I'm really curious to hear what the community has to say about this perspective. This is very compelling argument to me, but I've heard other compelling arguments on the other side. These arguments tend to go like this:
1. Big tech has gone unchecked for a long time and it's up to government and regulators to reign them in when it comes to privacy, offering sustainable compensation models for gig workers, limiting an increasing wage gap, and other inequities.
2. The rise of big tech has outpaced the city/area's ability to offer services at low costs. No other industry has seen such a quick rise and it's no wonder prices (including houses) have climbed so much.
I live in San Francisco, and have been disappointed, annoyed, and frustrated at many of the issues this article brings up, including high housing prices, homelessness, property crime, but it seems like an easy out to simply blame the government, or the tech industry exclusively. My guess is there's plenty of blame to go around and the answer might be more nuanced than finding a single scapegoat. What are people's thoughts?
I've lived in multiple states in cities that were at the top or near the top for annual population growth over multiple years- and it was fine.
Where I am now is #1 [0] and while property values are going up, there is plenty of housing being built, and since so much of Texas taxes comes via property taxes, there is an incentive for capping top end housing costs.
The city council has been approving higher density housing than the area has had historically, despite some grumbling from the SFH owners. The master plan is oriented around mass transit in an area historically devoid of it.
People complain about regulatory capture, but California has been captured by incumbent property owners and is now drowning in perverse incentives of their own invention. For a state that owes its success to innovation, there is zero innovation, let alone basic competence, coming out of the state/local government.
Austin as a larger metro area has an order of magnitude the amount of land that all of the peninsula has, with no water in the way.
Supporting housing growth through suburban sprawl is a story of most cities in the midwest & south in the US, and has completely different problems. I don't think the comparison will hold up.
The amount of livable land in a city like Mountain View is 12 square miles in city limits, Palo Alto is a massive 26! Austin is 271 square miles.
I agree the tax situation for private housing is nuts in the bay, but we should not pretend the bay and Austin face the same housing problems.
Reading through the 2 above parents, I was having similar thoughts. Problems are evident and if not addressed effectively, they become pretty serious. The solutions are not effective. Why not? The region is chock full of many of the world's greatest problem solvers.
It seems that the 'root cause analysis' is many times simply superficial. Too many homeless people? Give them homes. Too many addicts shoplifting to fund their habit? Decriminalize shoplifting. Cost of rental housing too high? Impose rent control.
This may be a consequence of the amount of time a politician is in office vs. the amount of time it really takes to solve these intractable problems. If a politician's term is 4 years, and it takes 12 years to solve a problem, actually identifying the root cause and devising a solution would be the end of their career in politics.
I'm pretty sure that if San Franciscans could elucidate what kind of a city they want San Francisco to be, no one would say they want it to be a haven for drug addicts and have the world's highest rents. And there are enough neighborhoods that just about all environs they'd list could be implemented somewhere within the city limits.
Given that San Francisco is not the kind of city that San Franciscans want it to be, I can only chalk it up to ineffective leadership by the persons setting and enforcing the rules. That's not solely the politicians. I'd guess it starts with leadership trying to satisfy everyone's issues without triage for practicality or an investigation of possible unintended consequences of their solutions.
Yes Salt Lake City has done it to much more success than SF. Of course, Utah and SLCers in general tend to also be more charitable than SFers, so it's hard to say what would happen in SF if they were to do this, given that the population is full of seeming misers.
"The city council has been approving higher density housing than the area has had historically, despite some grumbling from the SFH owners. The master plan is oriented around mass transit in an area historically devoid of it." ?
San Francisco's housing prices have risen the same percentages for the last 100 years straight.
People blame whatever recently changed in any city everywhere.
In one city it's wealthy people from China, in another city its tech, in another city its finance while the tech people earn the exact same amount as in the prior city and fly completely under the radar.
I do believe there is an effect from zoning and resistance to rezoning. Though people who think abolishing zoning is the answer should be forced to live for a time in any number of cities that have done this.
Little secret, it doesn't produce places most people want to live. Endless, monotonous grid, no community center, school next to a paper mill, etc
Definitely agree. We just haven't found the right mechanism that can balance creating beautiful communities for people to live without enabling NIMBY abuse.
IMO Prop 13 is at the root of nearly all of California's woes. It stifles housing development, causing high housing prices, homelessness, and property crime. It drives up the costs of offering government services. It increases inequality by disproportionately enriching a small group of landowners who had the good fortune to buy in the Bay Area or LA county 20-30 years ago, and impoverishes everyone else.
The inequality may not be as widespread as it appears to be. On HN earlier this year someone posted a link [1] which allows one to peruse property taxes anywhere in the state.
For this reply I picked a location in Daly City [2] to have a look. The black represent the highest property taxes and the green the lowest - there are few green bubbles. Take a look around, I'm sure there are areas like Huntington Beach [3] with absurdly low taxes, but I've not seen the actual analysis that favors the claims made either way.
