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Uncategorized Could there be a Grand Bargain solution to the...

Could there be a Grand Bargain solution to the housing crisis?

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If Ron Conway had helped with the Prop. G campaign, maybe tech and the tenants could have a real conversation about the future
If Ron Conway had helped with the Prop. G campaign, maybe tech and the tenants could have a real conversation about the future

By Tim Redmond

DECEMBER 1, 2014 — You talk about housing in this city, you get lots of response. And when you suggest something as crazy as the notion that seniority ought to be a factor in allocating affordable places to live in this city, you bring out everyone. Witness all the comments on my last housing piece.

For the record: I am not serious in saying that decent affordable housing should only go to people who have been here 20 years. In fact, what I wrote was

 If you’ve been in San Francisco for 20 years, and helped create and build this community, you have a right to stay here that trumps the right of someone with more money to move in.

The same should apply to someone who’s been here five years, or ten. Or two. You live here, you should have what in college we called “squatter’s rights:” It used to be a pretty well-accepted idea that nobody can force you to leave a place you rented legally, you pay for, and you take care of. Not except in unusual circumstances (the owner, for example, actually wants to move in).

What I’m really suggesting, though, is that we take a rather radical approach here, and ask some painful, honest questions — that start like this:

How do you allocate a valuable resource (affordable housing in SF) when demand greatly exceeds supply?

You can punt by saying: Build more supply. That’s the easy answer that everyone likes because it assumes that the free market works – and avoids the much harder issues. But let’s face it: Supply isn’t going to solve the problem. Certainly in the near term. We can’t possibly build enough housing in the next year or two to meet the demands placed on the city by the explosion of tech companies attracting high-paid workers from all over the nation – right now, today.

Right now, we need to solve the immediate problem. Then we can talk about the long-term issues.

And as I said last time we got into this, we need the tech community to help.

Ask the right questions

When you look at the city budget battles every year, you can argue that that city departments and services shouldn’t have to fight over scarce resources and the supervisors and the mayor shouldn’t have to make hard choices — because if we just taxed the rich there would be plenty to go around.

Maybe true, but again: That avoids the immediate challenge. Taxing the rich is hard in California. The underfunded mandate is huge – the city probably needs half a billion dollars a year to make up a structural budget deficit, and we aren’t going to get that from tax revenue in the next year. Right now, today, there isn’t enough money to go around, so how do we split it up? That’s what the budget hearings and discussions are about.

Same for housing: There isn’t enough to go around. We can talk about how to change that – and I will – but right now, we have a structural imbalance between supply and demand. How do you address that?

And my basic – and I suppose crazy, radical — answer for housing is: Not just on the basis of income and wealth.

Once you accept that concept – that the poor and the middle class have just as much right to live in San Francisco as the rich – and you accept a second concept – that the current situation is inhumane, horrible, unacceptable, and worse than just about anything else we could do — then you start looking for other solutions.

There is no perfect answer. But doing what we’re doing now – allowing speculators to toss out longtime residents just for quick profits, destroying communities in the process – is so bad that we’re beyond looking for perfect.

We’re looking for better. And we aren’t going to get there until we say that the current situation is so bad that almost anything – seriously, almost anything – would be an improvement over what we have.

Which means that the current system – driven by the private market – is so far from working that it’s more of a problem than a solution.

So I want to raise the question: How do you allocate housing by a means that is not purely economic competition?

How do you make sure that the critical necessity of life for long-term San Franciscans and their communities – that is, stable, affordable housing – is not destroyed by a cruel economic auction?

How do you balance the needs of the current residents who may not be rich with the needs of the well-funded companies that want a place for their workers to live that’s near where they work or near where the private buses pick them up and take them to work?

And is there a way to create a consensus around a housing plan that would serve everyone’s needs?

There are always welfare cheats 

Whatever we come up with will be flawed. There will be people who cheat. When I started at the Bay Guardian a million years ago, the publisher, Bruce Brugmann, told me that you can always find a welfare cheat. Someone always games the system. If you let that drive your policy decisions, you’ll go the wrong way.

Most people on public assistance are not Ronald Reagan’s Welfare Queens. Most are barely making it. Pick one bad example and you undermine some very good programs.

There are people with rent-controlled apartments that can afford market-rate rent. You take those people and make them the poster kids, and you can argue that rent control needs “means testing.” I can take the same approach and say that many landlords are so rich they don’t need anywhere near the rent they’re charging; let’s means-test property owners and force the rich ones to charge less rent.

Those are pointless political games. There is an exception to every rule. You have to look at the overall picture, which is pretty clear: Most landlords are better off than most renters.

Again, let’s be honest: Rent control is a form of housing seniority. The longer you’ve been here, the better you do. If we had real rent control, like Berkeley had in the 1980s, then the price of a place to live would be set when it’s first rented and stay the same no matter how many people move in and out, but the state Legislature outlawed that.

So now we have the blunt-instrument: Long-term residents get a great deal compared to newcomers. That gives landlords some bad incentives – they want to rent to people who won’t stay long, and they want to get rid of long-term tenants. That is,  if all they care about is profit.

I agree that the situation is unfair to some landlords. You have a tenant paying $800 a month for a unit you know you can rent for $5,000, and you feel cheated – especially if your friend down the street has an apartment where the old tenants died or moved out, and now she’s cashing in. The worst thing that can happen to you, I’m told, is to have your best friend get rich. You didn’t need a yacht until he got one; now you’re bitter.

But let’s remember that you aren’t losing money on the $800, since that price was set based on the value of the property when you bought it. You’re making money, just not as much as you could.

I repeat: The state of California has forced cities to make imperfect policy. And it was the landlord lobby that outlawed rent-control on vacant apartments and created this mess. Don’t blame me; I was on the other side.

So let’s go back to the problem: Too many people want to live in a small city right now, and there’s no room for them without forcing current residents to leave. Under today’s laws, current residents who are forced to leave by speculators and greedy landlords get no benefits at all; they’ve paid rent (and basically paid the landlord’s mortgage) for many years, but when the Ellis Act notice comes, they get a few thousand dollars (unless the Campos legislation survives in court) and a kick in the ass.

Facts are facts. Some people who work in San Francisco are going to have to live somewhere else, since there’s no way to build enough housing for the half-million commuters who arrive in town every day. So who decides which workers have to live in Stockton and waste four hours a day in transit — and which ones get to walk to work and have more time for their kids, for art, for music, for life?

If you let the current laws and private market decide, you are allowing a level of cruelty that is hard for anyone to justify. You’re also destroying the diversity of the city.

Some of the transitory nature of any city works itself out; some people want the extra space and the big back years and the culture that comes with suburbia, and are willing to pay the cost in transit time to get it.

But many more people – particularly young people – want to be a part of the very cool culture of San Francisco.

There are a limited number of housing units in this city that count as affordable; most of them are the existing rent-controlled apartments where tenants have been living for more than five years.

Pretty much everything that’s being built today is beyond the means of the vast majority of local workers. Maybe if we built 100,000 or more units, those prices would come down; I don’t believe it, but maybe. Could we do that without destroying the human-scale character of the city (Vancouver didn’t; the place looks like Hong Kong) and without demolishing the amazing historic architecture and diverse neighborhoods that draw so many people here in the first place?

There’s a fundamental flaw in the logic of the build-our-way-out crowd: The basic cost per housing unit in SF, I’m told, is $500,000 or more – and the private financiers demand such a high return on investment that no new privately built unit will ever go on the market for anything remotely affordable to the middle class, much less the working class Building 100,000 new units won’t bring down the price of land or construction materials. Build until kingdom come, and you won’t get places that sell for $300,000 or rent for $1,500 a month.

Another problem: We might very well wind up with 100,000 new condos for people who don’t actually live here.

And even if we decided to go that way, unless we went back to the bad old days of Redevelopment seizing property and bulldozing neighborhoods, it would take ten years. Maybe 20 years. Meanwhile: Evictions every day. Bitter fights over who gets to be here and who has to leave.

The Stockholm problem

If I could do it my way, and we had a housing lottery that took seniority into account, and people who have been here five years and wanted to start a family had more right to a bigger place than people who arrive last week, and people who have been here 10 years had more rights than that, and a lot of the new tech workers would have to live far out of town and accept the commute and the hotel workers and dishwashers who have been in the Mission for a long time would be able to move into nice hip flats with bedrooms for their kids, I think we’d have a better situation than we have now. Not perfect; nothing is perfect in a city under this kind of pressure. I said better, more fair.

In Stockholm, they have opted for fairness over capitalist opportunity; there’s strict rent control – and a 20-year waiting list for housing. That doesn’t work. The result: A lively black market in sublets. Lots of cheating, people selling spots on the waitlist, all sorts of things that undermine what the law set out to do.

That system, like ours, is imperfect. But at least the sublet money goes to tenants, not real-estate speculators. And the tenants have some choice in the matter.

I’m really lucky; I own my home. Bought the place 15 years ago when an alternative newspaper editor and a public-sector lawyer could still buy a house in this city. We never saw it as an investment; it’s the place we live, where our kids are growing up. These days, I’d be scared to have kids if I was renting; imagine trying to explain to a five-year-old why she was losing her bedroom, her neighborhood, her school, and her friends because her parents have less money than a tech worker who wants their apartment.

But as an owner, as long as I pay the mortgage on time, I have a choice. If Mark Zuckerberg wants to buy my house for millions of dollars, I can always say: No, thanks. I like it here.

If I’m a renter in a city with real eviction protections and a tech worker wants to sublet my $800 rent-controlled flat for $4,000, I can also say: No, thanks. My kids like their home and their school and their friends next door. Or I can do the math, say yes, and get some real financial reward for the loss of my home. My choice; not the choice of a group of speculators from Texas who care only about extracting cash from the SF market.

If I am a tenant whose landlord sells to speculators who use the Ellis Act to toss me on the street, I have no choice at all.

