Poverty among plenty -- and it's getting worse

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Check out the news this week:

The Associate Press reports that there are increasing numbers of homeless and poor people in Silicon Valley. The piece almost sounds like something I would write:

Simply put, while the ultra-rich are getting even richer, record numbers of Silicon Valley residents are slipping into poverty. "In the midst of a national economic recovery led by Silicon Valley's resurgence, as measured by corporate profits and record stock prices, something strange is going on in the Valley itself. Most people are getting poorer," said Cindy Chavez, executive director of San Jose-based Working Partnerships USA, a nonprofit advocating for affordable housing, higher minimum wages and access to health care.

That will come as no surprise to people who lived through the last tech boom in San Francisco and are struggling to live through this one. Great wealth does not trickle down around here; it sucks up housing, drives up costs, and creates homelessness and poverty for the most vulnerable:

The causes for the growing disparity are complex, but largely come down to one thing: a very high cost of living. The median home price is $550,000, and rents average just under $2,000 a month for a two-bedroom apartment in this region that is home to many of the nation's wealthiest companies including Facebook, Apple Inc., Hewlett-Packard Co. and Google. For a family of four, just covering basic needs like rent, food, childcare and transportation comes to almost $90,000 a year, according to the nonprofit Insight Center for Community Economic Development. "The fact is that we have an economy now that's working well only for those at the very top," said Lawrence Mishel at the Economic Policy Institute in Washington, D.C. "Unless we adopt a new approach to economic policy, we're going to continue going down this path, which means growth that does not really benefit the great majority of people in this country."

Meanwhile, there’s a new study out, using a new approach to economic data, that shows that almost a quarter of all California residents live below the poverty line. The raw data, which is a bit thick, is here. There’s a state Senate report on it here. Sen. Leland Yee (D-SF) held a hearing on the data -- but uncovering the facts, while valuable, isn’t going to get anyone off the streets. And I don't understand why this isn't on the front page of every major newspaper in the state.

Before my trolls tell me that I hate the rich, let me repeat: I don’t hate anybody and I don’t blame rich people for what this country has created. That’s the fault of the policymakers who, since Ronald Reagan too office in 1981, have allowed the United States to embrace increasing social inequality.

Great wealth can make a country, well, wealthy. But if it’s allowed to stick entirely to the top, then if can do more harm than good.

And the reality is that, particularly in the South and the West, tax policy is designed to help the wealthy at the expense of the poor:

The fact is, the more the poor are taxed, the worse off they are, whether they are working or not. We all pay a huge price for this shortsightedness. Medicaid payments, food stamps, disability benefits — all of these federal programs swoop in to try to patch up a frayed safety net.

In other words, it’s not the Invisible Hand of Adam Smith causing the poverty in California. It’s not laziness that causes poor people to live on the streets. And it’s not just happening in San Francisco.

Now, some of the people who like to comment on this blog suggest that poor people just move somewhere else, that it’s too expensive to live in San Francisco and that’s just the way it is.

That's a bit of a harsh approach, and undermines the entire idea of a city as a community, where people of different income levels can live. But it’s also impractical; one of the reasons people come here, besides the weather and the scintillating level of intellectual dialogue (present company excluded) is that there are jobs here. Oh, and most poor people can' t just pack up, hire a moving van, relocate to another city, pay first and last month's rent, and live on savings until they find a new job.

There was a time when the federal government taxed great wealth, and used the money to invest in cities, building (and subsidizing) housing and infrasructure and funding jobs programs. Much of that is now gone; revenue sharing is a ghost of the past, eliminated in the Reagan era.

So now we have almost a parody of American economic news: The New York Times reports that the Dow Jones Industrial Average is setting new records, and on the same page notes that the numbers of homeless people and people living in poverty are also setting records.

This is by far the biggest issue, the most serious crisis, facing the country, and (unlike wealth) it trickles down to every level of government. And it seems as if nobody is paying attention.

Comments

If you do not, you cannot.

Is anyone shocked by this stunning revelation?

Posted by anon on Mar. 13, 2013 @ 4:50 pm

Whether one agrees with the economic viewpoints espoused on their opinion pages or not, one of the best ways to learn about the hundreds of facets of economic policy is reading the FT or WSJ for a couple of years.

In an article today, "Why your standard of living will keep shrinking: More people, scarcer resources, means less for everyone," was a pertinent quote.

"The economic contribution — revenue, profits and employment — of many recent innovations is difficult to gauge. Some technologies merely displace existing products. Apple’s success owed much to cannibalizing Blackberry devices, portable music players and personal digital assistants. Google and blogs disrupt established industries such as newspapers. Whatever their cultural impact, Facebook and Twitter may not have viable economic models.

