Untitled - Rebel Studies Library

80 PLANET OF SLUMS
shortage of property rights. By waving the magic wand of land-titling,
de Soto claims, his Institute for Liberty and Democracy could conjure
vast pools of capital out of the slums themselves. The poor, he
argues, are actually rich, but they are unable to access their wealth
(improved real estate in the informal sector) or turn it into liquid
capital because they do not possess formal deeds or property titles.
Titling, he claims, would instantly create massive equity with little or
no cost to government; part of this new wealth, in turn, would supply
capital to credit-starved micro entrepreneurs to create new jobs in the
slums, and shantytowns would then become "acres of diamonds."
He speaks of "trillions of dollars, all ready to put to use if only we
can unravel the mystery of how assets are transformed into live
capitaL"32
Ironically, de Soto, the Messiah of people's capitalism, proposes
little more in practice than what the Latin American Left or the
Communist Party of India (Marxist) in Kolkata had long fought for:
security of tenure for informal settlers. But titling, as land-tenure
expert Geoffrey Payne points out, is a double-edged sword. "For
owners it represents their formal incorporation into the official city,
and the chance to realize what may be a dramatically increased asset.
For tenants, or those unable to pay the additional taxes that usually
follow, it may push them off the housing ladder altogether." Titling, in
other words, accelerates social differentiation in the slum and does
nothing to aid renters, the actual majority of the poor in many cities.
Payne warns that it even risks "the creation of a large underclass that
is denied access to any form of affordable or acceptable housing."33
Peter Ward confirms that titling - or rather, "regularization" - in
Mexico City has been a mixed blessing for colonos. "It is not simply a
means of extending full property titles to the poor, but increasingly a
means of incorporating them into the tax base." The benefits of being
able to use homes as legal collateral are counterbalanced by a new visibility
to tax collectors and municipal utilities. Regularization also
undermines solidarity within the colonias by individualizing the struggle
32 Hernando de Soto, TheMystey of Capital.- W0 Capitalism Triumphs in the West and
Failr Everywhere Else, New York 2000, pp. 301-31.
33 Geoffrey Payne, unpublished 1989 report, quoted in Alan Gilbert and Ann
Varley, Landlord and Tenant: Housing the Poor in Urban Mexico, London 1991, p. 4.
ILLUSIONS OF SELF-HELP 81
for housing and by giving titled homeowners interests that differ from
those of other slum residents. "Renters, harassed squatters, displaced
downtown tenants," argues Ward, "are likely to be more radical and
disposed to anti-government demonstrations than are those who have,
in effect, been bought-off by the government through successive
housing policies."34
This has even been the case in Sao Paulo, where Workers' Party (PT)
administrations, starting in 1989, have tried to regularize and upgrade
the "huge illegal city" of the poor. Although the PT's reforms have
produced some admirable results, Suzana Taschner, who has carefully
studied the local impact, points to negative repercussions as well:
"Unfortunately, with the upgrading, the real estate submarket consolidates
in the favela. Both land and houses become consumption goods
and the price soars." One result is the emergence of what Taschner
calls the "slum within the favela," as squatters' homes are replaced by
shoddy cortifos (tenements) renting single rooms to the poorest of the
poor.35 Without decisive public intervention in real-estate markets, in
other words, titling by itself is hardly an Archimedean lever to raise the
fortunes of the great mass of poor urban dwellers.
However, de Sotoan panaceas remain immensely popular for obvious
reasons: the titling strategy promises big social gains with a mere act of
the pen and, thus, pumps life back into the World Bank's tired self-help
paradigms; it accords perfectly with dominant neoliberal, anti-state
ideology, including the Bank's current emphasis on government facilitation
of private housing markets and the promotion of broad home
ownership; and it is equally attractive to governments because it
promises them something - stability, votes, and taxes - for virtually
nothing. "The acceptance of unauthorized settlements," Philip Amis
points out, "is a relatively painless, and potentially profitable, way to
appease the urban poor in the Third World."36 And, as geographers
Alan Gilbert and Ann Varley emphasize in the case of Latin America,
it is also a classical conservative reform: "The very nature of the selfhelp
housing process has ... contributed to political placidity.
34 Ward, Mexico City, p. 193.
35 Suzana Taschner, "Squatter Settlements and Slums in Brazil," in Aldrich and
Sandhu, Housing the Urban Poor, pp. 216-19.
36 Amis, "Commercialized Housing in Nairobi," p. 237.