San Francisco split by Silicon Valley's wealth

Aug 22, 2013 by Jessica Guynn

Every weekday starting at dawn and continuing late into the evening, a shiny fleet of unmarked buses rolls through the streets of San Francisco, picking up thousands of young technology workers at dozens of stops and depositing them an hour's drive south.

It's an exclusive perk offered by Apple, Facebook, Google and other major Silicon Valley companies: luxury coaches equipped with air conditioning, plush seats and wireless Internet access that ease the stress of navigating congested Bay Area roadways.

The private mass transit system has become the most visible symbol of the digital gold rush sweeping this city, and of the sharpening division between those who are riding the high-tech industry's good fortunes and those who are not.

"Some days I think of them as the spaceships on which our alien overlords have landed to rule over us," Rebecca Solnit, a longtime San Francisco resident, recently wrote in the London Review of Books.

Fueling the growing rift is a common belief that the vast wealth being amassed by the tech industry is not spilling over into the community.

Instead, activists say, the high-tech invasion is driving up the cost of living to levels that more San Franciscans cannot afford.

They say that a dramatic increase in rent, housing prices and evictions has sharpened and squeezed out more middle-class families, small businesses, artists and intellectuals, the people who gave San Francisco its rich and diverse cultural appeal.

Ground zero for this growing array of grievances is the Mission District, a historically working-class Latino neighborhood where Victorian flats and newer lofts have been overrun by techies.

Heated bidding wars - especially in a half-mile radius of shuttle bus stops - have broken out, causing rents to soar, even double in some cases. Along shuttle routes, trendy new restaurants that serve high-end food and spirits have taken the place of corner stores and mom-and-pop businesses.

Anti-Google graffiti has turned up here, and activists recently held a small anti-gentrification rally at which they smashed a Google bus pinata. Last year, a Google bus driver was caught on video threatening a bystander for photographing a shuttle blocking city buses and bicyclists.

Ted Gullicksen, executive director of the San Francisco Tenants Union, said he fears that the techies are permanently inheriting the city and won't pack up and leave as they did after the 2000 dot-com crash.

"In the first boom, many of those companies went belly-up. Now we are talking about some pretty well-established Internet companies such as Facebook and Google. It's hard to envision them going belly-up, and that's what rescued us the first time around," Gullicksen said.

Unlike in previous booms, the tech industry isn't creating as many middle-class jobs or as much goodwill. The gap between Silicon Valley's high and low earners is widening, with average per-capita incomes going up while median household incomes have fallen for the third consecutive year, according to Joint Venture Silicon Valley, a private group that publishes an annual report card on the region.

In a region that lays claim to some of the world's wealthiest companies, food stamp participation has hit a 10-year high, and homelessness has increased 20 percent in the last two years, the group found.

That has led to some pointed criticism - some of it coming from within technology's own ranks.

San Francisco entrepreneur Chris Tacy admonished fellow techies about their boorish behavior in a series of blog posts after watching a young man reluctantly give up his seat on a bus to an elderly woman and then say loudly to his friends: "I don't know why old people ride Muni. If I were old, I'd just take Uber."

Techies frequently use their smartphones to hop rides with the Uber car service to get to and from work and around town. The gleaming armada of black town cars and limousines is another reminder to some in San Francisco of the growing divide.

Uber, which is headquartered in San Francisco, raised eyebrows over the Fourth of July weekend when it offered New Yorkers the "ultimate freedom from the crowds, the traffic and the long trip out East" to the Hamptons: a rented helicopter for $3,000.

"Blair Waldorf, Don Draper and Jay Gatsby got nothing on you. This is the epitome of luxury, convenience and style," Uber boasted in a blog post.

It's just those kinds of showy displays of wealth that grate on people here.

Billionaire Napster founder and former Facebook executive Sean Parker spent millions on his fantasy June wedding in the woods of California's Big Sur. Last year David Sacks, a former PayPal executive who founded Yammer, threw himself a birthday party rumored to cost $1.4 million with the Louis XVI-theme "Let him eat cake."

