There are easier locations to live on $15/hr in California and the USA than Silicon Valley. Some of the people featured in the article have vehicles which implies mobility. I wish the article focused more on the reasons people choose to stay in a place with a ridiculous cost of living that they can't afford. That seems like the real story to me. I'm sure there are valid reasons like family or other things but it's not mentioned at all.
Maybe it's hard for them to find work outside of the area and they are living paycheck to paycheck. So any gap in employment would sink them.
It's hard to get out of an area when you're economically distressed. Cutting that tiny lifeline is a massive risk. This is the same problem keeping poor rural people stuck in poor rural areas.
I don't think that's OP's point, the article should talk more about the reason why the housing is so expensive, not just say "because of silicon valley." I would like to know what the problem is as well, as I was under the impression that salaries where connected to the cost of living (i.e. If someone needs a security guard, they should pay comparable to the cost of living in the area their employees would live.)
For home prices: Tech companies pay high wages, and can afford to follow cost-of-living increases (and have to, because demand for tech employees in SV is higher than the supply). Home prices go up because NIMBYism won't allow housing supply to increase along with demand.
If someone needs a security guard, they'll pay the least that gets them someone competent to do the work. For the employer, the question isn't directly connected to the standard of living, it's "can I get a body in the door for this rate of pay?" I'd suspect the pay won't go up, as long as the answer's "yes".
> I don't think that's OP's point, the article should talk more about the reason why the housing is so expensive, not just say "because of silicon valley."
I don't think so;
> I wish the article focused more on the reasons people choose to stay in a place with a ridiculous cost of living that they can't afford.
Perhaps that's open to interpretation, but I took it to mean, why are staying if they can't afford to?
Those locations don’t pay $15/hr. if you can find a job, and you probably can’t. Employment is rising in densely populated areas and not so much in rural areas. This is a little different on the east coast, but that’s a more significant moving investment.
Other services like healthcare in rural areas has eroded to barely existent. I can speak from experience in Oregon.
Moving costs money, something they don’t have.
Finding a new job costs time and money. They’ve got neither.
Unskilled labor in Houston may not get $15/hour, but jobs are pretty easy to come across. I know multiple people who really aren't good at their job (one's a waitress, one works in retail) but they frequently get new jobs when they lose the old (and sometimes have more than one at once). It's not hard to find a $700 apartment here either.
Interesting that you bring up Houston. As someone who lives in Austin and frequents Houston (and have friends living in Houston), I really really liked the city for its great housing at affordable prices, amazing food and nightlife (even though one has to drive fucking everywhere with inhumanly aggressive drivers). Has your opinion changed after the recent Hurricane?
I live in an area where I was unaffected (north of Houston). It really only affects where I'd buy a house in the future, as I'd ensure I'm not near a bayou or creek (my current home, a lease, is outside of that danger zone). If you're open to where you live, and aren't stuck on a certain hot spot, I still think it's a great (if hot with the traffic you mentioned) place to live.
It's interesting you bring up healthcare. My wife's cousin is currently working as a travelling nurse. He get shipped off to some rural part of the country for 8 weeks to (mostly) work the over night shift at various rural ERs.
Apparently it's near impossible to fill the roles otherwise.
Why not stop participating altogether? It's not hard to leave this system of slavery[1]: it just requires sacrifice.
You don't need to live on the major coasts or in a major city. You can live off the land in the woods, hunting and growing your own clean food, drinking clean water, etc.
Which is very much not cheap. Not to mention, while you're driving from point A to point B, you're not bringing in income. So where are you gonna get the money for gas and food?
It's going to take at least a week, and a lot of gas. We're talking about people who already aren't bringing in much, and so likely don't have anything saved up.
Have you never loaded everything you own in a car and moved before? It does not take a week. And driving 300 miles takes 6 hours in an RV, not 7 days. Within a 300 mile radius of SV is everything from LA to Reno to Eureka.
Well, except maybe in St. Louis, which set a $15 minimum wage only to have it nullified by the state of Mizzureh.
They technically exist, but it's like...would you ever think of opening a business somewhere like Illinois? That's like opening a tin of meat in a school of pirhannas.
Fair enough, to each their own. I like the Midwest a lot, don't get me wrong. It's just not the sort of place I'd go if I wanted to employ people.