Is the Stockholm model perfect? Clearly not. Is it, overall, better than what we have in San Francisco? I don’t know. Because that gets into a much, much bigger question we will address in a moment: Do we have to plan our city around the needs of the current economic fad?

My analysis of the housing problem assumes, or course, that you accept what was once pretty mainstream thought but is now radical: The notion that a rent-paying tenant who takes care of the place and never violates the lease has the same rights to stay there as an owner, except in very unusual circumstances.

Is there a solution we can all accept?

I also realize that this is the United States, and it’s a capitalist society, and things you can do in Stockholm aren’t legal here. If we took 70 percent of the marginal income and wealth of the richest people in America, the way we did during World War II and the 30 years after, if we taxed corporate profits and prevented offshore tax havens, then there would be enough public money to buy up much of the available housing stock in cities like SF, and to build enough public housing for everyone who needed it. That’s the RIGHT answer to urban housing woes; it’s not a realistic one, not today.

So what can we actually do? Is there some kind of Grand Bargain that tech folks, who want a lot more housing, and housing activists, who want to protect existing communities, can all accept? There might be.

Let’s think about how it might look.

Community activists on the left would have to agree that the city is going to grow and we need to build a lot more housing. (I’m a bit shaky on this premise, see below, but I’m willing to compromise.) The tech folks would have to agree that the private market can’t possibly meet the city’s housing needs — and that all as much as possible of the new housing would have to be done through the public sector and nonprofits.

That, in other words, part of the answer to the housing crisis has to be removing housing as fast as possible from the private sector.

That should be fine, right? If tech firms want housing for their workers, they shouldn’t care who builds it. If new apartments are forever out of the private market, young engineers can still live in them. There’s just no money to be made buying, selling, and speculating in real-estate. Why should the tech companies care? They do that in the stock market. Different venue.

My commenters who are in the residential real-estate market say that rent control makes it unpalatable to own buildings in this city. I’m not seeing that; prices keep going up. But if we passed policies that brought down residential real-estate prices (yes, including mine), I wouldn’t be crying. The cheaper the housing, the easier for the city to buy it up, which is what could happen if landlords really decided to sell off in large numbers.

Here, I think, are some of the elements of a practical housing plan for San Francisco, something that could bring together well-meaning people across the spectrum:

First, do no harm. The evictions have to stop; everyone has to agree that long-term tenants can’t be thrown out to make way for better-paid newcomers. Tech money needs to fund a massive anti-eviction effort, from 100 new tenant lawyers or more to a new anti-spec tax to an agreement by all employers to ask workers to sign a pledge not to move into a unit cleared by eviction. Ron Conway has to join Erin McElroy on the picket lines every time there’s an Ellis Act notice. No candidate for any public office can accept a penny from anyone involved in evictions. We turn the Ellis evictors into social and political pariahs.

Not one tech mogul or tech executive gave one dime to the Prop. G campaign. With the kind of money Conway throws around on other issues, Prop. G could have won. Yes, Conway endorsed the reforms to the Ellis Act in Sacramento, but everyone know that was a long shot at best. He and his crowd have done nothing, zero, to help solve the problem right here in town. Come to the table not just with demands but with offers to help, and maybe we can all talk.

Eliminate other threats to the housing supply. Airbnb may have caused more problems for affordable housing in San Francisco than the Twitter tax break and the influx of high-paid tech workers. The current legislation won’t solve that problem. The city has to mandate that rental apartments are rental apartments, not hotel rooms. You have a spare bedroom you want to rent out to tourists? Great; apply for a permit to operate a Bed and Breakfast inn. City Planning gets them all the time. Most are approved. If too many come into one neighborhood, people will complain and the planners will have to slow down.

Oh, and the $25 million in back taxes that Airbnb owes would subsidize a lot of housing.

Something has to be done to stop the new housing from being sucked up by corporations and international travelers. A tax on non-primary residences is one option. That’s got to be part of the agenda.

Set a target for new housing at all levels – and let nonprofits build all of it. We need 30,000 new units? First, let’s make sure that’s a real figure, not something driven by short-term boomtown thinking. Is this tech growth real, for the next 10, 20, 30 years? If it is, let’s identify places where density can be increased (not just the Eastern Neighborhoods, and not just places where there are already low-income communities facing displacement). Then turn the whole thing over to the excellent, effective, proven nonprofit housing infrastructure that already exists in San Francisco.

If you assume a base cost of $500,000 per unit, a private developer will sell that unit for $1 million. A nonprofit only needs to get back the $500,000. At that price, a monthly mortgage payment is $2,881. Two people with middle-class salaries can almost afford that; it’s a lot lower than current rents.

Put up a modest $100,000 up-front public subsidy per unit, and use public land whenever possible, and those numbers come down to affordable housing for the middle class. Put up larger subsidies at the start and you can build housing for all levels.

Where does that subsidy money come from? How about tech agrees to support whatever taxes we need and can get on, say, commercial rents, development fees, non-primary residences is, transfer taxes etc.? How about every new office building gets assessed a realistic fee to pay for housing for workers?

And Ron Conway and his pals should help underwrite a campaign for a massive, multi-billion affordable housing bond act. That means higher taxes on homeowners; not perfect, but under Prop. 13, we all are getting a huge public subsidy already.

These tech folks are experts in the world of finance; let them come to the table and find the venture-capital startup money for a massive influx of public-sector and nonprofit housing.

Remember: This sort of development is sustainable. If nonprofits build housing and sell or rent it, they bring in revenue to do the next project. It takes upfront money, but not so much long-term money. If speculators and international investors can make a fortune on SF real estate, then there’s no reason the public and nonprofit sector can’t make it work, too.

Labor would like it; union carpenters, electricians, ironworkers, and plumbers make the same wage working for international speculators as they do working for local nonprofits. Building affordable housing creates construction jobs, too.

Could neighborhood folks accept a substantial new number of housing units and more density across the city if all of them were built outside of the private sector for the existing workforce? (And if they were sensitive to existing neighborhoods and weren’t horribly ugly?) Over time? At maybe 3,000 units a year? I think so. It’s worth a try.

I’d like to allocate those units by a lottery that gives precedence to current residents, by seniority. A couple living in a studio in the Mission who have been here for five years and want to start a family get a better shot at a two-bedroom unit than a young worker who just arrived. Of course, if the much-vaunted market works, that opens up their studio for the newcomer.

But we can’t legally do that. So we have to make a clear statement to the world: You want to move to San Francisco to take a job in a tech startup? Cool. But accept the idea that you might have to live a ways out of town, with a serious commute, when you first arrive.

I am told that some tech companies wanted to move to the East Bay, but their workers rebelled – they like living in the city where they work, because they don’t want to commute. Good for them. Lots of hotel workers and health-care workers and public-sector workers would like to live in the city where they work and not commute, too. And they have as much of a right as the software engineers. Back to my first point: Just because you have more money doesn’t mean you get that privilege. Maybe the Google buses need to create routes in El Cerrito and Richmond.

Use public money to buy existing affordable housing as quickly as possible and take it out of the private sector. In a housing crisis, the cheapest housing is the housing already there. It’s less expensive to save a rent-controlled unit than to replace it. If speculators can buy a four-unit building and flip it for a profit, the city ought to be able to buy it and keep it under rent-control and at least break even. Even at a loss, the city would spend less money buying buildings that now go to speculators, keeping them affordable, and avoiding evictions than it would trying to replace that housing with new construction.

I’ve never understood the reluctance to this concept at City Hall. You would think there might be creative solutions to making it easier and more affordable for the city to buy rent-controlled apartments. We gave Twitter a tax break to move here; how about we give property owners some sort of tax break if they sell to the city instead of to a speculator?

If we don’t want the city to be a landlord (and given our record with public housing, that might be reasonable), there’s an easy solution: The city just transfers every unit it buys into a community land trust, a limited-equity co-op or a nonprofit housing provider. Those already exist. We have demonstrated that the models can work.

Stop pretending that we’re an island. Why hasn’t anyone from the Planning Department, or the local tech leadership, or the Mayor’s Office, gone to Cupertino and Mountainview and informed the civic leaders there that San Francisco can’t and won’t be entirely and singularly responsible for solving the housing problem created by building massive tech campuses in places that build zero housing?

Could the tech leaders sign on to an agenda that gets them the new housing they need — housing that would actually be occupied by people who work in San Francisco, including their workers — but requires them to first help stop the evictions? Could they come to the table and say that, since the market has failed, public-sector nonprofit solutions are our only hope, and work with the community on that?

Could they accept the concept that they may be disrupting the economy but they don’t own the city and have to work with all the people who see this not just as an economic unit but as a community?

I hope so. I’ll go to those meetings.

Do we need all these tech companies? 

The second question is equally interesting: Should we, and can we, slow down the influx of rich tech workers? The answer, of course is yes we can… If we want. We can simply refuse as a city and a region to allow the office space that attracts those workers. Cut off all new office space in SF, stop building tech campuses on the Peninsula, and the startups will go somewhere else.

We can argue whether that’s a good idea or not (I think it’s not entirely wrong to discuss it; when we passed Prop. M a lot of big companies—Chevron — moved out to Pleasanton, which incidentally put them closer to a lot of their workforce and took some pressure off SF. That wasn’t a bad thing. It didn’t destroy the local economy. You have to be careful not to destroy innovation and the local economy, but it’s okay to say: too much, too fast.)

The city has certainly gone the other way: SF has, as a matter of policy, done everything possible to attract more tech firms. If we hadn’t done that, some might have gone somewhere else. If we had a national industrial policy (how Commie of me!) they would be directed to Detroit and places that need the jobs and investment. Meanwhile, though, we can say that the carrying capacity of SF is limited and we can only handle so much influx.

Would the unemployment rate in town be higher if we hadn’t become Tech Central? Probably. But how much of that change is due to unemployed residents without tech skills leaving town and new people who come here from someplace else to take jobs replacing them? That’s not a program to improve the local employment picture. That’s a program to change the population.

