There is a lot wrong with this rant about San Francisco

by on April 26, 2016 at 12:53 am in Current Affairs, Economics, Law | Permalink

Nonetheless it is worth reading.  From Tim Redmond, here is one bit:

…let’s remember: San Francisco is already by far the densest city West of the Mississippi, and third in the entire country…

And another:

Seriously: If you take the city’s own studies, which show that every 100 units of market-rate housing create a demand for 30 units of low-income housing (because new rich residents want people to serve them coffee and fine wines and clean their clothes and their toilets and provide security etc., and those new jobs mean new people who need places to live), then any high-end housing that isn’t 30 percent affordable is making the crisis worse. Got that? When you are in a hole, stop digging. If you’re in a crisis, don’t make it worse. And right now, building luxury housing is a net loser for the city.

The same goes for Muni. It costs the city far more to serve new housing than the new housing pays. Which means every time the rest of us pay higher fares for Muni, we are in effect subsidizing market-rate housing developers.

And yet another:

Please: Show me any evidence, any credible evidence at all, that allowing the private market to build, baby, build in San Francisco today (without demolishing hundreds of thousands of rent-controlled units and creating a city like Manhattan or Hong Kong without the social housing, that none of us want to live in) will actually bring down rents and allow the middle class to stay, and I will listen. But as far as I can tell, that evidence doesn’t exist.

In contrast I would stress that we need to count the welfare of the in-migrants.  But I nonetheless hope that market urbanism can do a better job outlining how cheaper housing might be expected to come to San Francisco, and with which complementary regulations if any.

On the limits of restrictive housing policy in San Francisco, this NYT story is also worth reading:

The Chamber of Commerce and the tourist board are calling for harsher measures to improve what is euphemistically called the “condition of the streets,” a term that encompasses the intractable homeless problem, public intravenous drug use, the large population of mentally ill people on the streets and aggressive panhandling. The chamber recently released the results of an opinion poll that showed that homelessness and “street behavior” were the primary concerns of residents here.

It’s funny but also sad how many people attacked me when I predicted this in my book Average is Over:

Visitors come to bask in the Mediterranean climate, stroll through the charming streets and marvel at the sweeping views of the bay and the Pacific. But alongside those views are tent encampments on sidewalks and rag-covered homeless people in front of some of the most expensive real estate in America.

Property crime is up more than sixty percent since 2010.

I say they eventually get cleared out, but to where?  Here is my previous post on market urbanism and whether it is overrated.

1 mkt42 April 26, 2016 at 1:16 am

Yes, plenty wrong.

I’m dubious about when people cite statistics about how densely populated the western US cities allegedly are; I remember a column by an economist who claimed that Los Angeles is more dense than New York City and most other northeastern cities. I’d like to see what calculations they are doing, and what areas they are covering.

This SF BARF group must have some PR expert who’s giving them good advice; they also got covered in the Portland Oregonian a week or two ago.
http://www.oregonlive.com/front-porch/index.ssf/2016/04/yes_in_my_back_yard_a_housing.html

2 Steve Sailer April 26, 2016 at 2:19 am

Parts of Los Angeles have very high density of people per room, but usually not a high density of rooms per acre.

3 Horhe April 26, 2016 at 1:10 pm

Ha, I liked that. +1

4 AIG April 26, 2016 at 2:27 am

NYC metro area is about 3.5 times denser than the LA metro area.

5 Jonah April 26, 2016 at 11:04 am
6 AIG April 26, 2016 at 1:11 pm

Typical MR commenter: “Wrong! Here’s a chart that deals with a different question from the one you’re answering to show why you’re wrong!”

7 Ricardo April 26, 2016 at 7:47 am

It comes down to which unit of geography you are doing the density calculation for. Since San Francisco is both a county and city, it is pretty easy to check that it is the most densely populated county aside from four of the five counties that make up New York City. If you look at incorporated cities by population density and then exclude those cities with less than 500,000 people (since most of these are quite small and are obviously part of bigger metro areas), San Francisco is second only to New York in terms of population density. It is more densely populated than Chicago, Philadelphia, Boston, D.C., etc.

It is only when you switch to looking at greater metropolitan area as defined by the U.S. Census that L.A. beats S.F. presumably because the L.A. area sprawls out with a certain consistent density while the Bay Area has an extremely dense urban core but also some relatively sparsely populated areas mixed in with more typical suburban sprawl. You can check any of these tables on Wikipedia or the Census website.

8 brad April 26, 2016 at 10:10 am

San Francisco is unusually small — just a little bigger than the Bronx.Los Angeles on the other hand is unusually large — 1.5x the size of NYC which itself is a large city.

City limits in general are a pretty worthless measure for this sort of thing because they are arbitrary historical accidents. Better to use population weighted density.

9 Nick April 26, 2016 at 1:16 pm

For what it’s worth, I see the New York-Newark, NY-NJ-CT Urbanized Area as having a density of 5,318.90 per square mile (18,351,295 people over 3,450.202 square miles) & Los Angeles-Long Beach-Anaheim, CA Urbanized Area as having 6,999.35 people per square mile (12,150,996 people over 1,736.018 square miles).

Reference maps for the Urbanized Areas is at http://www.census.gov/geo/maps-data/maps/2010ua.html

I took the data from the Gazetteer file for Urban Areas at http://www.census.gov/geo/maps-data/data/gazetteer2010.html , downloaded to a text file, & copied to excel. Then created a formula to figure the density.