Proposition 19 effectively eliminates the Parent to Child reassessment exemption, but it wasn't done for altruistic purposes. It was done to put more houses on the market for the real estate profession who funded the campaign to pass the proposition. Yes, this will increase property taxes and limit generational wealth transfer in the form of low property taxes, but it won't fix all the problems listed.
If you'd like to examine some potential problem areas in California I'd encourage you to google things like "Prevailing Wage Law" and similar.
Notice how there are a few outliers in red, making almost all the rest black. But look at the black ones. It ranges from $3000 to $25,000. And if you look at a row of roughly equal houses, you will see most of them are around $10K, while a few are $20K. ALL of them should be $20K+, if not for prop 13.
I've seen black ones go up to $47k. It's a crazy-broad range. Looking at the distribution of these numbers on a graph would be way more helpful than this type of visualization.
In addition to jedberg's comment about the "black"-range being far too broad, the problem is that the mere existence of Prop 13 incentivizes landowners to block new development. New landowners who are paying higher taxes compared to their neighbors would prefer even more appreciation to make up for it. Old landowners are happy to block new stuff because a) it's not like their taxes are going up anyway and b) scarcity makes their property values go up. In any rational market, large numbers of SFHs in Palo Alto, Menlo Park or Mountain View would have been built over with apartment buildings already.
Prop 19 is a decent start (I wasn't aware of it, so thanks) but it only passed last year so we'll have to wait and see what its effects are. More importantly, rental and commercial property is mostly not inherited so it's not covered.
This is what I wrote about Prop 19 back in October. It was both an expansion and partial repeal of Prop 13. It was supposed to work in tandem with Prop 15 (the other partial repeal of Prop 13):
Prop 19 (Allow people 55+ to take their Prop 13 tax breaks to new homes): Yes. You may ask why someone like me, who is strongly against Prop 13, would support a bill that seemingly expands Prop 13. This bill will encourage older people to vacate their large (and mostly empty) single family homes by allowing them to keep their low taxes and move to smaller single family homes or even fancy downtown condos. That alone would be a good thing, as it would free up needed housing for younger families that are growing and have kids. As long as Prop 13 exists, this will actually make things better by making it financially smart to leave your large unused home (which right now it is not).
But is also does more than that! There is also a partial repeal of Prop 13 hidden in this bill. It would force a tax reassessment when you inherit a property if you don’t move into it. This would mean a huge boost to local tax funding which goes towards schools, police, fire, etc. and closes a loophole that wealthy people use to help their kids stay rich by giving them rental properties that are only profitable because of their tax breaks. Also this prop is opposed by the Howard Jarvis association, which is usually an automatic yes for me, because Howard Jarvis is always wrong.
> It would force a tax reassessment when you inherit a property if you don’t move into it
So...a tax reassessment every 30-40 years? Don't get me wrong, it's better than the status quo. But let's not get carried away and think it's good. And the kids can still move into the place, keep the low taxes, and profit from the massive rise in value by using a HELoC to invest in relatively safe, stable index funds. It's free money.
The main missing word is "voters," which appears only once: "California's legislature has only made matters worse. A bill it enacted in 2019, ostensibly intended to protect gig workers, threatened to undo the business models of some of the state's biggest tech companies until voters granted them a reprieve in a November referendum."
Voters put California's legislators into office and voters continue to vote for dysfunctional policies, like the continuation of Prop 13 (https://techcrunch.com/2014/04/14/sf-housing/). While "bad government" is to blame, the proximate cause of "bad government" is still voters.
In your example from the article, it talks about how voters did vote in the company's best interests, which keeps those companies in line with the framework used in the rest of the country.
Was that an intentionally undermining of whatever point had set out to make?
Because I can dissect that part too, which is also the same as the rest of the country: nobody else really runs for these positions.
That's a great point... and in theory the government elected by the voters is supposed to reflect he will of those who put them into office. But in practice, I don't always see it panning out that way. Prop 22 being a good recent example. California voters elected a state assembly, which passed AB5. But then Prop 22, by direct referendum overturned AB5. So wouldn't this be a case where the government didn't act consistently with the will of the voters?
Nitpick: they didn’t overturn AB5. They just added gig workers to the list of exceptions. Essentially nullifying the whole thing.
I’d say that it’s not a direct comparison because of the immense lobbying effort by Uber, Lyft, etc. that convinced many that the companies would disappear overnight if Prop 22 didn’t pass. An uninformed populace is easier to sway (hence the whole representative democracy part) and they (the companies) took advantage of that for their own gain.
> So wouldn't this be a case where the government didn't act consistently with the will of the voters?
Not necessarily. To illustrate I will give you an even more confounding example from my own stage of Washington. Here, voters passed by referendum a transit proposal to build extensive light rail in the Puget Sound region.
The referendum was a very well put together one. It clearly stated the rail projects planned, how they would be funded and the tax implications involved.
All in all it was a good government wet dream. Responsible legislation, necessary for our growing traffic issues without bloat and funded with short term debt paid through clear taxes all passed by direct democracy.
