The sharing economy is a lie

Uber, Ayn Rand and the truth about tech and libertarians

Disruptive companies talk a good game about sharing. Uber’s really just an under-regulated company making riches

 

The sharing economy is a lie: Uber, Ayn Rand and the truth about tech and libertarians
Ayn Rand, Rand Paul (Credit: AP/Manuel Balce Ceneta/Photo montage by Salon)

Horror stories about the increasingly unpopular taxi service Uber have been commonplace in recent months, but there is still much to be learned from its handling of the recent hostage drama in downtown Sydney, Australia. We’re told that we reveal our true character in moments of crisis, and apparently that’s as true for companies as it is for individuals.

A number of experts have challenged the idea that the horrific explosion of violence in a Sydney café was “terrorism,” since the attacker was mentally unbalanced and acted alone. But, terror or not, the ordeal was certainly terrifying. Amid the chaos and uncertainty, the city believed itself to be under a coordinated and deadly attack.

Uber had an interesting, if predictable, response to the panic and mayhem: It raised prices. A lot.

In case you missed the story, the facts are these: Someone named Man Haron Monis, who was considered mentally unstable and had been investigated for murdering his ex-wife, seized hostages in a café that was located in Sydney’s Central Business District or “CBD.” In the process he put up an Islamic flag – “igniting,” as Reuters reported, “fears of a jihadist attack in the heart of the country’s biggest city.”

In the midst of the fear, Uber stepped in and tweeted this announcement: “We are all concerned with events in CBD. Fares have increased to encourage more drivers to come online & pick up passengers in the area.”

As Mashable reports, the company announced that it would charge a minimum of $100 Australian to take passengers from the area immediately surrounding the ongoing crisis, and prices increased by as much as four times the standard amount. A firestorm of criticism quickly erupted – “@Uber_Sydney stop being assholes,” one Twitter response began – and Uber soon found itself offering free rides out of the troubled area instead.

What can we learn from this incident? Let’s start by parsing that tweet:

“We are all concerned with events in CBD …”

That opener suggests that Uber, as part of a community under siege, is preparing to respond in a civic manner.

“… Fares have increased to encourage more drivers to come online & pick up passengers in the area.”



But, despite the expression of shared concern, there is no sense of civitas to be found in the statement that follows. There is only a transaction, executed at what the corporation believes to be market value. Lesson #1 about Uber is, therefore, that in its view there is no heroism, only self-interest. This is Ayn Rand’s brutal, irrational and primitive philosophy in its purest form: altruism is evil, and self-interest is the only true heroism.

There was once a time when we might have read of “hero cabdrivers” or “hero bus drivers” placing themselves in harm’s way to rescue their fellow citizens. For its part, Uber might have suggested that it would use its network of drivers and its scheduling software to recruit volunteer drivers for a rescue mission.

Instead, we are told that Uber’s pricing surge was its expression of concern. Uber’s way to address a human crisis is apparently by letting the market govern human behavior, as if there were (in libertarian economist Tyler Cowen’s phrase) “markets in everything” – including the lives of a city’s beleaguered citizens (and its Uber drivers).

Where would this kind of market-driven practice leave poor or middle-income citizens in a time of crisis? If they can’t afford the “surged” price, apparently it would leave them squarely in the line of fire. And come to think of it, why would Uber drivers value their lives so cheaply, unless they’re underpaid?

One of the lessons of Sydney is this: Uber’s philosophy, whether consciously expressed or not, is that life belongs to the highest bidder – and therefore, by implication, the highest bidder’s life has the greatest value. Society, on the other hand, may choose to believe that every life has equal value – or that lifesaving services should be available at affordable prices.

If nothing else, the Sydney experience should prove once and for all that there is no such thing as “the sharing economy.” Uber is a taxi company, albeit an under-regulated one, and nothing more. It’s certainly not a “ride sharing” service, where someone who happens to be going in the same direction is willing to take along an extra passenger and split gas costs. A ride-sharing service wouldn’t find itself “increasing fares to encourage more drivers” to come into Sydney’s terrorized Central Business District.

A “sharing economy,” by definition, is lateral in structure. It is a peer-to-peer economy. But Uber, as its name suggests, is hierarchical in structure. It monitors and controls its drivers, demanding that they purchase services from it while guiding their movements and determining their level of earnings. And its pricing mechanisms impose unpredictable costs on its customers, extracting greater amounts whenever the data suggests customers can be compelled to pay them.

This is a top-down economy, not a “shared” one.

A number of Uber’s fans and supporters defended the company on the grounds that its “surge prices,” including those seen during the Sydney crisis, are determined by an algorithm. But an algorithm can be an ideological statement, and is always a cultural artifact. As human creations, algorithms reflect their creators.

