
Silicon Valley's prosperity paradox: 76000 millionaires can't fix local poverty - e15ctr0n
http://www.businessinsider.com/silicon-valleys-prosperity-paradox-explained-2016-12
======
hprotagonist
>"The large rooms of which you are so proud are in fact your shame. They are
big enough to hold crowds--and also big enough to shut out the voices of the
poor....There is your sister or brother, naked, crying! And you stand confused
over the choice of an attractive floor covering."

Ambrose 4th Century

------
TheBeardKing
I understand the libertarian ideal of being free to choose how to give away
your own money, but how do they reconcile that with the ignorance of the elite
as to the social problems they never encounter? Even given the inefficiencies
of government, it's hard for me to imagine that the same amount of social
spending could do more good from the hands of individuals than collective
agencies.

~~~
compiler-guy
There are plenty of governments that miserably fail to distribute very large
amounts of aid in a way that actually helps the target groups [0] is one in
the US, and internationally, things can be really, really sketchy.

One advantage about doing it via charity is that if a charity is ineffective,
or fraudulent, switching to a new one is easy. Fixing a government full of
corruption or inefficiency is quite a bit harder.

Government does have an important role, but it is no panacea.

[0] [https://www.washingtonpost.com/opinions/how-newark-
schools-p...](https://www.washingtonpost.com/opinions/how-newark-schools-
partially-squandered-a-great-
prize/2015/10/20/ffff660c-7743-11e5-a958-d889faf561dc_story.html?utm_term=.eb85e0908ca4)

~~~
throawaybay
Umm.. you vote out the corruption?

~~~
nickff
This assumes that the elected officials are the problem, that better options
are available, and that the system will allow change.

------
jimmywanger
My friend serves on a local educational non-profit.

He's encountered a lot of problems during his tenure there, that explain why
they don't play nicely with many silicon valley folks.

First, the non-profit's goal is to continue to exist, and that means to
appease donors, not to serve the needs of the community.

Second, a lot of the employees are volunteers, which means they don't act
quite professionally sometimes and push their own agendas to the detriment to
the non-profit's overall goals.

Finally, and sadly enough, many of the volunteers lack professionalism. They
routinely disclose information they were asked not to reveal, and they forget
to document possible conflicts of interest

~~~
raverbashing
> volunteers

> professionalism

Pick one

Are those non-profits financed by local companies? Yes, it's usual that they
will try to solve their own problems, that's why you select good people and
give them a reason to thing about the bigger picture (that is, you pay them)

~~~
jimmywanger
> Pick one

Maybe I'm spoiled with who I've been working with, but even when you do
something for free, you still try to do a good job while you're at it.

For instance, if you're a landscaper, and you're doing a yard for a neighbor
for a favor, you still break out the edger to to the extra mile on what you're
doing.

------
kaycebasques
The "76000 millionaires" number might be a little misleading. I've lived in
Silicon Valley since I was 3. I bet that a lot of those millionaires are home
owners on the Peninsula who have nothing to do with "Silicon Valley" as we
commonly refer to it (the tech industry). My Grandpa, for example, was a high
school teacher all his life. He bought a home up in the Burlingame hills back
in the 60s or 70s, and that thing is probably worth multi-millions now.

~~~
freehunter
I honestly don't know, so I'm asking a genuine question: if someone has no
money in their bank account but owns a house worth millions of dollars, are
they considered a millionaire? Even though they've never realized that money
and could never spend that money?

Sorry, your comment just raised an interesting question in my mind.

~~~
tasuki
Well, they can still sell the house. Then they can spend the money.

