After reading the article, this quote really jumped out at me:
"I was going along, being a good citizen," Todd, now 52 years old, says. "I was a volunteer firefighter, I coached football and baseball, I was saving my money, doing everything you're supposed to do, being a single father, raising my daughter by myself. Then the economy just went to hell and the company threw me to the wolves."
This is interesting because it sounds like what I've come to think of as the "salaryman" mentality: the idea that there is a contract between employee and company help each other, forever.
I don't want to say it implies entitlement, exactly, but more like a weird view of reality. Why do people think being a "good citizen" who "does everything you're supposed to do" means nothing will ever screw them? Or is this just rhetoric that people use to make themselves sound victimized?
I think this is a generational gap (in America, anyway). I don't think you would ever hear those words coming from a millennial. Maybe we've just learned from the mistakes of people like this guy.
"I don't think you would ever hear those words coming from a millennial."
Probably because Millennials grew up knowing there were wolves just outside the gates, and that your employer might throw you to them at any time. We're the first generation of Americans, in quite some time, to have experienced one significant crash or stagnation after the next. There is no "normal" in the job market, the stock market, the housing market, or just about any market for us. There never has been. We don't know normal, so accordingly, we're not clinging to it.
I don't blame older generations for slipping hard when the rug gets pulled out from under them. They are products of a very different era. I wouldn't blame a polar bear for not knowing his way around a tropical rain forest. I wouldn't blame a jaguar for not knowing his way around an arctic tundra. By the same token, I don't entirely blame a person from the "good old days" for not knowing his way around the chaos that characterizes our economy today. And to whatever degree I do blame him, I don't blame him entirely.
"I don't want to say it implies entitlement, exactly..."
That's because it doesn't. Perhaps it's just my cushy, liberal upbringing saying this, but emotionally speaking, I have a very hard time calling Todd "entitled." He works his ass off, struggles to get by, and nearly kills himself trying to make life seem semi-normal for his young daughter. All of this on $30 a day. That's odd behavior for an entitled person.
Maybe he lacked a degree of flexibility, or training, or resiliency in his career that led him to this point. That's a fair critique. He says he saved money, but we don't know how much, and we don't know what his spending habits were. Again, fair. We have plenty of things to analyze when picking apart Todd's story. But one thing he doesn't appear to be is entitled.
These people still remember when you could graduate high school, go to work for GM for a few decades, and have the company pension to depend on in retirement. A suburban house with a white picket fence is somewhere in there too.
Nowadays we're much more used to the at-will relationship. The employment only lasts until either the employee or the employer decides that things would be better off if the relationship ended. I don't think either is "weird" - just mindsets from different places/times.
Actually, that kind of sounds like dating too.......
There is a huge amount of stigma around homelessness and poverty. "Those people are irresponsible and they deserve everything that happens". His story just reminds us that what happened to him can happen to most people.
Because this view of reality was the American dream promised (literally and figuratively) by politicians, companies, churches, schools, families and advertisements in the 20th century.
You might not hear those words from a millenial, but I’ve heard many millenials complaining that their philosophy degree didn’t get them a well-paying job, or that it’s unfair for employers to expect them to already know how to do a job before hiring them. It feels like a similar mentality, just under different circumstances. (I don’t really buy into the whole “if only they’d worked harder/been smarter/prepared themselves better, they wouldn’t be in this situation” story line, but I also believe that thinking of yourself as a victim is counterproductive.)
As a millennial, your attitude doesn't help you one bit. You're still unemployed, or slaving away at short term jobs with no upward mobility--you've just never known any better. Maybe his attitude smacks of "entitlement" (what a dirty word!) but at least he had the opportunity to work in an America where companies had to care at least a little about their employees (because outsourcing and automation had yet to destroy opportunities for ordinary people). So who exactly is the sucker?
Of course there's a social contract. We also have laws against burglary even if you leave your front door unlocked. There's a limit to how much people are allowed to screw you. If someone takes an action that results in you losing your house, that person is an asshole even if they're not technically a criminal.
My impression is that most of the mandatory phase of education in the US teaches this lesson. It was well into my 20s that I really realized that I was taught wrong.
>I don't think you would ever hear those words coming from a millennial. Maybe we've just learned from the mistakes of people like this guy.
Or maybe the world used to be different, and the millennials are being released into a world of unemployment and a largely dismantled safety net. The generation gap has narrowed for them, largely because they're still living with their parents after college.
>I don't think you would ever hear those words coming from a millennial.
I have heard these words coming from a millennial. The thought process isn't related to age, it is related to the mindset that karma is real: if I do good things then good things will happen to me.
People eat it up because nobody likes to see bad things happen to good people.
You say this as if the 20-something libertarian software engineer isn't just as pissed off when he gets screwed over on equity or stock options as is the 50-something manufacturing worker whose job has just been outsourced.
To add to that in United States even if an employee is laid-off they are given severance package and on top of that they can apply for unemployement benefit and the government happily gives them a pay to survive on for about 6 months. Considering all of this I feel a salary man is in a good position and can find another job in 6 months.
There is a interesting anti-correlation between this and Prop G.