Uber’s tweet during the Sydney crisis made it sound as if human intervention, rather than algorithmic processes, caused prices to soar that day. But it doesn’t really matter if that surge was manually or algorithmically driven. Either way the prices were Uber’s doing – and its moral choice.

Uber has been strenuously defending its surge pricing in the wake of accusations (apparently justified) that the company enjoyed windfall profits during Hurricane Sandy. It has now promised the state of New York that it will cap its surge prices (at three times the highest rate on two non-emergency days). But if Uber has its way, it will soon enjoy a monopolistic stranglehold on car service rates in most major markets. And it has demonstrated its willingness to ignore rules and regulations. That means predictable and affordable taxi fares could become a thing of the past.

In practice, surge pricing could become a new, privatized form of taxation on middle-class taxi customers.

Even without surge pricing, Uber and its supporters are hiding its full costs. When middle-class workers are underpaid or deprived of benefits and full working rights, as Uber’s reportedly are, the entire middle-class economy suffers. Overall wages and benefits are suppressed for the majority, while the wealthy few are made even richer. The invisible costs of ventures like Uber are extracted over time, far surpassing whatever short-term savings they may occasionally offer.

Like Walmart, Uber underpays its employees – many of its drivers are employees, in everything but name – and then drains the social safety net to make up the difference. While Uber preaches libertarianism, it practices a form of corporate welfare. It’s reportedly celebrating Obamacare, for example, since the Affordable Care Act allows it to avoid providing health insurance to its workforce. But the ACA’s subsidies, together with Uber’s often woefully insufficient wages, mean that the rest of us are paying its tab instead. And the lack of income security among Uber’s drivers creates another social cost for Americans – in lost tax revenue, and possibly in increased use of social services.

The company’s war on regulation will also carry a social price. Uber and its supporters don’t seem to understand that regulations exist for a reason. It’s true that nobody likes excessive bureaucracy, but not all regulations are excessive or onerous. And when they are, it’s a flaw in execution rather than principle.

Regulations were created because they serve a social purpose, ensuring the free and fair exchange of services and resources among all segments of society. Some services, such as transportation, are of such importance that the public has a vested interest in ensuring they will be readily available at reasonably affordable prices. That’s not unreasonable for taxi services, especially given the fact that they profit from publicly maintained roads and bridges.

Uber has presented itself as a modernized, efficient alternative to government oversight. But it’s an evasion of regulation, not its replacement. As Alexis Madrigal reports, Uber has deliberately ignored city regulators and used customer demand to force its model of inadequate self-governance (my conclusion, not his) onto one city after another.

Uber presented itself as a refreshing alternative to the over-bureaucratized world of urban transportation. But that’s a false choice. We can streamline sclerotic city regulators, upgrade taxi fleets and even provide users with fancy apps that make it easier to call a cab. The company’s binary presentation – us, or City Hall – frames the debate in artificial terms.

Uber claims that its driver rating system is a more efficient way to monitor drivers, but that’s an entirely unproven assumption. While taxi drivers have been known to misbehave, the worldwide litany of complaints against Uber drivers – for everything from dirty cars and spider bites to assault with a hammer, fondling and rape – suggest that Uber’s system may not work as well as old-fashioned regulation. It’s certainly not noticeably superior.

In fact, prosecutors in San Francisco and Los Angeles say Uber has been lying to its customers about the level and quality of its background checks. The company now promises it will do a better job at screening drivers. But it won’t tell us what measures its taking to improve its safety record, and it’s fighting the kind of driver scrutiny that taxicab companies have been required to enforce for many decades.

Many reports suggest that beleaguered drivers don’t feel much better about the company than victimized passengers do. They tell horror stories about the company’s hiring and management practices. Uber unilaterally slashes drivers’ rates, while claiming they don’t need to unionize. (The Teamsters disagree.)

The company also pushes sketchy, substandard loans onto its drivers – but hey, what could go wrong?

Uber has many libertarian defenders. And yet, it deceives the press and threatens to spy on journalists, lies to its own employees, keeps its practices a secret and routinely invades the privacy of civilians – sometimes merely for entertainment. (It has a tool, with the Orwellian name the “God View,” that it can use for monitoring customers’ personal movements.)

Aren’t those the kinds of things libertarians say they hate about government?

This isn’t a “gotcha” exercise. It matters. Uber is the poster child for the pro-privatization, anti-regulatory ideology that ascribes magical powers to technology and the private sector. It is deeply a political entity, from its Nietzschean name to its recent hiring of White House veteran David Plouffe. Uber is built around a relatively simple app (which relies on government-created technology), but it’s not really a tech company. Above all else Uber is an ideological campaign, a neoliberal project whose real products are deregulation and the dismantling of the social contract.