~~~
user5994461
But they don't have a place to live anymore.

~~~
euyyn
Many people live in places without owning a $1M house.

------
stanfordkid
Silicon Valley and San Francisco need to learn from NYC about how to address
homelessness and and poverty. The state of the Tenderloin is comparable to
Times Square in the 1970s.

It boggles my mind why we cannot divert that valuable land towards productive
use and use the tax revenue generated towards providing homeless services
closer to the outer edges of the city and away from civil society.

I urge people to read this article: [http://www.city-journal.org/html/how-new-
york-became-safe-fu...](http://www.city-journal.org/html/how-new-york-became-
safe-full-story-13197.html)

~~~
jartelt
SF already spends ~$250M a year on homelessness. I don't think more money is
what is needed to solve the problem. I think a change in tactics is needed. I
am not sure what the right answer is, but they already have ~$25k to spend per
homeless person.

~~~
bb611
That ~$250M/year is spending on both homeless and homelessness prevention,
only about $100 million of that is actual services for the homeless, of whom
there are ~7000, so about $14,000/homeless person.

[http://sfist.com/2016/04/12/no_san_francisco_does_not_spend_...](http://sfist.com/2016/04/12/no_san_francisco_does_not_spend_360.php)

I think there's a strong argument for changing tactics, but if one of my
friends anywhere in the bay area told me they were living on $14,000/yr I
would ask if they have enough food, so it doesn't surprise me that this isn't
really working.

~~~
the_gastropod
I understand SF more expensive than NYC these days, but $14,000/year sounds
like a reasonable amount of money to me. It's obviously not enough for each
person to get their own apartment, but if spent wisely, it seems like it
should afford them some safe modest shelter and a reliable 3 meals per day.

I assume some of the money goes towards rehabilitation, which cuts into these
funds a bit. Maybe it does need to be bumped up. At first glance, $14k just
seems like it should do a better job than it's doing.

------
dmode
I have to admit, I have become a bit disillusioned with charity. After
contributing many hours with Glide church, serving homeless people in SF,
participating in many events and fundraising, I feel like we rarely move the
needle. Charity seems to be designed to just maintain the status quo. Last
month, I spent a week in a French village near Lyon and I was surprised to see
the quality of life in a small village in France - supposedly a socialist
country with stagnant economy and high unemployment. That made me wonder
whether persistent poverty is simply an outcome of a dynamic capitalist system
and the only way to address it is some form of socialism or universal basic
income.

~~~
legodt
Charity is most definitely a tool to reinforce the status quo. It's not that
charity is bad, but it is less good. Here is a fantastic article on the topic:
[https://www.jacobinmag.com/2015/08/peter-singer-charity-
effe...](https://www.jacobinmag.com/2015/08/peter-singer-charity-effective-
altruism/)

------
Kalium
I don't think "empathy gap" is a good way to describe the disconnect
described. The gap isn't a lack of empathy. Nobody involved lacks empathy.
It's a fundamental question of framing and measurements.

One group of people wants cares about how happy they make people and how moral
their mission is. The other cares about the efficiency of how many people can
be made that happy per unit of cash.

This is why CharityNavigator and similar have become popular.

------
stcredzero
Somewhere in my brain is floating the figure of 40,000 for the entire homeless
population of the entire greater Bay Area. There are twice as many
millionaires in Silicon Valley as there are homeless in a greatly expanded
"local area." There are about an order of magnitude more millionaires as there
are homeless in Silicon Valley proper.

[http://www.mercurynews.com/2015/06/22/silicon-valley-
homeles...](http://www.mercurynews.com/2015/06/22/silicon-valley-homelessness-
drops-to-its-lowest-level-in-a-decade/)

------
touny
Is this really a matter of donating? Shouldn't it be a matter of changing
economies? Donating helps but it also keeps the status quo, where wealthy
still have access to opportunities and the poorest still don't.

------
heisenbit
For trickle down to work the rich need to buy sufficient amount of services.
Unfortunately there is an oversupply of low skilled labor and thus not enough
of these jobs (how much can 76000 people consume) and no bargaining power.

The middle class as a broad wealth transmission belt has been shrinking and is
under pressure from low interest on retirement accounts, high educational cost
and home financing costs.

As the money is pumped into the economy from the banking/financial side the
gap is increasing continuously.

------
nickpsecurity
It's no mystery. 76000 millionaires who care about their own interests and
money instead of poverty aren't fixing local poverty. They could do a lot to
address causes and symptoms to point of a great transformation. They just
don't want to. End of story.

Now, knowing they don't want to or put in little effort, what's the next plan
for people wanting to end poverty over there that factors this in as a base
assumption?

