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What if Californians just decided they want their communities to look the way they do now? Switzerland could make everything less expensive if they imported ch

What if Californians just decided they want their communities to look the way they do now? Switzerland could make everything less expensive if they imported cheap labor and cut the minimum wage. But they elect not to. I guarantee that if you made California cheaper you'd attract more people and then it'd just become more expensive again. There's not enough space there to accommodate all the people in the country that would live there if they could afford it.

tostitos1979 10y ago
Well .. maybe the CS industry needs to all agree to jointly move away to a state that has a better attitude to the problems faced by young people. As someone in their mid-30s, I'll never be able to afford a house in Mountain View (despite earning an income there, spending money there, renting there, etc.).
- cylinder 10y ago
  It starts with employees demanding higher wages. That'll get their attention and they'll move offices to cheaper cities. My partner just rejected a job offer because housing is too expensive. This is a six figure salary and management level but after taxes and rent on a one bedroom apartment there's not much left over to make working worth it.
  - st3v3r 10y ago
    No, they won't. The VC money is still firmly in SV, and it doesn't appear to be going anywhere. As long as the meme that you have to be in the Valley in order to get access to VCs is mostly true, then the companies will stay there. Get PG and YCombinator to start moving out of the Valley, and then you'll see companies more willing to do so. Of course, those states will have to enact things similar to California when it comes to employee rights, like refusing to enforce most non-compete agreements.
    - tostitos1979 10y ago
      You are completely right. If YC moved to a city with a lower cost of living ... now that would be making a bold statement. How about it Sam?
  - xienze 10y ago
    But you see the spiral that leads to, don't you? Wages increase -> local economy adjusts to absorb higher incomes (i.e. everything, including housing, becomes more expensive) -> "we need to demand higher wages" -> wages increase -> ...
    - nickparker 10y ago
      That's only a spiral if you expect organizations to stay in Mtn. View no matter what. At some point your spiral reaches a point where Mtn. View based companies are beaten out by companies in sane cities with sane costs of living, and then Mtn. View reaches an equilibrium.
pjlegato 10y ago
That is almost what happened. During the 1970s and 1980s, Californians collectively decided they didn't like the changes that were going on and that they wanted their state to be frozen as it was circa 1965 forever, in both physical and economic senses, so they enacted a bunch of regulations designed to achieve that -- Prop 13 that froze property taxes, rent control in San Francisco, stricter zoning laws that prevented almost any medium or high density development in both the suburbs and in the urban cores. These regulations had numerous unintended and unforeseen consequences, however, which collectively had the effect of exacerbating rather than curing all of the economic problems that were changing society in the 1970s.
- 1_2__3 10y ago
  If that were true I'd expect to see something of a continuous spectrum of suck extending from the 1970's to today. But instead it's not like that at all - the bay area is hugely prosperous and happy until the late 2000s when a confluence of factors led incredibly rapidly to where we are today. There is some truth to what you're claiming, but I'm tired of this "California just wanted to freeze itself in the 1960s and look how wrong they were." In truth everything was going pretty good for everyone until the last decade or two.
  - pjlegato 10y ago
    The various land regulations such as Prop 13 and rent control were overtly billed as "ways to stave off all the social change that's been happening" when they were debated and passed in the 70s and 80s. It's not a guess or some sort of conspiracy theory. Review the newspaper polemics of the time. It was quite openly the goal. You can see exactly that continuous spectrum of decay in California in many places. The state has become ever more polarized into rich and poor, with less and less middle, during that entire time. This is partially a process that was going on everywhere in the US, but all the extra regulation in California that was designed to halt that process actually made it worse. The California middle class has been massively eroding since the '70s. Before that, you could drop out of high school and still get a job that would lead to you owning a house within a few years. Now, owning a house is impossible for almost everyone. The land regulations that restricted supply have made long term housing prices grow far faster than the national average: http://www.doctorhousingbubble.com/wp-content/uploads/2015/08/US-San-Francisco-California-median-home-sales-prices-1971-2015-05.png http://www.doctorhousingbubble.com/wp-content/uploads/2015/0... Huge tracts of formerly middle class suburbs near San Francisco and LA have become massive ghettoes -- where you still have to pay half a million dollars or more to buy a house next to thugs who openly sell crack 24 hours a day, where people are shot a couple of times a month. Where else in the US do you pay half a million dollars for a house in the ghetto? The middle class jobs have mostly evaporated -- other than sinecures in California's vast bureaucratic and public employee apparatus, in which case you get a job for life with a powerful, politically-connected union to keep you from ever being fired for any reason. Good luck getting one of those unless you have a friend or relative who's already there. Yes, things are great if you happen to be a high skilled tech worker in San Francisco during the late 90s or from circa 2010 to present, but this is a very small fraction of the population. Most Californians who don't have advanced computer programming skills only got squeezed harder by that influx of new money pushing up real estate prices still further. And we haven't seen anything yet. Just wait till the "smart farm" trend really kicks in: http://www.economist.com/technology-quarterly/2016-06-09/factory-fresh http://www.economist.com/technology-quarterly/2016-06-09/fac... Soon, very soon, robots will be picking all the produce in the Central Valley, and there will be millions of newly unemployed low-skilled workers flooding into San Francisco and LA looking for work.
stvswn 10y ago
Californians (I am one) can certainly decide this. Many actively hold this view. If we decide this, we have to live with the consequences, which I believe are indefensible from a moral standpoint. We're making it untenable for lower income families to live and work here. As far as your second point, I don't think you know that demand for housing is so inelastic that the clearing price for $/square foot would remain static regardless of supply. I have a feeling it would retreat if more supply came on the market.
hx87 10y ago
Demand =/= quantity demanded. If people demand a certain quantity at a certain price, they will demand more at a lower price. That "more" isn't going to make the object's price go up. > What if Californians just decided they want their communities to look the way they do now? If that, rather than selfishly increasing their property values at public expense, is their true motivation, they can do this in a way that satisfies everyone. Drive out all the businesses that bring in the money chasing after housing.

