successful globalizing countries determined its own pace of change,” while countries that encountered more negative symptoms of globalization were pushed too quickly by the IMF and World Bank to embrace rapid privatization and liberalization while also getting the short end of trade deals and unstable investments.
Striglitz specifically points to speculative real estate booms that result in economic devastation when money is pulled out by investors or public consumption does not align with perceived demand. I am reminded of the phenomenon of China’s “empty” or “ghost” cities, which are large cities constructed by government & developed with the intent of filling perceived demands of the middle class — but to date, many of these cities remain relatively empty.
One city in particular, Kangbashi, was built to house more than a million people. Instead, only about 100,000 live there. It was built during a economic up-turn as a result of mining boom; in order to supply perceived demand, and to cater to an middle-upper class that was perhaps not as stable as thought, the city boasted giant shopping malls, upscale condos, giant public squares, and impressive skyscrapers that all stand nearly unused. Another ghost city replicated tourist attractions from around the world, including Versailles fountains, an Eiffel tower replica, a yellow brick road, Alice in Wonderland larger-than-life sculptures and amusement park rides — taking a more Dubai-directed approach to concentrating elite consumption in specific, encapsulated places.
Is this urban planning that will eventually pay off as the Chinese middle and middle-upper class grows, or is it a state-sanctioned speculative real estate bubble that will eventually burst?