Sorting it out, the most densely populated is Richgrove, CA Urban Cluster at 10,024.48 (2,867 over 0.286 square miles). The most densely populated ones with over 50,000 people are 1) LA 2)San Fran-Oakland 3) San Jose 4) Delano, CA 5) NYC 6) Davis, CA 7) Lompoc, CA 8) Honolulu 9) Woodland, CA 10) Las Vegas-Henderson

The least densely populated is Centre, AL 3,707 people over 10.201 sq mi & the least densely populated over 50,000 is Hickory, NC 212,195 people over 261.611 sq mi

Definitions:

Urban Clusters (UCs)—An urban cluster consists of densely developed territory that has at least 2,500 people but fewer than 50,000 people. The Census Bureau first introduced the UC concept for Census 2000 to provide a more consistent and accurate measure of urban population, housing, and territory throughout the United States, Puerto Rico, and the Island Areas.

Urbanized Areas (UAs)—An urbanized area consists of densely developed territory that contains 50,000 or more people. The Census Bureau delineates UAs to provide a better separation of urban and rural territory, population, and housing in the vicinity of large places.

10 prior_test2 April 26, 2016 at 1:37 am

‘Visitors come to bask in the Mediterranean climate’

Maybe you were mocked for comparing San Francisco’s weather to that of Sicily, or using the term ‘bask’ in regards to San Francisco (or at least parts of it, as the city has a lot of local weather variation)?

‘Sicily has a typical Mediterranean climate with mild and wet winters and hot, dry summers. On almost any average day, temperatures in Sicily may rise up to 44 °C (111 °F).’ – https://en.wikipedia.org/wiki/Sicily#Climate

‘Temperatures reach or exceed 80 °F (27 °C) on an average of only 21 and 23 days a year at downtown and San Francisco International Airport (SFO), respectively.’ – https://en.wikipedia.org/wiki/San_Francisco#Climate

In all fairness, San Francisco is considered to have a Mediterranean climate, but then, it is likely that San Francisco also has places that proclaim they serve world famous cheesecake or world famous sourdough, or some such other equally mockable claim.

11 dan1111 April 26, 2016 at 2:59 am

“Mediterranean climate” is a meteorological term describing regions that have a climate similar to the Mediterranean. San Francisco has such a climate. Of course it is not as warm as Sicily, but there is a lot of variation within the Mediterranean basin. https://en.wikipedia.org/wiki/Mediterranean_climate

12 Steve Sailer April 26, 2016 at 6:56 am

Northern California enjoys a Mediterranean climate one or two valleys inland from the cold Pacific: Silicon Valley, Napa Valley, etc. A few expensive neighborhoods in San Francisco might be alleged to enjoy Mediterranean microclimates, but most of the city (e.g., the Sunset district near the Pacific) has dank summers. (Autumns in San Francisco are very nice, though.)

Southern California enjoys a Mediterranean climate from the cool Pacific to the first mountain range.

13 dearieme April 26, 2016 at 7:08 am

“On almost any average day, temperatures in Sicily may rise up to 44 °C (111 °F): what tosh. Utter bloody tosh.

14 JWatts April 26, 2016 at 8:30 pm

Yes, prior_test pulled it from wikipedia without double checking it and it seems completely ridiculous.

http://www.holiday-weather.com/sicily/averages/

15 Keith April 26, 2016 at 7:23 am

Steve, actually the two neighborhoods with the best weather are the poorest: Bayview and hunter’s point. They are the poorest due to their proximity to the old shipyard that attracted many blue collar workers until the 1970’s when it closed. These neighborhoods are now rapidly gentrifying.

I would characterize San Francisco weather as always slightly uncomfortable but never really bad.

16 Brian Donohue April 26, 2016 at 1:03 pm

I find dressing for the weather in San Francisco to be tricky.

17 JayT April 26, 2016 at 5:03 pm

Half the reason I live in the SF Bay Area is because the weather is almost always beautiful. Rarely cold, almost never hot. Just constantly in that perfect 50-70 degree range.

18 MOFO April 26, 2016 at 9:31 am

Really? thats your complaint? That the adjective TC used to describe the nice weather in SF isnt totally accurate?

Here is the adjectives i use to describe you:

Pedantic blowhard.

19 msgkings April 26, 2016 at 12:11 pm

Only one of those is an adjective. 🙂

20 Ian April 26, 2016 at 2:08 pm

Except it is accurate pedantically.

21 MOFO April 26, 2016 at 2:53 pm

Accurate does not equal relevant.

22 Jimmy April 26, 2016 at 10:06 am

Read before commenting. That’s the NYT’s sparkling prose, not Cowen’s.

23 El Gringo April 26, 2016 at 1:44 am

“If you take the city’s own studies, which show that every 100 units of market-rate housing create a demand for 30 units of low-income housing (because new rich residents want people to serve them coffee and fine wines and clean their clothes and their toilets and provide security etc., and those new jobs mean new people who need places to live)”

I understand how one might view “affordable housing” supporting these kinds of tenants, but I would like to see data on that. My anecdotal experience is that this is not who takes advantage of “affordable housing” in reality. I live in an SF building with section 8 and most of those taking advantage of it are senior citizens who barely speak English (usually Russian or Chinese.)

