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A path to dismantling Bay Area tech gentrification and revitalizing the Central Valley
by M Mac
Friday Jan 24th, 2014 7:53 AM
The gentrification of the Bay Area is unsustainable. Tech workers are being used by their employers as cannon fodder in the class war. People want democracy, not charity. Tech companies have to pay their taxes. They also need to use this thingie called the Internet to spread their operations out to places that need the economic activity, like the Central Valley. Bonus: High-speed rail.
The protests of vehicles carrying employees from their homes in San Francisco to high-tech companies on the Peninsula are about evictions and traffic congestion, but they are fundamentally reactions to plutonomy and elitism.

If I pull over into a Muni stop to check my route or take a call, I am subject to a $271 fine, even if there is still space for the bus. What are commonly termed “Googlebuses” are neither buses nor shuttles. They are coaches, the same behemoths that one might take on a luxury tour of the Grand Canyon or Yosemite. When they idle at the curb, city buses must wait. Even partially blocking a stop is more than inconvenient: using the mobility lift when the bus cannot pull completely to the curb is often impossible and always against SFMTA regulations, forcing passengers with disabilities to hold up the entire bus until the stop is clear or double back from a coach-free stop somewhere farther down the line. Cyclists are doubly endangered: pushed out into traffic by parked leviathans and run into parked cars by moving ones that are oblivious to them.

The large number of these coaches clog peak-hour traffic in the most congested parts of the city because tech workers can afford to move into the most desirable neighborhoods. Rather than taking cars off the street, they enable gentrification and increase private vehicle traffic because these places would not be desirable if the employees had to drive from the Mission to Mountain View or Cupertino and back every day. By driving rents up and degrading public transport, those who do not have private coach privileges (but are fortunate enough to own a car and have a job) have no alternative but to drive long commutes into the city from the increasingly distant places where they can afford housing. And let’s not forget that these coaches have internal combustion engines that consume great quantities of fuel. With hundreds of them idling in our bus zones and crawling along our highways every day, we are hardly addressing climate change or ground-level air quality.

At no time did the companies that charter these private fleets come forward to try to work out a plan that would accommodate or even acknowledge the needs of the public. They didn’t volunteer to enter into a partnership to increase capacity and connectivity on Caltrain, Samtrans and other existing public transit, they just came in and squatted on public property. They chose what is surely the most expensive option in the long run in order to justify an elitist corporate culture. In order to dismiss the many, they cynically put the few - their own employees - in the firing line.

“Knowledge workers” have a similar career trajectory to professional athletes: great pay that seems like it will flow in steadily forever and goofy perks for the few years when they are naive enough to value them. But without the jump to management they face a future of high job turnover and long-term financial insecurity. Just like the NFL, there are few positions to move into and heavy competition to get them before one ages out of the desirable range for a youth-obsessed industry. They are cajoled into working long hours with gourmet lunches, recreation facilities and luxury transport, but this conceals the ruthlessness of hiring and firing with the whims of project cancellations and fashions in management methodology.

Such perks are all economic benefits for which neither the employers nor the workers pay payroll or sales taxes. A $20 meal and $13.50 round trip on Caltrain every day comes to a subsidy of $8,375 per year. At 20%, the Federal government alone is losing nearly seventeen hundred dollars a year per person. A rough guess of 15,000 employees yields more than $25 million at a time when we can’t seem to find the revenue for decent schools, unemployment benefits or reducing the backlog of wounded veterans awaiting medical care.

By offering these commercial services in house, the local merchants who are enticed with visions of droves of affluent customers are also deprived of business. The employer becomes their competition, leaving small businesses with a progressively smaller and more impoverished customer base at the same time as their costs rise and property taxes go up to pay what the subsidized firms do not.