Two years later another referendum passed by the voters left the transit projects in place but gutted one of the main taxes that was planned to pay for the project. The transit authority is now spending a good deal of time reorienting its project planning to account for this (on top of COVID concerns).
Why? Why would this happen? Honestly because voters are fickle, contradictory and inconsistent.
Very illustrative example. So in this thread, I'm reading the opinion that "it's not the fault of government, it's the fault of the voters". But your point (hope I'm not misrepresenting it), aligns more with "it's actually the voters who are fickle and don't always vote in a way that's aligned with their best interests".
Some would say, by supporting great public services today, funded by debt paid for by future generations (i.e. not them) that the voters voted in a way precisely aligned with their own best interests.
It's not so much that it's not aligned with their interests. It's more that voters wish to live free of consequences. But most of public policy is about trade-offs. Republicanism is supposed to help this. For example, the longer terms for senators and having them originally chosen by the legislature was supposed to insulate them from the public a bit so they could make people take their medicine.
Unfortunately, Republicanism broke down fairly quickly in America due to special interests and the separation of powers making it very easy to jam up a bill you didn't like. Basically anyone with a lobbyist has a veto power.
My prescription, we need Republicanism. We probably need to do away with referendums or subject them to a lot more parliamentary rules and rigor. To keep thisall from becoming 18th century guilded age corruption we need to do some other things too. We need to effectively kill the power of lobbying. We need to give state and federal representatives massive budgets so they can afford their own researchers. We probably need much larger legislatures, (hundreds or thousands of seats). And we need a new way to choose some of our representatives. Something that incorporates randomness to ensure regular people who live regular lives are actually participating.
That this is a thing makes me feel like way less of a crank. I've been telling anyone who will listen that we need randomness in our politics for like 7 years now. People often do not respond well.
Yeah afaik it was a thing during ancient Greek democracy, also the Viennese used a version of it....
But to add to these thoughts, coming from a society that people often consider as one of the better democracies (Switzerland) I find it very annoying the system of a majority winning... I mean in this day an age of potential cyber voting, if a suggestion was to get 50% or less of positive votes (such a a vote for free public transport in Geneva which got 27%) it should at least be tried out....
Also the inflation of bureaucracy needs to be addressed.. my suggestion would be that those voting get to share part time (if they want to) in the physical running of government as part of it's bureaucracy and receive payment ( it's often a sinecure... especially in these insecure times....
AB5 was in response to the California Supreme Court ruling in Dynamex v. Superior Court. In Dynamex, the court created a new 3-part test that replaced the old Borello standard from 1989. AB5 carved out exceptions in the wage law statute. If it wasn't enacted, most contractors would be considered employees under Dynamex.
> But then Prop 22, by direct referendum overturned AB5.
Voting can also be influenced by short term events.
1) AB5 was a garbage bill so it was a good target.
2) Uber/Lyft/et al poured a MASSIVE amount of scare tactic marketing into this. They also horribly misused their email and phone number database which, in my opinion, should get them drastically fined--I sure as hell didn't give them permission to use my email/phone number to be lobbied to.
3) This was combining with the fact that due to Covid a lot of people are getting zero assistance and, for them, the only money they may be making may be coming in from Uber/Lyft.
This is pretty much a perfect storm for getting a bad proposition through.
Well when elected officials misspend tax money, it's only an inevitability that propositions like prop 13 pass. People on here talk about prop 13 without having actually lived in CA before Prop 13. Before prop 13, there was still lots of bad governance, so voters decided to at least cap the amount they were going to spend on stupid policies.
Surprised no one on here has mentioned the obvious gorilla in the room: leftist "progressive" policies that make business impossible.
There are better ways to cap government income than what is effectively rent control for rich people.
A lot of areas have laws that only allow total revenue to go up by say 1% a year. So when they do tax assessments, they have to lower the property tax percentage for everyone equally to stay under the limit.
Sure there are but none had ever gotten to the point of actually being enacted other than prop 13. in a working state, legislators would have self discipline and not require direct propositions to be kept in line.
The voters voted that only people who are silly enough to not already own a house will foot the bill. If I own a multi million dollar house and pay $1k in taxes per year, why wouldn't I vote for all the tax increases in the world (save for repealing prop 13)?
Are HPE, Oracle and Palantir the "tech giants" we think of?
I have pretty negative opinions of their future, financially and otherwise.
I think there are plenty of things wrong with local governments, taxes, and policies - but I'm pretty sure each of these moves are easily explained financially rather than something "animosity".
California migration is going to turn the whole country blue by sheer population alone. The sparsely populated red counties do not have a chance. But at least there is space for the incomplete and perverse incentives to not be noticeable for a long time.