We seem to have tremendous demand for office space in this town; for now and the forseeable future, tech people want to be here. Near Stanford, near Cal, near the VC world on the Peninsula … if we turned away some tech firms, slowed down a bit, I don’t think we would wind up as a ghost town without any innovative new employment.

Remember: San Francisco has been a dynamic, world-class city for 150 years. The top employers are not tech: Government, health care, and hospitality dwarf the digital sector. This city has so many advantages that it’s not going to hit the dark ages of Detroit and other economic disaster areas just because the growth of one sector of the economy cools from superheated to just hot.

In fact, superheated isn’t good for innovation; what the real creative people – artists, writers, and yes, programmers – need at first is affordable space to live and work. You can price yourself out of the innovation world – and we’re getting pretty damn close.

I guess what I’m making is a plea for rational, community-based planning. And for all of us, including the tech community, to join in.

Worth talking about anyway.

 

Tim Redmond
Tim Redmond has been a political and investigative reporter in San Francisco for more than 30 years. He spent much of that time as executive editor of the Bay Guardian. He is the founder of 48hills.

140 COMMENTS

  1. Before you voice opinions on pubic banks, you should do some research into the massive amount of data and historical references that Ellen Brown and her followers have done on that subject. Just do a search for Ellen Brown and public banks and you will find all the information online.
    There are many successful public banks.

  2. JT – would YOU make a deposit in the ‘Bank of SF’, even if you knew they were gonna buy low-rent properties at market prices (the ‘market’ figuring a price that would result after getting rid of the low-rent problem)?

    Would you be willing to put your life savings in, knowing that the banks mission is to make less than other banks or other enterprises? After all, any bank can only ‘make money’ when they make a ‘profit’ – which by Greg’s standard if stealing from working people. Maybe you’d do better to bury it in a hole in GGP – at least it’d only be a bit soggy but it’d all be there (unless the 39% of homeless people that were homeless before moving here were to dig it up and use it for a good time).

    Anyway, good luck with all that.

  3. Actually, this may be one of Tim’s most insightful pieces.
    YOUR post is the one with “very little substance.”
    However, your comment about “nitrogen-rich products” is …substantive.

    The current white elephants we are saddled with are the result of business as usual; graft, corruption, and cronyism. Boondoggles like the new Bay Bridge span and the Subway To Nowhere would be PREVENTED by the formation and proper management of a municipal bank. Of course, that would require competent City officials.

    Presently, our “democracy” prevents the best and brightest from holding public office unless they happen to be millionaires. Either there are no competent rich people interested in the job, or the only wealthy people interested in the job are incompetent and corrupt.

    Property values are already falling; the speculation bubble may not burst like last time, but it IS deflating. Unfortunately, not fast enough to prevent the current wave of gentrification.

    And the only people who think “seniority” isn’t important are those who don’t have any.

  4. Daly City has no rent control and they have none of the problems the cities with Rent Control have. The only thing separating Daly City from SF is an imaginary city and county line….

  5. might want to start by fixing the black hole that is the SFHA before you start throwing more buildings at it…

  6. It’s not just when property’s change hands. I know a retired man who only makes $50k a year on a decent size apt building. He will be TICing the building this and exchanging into a regular apartment building that yields at least 8% on his capital of $3m which would be about $240k year. Why shouldn’t he be entitled to the highest and best use of his investment that he worked hard for 30+ years for? It’s not his fault appreciation vasty outpaced housing supply and that there’s an insatiable local demand for his assets.

  7. Wow. V little of substance on this post. While Tim posits a “Grand Bargain”, it sounds mostly like ‘take’ and little like ‘give’ (or visa versa). Mostly a rehash of his stated positions, and of course not much compromise of those, or where opponents can or might be able or willing to compromise. If there is none of this, then where is there a ‘bargain’ to be get?

    The idea of lowering prop values is interesting. It is probably the only way to get rents (and prices) down. And it means that someone will take a hit; but Tim’s hoping those are mostly out-of-towner foreigners or ‘speculators’. If it happens lets hope he’s right. However, as Tim said, there will always be cheaters. So I guess someone will figure out that they can make money when someone else gives away a deal (low yield rental units, industrila land with no industries) and then … there will be that fewer ‘deals’ to be had.

    The concept of some Land Trust scheme assuming responsibility for a big chunk of RC housing is really not feasible. Even over 20 yrs. The SFLT has been going for 10+ yrs and, has been stated, they own half a dozen props. And they aren’t even set up or willing to do the classic RC small props (2-6 U). I recently asked them to take a condo off my hands that contained a Lifetime Lease-holder with low rent and many problems. They don’t do single situations, and don’t know anyone who does. Obviously a struggling segment here; with potentially thousands in similar situations.

    Maybe if the Retirement Board were to hold off the Hedge Funds and invest instead in money losers like a 4U for $1.6M (collecting $0.06M annually before financing), then maybe giving long-time renters a break (btw, two of those above rentals would be a full market, so, really only giving the ‘seniority’ renters their continued “subsidy”) courteosly of SF retirees sounds sensible. Try to get the unions (or retirees!) on board with that.

    Muni Bank? If you luv the Central Subway and the Airport or Port Comm., then … what could possibly go wrong, eh?

    Guess I haven’t missed much.

    Yeah Sam posted “21 of 71” posts. But almost a third of those 71 were snipes as Sam, so not much real debate in the Comments section, and too few practical ideas. But hey, if you like the idea of ‘no comments’, head over to Randy Shaws site, where he’ll only post an occasional Hallaluiea, if that.

    I think the secret to a successful SF Money Tree would be to mandate that it be watered by nitrogen-rich products of politicians and bureaucrats and their dogs. Sounds like a Growth Industry not limited to the future Geary Underground, na?

  8. Clarification: I was not throwing shade in that comment…I sincerely am shocked to learn the truth.

  9. I am a long-time (12 years) renter who always thought that being a good tenant during a long tenancy was a laudable thing. I’m now learning I am probably loathed by my landlord.

  10. Given that those other areas already provide housing for the net 400,000 SF workers who commute into SF every day, doesn’t that imperative seem fair to you?

  11. Let’s remember that the State of CA recently made agreements with local municipalities re housing to build in next 20 years or so, and guess what? It’s virtually all to be in San Francisco and Oakland! Other job-creating areas got off the hook.

  12. Sam, my father is dying. Hope it’s a good enough excuse for “abandoning” San Francisco. But! I promise to be back! Meanwhile, can I still post here? Please, answer ASAP, because I need to know.

  13. Margarita, you claim to have left SF for Russia and yet here you are, posting on a SF blog, criticizing (some of) us for our comments.

    If Russia is so great, why are you here? Why aren’t you enjoying your grand new life with nary a thought about us. Because I guarantee you that nobody here is commenting on a Russian blog. If that is even allowed.

  14. > … and tell those who live in the city you abandoned how to live?

    Where did I tell anybody how to live?

  15. LOL Gary. so you must be right because I can’t point to a comment that (according to you) is no longer there!

    Priceless.

    How about this? Why don’t you link to the comment that is no longer there, to prove it vanished?

  16. “Moderate,” big D “Democrat,” “liberal,” “progressive” “left-wing, ” “extremist;” all are meaningless terms, or more precisely, they mean different things to different people. But “landlord,” “moneylender,” and “lawyer” is universally understood, and universally reviled.

  17. Wait, Margarita, you moved from SF to Russia? Good for you.

    And yet you have nothing better to do than post here and tell those who live in the city you abandoned how to live?

    Oh my God, that is so gracious and benevolent of you.

  18. Next time do your own damn research:

    “Need new school buildings, light rail, or waste water treatment? A German community can borrow from its local city bank (called a Sparkasse) for projects costing up to $200 million at about 1.5% interest. Compare that to the over 4.5% interest rate that Seattle pays to U.S. financial markets for its bond issuances in 2012.

    How can a local savings bank manage funding such large loans? The answer lies in the network of publicly owned banks in Germany. In support of each city bank, publicly owned banks at a regional and a federal level serve as “banker’s banks” – i.e., they provide credit risk sharing for the smaller city banks.

    Doesn’t such lending to local business and to city projects create excessive risk? That would be the first question raised by U.S. private bankers. To answer that question– no savers have lost money deposited in Sparkasse banks for the past fifty years and more. They came through the 2008 banking crisis without any bankruptcies – unlike U.S. banks. The explanation is professional banking management. In addition, the Sparkasse banks are structured like legal foundations, which shelters them from political meddling while their local roots ensures scrutiny by community leaders. The Sparkasse Group of all 417 banks enjoys solid ratings by Moody’s and Fitch (Aa2 and A+ respectively). Based on decades of earnings, this Sparkasse Group holds over $1 trillion in assets.

    As a proposal for U.S. cities, the success of the German Sparkasse system counters allegations about publicly owned banks necessarily putting taxpayer money at risk.”

    http://seattlepublicbankcoalition.org/latest-news/3-german-cities-have-public-banks-so-how-about-seattle#

  19. I don’t see that at all, Gary. You’re mistaken.

    Your pro-military concern is touching, however. I too support our troops and as many memorials as we can build.

  20. Joseph, I am a registered Democrat who voted for Obama last time out, and who has never voted GOP (well, except for Arnie, but you know . . )

    It’s a tell-tale sign that you are a left-wing extremist when you can look at a moderate Democrat like me and consider them to be a rabid right-winger.

  21. And speaking about caring for elderly! Lots of my clients, my fellow ex-Soviet compatriots, inhabit public housing apartments (pertinent to the topic of the conversation), and are eligible for my care via government-subsidized In-Home-Supportive-Services. I hate to say it, but most of these people didn’t work a single day in the USA, they were brought here by their children and put on Public Assistance. So, honest Americans, who spent their lives working their asses off, made savings, now have to deplete those saving paying $9,000 per month for home care, while my elderly Soviet compatriots get absolutely everything for free: SSI, public housing, health care, home care… Losing Cold War wasn’t that bad after all, I guess.

