ABSTRACT
Introduction Since 2007 the Spanish economy has faced the worst financial and economic crisis of the past 50 years. The effects of such a deep recession are well known: growth in unemployment, intensification of public debts, an increase of poverty and inequality, the rise of socio-economic divides, loss of trust in institutions, and political discontent. These consequences become dramatically visible in cities. The turmoil generated by the global financial system, limitless and unregulated since the 1980s, alongside the specific deficits of the Spanish institutional framework, such as its support of a growth model based on residential construction (Romero, Jiménez, & Villoria, 2012), ineffective accountability mechanisms, low-quality local and regional government institutions (Lapuente, 2009), flexible and discretionary land-use legislation (Iglesias, 2007), and a growing need for revenue at the local and regional levels of government (Fernández, 2008), have led to an unparalleled crisis. Following the trend in other parts of the world, such as Latin America and the United States, where financial markets had also been deregulated three decades earlier, Spain joined the group of countries that received a huge amount of financial capital injected into the home building industry in a scenario of abundant global liquidity. The socialist government of Rodríguez Zapatero (2004-2011) was unable to pave the ground for a way out of the crisis, based on a different and distinctive model. When the situation seriously deteriorated, he was compelled to accept a series of social cuts following the neoliberal paradigm. This led to the worst electoral defeat of the socialist party in the democratic era, and to the absolute majority of the conservative party in the 2011 elections. National, regional, and local conservative governments have thereafter backed a series of measures responding to a clearly defined political strategy: a great reduction in social public spending, privatisation of the welfare state, and a major boost for political recentralisation processes. In this chapter, the scope and the outcomes of these measures are analysed. Particular attention is paid to the effects they have had on the Spanish urban and metropolitan regions of Madrid and Valencia, where the conservative
governments have been hegemonic for two decades at both the local and regional levels. Although there are other soft versions of the neoliberal city, namely Barcelona and Bilbao (Capel, 2003; Borja, 2010; Cucó, 2013b), there is consensus among academics that Madrid and Valencia represent paradigmatic examples of neoliberal thought applied to city administration (Rodríguez, García, & Muñoz, 2013). The chapter proceeds as follows. First, the ‘neoliberal turn’ in Spanish city policy is explained, with a focus on its implications for urban development and the social divide in Spain and in both case studies, Madrid and Valencia. The application of the neoliberal model of urbanism is illustrated through an analysis of these two urban and Metropolitan Areas. The consequences that neoliberal strategies have had for these cities are assessed. Finally, recommendations that could be further developed into an agenda for both studied cases are summarised.
