California has been riding the California Dream since the Gold Rush. Breathtaking views, cities that are cultural magnets, generous tax breaks for industries du jour, and liberal subsidies for the poor and middle class keep the Dream alive and the people coming.
An excellent publication by the California Department of Water Resources, California’s Most Significant Draughts, released February 2015, compares conditions surrounding these draughts and discusses the ways government is dealing with the current draught. Although the CDWR publication maintains an optimistic tone, the statistics it presents paint a challenging road ahead. A comparison could be made between the search for ways to squeeze water out of dryness and ways to continue finding oil notwithstanding diminishing supplies.
California’s exponential population growth and static development of irrigated acreage are primary conditions affecting the management of draughts. Irrigation acreage is important because at present agriculture is still one of the state’s significant industries, and population growth indicates that residents are allotted a constantly diminishing share of water supplies. These primary conditions are exacerbated by environmental efforts to maintain or restore wild life habitats and an exceedingly convoluted web of “water rights.” The CDWR publication offers more visions of increasingly stringent conservation measures than visions of increased water supplies. In other words, as population grows, your food becomes more expensive and your showers shorter.
Government response to persistent California draughts has been in essence trying to manage what is not there. In spite of the CDWR publication’s positive evaluation of the steps being taken to deal with the draught, it remains difficult to see how some of these steps relate to either producing more water or at least diminishing the impact of a lack of water. For example, $23 billion in bonds approved by voters since 1996 call for reducing flood risk, implementing conservation measures, restoring fish and wildlife habitats, reshuffling water management into regional hands, implementing “multi-objective and multi-beneficiary” projects, and building bike trails. Are these measure solutions of band aids?
Thus San Francisco is not unique in spending significant amounts of money in water band aids, while continuing to ignore the conditions that could develop into a very difficult situation for residents.
Charles Murray, of The Bell Curve and Losing Ground fame, has a new modest proposal, which he discussed during his presentation at the Commonwealth Club on May 18th. The proposal, outlined in Dr. Murray’s latest book By the People: Rebuilding Liberty Without Permission, suggests that ordinary people who are aware of how far this country has moved from the original intentions of its founders start the process of return by creating and using a legal defense "Madison Fund." We pay into this fund like we pay for insurance. When we are annoyed enough with a really useless and detrimental government rule, we break the rule and use the Madison Fund to pay for our legal defense. The idea is to make it costly for government to enforce useless rules, some of which have profound effects on ordinary people’s lives.
Some examples of this type of civil disobedience are the strategies of Uber, Lyft, and AirBnb. The non-aggression principle is followed as no one is being harmed, the public benefits from an efficient service, and the government is left with the difficult task of trying to undo a popular practice that voters are happy with. Murray suggests that everyone who is concerned with government overreach break at least one rule that enjoys a consensus of being useless and detrimental. Rules that stand in the way of our running a business or raising our families as we see fit are good choices.
The impetus of Dr. Murray’s proposal is his concern that the unique “American project,” in which government is limited and the individual is sovereign, is almost gone. Courts and legislators have corrupted the role of the enumerated powers, the commerce clause, and the general welfare, thereby reversing the powers between people and government. The Founding Fathers intended the individual to be sovereign, but today, government sees itself as sovereign. The individual, once the boss, is now the servant. Instead of the very special American project, we now have a maze of bureaucrats regulating every aspect of our lives.
Pinning our hopes on electing a president or legislators who would return the country to its Constitutional roots is not realistic. Special interests wield such power and command such immense amounts of campaign funds that change via the legislative process is unlikely. Liberty is more likely to be rebuilt when action is initiated by the people without permission.
San Francisco Supervisor David Campos has introduced Ordinance #150461 “Zoning-Interim Moratorium on New Residential Uses and Elimination of Production, Distribution, and Repair Uses in a Portion of the Mission Area Plan of the General Plan.” The progressive faction of the Board – Mar, Kim, Avalos and Yee – are co-sponsors. This “Urgency Ordinance” prohibits the issuance of any permits to “demolish, merge, convert, or construct housing projects,” except 100% subsidized projects, “affirming the Planning Department’s determination under the California Environmental Quality Act..”
This is an ordinance worthy of any NIMBY group on Pacific Heights, Telegraph Hill, or The Waterfront, right down to the CEQA card. The difference, of course, is that the high-end NIMBY’s can afford their abodes, and there is no downside to their keeping newcomers out.
