At the turn of the millennium, the Western world talks about a Third Way. Yet the ascendance of New Left/New Labour and talk about various third ways in national governments in Western countries present us with a dilemma. This move away from more conservative governments in the 1980s to a new brand of social democracy during the 1990s occurred at a time when many big cities, traditionally the stronghold of official and unofficial progressive politics, fell into the hands of rather aggressive, conservative, neoconservative, neoliberal governments. In some cities, the ascendance of right-wing urbanism coincided with the restructuring of governance systems that provided the background for exemplary struggles over issues of local democracy, urban citizenship, and social justice. The official neoliberalism espoused by the entrepreneurial governments of large cities is, of course, counteracted by increasingly sophisticated and potentially radical urban movements that have begun to redefine the urban as a meaningful site for the forging of new alliances, for new political strategies, and new substantive concerns. But many of these movements have left the pathway of left-wing urban politics. If there is neoliberal urbanism and progressive urbanism, there are also new emerging coalitions and constellations that we may call the urban Third Way. But let us first consider why the Third Way has bypassed the city. Third Way and New Labour politics are mostly discussed in the traditional framework of national and international politics. It is the contention of this article that globalization has brought with it a rescaling of governance in significant new ways. Notwithstanding the insistence of many authors that the nation-state continues to be the main arena of socialization even in a global age, many of