Prop G will be a retroactive tax applied to anyone who bought a multi unit building in SF in the last few years who would sell it the next few years. Tenants have no problem pushing this bill stating that buying a building does not entitle you to a lifelong contract and that 'things can change' which will negatively effect you. So even though you bought a building a year ago with no hint it could be taxed at 25%, you are now expected to pay that tax if you sell.
Now, on the other hand we have tenants who are upset that they have to leave their homes they (wrongly) assumed they could rent in forever. Either this is from ellis, OMI or other eviction. I feel for these people to a extent- But I am not a believer in the whole "right to stay in your birth city forever" movement. I do not believe anyone has any more of a right to live in San Francisco than they do Malibu or Aspen. It is one of the most expensive metros in the US.
If you are a 90 year old grandmother who was counting on your landlord not evicting the whole building, you should have known that was a risky bet to begin with. If you want to stay in a place forever you should buy the home. Otherwise, you need to be prepared to move should situations change. You need to prepare for all 'disasters' - That could be eviction, fire, death, floods, etc.. If you dont prepare, I will be sorry for you- But I dont think that entitles legal protection either. If you lose your house from a fire with no insurance, you are going to bare that burden alone.
The reason for the double standard is obvious though: no once cares about rich people's problems. I say that slightly tongue-in-cheek, but there's a legitimate social problem here. Rents in SF could not grow so out of control without the income disparities also growing. Of course a city is not a closed population, so a good portion of the problem comes from rich people disproportionately moving to San Francisco, but even with that it's clear that on a national level income inequality is increasing in a very de-stabilizing way and SF is a microcosm of those dynamics.
Unlike previous economic booms of the 19th and 20th centuries, there is no mediating factors such as a massive need for human labor or a common cultural belief among the mega-wealthy in a moral duty towards philanthropy, or even just simple taxation. Automation is getting so sophisticated that these days a lot of productivity gains come from deploying capital to automate things (software being a part of this), and not only do all the gains accrue to the capital holders, but the gains are taxed much less than regular income.
So the deck is stacked heavily in favor of people coming in and flipping SF property for massive profits simply by virtue of holding the capital to be able to do so. The fact that they get one unannounced tax curveball thrown their way is not someone that remotely compares to someone choosing a profession and working their whole life only to find that rents quadrupled in a 5-year period. The answer is not "sorry buddy, you should have been a banker or a computer programmer, but I hear Modesto is still pretty reasonable"; there aren't enough such jobs to maintain a middle class that way.
"...tech growth in cities like Seattle has been the same to San Francisco relative to its size, but the rise in the cost of living is less than a third of that experienced in San Francisco. This is largely attributed to the city building more housing to meet demand."
This seems to be the root of the problem. So much of the blame gets put on tech companies or the rich getting richer, but no one blames the elected officials for not doing the right thing and allowing new housing to be built.
And yet this thread will be filled with tech employees shitting on those less fortunate than themselves.
And what tech ceo is showing up at city council meetings up and down the peninsula demanding more housing, or in any fucking way using the platform their job gives them to help even their own employees, let alone other people in their communities?
Ladies and gentlemen, DanBlake:
If you are a 90 year old grandmother who was counting on your landlord not
evicting the whole building, you should have known that was a risky bet to
begin with. [1]
Yup. Fuck grannie -- why didn't she anticipate rental prices doubling in 5 years?
TheAceOfHearts:
Why don't these people just move to more affordable places? [2]
Piss on off out of your community, family, job, network, etc etc etc.
DannyBee:
Because people believe that once they've lived somewhere long enough, they
have a right to live there forever. [3]
Yup, it's a mystery why people living in sf don't like tech employees. It's literally stunning fyigm isn't more popular with the community!
People are concerned about "Manhattanization". That SF will become a "big city" and lose its "cultural charm", if zoning rules are relaxed and taller buildings are built outside the main valley that runs from FiDi to the Misdion.
Well, you know what's worse than Manhattan? Miami Beach. That's where SF is headed, if this jingoism keeps up. You can't fight a mass of rich people who want to live in your town: you can only contain them.
That is just beyond ridiculous. A small room you can't even sleep in (mentions excessive noise SEVERAL times) for almost $40,000/yr pre-tax all-in. Why people move there is beyond me...
Many may interpret this as victim blaming but I think it's a valid question: why have we as a country/culture become so much more resistant to moving? I know I've read more comprehensive literature on this before a but a quick google brought up these starting points:
I understand that we develop local support networks of friends and family and it's easy to understand why moving comes with the fear of having to start in a new place with no such network. But it seems that this fear has become limiting - that we are now refusing to relocate to places where greater opportunity exists because we can't stand the thought of leaving our current network behind. We're stuck, effectively. And it exacerbates the conditions in places like SF.
Because people believe that once they've lived somewhere long enough, they have a right to live there forever.
There are a lot of issues with this article.
It talks about the Ellis act as if it isn't standard in every other part of the country.
(in fact, the only thing non-standard is the state of the world pre-ellis act, where landlords in california could never evict people and decide to stop being landlords)
> Why don't these people just move to more affordable places?
