
Why one of America’s richest states is also its poorest - prostoalex
https://www.economist.com/united-states/2018/10/27/why-one-of-americas-richest-states-is-also-its-poorest
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chaostheory
The problem is a lack of inventory. When you have limited supply and a ton of
demand, that's how you get high prices. Why is there a lack of housing? While
Prop 13 is an issue, imo it's not the core problem.

This is the problem: _" High rents reflect the success of California’s
businesses—but also decades of low investment and over-regulation. The
California Environmental Quality Act, passed in 1970, aimed to ensure that
environmental concerns got a proper hearing in planning and development. In
practice, the act has become a NIMBYs’ charter. Four-fifths of all suits filed
under it have sought to stop infill development in cities (ie, on land already
zoned for building) even though this usually has a smaller environmental
impact than building on green fields. California’s development and impact fees
are about three times higher than the national average. Zoning laws and
parking requirements are onerous, too."_

SF isn't even the worst offender compared to cities like Belmont and Palo
Alto. While there are real safety concerns that limit development since 1.
we're in earthquake country, and also because of 2. some Superfund sites in
parts of the Bay Area; most of the problems just stem from current homeowners
of single family homes (NIMBYs), who do not want high-density housing near
their house. Until this changes, no reasonable amount of income assistance
will solve this problem for the poor or the middle class. There's just too
little usable land here to be exclusively used for traditional single-family
homes.

This has more detail about the problem in SF:
[https://www.sfchronicle.com/politics/article/How-powerful-
is...](https://www.sfchronicle.com/politics/article/How-powerful-is-Bay-Area-
s-pro-housing-13352047.php)

~~~
hopefulengineer
Why doesn't the government just use eminent domain to buy out some Nimby's in
crucial areas and build some high rise apartments? The housing issue is 100%
supply and demand. If I could wave a magic wand and create 1,000,000
apartments in SF rent prices would drop.

I'm assuming there's political pressure from wealthy land lords who don't want
their cash cow slain?

~~~
prolikewh0a
They wouldn't build 1 million apartments, for one, Apartments would likely be
built at a slower rate than people moving there. Two, as seen in Seattle, only
housing for the already wealthy is built. There is tons of demand for low
income housing, but no supply because it doesn't make as much profit (if any)
so there's no incentive for capitalists to house low income people and the
cycle keeps going.

Before I moved into my current place, I was in low income HUD subsidized
housing. It was a brand new building with rent control. Rent control worked
great, but the owners didn't keep their side of the promise. Maintenance took
months, all amenities we paid for were broken, access to the garage to store
our vehicles was broken for 4+ months, elevators were broken for months at a
time.

There is no way to get people to freely build affordable housing in or around
larger cities under this current system.

~~~
amluto
I don’t really buy this. If you build enough market-rate housing to satisfy
demand, then the price of older, less nice, formerly for-the-wealthy housing
stock will become considerably less expensive.

~~~
chrisdhoover
You can see it in the used car market. Low income folks drive around in very
old Lexuses. Smart move.

~~~
amluto
I used to drive around in an old ‘91 Lexus LS400. It was a fantastic car. I
still see that generation of LS400 on the roads :)

------
alecco
California has fast growing tent cities. Even if you live in a gated community
it's a pressure cooker that will get to you. On a blue state.

And instead of stepping back and analyzing what's causing this disaster they
double down on their existing agendas.

~~~
mpclark
On a related point, I visited Sunnyvale from the UK last week and was
surprised to see legions of battered RVs parked on the backstreets in the
area. What's going on there? Is it workers who can't afford to rent in the
area?

~~~
bvxvbxbxb
Read the news articles on the subject. There's a vast number of gainfully-
employed people whom don't wish to fritter their relatively meager earnings
away on techie-inflated rent. Most people in the area cannot legitimately
afford to live there as they would be spending more than a sensible amount on
housing because they can't ever hope to earn enough to be considered middle-
class. Still, the area needs janitors, cooks, teachers, bus drivers, human
resources and more non-techies whom rarely make much in a normal American
city. Instead, they make some sacrifices to keep more of what they earn and
opt-out of following the other lemming off the cliff into perpetual debt
peonage.

------
DoreenMichele
California currently has about 25% of America's homeless.

Some additional stats on homelessness and California:

[https://streetlifesolutions.blogspot.com/2018/05/california-...](https://streetlifesolutions.blogspot.com/2018/05/california-
statistics-on-homelessness.html)

