Fire in the Hole

How India's economic rise turned an obscure communist revolt into a raging resource war.

View a photo essay on India's hidden war

The richest iron mine in India was guarded by 16 men, armed with Army-issued, self-loading rifles and dressed in camouflage fatigues. Only eight survived the night of Feb. 9, 2006, when a crack team of Maoist insurgents cut the power to the Bailadila mining complex and slipped out of the jungle cover in the moonlight. The guerrillas opened fire on the guards with automatic weapons, overrunning them before they had time to take up defensive positions. They didn't have a chance: The remote outpost was an hour's drive from the nearest major city, and the firefight to defend it only lasted a few minutes.

The guards were protecting not only $80 billion-plus worth of mineral deposits, but also the mine's explosives magazine, which held the ammonium nitrate the miners used to pulverize mountainsides and loosen the iron ore. When the fighting was over and the surviving guards rounded up and gagged, about 2,000 villagers who had been hiding behind the commando vanguard clambered over the fence into the compound and began emptying the magazine. Altogether they carried out 20 tons of explosives on their backs -- enough firepower to fuel a covert insurgency for a decade.

Four and a half years after the attack in the remote Indian state of Chhattisgarh, the blasting materials have spread across the country, repackaged as 10-pound coffee-can bombs stuffed with ball bearings, screws, and chopped-up rebar. In May, one villager's haul vaporized a bus filled with civilians and police. Another destroyed a section of railway later that month, sending a passenger train careening off the tracks into a ravine. Smaller ambushes of police forces on booby-trapped roads happen pretty much every week. Almost all of it, local police told us, can be traced back to that February night.

The Bailadila mine raid was one of India's most profound strategic losses in the country's protracted battle against its Maoist movement, a militant guerrilla force that has been fighting in one incarnation or another in India's rural backwaters for more than 40 years. Over the course of the half-dozen visits we've made to the region during the past several years, we've come to consider the attack on the mine not just one defeat in the long-running war, but a symbolic shift in the conflict: For years, the Maoists had lived in the shadow of India's breakneck modernization. Now they were thriving off it.

Only a decade ago, the rebels -- often, though somewhat inaccurately, called Naxalites after their guerrilla predecessors who first launched the rebellion in the West Bengal village of Naxalbari in 1967 -- seemed to have all but vanished. Their cause of communist revolution looked hopelessly outdated, their ranks depleted. In the years since, however, the Maoists have made an improbable comeback, rooted in the gritty mining country on which India's economic boom relies. A new generation of fighters has retooled the Naxalites' mishmash of Marx, Lenin, and Mao for the 21st century, rebranding their group as the Communist Party of India (Maoist) and railing against what the rebels' spokesman described to us as the "evil consequences by the policies of liberalization, privatization, and globalization."

Although it has gotten little attention outside South Asia, for India this is no longer an isolated outbreak of rural unrest, but a full-fledged guerrilla war. Over the past 10 years, some 10,000 people have died and 150,000 more have been driven permanently from their homes by the fighting. Prime Minister Manmohan Singh told a high-level meeting of state ministers not long after the Bailadila raid that the Maoists are "the single greatest threat to the country's internal security," and in 2009 he launched a military surge dubbed "Operation Green Hunt": a deployment of almost 100,000 new paramilitary troops and police to contain the estimated 7,000 rebels and their 20,000-plus -- according to our research -- part-time supporters. Newspapers run stories almost daily about "successful operations" in which police string up the bodies of suspected militants on bamboo poles and lay out their captured caches of arms and ammunition. Many of the dead are civilians, and the harsh tactics have polarized the country.

It wasn't supposed to be this way -- not in 21st-century India, a country 20 years into an experiment in rapid, technology-driven development, one of globalization's most celebrated success stories. In 1991, with India on the brink of bankruptcy, Singh -- then the country's finance minister -- pursued an ambitious slate of economic reforms, opening up the country to foreign investment, ending public monopolies, and encouraging India's bloated state-run firms to behave like real commercial ventures. Today, India's GDP is more than five times what it was in 1991. Its major cities are now home to an affluent professional class that commutes in new cars on freshly paved four-lane highways to jobs that didn't exist not so long ago.