It's not a viable solution to just "go somewhere more affordable" when you don't have the money to leave and there are no jobs where housing is more affordable. What you save in housing costs would be eaten up or exceeded by the cost of just getting to a job.
If you're rich, moving is always an option. If you're not rich or have no financial cushion, you are well and truly stuck.
I just went through a bout of homelessness. What money I did have, I had to spend on gas, food and minimal rent to stay in the area, because the option was going back home where the high-paying job is Walmart or a prison.
And by high-paying, I mean around $28K a year, if you're lucky.
Because they have roots and history in SF and the valley. They've got friends, family, and memories there. It's hard to give up your home.
It's those tech upstarts that're causing all the trouble; Moving there en-masse, with their strange ways and disrespect for the local culture. Always trying to "disrupt"; they're obviously troublemakers!
Really, it's no different from casual racism, but you've got to understand the roots: Fear of the unknown is a powerful motivating factor for most people.
Because cost are going up across the board throughout the Bay Area, and the transportation infrastructure - both automotive and otherwise - hasn't kept up.
Moving further means increased commuting cost. For drivers this comes in the form of massively increased fuel costs. For transit users this comes in the form of increased fares, since BART practices distance-based pricing.
Commuting daily from Fremont to SF costs $12, that's over 1h of minimum wage. Imagine if you had to pay 10-15% of your total income (pre-tax!) just to get to work. More if you're unable to get a full 8h of work a day.
Moving further also means a large reduction in disposal free time. Free time is a bit of a misnomer when it comes to the poor though - since the time isn't actually free. The article touches on this at a few points - the working poor require a lot of government subsidies and aid organizations for survival, all of which takes time, and most of which are located in SF.
One of the key inhibitors in helping people out of homelessness is, to be simplistic, lining up for things. The basic services they need to survive have huge lines to access them, making a large proportion of their lives idling in a waiting room, waiting for one necessary thing after another. Imagine the DMV, but every day, and multiple times a day.
All of this exacerbated by living far away. Not only are you waiting around forever for basic things, you're now spending more time to get there in the first place.
Even to a rational, completely-informed actor (an unsafe assumption, to say the least), the economics of living further away may not actually work.
Anyway, lots of cities have dysfunctional political and legal systems that prevent the supply of housing from growing. San Francisco's problems are particularly acute: http://www.citylab.com/housing/2013/10/san-francisco-exodus/... and are exacerbated by rent control, which discourages owners from even utilizing existing space.
As mentioned in the article, many who work full time in SF can't afford to live in the city. "Affordable places" generally means far east or south of their workplace, meaning that they have to spend an enormous amount of money and time commuting to their jobs. With time and money being a finite resource [for most], the commute time comes at the cost of family time and the cost of transportation comes out of their meager earnings (a fact that, if you live in SF or work at a company that provides a private bus, take for granted). Living outside of the city is still unaffordable for many people because of these costs.
The real problem is the scarcity of overall housing resources. With the boom in tech drawing more and more people into SF, it's only going to become more of an issue unless building picks up significantly. This is also true of salaries, which will have to increase in order for companies to hire people who can afford to live here, further driving a wedge between those who can and those who cannot live here.
1) Growth controls enacted in the 1960s and 1970s: Beginning in the late 1960s, the California Supreme Court started making a series of anti-development rulings: for example, one decision ruled that cities didn't have to compensate property owners for down-zoning their property, which reduces its value. This, of course, reduced financial risks for city governments that wanted to downzone massive tracts of land in their territory.
At the same time, cities across the Bay began enacting growth controls. Petaluma was the first in 1972, with an ordinance that restricted the number of houses that could be built per year to 500. (Economic studies comparing Petaluma with adjacent cities showed that its property prices rose at a faster pace than cities w/out growth control.)
Anti-growth measures began being widely adopted across the entire region. The behavior of California home prices started deviating from nationwide norms around 1975 or so. The problem became especially acute by the late 1970s, and so homeowners and tenants gave themselves a very sweet deal by effectively freezing their property taxes and rents via Prop. 13 and rent control. This insulated a majority of voters in cities like San Francisco from having to make tough decisions about in-fill development to match population growth. At this point, the mismatch is so out of whack and land is so valuable in San Francisco, that building a lot more housing probably wouldn't make it affordable to, say, a teacher salary level. Construction costs are $500,000 per unit, so your base price has to be at least that.
2) A byproduct of tech-dependent economic development strategy happens to be a lot of income inequality. I haven't seen a good solution to this. After manufacturing jobs dissipated from the U.S., a handful of cities like New York, Boston and San Francisco were successful at reviving themselves through a route of attracting highly-skilled, high-income workers. A consequence of this is a barbell-like jobs market where you have highly compensated workers in finance and tech on one side, and a whole cohort of service workers on the other. I've seen this wherever I travel. I went to Tel Aviv, which is arguably more dependent on tech than San Francisco with 10-11 percent of the workforce in the industry versus 6.7 percent here. Same issues with income inequality, inclusiveness and diversity.
