In San Francisco and Rooting for a Tech Comeuppance

What kind of economy would San Francisco be without the technology sector? Mostly tourism, I would think. Economic progress always leaves some people behind.

The high cost of housing is killing the middle class and working class not just in SF, but in LA, SD, Boston, New York City, and many other hotspots around the country. It's an unfortunate fact of life.

At one time, this country was able to build enough cheap housing to largely avoid a shortage; but today with a burgeoning population of 312 million people and an entrenched "not-in-my-backyard" anti-development mentality in many tony suburbs, restrictions on high rise apartments in many cities, and much high costs of construction even when it is allowed, cheap housing is simply a thing of the past.

I spent several years in Phoenix during and immediately after the last housing boom, when beautiful new three and four-bedroom homes were built by the thousands and then sold for a fraction of the asking price. My own home, a modest but comfortable 3-bed 2-bath 2-car ranch, went from $225K to $110K (estimated value) and now is inching back up toward $200. Phoenix and Las Vegas are ripe for a migration of the middle class out of the increasingly exclusive coastal cities, pending only the increase in jobs in those areas from companies similarly relocating.

I suspect that economics and technology will solve the Bay Area's wealth chasm soon enough, as companies finally realize that they can do everything, have everything, and be everything in Salt Lake City, Phoenix, Las Vegas, Reno, Albuquerque, that they are in SF, Mountain Valley, etc.