tostitos1979 10y ago

Well .. maybe the CS industry needs to all agree to jointly move away to a state that has a better attitude to the problems faced by young people. As someone in their mid-30s, I'll never be able to afford a house in Mountain View (despite earning an income there, spending money there, renting there, etc.).

cylinder 10y ago
It starts with employees demanding higher wages. That'll get their attention and they'll move offices to cheaper cities. My partner just rejected a job offer because housing is too expensive. This is a six figure salary and management level but after taxes and rent on a one bedroom apartment there's not much left over to make working worth it.
- st3v3r 10y ago
  No, they won't. The VC money is still firmly in SV, and it doesn't appear to be going anywhere. As long as the meme that you have to be in the Valley in order to get access to VCs is mostly true, then the companies will stay there. Get PG and YCombinator to start moving out of the Valley, and then you'll see companies more willing to do so. Of course, those states will have to enact things similar to California when it comes to employee rights, like refusing to enforce most non-compete agreements.
  - tostitos1979 10y ago
    You are completely right. If YC moved to a city with a lower cost of living ... now that would be making a bold statement. How about it Sam?
- xienze 10y ago
  But you see the spiral that leads to, don't you? Wages increase -> local economy adjusts to absorb higher incomes (i.e. everything, including housing, becomes more expensive) -> "we need to demand higher wages" -> wages increase -> ...
  - nickparker 10y ago
    That's only a spiral if you expect organizations to stay in Mtn. View no matter what. At some point your spiral reaches a point where Mtn. View based companies are beaten out by companies in sane cities with sane costs of living, and then Mtn. View reaches an equilibrium.

pjlegato 10y ago

That is almost what happened. During the 1970s and 1980s, Californians collectively decided they didn't like the changes that were going on and that they wanted their state to be frozen as it was circa 1965 forever, in both physical and economic senses, so they enacted a bunch of regulations designed to achieve that -- Prop 13 that froze property taxes, rent control in San Francisco, stricter zoning laws that prevented almost any medium or high density development in both the suburbs and in the urban cores. These regulations had numerous unintended and unforeseen consequences, however, which collectively had the effect of exacerbating rather than curing all of the economic problems that were changing society in the 1970s.