3) Globalization of capital flows. Real estate used to be more of a local business, but now a lot of local firms have been swallowed up by REITS, which don't have any connection to the local community. At the same time, the Chinese property market is collapsing, sending flows of homebuyers and their cash over here. These are people who may not intend to actually live in the Bay Area, yet they buy up homes without even seeing them. The city doesn't know how to police this. How would you build a law or tax around regulating this behavior? New York may attempt a pied-a-terre tax, but no one really knows how to deal with this issue of vacant housing units held as investments. Technologically, it's easy to track who is doing what where at all times. But legally, there are a lot of issues around privacy with policing this if foreign buyers are taking up 1/3 of the new housing stock as investments.
Similarly in the venture world, while overall VC funds being raised is lower than what it was during the first dot-com bubble, according to the NVCA, there's a lot of PE and foreign investment that I don't think is calculated into the overall numbers.
4) Last is the lack of regional coordination. New York is 8.4 million people under one government. London is also 8.4 million people under one government. The Bay Area is 7 million people under 101 city governments and 10 bus and rail systems. There have been numerous attempts to consolidate power over the last century, but all have failed. The California state Constitution also deeply empowers its city governments compared to other states. So what happens is the rich cities don't build any housing, because they like their property values and don't like traffic congestion, or to crowd their schools. This drives prices up in the suburbs to a point where, on balance, urban environments look more attractive -- not just because of changing tastes, but also because they're not that much more expensive than the South Bay. So young people end up crowding into these poorer disinvested neighborhoods like the Mission or Oakland, which then displaces minorities and the elderly far out into the exurbs or even Central California.
To those people who believe this is the fault of tech - I have a question.
What is the ethical way to move to San Francisco? Or anywhere in the Bay? What do you think is a good solution to this, beyond some variant on tech people owing undefined amounts of money to everyone else?
I don't live in the US so my view is purely that of an outsider reading about this on HN over the last few years.
My problem is this: a lot of tech companies, based outside San Francisco go out of their way to make it easy for employees to live in SF and get to work outside of it. This is bad for the people who have lived there for a long time as they can't compete with the money the tech industry brings to the market. If your job is in SF I think it's perfectly fine to live there no matter what industry it's in. But taking space and driving up the price of space that could be used by someone who NEEDS to live there (e.g. a local butcher/hairdresser/convenience store owner) when you don't is unethical in my opinion. Not to mention that if those people can't live in the city and close down or move their businesses your life there won't be as good. It's not illegal and like all ethical questions the answer will differ from person to person but that's what I think about it.
Edit:
Of course the problem is the mindset of a lot of tech people (evident in this thread). They think logically and love 'the free market'. They're also predominantly young. They don't understand living in a place for 30/40 years and being forced out. They seem to ignore the emotions involved or feel they are irrelevant.
"For many San Franciscans who have been displaced or are on the verge of losing their homes, there's pain and a sense of powerlessness."
When I recently visited the Bay Area for the first time, I spoke with a worker who was helping with the catering of one of the events I attended. I sat with him while he was on break, and getting a bite to eat. When I asked him about himself, the conversation quickly arrived at this topic of gentrification. This sense of powerlessness is exactly how he felt, but there was also resentment toward new inhabitants making enough to afford the high cost of living.
Tech companies and workers are not the only (nor the main) cause of this issue, yet they're likely receiving a higher fraction of the blame. Whether this resentment is justified or not, it doesn't seem to be getting better with time. The cold but logical advice to "just move somewhere more affordable." isn't an acceptable solution to many of those who were or will be displaced.
I don't want to move to the Bay Area and exacerbate the problem, but there are clearly some great benefits of basing a startup there. So it's a difficult choice. Hopefully VR or another technology will make remote work a better solution than relocation in the future. Also, a better way to quickly and affordably retrain and enter a new profession must be made available to displaced workers so automation can replace low-wage service industry jobs faster.
If you are serious about the problems that result from NIMBY anti-growth sentiments, I strongly recommend that you join one of the following groups working to influence their city councils to build more housing. Just liking them on FB goes a long way to giving them more influence and credibility with their city councils and when you reshare their blogs or FB posts, if they gain just one more person willing to come to city hall with them, it's a terrific win. People ARE trying to do something about this problem, including many from the tech sector.
Take the feelings you have from this article and channel into a concrete good that you can do right now, today, for minimal effort and zero cost. The sad truth is that the people whose voices get heard at city council today are generally those people wealthy enough in both dollars and time to spend hours every week at city hall. They're mostly retired homeowners sitting on multimillion dollar properties. Renters, poor people, and homeless people receive almost no representation because they don't have the luxury of coming to city hall meetings- they're busy figuring out where they're going to spend the night and how they're going to feed their kids this week. These groups are doing just that on their behalf, so please support them.
If you're in Palo Alto, check out www.paloaltoforward.com (also www.facebook.com/paloaltoforward
Something that jumped at me in the beginning, about the soup kitchen line:
Some carry iPods and smartphones, others come in suits.
Am I wrong to assume that somebody that can afford a smartphone and accompanying plans (which are not that cheap) and other gadgets like iPod, which probably means they own a computer and a broadband internet connection too - usually aren't so poor that they would literally starve without a soup kitchen?