This is insult upon insult upon injury: people who shouldn’t be here (don’t immigrate if you can’t support yourself) are paying their discounted rent with my tax dollars (ie. Social Security transfer payments) and reducing housing supply (in turn driving up my rent.)

24 Jan April 26, 2016 at 5:43 am

These new, elderly, non-English speaking immigrants qualify for Social Security?

25 Milo Minderbinder April 26, 2016 at 8:54 am

Yes, their kids bring them over and once they are naturalized they can collect SSI.

26 D April 26, 2016 at 10:46 am

As someone who once worked for SSI/SSDI (permanent disability), you would be shocked at how many non-English speaking people apply and get SSI/SSDI. In fact the inability to do any of the following well – speak, read, write, or understand English – is considered a factor in your favor to get put on SSI/SSDI.

I once went through my entire caseload and found that about 35% of my cases had Hispanic surnames and of those, 65% alleged they couldn’t do one of those factors above.

27 Ricardo April 26, 2016 at 10:59 am

Yes, SSI, not retirement benefits. To be clear on what this means, the maximum SSI benefit for a couple is $1,100 per month and is reduced based on income, free housing received from relatives, etc.

28 MC April 26, 2016 at 10:57 pm

Sec. 8 obviates the need for living for free with relatives, and any other help from relatives is not likely to be reported. They also receive medical benefits. So it is hardly a nontrivial subsidy to people who pay nothing into the system.

29 Dan in philly April 26, 2016 at 1:46 am

“creating a city like Manhattan or Hong Kong without the social housing, that none of us want to live in”
This reminds me of the Yogi Bera line “Nobody goes there anymore, it’s too crowded.”
Maybe the city is going to become something none of the people who are reading this article want to live in, but quite obviously someone wants to live there. Are we going to ignore the rights of those potential future residents so the present ones can enjoy their lifestyles for a bit longer?

30 dan1111 April 26, 2016 at 2:45 am

“Are we going to ignore the rights of those potential future residents so the present ones can enjoy their lifestyles for a bit longer?”

Well, duh: yes!

31 BC April 26, 2016 at 6:58 am

I’m guessing that taxi drivers also don’t “want to live in” a place that is cluttered up with a bunch of Uber cars. What is the difference between owning a taxi medallion, through which supply is kept artificially low by regulation, and owning San Francisco housing, supply of which is also kept artificially low by regulation? One can think of each housing deed as having a “medallion” embedded in it. Without a housing medallion, one can’t build a new housing unit. The main difference seems to be that taxi drivers are not sophisticated enough to wrap their privilege seeking in the language of sustainability, preservation, affordability (ironically), etc.

32 Horhe April 26, 2016 at 1:15 pm

“Are we going to ignore the rights of those potential future residents so the present ones can enjoy their lifestyles for a bit longer?”

The immigration/refugee debacle in a nutshell.

33 Mr. Econotarian April 26, 2016 at 1:50 am

San Francisco (proper) population density is 17,000 people per square mile (PPM), New York’s is 27,000 PPM.

Some cities in the New York metro area (such as Union City or Guttenberg) are > 50,000 PPM.

I agree with Tim that San Francisco is very dense for west of the Mississippi, but it should look more like New York (or Hong Kong) than Santa Cruz.

34 dan1111 April 26, 2016 at 2:46 am

Obviously, cities west of the Mississippi inherently can’t be as dense. Which is why “West of the Mississippi” is the right area for comparison and not arbitrarily picked to prove a point.

35 MOFO April 26, 2016 at 9:36 am

Obviously? Not obvious to me.

36 John Thacker April 26, 2016 at 1:08 pm

Sarcasm from dan1111, I believe.

37 anon April 26, 2016 at 9:46 am

Earthquakes do matter though, and the lack of fortuitous bedrock.

38 John Thacker April 26, 2016 at 1:09 pm

Which is why Tokyo is a good comparison. Tokyo is far more dense and builds far more housing.

39 Adam April 26, 2016 at 11:57 am

It’s geographically constrained, so, yeah it should look like other major cities that are also geographically constrained.

40 Lord Action April 26, 2016 at 1:06 pm

Uhh, like New York and Hong Kong, maybe?

41 Lord Action April 26, 2016 at 1:18 pm

Sorry, I think I misread you and you were agreeing with Mr. E.

42 El Gringo April 26, 2016 at 1:52 am

Not shocked by the crime rate. I almost never see anything from the SFPD that resembles enforcement.

I live in one of the higher crime areas of central SF where drinking and drugs on the street is a daily occurence, even in daylight, yet I rarely see police.

In the last year I can remember one instance of the police addressing an incident in my neighborhood. They were handcuffing someone who was obviously mentally ill.

43 bob April 26, 2016 at 10:31 am

15 years ago prior to all the legalization I used to buy pot from guys in front of the police station. They were literally leaning against the station wall.

44 El Gringo April 26, 2016 at 2:15 pm

They are still there. Crack and smack too if you want it.

45 stephan April 26, 2016 at 2:12 am

let’s say we just let the market in SF do its work:
1-only market rate housing is built
2- minimal regulations and nearly unrestricted zoning: i.e. build what you want to build where you want to build it ( no Nimby influences)
3- eliminate all rent control or rent subsidies
What would the city look like ( Manhattan perhaps ?) and would it be a bad thing. ?

46 AIG April 26, 2016 at 2:21 am

Nothing would change.