Many new products and productivity measures reduce the number of workers needed. While the creators of these initiatives capture large benefits, employment and income levels are not significantly boosted, limiting the benefit to the wider economy."

http://www.marketwatch.com/story/why-your-standard-of-living-will-keep-s...

Posted by Guest on Mar. 13, 2013 @ 6:41 pm

"Many new products and productivity measures reduce the number of workers needed. While the creators of these initiatives capture large benefits, employment and income levels are not significantly boosted, limiting the benefit to the wider economy."

It's not about used-up resources. A combination of renewable energy technology, recycling, and resource management could make up for resource depletion, but the real problem is the "planned economy."

The problem with "planned economies" is who gets to do the planning and who gets a government subsidy to implement their plan. That's *always* the problem.

Posted by lillipublicans on Mar. 13, 2013 @ 9:51 pm

us needing less workers and having lower costs. This increases profits but that value is spread between fewer people. It is not a policy decision, as such, but a logical necessity.

The remedy, clearly,is for people to invest more in stocks, thereby sharing that profit.

Posted by anon on Mar. 14, 2013 @ 6:11 am

Au contraire, mon .
The "remedy" is worker-owned businesses.

Posted by Troll Killer on Mar. 14, 2013 @ 7:23 am

operate that way, threw the idea out even before they sold out.

Posted by anon on Mar. 14, 2013 @ 7:41 am

There are thousands of worker-cooperatives worldwide, and the number is growing. Locally, Rainbow Grocery, The Cheese Board, and Other Avenues have been around for decades.

Posted by Troll Killer on Mar. 14, 2013 @ 7:59 am

Yes, and they pay Walmart wages. What a solution!

Posted by Guest on Mar. 14, 2013 @ 8:10 am

has uncovered the secret of poverty in the USA: "Walmart wages," which describes the pay scale of most new jobs created in this country.

To use one of the most egregious examples of labor exploitation to try to discolor worker-owned businesses is laughable. Employees/owners of the local worker cooperatives do not need or qualify for public assistance (ie, food stamps), while many Walmart employees need and receive food stamps in order to survive.

The only problem with worker-owned cooperatives is that there aren't enough of them. By the way, Ben and Jerry's was not worker-owned. Hippie capitalism is still capitalism.

Down with stupidity!!!

Power to the thoughtful!!!

Posted by San Francisco Anti-Stupidity Campaign on Mar. 14, 2013 @ 8:27 am

What is "labor exploitation?"

Posted by Guest on Mar. 14, 2013 @ 8:39 am

Labor exploitation is paying workers just as much or less than is required for them to show up at work the next day.

Posted by marcos on Mar. 14, 2013 @ 8:40 am

How would paying a worker less than enough for them to show up work?

Posted by Guest on Mar. 14, 2013 @ 8:50 am
Posted by anon on Mar. 14, 2013 @ 9:29 am

the basis of your economic ideology.

Down with stupidity!!!

Power to the thoughtful!!!

Posted by San Francisco Anti-Stupidity Campaign on Mar. 14, 2013 @ 8:48 am

Paying people who must take these jobs just to survive wages that are less than they deserve so that management and stockholders can make high salaries and stock dividends.
Also, underpaying for raw materials; children making a dollar a day so you can talk on your cellphone or have cheap whatever.
The "free market?" Not even close. It's the Law Of The Jungle for workers, and government handouts and entitlements (socialism) for corporations.

Posted by Troll Killer on Mar. 14, 2013 @ 8:50 am

Who should decide what wages a person deserves? A commissar? A community board? Or the people making the transaction?

Posted by Guest on Mar. 14, 2013 @ 9:24 am

He who has the gold makes the rules or, in this case, decides how much your labour is worth relative to how much he would have to pay someone else to do the job.

If you think your pay is too low, and everyone does, that's a delusion. The market knows what you are worth far better than your own inflated idea of that.

Posted by anon on Mar. 14, 2013 @ 9:43 am

get elsewhere. If you only get paid $10 an hour, that is nobody's fault but your own.

Posted by anon on Mar. 14, 2013 @ 9:31 am

Where do you get your information?
Besides, I thought Walmart and their ilk was your standard of corporate excellence?

Posted by Troll Killer on Mar. 14, 2013 @ 8:33 am

If worker-owned businesses are the solution, but their members earn below-median incomes, what problem are they solving exactly?

Posted by Guest on Mar. 14, 2013 @ 8:44 am

Quality Of Life.

Posted by Troll Killer on Mar. 14, 2013 @ 8:52 am

Most of us didn't inherit much money from our families, but we did inherit a legacy from our predecessors, social insurance and a nation headed towards a leisure society where we work to live full productive lives instead if living narrow boring lives solely to work and consume endlessly.