Sounds like a great startup idea: End the San Francisco construction ban. Make a lot of money.
Everyone always says to look for pain points when creating your startup, this is a great example. Maybe it's overlooked because it's not internet/software related ;)
[+] [-] delluminatus|11 years ago|reply
After reading the article, this quote really jumped out at me:
"I was going along, being a good citizen," Todd, now 52 years old, says. "I was a volunteer firefighter, I coached football and baseball, I was saving my money, doing everything you're supposed to do, being a single father, raising my daughter by myself. Then the economy just went to hell and the company threw me to the wolves."
This is interesting because it sounds like what I've come to think of as the "salaryman" mentality: the idea that there is a contract between employee and company help each other, forever.
I don't want to say it implies entitlement, exactly, but more like a weird view of reality. Why do people think being a "good citizen" who "does everything you're supposed to do" means nothing will ever screw them? Or is this just rhetoric that people use to make themselves sound victimized?
I think this is a generational gap (in America, anyway). I don't think you would ever hear those words coming from a millennial. Maybe we've just learned from the mistakes of people like this guy.
[+] [-] jonnathanson|11 years ago|reply
Probably because Millennials grew up knowing there were wolves just outside the gates, and that your employer might throw you to them at any time. We're the first generation of Americans, in quite some time, to have experienced one significant crash or stagnation after the next. There is no "normal" in the job market, the stock market, the housing market, or just about any market for us. There never has been. We don't know normal, so accordingly, we're not clinging to it.
I don't blame older generations for slipping hard when the rug gets pulled out from under them. They are products of a very different era. I wouldn't blame a polar bear for not knowing his way around a tropical rain forest. I wouldn't blame a jaguar for not knowing his way around an arctic tundra. By the same token, I don't entirely blame a person from the "good old days" for not knowing his way around the chaos that characterizes our economy today. And to whatever degree I do blame him, I don't blame him entirely.
"I don't want to say it implies entitlement, exactly..."
That's because it doesn't. Perhaps it's just my cushy, liberal upbringing saying this, but emotionally speaking, I have a very hard time calling Todd "entitled." He works his ass off, struggles to get by, and nearly kills himself trying to make life seem semi-normal for his young daughter. All of this on $30 a day. That's odd behavior for an entitled person.
Maybe he lacked a degree of flexibility, or training, or resiliency in his career that led him to this point. That's a fair critique. He says he saved money, but we don't know how much, and we don't know what his spending habits were. Again, fair. We have plenty of things to analyze when picking apart Todd's story. But one thing he doesn't appear to be is entitled.
[+] [-] beering|11 years ago|reply
Nowadays we're much more used to the at-will relationship. The employment only lasts until either the employee or the employer decides that things would be better off if the relationship ended. I don't think either is "weird" - just mindsets from different places/times.
Actually, that kind of sounds like dating too.......
[+] [-] DanBC|11 years ago|reply
[+] [-] subdane|11 years ago|reply
[+] [-] zippergz|11 years ago|reply
[+] [-] rayiner|11 years ago|reply
[+] [-] sp332|11 years ago|reply
[+] [-] mmagin|11 years ago|reply
[+] [-] pessimizer|11 years ago|reply
Or maybe the world used to be different, and the millennials are being released into a world of unemployment and a largely dismantled safety net. The generation gap has narrowed for them, largely because they're still living with their parents after college.
[+] [-] sosborn|11 years ago|reply
I have heard these words coming from a millennial. The thought process isn't related to age, it is related to the mindset that karma is real: if I do good things then good things will happen to me.
People eat it up because nobody likes to see bad things happen to good people.
[+] [-] aphelion|11 years ago|reply
[+] [-] ankurpatel|11 years ago|reply
[+] [-] DanBlake|11 years ago|reply
Prop G will be a retroactive tax applied to anyone who bought a multi unit building in SF in the last few years who would sell it the next few years. Tenants have no problem pushing this bill stating that buying a building does not entitle you to a lifelong contract and that 'things can change' which will negatively effect you. So even though you bought a building a year ago with no hint it could be taxed at 25%, you are now expected to pay that tax if you sell.
Now, on the other hand we have tenants who are upset that they have to leave their homes they (wrongly) assumed they could rent in forever. Either this is from ellis, OMI or other eviction. I feel for these people to a extent- But I am not a believer in the whole "right to stay in your birth city forever" movement. I do not believe anyone has any more of a right to live in San Francisco than they do Malibu or Aspen. It is one of the most expensive metros in the US.
If you are a 90 year old grandmother who was counting on your landlord not evicting the whole building, you should have known that was a risky bet to begin with. If you want to stay in a place forever you should buy the home. Otherwise, you need to be prepared to move should situations change. You need to prepare for all 'disasters' - That could be eviction, fire, death, floods, etc.. If you dont prepare, I will be sorry for you- But I dont think that entitles legal protection either. If you lose your house from a fire with no insurance, you are going to bare that burden alone.