More the sort of place I'd go if I wanted to run a small workshop for a year or two. Rent is cheap, and in my experience the people are friendlier than around the coasts so you won't go insane if you aren't willing to take on a second job called 'trying and failing to meet people.'
I did get the feeling it was because I was a white guy, in a lot of cities, but...is it wrong to say that at least they were friendly? As opposed to condescending everyone equally? Probably; I don't really feel comfortable with that line of reasoning...or maybe I just am dealing with mild discrimination and it's hard because so far I've basically been pampered through life on that count? It seems more likely that I'm just overly sensitive, but...fuck, the looks I get from people I've never seen before...I don't know, people are so complicated
But here's the thing: SV still needs 7-11 clerks, still needs fast food workers, still needs coffee baristas, and still needs all of those lower income positions. Automation is nowhere near eliminating all of those positions yet. So if all those people left, where would those businesses hire from?
If more people said "F* this, I don't want to live out of my car" and then drove away to someplace cheaper, business owners would have to raise wages to attract people to either stay or move to the area.
What I'm interested is why has the equilibrium been established where people who aren't making enough to have a decent standard of living choose to stay there.
These articles always find insane numbers. People pack into apartments and houses before leaving. I lived in Santa Clara right near the Caltrain tracks, which is in no way a ghetto area. But 2-3 bedroom apartments frequently had 4 or more cars and ~2-4 adults and 1-2 kids. Our apartment was a 3 bedroom 2 bath and was 2500 and we had 3 of us and 3 cars. This was my first apartment after college with two friends, was cheap for me as a junior dev.
They'd pay more for what's left. The customers would in turn pay more. It'd be a crisis then apparently, but one the hiring class could subvert through higher wages across the board.
> Some of the people featured in the article have vehicles which implies mobility
A good friend is a mechanic in the East Bay and services many people out in SF and the entire bay too. Before 2008's housing bust, about 90% of customers had 2 cars and routinely paid in checks or cash (yes really, even for a $3.5k transmission). After 2008, most people got rid of the second car, only ~15% have more than one now, and the credit card usage is about 95%. You can argue something about 2% cash back or something, but the fact is that they don't have the money to cover a brake job, let alone a new OBC.
So, no, most Bay Area families do not have mobility anymore, as they are both using the same car to drive to different workplaces. They can't move, as they don't have the money and trying to 'solve the 2-body problem' is very difficult.
I can't cite the study or article, but I remember reading that even in times of war or famine; people just simply refuse to move. If my memory is good, the study mentioned that less than 15% of the population will move even in these terrible conditions.
The article was basically about the evolutionary fitness of immigrants who came to the US.
As a filthy filthy hobo I can share my own reasons: nice weather, free college, interesting people, not too hard to find gig work, and surrounded by natural beauty. It's one of the best places to be homeless. Weather and ascetics are a big factor IMO. Even filthy hobos can enjoy the lawns of the Presido, the jagged hills of the city, the almost ominous, creeping fog, pregnant with mystery... and you know, the crack scene is totally popping.
Leaving everything and, more importantly, everyone you know is not an easy choice to make. There are many, many reasons—human reasons that pure economics can't capture—to stay in a place. A sense of home. Social support. Simple attachment. Maybe even just stubbornness. Point is, this is about way more than money.
Adding to the problem, the NIMBYs everywhere mean that no one builds new RV parks anywhere and the extant RV parks ramp up rents and regulations (your RV has to less than 10 years old) to push out the lower income people. This exact thing happened to me in Austin.
I hear the same argument on this site every time poverty and homelessness in Silicon Valley is brought up, but I really don't understand it. Massive capital concentration is leading to only a few cities in the country experiencing economic growth, and your solution is to just build more housing in those few areas?
Why not do something about the capital concentration? Why not do something to push some of those jobs into the Midwest? That would sure lower housing demand in those few cities, and would lead to a more equal country overall.
The answer to your question is poverty. Several studies have shown how poverty has serious negative mental consequences, and how poverty makes everyday tasks significantly more challenging. Especially for someone who grew up poor and is poor as an adult.
> Recent studies suggest that the mental strain undertaken by the poor far surpasses previously expected amounts.