Or maybe, as that tweeter in Sydney suggested, they’re just assholes.

Either way, it’s important that Uber’s worldview and business practices not be allowed to “disrupt” our economy or our social fabric. People who work hard deserve to make a decent living. Society at large deserves access to safe and affordable transportation. And government, as the collective expression of a democratic society, has a role to play in protecting its citizens.

And then there’s the matter of our collective psyche. In her book “A Paradise Built in Hell: The Extraordinary Communities that Arise in Disaster,” Rebecca Solnit wrote of the purpose, meaning and deep satisfaction people find when they pull together to help one another in the face of adversity.  But in the world Uber seeks to create, those surges of the spirit would be replaced by surge pricing.

You don’t need a “God view” to see what happens next. When heroism is reduced to a transaction, the soul of a society is sold cheap.

 

http://www.salon.com/2015/02/01/the_sharing_economy_is_a_lie_uber_ayn_rand_and_the_truth_about_tech_and_libertarians/?source=newsletter

Lies, Damn Lies, and Tech Diversity Statistics

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Some of the world’s leading Data Scientists are on the payrolls of Microsoft, Google, Facebook, Yahoo, and Apple. So, it’d be interesting to get their take on the infographics the tech giants have passed off as diversity data disclosures. Microsoft, for example, reported its workforce is 29% female, which isn’t great, but if one takes the trouble to run the numbers on a linked EEO-1 filing snippet (PDF), some things look even worse. For example, only 23.35% of its reported white U.S. employee workforce is female (Microsoft, like Google, footnotes that “Gender data are global, ethnicity data are US only”). And while Google and Facebook blame their companies’ lack of diversity on the demographics of U.S. computer science grads, CS grad and nationality breakouts were not provided as part of their diversity disclosures. Also, the EEOC notes that EEO-1 numbers reflect “any individual on the payroll of an employer who is an employee for purposes of the employers withholding of Social Security taxes,” further muddying the disclosures of companies relying on imported talent, like H-1B visa dependent Facebook. So, were the diversity disclosure mea culpas less about providing meaningful data for analysis, and more about deflecting criticism and convincing lawmakers there’s a need for education and immigration legislation (aka Microsoft’s National Talent Strategy) that’s in tech’s interest?

 

Slashdot

The secret to the Uber economy is wealth inequality

uber-inequality

WRITTEN BY  Leo Mirani

Of the many attractions offered by my hometown, a west coast peninsula famed for its deep natural harbor, perhaps the most striking is that you never have to leave the house. With nothing more technologically advanced than a phone, you can arrange to have delivered to your doorstep, often in less than an hour, takeaway food, your weekly groceries, alcohol, cigarettes, drugs (over-the-counter, prescription, proscribed), books, newspapers, a dozen eggs, half a dozen eggs, a single egg. I once had a single bottle of Coke sent to my home at the same price I would have paid had I gone to shop myself.

The same goes for services. When I lived there, a man came around every morning to collect my clothes and bring them back crisply ironed the next day; he would have washed them, too, but I had a washing machine.
These luxuries are not new. I took advantage of them long before Uber became a verb, before the world saw the first iPhone in 2007, even before the first submarine fibre-optic cable landed on our shores in 1997. In my hometown of Mumbai, we have had many of these conveniences for at least as long as we have had landlines—and some even earlier than that.
It did not take technology to spur the on-demand economy. It took masses of poor people.

Silicon Valley catches on

In San Francisco, another peninsular city on another west coast on the other side of the world, a similar revolution of convenience is underway, spurred by the unstoppable rise of Uber, the on-demand taxi service, which went from offering services in 60 cities around the world at the end of last year to more than 200 today.

Uber’s success has sparked a revolution, covered in great detail this summer by Re/code, a tech blog, which ran a special series about “the new instant gratification economy.” As Re/code pointed out, after Uber showed how it’s done, nearly every pitch made by starry-eyed technologists “in Silicon Valley seemed to morph overnight into an ‘Uber for X’ startup.”
Various companies are described now as “Uber for massages,” “Uber for alcohol,” and “Uber for laundry and dry cleaning,” among many, many other things (“Uber for city permits”). So profound has been their cultural influence in 2014, one man wrote a poem about them for Quartz. (Nobody has yet written a poem dedicated to the other big cultural touchstone of 2014 for the business and economics crowd, French economist Thomas Piketty’s smash hit, Capital in the Twenty-First Century.)
The conventional narrative is this: enabled by smartphones, with their GPS chips and internet connections, enterprising young businesses are using technology to connect a vast market willing to pay for convenience with small businesses or people seeking flexible work.
This narrative ignores another vital ingredient, without which this new economy would fall apart: inequality.