1_2__3 10y ago
If that were true I'd expect to see something of a continuous spectrum of suck extending from the 1970's to today. But instead it's not like that at all - the bay area is hugely prosperous and happy until the late 2000s when a confluence of factors led incredibly rapidly to where we are today. There is some truth to what you're claiming, but I'm tired of this "California just wanted to freeze itself in the 1960s and look how wrong they were." In truth everything was going pretty good for everyone until the last decade or two.
- pjlegato 10y ago
  The various land regulations such as Prop 13 and rent control were overtly billed as "ways to stave off all the social change that's been happening" when they were debated and passed in the 70s and 80s. It's not a guess or some sort of conspiracy theory. Review the newspaper polemics of the time. It was quite openly the goal. You can see exactly that continuous spectrum of decay in California in many places. The state has become ever more polarized into rich and poor, with less and less middle, during that entire time. This is partially a process that was going on everywhere in the US, but all the extra regulation in California that was designed to halt that process actually made it worse. The California middle class has been massively eroding since the '70s. Before that, you could drop out of high school and still get a job that would lead to you owning a house within a few years. Now, owning a house is impossible for almost everyone. The land regulations that restricted supply have made long term housing prices grow far faster than the national average: http://www.doctorhousingbubble.com/wp-content/uploads/2015/08/US-San-Francisco-California-median-home-sales-prices-1971-2015-05.png http://www.doctorhousingbubble.com/wp-content/uploads/2015/0... Huge tracts of formerly middle class suburbs near San Francisco and LA have become massive ghettoes -- where you still have to pay half a million dollars or more to buy a house next to thugs who openly sell crack 24 hours a day, where people are shot a couple of times a month. Where else in the US do you pay half a million dollars for a house in the ghetto? The middle class jobs have mostly evaporated -- other than sinecures in California's vast bureaucratic and public employee apparatus, in which case you get a job for life with a powerful, politically-connected union to keep you from ever being fired for any reason. Good luck getting one of those unless you have a friend or relative who's already there. Yes, things are great if you happen to be a high skilled tech worker in San Francisco during the late 90s or from circa 2010 to present, but this is a very small fraction of the population. Most Californians who don't have advanced computer programming skills only got squeezed harder by that influx of new money pushing up real estate prices still further. And we haven't seen anything yet. Just wait till the "smart farm" trend really kicks in: http://www.economist.com/technology-quarterly/2016-06-09/factory-fresh http://www.economist.com/technology-quarterly/2016-06-09/fac... Soon, very soon, robots will be picking all the produce in the Central Valley, and there will be millions of newly unemployed low-skilled workers flooding into San Francisco and LA looking for work.

stvswn 10y ago

Californians (I am one) can certainly decide this. Many actively hold this view. If we decide this, we have to live with the consequences, which I believe are indefensible from a moral standpoint. We're making it untenable for lower income families to live and work here. As far as your second point, I don't think you know that demand for housing is so inelastic that the clearing price for $/square foot would remain static regardless of supply. I have a feeling it would retreat if more supply came on the market.

hx87 10y ago

Demand =/= quantity demanded. If people demand a certain quantity at a certain price, they will demand more at a lower price. That "more" isn't going to make the object's price go up. > What if Californians just decided they want their communities to look the way they do now? If that, rather than selfishly increasing their property values at public expense, is their true motivation, they can do this in a way that satisfies everyone. Drive out all the businesses that bring in the money chasing after housing.