The Bay Area’s tech boom in historical and social context
The principal issue, full stop, in the Bay Area and most of California is housing.<p>There are two solutions to this:<p>1) Build more. But this is outrageously difficult due to a well-meaning political view of safety &#x2F; fairness &#x2F; etc. These restrictions employ an awful lot of bureaucrats for enforcement but add $10s of thousands in fees and delays for builders, that are IRR driven and would rather concentrate their efforts in more favorable markets (1)<p>2) Prop 13. For those unfamiliar this essentially locks in property taxes at the owner&#x27;s basis (with a maximum 2% adjustment for inflation). Meaning if in Silicon Valley you bought a house for $250,000 in the 1990s that&#x27;s now worth $2,000,000 you&#x27;re paying about $3,000 a year on taxes instead of $30,000 a year in taxes your next door neighbor is paying that just bought in. Oh and if you sell your house, and then buy a new house that&#x27;s less than you sold your old house for, you get to transfer the low tax basis! This was put into law due to the &quot;sentiment that older Californians should not be priced out of their homes through high taxes&quot; which I think is noble, but it&#x27;s also not realistic or fair. In many Bay Area neighborhoods you have a bizarre composition of young families hanging by their fingernails to pay for these &quot;entitlements&quot; for the retirees, and then the retirees that have a gigantic financial incentive to stay put which minimizes inventory and inflates home prices.<p>- - - -<p>1 - <a href="http:&#x2F;&#x2F;www.lao.ca.gov&#x2F;reports&#x2F;2015&#x2F;finance&#x2F;housing-costs&#x2F;housing-costs.aspx" rel="nofollow">http:&#x2F;&#x2F;www.lao.ca.gov&#x2F;reports&#x2F;2015&#x2F;finance&#x2F;housing-costs&#x2F;hou...</a><p>2 - <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;California_Proposition_13_(1978)" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;California_Proposition_13_(197...</a>