The new middlemen

There are only two requirements for an on-demand service economy to work, and neither is an iPhone. First, the market being addressed needs to be big enough to scale—food, laundry, taxi rides. Without that, it’s just a concierge service for the rich rather than a disruptive paradigm shift, as a venture capitalist might say. Second, and perhaps more importantly, there needs to be a large enough labor class willing to work at wages that customers consider affordable and that the middlemen consider worthwhile for their profit margins.

Uber was founded in 2009, in the immediate aftermath of the worst financial crisis in a generation. As the ride-sharing app has risen, so too have income disparity and wealth inequality in the United States as a whole and in San Francisco in particular. Recent research by the Brookings Institution found that of any US city, San Francisco had the largest increase in inequality between 2007 and 2012. The disparity in San Francisco as of 2012, as measured (pdf) by a city agency, was in fact more pronounced than inequality in Mumbai (pdf).
Of course, there are huge differences between the two cities. Mumbai is a significantly poorer, dirtier, more miserable place to live and work. Half of its citizens lack access to sanitation or formal housing.
Another distinction, just as telling, lies in the opportunities the local economy affords to the army of on-demand delivery people it supports. In Mumbai, the man who delivers a bottle of rum to my doorstep can learn the ins and outs of the booze business from spending his days in a liquor store. If he scrapes together enough capital, he may one day be able to open his own shop and hire his own delivery boys.
His counterpart in San Francisco has no such access. The person who cleans your home in SoMa has little interaction with the mysterious forces behind the app that sends him or her to your door. The Uber driver who wants an audience with management can’t go to Uber headquarters; he or she must visit a separate “driver center.”

There is no denying the seductive nature of convenience—or the cold logic of businesses that create new jobs, whatever quality they may be. But the notion that brilliant young programmers are forging a newfangled “instant gratification” economy is a falsehood. Instead, it is a rerun of the oldest sort of business: middlemen insinuating themselves between buyers and sellers.

All that modern technology has done is make it easier, through omnipresent smartphones, to amass a fleet of increasingly desperate jobseekers eager to take whatever work they can get.

After being exposed, undercover cop draws gun on protesters in California

By Evan Blake and Gabriel Black
12 December 2014

On Wednesday night, a plainclothes police officer dressed as a protester had his identity revealed before drawing his baton and pistol on a crowd of protesters and reporters in Oakland, California. The officer and his partner have been accused of trying to incite the crowd towards violence before they were exposed as provocateurs.

The two police officers had been wearing bandanas over their faces throughout the march. KTVU news reports that at one point during the march a protester who suspected the two of being officers pulled down one of the officer’s bandanas. The news station reported that, “the two policemen started to walk away, but the protesters persisted, screaming at the two undercover cops.”

Then one officer, “pushed the protester aside. The man responded by pushing back and then the officer tackled him to the ground, handcuffing him. The crowd, incensed, began to gather around them.”

Undercover cop aims his gun at a photographer

The officer who had pushed back the protester took out his baton and began beating the demonstrator after the scuffle started. When a crowd began to surround the officers, the one using his baton drew his pistol and aimed it at the heads of those around him.

Photographs show that the people the policeman was aiming at were all reporters and photographers. Reuter’s photographer Noah Berger, freelance journalist Courtney Harrop, and San Francisco Chronicle photographer Michael Short were all threatened with the officer’s pistol, ostensibly for taking photographs of the scene.

The two officers soon arrested the man who had been beaten with the help of riot police who had been tailing and monitoring the protest march. The two plainclothes police have subsequently been identified as California Highway Patrol officers.

According to the DailyDot, protesters claim that the two undercover officers attempted to “disrupt the peaceful protest and provoke violence.” These witnesses say that the officers banged on windows and encouraged protesters to loot businesses.

Despite widespread coverage of the Monday night freeway occupation, the Wednesday night uncovering of police provocateurs has gone unreported in most major news outlets. As of this writing, the only major newspapers to have covered the story are the New York Daily News and the local San Francisco Chronicle.

The Wednesday evening protest was one of several nightly demonstrations against the police killings of Michael Brown and Eric Garner. Oakland and neighboring Berkeley have seen protests every night since Saturday.

The march on Wednesday night came on the fifth straight night of protests against police brutality centered in Berkeley, which grew to their peak on Monday night, when over 1,500 marched through Berkeley and 200 protesters blocked traffic on Interstate-80, the busiest freeway in the East Bay Area. The protests have gradually dwindled on following nights.