This narrative has been recycled for as long as I've lived and its not wrong but just continues to re-highlight what is actually just a constant current. California is a place where technology companies are birthed largely due to the educated talent here along with progressive values. When those companies become mature they start looking for tax cuts to bolster their established revenue model. Texas and the like is where these companies go to live out the rest of their lives
It's truly a piece of incurious writing. Basically a mashup of all the Andy Rooney type "California, am I right?" gripe articles you've ever seen. Turns out that everything wrong with California is all the things it tried to do to protect consumers and residents. Nevermind that state and local government is not a monolith and lots of bad consequences stem from competing interests creating a stalemate.
This is exactly my point. That Uber legislation, for example, OF COURSE it's going to eviscerate exploitative business models, as that is exactly what it was designed to do.
That privacy legislation means that I get a bit more control over my data than I had before.
I'm all for making life harder for businesspeople that fail or don't want to take into account the human consequences and second/third-order effects of their "innovative thinking" and market "disruption"
Is the same true of Tesla? I know of plenty of people who work or would like to work for Tesla. Another group of companies that haven't received as much attention in the recent "SF exodus" narrative are Google and FB. Google has been opening large offices outside of SF for years and is slowly contributing to the growing of tech hubs around the country. Google's Boulder office comes to mind as a good example.
I'm not aware of any large FB spokes, but FB remote work allowance might end up having a similar effect. Not to mention the many startups that have realized that the distributed model works fairly well if you know how to do it, and opens up a large talent pool. I currently work for such a startup and we don't plan on going to back to a central SF office model post pandemic.
Google is not part of any California exodus, but the opposite. In addition to building and buying outside the state, they have been aggressively expanding, not contracting, their square footage within California.
While it's catchy and hip to say that nobody wants to work for these companies, the reality is hundreds of thousands do. Both your example companies may not be popular with the cool kids and have their own controversies, but they offer great pay, benefits and consist of a lot of smart people.
They don't really have great pay, though, do they? They can't afford to pay what qualified employees demand in California. So they move to a state where the average expected salary is lower.
Oracle's reputation was of abysmal pay for senior employees, for decades. I'm willing to bet that economically they should have moved a long time ago, but Larry Ellison's pride kept them in the Bay Area. He designed the campus buildings to look like database icons, that's not something you give up easily.
The labor market has been catastrophically expensive for over a decade. They dealt with it. If anything, the flood of new wait-me-too CS grads and bootcamp graduates over the past couple years is great for legacy employers willing to slup up anyone who can write a line of code.
The tax market is the new problem. Now they are leaving.
HPE and Oracle didn't leave the state, they moved their headquarters. The Oracle campus in Redwood City and the HPE campus in San Jose will remain, and they continue to hire locally. Also of note, both companies are incorporated in Delaware and that will continue to be the case.
> These two traits - poor governance and animosity toward business - have collided calamitously with respect to the city's housing market.
Yeah it has nothing to do with powerful property owners lobbying against loosening zoning because they're worried a housing project will "ruin" the neighborhood and decrease property values.
> 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.
This feels pretty hyperbolic and unreasonable to frame it this way. Startups have been trying to "disrupt" markets by doing things that are in gray areas, or sometimes are outright illegal, and they cause all kinds of problems and outsource the management and cleanup of the problems they cause to the communities and cities. Littering scooters on sidewalks everywhere and taking no responsibility for user safety isn't the kind of experimentation we need.
California labor is super expensive, and HPE's stated reason for moving is cost savings. If anything, I might suggest that the Bay Area's friendliness to tech companies is the very reason the salaries there are so high. People in San Francisco have been complaining and protesting for at least a decade about the tech migration there, and the complete pricing out of the blue collar workforce. I think this article might have it completely wrong.
Japan has zoning laws at the country level, and they are much more sane than local zoning laws. Basically, local zoning says "this piece of land can be used for one thing". Japan's laws say "this piece of land can cause a maximum nuisance of X, but it can have all these different things on it". And then it's up to the developers to decide if building a multi-unit building would more profitable than a single family home.
It is very difficult to build anything in SF. The city doesn't have any available land, therefore you need to demolish existing structures and build higher. There is a loud and vocal community of activists that refuse to allow new construction because of gentrification. Additionally, many won't allow retail businesses that are not local. SF prevents retail chains of a certain size in some neighborhoods. Also, the city has a law that allows any resident to challenge a change of use permit or new construction, no matter where they live in the city. These cases ultimately come up before the Board of Supervisors which tend to attach requirements and restrictions for construction leading to expensive delays.
The problem is the direct proposition system. It makes good governance impossible. Most states require the legislature to approve all direct propositions, but California does not.
Prop 13 was voted in by people who did not understand the long term ramifications of what they were doing. All they heard was "lower taxes!". The partial repeal of Prop 13 on the ballot failed (and the expansion of it passed!) just this November, again by people who don't understand the ramifications of what they are doing and just hear "lower taxes!".
Prop 13 is single handedly destroying this state. 49 other states manage to get by without an equivalent and don't have old people getting priced out of their homes from tax increases. Yet somehow that is the red herring people use to keep Prop 13 around.