While Google has been at the forefront of evading civic responsibility with stunts like anchoring secretive barges in the bay and ferrying their workforce on the water, they are hardly alone. Zynga and Twitter extort local tax breaks with promises of goading their employees into service projects that would be more effectively and democratically accomplished through a public process. Charities and activities are selected by management on the basis of corporate goals and convenience rather than meeting the needs of San Francisco as determined by experienced public entities through an open process that is accountable to the people. In an industry that crows about “results based” this and “accountability” that, there isn’t even have a mechanism for gauging results: the citizen’s board that is supposed to oversee this exchange is forbidden from knowing what the tax bills would have been because this is deemed sensitive business information. Corporate personhood entitles them to privacy available to few who are endowed with mere biological personhood.

Google’s fleet of jetliners get tax-free fuel at Moffett Field. Tesla sets Palo Alto and Burlingame against each other in a bidding war and then collects both subsidies while insisting that the point of sale for tax purposes is the buyer’s home address. The tech sector is in the company of Walmart, Amazon, Fedex and other less directly tech-based businesses in socializing costs while privatizing profits. We feel this industry’s offenses most acutely because the greatest concentration of such companies in the world is on the Peninsula and because they are so good at it but it is a systemic problem that threatens to overwhelm our democracy.

A responsible approach would be for these miscreants to invest in the communities they affect rather than strongarm and starve them. $1 per stop is a joke: a single ride on Muni costs $2. But address the problem at it’s root, which is demand. Coaches are insulin, and using a once-amazing city turned into Disneyland to entice the naive is like soothing the agony of diabetes with chocolate cake.

So here is my prescription for Silicon Valley:

1. Pay your taxes. Don’t be petulant babies: you got seed money and low interest loans from DoD, DoE, NSA and other Federal agencies for your startups. As you grew you got traffic patterns changed by cities and state-level incentives to stay in California at a time when the public sector at all levels was in budgetary crisis. We all need the money to produce your next crop of geniuses and so that someone is around who can afford to buy your nifty stuff. Playing the “pull up the ladder” game just makes you enemabags.

2. Spread the wealth. If you have enough employees to require a fleet of coaches, there either needs to be housing available for them or you need to disperse them across a number of facilities. You are responsible for the economic impact of your business, even the aspects you do not acknowledge. Why do you need everyone on site every day anyway? Aren’t you the people that claim to have bestowed a work-anywhere, hyperconnected universe upon everyone else? Put your money where your mouths are.

The Central Valley is close, cheap and desperately needs an economy based on more than corrupt water transfers and the occasional prison. It is also the route of the high-speed rail project that many of you claim to support and which is in danger of failure because of the poison pills of center-outward construction and the flyover effect. By setting up many small satellite campuses in places like Bakersfield and Fresno, you would give real incentives to complete it on time. You would provide the residents already there with the promise of adding a low-impact, high value industry to an agricultural economy that is unsustainable in the face of climate change. You would have the space and resources to build the most modern and environmentally benign facilities possible without a bolus of affluent outsiders causing gentrification.

The possibilities for partnership with schools like UC Merced and CSU Stanislaus are significant. With your participation these would become destination schools for research and technology. By offering real mentorship - not charity wheedled out of your employees - to local children you could significantly affect some of the areas of deepest poverty in the state.

If the HSR buildout is successful, Central Valley towns would be very attractive places to live and work. It is a beautiful area with much to offer your staff: natural beauty for the outdoorspeople, real farming for the urban farmers, rustic charm for those who yearn to see a building without a Starbucks logo on it. Both San Francisco and LA would be less than two hours away and the Sierra ski slopes under three. This would be by real public transport, not private fleet.

Spurring the HSR would reduce the number of car trips and airline flights taken by many more people than just your employees, which would be a real step toward dealing with climate change. By diversifying the economies of the Central Valley there would be less dependence on agriculture. We could restrict irrigation to the most appropriate crops instead of growing high-market-value crops that waste water, obviating the peripheral canal boondoggle. That really would be ”working to advance the wiser use of energy and natural resources” as the Eric and Wendy Schmidt Foundation advertisements on NPR are constantly crowing.