[+] [-] ps4fanboy|11 years ago|reply
[+] [-] dasil003|11 years ago|reply
Unlike previous economic booms of the 19th and 20th centuries, there is no mediating factors such as a massive need for human labor or a common cultural belief among the mega-wealthy in a moral duty towards philanthropy, or even just simple taxation. Automation is getting so sophisticated that these days a lot of productivity gains come from deploying capital to automate things (software being a part of this), and not only do all the gains accrue to the capital holders, but the gains are taxed much less than regular income.
So the deck is stacked heavily in favor of people coming in and flipping SF property for massive profits simply by virtue of holding the capital to be able to do so. The fact that they get one unannounced tax curveball thrown their way is not someone that remotely compares to someone choosing a profession and working their whole life only to find that rents quadrupled in a 5-year period. The answer is not "sorry buddy, you should have been a banker or a computer programmer, but I hear Modesto is still pretty reasonable"; there aren't enough such jobs to maintain a middle class that way.
[+] [-] tsotha|11 years ago|reply
Which, of course, is part of the problem.
[+] [-] unknown|11 years ago|reply
[deleted]
[+] [-] jobu|11 years ago|reply
This seems to be the root of the problem. So much of the blame gets put on tech companies or the rich getting richer, but no one blames the elected officials for not doing the right thing and allowing new housing to be built.
[+] [-] x0x0|11 years ago|reply
And what tech ceo is showing up at city council meetings up and down the peninsula demanding more housing, or in any fucking way using the platform their job gives them to help even their own employees, let alone other people in their communities?
Ladies and gentlemen, DanBlake:
Yup. Fuck grannie -- why didn't she anticipate rental prices doubling in 5 years?TheAceOfHearts:
Piss on off out of your community, family, job, network, etc etc etc.DannyBee:
Yup, it's a mystery why people living in sf don't like tech employees. It's literally stunning fyigm isn't more popular with the community![1] https://news.ycombinator.com/item?id=8495124
[2] https://news.ycombinator.com/item?id=8494967
[3] https://news.ycombinator.com/item?id=8495015
[+] [-] ktothemc|11 years ago|reply
[+] [-] scythe|11 years ago|reply
Well, you know what's worse than Manhattan? Miami Beach. That's where SF is headed, if this jingoism keeps up. You can't fight a mass of rich people who want to live in your town: you can only contain them.
Build, baby, build.
[+] [-] krigi|11 years ago|reply
Three hours ago this unit was $1600. It was updated to $1800. http://sfbay.craigslist.org/sfc/apa/4726648527.html
It doesn't even have a kitchen. It's just a room with a toilet - at nearly $10 per sq. ft.
[+] [-] ulfw|11 years ago|reply
[+] [-] TheAceOfHearts|11 years ago|reply
[+] [-] astrocat|11 years ago|reply
http://www.slate.com/blogs/moneybox/2013/05/11/declining_ame...
http://www.theatlantic.com/business/archive/2012/03/generati...
I understand that we develop local support networks of friends and family and it's easy to understand why moving comes with the fear of having to start in a new place with no such network. But it seems that this fear has become limiting - that we are now refusing to relocate to places where greater opportunity exists because we can't stand the thought of leaving our current network behind. We're stuck, effectively. And it exacerbates the conditions in places like SF.
[+] [-] DannyBee|11 years ago|reply
There are a lot of issues with this article. It talks about the Ellis act as if it isn't standard in every other part of the country.
(in fact, the only thing non-standard is the state of the world pre-ellis act, where landlords in california could never evict people and decide to stop being landlords)
[+] [-] drivingmenuts|11 years ago|reply
It's not a viable solution to just "go somewhere more affordable" when you don't have the money to leave and there are no jobs where housing is more affordable. What you save in housing costs would be eaten up or exceeded by the cost of just getting to a job.
If you're rich, moving is always an option. If you're not rich or have no financial cushion, you are well and truly stuck.
I just went through a bout of homelessness. What money I did have, I had to spend on gas, food and minimal rent to stay in the area, because the option was going back home where the high-paying job is Walmart or a prison.
And by high-paying, I mean around $28K a year, if you're lucky.
[+] [-] GauntletWizard|11 years ago|reply
It's those tech upstarts that're causing all the trouble; Moving there en-masse, with their strange ways and disrespect for the local culture. Always trying to "disrupt"; they're obviously troublemakers!
Really, it's no different from casual racism, but you've got to understand the roots: Fear of the unknown is a powerful motivating factor for most people.
[+] [-] potatolicious|11 years ago|reply
Moving further means increased commuting cost. For drivers this comes in the form of massively increased fuel costs. For transit users this comes in the form of increased fares, since BART practices distance-based pricing.
Commuting daily from Fremont to SF costs $12, that's over 1h of minimum wage. Imagine if you had to pay 10-15% of your total income (pre-tax!) just to get to work. More if you're unable to get a full 8h of work a day.
Moving further also means a large reduction in disposal free time. Free time is a bit of a misnomer when it comes to the poor though - since the time isn't actually free. The article touches on this at a few points - the working poor require a lot of government subsidies and aid organizations for survival, all of which takes time, and most of which are located in SF.