Because of Prop 13, people won't sell their house, middle class people are subsidizing rich people, and in some cases, the profit being made on rentals is purely because of the low tax. If not for Prop 13, the rental would be breakeven and it would make more sense to sell.
Prop 13 also encourages people to vote against expansion in housing supply, because they want their home price to go up, up, up! Especially since their property tax will be nearly flat.
Local areas are starved for money because of long term owners. Here in the Silicon Valley I have found homes valued at over $4M that pay less than $1000 a year in property tax (whereas someone just buying that home would pay about $30,000).
Pretty much every problem in this state can be traced to Prop 13. Everything else is just a poor workaround.
>> The problem is the direct proposition system. It makes good governance impossible. Most states require the legislature to approve all direct propositions, but California does not.
So the problem is...democracy?
You want things that other people don't want. Your claim is that they are too unintelligent to understand the long term ramifications of their choices.
I would definitely vote for something like Proposition 13 in my state, if I had the chance. You disagree. Why is one person one vote a bad rule, and how many votes should you get as opposed to mine?
Yes, exactly. No system of direct democracy has worked in the history of the world. Even here on HN, it is moderated, and some people have more voice than others.
> Your claim is that they are too unintelligent to understand the long term ramifications of their choices.
It's not that they aren't intelligent enough, it's that they don't have the background to make an informed decision. A politician specializes in understanding the ramifications of law (at least in theory). You as a voter do not have time to learn everything necessary to understand what you are voting for. It's a full time job and then some.
Just like you are perfectly capable of fixing your own car, but you don't have the time to spend learning how to do it properly. Politicians focus on policy and their long term affects, and you do whatever it is that you do.
> Why is one person one vote a bad rule, and how many votes should you get as opposed to mine?
One person one vote is fine for selecting representation, but we select representation specifically because we expect them to be experts in policy.
> You as a voter do not have time to learn everything necessary to understand what you are voting for. It's a full time job and then some
Then I can outsource that learning to a political party, the same as if I didn't have an option to vote on a direct proposition. I can trust the political party, and let them tell me how to vote on the proposition.
I have more choices with the direct proposition. Outsource it to a political party, or decide myself. Without the direct proposition, I can only outsource it to a political party.
I would rather have the choice. You would rather me not have that choice.
By the way each proposition is unpacked in the voter guide mailed out each year, it just sounds like the legislature is passing the buck to the voter when each prop says "placed on the ballot by the legislature" or something along those lines.
I thought that was why we voted the folks into office? Not just to collect a check because they won a popularity contest and meme'd on Facebook hard enough.
Hello! Oregonian neighbor here. You mean fourty-eight other states, at least. In Oregon, we the people are delegated the ability to change the state constitution and statutes. Sometimes this is used for stupid things, but often it allows us to override a stubborn legislature. Recall that we have a problem where sometimes our Republican representatives like to take vacation in Idaho with paramilitary insurrectionists; nonetheless, we can still be leaders in drug decriminalization.
(Nearly every one of your statements is wrong, but I figured that if we all chip in a single paragraph, then together we can help fix your post.)
As I read the discussion, one interesting question came to mind. There are so many cities that want to be the next "tech hubs", and many of them have been promoting that label (with or without merit) for years. I can't tell you how many articles like this one [0] I've read.
But in reality, many of these cities are making an honest effort to live up to that label by attracting talent, corporate HQs and investment to make these claims real. Texas' tax policies are one example [1]
In contrast, I see SF and the broader Bay Area making moves in the opposite direction. One such example is the new CEO wealth tax [2], along with others that make SF seem hostile rather than welcoming. It's no surprise that companies want to leave.
Do other people see it this way too? Has SF or the Bay Area enacted policies to attract or retain tech talent, investment and innovation? Or is the valley's success due to a strong network effect that has been self reinforcing (more talent means more investment means more talent, etc). Have California, SF or Bay Area policies in the last 20 years truly encouraged the flourishing of the tech industry, or has it happened despite these governments? Really curious to hear what people think.
Surprised nobody has pointed out that the premise seems suspect. Does a few very large organizations mean companies in general are fleeing or does it say something about these companies?
There are people who desperately want this to be true or believed, but it doesn’t seem supported by evidence.
Everybody with a modicum of common sense was saying this for the past decade and more I lived in this god damned quasi-communist state. Now, when Larry Ellison and Elon Musk flee, it makes it to the headlines. Good grief.
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[ 3.9 ms ] story [ 134 ms ] thread1. Big tech has gone unchecked for a long time and it's up to government and regulators to reign them in when it comes to privacy, offering sustainable compensation models for gig workers, limiting an increasing wage gap, and other inequities.
2. The rise of big tech has outpaced the city/area's ability to offer services at low costs. No other industry has seen such a quick rise and it's no wonder prices (including houses) have climbed so much.
I live in San Francisco, and have been disappointed, annoyed, and frustrated at many of the issues this article brings up, including high housing prices, homelessness, property crime, but it seems like an easy out to simply blame the government, or the tech industry exclusively. My guess is there's plenty of blame to go around and the answer might be more nuanced than finding a single scapegoat. What are people's thoughts?