But plenty of Indians have missed out. Economic liberalization has not even nudged the lives of the country's bottom 200 million people. India is now one of the most economically stratified societies on the planet; its judicial system remains byzantine, its political institutions corrupt, its public education and health-care infrastructure anemic. The percentage of people going hungry in India hasn't budged in 20 years, according to this year's U.N. Millennium Development Goals report. New Delhi, Mumbai, and Bangalore now boast gleaming glass-and-steel IT centers and huge engineering projects. But India's vast hinterland remains dirt poor -- nowhere more so than the mining region of India's eastern interior, the part of the country that produces the iron for the buildings and cars, the coal that keeps the lights on in faraway metropolises, and the exotic minerals that go into everything from wind turbines to electric cars to iPads.

If you were to lay a map of today's Maoist insurgency over a map of the mining activity powering India's boom, the two would line up almost perfectly. Ground zero for the rebellion lies in Chhattisgarh and Jharkhand, a pair of neighboring, mostly rural states some 750 miles southeast of New Delhi that are home to 46 million people spread out over an area a little smaller than Kansas. Urban elites in India envision them as something akin to Appalachia, with a landscape of rolling forested hills, coal mines, and crushing poverty; their undereducated residents are the frequent butt of jokes told in more fortunate corners of the country.

Revenues from mineral extraction in Chhattisgarh and Jharkhand topped $20 billion in 2008, and more than $1 trillion in proven reserves still sit in the ground. But this geological inheritance has been managed so disastrously that many locals -- uprooted, unemployed, and living in a toxic and dangerous environment, due to the mining operations -- have thrown in their lot with the Maoists. "It is better to die here fighting on our own land than merely survive on someone else's," Phul Kumari Devi told us when we visited her dusty mining village of Agarbi Basti in June. "If the Maoists come here, then we would ask their help to resist."

The mines are also cash registers for the Maoist war chest. Through extortion, covert attacks, and plain old theft, insurgents have tapped a steady stream of mining money to pay their foot soldiers and buy arms and ammunition, sometimes from treasonous cops themselves. The result is the kind of perpetual-motion machine of armed conflict that is grimly familiar in places like the oil-soaked Niger Delta, but seems extraordinary in the world's largest democracy.

This isn't just an Indian story -- it's a global one. In the wake of Singh's economic reforms, foreign investment in the country has grown to 150 times what it was in 1991. Among other things, India has opened up its vast mineral reserves to private and international players, and now major global companies like Toyota and Coca-Cola rely on mining operations in the heart of the Maoist war zone. Investors in the region claim that the fighting is taking a toll on their businesses, and Bloomberg News recently estimated that some $80 billion worth of projects are stalled at least in part by the guerrilla war, enough to double India's steel output.

But in our visits to the region and dozens of interviews there -- with miners and politicians, refugees and paramilitary leaders, cops and go-betweens for the guerrillas -- we found a far more complex reality. Mining companies have managed to double their production in the two states in the past decade, even as the conflict has escalated; the most unscrupulous among them have used the fog of war as a pretext for land grabs, leveling villages whose residents have fled the fighting. At the same time, the Maoists, for all their communist rhetoric, have become as much a business as anything else, one that will remain profitable as long as the country's mines continue to churn out the riches on which the Indian economy depends.

The first sign you see as you leave the airport in Jharkhand's capital city of Ranchi welcomes you to the "Land of Coal," and indeed, mining underlies every aspect of life here. Seams of coal are visible in the earth alongside the rutted roads that connect the jungle hamlets. Travelers learn to anticipate mines not by any road signs, but by the processions of men pushing bicycles heaped with burlap sacks full of coal: day laborers who pay for the opportunity to scrape the stuff out of thousands of off-the-books mines and sell it door to door as heating fuel, for perhaps a few more dollars a day than they would make as farmers trying to eke out a living from Jharkhand's depleted soil.

India's coal country was mostly passed over by British colonists until they discovered its mineral wealth in the late 19th century and built the obligatory handful of dusty frontier towns and roads necessary to take advantage of it. Today the region bears the obvious scars of a hundred-odd years of heavy industry. The damage is most visible at road marker 221 of Jharkhand's main north-south highway, about 40 miles outside Ranchi, where a freshly paved patch of asphalt veers sharply west and snakes up a smoky hill through the village of Loha Gate and into an ecological disaster zone. Shimmering waves of heat, thick with carbon monoxide and selenium, waft through jagged cracks in the pavement large enough to swallow a soccer ball. A hundred feet below, a massive subterranean coal fire, started in an abandoned mine, burns so hot that it melts the soles of one's shoes. The only vestiges of plant life are the scattered hulks of desiccated trees. Like the legendary coal fire that destroyed Centralia, Pennsylvania, this blaze could easily smolder for another 200 years before the coal seam is finally burned through.