~~~
Tempest1981
I really don't think it's about money or lack of empathy, as you imply. SV is
largely liberal -- witness climate change efforts. If there was a clear
solution, I suspect they would back it with their money.

~~~
nickpsecurity
There's a difference between liberal and willing to put much of one's fortune
into making others well off. They could be doing all kinds of investments,
lobbying, etc that would reduce poverty as a side-effect.

------
throw2016
The homeless problem is SF is so minuscle and the talent and funds available
so extensive that the only reasonable conclusion is there is no desire to fix
it. Contrast this with the hundreds of billions of dollars wasted by the
government on the severely bloated security state and trillions on the banks
bailout and one has to question the priorities and loyalties of the american
state. There is no lack of money, it seems a lack of will.

I think few other countries if any display nearly the same visceral hatred of
poor people or perpetuate a naive black white view of poverty as the US tends
to do.

This binary view leaves little room for adversity, bad luck or downturns with
commentators in an unholy rush to tar them all as criminals, addicts or
mentally unstable. It seems the expectation is the homeless should be at their
best behavior while in abject poverty.

Trying to 'help' these folks get back on their feet is 'unearned' and strikes
at the identity of individualized americans for whom a bare decent life is a
privilege to be earned. And resentment for 'freeloaders' reflexive and
immediate. You can't have 'winners' without losers.

The problem is the 'losers' are now in plain sight and making things
unpleasant for the winners, and the urgency is not to address their suffering
for they must suffer, but to dehumanize and get them out of sight so the
'winners' can carry on uninterrupted.

------
shostack
Could anyone else find where the stat came from on number of millionaires? I
opened the linked PDF report the link ultimately led to, read the whole thing
and couldn't find it.

I'm curious because the devil may be in the details and the headline may not
be what it sounds.

Specifically...

\- What form does this wealth take? Are they only paper rich? If so, they
probably can't access much of those funds. Same if they are tied up in
retirement accounts.

\- What is the distribution of money in this sample? If it is closer to $1M
for the majority vs much higher amounts, that isn't as much money as most
people think it is out here when a crappy small house in a decent neighborhood
costs more than that. Certainly not "divert your funds to solve poverty"
levels of cash. If you have $1M and have a decently large mortgage out here,
that money is likely not even enough to cover your retirement if you keep
living here.

This sort of headline and math drives impressions and revenue for Business
Insider but this is likely a non story.

Don't get me wrong... This is a big problem that we should absolutely be
trying to solve. But this seems to point the finger at a group of people who
may not really be worth pointing the finger at because they actually aren't
that wealthy in reality if you factor in the form of that wealth, cost of
living, mortgage, and saving for retirement. They may in fact look more
similar to the upper middle class of 20 years ago, albeit with smaller,
crappier homes.

~~~
sedachv
> They may in fact look more similar to the upper middle class of 20 years
> ago, albeit with smaller, crappier homes.

If the conjecture is true, it would be a really powerful example of how great
wealth inequality has gotten, and how absolutely ineffective trickle-down
economics is.

~~~
jwatte
Wealth inequality plus trickle up economics plus inflation makes for
millionaire wage slaves who can't afford their kids college tuition.

------
vonnik
If only we had an central organization that collected taxes to solve issues of
public concern.

------
h4nkoslo
Why would they want to "fix local poverty"? What does that even mean, writing
checks in perpetuity? Why would they want to give their resources to other
people? How culturally compatible are these "millionaires" with the people
they would supposedly be helping? What does a Chinese expat engineer have in
common with a schizophrenic black hobo that he would want to write them a
check, their presence in the same zip code? Why would he do so when he's
already taxed, heavily, to provide things like "homeless services" in SF to
the tune of $250 million / year (IE, approximately $20K / homeless person)
with apparently no effect? How much of a cut do these "nonprofits" take along
the way?

Lots of unasked questions here.

------
dvdhnt
Off topic: I noticed the article cited Zillow as a "real estate database".
That is troubling given how inaccurate the service has proven to be.