    Sources:
    Percentage of Russians in San Francisco, CA by Zip Code:
    http://zipatlas.com/us/ca/san-francisco/zip-code-comparison/percentage-russian-population.htm

    “The languages most often spoken by [IHSS – M.I. ]consumers are…
    • Cantonese (36.7%)
    • English (28.6%)
    • Russian (14%) (3122)
    …”
    http://static.squarespace.com/static/53726a44e4b075c0a113b916/t/544972bae4b00c203796876c/1414099642258/2014%20Annual%20Report-proof_5.pdf

  22. To vote for people to change the system, we need people to run who support change. This last election was a wash. No change. Where are the new leaders coming from? If they have a choice, more people might vote.

  23. > Margarita, can you cite the number of Russians who have migrated to the US, versus the number of Americans who have migrated to Russia?

    Why do I need to do that? I am one of them.

    > I suspect that if you wanted to live in one of the soulless concrete apartment buldings that decorate Moscow …

    Gee, I am already here. Not Moscow, just a middle of Russia. At least, I can afford my own room here!!! (In Moscow it would be about as expensive as in San Francisco). You see, dear capitalism made sure that when you care for elderly, your salary is so shitty, that you can’t afford to care for your own parents, without moving back to Mother Russia. Capitalism is one gigantic Ponzi Scheme, good for those who came here earlier (including SF tenants), who now can afford lavish life-style exploiting those who came to the game later. Of course, there are exceptions, but you know – exceptions just prove the rule.

  24. There is nothing to stop a government starting an enterprise to compete in the open market. And that has happened in the past, albeit usually when the government has taken over a failed enterprise like GM. And then the left whine that taxpayers are bailing out the corrupt and the greedy.

    The point is to create a level playing field. If I have a choice of six cell phone proviers and one is the city of SF, then fine, bring it on.

    But my sense is that progressives are not arguing for that at all. Ultimately they do not want (for instance) public power competing with PG&E and other energy suppliers. They want the city to have a monopoly – the very thing that they criticize PG&E for.

    Nor do they want city and bob-profit housing competing with private landlords. They want to put private landlords out of business. And if and when they do them of course, they will become the nightmare. Exempt from rent control they will pump up rents to feed SEIU.

    No thanks, I’ll take the private sector, warts and all.

  25. Margarita, can you cite the number of Russians who have migrated to the US, versus the number of Americans who have migrated to Russia?

    I suspect that if you wanted to live in one of the soulless concrete apartment buldings that decorate Moscow that Putin would welcome you with open arms.

    You might meet Greg there, who has mysteriously vanished since being outed here.

  26. Wrong, I made that comment in response to a subsequent comment to the article, where the author used a different name.

    There was no reasonable way to know that he was in fact the original author. Go read the thread again.

  27. Sorry, Sam, you are wrong. Before Amos posted any comment on that thread, you asked if he, as the author of the article, had ever done anything for veterans other ” than sit behind a keyboard and whine?”

    That was needlessly disrespectful and rude and it has NOTHING to do with your confusion about his name.

    And then, you don’t even apologize to him for what you wrote.

  28. To Sam: actually yes, the housing situation in the former Soviet Union was very far from perfect, yet nothing close to what’s going on in San Francisco: 6000 people sleeping on the streets, and what is this “eviction” thing? Nobody ever heard about evictions in the USSR. And a worker paying a half of his monthly income to rent … a room? A room? Unheard of.

  29. So the entire edifice of your argument rests on the premise that Russian didn’t lose the cold war and that the great socialist experiment in eastern Europe produced an optimal outcome?

    Er, OK.

  30. You must be from the facebook instant gratification clan. Yes, if you have 20000 programmers you can redesign your website in days.

    But there is also reality which everyone lives in. Let’s take some concrete examples:

    – when was planning for the eastern span of the bay bridge initiated?
    – when was planning for Mission Bay initiated? Hint: about 20 years ago
    – what about the central subway?
    – what is the time from conception to move in for a large housing development in SF (say > 100 units)?

    So as you can see, like it or not, major infrastructure projects including housing take many (or many many) years. Only some of this can be blamed on bureaucracy or NIMBYs. The truth is that any project involving such sums and impacting so many people will take a long time and involve lots of early planning. Thinking otherwise Is extremely naive.

    As for communist planning, well they beat the worlds greatest superpower in the space race. Even in 2014 the Capitalist Empire is dependent on Russian rockets and the space station. Of course that system had flaws, the greatest of which was human character (no different from capitalism). Oh, and speculators didn’t make 50% profit from evicting old ladies onto the street…

  31. Gary, at the time I questioned Amos’s service and contribution it was based on the fact that I had no idea at that time that it was he who penned the original article, because he used a totally different name. So the question was legitimate – he could have been some pacifist opportunist.

    If it makes a difference I will express regret for that, although I still think his comments should have clearly identified himself as the original author. If you are going to post a reply to your own article, use the same name!

  32. Read carefully before you waste more of my time. And I guess we could just print create $9 billion dollars out of thin air if we had to, like the money Wall Street got.

    “The Public Bank Project is dedicated to developing financial alternatives to the current system of Wall Street dominated finance to expand the policy options and autonomy of local governments. Our particular focus is on how local governments can pursue innovative policy initiatives to increase public sector investments in areas such as affordable housing, infrastructure, and targeted economic development within low-income neighborhoods and communities. We are dedicated to reinvigorating the relation between citizens and local government, and to promoting projects that create more socially just and ecologically sound cities.”

    http://seattlepublicbankcoalition.org/public-bank-solutions/21-public-banks-for-u-s-cities

  33. I wrote to Tim about this. Sam actually posted this on Amos Gregory’s article about the Veterans memorial: “Amos, what have you ever done to defend our nation or help veterans, other than sit behind a keyboard and whine?” (Amos is a veteran and organized the Veterans Alley mural project). While it is understandable that Sam didn’t know Amos’ history, there was no need for him to ask his question the disrespectful way that he did.

    This blog could be pivotal in helping to organize ideas and actions, but not when Sam is allowed to dominate every conversation with his toxicity.

    In the meantime, I’m looking for another blog to engage others in thoughtful discourse. I’ve had it with Sam, his dismissive words, his lack of respect and his arrogance, and frankly, I’ve had it with Tim’s inaction on this.

    I want to move ahead, not continue the mudfight.

  34. “Change is an investment opportunity. Examples are investing in gold (secured in a vault outside the US). hedging derivatives, Swiss and Singaporean currrency, offshore accounts, diamonds, hawala transfers, shadow banks and diversification.”

    Why Sam, you DO have a sense of humor!

  35. Joseph, as a potential investor, why would I invest in a bank whose business model was investing in the least profitable 10% of real estate transactions?

    How would I explain my due diligence to my shareholders and creditors if I were investing purely ideologically, in assets that by their very natire offer returns below the CPI?

    Think carefully before you answer.

  36. I also never under-estimate the power of envy. People never look at their financial situation objectively or in absolute terms. Rather they are always looking over their shoulder at their neighbors and, if one of them has more than they do, it makes them unhappy. Inequality is a relative notion.

    But revolution need hold no fear for the successful. There are various mechanism to ensure that one can profit from social upheaval as much as any other climate. Change is an investment opportunity.

    Examples are investing in gold (secured in a vault outside the US). hedging derivatives, Swiss and Singaporean currrency, offshore accounts, diamonds, hawala transfers, shadow banks and diversification.

    If the revolution ever comes, and the wealthy with their assets vanish, you will find yourself as masters of everything and nothing. Good luck with that.

  37. So in other words, don’t bother with that democracy thing with all those pesky elections?

    Just use violence whenever the elections don’t turn out the way that you personally want? Because you getting your way is always so much more important than the will of the people.

  38. One more time Sam: Funding would come from other local governments, public agencies, pension funds, and social investors. Capitalization of earnings would be a source of additional growth. A “Bank of San Francisco” will have no problem attracting depositors.

  39. They’ve taken over the world not just the city, although SF and a few other large US cities have become a huge magnet for international capital in the past decade or two.

    I’m not sure the electoral process is the place to be applying pressure for change these days. The wealthy have that process pretty well locked down. I’d look to recent events in Hong Kong, London and Ferguson for a better model. Taking protests to the seats of power – the politician’s offices, the homes of tech leaders and bankers, the corporate centers of exploiting companies – might be where the next battles lie. Everything recycles, including history. Maybe the late 1960’s, early 1970’s is coming around again.

    The Millennials are coming of age (the oldest turn 35 next year). If I were one of them I’d be pretty damned pissed at what the older generations have left behind – expensive housing, massive student loan debts, hundreds of billions of unfunded pension plans, federal debt that’s doubled in less than 10 years and a political process that rewards doing nothing.

  40. Jospeh, you went off on a tangent about “contributions” and I called you out on it.

    And if Tim as a homeowner can advance policies that would hurt him then so can landlords.

    But again, identify EXACTLY where you will find 9 billion? Show your assumptions and your working.

  41. The fact remains that your real problem is that I am an effective debater. I challenge the cherished shibboleths that underpin what passes for progressive thought here and that scares you.

    I get that. I really do. But the appropriate response is not to personally attack the messenger of inconvenient truths but rather to provide robust counter-arguments. So far you have not said a word about housing, and talked only about me. If I really were a troll I would relish in that attention but instead what I really seek is a honest engaged debate. Sadly few here seem able to do that.

    Oh, and don’t worry about me. I have a family, children, career, businesses, good mental and physical health, and financial security. Worry more about yourself if you cannot make the same claim.

    And please respect Tim’s call to play the ball and not the man. Tim has my email address and if had ever had an issue with me, he would have written to me. He has not. He has, however, replied to a number of complainants, reiterating that he values free speech and civility over censorship and personal attacks.

