Redesigning urban living at scale: the case of “Red Vienna” in the 1920s

I just saw a very inspiring exhibition called Das Rote Wien, (“Red Vienna”) at the Wien Museum. I want to make a quick note of what I saw, since it relates to our reflection around The Reef.

Background: Vienna is, even today, unique. A large percentage (about 20%) of all apartments for rent in the city are owned by the municipality (Gemeinde Wien). Additionally, they are not concentrated in one or few low income areas, but are scattered all across the city. There are no ghettos in Vienna.

The foundations for this state of affairs were laid in a short period, from 1919 to 1933, called “Red Vienna”. Here is how I understand the situation:

  • The Austrian Empire loses World War 1 and much of its territory. It morphs into a federal republic and turns to socialism. Socialist ideas spread: about the dignity of man, the centrality of urban workers in society, and the role of the state in bringing about a new kind of society. The Socialist party wins a majority in the federal parliament.
  • In 1919, it loses control of the federal government, but maintains a high consensus in Vienna (about 50% of votes throughout the period preceding Austria’s assimilation into Nazi Germany). Socialists refocus on Vienna as the cradle of their utopia.
  • Meanwhile, post-war hyperinflation has swept away public debt.
  • Rent controls are established in 1917. This ends real estate speculation and leads to falling real estate prices.
  • In 1922 Vienna is separated from the rest of Lower Austria, and becomes its own state (Land). It can now levy its own taxes. This enables a radical, and very successful, fiscal policy:

These taxes were imposed on luxury: on riding-horses, large private cars, servants in private households, and hotel rooms. (To demonstrate the practical effect of these new taxes, the municipality published a list of social institutions that could be financed by the servants tax the Vienna branch of the Rothschild family had to pay.)

Another new tax, the Wohnbausteuer (Housing Construction Tax), was also structured as a progressive tax, i.e. levied in rising percentages. The income from this tax was used to finance the municipality’s extensive housing programme. Therefore, many Gemeindebauten today still bear the inscription: “Erbaut aus den Mitteln der Wohnbausteuer” (built from the proceeds of the Housing Construction Tax). (Wikipedia)

  • Red Vienna deploys substantial intellectual firepower. Socialists mobilize Freud, Adler, Popper, Gödel, Loos, Neurath and others, and offer them seats on boards of research- and policy institutions. The exhibition has an impressive visualization of the Netzwerk Intelligenz, showing how these intellectuals worked with one another in various organizations contributing to the city’s governance.

  • Red Vienna works across the policy spectrum to implement the socialist vision: education reform, social services, health care, green areas. Housing is a central concern. In fact, Viennese citizens had not been waiting around for socialist leaders to make up their minds, and had taken that matter into their own hands.

Following the war, thousands of “wild” settlers occupy land on the periphery of Vienna, where they erect simple dwellings and grow gardens for their food. Emerging from this is the cooperative-oriented Viennese settler movement. Architects and intellectuals, such as Adolf Loos, Margarete Lihotzky, and Otto Neurath see a new democratic way of living in the simplicity and functionality of settlement houses.

  • In a very creative move, the city government decides to support, rather than repress, this movement:
  • In order to guide the settlement activity and certainly also to control it politically, the municipality provides the settlers financial and technical support beginning in 1920. By 1933, roughly 8,000 settlement houses had been built in Vienna.
  • In 1923 Red Vienna moves beyond surfing the wave of the settlements movement, and rolls out a full-fledged strategy. It consists of the already mentioned Wohnbausteuer, earmarked to finance the city’s affordable, high-quality housing strategy, and of a construction plan. The latter is another innovation:

“New Vienna” is not developed as residential estates in the periphery, as is the favored practice internationally, but unstead, is integrated into the existing city in the form of several-story “people’s apartment buildings”. […] All of the rooms are furnished with windows, and all of the apartment have running water and toilets. Their rather moderate dimensions are extended by communal spaces, such as laundry rooms and baths. Until 1933 approximately 380 council housing buildings are constructed, with more than 60,000 apartments able to house 200,000 people.