The “city” of SF is meaningless and irrelevant. There’s a whole metro area there. People don’t have to live in SF. They can live anywhere in the rest of the 98% of the surface of the metro area not covered by the city of SF.

The limiting factor in SF is…geography…and the unwillingness/inability of the government (in that case it would be the state government) to build road infrastructure.

That’s why 90% of the people in the metro area don’t live in SF, but in San Jose, Oakland, Berkeley etc.

47 msgkings April 26, 2016 at 2:43 am

This has truthiness. SF is pretty small relative to it’s metro area, both in area and population, more than is typical for the ‘main’ city in the metro. It’s almost like the rich dense neighborhood in a big sprawling city (the metro area)

48 anon April 26, 2016 at 9:49 am

Someone spent north of $6B for a new Bay Bridge.

49 Brian April 27, 2016 at 5:31 am

Half of a new Bay Bridge.

50 AIG April 26, 2016 at 2:16 am

I don’t think the author (or some commenters here) understand the concept of a metro area. A “city” is a meaningless term.

The “city” of SF is a mere 46 square miles of a 3,500 square mile…metro area.

Why does the author, or anyone, think that the unwashed masses of servants ought to live…necessarily…in that 46 square miles of real estate, instead of across the river in Oakland or some other God foresaken rat hole a bit further away?

SF only has 10% of the population of the…SF METRO area.

Do people not understand how…space…works? You don’t have to live where you work. You can live, you know, 5 miles away. Or God forbid, 10 miles away.

We invented this thing called the car. Around 1890, I believe. It’s cutting edge stuff.

Of course, that’s what you get when you decide to build a city on a pile of rocks in the tip of a peninsula. Good idea in 1840 when your main means of transport was a boat. Not so great in the 21st century.

51 simeon April 26, 2016 at 10:40 am

We invented the car, but when it’s extremely expensive to find space for productive uses like housing and offices, parking isn’t exactly cheap either.

52 Adam April 26, 2016 at 11:59 am

Nor is driving.

53 AIG April 26, 2016 at 1:13 pm

So live somewhere else

54 John Thacker April 26, 2016 at 12:35 pm

There’s a decent argument that the fragmented cities in the SF area contribute to the lack of housing, since each has their own zoning and housing policy, and all of them prefer that the affordable housing be build elsewhere.

SF can fairly say that the city itself is not the only problem.

55 AIG April 26, 2016 at 1:13 pm

“Affordable housing” is code word for…ghetto?

56 GeoffBr April 26, 2016 at 3:08 pm

I’m not sure the fragmentation itself is the cause, but there is definitely a broader Bay Area problem (and arguably a much bigger problem outside the city itself). A decent home in the Peninsula is slightly larger than its SF counterpart, but just as – if not more – expensive. And there are far, far fewer high rises in, say, San Mateo than there are in the city even though many people would be perfectly content to live there instead.

Ultimately, I’m not sure how this gets solved. People in the Bay Area will always protect themselves politically against those who aren’t there yet.

57 Daniel Weber April 26, 2016 at 1:08 pm

Why are we doing a Rube Goldberg mechanism of central planning? When you create 100 units of market-rate housing, it’s not like 30 units full of low-income people are marched in at gunpoint to take the resulting jobs. If the wage/rent ratio is too high, they won’t take the jobs, and so wages will be forced to go up.

58 AIG April 26, 2016 at 1:17 pm

You’d think it wouldn’t be so hard, would you?

If people can’t afford to live there, they won’t live there, driving up wages for service people, allowing them to live there again.

Its almost…as if…there was some invisible force behind it all….that is beyond Bernie Sander’s tiny brain’s comprehension.

Almost.

PS: Of course, the real issue here that no one wants to talk about is that…the issue isn’t service sector jobs. It’s about ghettos and ghetto dwellers.

59 Steve Sailer April 26, 2016 at 2:46 am

“across the river in Oakland”

It’s not a river.

It’s good have some fraction of your trained emergency responders living in San Francisco itself when the Big One hits because it may be days or weeks before the bridges are usable.

60 AIG April 26, 2016 at 3:41 am

Pretty sure the “emergency responders” in SF are paid 6 figure salaries.

If earthquakes is what you’re planning for, don’t like in SF. There’s plenty of flat land around the US.

River shmiver.

61 Jan April 26, 2016 at 7:05 am

Great, so they’re three zeros short of being able to buy a house in San Francisco.

62 Alain April 26, 2016 at 10:36 am

Your innumeracy is like candy to me.

63 AIG April 26, 2016 at 1:17 pm

Soooo…..don’t live in SF.

Why is this such a hard concept for you to figure out?

64 Ricardo April 26, 2016 at 8:06 am

“If earthquakes is what you’re planning for, don’t like in SF.”

This sentence makes no sense. Of course, anyone can choose to live in SF or not but it is a scientific fact that major earthquakes happen there every 100-150 years. Those who choose to live there pay for emergency services that are indeed supposed to be prepared to put out fires and pull people out of rubble when the next earthquake hits.

65 anon April 26, 2016 at 9:51 am

Lots of hidden costs in building (and bringing up to code) though, which may impact this discussion.

66 AIG April 26, 2016 at 1:19 pm

Its your sentence that makes no sense.

If they are willing to pay for it, then where’s the problem? You realize one doesn’t actually have to LIVE in the area they work in…right?

You realize SF is not an island? Right?

