Be Careful What You Wish For

As we Californians have known for decades, San Francisco and its surrounding areas are the capital, or at least the West Coast capital of exclusivity — NIMBY City incarnate. Of course, urban policies, like other ideas have consequences, and one consequence of NIMBYism is that it tends to reduce housing supply while demand goes on. And in the case of highly desirable places, like the Bay Area, that means that housing prices go up, up, up. See Nick Bilton, Housing Market With Nowhere to Go (but Up), N.Y. Times, March 3, 2014, at p. B6. Go to http://bits.blogs.nytimes.com/2014/03/02/the-housing-market-with-nowhere-to-go-but-up/?ref=business

Not that it wasn’t foreseen . Back in 1979, when Agins v. Tiburon was before the California Supreme Court, Justice William Clark nailed it in his dissent when he noted that an adverse consequence of the Court’s ruling that denied recovery for regulatory takings and, indeed, denied that there can be such a thing as a regulatory taking, would be regulatory extremism that in the long run would cleave California into two states: one for the affluent folks who could afford fancy digs, and another one for the hoi polloi. That was back in 1979. And so it came to pass.

Today’s New York Times brings us a dispatch on what happened in good ol’ Baghdad by the Bay, when these urban/housing trends met an influx of denizens of Silicon Valley moving into the city. Those folks are by and large left-of-center, and talk a good game that tends to bring a warm feeling to the hearts of political liberals who are forever shedding tears over the housing plight of the poor folks. But when it comes to their own lifestyles, you are more likely to find them living the good life of the 19th century robber barons.

Thus, “Google alone, . . . minted 1,000 millionaires when it went public. Ditto Facebook. And Twitter? Some estimate 1,600. Tech worker bees are doing just fine, too, with average base salary now north of $100,000.” With over 5,000 start-ups in the city, “the influx of  well paid workers has pushed rents and home prices through the roof.”

In other words, San Francisco is a neat place to live in and to visit — if only for the views, the climate and the restaurants. So what’s not to like as a place to live, especially if you are generously compensated, have no children and don’t have to worry about the quality of local schools.? The upshot has been an upsurge of NIMBYism on a scale that is hard to imagine. Take a look at the SCOTUS opinion in the San Remo Hotel case, and you’ll get the idea. One of the city’s Supervisors concedes that “Our approach to housing in San Francisco is very dysfunctional. The system is intentionally designed to make is as difficult as possible to build new housing.” Really? Would those kindhearted folks whose hears bleed over the plight of badly housed poor minorities?

For a more recent, detailed description of what goes on in California, do read Liam Dillon, California Lawmakers Have Tried for 50 Years to Fix the State’s Housing Crisis. Here’s Why They Have Failed, L.A. Times, June 20, 2017. It demonstrates in painful detail that California legislature keeps on passing laws that ostensibly promote new housing, but go nowhere because cities and counties, where the actual construction permitting is supposed to happen, simply ignore those laws.

We could go on, but we suggest you read that N.Y. Times piece for yourselves. It’s short. But whether you do or not, do raise a glass and toast the memory of good ol’ Bill Clark who foresaw it all, and called it the way he saw it.

 

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