~~~
Naritai
An "inaccurate real estate database" is still a "real estate database".

------
dade_
It is easy to blame individuals, but let's face facts, everyone is busy
dealing with their own issues no matter how poor or rich. Further, wealthy
people aren't going to start shopping at second hand stores any sooner than
the impoverished are going to start shopping Louis Vuitton to learn how other
people live. Don't know, don't care. Besides government, we have these silly
associations called corporations that are both tiny and enormous. There are
tax incentives and brand awareness that all motivate them to get involved with
these issues. Further, they have armies of people and other resources.

To owners, board members and shareholders: Is your company engaged with local
community issues? Are employees and management encouraged and supported to do
so? Awareness campaigns?

For employees and contractors: Have you bothered to see what your company is
doing to assist with these programs? Have you signed up to learn more?
Volunteer or donate money?

My 2c: It sounds like a much better approach to work with than trying to chase
after 76000 individuals. More likely to herd cats.

Every year our local office adopts a family and donates household goods, food,
gifts, and computers. Last year we worked at the local food bank, the
community kitchen and last year repainted a community centre. It is a great
opportunity for team building that doesn't involve stupid posters with lions
and whales.

~~~
Tempest1981
Many in SV are busy, but are also aware and empathetic.

I suspect many of us would pay slightly higher taxes to solve this problem, if
that were possible. But we are less likely to invest time, or push
corporations to tackle the issue.

------
notacoward
Contra the article, the rich in Silicon Valley very much know those poorer
people exist. They're the maids, cooks, landscapers, restaurant workers, car
detailers, construction crews, etc. They're not invisible. They exist, just
not - to their clients or customers - as people. Replace them with robots, and
the millionaires will only notice a difference in cost or service levels. The
idea that somebody's livelihood just went _poof_ is of no consequence to them.

------
ohwello
The number of people in the area is greater than the number of homes. No
amount of income redistribution can possibly fix this. If you rent a room for
a homeless person, you are just going to price out the poorest person who can
currently afford a room. The only way to fix this is remove people or build
homes. The first option is better for the landed gentry, the second option is
better for the nation as a whole.

------
leurfete
Every time I read something like this I think about all my rich friends in
Silicon Valley who engage in armchair socialism. Gives me a good chuckle. ^.^

~~~
notacoward
As another responder pointed out, there's nothing inconsistent about it. Just
because someone believes _all_ of the rich should pay more doesn't mean
they're willing to be the _only_ ones doing so while their more callous peers
coast by.

You know what's inconsistent? Claiming to care about an issue, but opposing
any means of addressing it. If you're going to preclude the government
addressing poverty, you can't also go around undermining everyone else who
tries. For example, in other comments on this story I see people complaining
about volunteers' lack of professionalism, and about spending money on
marketing. Clue time: money for marketing is a necessity for _any_ long-term
enterprise. If the government got out of charity altogether, each charity
would have to try even harder to draw attention to their cause among all the
others. The marketing industry would love it, but from the standpoint of
helping the poor it's a form of inefficiency. Those who rail against
government inefficiency should admit and consider the inefficiency in their
own chosen model, lest they seem dishonest.

------
jimmywanger
From the article:

"For both sides to work together effectively, each has to recognize the
challenges of the other."

Why? In order for both sides to work together effectively, the business (non-
profit) has to anticipate and fulfill the need of the consumers (donors).

They're basically saying that not only aren't the donors giving enough, they
need to be educated into changing their reasons and motivations for giving.

------
jartelt
It seems like some of the charities need to spend money on marketing to get
their message out and attract/convince new donors. It's hard to raise money
and get donations if people do not know what you do. Unfortunately, many
people get angry when charities spend money on marketing because they say it's
wasteful and doesn't go directly to helping people. But, sometimes you have to
spend some money in order to make more money in order to help more people...

~~~
bb611
My sister has spent the last ~15 years in nonprofit management, she
consistently says that marketing and outreach are 30-40% of the budget at the
nonprofits she works with, many of which have annual donations in the 8
figures.

Socially it's really unacceptable to say "we spent $3 million on marketing
this year" because people think you should have spent it helping people, but
if you don't spend it this year your doors close next year.

------
elevensies
If large numbers of poor people choose to live in silicon valley, that implies
silicon valley is actually one of the best places for the poor.