67 JVM April 26, 2016 at 3:12 am

> But I nonetheless hope that market urbanism can do a better job outlining how cheaper housing might be expected to come to San Francisco, and with which complementary regulations if any.

Is Tyler arguing that increased supply will not result in a reduced relative-to-baseline price? Even holding market prices steady would be an accomplishment and surely be welfare maximizing. I know some tech workers who recently had to leave their non-rent-control 1-bedroom apartment after a rent increase from $3500 to $4500. Now they’re in Oakland displacing residents there. If you added a million units and rents stayed the same, at least those million residents aren’t causing trouble elsewhere!

68 chuck martel April 26, 2016 at 6:01 am

“Now they’re in Oakland displacing residents there.”
No matter where someone lives, it could be said that they’re “displacing” someone else.

69 prior_test2 April 26, 2016 at 6:15 am

‘No matter where someone lives, it could be said that they’re “displacing” someone else.’

With exceptions, such as broad suburban development in the U.S., where most of the living space gained involved changing farm/wood/grass/wet land to subdivisions. Obviously, the suburbs created broad changes, and a farmer that sells 250 acres to enable the creation of 1000 houses is ‘displaced’ as a farmer, by one perspective. But to be more specific, in NoVa, the devastation of the Civil War, plus the unattractiveness of played out farmland compared to better soil further west, resulted in basically large amounts of truly depopulated land, where forests regrew undisturbed for a century. Lots of things to lay at Til Hazel’s feet, but to call his brand of suburban development requiring ‘displacement’ is stretching the point too far.

70 prognostication April 26, 2016 at 11:31 am

I’m sympathetic to anti-gentrification perspectives, but I’ll also point to the famous Freeman and Braconi JAPA study from awhile back that found that most gentrification (in certain NYC neighborhoods, over a certain period of time) occurred via turnover rather than direct displacement — i.e. wealthier whiter people taking over properties from people who would have moved anyway. I suspect this is not atypical.

71 Steve Sailer April 26, 2016 at 3:13 am

Voters in San Francisco, which went 84-13 for Obama over Romney, have been effective at providing breaks for people currently living in San Francisco at the expense of people not currently living in San Francisco, but they are largely aghast at ordinary Americans wanting something similar relative to non-Americans. That’s xenophobic racist nativism! In contrast, keeping people out of San Francisco is environmentalist egalitarianism. Or something.

72 Tokarev April 26, 2016 at 4:38 am

Well you say that, but… when I visited San Francisco the city was packed with “undesirables”, especially crazy homeless people and aggressive panhandlers. So the extent to which they are effectively keeping out riffraff using environmentalism seems… questionable.

73 Josh April 26, 2016 at 5:52 am

The homeless drug addicts keep out the undesirables, married people with children. Yech.

74 Jan April 26, 2016 at 7:07 am

Cities that are low on married people with kids are the most fun ones. As AIG points out, those people can go live in San Jose or Daly City or something.

75 A Definite Beta Guy April 26, 2016 at 8:23 am

Fun for who? The most magical place on Earth is Disneyland, not San Francisco.

76 Lord Action April 26, 2016 at 10:03 am

Josh nailed it. Jan’s enthusiastic agreement is comical.

All that said, I’m not sure I begrudge the people living there having a plan. They own the place, after all.

77 n April 27, 2016 at 9:17 pm

Yes, occupancy confers some privileges. For example, only current San Francisco residents are allowed to vote in San Francisco elections. That’s how it works other places too, right?

78 Don Wallace April 26, 2016 at 3:53 am

You’ll find the exact same conditions and outcome in Honolulu, which has the highest per capita homelessness in the US, as well as a scary, escalating housing market that also is stalled in terms of affordable housing. I have an article in the May HONOLULU Magazine (not yet online, will link when it hits) about the absurd gyrations politicians make trying to call 1 million dollar condos a solution.

The irony in Honolulu, unlike SF or NYC, is that the $1 mil condos aren’t selling either–the Chinese haven’t come into Honolulu as predicted. So there is a glut of unsold expensive stuff while a thousand homeless sleep, camp, fight, etc at their feet. And unlike SF or NYC, there is no icy wind of winter to encourage them to disappear for awhile. Nor is there anywhere to go, anyway, given that Hawaii is 2,500 miles from the next big city.

79 Steve Sailer April 26, 2016 at 4:05 am

Are mainland cities still buying their homeless one-way tickets to Honolulu?

80 Don C Wallace April 26, 2016 at 4:15 am

The government homeless officials say there is no proof this ever happened, it’s all an urban myth.

However, there is a fund to send homeless back on a one-way ticket. Makes you wonder?

A significant new population comes from Micronesia under the COFA, compact of free association, signed or imposed on Hawaii by the government as compensation for nuclear tests that destroyed many atolls and sickened the population. The Micronesians are entitled to free health care, but the US neglected to fund it–leaving it to the state to eat the 100 million plus cost.

81 Viking April 26, 2016 at 10:47 am

My ancestors in the old country did buy their public charges one way tickets to America, but we were more progressive, so progressive that we wanted to balance the budget long term. And I bet it was a win-win.

82 dearieme April 26, 2016 at 7:15 am

“the Chinese haven’t come into Honolulu as predicted”: perhaps they foresee a second Pearl Harbour eventually, but more thorough. Hawaii would make a pleasant retirement spot for the ruling class of the PRC.

