From ‘Star Projects’ to White Elephants: The Changing Rules for Urban Development in Spain

On September 24, 2008, the Zaragoza International Exposition closed its doors leaving an 8 million euro deficit with the state-owned company EXPOAGUA Zaragoza 2008. However, the company was also left with the satisfaction of having sparked one of the most impressive transformations in any medium-size Spanish city. Because of the event, the city practically renewed its entire infrastructure; created new spaces for fairs and conventions; constructed a new airport; and built new, iconic buildings designed by renowned architects. “Zaragoza went to bed with the feeling of having available all of the elements for success that were listed in urban management and city marketing manuals,” writes Gildo Seisdedos, professor of marketing and Madrid Global Chair of international urban strategies at the IE Business School and director of the Urban Management Forum, in a recent research report. “The only thing left was the pulsar effect: an explosion of success.” Nevertheless, just one day later, on September 25, the world had to direct its attention to the bankruptcy of Lehman Brothers. Zaragoza “had just realized that for it — as with cities in general — things had just changed in a radical way,” says Seisdedos.

In recent months, Seisdedos has met with managers of Spain’s major cities with the goal of launching mercoCIUDAD 2008, which ranks by sector those better-known cities in Spain that have more than 75,000 people. According to Seisdedos, in Zaragoza “we had the feeling that when we managed to reach our goal, the rules of the competitive game had changed on us…. [What] worked months ago no longer works.”

What were considered “star” urban projects just a short time ago have become, over night, white elephants, Seisdedos notes in his study. “These urban white elephants range from iconic buildings to events on a global scale. Until now, a city without a white elephant was not a city to take seriously; it was not governed by managers with vision and ambitious.” (In ancient Siam, the more white elephants the king had, the higher his status was. Nevertheless, legend says that when the kings of what is now Thailand were not happy with a subject, they gave away one of these animals. The food and access they gave to those who wanted to venerate this sacred animal could wind up ruining those who received this gift. As a result, the expression “white elephant” has been used in other languages to describe “possessions that have a maintenance cost higher than the benefits that they bring, or those that provide benefits to others but which cause problems only to their owner.”)

Seisdedos notes that nowadays, people who are alarmed by the economic crisis are more and more critical of star projects and question the benefits that come from them. This new sensitivity, he explains, creates a dilemma about going forward with these projects, or pulling back while there is still time. The danger, he says, is that people perceive these projects as “bulimic white elephants.” There could also be a political price to pay in May 2011, when the entire country participates in municipal elections. So in his study, Seisdedos asks: What kind of urban policies does this new situation call for?

Unsustainable Model of 2007

Currently, cities are governed by mayors who won elections with programs developed in 2007, when urbanization was the engine of the Spanish economy and municipal finances. It was an era in which, Seisdedos notes, people could already “smell” the end of the cycle, and there was a certain sense of saturation. But that was not an obstacle for the exponential growth of white elephants such as thematic cities, eco-neighborhoods, and conventions. All of this was adorned with new light rail “and irrigated with generous policies of public urban diplomacy, city marketing and economic marketing,” that were aimed at putting these cities on the map.

In 2007, this model “apparently” functioned, Seisdedos notes in his study. “The ultimate result was ugly cities that were environmentally unsustainable, filled with houses of fantastic dimensions: mortgages — in both the real and figurative sense — that were painful and laborious to digest.”

Now this model has become unsustainable because, from the financial point of view, “land is not an economic resource for our cities, and certainly will not become one again for about forty years.” On the other hand, “cities suddenly have very different demands: less ambition; less concern about putting my city on my map; fewer iconic buildings, and more solutions to their problems, also on a local level.” As a result, Seisdedos warns that it would be “a fatal mistake” to dedicate funding that is not directly tied to maintaining the competitiveness of the city, or for caring for the social needs that the crisis is generating.