Google's three top executives - Larry Page, Sergey Brin and Eric Schmidt - are building their own private $82 million corporate jet center at San Jose International Airport. It will have five hangars on 29 acres, with one hangar large enough to accommodate a Boeing 747.

If resentment of the growing wealth and power of the tech industry is building, "we are bringing this on ourselves," Tacy said.

"A lot of people in the U.S. don't have economic confidence in the future and at the same time you have a lot of tech wunderkind becoming billionaires," he said. "It's a volatile combination."

Matt Brezina, who has founded two companies here and lives in San Francisco, says the wave of gentrification is inevitable. People are being priced out of San Francisco as they have been out of other highly desirable cities such as Manhattan, Tokyo and London. He acknowledges "a bit" of conspicuous consumption, but says it's not the norm for this generation of techies, many of whom have given millions to charity.

"We have a bit of a different culture here that kind of frowns on that," he said. "We don't wear Prada, and we'll drive a Porsche but not one we own. Who wants to own a car? We drive Porsches on track days at Laguna Seca."

But a recent article in the New Yorker magazine made some here squirm. The author, George Packer, pointed out that Silicon Valley has 50 or so billionaires and tens of thousands of millionaires, but also record numbers of poor people.

"After decades in which the country has become less and less equal, Silicon Valley is one of the most unequal places in America," he wrote.

Jake Levine, general manager of Digg, said in a recent blog post that he was guilty of "pretty much every arrogance" the piece called out and pledged to become more involved in addressing real-world problems.

Theresa Flandrich, 58, who shares a small, $645-a-month one-bedroom apartment with her 25-year-old son in North Beach, one of San Francisco's oldest neighborhoods, said she would like to see young, wealthy technology workers connect with the communities in which they live.

Most young technology workers order food and supplies online, so she doesn't run into them at the corner store. They keep their noses buried in their smartphones when they walk on the streets and don't volunteer in the community, Flandrich said.

She has seen a sharp uptick in evictions under the Ellis Act, the state law that allows a landlord to evict all tenants of a building if it is being taken off the rental market. And now she and the other tenants in her building - some elderly and disabled - have also received eviction notices. She is facing the prospect of leaving the neighborhood where she has lived for three decades.

Her son, like most young people, wants to be able to move out and live on his own even as the city gets more and more expensive.

So he's hunting for a job as a recruiter in the tech industry.

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User comments : 18

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ormondotvos
1 / 5 (2) Aug 22, 2013
There are very inexpensive high-quality apartments in my coop, Atchison Village, in West Richmond. google it. Own your own place, have nice neighbors, participate in your own government with 449 others...
holoman
1 / 5 (6) Aug 22, 2013
Startup Energy Company looking for investors.

Unique Renewable Hydrocarbon Technology Independent of Geo Political Conflicts

http://www.prweb....8185.htm

210
1.6 / 5 (7) Aug 22, 2013
You cannot really blame anyone for being successful if they earn it legally.Just can't! The real problem I see is that N a free society, with an attractive environment, new industries, and the power of excellent educational institutions pulling people N from all over the world, NO ONE knows, or knew, to learn WHAT, so that they could work for Google back in the mid 1990's. Now those from THAT day must compete with techies who ARE knowledgeable in what is now required 20 years later.There are not enough Googles all over the world 2 take in all the people who CAN learn & work 4 Google. Chinese 4 example LOVE D San Francisco area, damn, can't blame em! China makes tech jobs too, but, it is not Quid Pro Quo.China is NOT 'Open' on par with most western nations, & many western nations send students 2 the USA, who stay. One answer may lie N providing a broad general education experience year-round, first 6-7 years. 2)Break-out USA STEM kids sooner & IMMERSE them 2 compete AND make businesses
Gmr
2.3 / 5 (3) Aug 22, 2013
Augh. 210, that hurt to try and read. You may make a good point, but it honestly is hard for me to tell.

The major problem I see is a monolithic industrial sector establishing a town as essentially it's playground. This happened before - note Detroit, where most of the wealth was generated by a single industrial sector. This makes them extremely vulnerable, and monolithic in who ends up in the job market in the region.