Posted by marcos on Mar. 14, 2013 @ 9:10 am

You choose to because you want to buy "stuff".

Posted by anon on Mar. 14, 2013 @ 9:30 am

and better yet, share the wealth by making it a worker-owned business. No need to work for a corporation at all. In fact, more and more people are choosing this option. The days of corporate domination are numbered.

Posted by Guest on Mar. 14, 2013 @ 2:03 pm
Posted by Anon on Mar. 14, 2013 @ 2:15 pm

It's generally agreed by financial experts that the bond bubble will be a greater catastrophe than the real estate bust.

Posted by Guest on Mar. 14, 2013 @ 3:05 pm
Posted by Guest on Mar. 15, 2013 @ 1:27 pm
Posted by marcos on Mar. 14, 2013 @ 8:14 am

We have an Arizmendi bakery in Oakland and there are dozens of other worker-owned collectives throughout the bay area.

Posted by Guest on Mar. 14, 2013 @ 2:06 pm

Show me a chain of 10,000 stores that is a "co-operative".

Posted by anon on Mar. 14, 2013 @ 9:29 am

There is no "chain" of 10,000 cooperatives.
That would be something like an oxymoron;
it's exactly what cooperatives are NOT about.
However, there are far more than 10,000 cooperatives worldwide.

Posted by Troll Killer on Mar. 14, 2013 @ 10:12 am

REI is a "chain" of cooperatives, the WalMart of coops.

Posted by marcos on Mar. 14, 2013 @ 10:20 am

Show me examples in oil expro, manufacturing, shipping, mining, utilities, pharma.

Come on, shouldn't be hard.

Posted by anon on Mar. 14, 2013 @ 10:32 am

almost no fun:

Cooperatives within heavy industry: Oxymoron or a sign of the times?

Economic & Business Data
November 26, 2012

Large private corporations are neither the only players nor the only major investors in the production and trade of commodities. In the last few years, state-owned corporations and sovereign wealth funds have invested in foreign heavy-industry projects. And now, more discreet agents are also getting involved: cooperative enterprises.

Consider these three projects that have made headlines in Canada during the last few months:

Oil Refinery: In October 2012, Co-op Refinery Complex completed a $2.7 billion project to expand its oil refinery in Regina, Saskatchewan. Its production capacity of 145,000 bpd makes it the fourth-largest oil refinery in Canada. The company is a subsidiary of Federated Cooperatives (based in Saskatoon), a network of more than 250 retailers in Western Canada.

Nitrogen Fertilizer Plant: Indian Farmers Fertiliser Cooperative (IFFCO) and the Coop Fédérée have joined forces to build a $1.2 billion urea plant near Three-Rivers, Quebec. Based in New Delhi, India, IFFCO is a federation of more than 40,000 cooperatives. The Coop Fédérée (headquartered in Montréal) will market a portion of the plant’s output through a network of more than 175 points of sale in Canada.

Liquefied Natural Gas (LNG) Terminal: BC LNG is building a $400 million LNG terminal on the west coast of British Columbia. A principal partner in the project is the BC LNG Export Co-Operative, comprised of Haisla First Nation (situated near Kitimat), a dozen gas producers of intermediate size from both British Columbia and Alberta, and several Asian purchasers. The partnership will facilitate the transportation of, and international trade in, natural gas.

Although the general public often associates cooperatives with other sectors (e.g. agri-food, financial services), several are now involved in heavy industry. In the three examples provided, the cooperative formula provides a market independent from the large international private corporations that have tended to dominate the production and trade of commodities. The cooperative model facilitates access to resources (e.g. energy, fertilizers) and reduces price volatility, to the benefit of members.

http://en.ebdata.com/cooperatives-within-heavy-industry-oxymoron-or-a-si...

Get with the program, you troglodytes.....

Posted by Troll Killer on Mar. 14, 2013 @ 11:33 am

ever heard of, and that you had to google to find yourself?

You just made my point for me. Thanks.

Posted by Guest on Mar. 14, 2013 @ 11:42 am

No, you made my point for me.
Whenever Trolls are faced with facts
they either change the subject, hurl insults,
or made asinine, inane, childish statements
that are off-topic.
Enjoy your creepy little world.

Posted by Troll Killer on Mar. 14, 2013 @ 12:44 pm

that command the vast majority of US GDP are structured as a co-op?

Posted by Anon on Mar. 14, 2013 @ 2:14 pm

This must be malware;
no human is this dense.
Guardian, debug your servers!

Posted by Troll Killer on Mar. 14, 2013 @ 6:07 pm

each and every time I post a comment here if such hurdle might eliminate a large percentage of the trollery here on SFBG.com; a possiblity I consider viable.