Masculine and Feminine Thinking

To deal with this new situation, Seisdedos notes that it is important to establish a model that helps us understand the transformations that are taking place. Until now, the working model, he says, was based on stereotypes associated with masculinity and judicial ethics. That is to say, there was ambition to make star projects that were focused outwardly, and communicated on a global scale. Next to this model, a new model is emerging that “has a more feminine style based on the ethics of caring: urban policies that are less aggressive and ambitious.” This is the city seen from a mother’s viewpoint, he says.

While judicial ethics derives from the premise of equality – everyone must be treated equally – the “ethics of caring” is based on the proposition of trying not to hurt anyone. Seisdedos says that traditional urban public policy considered it immoral to be partial to any party, but this brings with it the risk of falling into authoritarianism. In other words, it is not necessary to consult with anyone because impartiality takes into account every possible perspective. On the contrary, the ethics of caring considers it important to know everything possible about the population, as well as to attend to its specifics and its context. As a result, he explains, municipal officials must put themselves in the shoes of the citizen, not in a hypothetical or imaginary way. Instead, they “must establish a genuine dialogue with each one of them.”

Seisdedos believes that, given the way economic conditions have evolved, and because of the growing vulnerability of the population, people are going to view white elephants more as a burden than as a cause of pride or happiness. He warns, “If stars have been transformed into elephants, there is a high political risk and growing ability to convert them into an element of social mobilization.”

Trends toward Change

Seisdedos identifies five trends in those cities that have realized that change is taking place and are trying to turn that change in their favor:

1. “Don’t abandon yourself to nostalgia and melancholy. Instead … assume that people’s needs have already changed.” 2009 is the last opportunity for a city to plan for something new and interesting for 2011 (elections), he says.

2. Establish a careful process for monitoring the population and, if you already have such a process, analyze changes and compare them with the cities that you consider models for competitiveness.” In this sense, he writes, it is fundamental to identify groups of people who are targets of urban policies. In addition, he recommends being as careful about companies as you are about your fellow citizens.

3. “Communicate from the first moment you have the new paradigm in mind.” The change in people’s perceptions, he explains, is going to require a relocation of resources from urban hardware (designing buildings, cultural centers and sports arenas, for example) into softer policies than can be encompassed in two large groups. First, there are the social and welfare support policies, such as the training and professional recycling of people; active employment policies at a local level; the social integration of groups that are at risk of exclusion; and policies to reconcile work with family life. A second group of policies are oriented toward improving the competitiveness of the city. As a result, this means promoting the city in an efficient and sensitive way; feeding the existing business community; stimulating the creation of new companies; and attracting investments built around clusters.

In contrast to traditional city marketing based on large-scale moves – classically in such sectors as tourism and attracting investment – new focuses are emerging based on urban public diplomacy and the integration and creation of networks. In some cases, he recommends promoting companies through the establishment of strategic alliances with international organizations.

4. “Information technologies and digital marketing are other allies that our cities should explore.” He recommends the use of blogs, virtual communities and social networks like Facebook. The municipalities of 2011 “all need to … use these types of tools. Two reasons point to that: the upcoming elections, where the concept of community requires less interpretation, and the diversity and scarcity of resources can generate a great leap forward in innovation. And, in addition, the degree of progress and maturity in the information society will then provide the necessary critical mass.”

5. “From that point on, work within the new model for the city of 2011.” Seisdedos recommends using the Urban Development Strategy, a tool recognized on the international level. In his opinion, “it is ideal for supporting the schematic vision of the city that only emerges after rigorous analysis, and which few cities have now.” He explains that this tool has already provided support for the spatial and strategic planning of Spanish cities, and that it plays a key role in coordinating these two aspects.

These tools “make it possible to connect vision with action: They define the future positioning of the city from a strategic perspective. However, at the same time, they also encompass concrete actions that, like urban acupuncture, enable people to tackle the principal kinds of actions that the municipality especially needs.” This has an advantage in that the city clearly knows where it has to arrive, and it becomes a roadmap for action on the part of the government “in the basic skeleton that guarantees the always-difficult process of coordination.”

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