One of the key inhibitors in helping people out of homelessness is, to be simplistic, lining up for things. The basic services they need to survive have huge lines to access them, making a large proportion of their lives idling in a waiting room, waiting for one necessary thing after another. Imagine the DMV, but every day, and multiple times a day.
All of this exacerbated by living far away. Not only are you waiting around forever for basic things, you're now spending more time to get there in the first place.
Even to a rational, completely-informed actor (an unsafe assumption, to say the least), the economics of living further away may not actually work.
[+] [-] DanBC|11 years ago|reply
Where do the nurses, teachers, security guards, waiters, shop assistants etc etc live?
[+] [-] smutticus|11 years ago|reply
[+] [-] jseliger|11 years ago|reply
In many cases, they are: most often to Sunbelt cities like Dallas, Houston, and Phoenix, which are the fastest growing in percentage terms in the nation (See Matt Yglesias at http://www.slate.com/blogs/moneybox/2012/06/14/in_the_future... or http://www.slate.com/blogs/moneybox/2013/05/23/fastest_growi...).
Yglesias also details some of this in The Rent Is Too Damn High (http://www.amazon.com/dp/B0078XGJXO?ie=UTF8&tag=thstsst-20&l... -- a must read on these issues, and I usually post a link when discussions like this one arise).
Anyway, lots of cities have dysfunctional political and legal systems that prevent the supply of housing from growing. San Francisco's problems are particularly acute: http://www.citylab.com/housing/2013/10/san-francisco-exodus/... and are exacerbated by rent control, which discourages owners from even utilizing existing space.
[+] [-] jmaha|11 years ago|reply
As mentioned in the article, many who work full time in SF can't afford to live in the city. "Affordable places" generally means far east or south of their workplace, meaning that they have to spend an enormous amount of money and time commuting to their jobs. With time and money being a finite resource [for most], the commute time comes at the cost of family time and the cost of transportation comes out of their meager earnings (a fact that, if you live in SF or work at a company that provides a private bus, take for granted). Living outside of the city is still unaffordable for many people because of these costs.
The real problem is the scarcity of overall housing resources. With the boom in tech drawing more and more people into SF, it's only going to become more of an issue unless building picks up significantly. This is also true of salaries, which will have to increase in order for companies to hire people who can afford to live here, further driving a wedge between those who can and those who cannot live here.
[+] [-] unknown|11 years ago|reply
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[+] [-] remarkEon|11 years ago|reply
[+] [-] unknown|11 years ago|reply
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[+] [-] unknown|11 years ago|reply
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[+] [-] kiba|11 years ago|reply
Why is the law not being changed?
[+] [-] api|11 years ago|reply
Roaring economy, NIMBYism, affordable housing -- pick two.
SF has picked roaring economy and NIMBYism.
[+] [-] ktothemc|11 years ago|reply
I'll just say this. It's four issues compounded.
1) Growth controls enacted in the 1960s and 1970s: Beginning in the late 1960s, the California Supreme Court started making a series of anti-development rulings: for example, one decision ruled that cities didn't have to compensate property owners for down-zoning their property, which reduces its value. This, of course, reduced financial risks for city governments that wanted to downzone massive tracts of land in their territory.
At the same time, cities across the Bay began enacting growth controls. Petaluma was the first in 1972, with an ordinance that restricted the number of houses that could be built per year to 500. (Economic studies comparing Petaluma with adjacent cities showed that its property prices rose at a faster pace than cities w/out growth control.)
Anti-growth measures began being widely adopted across the entire region. The behavior of California home prices started deviating from nationwide norms around 1975 or so. The problem became especially acute by the late 1970s, and so homeowners and tenants gave themselves a very sweet deal by effectively freezing their property taxes and rents via Prop. 13 and rent control. This insulated a majority of voters in cities like San Francisco from having to make tough decisions about in-fill development to match population growth. At this point, the mismatch is so out of whack and land is so valuable in San Francisco, that building a lot more housing probably wouldn't make it affordable to, say, a teacher salary level. Construction costs are $500,000 per unit, so your base price has to be at least that.
2) A byproduct of tech-dependent economic development strategy happens to be a lot of income inequality. I haven't seen a good solution to this. After manufacturing jobs dissipated from the U.S., a handful of cities like New York, Boston and San Francisco were successful at reviving themselves through a route of attracting highly-skilled, high-income workers. A consequence of this is a barbell-like jobs market where you have highly compensated workers in finance and tech on one side, and a whole cohort of service workers on the other. I've seen this wherever I travel. I went to Tel Aviv, which is arguably more dependent on tech than San Francisco with 10-11 percent of the workforce in the industry versus 6.7 percent here. Same issues with income inequality, inclusiveness and diversity.
3) Globalization of capital flows. Real estate used to be more of a local business, but now a lot of local firms have been swallowed up by REITS, which don't have any connection to the local community. At the same time, the Chinese property market is collapsing, sending flows of homebuyers and their cash over here. These are people who may not intend to actually live in the Bay Area, yet they buy up homes without even seeing them. The city doesn't know how to police this. How would you build a law or tax around regulating this behavior? New York may attempt a pied-a-terre tax, but no one really knows how to deal with this issue of vacant housing units held as investments. Technologically, it's easy to track who is doing what where at all times. But legally, there are a lot of issues around privacy with policing this if foreign buyers are taking up 1/3 of the new housing stock as investments.