This strain can easily affect one’s ability to succeed in school and/or work, and can even influence one’s ability to pay bills on time. Specifically, poverty affects such cognitive functions as decision-making, memory, focus, patience and even awareness. The scientific reasoning for these shortcomings is linked to the brain’s finite ability. Thus the limited brainpower resulting from poverty infringes on the ability of such people to complete everyday tasks.
The problem with many people’s understanding of the stress of poverty is that they neglect to include the added stress that most U.S. adults face on a daily basis. Such triggers include work, money, health, relationships, poor nutrition, media overload, and sleep deprivation. In fact, 76 percent of U.S. adults correlate work and money to their top stress indicators.
Massive capital concentration is one of the reasons the valley, SF, and to a lesser extent Seattle, Austin, and New York, are creating so much.
Capital concentration leads to higher pay, which leads to smart people coming, which leads to cool products, which leads to an increase in the economic productivity of a society.
I don't see why anybody should "push" jobs away. That would make both the jobs and their employers less desirable.
There are few instances where central government control of economic allocation led to innovation. Even China and Singapore generally is pretty laissez faire about who does what where. It's not like the Korean government is trying to push industry out of Seoul, even though real estate there is insane.
Free markets created the Bay Area and SF (arguably the lack of enforcement of non-competes did), but that's another example of the government backing off. It's not like Communist Russia was a hotbed of innovation.
The issue with this is that it's going to create massive political instability if there are a few megacities with massive poverty in every other state. There are already signs that our political system is already destabilizing. What makes you think this wouldn't amplify that?
The alternative is government mandated poverty. The government hardly ever creates wealth. They can create the conditions for wealth creation by getting the heck out of the way.
To be a bit dramatic, Venezuela, PRK, Sudan, and Cuba all have incredibly low wealth inequality. Except for the rich and corrupt, everybody else has just about the same as everybody else, which is nothing, based on government policies. Hong Kong is cutthroat with high levels of inequality, but it's also an engine of economic growth. Would you really rather like in Sub Saharan Africa than Hong Kong?
EDIT:
And massive wealth and capital concentration brought us Amazon and Google. In exchange for newly minted millionaires being "equal" to us, would you rather live in a world without those technologies - next day shipping and Google Maps and Search?
"The government hardly ever creates wealth. They can create the conditions for wealth creation by getting the heck out of the way."
Yes, we're aware that's how it works in shitty novels about trains from the 1950's.
Here in the real world, every single technological innovation in the iPhone was created by the US Government, or with the assistance of US government-funded basic research. This book breaks the whole thing down: https://en.wikipedia.org/wiki/The_Entrepreneurial_State
Google Maps is a particularly terrible example. It wouldn't exist without GPS, a technology invented by the US government.
Hong Kong's government puts billions of dollars a year into technology research. That's not a good example, either. Furthermore, HK has lower income inequality than Nigeria, Rwanda, Mozambique, Guinea-Bissau, Madagascar, Burundi, The Gambia, Swaziland, Botswana, CAR, Sierra Leone and Namibia: https://en.wikipedia.org/wiki/List_of_countries_by_income_eq... . So your statement "everybody else has just about the same as everybody else" in sub-Saharan Africa is total bullshit.
Japan and Scandinavia have relatively low rates of income inequality (especially compared to sub-Saharan Africa). Are you saying those countries are less innovative than Namibia (highest income inequality in the world)?
Finally, the idea that the sole difference between "Sub Saharan Africa" (a region that encapsulates over a billion people and over 40 countries which you regard as a monolith) and Hong Kong is due to "government policies" is childishly ignorant. Africa is not a country.
As for the government never creating wealth, most innovations that came out of government basic research came out of the DoD/partially NASA. Although mostly the DoD. Are you advocating for more defense funding, and then I'd be all behind you.
As for your income inequality chart, it shows exactly what I'm talking about. One of the highest "equality" ratings of the Gini coefficient is the Netherlands, where the Jante law holds sway. https://en.wikipedia.org/wiki/Law_of_Jante
As I said, those are countries who seem like they're stagnating. Do you really want countries with low outcome equality vs. equality of opportunitity vs countries who actually let you excel and keep the fruits of your labour and skill? Outcome inequality is not a bad thing.
Also note that in your gini chart, most of the countries which are awful have no statistics. Are they equal or just a blank slate that you can project your own feelings on?