So, in less than 15 years, Vienna built 60,000 apartments, plus 80,000 settlement houses. Assuming an average of 4 inhabitants per house, this means lodging 200,000 people with the New Vienna program + 320,000 people with the bottom-up settlements. This runs up to 520,000 people… in a city of 1,700,000 inhabitants!

These buildings brought about a huge increase in the quality of urban life, and in that of Vienna’s landscape. This increase was permanent: almost all lodgings are still in use today, 100 years after Red Vienna, and Vienna is always topping the charts of the most livable cities in the world. This, despite the Nazis ending Red Vienna in civil war and ultimately annexation in 1933.

It appears we have

There are so many valuable lessons in here that I do not even know where to start. Maybe it is even more interesting to consider the interplay of the various factors: preconditions like Vienna’s debtlessness  and the “plasticity” of the Austrian constitutional architecture, and therefore the city’s power to levy taxes (courtesy of losing a major war); intellectual resources (mostly inherited by imperial times); bold policy; and an impressive ability to “sniff the wind” and channel and support emergent phenomena like the informal settlements, rather than fight them back.

It would be worth looking deeper into the matter. Unfortunately many sources are available only in German. Does anyone have any insights to offer?

(Reposted from Edgeryders)

Captured: how deep the European Union lost its way on copyright

Many people, myself included, have followed with great interest the last year’s event as the European Union worked its way through a new directive on copyright, which is likely to have many negative consequences on fair use and the free flow of information on the Internet (included information that has no copyright implications). This is no place to summarize what happened: you can find many great accounts online, like the blog of Pirate MEP Julia Reda. What I found most striking is how no one who had (1) a shred of competence in Internet matters and/or economics and (2) was not set to benefit directly from it, supported the directive. Academics. Civil liberty activists. Large American tech companies. Small European tech companies. No. One. But the copyright lobby pushed really hard, as revealed by the EU lobbying registry. Out of the 25 organizations that held the most meetings on copyright with the Commission in 2018, 23 represented copyright holders (source: Corporate Europe). The vote went ahead, and the lobbyists won, as they tend to do.

Just as the battle for the final vote in April 2019 raged on, I decided to visit the House of European History in Brussels. This is a history museum with a continental perspective, set up as an initiative of the European Parliament. At some point, I got fascinated by an Italian 1930s political propaganda manifesto from the fascist era, so I took out my phone to snap a picture. A steward informed me that taking picture was not allowed.

This piqued my curiosity. Why would it not be allowed? The whole point of the European Parliament investing in this project is for as many Europeans as possible to get acquainted with their common past. Visitors taking pictures and resharing them on social media (or showing them to their families at home) are helping the House of European History fulfill its mission. So I asked the steward “Why is that, sir?”. He could not give an answer, but insisted I was not allowed to take picture. At this point, I replied that if he could not give me a valid reason to comply, I would just refuse to obey him. He went looking for his manager.

The manager was not much help. He, too, was “just obeying orders”. Ironic, I know: we were standing in the section on the totalitarian atrocities. He advised me to put a written complaint to the museum itself. So I went home, and did. And asked again my question:

The House of European History wants to showcase to Europeans their common legacy. We are Europeans, so this our legacy too. Why are we not allowed to share it with my fellow humans? In fact, why are we not encouraged to do so?

The answer came a few days later. The gist of it was this: several of the exhibits are on loan from others museums and institutions. These institutions have different copyright policies, depending on national legislation and other factors. This gives rise to such a tangle of vetos, restrictions and other hindrances that management decided to cover its back and simply forbid taking pictures of anything at all.

In the age of Instagram and Facebook, by this decision the House of European History is crippling its own communicative potential. This is stupid, coward and wasteful of European taxpayer money. And no one tell me it is “rewarding creators”: the person who had designed the fascist manifesto that fascinated me had likely been paid for his work back in 1934, and passed away since. A much better policy would be to only show exhibits that are firmly in the commons.