~~~
cm2012
They vast majority of poor in SF grew up there or in nearby areas, they didn't
migrate there like the economic elite have.

~~~
1_2__3
We're talking homeless, not simply poor, and I'd love to see some citations.

~~~
bb611
70% of SF homeless from SF:
[http://sfmayor.org/sites/default/files/FileCenter/Documents/...](http://sfmayor.org/sites/default/files/FileCenter/Documents/455-SanFrancisco_HomelessReport_2015_FINAL.PDF)

Page 33, under the subtitle "Place of Residence"

~~~
ohwello
I don't see any data about where people are from in that link. Just where they
lived most recently. A good way to become homeless is to move into an unstable
housing situation in a far away place with high rents.

~~~
bb611
"Seventy-one percent (71%) of respondents reported they were living in San
Francisco at the time they most recently became homeless, an increase from 61%
in 2013."

It's true, it doesn't measure length of stay, but they came from SF and
claiming it's still an external problem with no evidence seems particularly
disingenuous.

~~~
ohwello
The original statement "They vast majority of poor in SF grew up there or in
nearby areas, they didn't migrate there like the economic elite have." is
simply not supported by this evidence.

Given historical population growth of California, I think it's not a winning
argument. Very few of California's residents have moral ground to live here at
the exclusion of others. Pretty much everyone moved here. The only way forward
is to allow enough homes to be built for everyone who wants to live here.

------
nice_byte
"can't fix" implies they're trying

------
riazrizvi
How about 760,000 millionaires? If we are going to invent a random statistic
without any data to back it up. Pretty document by the way.

------
slyrus
You misspelled won't.

------
grzm
You'll likely get downvoted for mentioning you expect downvotes. Please don't
do this. It adds nothing to the conversation.

~~~
js8
If you downvote somebody for mentioning downvotes in otherwise acceptable
comment, you are a fool; please don't do this. Mentioning downvoting adds
nothing to the conversation, but it also doesn't subtract anything.

(For the record, I think downvoting is a bad idea in general. Although GP
kinda deserves it, because his comment is empirically untrue, as other comment
stated.)

~~~
grzm
_" [mentioning downvoting] doesn't subtract anything"_

I disagree. It sets up the commenter as a martyr, and indicates they are
commenting from an adversarial position. Thinking this, they're less likely to
take the time to phrase their comment in a way that will invite further
constructive discussion. It also encourages an "us versus them" mentality.

People respond reflexively to phrasing. It takes extra effort to reflect and
respond well. Taking care to limit language that short-circuits reflection is
important to constructive, positive discussion.

~~~
js8
"I disagree. It sets up the commenter as a martyr, and indicates they are
commenting from an adversarial position."

But why should I, as a responder or moderator, care?

Imagine a comment with 10 statements, 9 are great points but 10th is logical
fallacy (in our case, appeal to emotion). Should such comment be downvoted? I
think NO, because each comment should be evaluated based on its merits, not
its flaws.

"Taking care to limit language that short-circuits reflection is important to
constructive, positive discussion."

