London is a city of extremes. Penthouse flats in One Hyde Park sell for £40m, while just a few miles away people pay £500 a month to live in a garden shed. The City offers some of the highest salaries in the world, yet in many boroughs, a third of young people are on the dole. The world’s rich flock to London’s private clubs and hospitals, but for every Jubilee Line stop from Westminster to Canning Town, residents can expect to live a year less. Can London ever work for us all?

I’ve lived in the capital nearly all of my life. My two sons were born in the same hospital as I was: the Whittington in Archway. I’ve been a London pupil – at Downhills Primary in Tottenham – and a London student – at the School of Oriental and African Studies, where I witnessed the fall of Margaret Thatcher and the start of the first Gulf war. I’ve worked long hours for little pay, frying chicken at the KFC on Tottenham High Road, attempting without any success to flog satellite dishes on commission in Holloway, and as a security guard as the Goldman Sachs building was going up.

I’ve also worked alongside some of the world’s finest legal minds as a barrister. I’ve seen the city of extremes – from both extremes. I know that London can be one of the most exhilarating cities in the world, but also one of the most difficult to live in, because I have seen it for myself. I still see it today in my own extended family, working as nurses in the NHS and shop assistants on the minimum wage.

London offered my father a home and the chance to run a small business when he moved here in 1956. It was, and remains, one of the most open-minded, tolerant places that anybody could hope to call home. But that home became a harsh, sometimes lonely place, as Dad’s business faltered and he lost his way, drinking heavily, leaving my mother to bring me up together with my four siblings.

Since my father arrived in London, Britain has been through two social revolutions. The
first, based on Sixties social liberalism, made Britain a more tolerant place. The second, based on Eighties free-market liberalism, injected some dynamism into a faltering economy. The apex of this tolerance and wealth was London. Many of the social changes worked for us all. Important battles over race relations led to black people in Notting Hill and Brixton and Asian people in Southall and Walthamstow becoming accepted by the majority of Londoners as friends and neighbours. Homosexuality was legalised and the gay scene, which already existed in many parts of London, was welcomed into the open. Women entered the workforce in greater numbers, fulfilling dreams that had gone wasted in previous generations. All made London a better place to live.

London also led the way in the Eighties freemarket revolution. Big Bang in the City opened up the financial industries, as London went from being the capital of a national economy to a centre of an international one. Pension funds rose on the back of the stock market, jobs were created in the City and tax revenue flowed into the Treasury. Cheaper credit helped many get a foot on a housing ladder that felt more like an escalator as prices continually rose. People felt wealthier, despite the sense that those at the top were pulling away from the rest.

Yet both these revolutions – social and economic – have their downside when they are not moderated by something else. The social liberalism that battles tirelessly against discrimination must be matched by an equal determination to ensure that society is integrated, too. In a good city, people of different races, ages and social classes interact with, understand and feel comfortable with one another. An emphasis on children’s rights means little without something to say about family relationships. A rights culture can do harm when it comes at the expense of backing teachers and parents to provide structure, boundaries and discipline. Social liberalism cannot be a substitute for a social fabric.

The same is true of the market liberalism that has dominated British politics for so long: left unchecked, it can harm society rather than enrich it. Family life becomes harder not easier when people struggle to make ends meet. I met a young dad who has been forced by low pay to work as a taxi driver by day and a security guard by night just to keep a leaking roof over the heads of his family, whom he never sees. On his taxi route, he can see Canary Wharf; those who work there might spend more on a night out than he spends on food for his family in a year. Is London working for him?

The truth is that people must have a stake in society if they are to feel a sense of belonging. The average Londoner working full-time earns just under £34,000 a year. The average London house price is £360,000. There is a problem when the average Londoner can never earn enough to buy the average London house. Home ownership is a popular way of putting down roots in a community – yet our economic model is making that impossible for many. Who are often forced into the hands of private landlords who push up rents and push down quality in response to increased demand. In Tottenham, I have seen whole families living in squalid rooms with no running water, no bathroom and no kitchen – and paying most of their income for the privilege. Every London MP will have similar stories.

Other cities compartmentalise their problems. In Paris in 2005, riots took place in the banlieue (the outskirts), away from the rest of society – someone else’s problem. London isn’t like that; last year’s riots were a Zones 1-6 problem. Great affluence lives cheek by jowl with extreme poverty. The Royal Borough of Kensington and Chelsea has its problem estates, just as Highgate millionaires live in my own borough of Haringey, one of the poorest in the country. London has no equivalent of the Bronx. Your problem is also my problem. During the riots, you could see the burning buildings of Tottenham, Wood Green and Enfield from the manicured lawns of Chigwell. It means that London works for us all, or it works for none of us. All in, or all out.

David Lammy is the MP for Tottenham

• The Collected "Tales of a City" [2]