Have big cities had their day?

By Rory Sutherland, The Spectator


About 15 years ago I noticed a few surviving chattel houses in Barbados and wondered what they were. As it turns out, they were an ingenious solution to an age-old problem. These tiny yet exquisite buildings, with barely room for a bed, chair and stove, owe their origins to the abolition of slavery. Though a plantation owner was obliged to pay a wage to freed slaves, he retained ownership of the land. A form of pseudo-slavery emerged, where workers were charged rent more or less equal to their pay (like workers under 30 in London). The ingenious response was to build houses light enough to be portable. You could then carry them to nearby land where rent was lower.


Alastair Parvin (of WikiHouse) and I recently coined the phrase ‘techno--Georgism’ to describe anything which limits the extractive power of landlords, in a nod to the 19th-century Georgist movement (named after the economist Henry George). The central Georgist principle is that any business or lifestyle which depends on a given location for its activity ultimately falls victim to the rapacity of its landlords. If you don’t believe this, consider airport retail, where it is hard to find sunscreen at Terminal 5 because store space is affordable only to purveyors of high-margin poncery. Or think of the two-income household, which has often raised house prices more than living standards.


Georgism was and is a sensible idea. But since in nearly 150 years governments have failed to implement its principles, it falls to technology to deliver them. The agglomerative effects of a global knowledge economy make Georgist tech even more valuable. Without it, the vast wealth produced in global clusters will continue to end up in the pockets of landowners and their running-dog lackeys in the financial sector.


Some technology is anti-Georgist. Air travel, for example, may be unhealthily agglomerative, since the nature of its network creates a winner-takes-all effect for uber-connected hub cities. By contrast, videoconferencing is hugely disagglomerative, since it weakens the relationship between an activity and its location.


Until 2020, the internet had dis-agglomerated consumer consumption much faster than it had the world of work. The best bookshop in Britain is no longer in London, it is online. Netflix offers the same films to people in Harpenden as in Hampstead. But two things maintained the siren lure of the big city: social life, which depended on crowded spaces, and well-paid work, which required extreme colocation. Both have taken a hit from Covid and Zoom.


Pandemics are naturally disagglomerative. In the end, the only advantages London offers over, say, Guildford, are in its crowded spaces: theatres, clubs, conferences, parties. London does crowded things better. (The only exceptions are pubs — much nicer in the country — and wife-swapping parties, which for some reason benefit from a suburban vibe.)


Yet on every other dimension, London loses. Without its hordes, London is merely the inconvenient alternative to Amazon. London landlords need to worry that the Covid-Zoom duo may turn out to be the 21st-century chattel house. Bankers need to worry more, since 80 per cent of lending funds rent-seeking property purchases rather than productive economic activity. Any technology that disrupts this racket is performing a valuable service for the rest of us.


This explains why I like remote working so much: it appeals to my dualism. I can be engaged in remunerative capitalistic activity within minutes of getting up — all the while knowing that, like those freed slaves, I am also sticking it to The Man.

Rory Sutherland
WRITTEN BY Rory Sutherland

Rory Sutherland is vice-chairman of Ogilvy Group UK. He writes The Spectator's Wiki Man column.