> Do you really want countries with low outcome equality vs. equality of opportunitity
This is a commonly given argument, but does not apply to the US -- it's nowhere near a country of equal opportunity. I'd be more open to the argument if you'd include items like no inheritance and no private schooling, to really give a more equal footing -- but I'm guessing these are not up for discussion. Thus, a certain amount of outcome equalizing is absolutely necessary.
Incorrect. One of the highest drives of most human peopls is to make sure that their efforts will benefit their offspring.
Once you take that away, whether through inheritance tax or forbidding of public schooling or even presence of more books in the household, what incentive are you giving them to produce? Do not equalize outcome.
I think we agree then that equal opportunity isn't realistic, and perhaps even shouldn't be attempted. Thus, please avoid making this kind of simple argument of opportunity vs. outcome, as that's not at all what is being suggested.
Which cities are you thinking of? I bet you're leaving out a bunch of cheaper places that are also growing in the southern US/Texas region, among others.
Part of me is empathetic with this whole story, obviously. But another part of me finds it strange that there is such a huge emphasis on the homelessness situation in SF. It's as if we're only paying attention to this because of the huge inequality density in the city. But the truth is, homelessness is a problem everywhere. It just doesn't feel like an efficient (from a utilitarian perspective) use of resources to focus efforts here instead of where the money can act as the biggest lever. It's as if we mostly care about reducing the visual appearance of the problem, than care about most effectively minimizing the problem in aggregate.
> It's as if we mostly care about reducing the visual appearance of the problem
There are real public health consequences to high concentrations of people living without proper sanitation -- see the ongoing, major hepatitis outbreak in San Diego, for instance.
It's paid attention to pretty much everywhere. Down in southern California, the homeless problem in LA and Orange County gets covered pretty regularly.
I suspect you hear more about SV homelessness here because this is a pretty SV heavy forum.
> Mountain View, a city of 80,000 which also is home to Mozilla and 23andMe, has committed more than $1 million over two years for homeless services, including money for an outreach case manager and a police officer to help people who live in vehicles.
Why are local governments treating these people as dysfunctional when the dysfunction is in the government in its ability to provide an environment that is safe, stable, and affordable for otherwise functional members of society.
I don't get it. Is your premise is that every person making minimum should be able to live anywhere they want in the US, and if they can't the government is responsible?
This isn't really an abstract problem that requires reductio ad absurdum type arguments. I grew up in the UK and I visit the valley sometimes. There are several things you immediately notice:
1) Every building is incredibly short.
2) Every building is spaced very far apart.
3) Every road is incredibly wide.
Even fairly unimportant roads, the sort that have rinky dink little cafes on them, will often have three lanes in each direction or more.
The Valley has a homelessness problem because the people who live there refuse to let anyone build tall, dense housing complexes. There's so much space here you could crush the homelessness and poverty problems instantly by just relaxing zoning rules, it wouldn't even take a social housing programme. But instead all the space is taken up with tiny low rise buildings surrounded by enormous parking lots.
Yes, but why should they? If a community likes wide roads, low traffic, short buildings, are they somehow obligated to knock down those buildings so that other people can live there?
There’s a reasonable claim that once you live somewhere, you’re entitled to an affordable way to remain there.
Providing this entitlement requires eliminating everyone else’s freedom to move there. Obviously CA can’t directly enact an immigration policy, but affordable housing activists are focused on moving from market to lottery/waiting list allocation of housing, where longtime locals are prioritized. “Affordable housing.” Trouble is, they are only succeeding at this for new buildings; outsiders are still able to outbid locals for old buildings, which are most of the market. But stronger rent control could stop that.
This is mostly the result of the severe underdevelopment of new housing in the last 20 or 30 years, due to neighborhoods preventing any sort of development to stymy gentrification. The situation is made worse by the disincentivisaiton of selling any property because of Prop 13. Why would you ever move if your property taxes would increase by an order of magnitude? All the market distortion has led to predictable outcomes, the new tech employees living in the old crappy housing for exorbitant rents, and the poor pushed onto the streets.
I’m not very familiar with Prop 13, but can speak for situations in Oregon which seem quite different. Maybe prop 13 is why.
Quickly surging economies create active markets which encourage owners to sell, renovations to happen, and old tenants to be removed for the purpose of raising rent. In Portland in the past 3-4 years, there were quite a few studies done on how this happens and how it is especially risky in places with less families because those left without housing suddenly often have no place to run to.