If you, in the above example, just downvote without commenting, how can the
author figure out what he did wrong? It's like a punishment without an
explanation - a stupid, medieval idea.

~~~
grzm
I think we may be talking past each other. I understand you believe downvoting
in general is a bad idea, in particular downvoting without also providing an
explanation. Further, I think it's likely that you'd rather there be little or
no downvoting at all, with all interaction happening via comments. That's a
viewpoint I've heard others espouse as well, and that's a discussion that
interests me, though not one I'm interested in having right now.

In my initial comment, I've only described the voting behavior of some HN
members, not expressed any opinion on it, in the hopes that the author can
take that into account when commenting in the future. Separate from voting
behavior, the HN guidelines specifically call out mentioning downvoting:

 _Please resist commenting about being downvoted. It never does any good, and
it makes boring reading.

Please don't bait other users by inviting them to downvote you or proclaim
that you expect to get downvoted._

[https://news.ycombinator.com/newsguidelines.html](https://news.ycombinator.com/newsguidelines.html)

My second comment is specifically in response to your assertion that
mentioning downvoting is not detrimental to the conversation. You've continued
to discuss downvoting mentioning downvoting, while apparently missing that
I've been doing exactly as you recommend: commenting explicitly on what I
believe the commenter has done wrong.

Thank you for sharing more of your thoughts on whether to downvote and how you
think comments should be evaluated. I'm purposely not addressing them as
that's too large a discussion which will go too far afield (even more so than
this has already gone), and as I mentioned above, not one I'm willing to have
right now.

~~~
js8
> I think we may be talking past each other.

Ah OK, I understand. I actually agree that mentioning downvoting matters for
the reader (it's an irrelevant thing that takes away his time), but I don't
think it should matter for people who choose to participate, either by
replying or moderation.

I also agree with the HN guidelines that you quoted, although of course
without downvoting those wouldn't be neccessary.

> I've been doing exactly as you recommend

I appreciate that.

> I'm purposely not addressing them as that's too large a discussion which
> will go too far afield

That's fine, I agree it's offtopic. Unfortunately, HN doesn't seem to provide
good forum for these matters. Even in general I think this is a hard to solve
problem, how to avoid discussions to turn into irrelevancy, which can be given
by fleeting nature of these discussions.

I am thinking, maybe someone in the future will apply some NLP learning to
automatically mark threads that become offtopic (and collapses them or moves
them elsewhere); that could perhaps solve the problem for reader that
downvoting intends to solve.

------
hash-set
Crikey, speak the truth on here, get a downvote. Like clockwork!

~~~
pmyteh
Because it's an unsubtle polemic that misses its target. All government
inefficient? Check. And wrong. Charity as the single solution to collective
action problems? Check. And has substantial real-world limits due to the free-
rider problem. Medicare inefficient? Check. And ludicrously wrong.

Dropping a standard-issue screed into a thread tends to attract downvotes
because it isn't serious.

~~~
exstudent2
> All government inefficient? Check. And wrong.

Can you name an efficient government program?

~~~
jartelt
Medicare is pretty efficient and a lot of people on the program like it.

------
gerby
Been working on this problem for awhile. We're currently in Alpha. Not saying
a word about how we're fixing the problem on a public board, because peoples
envy and jealousy leads to violence (imitative competition) Girard would
postulate.

All I'll say, is it's _really good_ and _Gamified_ and will _emancipate human
people from suffering_.

------
maerF0x0
Article chooses the slant that its a bad thing that there is disparity. One
could claim that in a true dystopia the rich would just make it so
insufferable that the poor leave as economic refugees.

While I would love for everyone to be "rich" today, it seems that eventual
wealth is a good deal, if kind of harsh emotionally. Many of the "poor" (i
know there are extreme cases) are richer than kings 1000 yrs ago. I would
guess that in 1000 yrs the "poor" of then will be richer than our 1% today.

~~~
nkrisc
The "poor" you know are richer than kings of 1000 years ago? Well sure if
you're measuring in dollars they are. Otherwise, what on Earth are you talking
about?

~~~
ajss
Modern medicine, access to all the world's knowledge on a handheld device in
your pocket, cheap clean/safe water and food from every corner of the world,
entertainment (music/films/tv/youtube) cheap/safe transport over thousands of
miles in a matter of hours.

There's not a chance in hell I'd want to swap places with a king of 1000 years
ago.

~~~
nkrisc
You're just listing improvements to standards of living (that not all poor
benefit from even today). Ancient kings still controlled land, armies, and
food (they probably ate first in times of scarcity). They didn't have modern
conveniences but they were still wealthier that today's poor. They also had
power and most likely answered to no one.