There are at least 80 coal fires like this burning in Jharkhand, turning much of the state's ground into a giant combustible honeycomb. A fire ignited in 1916 by neglectful miners near the city of Jharia has grown so large that it now threatens to burn away the land beneath the entire community, plunging the 400,000 residents into an underground inferno. One mine just outside Jharia collapsed in 2006, killing 54 people.

Coal mining and armed rebellion have long gone hand in hand in what is now Jharkhand, both dating back to the mid-1890s, when the British began extracting coal from the area and Birsa Munda, today a local folk hero, launched a tribal revolt to regain local control of resources. The British quelled the uprising with a massive deployment of troops, but the resentment festered. India's government after independence proved a poor landlord as well, with decades of mining disasters -- more than 700 people were killed in them between 1965 and 1975 alone -- and a corrupt, nearly feudal government that made what was then the state of Bihar notorious in India as the country's most poorly run, backward region.

By the 1990s, fed-up residents campaigned to carve Jharkhand and Chhattisgarh into their own jurisdictions. The politicians behind the movement argued that the people who lived in the shadow of the mines were the least likely to benefit from them, the spoils instead accruing to large out-of-state corporations and venal government officials in distant capitals. In 2000, India's Parliament acquiesced, forming new states that then-Home Minister L.K. Advani declared would "fulfill the aspirations of the people."

But statehood only enabled the rise of a new cast of villains. Absentee political landlords were replaced with home-grown thugs who exploited the new state government's lax oversight to build their own fiefdoms. Madhu Koda, one of Jharkhand's former chief ministers, is awaiting trial on allegations he siphoned $1 billion from state coffers -- an astonishing 20 percent of the state's revenues -- during his two-year tenure. Mining operations, fast-tracked without regard for environmental or safety concerns, expanded at an alarming rate and are now projected to displace at least half a million people in Jharkhand by 2015.

The blighted landscape has proved to be fertile ground for the Maoist insurgency's renaissance. In the 1960s and 1970s, the Maoists' predecessors in the Naxalite movement had waged a bloody revolutionary campaign across rural India, only to mostly fade away by the early 1990s. The Maoists who have picked up the Naxalites' banner in recent years are different, and the contours of their rebellion are hard to pin down.

These fighters claim to be led in battle by an elusive figure called Kishenji, who depending on whom you ask is either a one-legged, battle-hardened Brahmin, a 1960s-era radical with a Ph.D. from New Delhi, or simply a moniker used by anyone within the organization who wishes to sound authoritative or confuse the police. The guerrillas shun email and mobile phones and rarely communicate with the world beyond the jungle, mostly via letters ferried back and forth by foot soldiers. Over several years of attempted correspondence, we received only a few missives in return. All were written in an opaque style full of the sort of arcane Marxist jargon that the rest of the world forgot in the 1970s.

Today's Maoists maintain the radical leftist politics of their predecessors and draw their civilian support from the same rural grievances -- poverty, lack of justice, political disenfranchisement. But they are less an organized ideological movement than a loose confederation of militias, and many of their local commanders appear to be in it for the money alone. They wage war sporadically across a 1,000-mile swath of India, operating without a permanent base, relying on the tacit support of villagers to evade the police and paramilitary forces that hunt them, and periodically raiding remote police stations for resupplies of arms and ammunition.

But the rebels' primary revenue comes from the region's mines. Where the Naxalites used to congregate in areas with longstanding conflicts between landowners and laborers, Maoist strongholds now tend to pop up within striking distance of large-scale extractive operations. Such mines cover vast areas and are difficult to secure, making them sitting ducks for well-armed insurgents. "Most of the mines in this state are in the forests, so we are easy targets," says Deepak Kumar, the owner of several such mines in Jharkhand. "The only way to stop the attacks is to negotiate."

Kumar comes from a long line of Jharkhandi robber barons. In the 1980s, he used his mining camps as staging grounds for stalking the region's near-extinct Bengal tigers. Today he owns a series of profitable but (by his own admission) illegal coal mines, hidden in the palm forests. Legal mines extract ore with giant machines that carve craters to the horizon; Kumar's are more like secret caves, the coal dug out of deep tunnels with pickaxes by day laborers working for $2 to $3 a day. He told us his revenues run about $4 million a year, typical for off-the-books operations in a state where less than half of raw materials are extracted legitimately.