83 brad April 26, 2016 at 12:39 pm

I never understood why people would move all the way to Hawaii and then settle in the shithole that is Honolulu. If you are going to pay the costs of being in a remote natural paradise you might as well enjoy the remote natural paradise part.

84 Steve Sailer April 26, 2016 at 4:05 am

Is gambling still illegal in Hawaii? It’s hard to attract Chinese without gambling.

85 Don C Wallace April 26, 2016 at 4:11 am

You’re right, it’s still illegal, except for bingo on the military bases (which actually was raided a couple of years ago–it was getting out of hand).

The tension there is between a highly religious Christian population (Mormon, Christian) and the itchy gambling population (which has illegal establishments, which could never handle a flood of offshore Chinese). The late Senator Inouye always opposed gambling, yet was viewed as setting up its establishment ultimately by a Native Hawaiian homeland, a la Native Americans. But the kanaka maoli have not got the same sovereign status as NAs since no treaties were ever signed with US about the loss of the Islands. The five-year gap between US-sponsored coup and the annexation laundered the exchange, apparently in the eyes of lower courts.

Gambling is raised each legislative session and always dies in committee.But it is only a matter of time, many think.

86 rayward April 26, 2016 at 6:35 am

Everybody’s furious, and not just in Pennsylvania. http://www.nytimes.com/2016/04/26/opinion/campaign-stops/pennsylvania-where-everyone-is-furious.html?ref=opinion That rich people need poor people around to serve them reminds me of an ant colony. Hey, we are all in this together, right. In my low country community, the owners of the very expensive nearby resort solved the labor problem by bringing in ants, I mean young people, from South America and Eastern Europe and housing them in the large inn the owners purchased for that purpose. Besides the shuttle between the inn and the resort, the owners provide the young people with a large fleet of bicycles. It’s an interesting arrangement. And it adds an international flavor to the place. Young women from Eastern Europe and South America, well, you get the idea. For the young people it’s an adventure, as they don’t stay permanently (I assume as long as their visas allow), so there’s regular turnover and new, enthusiastic young people to serve the rich people who are visiting or reside at the resort. Oh, and the owners of the resort solved the problem of local poor people committing crimes at the resort: they put up a gate and fence and posted guards to keep them out.

87 Jan April 26, 2016 at 7:10 am

I’ve noticed this in a lot of places the past few years. I would have assumed it’s a huge pain for the employers, administratively, but I guess it works out.

88 rayward April 26, 2016 at 7:49 am

The point is that rich people can solve rich peoples’ problems because they have what it takes: money. Of course, things like inadequate or non-existent public transit aren’t rich peoples’ problems (rich people don’t use public transit) so they aren’t going to solve them. And rich people are rich partly because they don’t spend their money solving their problems if somebody else will spend somebody else’s money to solve rich peoples’ problems for them. Thus, things like public subsidized housing for poor people who work for rich people. Solving rich peoples’ crime problem is not so easy, as rich people need poor people around to serve rich people but poor people sometimes commit crimes against rich people. When I was a child growing up in the South, the problem of poor people committing crimes against rich people after dark was mostly solved by criminalizing the presence of poor people (i.e., African Americans) in areas where rich people (i.e., white people) lived after dark. Yes, walking down the street while black was a crime when I was a child. At least it was after dark. And even in some cases before dark: Willie, who worked for my family, was arrested more than once for passing on a hill. While walking. As compared to the solution crafted by the owners of the expensive low country resort, the solution when I was a child wasn’t very creative but it mostly worked. It worked for rich people, anyway. And like I said, rich people have what it takes to solve rich peoples’ problems: money.

89 stephan April 26, 2016 at 9:57 am

Sounds like rich people are the problem and we should make everyone poor for a better society

90 JWatts April 26, 2016 at 8:37 pm

Venezuela is rapidly approaching utopia.

91 rayward April 26, 2016 at 10:31 am

Rich people are rich in part because they are smart and know how to solve problems; and, once they become rich, have what it takes: money. That’s a compliment to rich people. There ought to be more of them, not fewer. Government historically has responded to the needs of rich people because, well, they are rich. A problem arose for rich people when poor people got the idea that government should respond to the needs of poor people. Poor people, they just don’t understand that it’s not meant to work that way. Thus, rich people have been working hard to take back government. And being rich, they have mostly succeeded (although the work of rich people is never done). If rich people in San Francisco need poor people around to serve them, then rich people will figure out how to do it. What rich people would prefer is for somebody else to pay for it; and being rich, they are likely to get their way.

92 Ed April 26, 2016 at 10:55 am

What the rich people really want are good robots. All the best attributes of poor people and almost none of the downsides. Who makes a more appealing cab driver, a poor immigrant with marginal English, or Google’s most recent self-driving AI? The robots will be here soon.

93 El Gringo April 26, 2016 at 9:25 am

Doing jobs Americans won’t do.

94 WC Varones April 26, 2016 at 8:36 am

See also Costa Mesa, a middle-class town next to ritzy Newport in Orange County:

http://www.latimes.com/local/orangecounty/la-me-0423-costa-mesa-affordable-20160423-story.html

95 anon April 26, 2016 at 10:01 am

Costa Mesa has always been as close to no zoning as Orange County gets. A friend divided her house into two rental units. Costa Mesa doesn’t care. They build condos on a commercial-industrial street, etc. They crack down on sober living and pot dispensaries but that’s about it.