Where I am now is #1 [0] and while property values are going up, there is plenty of housing being built, and since so much of Texas taxes comes via property taxes, there is an incentive for capping top end housing costs.
The city council has been approving higher density housing than the area has had historically, despite some grumbling from the SFH owners. The master plan is oriented around mass transit in an area historically devoid of it.
People complain about regulatory capture, but California has been captured by incumbent property owners and is now drowning in perverse incentives of their own invention. For a state that owes its success to innovation, there is zero innovation, let alone basic competence, coming out of the state/local government.
[0]: https://www.bizjournals.com/austin/news/2020/07/26/austin-ar...
Supporting housing growth through suburban sprawl is a story of most cities in the midwest & south in the US, and has completely different problems. I don't think the comparison will hold up.
The amount of livable land in a city like Mountain View is 12 square miles in city limits, Palo Alto is a massive 26! Austin is 271 square miles.
I agree the tax situation for private housing is nuts in the bay, but we should not pretend the bay and Austin face the same housing problems.
It seems that the 'root cause analysis' is many times simply superficial. Too many homeless people? Give them homes. Too many addicts shoplifting to fund their habit? Decriminalize shoplifting. Cost of rental housing too high? Impose rent control.
This may be a consequence of the amount of time a politician is in office vs. the amount of time it really takes to solve these intractable problems. If a politician's term is 4 years, and it takes 12 years to solve a problem, actually identifying the root cause and devising a solution would be the end of their career in politics.
I'm pretty sure that if San Franciscans could elucidate what kind of a city they want San Francisco to be, no one would say they want it to be a haven for drug addicts and have the world's highest rents. And there are enough neighborhoods that just about all environs they'd list could be implemented somewhere within the city limits.
Given that San Francisco is not the kind of city that San Franciscans want it to be, I can only chalk it up to ineffective leadership by the persons setting and enforcing the rules. That's not solely the politicians. I'd guess it starts with leadership trying to satisfy everyone's issues without triage for practicality or an investigation of possible unintended consequences of their solutions.
Has this actually been attempted?
"The city council has been approving higher density housing than the area has had historically, despite some grumbling from the SFH owners. The master plan is oriented around mass transit in an area historically devoid of it." ?
Austin?
People blame whatever recently changed in any city everywhere.
In one city it's wealthy people from China, in another city its tech, in another city its finance while the tech people earn the exact same amount as in the prior city and fly completely under the radar.
It's just scarcity, no matter how it is sliced.
Little secret, it doesn't produce places most people want to live. Endless, monotonous grid, no community center, school next to a paper mill, etc
For this reply I picked a location in Daly City [2] to have a look. The black represent the highest property taxes and the green the lowest - there are few green bubbles. Take a look around, I'm sure there are areas like Huntington Beach [3] with absurdly low taxes, but I've not seen the actual analysis that favors the claims made either way.
Proposition 19 effectively eliminates the Parent to Child reassessment exemption, but it wasn't done for altruistic purposes. It was done to put more houses on the market for the real estate profession who funded the campaign to pass the proposition. Yes, this will increase property taxes and limit generational wealth transfer in the form of low property taxes, but it won't fix all the problems listed.
If you'd like to examine some potential problem areas in California I'd encourage you to google things like "Prevailing Wage Law" and similar.
1. https://www.officialdata.org/ca-property-tax
2. https://www.officialdata.org/ca-property-tax/#37.69076107721...
3. https://www.officialdata.org/ca-property-tax/#33.65955360268...
https://www.officialdata.org/ca-property-tax/#37.26178563229...
Notice how there are a few outliers in red, making almost all the rest black. But look at the black ones. It ranges from $3000 to $25,000. And if you look at a row of roughly equal houses, you will see most of them are around $10K, while a few are $20K. ALL of them should be $20K+, if not for prop 13.
Prop 19 is a decent start (I wasn't aware of it, so thanks) but it only passed last year so we'll have to wait and see what its effects are. More importantly, rental and commercial property is mostly not inherited so it's not covered.
What's "prevailing wage law"?
Prop 19 (Allow people 55+ to take their Prop 13 tax breaks to new homes): Yes. You may ask why someone like me, who is strongly against Prop 13, would support a bill that seemingly expands Prop 13. This bill will encourage older people to vacate their large (and mostly empty) single family homes by allowing them to keep their low taxes and move to smaller single family homes or even fancy downtown condos. That alone would be a good thing, as it would free up needed housing for younger families that are growing and have kids. As long as Prop 13 exists, this will actually make things better by making it financially smart to leave your large unused home (which right now it is not).
But is also does more than that! There is also a partial repeal of Prop 13 hidden in this bill. It would force a tax reassessment when you inherit a property if you don’t move into it. This would mean a huge boost to local tax funding which goes towards schools, police, fire, etc. and closes a loophole that wealthy people use to help their kids stay rich by giving them rental properties that are only profitable because of their tax breaks. Also this prop is opposed by the Howard Jarvis association, which is usually an automatic yes for me, because Howard Jarvis is always wrong.