During the weekend protests, two men were also accused of working for the Oakland Police Department. A video was posted online comparing the two accused undercover cops with images of two police officers with the OPD.

Acting Oakland Police Chief Howard Johnson made a remarkable statement about placing undercover police agents in protest organizations in 2003, stating, “You don’t need to have some sort of skill to be able to infiltrate these groups. If you put the people in there from the beginning, I think we’ll be able to gather the information. And maybe direct them to do something we want them to do.”

Oakland police made a total of 170 arrests during the week in November following the exoneration of Darren Wilson (the Ferguson, Missouri police officer who killed Michael Brown), while in San Francisco more than 80 people were arrested during protests on Black Friday alone.

Injuries to protesters over the course of the past five days include broken legs, at least two induced seizures, several head wounds and concussions from baton blows to the head, and deep welts from rubber bullets. Stephen Lam, a photographer and journalist working for Reuters, was pepper sprayed.

On Tuesday night, a crowd of over 500 assembled in downtown Berkeley, which gradually dwindled during a march to Oakland, where the roughly 200 remaining protesters led another freeway occupation on Highway 24. They blocked traffic for half an hour, at which point the California Highway Patrol (CHP), Berkeley Police Department (BPD) and Oakland Police Department (OPD) used tear gas and rubber bullets to disperse the protesters.

Later, when protesters had been herded under the freeway, two officers fired 4 rubber bullet rounds from above, while still on the freeway, reportedly hitting one protester on the ear, one on the ankle and another on the head. The person shot in the ear was sent to the hospital for treatment.

 

http://www.wsws.org/en/articles/2014/12/12/prot-d12.html

Stirring portrait of aging drag queens at the last gay bar in the Tenderloin

12.08.2014


Donna

San Francisco has changed both rapidly and radically over recent years. As it’s become more appealing both for cosmopolitan urbanites and the exploding tech sector, gentrification has blessed The City by the Bay with the most expensive one-bedroom apartment in America, even surpassing New York. Many mourn the loss of an earlier San Francisco and its formerly affordable counterculture and queer subculture, while San Francisco documentary photographer and filmmaker James Hosking manages to actually catch some of the twilight.

For his series, Beautiful by Night, Hosking documents the lives of three senior drag queens Donna Personna, Collette LeGrande and Olivia Hart, performers at aunt Charlie’s Lounge, the very last gay bar in San Francisco’s Tenderloin district. The notoriously seedy Tenderloin has managed to mostly resist gentrification on the merits of its reputation and a concerted effort by inhabitants. Still, without the surrounding culture of a former San Francisco to sustain it, the once vibrant queer scene has faded.

Hosking’s photographs are intimate and unflinching, but the mini-documentary is also an amazing portrait of three drag foremothers. Their reflections and reminiscing are complex but disarmingly at peace, and their performances and beauty rituals are (as expected) hypnotic.


Olivia


Collette LeGrande


Olivia


Collette


Olivia talks to shopkeeper


Gustavo at home


Gustavo/Donna


Gustavo/Donna


Collette performs Ke$ha’s “Tik-Tok”


Donna backstage between sets


Via Feature Shoot

 

http://dangerousminds.net/comments/stirring_portrait_of_aging_drag_queens

Don’t call it gentrification

“Dispatches Against Displacement” author James Tracy on fighting to keep cities from becoming rich-only playgrounds

Don’t call it gentrification
(Credit: AP/Michael Dwyer)

In the early 1990s, a punk rock kid named James Tracy moved from the gritty North Bay city of Vallejo to nearby San Francisco and got a job driving a delivery truck for a thrift store in the predominantly Latino, working-class Mission district. During his pickup runs, he noticed that many landlords were making generous donations — the left-behind belongings of former tenants. This was a few years before the rise of the first dot-com boom, but even then, Tracy said, “It was obvious to me that a storm was coming.”

The storm was more like a hurricane. In the late ’90s and early aughts, a torrent of venture capital poured into Silicon Valley and waves of would-be tech entrepreneurs flooded into San Francisco, displacing tens of thousands of poor folks, artists, musicians, activists and families who were evicted to make room for higher-paying tenants. In order to get around San Francisco’s rent-control laws, many buildings were demolished and sterile live-work lofts and generic-looking condos rose from their ashes.

Just as with a real hurricane, this storm also had a body count. In one notorious case, a landlord overcame housing activists’ attempts to block the eviction of an 82-year-old woman, who died shortly after being forced out of her longtime home. Many more San Francisco seniors have met similar fates since then.