    I support Tim’s position. Do you?

  42. Ahh, at last we see your true motives! A landlord. How fitting, almost cliché. Remember Sam, the pitchforks are coming for you and your ilk!

    Change what subject? We finance all municipal activities using a public bank, including buying and building housing, expanding light rail, and providing free healthcare for all San Franciscans. What part of this is it that you don’t understand?

    And obsessive posting does not count as “winning,” except in your own mind.

  43. You’re a lonely guy S(p)am. That’s the only reason you obsessively post here and other local websites that have a pulse. Smart, thoughtful people don’t keep repeating their same points over, and over, and over. Consider that you have no family, friends or interests other than your psychotic need to anonymously taunt tenants, progressives and poorer people because of something inside you. If you can’t even understand that when a few people in a large group are always talking or always hogging the spotlight, then the others don’t get a chance to speak up, or their few words are drowned out among the crazy and obsessive posts.

    It’s obvious you’re unemployed or not doing anything meaningful with your time because of some inter-personal issues, and I try to empathize with that, but it’s unfair to the 48 Hills audience to be faced daily with a barrage of hostile, repetitive posts from someone who has nothing better to do than shout down and make fun of vulnerable populations like tenants and other marginalized groups. It’s pretty low behavior on your part. Despicable really.

    Your desire for “argument” is just your general neediness and desire for turmoil talking. Mature people don’t get into arguments about complicated subjects with people who obviously think differently from them. Assuming they cross paths, each states their point – ONCE – and moves on to productive activity. 48 Hills readers and commenters shouldn’t have to waste their time engaging with lonely, hostile posters whose main goal is to disrupt thoughtful discussions.

    You’ve been called out a number of times here and on SFBG. Why not take a few week time-out and do something else for awhile. Even marcos got the hint, and I always through you were more perceptive than him.

  44. No, Joseph, that is changing the subject from how to finance the municipal takeover of all rent-controlled homes in SF to just insulting another commentator here whom you cannot defeat in debate.

    I do contribute. I offer housing in SF. You do not.

    I rest my case.

  45. Yep, definitely malware.

    I repeat, we don’t need 9 billion at once.

    “Over time, the Bank would attract funding from additional sources, including other local governments and public agencies, pension funds, and social investors. Capitalization of earnings would be a source of additional growth.”

    And the Bank of North Dakota was successful long before the fracking craze started.

  46. Joseph, is your point that progressive opinions expressed here are never repetitive? I know for a fact that Tim trots out these theories and prescriptions about housing regularly and with only the slightest variation.

    Or is it somehow magically different depending on whether you agree with the repetitive ideology or not?

    And no stereotypes ever on 48 Hills? Absolutely. Except of course for the stereotypes about landlords, bankers, tech workers, conservatives, shuttle riders. moderates, whites, blacks, police, Republicans, corporations, successful people etc. etc etc.

  47. S(p)am. That’s brilliant.

    I think Sam/Tanya/John is a piece of malware programmed to make knee-jerk responses to key words in posts. You will notice he/she/it never has anything original to add, and is only able to repeat stereotypically “conservative” talking points.

  48. We routinely have elections. For instance, Ed Lee ran on a pro-growth, pro-jobs, pro-development platform last time and won easily.

    Perhaps that is your answer. Other than that, I don’t think you will ever get a workable definition of “fair” because it is so subjective.

  49. Gary, please supply examples of where long-term planning has worked.

    Oh, and I didn’t insult anyone. Another poster used two different names and I called him out on it. It’s important here to consistently use one name so we know who is posting what, particularly absent registration.

  50. Your real complaint is that truth tellers here undermine the progressive myth that their arguments are actually pragmatic and real. If you could refute me, you would, but instead seek to censor me – that age old habit of communist nations of suppressing free speech so that only the one great socialist truth gets promulgated.

    You offer not a single fact, statistic, argument or piece of evidence. You just hurl personal attacks at those whose arguments are superior. Tim would much prefer my posts here to yours – he has said as much.

    Oh, and Tanya wasn’t me.

  51. Ah yes, North Dakota, that bastion of progressive thinking that has led to it being the fracking center of the planet.

    Great example. Again, where does your 9 billion come from?

  52. Sam has made 24 comments out of 71 on this thoughtful article, over 1/3 of all posts. This is typical of every article posted on 48 Hills. Obsessive posters are always bullies, using multiple posts as a means to suppress the conversation of others who disagree with them. These individuals are toxic in the workplace and they are toxic on news sites like 48 Hills. Theses bullying posters are one of the main reasons many websites are banning comments altogether as the only effective way to suppress toxic, bullying behavior.

    Since S(p)am can’t contain his obsessive need to shout down every point of view he disagrees with, it’s time for 48 Hills to send S(p)am an email and ask him to either limit his posts per day (2 max) or ban him altogether. Yes, Sam/Anon/John will just start using a different name (eg, Tanya), but his always repetitive posts are obvious tells.

  53. @Sam, well congratulations for “red-baiting”, Sam. That and for insulting a veteran (Amos Gregory) on another thread makes you troll of the week.

    Long term planning has worked elsewhere and it can work here.

  54. hooray for someone putting out a list of possibilities. a mindless greed machine has taken over the city pitting people who just want jobs and a home against each other. the blind masters of capitalism can be voted out any time…. we just have to vote!

  55. > Sam: Ah, but who gets to define what is fair? You? Me? … The problem with basing any public policy on “fairness” is that we can’t agree on what that concept means.

    That’s the question! Who gets to define – people of San Francisco, I guess, either by direct vote or via our elected representatives. Sure, public policy can’t be based on “fairness” alone, but it should be at least considered, if for no other reason than the voters are more inclined to support policies they don’t perceive as blatantly unfair. Yes, we will never agree on what is fair, but I wonder if it will be easier to reach some kind of agreement on whether Policy 1 is more fair than Policy 2, which is all we need for incremental improvement – or at least for preventing the policy from deteriorating from simply unfair to completely ridiculous, which is what currently happening with Rent Control.

  56. It’s not that interesting discussing housing issues with the left since they approach the subject emotionally rather than factually. Real estate speculation is a huge business throughout the world, perhaps the largest business of all when inter-connected industries like banking, development and real estate transaction companies are added to the mix. Wherever located, including SF and the Bay Area, the local real estate industry is based on cash-flow, interest rate differentials, tax loopholes, opaque ownership structures, tax-free wealth extraction and many more benefits and complexities that keep lawyers and MBAs very busy and well-compensated.

    A recent Bloomberg article explains the Australian housing market from an investor’s perspective. The left ought to looking at issues like international cash flows, monetary policy and federal and state rules as their main perspectives before trying to formulate long-lasting housing solutions.

    http://www.bloomberg.com/news/2014-12-01/australian-landlords-take-record-debt-as-rent-yields-fall.html

    There are millions of Satyajit Deb’s all over the world. Frankly, tenants are merely numbers in a bank ledger, although a landlord usually doesn’t mention this. Personally I think it’s impossible to build a healthy community based on a landlord-tenant model. Non-profits can handle an area’s disabled and other at-risk communities, and they are a better model than private landlords for short-term rental needs (students, temporary workers, the seekers, the trust-funders, etc.), but without some sort of ownership interest in the property many SF tenants are merely long term transients, completely disposable when a property can bring a higher value to its owner.

  57. Not buying it. If the city could bankroll endless amount of ideological port simply by setting up a bank, it would have done so decades ago. A bank needs to attract deposits and it needs to invest those deposits for the best possible risk/reward ratio. When it doesn’t, we get something like 2008.

    But in this case the bank is simply a pass-thru vehicle for making horrible investments i.e. old rental buildings with deferred maintenance and low-paying tenants who intend to never move out.

    You probably could not design a worse business model for any financial entity. Effectively they would be buying only the worse properties, because those who own properties that flow well wouldn’t sell, but those desperate to exit their low return business would.

    It would be like going around buying all the pre-owned vehicles that car dealers cannot sell.

    Brent’s idea of a money tree makes more sense, and that doesn’t make much sense at all

  58. I’m glad you asked, Sam.

    Here’s one idea from Sup. Avalos’ Office: And we don’t need a $9 billion lump sum, although The Bank of San Francisco should have no problem attracting that kind of chump change here in Shangri-La.

    http://seattlepublicbankcoalition.org/public-bank-solutions/21-public-banks-for-u-s-cities

    “The depository institution would serve as the banking agent for the non-depository entity. Over time, the Bank would attract funding from additional sources, including other local governments and public agencies, pension funds, and social investors. Capitalization of earnings would be a source of additional growth.”

  59. Uh, Samster, get with the program…..

    “The question today is whether cities and counties can afford NOT to set up their own municipal banks, both to protect their money from confiscation and to take advantage of the very low interest rates and other perks available exclusively to the banking club. A government that owns its own bank can keep the interest and reinvest it locally, resulting in government savings of an estimated 35 percent to 40 percent just in interest. Costs can be reduced, and taxes can be cut or services can be increased. Banking and credit can become public utilities, sustaining the local economy rather than mining it for private gain; and banks can again become safe places to store our money.”

    http://www.huffingtonpost.com/ellen-brown/green-light-for-cityowned_b_3678608.html

  60. Joseph, charging a corporation slightly less payroll tax to ensure that they stay in the city is hardly giving money away. It is just collecting slightly less tax than otherwise.

    Again, where will this 9 billion come from? You appear to be struggling to answer.

  61. Thanks for your contribution to solving the problem.

    OBTW, the City DOES grow money on trees, and spends it on boondoggles,
    and gives it away to multimillionaires and foreign contractors.

  62. Chris, if rent control were such a successful policy then why is it that, after 35 years, we still have an alleged “housing crisis”? Rent control has not lowered rents – rents are up tenfold since 1979. It’s just that a few fortunate folks who “dug in” and hoarded their homes for decades now have a good deal at the expense of another small class of their fellow residents – those who took a risk and became providers of housing.