In places like Fresno your employees can buy 4-bedroom Victorians with cash and lovingly restore them, earning them their lumberjack shirts and weird facial hair. Who wouldn't prefer that to the anxiety of not knowing if they can hold onto a condo on Valencia through the next real estate bubble? "But wait!" I hear you say, “No one from the graduating class of Brown or MIT has ever heard of Fresno!” Just hand them a Steinbeck or Saroyan novel and try to retain your faith in American youth.

3. Quit with the lather-rinse-repeat of hiring and layoffs. Part of the reason the Bay Area is so overcrowded is that you constantly bring in new hires from elsewhere only to fire them en masse a year or two later. Guess what? THEY DON’T LEAVE. By then they have ties here, relationships and property with little equity. Contrary to how it may look from mahogany row, they don’t just disappear but must find another gig to keep them afloat.

In the face of this, it is particularly egregious for you to claim that you need more H1-B workers because there is no one in this entire country who can do the job. Using the threat of layoffs and resulting immediate cancellation of their visas is not just a shakedown of foreign workers, it is blatant intimidation and wage suppression of those who are citizens and permanent residents.

Hire from within. This is Silicon Fucking Valley! There are plenty of talented engineers, project managers and programmers already in the area who are unemployed. You know they are good because they have worked for you before and you fired them to make your quarterly reports look good. Many of them have housing already, or at least did before they were laid off.

4. Treat your employees with respect. Pay them over the table and not in squishy chairs or propeller beanies or stock options that can only be exercised once the execs and investment bankers have already rorted the IPO. Let them buy their own food and do their own laundry like grownups do, and allow them the leisure time to do it. Developing productive, collaborative teams requires real support: support for their family lives, their ongoing education, their long-term goals. You really will get better results if your people consider you a trustworthy partner and not an gimmicky cult whose capriciousness obliges them to maximize their short-term personal advantage.

If you have to see everyone at the office all day in order to get results it is not a technical problem but one of  dysfunctional corporate culture. A relationship of trust results in employees who can be relied on to work effectively anywhere they choose through this amazing technology you have contributed to.

Those who promote and profit from the distributed workplace have an obligation to lead by example. Use your wealth and political power to diffuse the hyperconcentration of tech sector jobs while revitalizing the economy of the state that has given you so much. Then use the same enticements you use now to concentrate everyone here to encourage your employees spread out to places like Detroit and Appalachia and enrich those desperate economies with their properly taxed lunch money. That would show due appreciation of everything that has been given to you. And it really would take cars off the road.

Comments  (Hide Comments)

by Dan Waterhouse
Friday Jan 24th, 2014 4:10 PM
Is likely dead as of November. An initiative to kill it was cleared for circulation two weeks ago. It won't be hard to gather the needed signatures to put it on the November ballot. Given that 65% of likely voters oppose it, I'd say it's going to be cancelled. People in the Central Valley prefer that Amtrak service be improved instead.
by honshin9
Friday Jan 24th, 2014 4:37 PM
so your answer is gentrify the central valley? How is it better that it happen there?
by mmac
Saturday Jan 25th, 2014 8:04 AM

I agree that HSR is doomed if nothing is done. But if big tech companies get behind it there will be a turnaround because they get what they want. They say they want it, so they need to prove it.

The ranchers of the Central Valley are against it because it dilutes their power. They have a stranglehold on the politics, economics and water and are loath to share that. They want more Amtrak because that is effectively local bus service which keeps their labor force within the valley. The north-south rail is largely west of the Coast Range, so most people who use Amtrak between the Bay Area and LA only see the Central Valley in between Paso Robles and Salinas. It basically keeps the insiders in and the outsiders out, which enforces the status quo.

HSR would bring in people and commerce from LA and the Bay Area. It would also allow those who are stuck in low-wage jobs in the Valley access to better jobs and education in the cities. Of course the ranchers are opposed to this: they gain by keeping large swathes of the population in dire poverty. But I think most of the people would be for it if they saw it as a way out of a dead end. Part of the problem is that many of them cannot vote, either due to lack of citizenship or involvement in the criminal justice system.


