The emergence of “Stadtumbau Ost”

ABSTRACT

Academic discussions often refer to the German urban development program “Stadtumbau Ost” [Urban Regeneration East] as a showcase example of proactive policies on urban shrinkage. The paper discusses how this program came into being. Based on expert interviews and document analysis, it demonstrates that the primary cause for “Stadtumbau Ost” was not so much a new development policy for depopulated cities, but rather an attempt to manage tackle an acute crisis of large housing companies. These exerted enormous influence on policy-making and made sure that new policies were designed in a way that would benefit their interests. At the same time, the new program was based on established federal funding policies which made the integration of planning principles vital. The outcome is a hybrid, combining a market shakeout with visions of sustainable planning.

KEYWORDS:

• Shrinking cities
• decline
• regeneration
• urban policy

Acknowledgements

I am indebted to the interviewees for their time and engagement with my study. I am most grateful to XXX (Ref deleted) for their encouraging and insightful comments on earlier versions of this paper. Thanks also to two anonymous referees for their comments and suggestions.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1. The concept of “soziale Marktwirtschaft” (social market economy, for an overview please see Bonefeld, 2012) has been a basic orientation for economic policies since the foundation of the Federal Republic of Germany in 1949 and fixed in a number of constitutional requirements. In general, it emphasizes public efforts directed at making sure the market can work efficiently. Here, the focus is on temporary amelioration, as well as on managing a “healthy” balance between economic principles and social goals. From this perspective, state intervention is justified by market failure—but it has to be designed in a way that makes it subsidiary to the market economy. A second core idea underlying German political culture is a somewhat loose form corporatism, that is, an orientation that seeks the representation and accommodation of conflicting interests in political and policy compromises based on common interests.

2. It should not go unnoticed that this perspective has also been subject to strong critiques. Thus, it has been argued that models which frame the policy process as evolving through a sequence of discrete stages are empirically inaccurate, that they don’t provide causal explanations, and, consequentially, that applying these models would lead to an oversimplified and unrealistic view of an essentially complex world (for an overview please see Jann & Wegrich, 2007). Although there is broad consensus among Political Scientists that most of these critiques are reasonable, stage-models of the policy-process nevertheless keep being used, mostly because they provide reliable heuristic templates. Their major advantage is in fact their simplicity, and as long as it limitations are kept in mind, they work well for enabling a first entry into the complex and fluid settings of any policy-process. It can thus be argued that as long as the limitations are kept in mind, stage models can serve as an easy-to-handle orientation which helps to organize the necessarily confusing material collected on any policy process.

3. Major findings of this project are discussed in a Working paper by XX (Ref deleted).

4. The political economics of this bizarre housing boom in low-demand situation have yet hardly been studied and the majority of contributions are only available in German. First insight can nevertheless be gained from a short intervention I have published in 2006 (Ref deleted).

5. The background to this law was the transformation of the formerly socialist housing sector into a market economy. In this context, state funds from the GDR state bank which were allocated to municipal housing administrations and cooperatives from the government of the GDR through a monetary system similar to other socialist economies became real “debts”(Bernt, 2006; Borst, 1996)

6. “Basel II,” a global, voluntary regulatory framework for banks which included minimum capital requirements, tougher supervision, regulations for assessment sharing, and new disclosure procedures had just been in the making and was finally introduced in 2004.

7. In Germany, the interests of housing companies are represented by three different lobby-organizations at the national level. In this context, “GdW” represents municipal and cooperative companies (which have most of their stock in large-scale housing estates), whereas “Haus&Grund” stands for small landlords who often only own one or two properties. “Bund Freier Wohnungsunternehmer” is more closely connected to the interests of proprietors and real estate speculators. Among these three organizations, “GdW” is traditionally the organization with the best connections to federal and state governments.

8. Altogether, the competition immensely contributed toward making an urban planning perspective more central. In retrospect, there are two reasons for this. On the one, hand the setting up of new masterplans for next to every city in East Germany practically worked like a massive employment scheme for architects and planners. Most of the plans were written by planning offices, so that the perspectives central to these professions necessarily gained more weight. On the other hand, the process of setting up the new plans was accompanied by the provision of detailed guidelines and expert reports on central issues (e.g. on regional visions, on strategies for historic neighborhoods, on the adjustment of technical infrastructures, on intermunicipal cooperation, on matters of preservation…). All these guidelines were mainly set up by a specific working group at the national level which was led by Michael Bräuer, an architect and planner from Rostock who had worked as a state secretary for the last GDR-government and was widely known in eastern Germany.

9. This shift was, however, made easy by a strong cultural preference for heritage protection and inner-city living which is characteristic for Germany’s planning culture in general.