So...a tax reassessment every 30-40 years? Don't get me wrong, it's better than the status quo. But let's not get carried away and think it's good. And the kids can still move into the place, keep the low taxes, and profit from the massive rise in value by using a HELoC to invest in relatively safe, stable index funds. It's free money.
Voters put California's legislators into office and voters continue to vote for dysfunctional policies, like the continuation of Prop 13 (https://techcrunch.com/2014/04/14/sf-housing/). While "bad government" is to blame, the proximate cause of "bad government" is still voters.
Was that an intentionally undermining of whatever point had set out to make?
Because I can dissect that part too, which is also the same as the rest of the country: nobody else really runs for these positions.
I’d say that it’s not a direct comparison because of the immense lobbying effort by Uber, Lyft, etc. that convinced many that the companies would disappear overnight if Prop 22 didn’t pass. An uninformed populace is easier to sway (hence the whole representative democracy part) and they (the companies) took advantage of that for their own gain.
Not necessarily. To illustrate I will give you an even more confounding example from my own stage of Washington. Here, voters passed by referendum a transit proposal to build extensive light rail in the Puget Sound region.
The referendum was a very well put together one. It clearly stated the rail projects planned, how they would be funded and the tax implications involved.
All in all it was a good government wet dream. Responsible legislation, necessary for our growing traffic issues without bloat and funded with short term debt paid through clear taxes all passed by direct democracy.
Two years later another referendum passed by the voters left the transit projects in place but gutted one of the main taxes that was planned to pay for the project. The transit authority is now spending a good deal of time reorienting its project planning to account for this (on top of COVID concerns).
Why? Why would this happen? Honestly because voters are fickle, contradictory and inconsistent.
So what are we left with? :(
Unfortunately, Republicanism broke down fairly quickly in America due to special interests and the separation of powers making it very easy to jam up a bill you didn't like. Basically anyone with a lobbyist has a veto power.
My prescription, we need Republicanism. We probably need to do away with referendums or subject them to a lot more parliamentary rules and rigor. To keep thisall from becoming 18th century guilded age corruption we need to do some other things too. We need to effectively kill the power of lobbying. We need to give state and federal representatives massive budgets so they can afford their own researchers. We probably need much larger legislatures, (hundreds or thousands of seats). And we need a new way to choose some of our representatives. Something that incorporates randomness to ensure regular people who live regular lives are actually participating.
I think it's called stockocracy :-)
But to add to these thoughts, coming from a society that people often consider as one of the better democracies (Switzerland) I find it very annoying the system of a majority winning... I mean in this day an age of potential cyber voting, if a suggestion was to get 50% or less of positive votes (such a a vote for free public transport in Geneva which got 27%) it should at least be tried out....
Also the inflation of bureaucracy needs to be addressed.. my suggestion would be that those voting get to share part time (if they want to) in the physical running of government as part of it's bureaucracy and receive payment ( it's often a sinecure... especially in these insecure times....
Voting can also be influenced by short term events.
1) AB5 was a garbage bill so it was a good target.
2) Uber/Lyft/et al poured a MASSIVE amount of scare tactic marketing into this. They also horribly misused their email and phone number database which, in my opinion, should get them drastically fined--I sure as hell didn't give them permission to use my email/phone number to be lobbied to.
3) This was combining with the fact that due to Covid a lot of people are getting zero assistance and, for them, the only money they may be making may be coming in from Uber/Lyft.
This is pretty much a perfect storm for getting a bad proposition through.
Surprised no one on here has mentioned the obvious gorilla in the room: leftist "progressive" policies that make business impossible.
A lot of areas have laws that only allow total revenue to go up by say 1% a year. So when they do tax assessments, they have to lower the property tax percentage for everyone equally to stay under the limit.
I have pretty negative opinions of their future, financially and otherwise.
I think there are plenty of things wrong with local governments, taxes, and policies - but I'm pretty sure each of these moves are easily explained financially rather than something "animosity".
They aren't a monotonic blue voting block. And they're not all moving to rural Wyoming.
That privacy legislation means that I get a bit more control over my data than I had before.
I'm all for making life harder for businesspeople that fail or don't want to take into account the human consequences and second/third-order effects of their "innovative thinking" and market "disruption"
Who wants to work at HPE or Oracle? Almost literally nobody.
I'm not aware of any large FB spokes, but FB remote work allowance might end up having a similar effect. Not to mention the many startups that have realized that the distributed model works fairly well if you know how to do it, and opens up a large talent pool. I currently work for such a startup and we don't plan on going to back to a central SF office model post pandemic.
https://www.theguardian.com/artanddesign/2017/jul/23/inside-...
https://officesnapshots.com/2018/10/15/nvidia-headquarters-s...