I tried very carefully to avoid the prospect of gentrification because I agree that it is a major part of the problem. This is why the facilities are supposed to be small: no one needs a 10,000-person self-contained Googleplex, especially a place like Modesto or Bakersfield. But many little offices of 100 or so scattered throughout the Valley, staffed by long-term employees who do their shopping in town and become part of the community, might warm the economy without overheating it.

Valley cities are often very strapped for housing at the low end but have empty foreclosures on the higher end, which is what the techies would be buying. With careful planning - encouragement of foreclosure purchases and heavy penalties for buying an inhabited home - it could work. Keeping a tight rein on that is going to be the hard part.
by Dan Waterhouse
Saturday Jan 25th, 2014 10:17 AM
MMac. Paso Robles ain't in the Central Valley. That's Central Coast turf. Our Amtrak service (the San Joaquin) is the third busiest in the country. I agree with you the farmers aren't happy with high speed rail, but their unhappiness has nothing to do with the labor force-it has everything to do with land. What DOES impact their labor force is higher paying house construction jobs where, if you're not legally in the country, you get paid under the table-something that can't happen with the rail work because of the federal money.

If the initiative I mentioned earlier makes it to the ballot, I'm likely to vote in favor of killing high speed rail. Not because I disagree with the concept, but the current proposal has been totally mishandled and needs to start over. Personally, I'd love to see our Amtrak service upgraded to higher speeds and more trains.
by mmac
Saturday Jan 25th, 2014 6:36 PM
Paso Robles is not in the Central Valley. The Central Coast has a lot of economic similarity but it is geographically separate.

The San Joaquin goes to Bakersfield but stops there, making it a non-starter for many people going between LA and the Bay Area because there has to be a bus connection for the last leg. It is also usually equivalent in travel time, if not longer, than taking the Coast Starlight between LA and Oakland.

Leaving the practical considerations of scheduling and comfort aside, the class identity problems are considerable. Few tech types who would consider Ellising a family from their home will take a multi-hour bus trip without wifi unless they are sufficiently enthralled with the romance of freighthopping. I think most of those were replaced by brogrammers long ago. On the other hand, taking a spiffo new high-speed train with connectivity and cushy seats is both nifty technology and has limited association with poor people. It is therefore is more acceptable.

Whether it is construction or ag work, it is all about keeping it under the farmers' control. Diversifying the economy is a threat to them for exactly the same reason that the HSR is - it takes the decisions out of their power.

I am actually against the current HSR as planned too. It is a boondoggle. But if the high tech companies decide they have an interest in making it usable, they might actually make it work. Aside: I hope without Musk's maglev, though, because maintaining 450 miles of vacuum is insane (unless you own the company selling power to the pumps).

However much those without clout may want a project, it isn't going to get done unless a plutocrat backs it. If we're just going to demand revolution and a brighter tomorrow with no leverage, we might as well stay home and save ourselves the notes in our NSA files.

The greater boondoggle is the peripheral canal. That is sure to be built unless it can be demonstrated that the need for water will reduce over time. The power of the Central Valley farmers comes from their water rights and it would set their control in stone. In the absence of other less water-intensive industries, they have a lock on the economy. Since affecting water rights is a pretty slim bet, adding in other business seems like the way to break their stranglehold.

Please tell me what what you would prescribe for the Central Valley. What would be the best way to reduce poverty? How would you build HSR, if at all? Do you believe that continuing to separate the interior from the coast (or urban from rural) is useful, detrimental or neutral?

I appreciate this dialog and am learning a lot. Thank you.
by Ant
Wednesday May 28th, 2014 8:30 AM
Move tech campuses to "Bakersfield and Fresno"? What kind of stuff are you on? No one will go to these toxic, polluted dumpsters to get asthma and cancer. How about you move there yourself.