Homelessness is a problem with or without the tech backdrop.
I would point out:
* Software companies, specifically, are more likely to be freeloaders than non-software companies. Tax avoidance schemes such as the Double Irish + Dutch Sandwich allow companies that make revenues primarily from intellectual property laws to skirt US and California taxation[1], and are therefore freeloading on the local governments by taking advantage of the talent from public schools (UC Berkeley), the local government infrastructure (roads, bridges, highways and freeways; a standardized electrical grid with a [somewhat] regulated utility company; financial regulations that keep [some] public faith in the banks and the US Dollar fiat currency; police system to keep the peace; fire systems to prevent runaway fires and catch arsonists; an intellectual property system that protects patents, copyrights, and trademarks [if you see the system as "protecting" these things]; a judicial system that allows persons and companies some say in how the law is applied to them and some opportunities to use litigation to enforce contracts; and national defense to prevent national instability and potential loss of private property or lives).
* For whatever reasons, tech companies want to be located within miles of each other, all challenging each other for talent and office space in a small geographic area, and all of the secondary effects of those things.
* Software allows companies to scale up without expensive upfront capital investments and allow fewer employees to generate more revenue than traditional types of brick-and-mortar businesses (although maybe not scale the way financial products scale). This provides for concentration of wealth in the hands of fewer people.
I would argue that the article and a handful of other SV articles miss some key issues related to costs for housing and other living expenses in California:
* Prop 13 limits the rate at which property taxes can rise up to market values. I observe 3 side-effects of Prop 13: (1) Properties have less turnover since Prop 13 in 1978 because property taxes reset to market rates if the property changes hands (except for a few exceptions) (2) Property taxes are kept low, thereby starving local governments of tax money needed for typical local government services (3) Property values are inflated because it's now more valuable to own a property since you aren't being taxed at the full rate
* Land is simply not in a large supply. Water surrounds the peninsula and is VERY expensive to build on (anything that alters the SF Bay ecosystem is expensive to develop). Much of the undeveloped land is owned and managed by the Open Space Preserve which is not develop-able. Many tracts of land owned by the farmers / orchard owners of pre-tech Santa Clara County have left their land to the county and state with the express wishes that the land be kept undeveloped.[2]
* What little land is able to be developed, dense development is prevented by "Not in My Back Yard" organizations ("NIMBY"s).[3] NIMBYs typically prevent high-rise construction (like SF waterfront).[4][5] This is the same with the BART transit system, which had tentative plans to run down the peninsula to San Jose, but was prevented by NIMBYism in the affluent peninsula neighborhoods.
* Good-intentioned but bad-implementation policies such as SF "rent control" and San Jose's newly proposed "low-income rental fee"[6]. Short of increasing supply or lowering demand, these are stop-gap policies that have some serious blowback effects.
> “We are trying to get tech billionaires involved in what we’re doing. They donate millions to good causes, but almost nothing to the local community they are helping destroy." Other related issues about how the rich/wealthy spend their charitable donations compared to the less rich/wealthy:
* I immediately thought of this article from Robert Reich, "When Charity Begins at Home (Particularly the Homes of the Wealthy)"[7] which basically says that the very wealthy overwhelmingly give to large university endowments and operas as their non-profit donations rather than community organizations that address homelessness or other poverty issues.
* Of course there are "non-profit" PAC contributions which effectively route "donations" to political campaigns to re-shape politics (such as the Waltons pushing anti-Union politics, the Waltons and the Kochs pushing anti-science and environment-negative policies ... none of which help local communities [but are also not directly related to the tech industry in the SF Bay Area]).
* You could argue that even when tech Billionaires donate to a charity, it could get squandered like Zuckerberg's $100 Million "donation" to New Jersey's Newark public school system, which some have argued didn't make any difference/change.[8]
* Tech companies are able to scale up better than traditional brick-and-mortars, so the wealth generated by tech companies is more concentrated in fewer hands. Stats show that the very wealthy donate a much smaller percentage of their income/wealth to charitable causes[9]. This means that local charities need to compete harder for fewer dollars and it's already less likely to go to a local organization than to a university endowment or some other more selfish charitable donation (an opera or a local environmental cause that serves to benefit the donator as much as anyone else).
[1] http://en.wikipedia.org/wiki/Double_Irish_arrangement [2] http://www.mercurynews.com/obituaries/ci_25043508/silicon-va... [3] http://en.wikipedia.org/wiki/NIMBY [4] http://techcrunch.com/2014/04/14/sf-housing/ [5] http://techcrunch.com/2014/11/02/so-you-want-to-fix-the-hous... [6] http://www.bizjournals.com/sanjose/news/2014/10/06/san-jose-... [7] http://robertreich.org/post/69833627613 [8] http://www.newyorker.com/magazine/2014/05/19/schooled [9] http://www.theatlantic.com/magazine/archive/2013/04/why-the-...
I remember reading a very long, well-researched, and balanced post from TechCrunch [1] about the housing shortage in SF. Media: more posts like that, please. Help identify underlying issues, flawed policies, or missed opportunities, instead of simply blaming the engineers.
Yes, gentrification does have some impact on people on the periphery, and we can't discount that, but on average, the population as a whole is better off. Back in the early '90s, SF's real estate was in a depression. RE agents were moving out, due to the RE market depression. What we have now needs addressing, but it's more of a governmental intervention which is necessary. Intervention to address the housing stock shortage.