You can see this in towns where Air Force bases and Army posts have closed down. Industries come to depend on them, and the lack of diverse labor and diverse business means the town or city suffers greatly when its signature industry leaves or fails. If anything, some of these companies should be encouraged to relocate - but that would mean cutting off this flow of income into the city for a while.

It's ugly, but the future for San Francisco is bleak if this becomes the norm. Eventually, it will bite them in the ass.
zaxxon451
3 / 5 (4) Aug 23, 2013
Let's all close our eyes really hard and pretend Capitalism hasn't failed. Good. There's your American Dream. And it's as close as you're ever gonna get to it.
210
1.8 / 5 (10) Aug 30, 2013
Let's all close our eyes really hard and pretend Capitalism hasn't failed. Good. There's your American Dream. And it's as close as you're ever gonna get to it.

If Capitalism and The American Dream have failed so badly, show me your idea of success.
word-
210
1 / 5 (8) Aug 30, 2013

The major problem I see is a monolithic industrial sector establishing a town as essentially it's playground. This happened before - note Detroit, where most of the wealth was generated by a single industrial sector. This makes them extremely vulnerable, and monolithic in who ends up in the job market in the region.
You can see this in towns where Air Force bases and Army posts have closed down. Industries come to depend on them, and the lack of diverse labor and diverse business means the town or city suffers greatly when its signature industry leaves or fails. If anything, some of these companies should be encouraged to relocate - but that would mean cutting off this flow of income into the city for a while.
Detroit, was not a technology hub. It was a finished product industrial center that got all of what it did outsourced AND the rest of the developing world and emergent nations learned to do what they were doing. IP, is a bit different. It is stratified!
ziphead
1.8 / 5 (5) Aug 30, 2013
Detroit, was not a technology hub. It was a finished product industrial center that got all of what it did outsourced AND the rest of the developing world and emergent nations learned to do what they were doing. IP, is a bit different. It is stratified!

The history books are littered with remains of unbeatable armies and ruins of eternal cities. Here's to yet another one.
zaxxon451
3.7 / 5 (3) Aug 31, 2013

If Capitalism and The American Dream have failed so badly, show me your idea of success.
word-


My idea of success? Let's start with a government that isn't owned by corporations. I suggest that you read more about how the laws of our country are written and who writes them. Start with ALEC, the American Legislative Exchange Council.
VendicarE
2.3 / 5 (6) Aug 31, 2013
"If Capitalism and The American Dream have failed so badly..." - 210

I fix.

Capitalism and The American Dream have failed so badly.

You are welcome.
Gmr
1 / 5 (1) Aug 31, 2013
Detroit, was not a technology hub. It was a finished product industrial center that got all of what it did outsourced AND the rest of the developing world and emergent nations learned to do what they were doing. IP, is a bit different. It is stratified!


It was a town based around one industry: making cars. It had mostly one type of job: making cars. San Francisco is catering to one industry: internet services. It has mostly one type of job: programmer. Auto manufacturing was stratified, too. Not everybody made cars in Detroit - but many of them either catered to those who did or those employed by those who did. And the same thing is happening in San Francisco.

San Fran already went through a downturn with the dotcom bust - and if there is ever a change in the wind, they will take it on the chin in a more massive manner. You can say all of the "products" are different, but they retail the same way, with the same labor.
210
1 / 5 (6) Sep 04, 2013

If Capitalism and The American Dream have failed so badly, show me your idea of success.
word-


My idea of success? Let's start with a government that isn't owned by corporations. I suggest that you read more about how the laws of our country are written and who writes them. Start with ALEC, the American Legislative Exchange Council.

This ALEC is not a nation, nor faces broad governance issues like a nation or state - and they are NOT a successful economy and the American Dream is very much that. Don't dodge the issue, go GET your example of success that applies to 'Dream' status...show me a Superpower that has allowed its people to live to pursue a 'dream'. Do not go get some little dinky nation that serves only 30 million people and place it on par with a country that has world-girdling effect and importance, go...go now...!
210
1.6 / 5 (7) Sep 04, 2013
IP, is a bit different. It is stratified!