On July 4, 2004, Kumar was closing out the day's accounts in his makeshift office at one of his mines when seven female guerrillas carrying automatic rifles broke down his door, forcing him into the forest at gunpoint. They marched him to a riverbed, where they stopped and held a gun to his head. "I thought I was going to die," he recalls. Instead they demanded $2.5 million for his ransom.

Through the night, the Maoists marched him barefoot over crisscrossing trails, until they happened across a police patrol that was searching for him. Kumar escaped in the ensuing gun battle. But after he returned to work several weeks later, Maoist negotiators knocked on his door and let him know he was still a target. So, Kumar told us, he quickly hashed out a business arrangement with the rebels: In exchange for their leaving his operation alone, he would pay them 5 percent of his revenues.

The protection money, like the small bribes Kumar says he pays to the police to avoid troublesome safety and environmental regulations, has simply become another operating cost. Kumar says that every mine owner he knows pays up, too. By his back-of-the-envelope approximation, if the other estimated 2,500 illegal mines in the state are doling out comparable kickbacks to the rebels, the Maoists' annual take would come to $500 million -- enough to keep a militant movement alive indefinitely. "It works like a tax," he says with a Cheshire grin, "just another business expense and now everything runs smoothly."

Calls by politicians to clamp down on the Maoists' extortion racket ring hollow as long as the politicians themselves are running the same sort of scheme -- and in Jharkhand, they often are. Shibu Soren, a former national minister for coal and chief minister of Jharkhand until he was removed from office in May, has been tried for murder three times, though he was ultimately acquitted. (The crimes' witnesses had a habit of disappearing, or turning up dead.) Last year, local newspapers exposed a case in which two henchmen of another local politician assassinated a children's development aid worker, reportedly because he refused to pay the obligatory 10 percent kickback of his dairy goods after receiving a government contract. What they would have done with 3,000 gallons of milk is anyone's guess.

"If you want to be somebody in Jharkhand, just kill an aid worker," T.P. Singh, a Jharkhand correspondent for the Sahara Samay cable network, told us. A large man with a thick mustache, a TV-ready cocksure grin, and a penetrating stare, Singh is the network's crime and corruption exposé king, and a celebrity in the region. He plays the role of the TV cowboy to the hilt, right down to the ubiquitous ten-gallon hat he was wearing when we met him at the local press club in the Jharkhandi mining city of Hazaribagh to ask about the dangers of reporting on powerful people in a land with no effective laws.

"You know how I get those boys to respect me?" Singh replied. "With this." He reached into the waistband underneath his knee-length kurta and pulled out a Dirty Harry six-shooter, loaded and ready for action. A former Maoist turned politician, sitting on a couch across from Singh awaiting an interview, nodded his solemn approval.

The act is part bluster, but also part necessity. Many of Singh's media compatriots in Jharkhand have been killed, kidnapped, or threatened with death by the Maoists, miners, politicians, or all three at some point in their careers. In some areas, local law enforcement has simply ceded authority to government-sanctioned civilian militias, which are often accused by locals of pillaging even more rapaciously than the Maoists -- and contributing to the fighting by arming poor villagers. The most feared among them is Salwa Judum, secretly assembled by the Chhattisgarh government in 2005 to fight the Maoists; its 5,000-odd members patrol the state armed with everything from AK-47s to axes. Some roam the forest with bows and arrows.

"The Maoists have been killing locals for years," Mahendra Karma, the founder of Salwa Judum, told us. "But when [Salwa Judum members] kill Maoists or Maoist supporters, all of a sudden people shout the word 'human rights.' There should be no double standard. If we kill a Maoist, then how is that a violation of human rights?"

Karma has the thick frame and round face of a heavyweight boxer a decade past his prime. When we met him in his office, far from the fighting, in Chhattisgarh's capital of Raipur, he was flanked by armed guards. Above his desk was a life-size portrait of Mahatma Gandhi.

Karma founded the militia in 2005, when he was opposition leader in the state parliament. In the years since, he has presided over his district's descent into a war zone, as the Maoists and Salwa Judum have taken turns torching villages and raping and killing hundreds of people each year in a spiral of revenge attacks. Some villages have been attacked more than 15 times by one side or the other. Salwa Judum members are also accused of extracurricular killing to settle personal scores, even dressing the bodies in Maoist uniforms to cover up their crimes.

When we met, Karma was happy at first to talk about the militia. But when our questions turned probing, his mood soured. Finally, rising to his feet and jabbing his finger into our chests, he shouted, "These questions you ask have come from the Naxalites -- you are the men of the Naxalites!" In Chhattisgarh, Karma's rage could easily amount to an extrajudicial death sentence. We were on the first flight back to Delhi.