The downsides of Campos’ moratorium should be obvious. No building permit is needed to evict a current tenant. Government funding for subsidized housing is not plentiful – that is why Mayor Lee pushed for developer-financed subsidies. Residents of other lower-income neighborhoods would cry foul if more than allotted subsidized units are concentrated in the Mission District. Subsidized housing does not generate high property taxes that can be applied to neighborhood schools. Costs of development currently under construction or in the pipeline will increase as developers continue to experience resistance and delays, and those costs will be passed on to buyers and renters somehow. Prospective developers will demand a higher return on their investment to account for the uncertainties inherent in building in The City, which will be reflected in even higher costs of housing or lower quality of housing.
If the Mission District’s real goal is to stay just as it is, no growth and no change, an iron-clad permanent injunction on all building would possibly work. Other neighborhoods shunning growth could demand the same injunction, say Telegraph Hill. Then the new San Francisco could be just like the old San Francisco we have known for decades. Or, growth could be limited to “transit corridors.” Then we would have a Plan Bay Area scenario – the perfect NIMBY plan.
“In the department of economy, an act, a habit, an institution, a law, gives birth not only to an effect, but to a series of effects. Of these effects, the first only is immediate; it manifests itself simultaneously with its cause - it is seen. The others unfold in succession - they are not seen: it is well for us, if they are foreseen.” 1
The above paragraph, written in 1850, is the introduction to Frederic Bastiat’s dissertation That Which is Seen and That Which is Unseen, a collection of ideas that seem good – the seen – but devolve into unintended consequences – the unseen. Idea number one is “The Broken Window,” a fable about a child who breaks a window in his father’s bakery shop. The baker’s neighbors tell him that his purchase of a new window will put money in the glazier’s hands, the glazier can buy new goods, and the whole neighborhood economy will profit. Bastiat reminds us that the unseen consequence is that the baker, who was planning to purchase a new suit, now does not have money to do so, and the tailor misses out on money with which to buy more goods.
Paul Krugman, Nobel Prize winner and New York Times columnist, would side with the baker’s neighbors. He wrote in his opinion piece of September 14, 2001, “Reckonings After the Horror,” “Ghastly as it may seem to say this, the terror attack -- like the original day of infamy, which brought an end to the Great Depression -- could even do some economic good…Now, all of a sudden, we need some new office buildings. As I've already indicated, the destruction isn't big compared with the economy, but rebuilding will generate at least some increase in business spending.”2 Break some windows, improve the economy. We will see if the rubble left behind by protesters in Baltimore this week will do wonders for the region’s economy.
Some in the press have blamed another broken window theory for the deaths of black men at the hands of police. The Economist article “What Broken Windows Policing Is” says, “In July 2014 an unarmed black man named Eric Garner died at the hands of a police officer after allegedly resisting arrest. Garner’s presumed crime was selling ‘loosies’, or untaxed cigarettes, on a street corner in Staten Island… Some say the problem is ‘broken windows’ policing, an approach to law enforcement based on the theory that cracking down on minor crimes helps to prevent major ones.” 3 Based on broken windows (plural) policing, New York instituted “stop and frisk,” under which mostly black and Hispanic men are stopped and searched without probable cause, creating a great deal of animosity and distrust between neighborhoods of color and police.
The article quoted above goes on to say: “The term ‘broken windows’ refers to an observation made in the early 1980s by [George] Kelling, a criminologist, and James Wilson, a social scientist, that when a building window is broken and left unrepaired, the rest of the windows will soon be broken too.”
The new factories and machines of the late 19th century changed the world forever. Craftsmen became obsolete and farmers left the land to work in cities. Predictably, as cities became crowded with potential workers, conditions in factories deteriorated. Fourteen-hour work days were common, as was child labor. In this environment, workers organized, formed labor unions, and eventually won improved working conditions.
Unions continued to obtain real benefits for workers well into the 20th century. Sally Field’s character in the 1979 movie Norma Rae, when she held the sign UNION, did what thousands of workers must have done since the 19th century.
However, what worked so well in the past, might not be working so well now. National participation in labor unions has decreased steadily. In 1990 16% of employed workers were union members. The percentage in 2014 was 11.1%. Perhaps market conditions changed as deeply in the 21st century as they did in the 19th century, but unions and their supporters have failed to adapt.
Therefore, unions continue to make the same old demands, while businesses avail themselves of new options: outsourcing work to cheaper and less restrictive markets, developing technologies to replace human workers, locating businesses where non-union workers can be hired, or contracting with flexible companies.