– from barely across the border in NB

96 Will Minshew April 26, 2016 at 9:31 am

In response, Houston is the perfect case study for how less zoning and land regulation leads to affordable housing: http://econlog.econlib.org/archives/2016/04/market_urbanism.html

97 Horhe April 26, 2016 at 1:25 pm
98 Alex Armlovich April 26, 2016 at 10:19 am

If the city wants to capture the windfall to cover the transportation and other infrastructure renewal that’s necessary, they can sell the air rights instead of giving them away. Transferable development rights in the upper east side of Manhattan sell for $400/sf, I’m sure in San Fran it’s in that ballpark. Why not zone by price instead of giving away quantity-limited quotas. The economic equivalent is to sell cap-and-trade credits, instead of just allocating them for free. Why not capture the scarcity rents?

Manhattan’s Hudson Yards rail-decking project has a TIF and a tranche of bonus air rights that sell for $100/sf to pay off the bonds issued to fund the 7 train extension and other infrastructure improvements to the district. NYC also just passed an inclusionary housing bill that trades new air rights in upcoming rezonings in exchange for 30% income-restricted housing. It’s not hard, people! Learn from existing value capture models–and then build build build.
http://www.hydc.org/html/project/rezoning.shtml

99 Alex Armlovich April 26, 2016 at 10:25 am
100 Jake April 26, 2016 at 10:28 am

“If you take the city’s own studies, which show that every 100 units of market-rate housing create a demand for 30 units of low-income housing (because new rich residents want people to serve them coffee and fine wines and clean their clothes and their toilets and provide security etc., and those new jobs mean new people who need places to live)”

This argument makes no sense to me. If rich people want lattes but housing is too expensive for low wage workers to live in SF, then coffee shops will face a labor shortage, raise prices and salaries, and then rich people can either make their own coffee or pay more. This isn’t some kind of mysterious new problem, coffee costs more in expensive areas already for exactly this reason (and other reasons too, or course).

There is no argument against increasing supply for an in-demand good unless you want to protect stakeholders who already have the good. Tyler is obviously a very smart guy, but I honestly don’t get how he convinces himself of this anti-market urbanism stuff which seems like demand curve trutherism. In his last post he suggested that building more housing supply in popular cities would increase demand and maintain price levels and is therefore not worth building. Putting aside that new people moving to the city are clearly being served by this new housing supply or it would not be filled and their preferences are as valuable as anyone else’s, the fact remains that more housing supply would not increase demand *infinitely* and there therefore will come a point where housing prices fall once demand is met. Not everyone on earth can or wants to move to San Francisco and New York City. If we want to make these cities more livable we can either start means testing admittance to the city limits or build more housing. Sorry your historic district might suffer in the process?

101 El Gringo April 26, 2016 at 2:18 pm

Your argument makes sense… except that supply and demand curves don’t matter anymore (see “Monetary Policy”, “Minimum Wage Acts”, and pretty much any new policy from “Economic Experts” nowadays)

102 Can May 1, 2016 at 7:19 pm

I’ve been reading about this debate for a long time and this is one of the most insightful comments I’ve read so far.

103 Scott Mauldin April 26, 2016 at 11:53 am

If 100 units of market-rate housing require 30 units of low-income housing, that’s not 30/100 or 30%, but 30/130, or 23%.

104 Robert April 26, 2016 at 12:05 pm

Math was made by the patriarchy to oppress women. Stop oppressing people.

105 Adam April 26, 2016 at 11:54 am

And again, cheaper than what? The demand isn’t going to go away. Either you build new supply to serve it or you watch prices rise even faster.

106 Robert April 26, 2016 at 12:03 pm

> “If you take the city’s own studies, which show that every 100 units of market-rate housing create a demand for 30 units of low-income housing (because new rich residents want people to serve them coffee and fine wines and clean their clothes and their toilets and provide security etc., and those new jobs mean new people who need places to live)”

He’s right! We need to have robots clean our toilets and serve us coffee and let people with no skills simply starve to death.

107 Hazel Meade April 26, 2016 at 5:06 pm

Alternatively, if we want poor people to have places to live, we need to make sure there are no jobs attracting people to come live in the area.

108 John Thacker April 26, 2016 at 12:33 pm

The same goes for Muni. It costs the city far more to serve new housing than the new housing pays. Which means every time the rest of us pay higher fares for Muni, we are in effect subsidizing market-rate housing developers.

It costs cities in California more to serve new housing than the new housing pays largely because of the long term effects of Prop 13 that mean that cities essentially raise revenue from other sources. This does not happen elsewhere in the country. But this is a revealing quote anyway, since it costs the city even more to serve low income or affordable housing than it does higher income housing. In any case, even some kind of fee to build housing would still offer societal benefits, even if 48 Hills is so intent on arguing on behalf of the fortunate few.

then any high-end housing that isn’t 30 percent affordable is making the crisis worse. Got that?

Nonsense. The building of extra high-end housing makes the older housing stock cheaper. Otherwise, as certainly happens in San Francisco and elsewhere, the people who would buy the high-end housing instead drive up the price of the older housing stock, which they buy (and often renovate, or kick out existing tenants). It is absolutely not the case that 30% of the new stock must be affordable, so long as it has a moderating effect on existing housing, which is certainly will as it does in areas that allow growth.