It was just as well because by that point our attempts to contact anyone in the Maoist rebel camps had yielded next to nothing. After leftist author Arundhati Roy paid a visit to the Maoists this year, the Indian government reinterpreted its anti-terrorism laws to make speaking favorably about the rebels or their ideological aims -- including opposition to corporate mining -- punishable by up to 10 years in prison. This has made the Maoists' civilian allies cagey about dealing with outsiders, and the already reclusive fighters even more difficult to reach. After months of sporadic contact with the Maoists' liaisons, exchanging handwritten notes with couriers who arrived at our Ranchi hotel in the middle of the night, we made a breakthrough: Finally, a rebel spokesman by the nom de guerre of Gopal offered the prospect of visiting a Maoist camp. It would involve being whisked deep into the jungle on the back of a motor scooter and then camping out there for several days, waiting for the rebels to make contact, blindfold us, and take us the rest of the way to their outpost. We were ready to do it, but monsoon rains and a Green Hunt military offensive eventually scotched the plan.

Since then, the Maoists have kept busy. In addition to the May bus explosion near Bailadila that killed 35 people, the passenger-train derailment that same month killed almost 150 people, bringing total casualties to more than 800 so far in 2010 alone. The central government has responded by dispatching even more military resources to the area.

In a sense, however, India has already lost this war. It has lost it gradually, over the last 20 years, by mistaking industrialization for development -- by thinking that it could launch its economy into the 21st century without modernizing its political structures and justice system along with it, or preventing the corruption that worsens the inequality that development aid from New Delhi is supposed to rectify. The government is sending in Army advisors and equipment -- for now, the war is being fought by the Indian equivalent of a national guard, not the Army proper -- and spending billions of dollars on infrastructure projects in the districts where the Maoists are strongest. But it hasn't addressed the concerns that drove the residents of Chhattisgarh and Jharkhand into the guerrillas' arms in the first place -- concerns that are often shockingly basic.

In the town of Jamshedpur we visited Naveen Kumar Singh, a superintendent of police who can boast of a string of hard-won victories over the Maoists, which include demolishing training camps, confiscating weapons, and racking up a double-digit body count. But Singh is also responsible for winning his district's hearts and minds. When we stopped by his office, 10 petitioners were lined up in front of his desk. They were mostly poor men and women from rural areas, their clothes dusty from long bus rides. One woman in a purple sari arrived with a limp, leaning heavily on her son's shoulders. She asked Singh for help moving forward a police investigation into the car that hit her. Everyone in the room knew that without his signature on her crumpled forms, nothing would happen.

But Singh looked bored and sifted idly through the woman's handwritten papers. Finally, he waved his hand in the air and told her to go find more documents, ushering her back into the endless bureaucratic loop that is India's legal system. Most of the others received similar treatment.

Later, we asked him what the police were doing to combat the Maoists. When the police go on missions now, he told us, they pass out literature to the mostly illiterate peasantry and staple on every tree slogans warning people away from Maoism. "We don't only go into the forest to kill people," he bragged. "We also hang posters." 

Jason Miklian


Urban Legends

Why suburbs, not cities, are the answer.

View a photo essay of the world's top global cities

The human world is fast becoming an urban world -- and according to many, the faster that happens and the bigger the cities get, the better off we all will be. The old suburban model, with families enjoying their own space in detached houses, is increasingly behind us; we're heading toward heavier reliance on public transit, greater density, and far less personal space. Global cities, even colossal ones like Mumbai and Mexico City, represent our cosmopolitan future, we're now told; they will be nerve centers of international commerce and technological innovation just like the great metropolises of the past -- only with the Internet and smart phones.

According to Columbia University's Saskia Sassen, megacities will inevitably occupy what Vladimir Lenin called the "commanding heights" of the global economy, though instead of making things they'll apparently be specializing in high-end "producer services" -- advertising, law, accounting, and so forth -- for worldwide clients. Other scholars, such as Harvard University's Edward Glaeser, envision universities helping to power the new "skilled city," where high wages and social amenities attract enough talent to enable even higher-cost urban meccas to compete.

The theory goes beyond established Western cities. A recent World Bank report on global megacities insists that when it comes to spurring economic growth, denser is better: "To try to spread out economic activity," the report argues, is to snuff it. Historian Peter Hall seems to be speaking for a whole generation of urbanists when he argues that we are on the cusp of a "coming golden age" of great cities.