~~~
chaostheory
imo chronic homelessness is a separate problem that mainly involves the lack
of funding for mental health institutions at a federal level. If I remember
correctly, 80% of homeless people are no longer homeless after 6 months. The
remaining 20% either suffer from mental health issues, drugs, or both. It's a
federal problem since all the states just want to play hot potato with the
chronically homeless, instead of actually trying to solve it

[https://www.theguardian.com/us-news/ng-
interactive/2017/dec/...](https://www.theguardian.com/us-news/ng-
interactive/2017/dec/20/bussed-out-america-moves-homeless-people-country-
study)

~~~
DoreenMichele
And this explains the California statistics how? California just churns out
ridiculous numbers of crazy people? Is that the suggestion?

~~~
lotsofpulp
I would think California attracts homeless from outside of California at least
due to the temperate weather.

~~~
DoreenMichele
I've suggested that myself. It's a factor I'm familiar with.

I have zero reason to believe that this fully accounts for one of the 50
states being home to one out of every four homeless Americans.

~~~
scottlamb
> I have zero reason to believe that this fully accounts for one of the 50
> states being home to one out of every four homeless Americans.

"One of 50 states" is a misleading statistic, given that states are nowhere
near equal in population and California is the largest.

California is home to one out of every eight Americans, has good weather, and
has some cities with an infamously high cost of housing. What fraction of the
homeless population would you expect it to have?

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bvxvbxbxb
There's homeless people living on the sides of highway on-ramps in the Bay
Area. 30 years ago, this wasn't a thing, but it's gone too far: not that the
people need to be busted up and bus-ticketed elsewhere, but rather civil
society has broken down and failed to provide for people.

~~~
stevenwoo
In San Diego last year I saw evidence of habitation in most downtown ramps
where there was shade, no matter the ambient noise level. Friends who moved
away from the Bay Area only 10 years ago came back and were shocked at the
homeless encampments off of 101 in south San Jose.

------
Gregory_Vines
No mosquitoes, no snow, little rain, constant 60-70 degree weather.

Homeless is easier in California. I imagine a lot of New York homeless people
die in the winter. Not true in a place like LA.

There's definitely a selection effect completely separate from any
political/economic factors (though of course those have an effect too).

------
drobert
I guess London has a similar problem but not this serious.

Living Wage Foundation calculates yearly the living wage for London and there
are around 4k companies that pay it voluntarily.

Maybe a similar solution would be useful.

I'm struggling to understand why the these people living below the poverty
line don't just move to a place where rent doesn't eat all their salary. They
must be trapped in one way or another.

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JDiculous
I'm glad to see all this attention being given to this absurd housing crisis
and everyone can agree that a huge part of the problems comes down to
NIMBYism, but is anything being done about it? Or are we just going to
continue having the same conversation over and over again.

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jefurii
This reads like anti-Prop-10 propaganda piece.

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romwell
TL;DR: because rent.

What a surprise: in a state where working full-time for minimum wage doesn't
even cover rent for a 1b apartment in the suburbs of one of its largest metro
areas, there are a lot of people who struggle.

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bsvalley
Is it me or the article linked presents zero relevant content?

~~~
DoreenMichele
_This is why poor people are coming en masse to california._

California exports poor people and imports rich ones.

[https://www.sacbee.com/news/state/california/article13647809...](https://www.sacbee.com/news/state/california/article136478098.html)

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NTDF9
Prop 13, Prop 13, Prop 13!

American economic woes are solely a consequence of enormous debts and
unwillingness to let prices go down.

We are precariously similar to Japan in 1989

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coldtea
Don't worry, free trade will short all of this out for the best, if only they
make it even freer. Some tax cuts for big businesses will help too.

Sure, a lot of those people might be dead by then, but who keeps score when
you're in the 10% that has no problem whatsoever?