109 Frank Dobbs April 26, 2016 at 12:33 pm

It is a lack of IQ and creative thinking that causes us to have so much government regulation.

If the results of a free market were predictable, it would not be a free market. A market is always reacting dynamically to changing human needs and circumstances. One of it’s benefits is saving us the trouble of making predictions to answer every half-baked objection that middle brow progressives bring up to oppose to human freedom. Markets adapt. That’s what they do.

And where comes this idea that in America only the rich have money and can get their needs met by the market? The Waltons did not get rich catering to millionaires. Nor Ray Kroc. Many million dollar homes in NYC and SF were built to house poor people, and could be built again, if affordable housing had not been made illegal.

110 John Thacker April 26, 2016 at 12:37 pm

Show me any evidence, any credible evidence at all, that allowing the private market to build, baby, build in San Francisco today (without demolishing hundreds of thousands of rent-controlled units and creating a city like Manhattan or Hong Kong without the social housing, that none of us want to live in) will actually bring down rents and allow the middle class to stay, and I will listen. But as far as I can tell, that evidence doesn’t exist.

Tokyo doesn’t exist, apparently. Modern “build, baby build” Tokyo, with its low rises but dense, good transportation options, reasonable housing prices (and lack of housing price growth), tons of in-migration from the countryside, and lack of children seems like a perfect aspiration for San Franciscans, but they appear to not be familiar with it.

111 AIG April 26, 2016 at 1:22 pm

Living in cabinet-sized apartments, alone for the rest of your life…is something someone somewhere in the world…aspires to?

Christ.

112 John Thacker April 26, 2016 at 2:50 pm

We’ll chalk you up as another person unfamiliar with the Tokyo metropolis, then. Living alone in cabinet-sized apartments (or far, far away) more accurately describes the experience of my friends in San Francisco than those in Tokyo.

113 Massimo Heitor April 26, 2016 at 1:49 pm

“If you take the city’s own studies, which show that every 100 units of market-rate housing create a demand for 30 units of low-income housing”

Low income housing is referring to government subsidized housing, right? Government handouts and subsidies aren’t bound by the market at all. I don’t see how luxury housing inventory increases demand for government subsidies. Economically, everyone wants free government subsidies for nothing.

“because new rich residents want people to serve them coffee and fine wines and clean their clothes and their toilets and provide security etc.”

Sure, upper class residents want to purchase working class services… If the working class is priced out, the upper class will have a harder time hiring and will have to pay more or find some way to attract the labor that they want to purchase from. Or they can do without, and value living in that area less due to the limited service options they have.

114 Don Wallace April 26, 2016 at 4:42 pm

Reason people donʻt live in jungle splendor: jobs are in Honolulu.
Reason people donʻt buy instead of rent: median sfh is $713K
Reason people donʻt find reasonable rents: 90% of best Honolulu beachfront is owned by LLCs, VRBO and Airbnb have turned homeowners into landowners, Airbnb has even been caught listing tents in public campgrounds
SF is a peninsula, Oahu is an island, so the “move elsewhere, dishwasher and barista” cry doesnʻt work out. Floating housing may be the answer; submarine housing?
Hereʻs the latest source of homelessness: teachers lured to Hawaii by this meme about getting paid $50K to live in Paradise…
http://www.civilbeat.com/2016/04/living-hawaii-the-pipe-dream-of-teaching-in-paradise-goes-global/

115 Cooper April 26, 2016 at 6:04 pm

Another article that completely ignores the reality of the housing market in the Bay Area.

It’s not a San Francisco problem, it’s a San Mateo and Santa Clara County problem.

Zoning policies on the Peninsula are MUCH too strict. They make it nearly impossible to add density.

You can’t blame San Francisco for that.

116 Sean Brown April 26, 2016 at 6:09 pm

Why so much focus on home prices or rents? Why not more focus on net disposable income after housing, or happiness? Even if low-income people have to pay a high % of their wages to live nearby SF, their net disposable after-rent income may still be higher if wages are high enough…and if wages are not high enough, they will not move to SF…how is this wrong??

Also, repeating the “analysis” showing that Muni is “losing money” incrementally by serving new housing is insulting to the reader. The type of newbuild is very important; if it’s infill then these units should be already served well by existing Muni infrastructure, no? (Unless this analysis is just a veiled way to say “Muni variable operating economics are bad because Muni is very inefficient, so any additional ridership should be avoided” – which then brings the argument of what the road subsidy is of these people today living in Kentucky or another non-SF locale.)

117 Bert April 27, 2016 at 7:06 am

I love reading the ramblings of autistic libertarians.

118 Zach April 28, 2016 at 12:45 am

If you take the city’s own studies, which show that every 100 units of market-rate housing create a demand for 30 units of low-income housing

Well, right now the rich people are bidding up the crummy apartments. That’s better how?

The problem with the Bay Area right now is that it’s a bad combination of high prices and low quality. I’ve recently priced apartments in both San Francisco and Manhattan — San Francisco is more expensive. And then you go outside and get harassed by crazy people.

Say what you want about New York being a playground for the wealthy — they figured out how to sell the city as a luxury good. San Francisco is just as expensive, but it’s not a luxury.

Remember, all markets are liquid in the long run. Giving people a rotten deal isn’t a problem (for incumbents) until it becomes a problem. But if you wait until the people benefiting from a problem start suffering instead to make any changes, you run the risk of waiting so long that the problem can’t be solved anymore.

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