One can appreciate the economic benefits that firms like Uber, Lyft, Salesforce, and others have brought to San Francisco and other tech-oriented cities. Yet the concentration of high-end businesses has also helped create a neo-Dickensian reality: sky-high housing prices, widespread homelessness, and a rapidly shrinking middle class. There are now more drug addicts in San Francisco than high school students. Rising rents have undermined that city’s cherished bohemian culture and hastened a rapid decline in the minority population, both in the city and across the tech-dominated Bay Area. In 1970, 96,000 African-Americans lived in San Francisco; today, barely 46,000 make their homes there, constituting less than 5 percent of the city’s population. More than half of the Bay Area’s lower-income communities, notes a recent UC Berkeley study, are in danger of mass displacement. Amazon, it seemed to many progressives, threatened to bring the same conditions to New York.
Tech-dominated metros, though ostensible bastions of progressive values, increasingly resemble, as Wired recently noted, a “caste” system dominated by oligarchs and their key employees—“feudalism with better marketing.” Many working- and middle-class people have been reduced to joining the swelling “precariat” of temporary workers, while some have even slipped into the ranks of the homeless. Once dominated by manufacturing employment, Seattle has been transformed by Amazon, which has created nearly all the 60,000 new jobs downtown since 2010. The new housing demand, imposed on a highly restricted real-estate market, has driven metropolitan house prices stratospherically higher. All the signature San Francisco problems—homelessness, disappearing families, wealth inequality—are now all too evident in the Emerald City. Seattle’s African-American population has stagnated as the city has boomed and is losing its hold even in its traditional neighborhoods.
Seattle’s rising socialist political class did not cheer the city’s transformation. They have demanded that Amazon and other tech giants pay to alleviate homelessness and housing shortages. But Amazon CEO Jeff Bezos, responsible for nearly 20 percent of the city’s office space, has the advantage of operating in America’s largest “company town.” When push came to shove, he could threaten to undermine the city’s entire economy in ways reminiscent of a mill-town company boss in the early industrial revolution.