The only problem is, these predictions may not be accurate. Yes, the percentage of people living in cities is clearly growing. In 1975, Tokyo was the largest city in the world, with over 26 million residents, and there were only two other cities worldwide with more than 10 million residents. By 2025, the U.N. projects that there may be 27 cities of that size. The proportion of the world's population living in cities, which has already shot up from 14 percent in 1900 to about 50 percent in 2008, could be 70 percent by 2050. But here's what the boosters don't tell you: It's far less clear whether the extreme centralization and concentration advocated by these new urban utopians is inevitable -- and it's not at all clear that it's desirable.

Not all Global Cities are created equal. We can hope the developing-world metropolises of the future will look a lot like the developed-world cities of today, just much, much larger -- but that's not likely to be the case. Today's Third World megacities face basic challenges in feeding their people, getting them to and from work, and maintaining a minimum level of health. In some, like Mumbai, life expectancy is now at least seven years less than the country as a whole. And many of the world's largest advanced cities are nestled in relatively declining economies -- London, Los Angeles, New York, Tokyo. All suffer growing income inequality and outward migration of middle-class families. Even in the best of circumstances, the new age of the megacity might well be an era of unparalleled human congestion and gross inequality.

Perhaps we need to consider another approach. As unfashionable as it might sound, what if we thought less about the benefits of urban density and more about the many possibilities for proliferating more human-scaled urban centers; what if healthy growth turns out to be best achieved through dispersion, not concentration? Instead of overcrowded cities rimmed by hellish new slums, imagine a world filled with vibrant smaller cities, suburbs, and towns: Which do you think is likelier to produce a higher quality of life, a cleaner environment, and a lifestyle conducive to creative thinking?

So how do we get there? First, we need to dismantle some common urban legends.


Perhaps the most damaging misconception of all is the idea that concentration by its very nature creates wealth. Many writers, led by popular theorist Richard Florida, argue that centralized urban areas provide broader cultural opportunities and better access to technology, attracting more innovative, plugged-in people (Florida's "creative class") who will in the long term produce greater economic vibrancy. The hipper the city, the mantra goes, the richer and more successful it will be -- and a number of declining American industrial hubs have tried to rebrand themselves as "creative class" hot spots accordingly.

But this argument, or at least many applications of it, gets things backward. Arts and culture generally do not fuel economic growth by themselves; rather, economic growth tends to create the preconditions for their development. Ancient Athens and Rome didn't start out as undiscovered artist neighborhoods. They were metropolises built on imperial wealth -- largely collected by force from their colonies -- that funded a new class of patrons and consumers of the arts. Renaissance Florence and Amsterdam established themselves as trade centers first and only then began to nurture great artists from their own middle classes and the surrounding regions.

Even modern Los Angeles owes its initial ascendancy as much to agriculture and oil as to Hollywood. Today, its port and related industries employ far more people than the entertainment business does. (In any case, the men who built Hollywood were hardly cultured aesthetes by middle-class American standards; they were furriers, butchers, and petty traders, mostly from hardscrabble backgrounds in the czarist shtetls and back streets of America's tough ethnic ghettos.) New York, now arguably the world's cultural capital, was once dismissed as a boorish, money-obsessed town, much like the contemporary urban critique of Dallas, Houston, or Phoenix.

Sadly, cities desperate to reverse their slides have been quick to buy into the simplistic idea that by merely branding themselves "creative" they can renew their dying economies; think of Cleveland's Rock and Roll Hall of Fame, Michigan's bid to market Detroit as a "cool city," and similar efforts in the washed-up industrial towns of the British north. Being told you live in a "European Capital of Culture," as Liverpool was in 2008, means little when your city has no jobs and people are leaving by the busload.

Even legitimate cultural meccas aren't insulated from economic turmoil. Berlin -- beloved by writers, artists, tourists, and romantic expatriates -- has cultural institutions that would put any wannabe European Capital of Culture to shame, as well as a thriving underground art and music scene. Yet for all its bohemian spirit, Berlin is also deeply in debt and suffers from unemployment far higher than Germany's national average, with rates reaching 14 percent. A full quarter of its workers, many of them living in wretched immigrant ghettos, earn less than 900 euros a month; compare that with Frankfurt, a smaller city more known for its skyscrapers and airport terminals than for any major cultural output, but which boasts one of Germany's lowest unemployment rates and by some estimates the highest per capita income of any European city. No wonder Berlin Mayor Klaus Wowereit once described his city as "poor but sexy."