We need an organization like ABAG to have some executive power. Someone who can say, these will be green areas, these areas we can build up, and we need to bring mass transit here. We need regional governmental integration. Piece-meal works too slowly to adapt to the changes brought on by economic development.
It's because the SF bay area is such an economic engine that we have so many people come here and find jobs they cannot find in their home states or counties. If we were in stagnation like Fresno/Bakersfield, we'd have people fleeing trying to find the economic magnet.
Oh, come on. At least in SF, that's obvious exaggeration: San Francisco had been the west-coast center of the financial industry since before the 1980s, and most of what you see on Market street was built decades (if not a century) earlier. It looked nothing like Fresno.
If you're referring to the economic status of the people living at mid-Market, it's equally wrong to use it as an example where "tech" is making things better: The Tenderloin was a blue-collar neighborhood before the war. It gradually descended into property as the rest of the city gentrified around it, leaving few places for working-class people to go. Gentrification absolutely made things worse in the Tenderloin.
Mid-Market's decline came as part of the larger Tenderloin decline, but also as the result of BART construction, which killed business on the road in the 60s. SOMA was light industrial in the 1960s and 1970s, but by the late 1980s, this area was beginning to gentrify as well. For example, entire blocks of SRO housing were eliminated during the 1980s to build Moscone Center.
About the only thing you can say regarding the "tech industry" is that it's the latest gentrifying wave of many, all of which have undoubtedly made things nicer for rich people, and worse for poor people. It's therefore completely unsurprising that someone in the tech industry would believe that gentrification makes things "better", but it doesn't reflect a lot of empathy.
My overarching point is that without tech, the Bay Area would not be the place people come to find good paying jobs --it would be more of a retirement destination and a tourist destination. Let's look at North Dakota, yes, there are homeless despite the boom, but if it were not the for the boom, the state would be in the dull-drums but with shale, whatever you think of it, you have a vibrant economy which attracts all people looking for a way to make a decent living -not everyone will be lucky. That's not to say we should not try to provide for those not lucky (I think we should), but to say that industry creates the "luckless" to me, is disingenuous.
Look at the population trends for SF as a proxy for economic vitality in the 70's and 80's:
1970 715,674 −3.3%
1980 678,974 −5.1%
1990 723,959 +6.6%
2000 776,733 +7.3%
2010 805,235 +3.7%
2013 837,442 +4.0%
[1]When white collar was basically finance, people used to commute _into_ the city. Whereas now, SF is a place people have a desire to live --it was not always that way. [2]http://sfist.com/2013/07/18/enemies_of_the_tall_four_seasons...
Do you mean "into poverty..."? Genuine question, not being snarky.
Anti-gentrification activists make it even worse since they oppose pretty much every new development. "We don't want luxury condos in our neightbourhood". Then you will have old tiny studios at the price of luxury condos.
People don't move to SF because because they look for a luxury condo here. They move to SF because there are jobs.
As I see it, we should focus on solving these issues as residence of the Bay Area as a whole. Pitting one group against another will just deplete the political will necessary to make vital policy changes to allow high density housing, mass public transit, raising minimum wage, improving education, etc.
The thing read like a bad undergraduate essay, wherein the student decided the thesis ("tech isn't really responsible for the bay area housing crisis!") before doing the research, discovered that the data didn't support her conclusion, then simply chose to overwhelm the reader with disconnected facts in an attempt to distract from the self-evident conclusion that, yes, we really are responsible for the latest spike in housing costs.
A more sophisticated analysis acknowledges that foregone conclusion, but then separates culpability from cause: the tech industry is certainly the cause of the latest housing crisis, but that doesn't mean growth in tech is automatically bad (or good, for that matter). Only once you have acknowledged those truths can you proceed forward with a rational discussion on what to do about the problem.
Once you acknowledge that this is an acute crisis caused by a single industry, you have to consider that one reasonable solution might be to discourage tech companies from coming to the city via taxes, zoning and so on. There is, after all, no inalienable right for startups to have offices in live/work lofts in SOMA.
Again, the whole thing was written to appeal to an audience of tech people who want to believe that they're not the problem and shouldn't have to sacrifice, even though the facts clearly point in the other direction. Why should the fabric of a city change instantaneously because a group of relatively entitled new arrivals believe that they somehow "belong" more than the people who arrived before?
We can't have a useful conversation that doesn't start from the acknowledgement that tech is a big part of the problem.
>“It’s not necessarily their fault, but they are stakeholders in the homelessness problem and have the power and brains to change it.”
Where are you detecting notes of "us" vs. "them"?
the author isn't nourishing the concept of 'us vs. them' it with what they wrote, just with the reports from others.
I agree. And yet, this place is set aflame every time a financial or banking article is posted, questioning when "we" are going to do something about "those people".
It isn't constructive, at all.
Agreed. But is there something about the tech industry as practiced in Silicon Valley (the sheer concentration; how VC money might prevent the Schumpeterian forces of creative destruction from regulating the local economic cycle; the exercise of political clout) that has made homelessness there particularly bad? Has anywhere else in the country experience this kind of sustained housing boom, of this magnitude?