Michael Lind argues New York and London are in for the biggest fall:
New York, London, and other financial centers were heavily dependent on financial-sector profits. Throw in the technology-driven collapse of the publishing and broadcast industries headquartered in such places, and those cities are likely to suffer devastating blows. Capitals of both politics and commerce, such as Paris and Tokyo, will adjust the best in the new state-capitalist world. Purely commercial centers such as New York and Frankfurt will suffer the most. Without the obscenely rich investment bankers and the legions of well-paid retainers who supported their lifestyles, formerly flourishing parts of these former financial capitals may become as derelict as Detroit or the crumbling industrial towns of northern Britain and Germany's Ruhr region.
Not so fast.
NYC and London are much more than financial centers - and always have been. Sure, finance generated a lot of income, especially in the top ranks, but the data show that greater NY is not overly dependent on finance and has significant capabilities across a broad range of creative industries. Ed Glaeser has advanced several compelling explanations for why NYC's unemployment has remained relatively low in the face of what was supposed to be devastating losses from the financial crisis, With Washington, D.C. in its mega-region gambit, New York will do just fine even if you believe Lind about the coming era of "state capitalism."
London is admittedly more finance-dependent, but it too has considerable capabilities in media, entertainment, fashion, and as a draw for global talent. How many other cities around the world can say that? And both NYC and London have withstood far more serious blows and and emerged stronger and more resilient, as Youssef Cassis' landmark study of global financial centers shows.
Paris and Tokyo are much more likely to lose as the global city system consolidates. This year's edition of the Global Financial Centres Index shows NYC and London consolidating their hold on global finance in the heat of the crisis, while Paris and Tokyo are getting clobbered.
The winners in the new era of capitalism are more likely than not to share the same fundamental characteristics that have defined leading-edge global cities in previous capitalist epochs - the economic benefits of diversity and openness in attracting talent, and of density and speed in mixing it to create new innovations, new firms, and new industries. Those advantages will only compound in the future.