    Moreover, as noted here and elsewhere, price controls really only work in the short-term, to prevent price-gouging in times of war or emergency. When adopted long-term, the effect is for the providers of that business service to cease providing it, because returns are better elsewhere. That is why we see so many no-fault evictions – because rent control drives out landlords, thereby reducing the number of rental homes available.

    Reduce the rental housing stock at the same time as you reward those who never move and the result is inevitable. Anyone looking for a rental home in SF is royally screwed. It’s really a policy of moving wealth from dynamic ambitious young people to static passive old people, and that is not good for the city.

    Interesting, however, that you cited the big increases in market rents around 1979 (which has natural market causes) but never mentioned the even bigger hikes in property tax at the time (a man-made problem) which led to the analogous Prop 13. Still, it’s good to know you are a big supporter of Prop 13, which is “so crucial to SF in helping to maintain SF’s world famous diversity and working/middle classes.” by protecting them against their own government.

  63. As Mr. Redmond states above, “Rent control is better than no rent control. And all new housing is exempt anyway”

    To those commentators who dismiss rent control as unworkable, needing to be “fixed” or view it with outright hostility/contempt, please dont forget WHY rent control was introduced into SF in the first place: starting in 1979, rent levels in SF—and across the Bay Area—began to skyrocket without warning.

    Between 1979-1981, rent levels increased dramatically and arbitrarily with NO END IN SIGHT. Because of this situation, SF renters demanded relief. They turned to the SF Board of Supervisors and Mayor Dianne Finestein for a solution.

    Subsequently, the Board passed and Mayor Finestein signed into law SF”s 1981 Rent Stabilization Ordinance to bring arbitrary/unreasonable rent increases to a halt.

    Other Bay Area cities also passed local rent control ordinances at this time including Oakland, Berkeley, Hayward and San Jose among other municipalities. This is why rent control was introduced into the Bay Area and still exists to this day: to prevent arbitrary and unreasonable rent increases and prevent low and middle income tenant evictions.

    Rent control represents the single largest affordable housing public policy program in SF and other Bay Area cities. Without rent control, SF would have long ago become a city without a lower and middle income renter class. Seniors, fixed income, artists, etc would have been evicted or forced out long ago.

    This is why rent control continues to be so crucial to SF in helping to maintain SF’s world famous diversity and working/middle classes.

  64. It’s adorable that Joseph thinks that all we have to do is “start a bank” and then billions will magically appear.

    From where, exactly?

  65. Mapuchon would prefer that owners are condemned to forever run a lousy business just so he can afford to live in a desirable affluent town that is beyond his pay-grade.

    Whah, I wanna live in Aspen.

  66. The criticism is not that we should not plan. And in fact the city has a planning department, and there is regional and state planning too.

    The criticism is that very long-term plans tend to fail. They are invariably ideological rather than practical, and don’t account for the many unpredictable changes that will happen

    That is why planning tends to be short-term and more flexible. We’re not trying to build a communist state here, but rather plan how to let the market help us the most to get where we are heading anyway

  67. Progressives always try and reconcile the fundamental disconnect between NIMBYism and affordability. In their hearts they know that suppressing supply jacks up prices and values. But they hold both concepts dear and so simply ignore the fact that NIMBYism drives up costs for housing.

    It is always entertaining to watch the contortions they go through to claim that you van have NIMBYism and cheap homes.

  68. Gary –

    You’re taking what Sam said and twisting it. It wasn’t about a landlord choosing to only rent to people making over 100K. Means-testing is all about making sure a person who is making a 100K and still paying 1K a month in rent.

  69. It’s not a bad idea in any case; since rent is almost always more than property tax, the city will gain more from owning a building and renting it out. It will protect a building from Ellis evictions and flippers. What it won’t do is make SF affordable, only offer security to long-term residents.
    In the long run, a big chunk of property held in a single public trust will create enormous pressure to privatize it again and create a windfall for someone, but that wouldn’t be for a few decades more.

  70. You can’t get rent board pass throughs for “any significant increase in property taxes and mortgage expense”. What are you smoking?

  71. “overriding the voter-approved Prop M height limits and other voter-approved protective measures raises real estate values.”

    That’s totally backwards, brah. Limits and restrictions on land use make that land MORE VALUABLE, not less. Just compare SF prices to Houston, where there are practically no restrictions on what/when/where you can build. Kapish?

  72. @Sam wrote: “Just because you qualified to live in my building a decade ago does not mean that you still meet my standards now.

    Verification is reasonable.”

    So you agree with this: ““The building policy/requirement of a current apartment applicant/resident is that they are able to establish that their minimum annual income is at least $100,000,” the landlord wrote, according to a picture provided to Hoodline.”

    http://blog.sfgate.com/stew/2014/05/05/s-f-landlord-make-100k-or-get-out/

  73. The City could charter a municipal bank, saving hundreds of millions in fees, and hundreds of millions in interest payments. The City could borrow money from the bank at zero interest for projects, saving between 50% and 100% of the cost of the project, since there would be no interest burden when repaying the loan.

  74. Tim, if you really do understand rent control; how it works and it’s effect on the housing crisis, then you would understand why the comments devolve into it’s evils, (and the one or two positive comments from someone it actually benefits). If youre looking for a realistic place to start changing things, then start there…fixing rent control. Then maybe start buying a few buildings with other peoples money and see how that goes. baby steps……..

  75. Yes, and moreover buildings that are owned by a government, charity, church or non-profi are excluded from rent control. Which is part of why Randy Shaw has made so much money from the poor.

  76. Yeah, good points. Tim wants tech to hand over great gobs of money but what is Tim offering in return? To stop writing nasty things about tech? Why would they care?

    I think what Tim really hopes for is a massive uprising of the great unwashed and hoi polloi, such that the successful will tremble in fear and throw money at the blackmailers and intimidators just to make them go away.

    Real noble. Not.

  77. Tim, the SF community land trust is maybe the most established non-profit buying rental buildings and I believe that, to date, they have bought five buildings. It’s a cute idea but it doesn’t scale. It’s not hard to figure out why.

    There are about 175,000 rent controlled units in SF and let’s say they cost $500K each. How much money would they need to buy them all? I make it $8,750,000,000. Or a little shy of 9 billion.

    OK, I might even have dropped a zero there but the point is that wouldn’t even matter. The sum required is beyond anything that could conceivably be raised. So your idea is a pipe dream.

    So, Tim, your idea isn’t bad and I feel sure that many owners would be happy to offload their “building full of losers” at a market price to some clueless non-profit which would probably end up bankrupt. But to advance your idea you have to show where we come up with that 9 billion.

    And please don’t offer up that the nine million is from “taxing the rich”. The rich would vanish long before you ever got to tax them that much, even assuming that the voters approved it

  78. What you describe hasn’t happened anywhere. The real problem is that we have a lazy underclass who want the privileges of wealth and do not wish to pay for it.

  79. Of course it’s a subsidy. But the tenant lobby realize that makes them sound bad, and so they use euphemisms to disguise the fact that rent control is a form of welfare whose cost is pushed onto a remarkably small percentage of the residents, many of whom didn’t even have a chance to vote on it.

    It’s the tyranny of the majority over a minority.

  80. It’s not about what us invasive. It is about a property owner having a reasonable right to understand those whom he rents to. Why should vetting a tenant be a one-time thing only?

    Just because you qualified to live in my building a decade ago does not mean that you still meet my standards now.

    Verification is reasonable.

  81. Those people exist and are coming here whether we prepare for it or not.

    Better to prepare for it by building out, than sticking our heads in the sand as you evidently advise.

  82. What a well thought out set of ideas to keeping this a livable place. As for “market forces” an economy is an abstract creation WE make, not a law of nature. We can alter our economic models and ways of doing things to improve fairness. Let’s also be blunt. If the situation continues the economy will simply stall. If only software engineers and outside investors can own or rent in the city then you’ll be paying $30 for that latte, because the peons who do all the other work in this community will demand very high wages to commute in from the Central Valley. Either fix the system or the system will collapse on its own.

  83. When you have landowner/developers such Parkmerced removing thousands of existing affordable rent control housing units, you are creating an immediate housing shortage problem, regardless of a promise to build more affordable units. The new units will be based on future affordable rents, and will not be available for the current tenants for years. Where are they supposed to go now?
    The first step is to preserve what we have of affordable housing. Not tear it down.

  84. Public entities, non-profits, and not-for-profits, do buy up properties, but, there is no known tracking system in place that follows what happens to those properties over time. As we heard at a Planning Commission hearing, there is no system in place to track the new “affordable” properties coming onto the market now. Once the first tenant leaves or sells, what happens to the value? How many remain affordable?

  85. First, folks, I made it clear that if housing values came down in SF — which would cost me money (in theory, anyway, since I have no plans to ever sell my house) — I would be fine with that. I often joke that I’m the only homeowner in Bernal Heights who wants property values in the neighborhood to decline.

    We always seem to devolve into talking about rent control, which is fine, but please understand: I said over and over again that SF’s rent control policy is far from perfect. We as a city do what we can, operating under bad state laws. But rent control is better than no rent control. And all new housing is exempt anyway.

    Nobody’s said anything about my idea to have the city buy up housing as it comes on the market, taking it away from speculators and turning it over to nonprofits or land trusts. What’s wrong with that?

  86. “In Stockholm, they have opted for fairness over capitalist opportunity; there’s strict rent control – and a 20-year waiting list for housing. That doesn’t work. The result: A lively black market in sublets. Lots of cheating, people selling spots on the waitlist, all sorts of things that undermine what the law set out to do.”

    See, Tim, even when talking about the problems of a seniority-based system, your cognitive blinders still make it impossible for you to acknowledge the real problem. It’s not the “cheating” that’s the underlying problem. The real problem is how it shuts out a generation from being able to enter the city at all, to be a part of and build the community themselves. Indeed, everything you write indicates this is a feature in your preferred system, not a bug.