Culture, media, and other "creative" industries, important as they are for a city's continued prosperity, simply do not spark an economy on their own. It turns out to be the comparatively boring, old-fashioned industries, such as trade in goods, manufacturing, energy, and agriculture, that drive the world's fastest-rising cities. In the 1960s and 1970s, the industrial capitals of Seoul and Tokyo developed their economies far faster than Cairo and Jakarta, which never created advanced industrial bases. China's great coastal urban centers, notably Guangzhou, Shanghai, and Shenzhen, are replicating this pattern with big business in steel, textiles, garments, and electronics, and the country's vast interior is now poised to repeat it once again. Fossil fuels -- not art galleries -- have powered the growth of several of the world's fastest-rising urban areas, including Abu Dhabi, Houston, Moscow, and Perth.

It's only after urban centers achieve economic success that they tend to look toward the higher-end amenities the creative-classers love. When Abu Dhabi decided to import its fancy Guggenheim and Louvre satellite museums, it was already, according to Fortune magazine, the world's richest city. Beijing, Houston, Shanghai, and Singapore are opening or expanding schools for the arts, museums, and gallery districts. But they paid for them the old-fashioned way.

Nor is the much-vaunted "urban core" the only game in town. Innovators of all kinds seek to avoid the high property prices, overcrowding, and often harsh anti-business climates of the city center. Britain's recent strides in technology and design-led manufacturing have been concentrated not in London, but along the outer reaches of the Thames Valley and the areas around Cambridge. It's the same story in continental Europe, from the exurban Grand-Couronne outside of Paris to the "edge cities" that have sprung up around Amsterdam and Rotterdam. In India, the bulk of new tech companies cluster in campus-like developments around -- but not necessarily in -- Bangalore, Hyderabad, and New Delhi. And let's not forget that Silicon Valley, the granddaddy of global tech centers and still home to the world's largest concentration of high-tech workers, remains essentially a vast suburb. Apple, Google, and Intel don't seem to mind. Those relative few who choose to live in San Francisco can always take the company-provided bus.

In fact, the suburbs are not as terrible as urban boosters frequently insist.

Consider the environment. We tend to associate suburbia with carbon dioxide-producing sprawl and urban areas with sustainability and green living. But though it's true that urban residents use less gas to get to work than their suburban or rural counterparts, when it comes to overall energy use the picture gets more complicated. Studies in Australia and Spain have found that when you factor in apartment common areas, second residences, consumption, and air travel, urban residents can easily use more energy than their less densely packed neighbors. Moreover, studies around the world -- from Beijing and Rome to London and Vancouver -- have found that packed concentrations of concrete, asphalt, steel, and glass produce what are known as "heat islands," generating 6 to 10 degrees Celsius more heat than surrounding areas and extending as far as twice a city's political boundaries.

When it comes to inequality, cities might even be the problem. In the West, the largest cities today also tend to suffer the most extreme polarization of incomes. In 1980, Manhattan ranked 17th among U.S. counties for income disparity; by 2007 it was first, with the top fifth of wage earners earning 52 times what the bottom fifth earned. In Toronto between 1970 and 2001, according to one recent study, middle-income neighborhoods shrank by half, dropping from two-thirds of the city to one-third, while poor districts more than doubled to 40 percent. By 2020, middle-class neighborhoods could fall to about 10 percent.

Cities often offer a raw deal for the working class, which ends up squeezed by a lethal combination of chronically high housing costs and chronically low opportunity in economies dominated by finance and other elite industries. Once the cost of living is factored in, more than half the children in inner London live in poverty, the highest level in Britain, according to a Greater London Authority study. More than 1 million Londoners were on public support in 2002, in a city of roughly 8 million.

The disparities are even starker in Asia. Shenzhen and Hong Kong, for instance, have among the most skewed income distributions in the region. A relatively small number of skilled professionals and investors are doing very well, yet millions are migrating to urban slums in places like Mumbai not because they've all suddenly become "knowledge workers," but because of the changing economics of farming. And by the way, Mumbai's slums are still expanding as a proportion of the city's overall population -- even as India's nationwide poverty rate has fallen from one in three Indians to one in five over the last two decades. Forty years ago, slum dwellers accounted for one in six Mumbaikars. Now they are a majority.

To their credit, talented new urbanists have had moderate success in turning smaller cities like Chattanooga and Hamburg into marginally more pleasant places to live. But grandiose theorists, with their focus on footloose elites and telecommuting technogeniuses, have no practical answers for the real problems that plague places like Mumbai, let alone Cairo, Jakarta, Manila, Nairobi, or any other 21st-century megacity: rampant crime, crushing poverty, choking pollution. It's time for a completely different approach, one that abandons the long-held assumption that scale and growth go hand in hand.