It was a town based around one industry: making cars. It had mostly one type of job: making cars. San Francisco is catering to one industry: internet services. It has mostly one type of job: programmer. Auto manufacturing was stratified, too. Not everybody made cars in Detroit - but many of them either catered to those who did or those employed by those who did. And the same thing is happening in San Francisco.

San Fran already went through a downturn with the dotcom bust - and if there is ever a change in the wind, they will take it on the chin in a more massive manner. You can say all of the "products" are different, but they retail the same way, with the same labor.

No, web programming MIGHT be local/indigenous to SF. But embedded programing for iPhones, Android Apps, embedded controllers in 25,000 different companies and industries, etc, is also in SF BIG time! Software development IS stratified!
word-
210
1.6 / 5 (7) Sep 04, 2013
"If Capitalism and The American Dream have failed so badly..." - 210

I fix.

Capitalism and The American Dream have failed so badly.

You are welcome.

Vendi- you really SHOULD move back to your divine and beloved Russia under 'Pussy-Riot' Putin. Putin, also known as 'VLADIMIR-the GAY-IMPALER'. Or better yet, move to Syria, soon, just before the Tomahawks start to fall like rain..hurry Vendi...HURRY!
BAKOON
1.7 / 5 (6) Sep 04, 2013
Hmm, could it be that 210 is Obama_socks' token black sockpuppet? How can anyone mistake the idiot syntax and juvenile insults? As a REAL BLACK MAN, I know the American 'Dream' is the American 'delusion'. That doesn't mean it isn't a great nation, just not as great as it could be, sadly.

Just look at how SUCCESSFUL the Soviet Union was. They went from being a backwards un-industrialized agrarian monarchy to the first space-fairing nation in less than half a century. They then challenged the West's primacy for another half century, even though they never achieved anything resembling military parity.

The fact the USSR lasted as long as it did, not including its influence during that time, is a testament to the strengths of Marxism, even if poorly executed. Not even a tyrant like Stalin was able to implode the state. The USA is very lucky it has never had a Stalin, and anyone who thinks it isn't a possibility because of "American Exceptionalism" (a dumb concept) is a dumb person.
obama_socks
1 / 5 (6) Sep 04, 2013
LOL...BAKOON is no Black man. It's just another one of Theghostofotto1923's sucksuckpuppets, isn't that right, Blotto. No real Black man would call successful Black men like Thomas Sowell, Clarence Thomas, Walter E. Williams, Dr. Ben Carson, comedian Bill Cosby and many others "Uncle Toms".
Hell, even BHObama, Al Sharpton and Jesse Jackson or the president of the NAACP wouldn't DARE call them Uncle Toms.

But BAKOON the Baboon has done just that in the other thread while pretending to be Black. What a phony pos.

LOL hee haw hee haw hee haw
(snort)
BAKOON
1 / 5 (5) Sep 04, 2013
Yep, idiot racist Obama_socks is an expert on black culture. Let's all defer to him.

Well, that seems to be one of the main problems within the Black community. The culture is damaging to kids who just want to get a good education and make something of themselves when they graduate. Their lack of discipline shows up every time from both school and home. Discipline is key to success in America...and it is the Black community who will pay with the lives and futures of their children.
-Obama_socks, Insane Racist Idiot

Read more at: http://phys.org/n...html#jCp
zaxxon451
not rated yet Sep 05, 2013

This ALEC is not a nation, nor faces broad governance issues like a nation or state - and they are NOT a successful economy and the American Dream is very much that. Don't dodge the issue, go GET your example of success that applies to 'Dream' status...show me a Superpower that has allowed its people to live to pursue a 'dream'. Do not go get some little dinky nation that serves only 30 million people and place it on par with a country that has world-girdling effect and importance, go...go now...!

Take a breath friend, calm yourself. Perhaps you are so defensive because your arguments are weak?
I admire many countries that have not yet become a plutocracy, as ours has. Especially those where upward mobility is more than a "Dream" wrapped in a flag. When Capitalism is not strongly regulated it will ultimately fail, as we are seeing. Democracy has ceased to function in our country because our representatives (Republican and Democrat) serve no one but the rich.

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