Similarly in the venture world, while overall VC funds being raised is lower than what it was during the first dot-com bubble, according to the NVCA, there's a lot of PE and foreign investment that I don't think is calculated into the overall numbers.
4) Last is the lack of regional coordination. New York is 8.4 million people under one government. London is also 8.4 million people under one government. The Bay Area is 7 million people under 101 city governments and 10 bus and rail systems. There have been numerous attempts to consolidate power over the last century, but all have failed. The California state Constitution also deeply empowers its city governments compared to other states. So what happens is the rich cities don't build any housing, because they like their property values and don't like traffic congestion, or to crowd their schools. This drives prices up in the suburbs to a point where, on balance, urban environments look more attractive -- not just because of changing tastes, but also because they're not that much more expensive than the South Bay. So young people end up crowding into these poorer disinvested neighborhoods like the Mission or Oakland, which then displaces minorities and the elderly far out into the exurbs or even Central California.
[+] [-] Kalium|11 years ago|reply
What is the ethical way to move to San Francisco? Or anywhere in the Bay? What do you think is a good solution to this, beyond some variant on tech people owing undefined amounts of money to everyone else?
[+] [-] k-mcgrady|11 years ago|reply
My problem is this: a lot of tech companies, based outside San Francisco go out of their way to make it easy for employees to live in SF and get to work outside of it. This is bad for the people who have lived there for a long time as they can't compete with the money the tech industry brings to the market. If your job is in SF I think it's perfectly fine to live there no matter what industry it's in. But taking space and driving up the price of space that could be used by someone who NEEDS to live there (e.g. a local butcher/hairdresser/convenience store owner) when you don't is unethical in my opinion. Not to mention that if those people can't live in the city and close down or move their businesses your life there won't be as good. It's not illegal and like all ethical questions the answer will differ from person to person but that's what I think about it.
Edit:
Of course the problem is the mindset of a lot of tech people (evident in this thread). They think logically and love 'the free market'. They're also predominantly young. They don't understand living in a place for 30/40 years and being forced out. They seem to ignore the emotions involved or feel they are irrelevant.
[+] [-] scobar|11 years ago|reply
When I recently visited the Bay Area for the first time, I spoke with a worker who was helping with the catering of one of the events I attended. I sat with him while he was on break, and getting a bite to eat. When I asked him about himself, the conversation quickly arrived at this topic of gentrification. This sense of powerlessness is exactly how he felt, but there was also resentment toward new inhabitants making enough to afford the high cost of living.
Tech companies and workers are not the only (nor the main) cause of this issue, yet they're likely receiving a higher fraction of the blame. Whether this resentment is justified or not, it doesn't seem to be getting better with time. The cold but logical advice to "just move somewhere more affordable." isn't an acceptable solution to many of those who were or will be displaced.
I don't want to move to the Bay Area and exacerbate the problem, but there are clearly some great benefits of basing a startup there. So it's a difficult choice. Hopefully VR or another technology will make remote work a better solution than relocation in the future. Also, a better way to quickly and affordably retrain and enter a new profession must be made available to displaced workers so automation can replace low-wage service industry jobs faster.
[+] [-] _linden_|11 years ago|reply
Take the feelings you have from this article and channel into a concrete good that you can do right now, today, for minimal effort and zero cost. The sad truth is that the people whose voices get heard at city council today are generally those people wealthy enough in both dollars and time to spend hours every week at city hall. They're mostly retired homeowners sitting on multimillion dollar properties. Renters, poor people, and homeless people receive almost no representation because they don't have the luxury of coming to city hall meetings- they're busy figuring out where they're going to spend the night and how they're going to feed their kids this week. These groups are doing just that on their behalf, so please support them.
If you're in Palo Alto, check out www.paloaltoforward.com (also www.facebook.com/paloaltoforward
If you're in Mountain View, check out http://balancedmv.org/ and https://www.facebook.com/mvhousingdiversity
If you're in SF, https://www.facebook.com/BARentersFed and www.sfbarf.org
Menlo Park: https://www.facebook.com/MenloParkNoOnM
[+] [-] smsm42|11 years ago|reply
Some carry iPods and smartphones, others come in suits.
Am I wrong to assume that somebody that can afford a smartphone and accompanying plans (which are not that cheap) and other gadgets like iPod, which probably means they own a computer and a broadband internet connection too - usually aren't so poor that they would literally starve without a soup kitchen?
[+] [-] stephenitis|11 years ago|reply
I'm excited that publishers/authors are taking more time into the design of articles they roll out.
[+] [-] adwf|11 years ago|reply
Everyone always says to look for pain points when creating your startup, this is a great example. Maybe it's overlooked because it's not internet/software related ;)
[+] [-] dothething|11 years ago|reply
[+] [-] stephenitis|11 years ago|reply
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