What is the relationship between local participatory spaces and global capitalism? In this chapter, I begin the analysis of this relationship by examining how political-economic conditions shape the boundaries of participatory spaces. Porto Alegre, Brazil, has been especially prone to become subject to idealistic projections of democratic innovation and resistance to global capitalism. Excessively radical claims have in turn generated criticism from skeptics that have often been equally unnuanced. I will argue, by contrast, that participatory spaces are both constrained and enabled by structural conditions of urban capitalism. Even in Porto Alegre, local policymakers’ need to balance between contradictory interests shaped the boundaries of participatory budgeting. They needed, at the same time, to gain the support of local civil society, the votes of broad groups of citizens and the cooperation of powerful businesses. To understand the interests involved in the politics of participation is a necessary first step of analyzing how citizens can renegotiate the boundaries of participatory spaces.