    Also, it’s entertaining how your so-called “grand bargain” with tech basically amounts to “Let tech companies consume half their market capitalization trying to make us happy without us doing anything at all.” In particular, you’ll still stand in the way of any efforts to build housing that aren’t the “right” kind of housing for you, even if they’re done entirely in compliance with existing regulations. (Only in the Bay Area would homeowners like yourself be allowed to squeeze the housing supply with such vigilance to protect your own investment in local real state.)

    Nonprofit housing? Sure, tech companies would see no reason to stand in the way of that – except it hasn’t been forthcoming. And ultimately, it’s not the responsibility alone to see that it is.

  87. And I am equally “sick and tired” of rent controlled tenants pretending they are not receiving a subsidy. Even the City Attorney, while defending the unconstitutional Ellis Act relocation payouts, admitted:

    “Under the status quo, the Landlords must, in effect, subsidize their tenants’ rent by the amount of the Monthly Rent Differential each and every month in perpetuity”.

    Levin v. City and County of San Francisco

  88. I agree and have been saying that for a while. How can we allow so much construction in all areas of the state when we see a trend toward an ongoing drought ? The answer is the profit sector rules , Environmentalists need to get loud very loud. Pure profit over everything else is destroying everything that is ( was ) great about the area and the state.

  89. A one-time credit check is much less intrusive than a yearly inspection of the 1040. I find it shocking that people in NY agreed to that, and I’d like to know what kind of dialog went on at the time. I can’t imagine people agreeing to set up such a thing again.

  90. Yes, I moved to SF for the salary and opportunity. And then stayed for the profits. I could happily live in any other major city in the US, and have lived in a few, as well as overseas. SF isn’t all that, and I really don’t get the “need” that some people feel to be here at any or all cost.

    But then if they are willing to be here at any cost, then someone needs to provide what they seek.

    Also note that you can get a SF salary and have half the housing costs, just by living seven miles east of downtown SF, and take a 10 minute BART ride every morning. I even here that Oakland is “hip” these days, which should matter for those who thinks such things are important.

  91. Correct, Mark. While there are passthrus for capex and O&M, the process of getting them is ponderous and onerous, involving administrative law hearings, lawyers, experts. And even then the passthrough may be denied for a number of technical and procedural reasons.

    Moreover any tenant who is below a certain income level is immune from paying the increase, which will typically be the case with many of these “lifer” tenants whose biggest achievement in life is clinging to their subsidized unit (and yes, I’ve heard it described that way by a tenant).

    Rent control makes running a rent controlled building less attractive, and so inevitably there are less of them each year. It should have been obvious from the start that that would happen. Price controls only work in the short-term for events like war and disasters.

  92. No matter, Chris claimed that landlords should be happy because the original rent covered the original costs. That becomes irrelevant if the original costs increase dramatically, as they do when a building is sold.

    So Chris’s statement is false. Whether it is prudent for someone to buy a building with a high price and low rents is another debate, but the city’s policies make that inevitable. And either way, if a building is no longer viable as a rental then, one way or the other, it will cease to be a rental.

  93. Simply put, if living in SF doesnt work for you…..then move, or dont move here, it doesnt seem like the best option, (unless of course you want to live here to make the SF wages…which is exactly why R.E. investors buy here) Why spend so much of your life being angry??

  94. More lies from Sam/Anon/John (and more evidence he doesn’t even live or own rental real estate in SF).

    Any purchaser of a rental apartment building (2 units or 100 units) can recover any significant increase in property taxes and mortgage expense when a building changes hands by increasing the rent. In fact, any expenses related to the rental property that sharply increases for an investor can be reimbursed by the tenants through higher rents by petitioning the Rent Board for an operating expense pass-through. So while the investor/speculator is watching the value of their property increase every year, they get the Rent Board to make the tenants pay for the increased expenses. Of course the landlords/speculators also write off the increased costs from their income, but the Rent Board does’t even take that into account.

    Any SF real estate landlord knows this, which tells us that John/Sam/Anon pretends to be someone is isn’t in order to troll this website. It’s time for 48 Hills to tell “Sam” to take a hike for both lying and for severe over-posting that drowns out the voices of hundreds of other potential commentators here.

    Sam and all the other real estate speculators who read and post here should be very grateful that Tim, the 48 Hills staff and the usual “left” posters have such a poor understanding of real estate finance and how speculation and gentrification really works. Fortunately for property speculators everywhere, the banks, politicians, pension funds, government bureaucrats and developers are all on the same page, even if the so-called “left” can’t even find that section of the book.

  95. it common knowledge among real estate investors that cities WITH rent control are the best places to invest. The upside of low rents is instant profit. This city is choking on it’s own rent control.

  96. The new owners you speak of took on those “greatly increased costs” by their own volition thanks to the disclosure of all current rental income prior to purchase. If they paid too much it was only because they we’re banking on getting rid of some people.

  97. @Sam, the problem is that we make decisions in ‘crisis-mode’, during boon or bust times.

    If the lack of housing is truly a problem, I believe that we could almost double the population of San Francisco (to about 1.5 million) without sacrificing the city’s character and quality of life. But that would take long-term, skillful planning. It also requires money to ensure that infrastructure is built to handle this population. I don’t know if you remember the fire that gutted the apartment complex under construction near AT&T park. SFPD complained that there wasn’t a high-pressure hydrant nearby. My first thought was why wasn’t the installation of a high-pressure hydrant a condition to permit the development? Why wasn’t the developer required to pay for this before construction began?

    What we have now is episodic, reaction-based planning and variances, often times without a master plan that includes improvement to infrastructure and amenities that are required for the increased population in existing neighborhoods or the new neighborhoods.

    Regarding the failure of such plans in communist countries, I don’t know anything about such planning. But the implication that the problem was with the plans and not the corrupt, ineffective economic systems seems disingenuous.

  98. Gary, my point was that you were suggesting a “20 year plan”. To my knowledge they have only been conducted in communist nations, and with obviously negative outcomes.

    And given the rapid changes in our society, planning more than a few years is fraught with problems and uncertainty. Could anyone have predicted SF’s housing situation back in 1004, before the big tech boom and a couple of busts? I don’t think so.

    But perhaps if you described what your 20-year plan is, we could more precisely critique it.

  99. “Gary, places like Russia used to make “20 year plans”. Is that your model here?”

    The first rule of conversation is engagement. If you restate that question without the trolling, dismissive attitude, I will answer.

  100. Ah, but who gets to define what is fair? You? Me? The simple idea that any inequality is “unfair” is very unfair on those who make sacrifices and took risks and worked hard to give them that extra income and wealth.

    Is it fair for a tech worker on 150K a year to enjoy a low rent while the elderly owner of that property relies on that income to pay for their retirement?

    Is it “fair” that two identical rentals can have rents that differ by thousands of dollars a month, purely because one person has squatted in the one place for decades?

    The problem with basing any public policy on “fairness” is that we can’t agree on what that concept means.

  101. > How about recognizing that life isn’t “fair” and get used to it.

    Another option is to work on eliminating unfairness, or, at least, making it less um… unfair. Otherwise we could still have slavery in this country, because we “got used” to it.

  102. Tim asks:

    “So who decides which workers have to live in Stockton and waste four hours a day in transit — and which ones get to walk to work and have more time for their kids, for art, for music, for life?”

    Right now, we the people decide. I can choose a small home in SF or a mega-mansion in Stockton for the same money. Or something in-between is best for most people. Why do you think it would be better if a “housing panel” of bureaucrats assessed my worthiness to live in one of the homes they allocate?

    Again: “But many more people – particularly young people – want to be a part of the very cool culture of San Francisco”

    What’s the idea here? That I should not be able to move into a home in SF because some kid somewhere thinks it would be “cool” to live here?

    The simple fact is that SF will never be able to solve its housing “crisis” in much the same way as any affluent town cannot. How could Aspen be made cheap? Answer, it can’t. The huge number of service workers that a wealthy place like that needs don’t live in Aspen. They live in Carbondale or Grand Junction or wherever, and commute in.

    The government cannot magically make a town cheap and, if SF were cheap, millions would flock here, so that of course it wouldn’t be cheap again. At one point here, Tim, you acknowledge that this is a regional issue, and you are right. In fact the burbs already help out SF by housing half a million people who work in SF, so criticizing the burbs for not bailing us out seems disingenuous here.

    What we really need to do is stop the SF exceptionalism, and recognize that the real city here is the Bay Area. Restrictive and NIMBY policies only work if they are region-wide. That Twitter can benefit by moving 10 miles to Brisbane is ridiculous. As is the case where a house in Daly City has no rent control when the identical house across the street in SF does.

    If SF was just a wealthy enclave within the Bay Area, nobody would complain, just like nobody complains about Presidio Heights being unaffordable to 99% of people in the City, or Aspen to 99% of Americans.

    We need to get off the idea that SF is special, and that the people who just happen to live here now are somehow more important and valuable than those who aspire to move here.

  103. Chris, your theory that a LL always makes a profit is not true. Mostly because you overlook the fact that buildings change hands, and the new owner has a much higher mortgage and property tax, but can still only get the original rent. That original rent might have been enough to cover the costs for the old owner, but the new owner has greatly increased costs.

    If you look at most Ellis’ed buildings you will find that they are not Ellis’ed by the original landlord.

    Also, you fail to understand how investors think. If a million dollar building in SF gets me 3% a year in rents, but one in San Mateo or Marin (where there is no rent control) gets me 5% in rent, then the only logical choice is to Ellis/sell my SF building and buy one in those neighboring counties.

    IOW, investors do not allocate capital so they can just scrape by. They want the highest return expressed as an annual yield.