A month later, the European Parliament went on to approve the even more restrictive copyright directive that right holders lobbyists wanted. Never mind that copyright legislation in Europe is already so restrictive that its own projects cannot get firm traction because of it. This, I think, goes to show how deep European institutions have become lost in trying to accommodate business. Accommodating business (or anyone) is not bad in itself; but it does become bad if, to do it, you lose sight of your strategic aims.

I am a staunch European federalist, but this stuff is impossible to defend. European elections are coming up: I have pledged to outvote candidates and parties who supported this directive. If, like me, you care about this stuff, you can find more information about which candidates to blacklist on https://pledge.eu.

Photo: House of European History. Sue me.

Finance, as it should be. An innovative social investment model in Messina, Sicily

I am just back from a seminar on technology policies to improve social justice and reduce inequalities. The seminar took place in Messina, on the northeast tip of Sicily: mainland Italy was just three kilometers away, looming across the strait. It was interesting in and of itself, and it ties back nicely onto our work on the Next Generation Internet, which is just starting now. But what was most interesting was the place that hosted us, Fondazione Horcynus Orca. The place felt… utopian. Built around the ruins of a 1st-century BCE Roman watchtower/temple, maintained by ex-inmates of the local mental asylum, meeting place of people in several businesses, from a local energy company to a beer manufacturer. Something was going on. So I asked.

It turns out Messina hosts an “advanced social district” (distretto sociale avanzato). In Italian, “district” carries the idea of production; a tightly integrated network of independent companies, competing on some arenas, cooperating in others (industrial district), of which Horcynus Orca is only a piece, specializing in the arts. As I spoke to Gaetano Giunta, a physicist and member of the small group of friends who quit their jobs to start it all in the late 1990s, I heard him mention values similar to Edgeryders’s own: freedom, happiness, beauty. Business, production  and commerce are the weapons of choice, the main paths that lead to being able to uphold them sustainably.

I am only starting to study the district’s fascinating history and organizational architecture, so I will not talk about this now. But I do want to note an investment model mentioned by Gaetano that struck me as super-clever.

In 2010, activity in Messina had reached critical mass. Gaetano and his group were able to attract an largish investment, that went into the startup capital of an Italian social economy vehicle called a community foundation (fondazione di comunità). At that point, they had the problem of investing the money so that this capital would result in a revenue stream for the new foundation to do its job. They did not want to invest in financial assets, as they thought this would betray their mission of developing the local social economy. What could they do?

As they studied the problem, they realized that Italy had launched a plan of incentives to build up capacity in renewable energy generation. This was, in fact, the Italian implementation of a EU program called feed-in tariffs. Such program promised a long-term (20 years) subsidy to anyone installing solar panels or wind turbines.

So, they reached out to the community, and offered to partner up with basically everybody who asked: schools, hospitals, companies, small coops of households. Each partner would receive and steward a cluster of solar panels. The Foundation paid for the installation, and even let the partners keep the energy, to use or sell back to the grid. The Foundation itself gets to keep the subsidy. They ended up installing 2 MW of capacity. For doing all this, they spun off what they call an ESCO (Energy Social Company) called Solidarity and Energy. The ESCO then proceeded to use the foothold gained in renewables to further green the local economy, by pushing for increasing the energy efficiency of the housing stocks, and even inventing solar panels based on organic materials, like discarded oranges (!). They are low-efficiency, but super-cheap, and they come in colors (orange pulp is bright red in Sicily!), so they have a lot of potential whenever designers are involved.

Now, this is a very elegant move. In one go, they greened the economy; created a new local player who would further green it long-term; provided a tangible benefit for the local community; bought themselves a lot of goodwill; and turned a lump of “dead” money into a 20-years guaranteed revenue stream. Finance, as it should be!

My intention is now to spend a week or so in Messina, and really understand how they do it, also as inspiration for the future Reef.

I think I can swing hospitality for a few people, if I ask nicely and if we are ready to give back, for example organizing a small event on new co-operativism and post-capitalist enterprise. Also, they eat like gods. Is anyone interested?

Reposted from Edgeryders