Oracle's reputation was of abysmal pay for senior employees, for decades. I'm willing to bet that economically they should have moved a long time ago, but Larry Ellison's pride kept them in the Bay Area. He designed the campus buildings to look like database icons, that's not something you give up easily.
The tax market is the new problem. Now they are leaving.
Yeah it has nothing to do with powerful property owners lobbying against loosening zoning because they're worried a housing project will "ruin" the neighborhood and decrease property values.
This feels pretty hyperbolic and unreasonable to frame it this way. Startups have been trying to "disrupt" markets by doing things that are in gray areas, or sometimes are outright illegal, and they cause all kinds of problems and outsource the management and cleanup of the problems they cause to the communities and cities. Littering scooters on sidewalks everywhere and taking no responsibility for user safety isn't the kind of experimentation we need.
California labor is super expensive, and HPE's stated reason for moving is cost savings. If anything, I might suggest that the Bay Area's friendliness to tech companies is the very reason the salaries there are so high. People in San Francisco have been complaining and protesting for at least a decade about the tech migration there, and the complete pricing out of the blue collar workforce. I think this article might have it completely wrong.
Prop 13 was voted in by people who did not understand the long term ramifications of what they were doing. All they heard was "lower taxes!". The partial repeal of Prop 13 on the ballot failed (and the expansion of it passed!) just this November, again by people who don't understand the ramifications of what they are doing and just hear "lower taxes!".
Prop 13 is single handedly destroying this state. 49 other states manage to get by without an equivalent and don't have old people getting priced out of their homes from tax increases. Yet somehow that is the red herring people use to keep Prop 13 around.
Because of Prop 13, people won't sell their house, middle class people are subsidizing rich people, and in some cases, the profit being made on rentals is purely because of the low tax. If not for Prop 13, the rental would be breakeven and it would make more sense to sell.
Prop 13 also encourages people to vote against expansion in housing supply, because they want their home price to go up, up, up! Especially since their property tax will be nearly flat.
Local areas are starved for money because of long term owners. Here in the Silicon Valley I have found homes valued at over $4M that pay less than $1000 a year in property tax (whereas someone just buying that home would pay about $30,000).
Pretty much every problem in this state can be traced to Prop 13. Everything else is just a poor workaround.
So the problem is...democracy?
You want things that other people don't want. Your claim is that they are too unintelligent to understand the long term ramifications of their choices.
I would definitely vote for something like Proposition 13 in my state, if I had the chance. You disagree. Why is one person one vote a bad rule, and how many votes should you get as opposed to mine?
Yes, exactly. No system of direct democracy has worked in the history of the world. Even here on HN, it is moderated, and some people have more voice than others.
> Your claim is that they are too unintelligent to understand the long term ramifications of their choices.
It's not that they aren't intelligent enough, it's that they don't have the background to make an informed decision. A politician specializes in understanding the ramifications of law (at least in theory). You as a voter do not have time to learn everything necessary to understand what you are voting for. It's a full time job and then some.
Just like you are perfectly capable of fixing your own car, but you don't have the time to spend learning how to do it properly. Politicians focus on policy and their long term affects, and you do whatever it is that you do.
> Why is one person one vote a bad rule, and how many votes should you get as opposed to mine?
One person one vote is fine for selecting representation, but we select representation specifically because we expect them to be experts in policy.
Then I can outsource that learning to a political party, the same as if I didn't have an option to vote on a direct proposition. I can trust the political party, and let them tell me how to vote on the proposition.
I have more choices with the direct proposition. Outsource it to a political party, or decide myself. Without the direct proposition, I can only outsource it to a political party.
I would rather have the choice. You would rather me not have that choice.
I thought that was why we voted the folks into office? Not just to collect a check because they won a popularity contest and meme'd on Facebook hard enough.
(Nearly every one of your statements is wrong, but I figured that if we all chip in a single paragraph, then together we can help fix your post.)
But at the end of the day, Prop 13 has proven to be the worst of the worst time and again.
But in reality, many of these cities are making an honest effort to live up to that label by attracting talent, corporate HQs and investment to make these claims real. Texas' tax policies are one example [1]
In contrast, I see SF and the broader Bay Area making moves in the opposite direction. One such example is the new CEO wealth tax [2], along with others that make SF seem hostile rather than welcoming. It's no surprise that companies want to leave.
Do other people see it this way too? Has SF or the Bay Area enacted policies to attract or retain tech talent, investment and innovation? Or is the valley's success due to a strong network effect that has been self reinforcing (more talent means more investment means more talent, etc). Have California, SF or Bay Area policies in the last 20 years truly encouraged the flourishing of the tech industry, or has it happened despite these governments? Really curious to hear what people think.
[0] https://www.theatlantic.com/sponsored/jpmc-2018/are-these-ci...
[1] https://www.investopedia.com/articles/personal-finance/10141...
[2] https://apnews.com/article/san-francisco-approves-taxes-on-c...
There are people who desperately want this to be true or believed, but it doesn’t seem supported by evidence.