Resistance to this onslaught of displacement was widespread, fraught with internal clashes, sometimes victorious, occasionally militant, and occasionally surreal. In one case, the San Francisco police seized Situationist and Marxist books from the library of an anti-displacement propagandist who had been wheat-pasting posters throughout the Mission encouraging people to burn yuppies’ cars and sabotage hip restaurants. Through it all, James Tracy was on the front lines — sometimes quite literally, as a member of groups that would protest on landlords’ doorsteps or during anti-eviction occupations at the homes of families facing displacement.

In his new book, “Dispatches Against Displacement: Field Notes From San Francisco’s Housing Wars,” Tracy not only looks back with a critical eye on the recent history of anti-displacement organizing but also offers solutions for how these struggles can be more successful moving forward. With rent prices for one-bedroom apartments often surpassing $3,000, the need for a book like this is painfully obvious.



You start the book with this quote from Herbert Marcuse: “The housing crisis doesn’t exist because the system isn’t working. It exists because that’s the way the system works.” How does this permanent state of crisis exemplify a system that’s operating as intended?

In the simplest sense, it works well for those who make exorbitant profits from a crisis. It’s working well for speculators and throwing not only tenants, but first-time homebuyers and even some small landlords under the bus. In a larger sense, the housing crisis achieves ideological goals. It tells a public story that it is natural that the rights of this small group of speculators should outweigh everyone else’s need for a safe and decent place to live. The evidence to the contrary is literally under every overpass in America, yet even those harmed by the crisis often defend it.

One of the most interesting things about the idea of a crisis is the issue of when the media decides to call it one. It wasn’t until after the cascading foreclosure crisis in 2008 that the term “housing crisis” was broadly used. This is because homeowners can still generate a great deal of more sympathy than renters. If you look at the history of housing policy, it is access to homeownership, not the construction of public housing, which was the centerpiece of the New Deal reforms. You can trace the narratives from there, homeownership is part of the American Dream, renting makes you part of a second class. Yet homeowners (and I am one) are subsidized as well through income tax breaks. Who is the system working for? The finance and real estate sectors are doing just fine by it. Everyone else is either on the chopping block or standing nearby it.

You cite an infamous quote by a San Francisco city supervisor saying “a little gentrification is a good thing” in explaining your decision to use the term “displacement” instead of “gentrification.” Do you think “gentrification” has too many positive connotations to be a useful word for people challenging displacement? Would you like to see people stop using the “g-word”?

I prefer to use the word “displacement” because it drives home the end result of gentrification: someone loses their home and their community. You can’t play fast and loose with the word! On one end of political thought, there is this underlying assumption that higher-income people improve a low-income community just by arriving there. It plays into this mythos deeply imbedded in our psyche that  rich people will somehow randomly meet their neighbors and help them up the economic ladder.

During the Great Depression there were thousands of cases of neighbors banding together to militantly protect each other from eviction. We saw scattered examples of this in the wake of the Occupy movement, but it didn’t become a widespread phenomenon in response to the still ongoing foreclosure crisis. Why do you think people are so much less likely to use militant or even confrontational tactics now?

You see echoes of this today, although not nearly at the same levels during the Great Depression. Eviction Free San Francisco has had a lot of success in pushing back evictions, most recently in the case of Benito Santiago using a direct action model. There is a lot of innovative housing organizing going on today. Just a few examples are Picture the Homeless; NYC’s anti-vacancy work; in Chicago, the anti-foreclosure and home occupation movement is cutting edge.

Housing activism tends to do best against the backdrop of larger social and movements. In the 1930s, there were large mass-based movements that elevated the needs of working-class people. Movements influence each other both tactically and morally. The formation of the trade union movement, the campaign to free the Scottsboro Men, built a sense of boldness and political consciousness that could easily be translated into a neighborhood context. Also, today’s neighbors have far less connection with each other thanks to climates of fear and the impacts of the greatest work speedup in U.S. history. The fact that both lower-income and middle-income people are working 50, 60 and 70 hours a week damages our ability to organize on the level of the Unemployed Workers Movement.

As you say in the book, “The Clinton Administration decided that the way to deal with public housing’s problems was with a wrecking ball.” Clinton’s history of enacting steep welfare cuts is much more well-known than his equally destructive housing policies. Why do you think this aspect of his legacy doesn’t get as much attention?

Clinton’s housing policy was part and parcel of welfare reform. Certainly, both federal income assistance and public housing needed changes. But Clinton and Congress adopted a model based in punishment and austerity. He was literally worse than the Republicans at every turn. His version of HOPE VI, the program to demolish and rebuild public housing, removed the very reasonable guarantee of one-to-one replacement of demolished housing. I had the privilege of working alongside residents of public housing in San Francisco.