Going back to your point about Prop 13, the Portland issues I just described seem to be recovering by a lot in the last 6 months. I am pretty sure it wasn’t necessarily because of new building though, because the new building in Portland is nearly all luxury condos.
Automobile infrastructure simply does not scale. Roads and parking are a massive waste of space and ongoing maintenance. Gas stations are superfund sites waiting to happen.
The entire car-culture and the industries that profit from that culture would need to be fought to improve transportation along with new buildout, and to the large extent, car culture has won (parking is part of local building codes, and a large part of state/federal funding for roads).
I'd like to hear how transport could be improved without transitions to mass-transit and increased walkability.
What I see as a major part of the problem is zoning laws that require commercial buildings to be grouped away from residential areas. So you have a large number of people commuting to the same area every day and none of them are able to live within walking/cycling distance. If US zoning were more like Japan, where the intended use is a "maximum" limit not an exclusive limit. So you'll see houses and commercial buildings mixed together, so it's possible to live close to work, reducing the number of cars on the road.
> I do think some NIMBYs would be less NIMBY if improvements in transportation took place at the same time as new buildings.
There is opposition in San Francisco [1] (and Oakland) to development directly on top of BART stations... I don't think parking is the primary concern for those opposing new construction in the bay.
This nightmare has been building for 4 decades and it's finally reaching a breaking point.
Here's my recommendation:
- Work with builders to remove all regulations that prevent building.
- Zone much more residential areas
- Remove all height restrictions
- invite builders to build and offer them legal protection from NIMBYs
- dezone some of non-residential zoning, if needed: In places where there's limited space, we need to move those companies to locations that can handle the influx of workers
- declare certain areas as innovation building zones: Remove all building regulations and let start ups build whatever residential areas in any way they can. Let innovation blossom without hamstringing it with countless regulations.
There are good reasons why this trillion dollar PROBLEM/pain point/industry has been completely ignored by venture capitalists and entrepreneurs. We need to understand those reasons and mitigate those concerns.
"- Work with builders to remove all regulations that prevent building."
This would end disastrously. "All those earthquake safety regulations, those are really preventing me from building." "Those environmental regulations, the ones that stop me from polluting everywhere, those are really preventing me from building."
"- declare certain areas as innovation building zones: Remove all building regulations and let start ups build whatever residential areas in any way they can. Let innovation blossom without hamstringing it with countless regulations."
We can't simply assume that removing those regulations will result in a disaster. Look at the actual data. Find, the regulations which limit the most building - maybe they're not even safety related. many parts of CEQA for instance does nothing to help the environment but has prevented huge amounts of housing. And for those that are safety related, maybe there's a way to alter them or at least get rid of them just temporarily until the homeless emergency has been mitigated. Anything is better than leaving people out on the street - in any case, that's not a decision you or i should make, but rather the people it affects.
It's not impossible to build taller buildings than what you get in the valley that are still earthquake safe. Even just burying parking lots underground would probably 1.5x the amount of space available for building.
"And for those that are safety related, maybe there's a way to alter them or at least get rid of them just temporarily until the homeless emergency has been mitigated. Anything is better than leaving people out on the street"
I don't buy that argument for a second. Take, for instance, the Grenfell tower fire. Regulations were ignored, and 68 people died because of it.
Yes, it is. But ignoring regulation, much of which is there for a very good reason, is not the answer. The last thing anyone wants is for many homeless people to move into these buildings, and have them die because they weren't built to withstand an earthquake, or had improper cladding and went up in flames.
But isn't this a false dichotomy? I don't think anyone is arguing the shortage of homes in the valley is due to earthquake or fire proofing. You can build earthquake resistant skyscrapers and SF is full of skyscrapers, but places like Mountain View seem to top out at 3 floors. The regulations in question seem to be more about keeping things low rise for aesthetics sake (assuming you agree that the bay area is pretty as is, which I don't).
The main problem is population growth. Even if housing is built specifically for poorer and lower income individuals, middle class families looking for hosuing will inevitable trickle in causing demand and prices to rise naturally. Once again poor individuals will be on the street. The same cycle keeps occurring in cities across America. Properties designed for the poor end up getting bought by middle and upper class individuals, seen this in Washington D.C. and New york firsthand.
