The Housing Crisis and the City’s Miracle Workers:
We at LPSF have written and spoken ad infinitum about how San Francisco politicians are committed to performing the miracle of attracting folks with money that will pay high property taxes and astronomical business fees, while keeping the lower-income population in place. This is not an easy feat, since any rational human being would rather rent or sell at market rates to a newly arrived higher-income worker than keep a middle class family in a rent controlled space. It appears that the easiest path to accomplishing this feat is to encourage frequent use of a catchphrase, housing crisis, as if this economic event were the result of evil capitalism that just appeared, unwanted, on the scene, and then follow up with proposals on the November ballot to “strengthen renter protections.” One such proposal will be to encourage state legislators to place restrictions on the Ellis Act, since landlords of unprofitable rent-controlled housing are predictably evicting tenants in order to seek newly emerged opportunities. Perhaps Mayor Lee and the Board of Supervisors are counting on the newly arrived better paid workers to scoop up any formerly rent-controlled buildings abandoned by landlords who find themselves prohibited from making the most out of their investment? Of, course, if that is the case, we must ask how this scenario helps the lower-income families at all.
Income Inequality and Pretending to Fix it
When there is a rapid change in technology – say, automobiles replacing horse-drawn carriages – those who do not adapt to the new realities are left economically behind. The more disincentives there are to adaptation, such as long-term unemployment benefits, “job training” for activities that are one generation behind, and rental controls that render lower-income individuals fearful of moving in search of better economic opportunities, the more income inequality there will be. The progressive solution is to raise the minimum wage, which will affect a relatively small number of workers and will not affect those without a job at all. Mayor Lee and the Board of Supervisors are expected to predictably place such a minimum wage proposal on the November ballot. Their argument is that one can’t live in San Francisco on the current minimum wage. Indeed, one cannot.
Expect our Equally Predictable Response in November
The way we see it, politicians will buy votes in exchange for the illusion of safety. The subject of this post is the illusion of safety from displacement. When economic conditions change structurally and drastically, the only way safety from displacement can be guaranteed is to render individuals who do not adapt to the new conditions dependent on public assistance. Libertarians do not see that situation as real and meaningful safety. We would prefer that City government were honest about the consequences of giving tax and regulatory incentives to picked and chosen industries.
Regionalism is growing like crabgrass. It quietly removes ballot-box control by citizens. It makes it impossible for citizens to correct abuse, greed, or plain stupidity by recalling those in charge. Yet, when we ask folks whether they are aware of growing regionalism, their response is usually either “No” or “What’s regionalism?” These responses are completely understandable, since regionalism is sold to the public as innovative ideas that will benefit us all, while the downsides are not part of the conversation.
In an effort to bring more awareness to regionalism’s downsides, we offer this article, based mostly on the work of Trish Cypher, a Bay Area activist and author of several research publications on government structures:
Background: Regional “governments” – better described as regional “governance” - are created by forming joint powers agreements among jurisdictions such as cities and counties. The concept of joint powers between jurisdictions has existed since the 1920’s, and has produced beneficial results such as fire management, water management, and bridge construction. However, the vast expansion of these powers, especially in California, has produced downsides that should be of concern to all of us.
Downside #1: Once formed, regional governance is immune from voters’ powers of recall, petition, initiative, or referendum. Nothing can be done if voters detect lack of representation, illegal actions, or bad decisions.
Downside #2: Taxation without representation was the battle cry of this Republic. Yet regional governance has the authority to tax without any input from voters or any say at the ballot box. Cities need to go to voters for any increase in financing; regional governance does not. Thanks to incremental financing preset in regional governance, increased tax revenues derived from increased property values are automatically sucked up. Regional governance can sell bonds at will, without voter approval.
Either the designers of the drastic regional upheaval, commonly known as “Plan Bay Area” or “One Bay Area,” thought they could work around the fact that for every action there is an equal and opposite reaction, of they did not connect this physical law with human behavior, as most common-sense folks do.
The Libertarian Party of San Francisco, as well as many other groups, sprang into action, as should have been expected, as soon as Plan Bay Area started to take form. We began disseminating information, attending public meetings, and reaching out to form coalitions. See our articles "Plan Bay Area: Vision or Micromanagement?" and "Plan Bay Area Adopted Under the Cloak of Midnight, Literally!" In the second article, we joined many other groups in sounding the alarm that Plan Bay Area would be a factor in the disappearance of affordable housing, loss of property values in some areas, increased use of eminent domain, and loss of livability and transportation choices.
The second round of reaction came soon after Plan Bay Area was adopted on July 18, 2013, in the form of lawsuits from the right and the left, aimed at the Association of Bay Area Governments (ABAG) and the Metropolitan Transportation Commission (MTC), the architects of Plan Bay Area. Here is a list of current lawsuits, all of which could use the public’s moral and financial support.
Community Coffee with State Senator Mark Leno
Mark Leno is a popular figure in California, mostly because he makes an effort to connect with his constituents. One such effort is his Community Coffee, where he explains legislation he has introduced and takes questions from attendees. We attended the Community Coffee of October 19, 2013, at the Greenhouse Coffee House. The audience was friendly, and those who asked questions and spoke out were generally supportive of Senator Leno.
This gathering left us amazed as always at the automatic solution proposed by our legislators to every economic and social challenge: tax, spend, and pass another law. Many laws that are passed create more challenges, for which more spending is proposed, and more taxes must be levied. Meanwhile, an ever-growing number of taxpayers, at increasingly wider income levels, adjust to the idea that tax, spend, and create another law constitutes the only solution to anything that comes up.
At their meeting of “July 18”, after several hours of listening to public comments, the joint Executive Boards of ABAG/MTC started the voting to determine adoption of Plan Bay Area -- at around 12:15 am. Although some public comments at this meeting were positive, most used terms that ranged from “unconstitutional” to “abomination.” However, the Plan was adopted, as expected.
At least one member of the public who offered a comment indicated that lawsuits were being filed against Plan Bay Area. The Post Sustainability Institute/Democrats Against UN Agenda 21 and Freedom Advocates are launching a legal challenge to Plan Bay Area, pointing to several violations of the Plan, such as those against the 5th Amendment of the US Constitution (taking of private property without just compensation), the 14th Amendment of the US Constitution (equal protection clause), the voter-approved Urban Growth Boundary ordinances (plans encouraging growth in the periphery of cities), etc. Visit the Post Sustainability Institute website for details of the lawsuit, and to pitch in to help fund the lawsuit should you agree with its premise; see link below.
Although the vote to adopt Plan Bay Area sailed through, some Commissioners expressed concern about funding for the two key features of the Plan, housing and transportation. Those concerns are well warranted! The 28-year horizon and the projected revenues of the Plan are both on the ambitious side.