Most of the demands they made on the Housing Authority and Housing and Urban Development were very fundamental. They wanted the renovation process to result in living-wage jobs for their kids, they wanted to come back to their communities. Yet, this was met with scorn, disdain and, in some cases, criminalization. It was an example of what happens when liberals accept the same worn-out assumptions about poor people as conservatives.

Clinton was able to use progressive critiques of the worst aspects of federal housing such as the warehousing of the poor in substandard conditions to accomplish the conservative goal of privatizing formerly public housing. How are progressive arguments still being used in the service of displacement of urban poor?

The Clinton administration argued that public housing was a form of segregation and that the HOPE VI process was a form of integration, essentially fulfilling the promise of the civil rights movement. He was halfway right. Local governments did in fact use public housing programs to reinforce segregation. However, what we saw in the aftermath of HOPE VI was actually a form of resegregation as the displaced just resettled where they could afford to find homes. Simply a different kind of warehousing.

You see this today under the Obama administration as public housing authorities are attempting to implement drastic rent hikes as a perverse incentive toward self-sufficiency. You want people to move towards self-sufficiency? Create good-paying public works jobs and the social supports like childcare and education to make this happen. You can’t essentially apply a Wal-Mart mentality to public policy and expect to change lives with a cheap strategy like this. The people of North Beach Public Housing taught me that the solutions to poverty start with the input, insight and creativity of people facing poverty. The rest of us can and should lend our levels of expertise and skills when needed. But to think that government is going to design solutions without these voices symbolizes they very worst impulses of liberal and conservative frameworks.

We’re in the midst of a wave of “spatial deconstruction” — basically the opposite of white flight — where poor people are being pushed out of city centers into outlying suburbs. There have been various theories about how this is essentially the fulfillment of a decades-long response to the inner city uprisings and riots of the late 1960s with the ultimate goal being decentralization of potentially revolutionary populations. Regardless of the origins of this shift, we recently got a preview of what suburban uprisings look like in Ferguson — and how effectively militarized police are able to shut them down. As an organizer, how do you think this shift to the suburbs will affect the ability of local housing rights movements to grow, thrive and accomplish their goals?

I was born in Oakland but brought up mostly in Vallejo; I think that it is a mistake most of our organizations have made to not nurture progressive organizing in the blue-collar suburbs. It doesn’t mean that big-city organizers need to run and parachute in to Hayward, Vallejo and Fairfield and Concord. But we do need to create relationships with people already doing the work, mostly through church-based organizing.

The Contra Costa Interfaith Supporting Council has been doing fantastic work in areas far outside of “hip” areas. Last year, I observed the Participatory Budgeting process in Vallejo and I was impressed by what I saw. By giving a portion of the city budget over to a popular decision-making process, a lot of dialogue between citizens was created over the future of their city. Youth and non-citizens were welcomed and encouraged to participate. It wasn’t uncommon to see a resident of a Section 8 housing development work alongside a middle-class homeowner in a spirit of mutual respect.

When schools, parks, streetlights and other aspects of local infrastructure are improved, it makes neighborhoods more desirable — which makes displacement more likely. How can neighborhoods improve themselves without falling prey to this vicious cycle?

This is the million-dollar question, isn’t it? Because of this reality, many well-meaning people romanticize preserving dilapidated conditions as an anti-displacement strategy. This is simply wrong-headed. Disinvestment is simply the first phase of displacement, the time when speculators can scoop up property on the cheap and wait until the time is right to flip. One of the solutions is to engage in long-term community planning so that improvements such as these can be done in tandem with strategies to preserve affordability in a meaningful, not superficial way.

On a bigger scale, look at projects like BART. Clearly the development of a mass transit system played a key role in mass displacement in San Francisco. But for reasons of environmental sustainability as well as convenience, I think it would be hard to argue that the city would be better off without a rail system. As more cities improve their transit systems, what can low-income communities do so that they’re able to enjoy the benefits of improved transit options without succumbing to displacement?

When Portland put in its rail system a few years ago, it funded a Community Land Trust to work on preserving the impacted communities. The funding was never enough to make the desired impact, but the model was a strong one.

One of the possible solutions you mention in the book involves passing laws to curb property speculation by taxing away the profits. None of the ballot initiatives coming up for a vote in San Francisco next month go quite that far, but several do aim to alleviate the city’s displacement crisis. Are you hopeful that any of these will achieve that goal? If so, what solutions embedded within these initiatives give you the most hope?

Yes. Proposition G on San Francisco’s ballot is critical. It curbs displacement by discouraging the practice of swift flipping of buildings for windfall profits. Even though it will help protect renters, first-time homebuyers who actually want to make San Francisco home will be big winners if this passes. In the absence of political will on the state level to address the Ellis Act, this is the only hope to save what’s left of the San Francisco we fell in love with.