Throughout the long history of urban development, the size of a city roughly correlated with its wealth, standard of living, and political strength. The greatest and most powerful cities were almost always the largest in population: Babylon, Rome, Alexandria, Baghdad, Delhi, London, or New York.

But bigger might no longer mean better. The most advantaged city of the future could well turn out to be a much smaller one. Cities today are expanding at an unparalleled rate when it comes to size, but wealth, power, and general well-being lag behind. With the exception of Los Angeles, New York, and Tokyo, most cities of 10 million or more are relatively poor, with a low standard of living and little strategic influence. The cities that do have influence, modern infrastructure, and relatively high per capita income, by contrast, are often wealthy small cities like Abu Dhabi or hard-charging up-and-comers such as Singapore. Their efficient, agile economies can outpace lumbering megacities financially, while also maintaining a high quality of life. With almost 5 million residents, for example, Singapore isn't at the top of the list in terms of population. But its GDP is much higher than that of larger cities like Cairo, Lagos, and Manila. Singapore boasts a per capita income of almost $50,000, one of the highest in the world, roughly the same as America's or Norway's. With one of the world's three largest ports, a zippy and safe subway system, and an impressive skyline, Singapore is easily the cleanest, most efficient big city in all of Asia. Other smaller-scaled cities like Austin, Monterrey, and Tel Aviv have enjoyed similar success.

It turns out that the rise of the megacity is by no means inevitable -- and it might not even be happening. Shlomo Angel, an adjunct professor at New York University's Wagner School, has demonstrated that as the world's urban population exploded from 1960 to 2000, the percentage living in the 100 largest megacities actually declined from nearly 30 percent to closer to 25 percent. Even the widely cited 2009 World Bank report on megacities, a staunchly pro-urban document, acknowledges that as societies become wealthier, they inevitably begin to deconcentrate, with the middle classes moving to the periphery. Urban population densities have been on the decline since the 19th century, Angel notes, as people have sought out cheaper and more appealing homes beyond city limits. In fact, despite all the "back to the city" hype of the past decade, more than 80 percent of new metropolitan growth in the United States since 2000 has been in suburbs.

And that's not such a bad thing. Ultimately, dispersion -- both city to suburb and megacity to small city -- holds out some intriguing solutions to current urban problems. The idea took hold during the initial golden age of industrial growth -- the English 19th century -- when suburban "garden cities" were established around London's borders. The great early 20th-century visionary Ebenezer Howard saw this as a means to create a "new civilization" superior to the crowded, dirty, and congested cities of his day. It was an ideal that attracted a wide range of thinkers, including Friedrich Engels and H.G. Wells.

More recently, a network of smaller cities in the Netherlands has helped create a smartly distributed national economy. Amsterdam, for example, has low-density areas between its core and its corporate centers. It has kept the great Dutch city both livable and competitive. American urbanists are trying to bring the same thinking to the United States. Delore Zimmerman, of the North Dakota-based Praxis Strategy Group, has helped foster high-tech-oriented development in small towns and cities from the Red River Valley in North Dakota and Minnesota to the Wenatchee region in Washington State. The outcome has been promising: Both areas are reviving from periods of economic and demographic decline.

But the dispersion model holds out even more hope for the developing world, where an alternative to megacities is an even more urgent necessity. Ashok R. Datar, chairman of the Mumbai Environmental Social Network and a longtime advisor to the Ambani corporate group, suggests that slowing migration to urban slums represents the most practical strategy for relieving Mumbai's relentless poverty. His plan is similar to Zimmerman's: By bolstering local industries, you can stanch the flow of job seekers to major city centers, maintaining a greater balance between rural areas and cities and avoiding the severe overcrowding that plagues Mumbai right now.

Between the 19th century, when Charles Dickens described London as a "sooty spectre" that haunted and deformed its inhabitants, and the present, something has been lost from our discussion of cities: the human element. The goal of urban planners should not be to fulfill their own grandiose visions of megacities on a hill, but to meet the needs of the people living in them, particularly those people suffering from overcrowding, environmental misery, and social inequality. When it comes to exporting our notions to the rest of the globe, we must be aware of our own susceptibility to fashionable theories in urban design -- because while the West may be able to live with its mistakes, the developing world doesn't enjoy that luxury.

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