  104. Y, you ask “Would anyone want their landlord to be that involved in their private life?”

    When you applied for your current rental home, you were obliged to give over all kinds of information, including salary and a full picture of your finances including a full credit check. He may also have run a background check for criminal convictions.

    If you agreed that was important then, why should that information never be updated? NYC’s rent stabilization requires that you submit an annual 1040 to your landlord. Why not?

    Gary, places like Russia used to make “20 year plans”. Is that your model here?

  105. 4700 words by Redmond of 48 Hills? Where to begin…

    1) Redmond is backing off—somewhat—on his seniority proposal, probably because he got flack that it was self-serving.

    2) Redmond asks, “How to allocate SF property?” In tranches: a) private ownership, b) non-RC rentals, c) RC rentals and d) state subsidized housing.

    3) “Supply won’t solve the problem,” is OPINION, and opinions differ. The housing haves—homeowner NIMBYs and secure RC tenants—in general do NOT want to build more. The housing have nots, in general DO want additional supply, hoping that they may someday get theirs.

    Redmond says, “we need the tech community to help,” but as commenters note, fat chance after bashing the techies for so long.

    Redmond considers taxing the rich then admits this isn’t likely, but commenters note the $8 billion SF budget is grossly large for a city our size, out of all proportion to other cities. Redmond doesn’t want to go there, though it’s certainly one of the “right questions.”

    Redmond says, we should allocate housing, “not just on the basis of income and wealth.” He may be right regarding current RC housing but he immediately loses the high ground by keeping off the table means testing for RC. He cites Reagan Republican attacks on “welfare queens”, without the least awareness of progressives similar attacks on “greedy landlords” and tears for “suffering evictees.” If we’re going to eschew emotionally laden, stereotypical anecdotes and talk numbers, that’s great! But everyone has to park their memes at the door.

    Means testing is NOT a “pointless political game.” It’s a part, perhaps a small part (until we have a statistical census who knows how big a part) of the solution.

    Redmond touches on vacancy control: Randy Shaw has written much about prior attempts to pass this, but if it’s got to be at the state level, it will take a huge political effort.

    Redmond discusses the “$500K per unit housing cost.” That number is suspect. Where is the spreadsheet or audit report to back it up? And who says the cost is set in stone? It’s a number based on high land cost, high labor cost and high planning costs, all of which can be pushed downward, within realistic limits.

    As for “The Stockholm Problem,” Redmond needs to do serious journalism. What is the reality in Stockholm? How about the German model of strict rent control with government promoted building, where the balance between rental supply and new housing has been maintained for decades, leading to a stable rent control system. I haven’t looked into this carefully, but it seems a model that might work in SF. The key—I have read—is balancing new construction to rental demand over the long haul. Sadly, in the distorted SF system, NIMBYism has choked off new building.

    Then, Redmond gets to a crucial reality… property ownership.

    I have said before that the SF Progressives made a devil’s bargain by pushing RC instead of home ownership. Tim Redmond and Randy Shaw, two SF progressive “leaders” are both home owners. Despite their politics, this creates an ironic class conflict with RC fellow travelers. Redmond and Shaw are classic propertarians. Both should re-read Ursula K. Le Guin’s The Dispossed.

    Within the context of a capitalist, property rights USA, San Francisco renters were bound to get screwed in the long haul. The progs probably didn’t realize this when they created RC. But over the long run, RC continues to hollow out out the progressive community. Redmond and Shaw may die without a progressive community surrounding them as a result.

    Finally, what would a Grand Bargain look like? Here is a framework for discussion:

    BUILD NEW HOUSING
    1) General plan for housing 50K new San Franciscans within 10 years. Of that, a mix of a) 30% market rate and b) 50% non-taxpayer-subsidized middle class built by private developers and c) 20% subsidized low income built by city-audited nonprofits.
    2) A portion of the 50K new housing in the low density west side on rapid transit corridors.
    3) Lower the cost of land in SF. That might mean a) a transfer tax on land sales, b) identification and banking of city-owned property for housing.
    4) Lower the cost of building in SF. That might mean a) streamlined planning, b) reform CEQA, c) nonunion construction as part of the mix.
    5) Control small scale NIMBYism by limiting hold ups on single family and sub six unit projects.
    6) Encourage large scale grassroots citizen involvement by a) fielding initiatives like a less onerous Prop G, b) sponsor state legislation for vacancy control, c) encourage involvement and debate on the big picture and the big projects.
    7) Private and nonprofit developers pay for transit and infrastructure.

    RENT CONTROL REFORM
    1) An annual, comprehensive census of RC, market rate, subsidized and ownership tranches.
    2) Means testing and phased in de-control for upper income RC tenants.
    3) Incentives to bring warehoused units onto the market.
    4) Strong eviction control.
    5) An opt-in city lottery for RC units with incentives for landlords.
    6) A more flexible capital cost pass along for small landlords.
    7) Repeal the Chiu AirBnB deal and replace it with strict controls.

    PROMOTE HOME OWNERSHIP
    1) Repeal condo conversion laws, but tax developer-speculators past a reasonable profit level.
    2) Create incentives for TICs, housing coops, community land trusts and other alternatives.
    3) City mortgage help program for low income RC tenants.
    4) Sweat equity program for low and middle income rehabbers.

    TAXES & BUDGET
    1) All revenue streams from housing into housing fund lock boxes.
    2) Revise city budget to bring down cost of government and fund housing with the savings.
    3) A tax on non-primary residences.
    4) A revised Prop G anti-flipper tax, with modifications, etc.

  106. Im sick and tired of hearing rental property owners claim that tenants living in rent controlled units are receiving a “subsidy” from landlords—that is patently FALSE!

    As Mr Redmond states in his above article, a renter who initially moves into a rent controlled unit pays the market rent level at the time. From that point forward, the property owner is granted a cost of living/operating expenses increase every year based on the federal CPI index.

    The property owners “net income” amount (profit) is maintained in perpetuity. THERE IS NO “SUBSIDY”!

    According to the rental property industry, the rule of thumb for rental income is that roughly HALF of a tenants rent amount is profit (or “net income” after operating expenses are accounted for)

  107. I agree about means-testing. I don’t think any landlord would like it if your salary drops, whether it’s because you get laid off or fired, because you decided to go on vacation, or because you decided to quit your job to start a new company or do something else that pays less. What if your parents support you? Would anyone want their landlord to be that involved in their private life?

    If you look at it another way, means-testing comes to the same thing as an income tax on renters, on top of the base rent, where the money, instead of going to public purposes, goes directly to landlords’ pockets. That’s not going to be very popular.

  108. Since local landlords are subject to Govt. price controls on their business, who don’t we put Govt. price controls on all tech companies that have an office in San Francisco? I’m sure uncle Ron or generous Mark would not have a problem with their portfolio companies or company locking the value of their product and giving the excess value/$ to SF to use for housing. We could use the billions to build housing for their employees.

    How about Leno? Chumped out? No guts? Who will carry the prog banner against big Ed? Please tell you can find an electable candidate Tim. Matt G to the white courtesy phone please.

  109. The last point, slowing down the demand, is the most important of all, I believe. SF alone has added 30,000 tech workers since 2009, and keeps adding more. It’s very easy to hire 50 programmers from out of town. It’s very hard to build 50 units of housing. It’s going to be pointless to build more housing of any sort if housing supply will keep falling behind fast-accelerating demand.

  110. Great article. I think one of the first steps should be to identify the ideal population for San Francisco and then have a 20-year plan to achieve the housing and infrastructure needed to support that population.

    Regarding means-testing for rent control, this is one example why it is problematic: In the last 25 years, I had 6 years of higher salary and 19 years of average salary, including now. If I had been means-tested out of my unit, now that my salary is lower, I’d have no place to go. And before commenters start pegging me as the reason for the housing crisis, my landlord is fine with me paying the rent as is. He is a good guy and our building is becoming a bit of a refuge for people who have been Ellised.

  111. Well, you got one thing right…we are living in the United States, thank God. Maybe you should construct your socialist utopia in a more suitable location.

  112. we should use all of the parking spaces in SF and build micro housing and give it away for free. (it makes as much sense as any of the dumbass suggestions in this article) How about recognizing that life isn’t “fair” and get used to it. Be thankful for what you have and drop the anger. It’s articles like this that fuel the stereotypes, which is the REAL obstacle to solutions

  113. The reason for high rents is up-zoning. We now know it as infill and densification. It doesn’t make any difference what you call it, or whether you fill the towers with housing or offices, overriding the voter-approved Prop M height limits and other voter-approved protective measures raises real estate values. The higher land values result in higher rents and evictions of long-term tenants. Until you address up-zoning you cannot solve the displacement problem.
    If you don’t care about the people who are being displaced, you should at least be stingy with the water supply during the drought. Environmentalists should figure this out soon. Fracking isn’t the only waste of water. We should put a stop to expansion while we are in the midst of a drought.

  114. “My analysis of the housing problem assumes […] that a rent-paying tenant […] has the same rights to stay there as an owner […]”

    Unacceptable assumption considering that the allowable annual rent increases in San Francisco are less than inflation. Long term renters are not entitled to what amounts to lifelong housing subsidies from private property owners.

    Also you recognize your very fortunate and secure position as a property owner in San Francisco. Please support all efforts to increase homeownership for more than the lucky few.

  115. The City does not suffer from “scarce resources”. The annual budget is $8Bn, the same as much larger cities like Chicago or Paris, and up $2Bn over what it was just a few years ago. SF could have used the bonanza towards fixing the Housing Authority and public housing, or finally building the underground Geary Muni line it so desperately needs, or expanding municipal fiber to break the AT&T-Comcast duopoly that is making us uncompetitive, among just a few examples. Instead, the wealth keeps getting frittered away on an unaccountable welfare-industrial complex, overpaid bureaucrats, rampant corruption, and grossly mismanaged capital projects like the Central Subway.

    As for striking a grand bargain with Tech after years of demonizing them, I wouldn’t hold my breath if I were you.

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