San Francisco’s Insane Own-Goal
Bloomberg’s Editorial Board:
Silicon Valley’s high-tech cluster has been the envy of the world for decades, but there’s nothing inevitable about its success. As many cities have found in recent years, building such agglomerations is exceedingly hard, as much art as science. Low taxes, modest regulation, sound infrastructure and good education systems all help, but aren’t always sufficient. Once squandered, moreover, such dynamism can’t easily be revived. With competition rising across the U.S., the area’s policy makers need to recognize the dangers ahead.
In recent years, San Francisco has seemed to be begging for companies to leave. In addition to familiar failures of governance — widespread homelessness, inadequate transit, soaring property crime — it has also imposed more idiosyncratic hindrances. Far from welcoming experimentation, it has sought to undermine or stamp out home-rental services, food-delivery apps, ride-hailing firms, electric-scooter companies, facial-recognition technology, delivery robots and more, even as the pioneers in each of those fields attempted to set up shop in the city. It tried to ban corporate cafeterias — a major tech-industry perk — on the not-so-sound theory that this would protect local restaurants. It created an “Office of Emerging Technology” that will only grant permission to test new products if they’re deemed, in a city bureaucrat’s view, to provide a “net common good.” Whatever the merits of such meddling, it’s hardly a formula for unbounded inventiveness.
And:
These two traits — poor governance and animosity toward business — have collided calamitously with respect to the city’s housing market. Even as officials offered tax breaks for tech companies to headquarter themselves downtown, they mostly refused to lift residential height limits, modify zoning rules or allow significant new construction to accommodate the influx of new workers. They then expressed shock that rents and home prices were soaring — and blamed the tech companies.
There is undoubtedly more nuance here. And, sure, it’s complicated. But screw that. If you could boil this all down to one thing, housing would sure seem to be the best candidate. The tech sector’s boom in San Francisco created a huge demand and the city absolutely refused over and over again to meet it with supply. There are first and second order trickle down effects — housing costs, homelessness, crime, to name three — that all stem from this very basic foundation.
That’s why we need to reboot the entire system. Starting with the board of supervisors. We need to completely change that entity, and how it is elected. If we don’t, the tech sector exodus will continue, because at the end of the day, it makes no sense to operate under such a system which is a failure. And this will cause a downward spiral where what some may think will fix the issues, driving out the technology companies and employees, will actually destroy any chance to fix anything as resources vanish with revenues. This will create a void to be filled with more of the above — homelessness, crime, etc — until something flushes the toilet, be it a natural disaster or a natural progression of NIMBY waste passing on…
But it will be far too late by then.
And yes this is all insane because it should have been the exact opposite. San Francisco could have and should have been the most prosperous city in the world given its centrality to the most prosperous industry in the world right now. And this should have benefitted everyone here:
Such carelessness is all the more damaging because a tech hub is more than the sum of its parts. Such clusters accelerate the flow of ideas, concentrate skilled workers and create productive new networks. They’re likely to boost investment, business formation, innovation, wages and growth. And their benefits are widely shared: By one estimate, each new tech job creates five additional jobs in other industries, a multiplier effect about three times larger than that for manufacturing. That’s not to mention the immensely popular products that result.
It seems increasingly likely that history will look back on all this with three words: what the fuck?