Posted by lillipublicans on Mar. 14, 2013 @ 6:24 pm
Posted by Guest on Mar. 15, 2013 @ 1:27 pm

The dufus was asking a question that had nothing to do with the original argument, because he didn't want to accept his premise is patently false;
i.e. the "Ben and Jerry" argument.

Posted by Troll Killer on Mar. 16, 2013 @ 8:46 am

Co-op Refinery Complex is owned by a federation of consumer co-ops.

The workers don't own the others you mentioned either.

I was expecting you to mention Mondragon, darling of the left.

Posted by Guest on Mar. 14, 2013 @ 11:45 am

Electric cooperatives are an integral part of the $370 billion U.S. electric utility industry. They play a critical role in our nation's economy and in local communities.

Electric cooperatives are:

private, independent, non-profit electric utilities
owned by the customers they serve
incorporated under the laws of the states in which they operate
established to provide at‑cost electric service
governed by a board of directors elected from the membership which sets policies and procedures that are implemented by the co-op’s management

Distribution cooperatives are the foundation of the rural electric network. They deliver electricity to retail customers. Generation & Transmission cooperatives (G&Ts) provide wholesale power to distribution co‑ops through their own generation or by purchasing power on behalf of the distribution members.

In addition to electric service, electric co-ops are deeply involved in their communities promoting development and revitalization projects, small businesses, job creation, improvement of water & sewer systems and assistance in delivery of health care and educational services.

Facts at a Glance

840 distribution and 65 G&T cooperatives, a total of 905 NRECA co-op members
serve an estimated 42 million people in 47 states
18.5 million businesses, homes, schools, churches, farms, irrigation systems, and other establishments in 2,500 of 3,141 counties in the U.S.
over 12 percent of the nation's meters are customers of rural electric co-ops

To perform their mission, electric cooperatives:

own assets worth $140 billion (distribution and G&T co-ops combined)
own and maintain 2.5 million miles, or 42%, of the nation’s electric distribution lines, covering three quarters of the nation's landmass
deliver 11 percent of the total kilowatt‑hours sold in the U.S. each year
generate nearly 5 percent of the total electricity produced in the U.S. each year
employ 70,000 people in the U.S.
retire $600 million in capital credits annually
pay $1.4 billion in state and local taxes

Compared with other electric utilities:

Co-ops serve an average of 7.4 consumers per mile of line and collect annual revenue of approximately $15,000 per mile of line
Investor‑owned utilities average 34 customers per mile of line and collect $75,500 per mile
Publicly owned utilities, or municipals, average 48 consumers and collect $113,000 per mile

Posted by marcos on Mar. 14, 2013 @ 11:46 am

so-called "co-operatives"? Less than 1%.

Anyone is free to start a co-operative at any time. Just buy a business and run it that way. Or start your own. It's not a political question because nothing prevents you from doing it.

And yet you do not. Why?

Posted by Anon on Mar. 14, 2013 @ 11:56 am

The claim was about worker-owner cooperatives

Posted by Guest on Mar. 14, 2013 @ 12:03 pm

Thanx, Marcos.
Now tell me, did you have to use Google,
or did you write this off the top of your head?

Posted by Troll Killer on Mar. 14, 2013 @ 12:53 pm

I used google and hit up the electric cooperatives industry association's website, there are electrical cooperatives all over libertarian Texas that I remember seeing when I lived there and would drive out into the countryside.

I lived in a housing coop in Austin, have bought most of my food from coops of various forms for 30 years now and am convinced now more than ever that economic democracy is the way to go.

Posted by marcos on Mar. 14, 2013 @ 1:13 pm
Posted by Anon on Mar. 14, 2013 @ 1:47 pm

I always ignore or discount his posts since he writes as if he's an expert on everything. When he's not engaged in pissing matches with other posters, which account for 90% of his posts, he sometimes shares some interesting tidbits that you know have been stolen from someplace else but he never provides the link or the source of the interesting information. It seems he's constantly posturing to display his "brilliance" based on what others have thought or posted somewhere else. When challenged on the details of a particular subject he often retorts in snark or obfuscates since he doesn't really know the subject matter very well except that it sounded cool when he first read or heard it. It's the behavior of a 3rd rate mind posing as one of the city's brilliant intellectuals. Most people see right through it.

Posted by The troll knows on Mar. 14, 2013 @ 1:18 pm

I was actually complementing Marcos for his comment, and making a reference to a Troll who rebuked me for using Google.
If you Trolls did your Own Damn Research, common information wouldn't be such a shock to you.

Posted by Troll Killer on Mar. 14, 2013 @ 1:36 pm