Another option for creating “gentrification-proof bubbles” that you mention is the establishment of Community Land Trusts. The interesting thing about this ownership structure is that it does so much more than just prevent evictions — they actually require that neighbors know each other and learn how to work together. This model feels like the polar opposite of the sole homeownership model of the 20th century in America, which promoted individuality and independence at the cost of community-building. Can you really ever see the CLT model taking off in America?

I helped form the San Francisco Community Land Trust and I believe that this model can simultaneously preserve affordability and build community. It’s basically a rebooted version of the old cooperative housing model where affordability and tenure is protected, much in the same way that forests are protected through trusts. Without forms of community ownership, even the most impressive housing organizing victories are temporary. It’s important not to romanticize the cooperative and deal head-on with the problems it presents. For example, the SFCLT has been incorporated since 2004 and we have secured about six dozen homes. Not enough to intervene in the housing crisis yet. Land trusts are part of the solution, not the entire thing. And yes, one of the main obstacles is the accepted notions of what people expect from their housing. It is hard to move beyond the poles of renter vs. homeowner. The CLT model makes asks of both society and the individual. It asks society to move toward housing as a human right. It asks individuals to take personal responsibility as part of a community. It is a heavy lift given the times we live in.

Liam O’Donoghue is Salon’s communications director. He writes about what’s happening at Salon and manages Salon’s social media assets. You can follow him on Twitter @Liam_Odonoghue.

http://www.salon.com/2014/11/02/don%E2%80%99t_call_it_gentrification/?source=newsletter

Leading tech investors warn of bubble risk ‘unprecedented since 1999′

Snapchat CEO Evan Spiegel
Snapchat CEO Evan Spiegel, whose company was valued at $10bn despite having never turned a profit. Photograph: Jae C. Hong/AP

Two of the world’s leading tech investors have warned the new wave of tech companies and their backers are taking on risk and burning through cash at rates unseen since 1999 when the “dotcom bubble” burst.

Bill Gurley, partner at Silicon Valley-based investor Benchmark, sounded the horn of doom on Monday warning that “Silicon Valley as a whole or that the venture-capital community or startup community is taking on an excessive amount of risk right now.”

In an interview with the Wall Street Journal Gurley, whose investments include OpenTable, Uber and Zillow, said startups were taking on risks in a way “unprecedented since ‘99”.

Gurley said that “more humans in Silicon Valley are working for money-losing companies than have been in 15 years”, and they’re burning through huge piles of cash.

“In 01 or 09, you just wouldn’t go take a job at a company that’s burning $4m a month. Today everyone does it without thinking,” he said.

His comments were backed up Tuesday by Fred Wilson, the New York-based co-founder of Union Square Ventures who has backed companies including Twitter, Tumblr and Zynga.

Burn rates – the amount of money a startup is spending – are “sky high all over the US startup sector right now”, he wrote in a blog post.

“We have multiple portfolio companies burning multiple millions of dollars a month. Thankfully its not our entire portfolio. But it is more than I’d like and more than I’m personally comfortable with,” he wrote.

“I’ve been grumpy for months, possibly for longer than that, about this. I’ve pushed back on long term leases that I thought were outrageous, I’ve pushed back on spending plans that I thought were too aggressive and too risky, I’ve made myself a pain in the ass to more than a few CEOs.”’

The comments come after a new generation of tech companies have attracted record levels of investments at levels that give the profitless businesses eye-watering valuations.

In August Snapchat, the social messaging service, was valued at $10bn after a new round of funding. The free service’s fans send 500m self-deleting messages a day, but Snapchat has yet to declare how it intends to make money. Among the other big tech valuations in recent months are Uber, the taxi app service, which was valued at $18bn after its last round of funding in June, and Airbnb, the short term rentals service, which was valued at $10bn in April.

But the valuations are not the immediate issue, according to the sceptical tech investors. “Valuations can be fixed. You can do a down round (investing at a lower valuation), or three or four flat ones, until you get the price right,” writes Wilson. “But burn rates are exactly that. Burning cash. Losing money. Emphasis on the losing.”

Asked if investors, and the people working for the companies, were distracted by the potential for reward, Gurley said: “Yeah, it’s a whole bunch of things. But you just slowly forget, and half of the entrepreneurs today, or maybe more – 60% or 70% – weren’t around in ‘99, so they have no muscle memory whatsoever.”

http://www.theguardian.com/technology/2014/sep/16/tech-bubble-warning-investors-dotcom-losing-money