Metropolitanization, Globalization and Governance – New Regionalism, Old

Regionalism or No Regionalism in Israel

Eran RazinDepartment of Geography, The Hebrew

University of Jerusalem

IMO – Montreal, April 24-25 2006

The Argument

• An assumed link: metropolitanization processes in an era of globalization and pressures on the welfare state lead to ‘new regionalism’ forms of governance.– New regionalism – complex horizontal networks, partnerships,

ad-hoc coalitions and modes of cooperation in a competitive economy.

– ‘Old regionalism’ – a focus on reforming formal hierarchical administrative-territorial structures.

– No regionalism• Public choice – competition within a fragmented pattern.• Centralization – prominence of upper levels of government

diminish the significance of debates over local and metropolitan governance.

• A move ‘from government to governance’ – partnerships, cooperation, networks – does not imply a diminishing role of the central state and of territorial hierarchical structures, but rather a more pluralist mode of decision making – changing “rules of the game”.

• The central state practically backs-off from fulfilling some of its responsibilities, but does not cede its legal powers.

• Seemingly ‘new regionalism’ attributes of governance can in fact serve as tools of central control, in an environment of a neo-liberal move towards privatization associated with centralization.

However….

• New regionalism evolved in Israel only to a limited extent, ‘old regionalism-type’ reforms hardly ever took-off. Thus, the main direction of change has apparently been from a centralized version of ‘no regionalism’ to a slightly more decentralized version of ‘no regionalism’ with some components that can be regarded as new regionalism.

The Global Context

• The crisis of the welfare state– Pressures on the welfare state: globalization, etc.

– Political-ideological responses.

• Implications on local/metropolitan governance– Urban entrepreneurialism, privatization, NPM.

– A move from ‘old regionalism’ to ‘new regionalism’.

• Reservations on the assumed shift from government to governance– Major territorial reforms.

– Critique on the neglect of the central state in the urban regime, urban entrepreneurialism and new regionalism literature.

– Crisis conditions: a window of opportunity to impose reforms.

• The rise of the post-welfare state can lead metropolitan governance in diverse paths– Decentralized horizontal networks.

– Centralized imposed/encouraged from above networks of governance.

• Erosion of the welfare state and the crisis of (local) democracy– Declining turnout, fragmentation, limited participation in civil society.

– Possible influences of new regionalism: lower accountability? From majority decisions to deliberative democracy?

Metropolitan implications

The Israeli Context

• Cycles of growth and recession.

• The rise of urban entrepreneurialism, 1980s-1990s.

• The Israeli type of decentralization:– The emergence of the courts as a major arena for societal conflicts.

– The act of the state as several stakeholders.

• Recession and crisis of the early 2000s serves also as a window of opportunity to impose changes on the local government system.

Higher Education: Diminishing or Changing Role of Central InterventionGillad Rosen and Eran Razin

• Regulation and support a monopoly of the central government through the Council of Higher Education.

• Early 1990s – the system opens for the establishment of new colleges; local authorities compete of their location, despite being formally excluded from the system.

• Growing municipal entrepreneurialism does not indicate diminishing central state regulation but changing nature of central intervention:

– Greater pluralism and exposure to external pressures from both private and and public sectors.

– Politicization: growing intervention of politicians of the central state. Erosion of power of bureaucrats/professionals at the Council of Higher Education?

– A problem of over-investment and unwillingness of local authorities to cooperate, except occasionally in weak peripheral regions.

Joint Planning Commissions: Coordination, Cost Savings or Central ControlMichal Dachoach-Halevi and Eran Razin

• An institutional framework established in the 1950s: cooperation imposed from above, intended to achieve coordination and economies of scale.

• Prevailing cooperation in practice: “don’t meddle in my affairs and I will not interfere in yours”.

• Economies of scale – likely only when very small local authorities are involved.

• Tool of control:– An effective tool for intervening in local planning decisions

(particularly of Arab local authorities) in the past.– At present, mainly provides opportunities for centrally imposed

appointments.

Joint Industrial Areas and Tax Base Sharing: A Local Initiative Transformed and Utilized by the Central State

Eran Razin and Anna Hazan

• Emerged on the agenda as a result of the growing share of self-generated revenues in local government finance in the late 1980s, and of the substantial cuts in central government transfers in the early 2000s.

• Non-residential local property tax (Arnona) – a major source for fiscal disparities.

• The breakthrough in 1992 – an outcome of local initiative of two mayors.

• Supportive attitude of the Ministry of Interior. The Ministry of Industry and Trade provides support in priority zones after 1997, as a tool to rationalize investment in infrastructure and to market land in industrial parks.

• 2000 – An amendment to the Local Government Law enables the Ministry of Interior to approve agreements for sharing local taxes and levies on non-residential land uses.

• Early 2000s – Attempts of the Ministry of Interior to impose revenue distribution face substantial difficulties.

• 2003-2006 – Support of the Ministry of Industry and Trade ceases due to lack of funds. Public incentives provided to encourage cooperation between Arab and Jewish local authorities.

• 2004 – A Ministry of Interior appointed commission examines the option to redistribute a portion of non-residential property tax. A negative recommendation also because of mistrust in the Ministry of Finance.

• Mid 2000s – Mechanism adopted by the national Planning Administration. Land use plans can require inter-municipal cooperation and revenue distribution as preconditions for approval of industrial and commercial uses.

• 2005-2006 – Proposed amendment to the law enables the Ministers of Interior and Finance to impose revenue redistribution among adjacent (but not necessarily bordering) local authorities.

• In sum, a ‘new regionalism’ local initiative, at first gains the support of the central state, then adopted by the central state to impose policies in line with its own agenda: sustainable planning? distributive justice? Budget cuts?

• The desirable limits to central control: ‘gentle imposition’ subject to clear checks, attempt to retain an image of a fair broker; or bitter conflicts, decisions motivated mainly by a desire to solve short-term budgetary problems of the central state.