A Rebuttal of Farhad Manjoo's Version of the Bay Area Tech Boom

Categories: Media, Tech

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By all measures, the opening anecdote of Farhad Manjoo's current San Francisco Magazine feature, "The Care and Feeding of a Tech Boom," seems magical.

It tells the story of Austen Allred, a 23-year-old Mormon entrepreneur who migrated to San Francisco from the hinterlands of Provo, Utah, to start an Internet company. Allred is both plain-spoken and aspirational, a kind of Everyman who, in many ways, embodies a tech boom version of the American dream. In Manjoo's dazzlingly crafted account, he's a globe-trotter, an ex-couch surfer, and a self-proclaimed minimalist who opted to live in his Honda Civic rather than pay exorbitant rents in San Francisco or on the Peninsula -- which ballooned, ironically, because so many of Allred's peers came to San Francisco to start Internet companies. Yet if Manjoo is trying to write a persuasive apologetic for this generation, he couldn't have picked a better character to illustrate it.

Fair enough. But here's the thing -- Allred isn't an Everyman. He's an outlier. He's someone with a fantastic individual narrative that in no way represents the rest of San Francisco's tech boom. After introducing this atypical story as typical, Manjoo uses it as a springboard for a series of unproven arguments which all depend upon each other. In effect, he's grafting an exceptional yarn onto a worldview. We've veered from the magical to mere magical thinking.

There's a reason writers start articles with stories like these: because they're so unusual. But once Manjoo veers into the usual, his arguments no longer seem as compelling. He launches the second section of the article by informing readers that average incomes in San Mateo County shot up from $81,000 to $168,480 between the end of 2011 and the end of 2012, a statistic meant to convince us that the entire county is reaping the spoils of innovation. In reality, though, average income is an easily manipulated marker. It tells you nothing about the distribution of the money.

For example: Elfin political economist Robert Reich is fond of saying that he and basketball player Shaquille O'Neal have an average height of six feet.

If anything, Manjoo's statistic shows that the very rich got a lot richer.

Manjoo's other prosperity indicators are equally murky. He writes that San Mateo's County coffers are flush, as evidenced by new housing shelters, a new fire station, a paydown of pension liabilities, and a new jail. Yet any cub reporter covering San Mateo well knows that the county is funding most current improvements with money generated from its new Measure A sales tax, which has little to do with the tech sector. San Mateo's pension system may indeed be healthy compared to counties so desperate that they'd offer Walter White a tax break to move there. But "health" is still a relative term for pension systems. In June, a civil grand jury dinged San Mateo for having a $2 billion pension shortfall and a funding strategy based on "hope."

The new jail in Redwood City is perhaps the worst barometer of progress that Manjoo could have chosen. Because county officials broke ground without securing money from the state, they now have to bankroll the project with money borrowed from revenue bonds, using the building as collateral. That means it could wind up costing twice as much as the projected $165 million. If anything, that's a regression. So is Manjoo's vision of self-driving Uber cars to supplant public transportation systems, which would put an entire cab industry out of business, and probably eliminate thousands of blue-collar jobs. A fleet of self-driving cars would fulfill the sci-fi fantasies of a few at the expense of the masses; Manjoo seems to have no concept of how less-than-affluent people get to work every day.

Then there's Palo Alto's recent vehicle-dwelling ban, which Manjoo characterizes as a fatwa against the Austen Allreds of the world -- he goes so far as to lump "temporary campers like Allred with the involuntary, chronically homeless." To assume that this law is a reaction to the tech boom, and not a calculated move to shunt Palo Alto's homeless over to East Palo Alto, is naïve at best. And again, it assumes that Allred, the bootstrapping entrepreneur, is the norm, rather than the exception. Manjoo believes that homeless people on the Peninsula are actually starting Internet companies.

In fact, so many specious arguments lard this tech treatise that its central points bear questioning. It's hard to take on faith Manjoo's belief that the tech boom will be permanent and sustainable when the building blocks of his argument tend to crumble. Moreover, it's hard to accept the premise that, by some alchemy, tech will transform industry and save all other sectors of the economy.

Manjoo isn't the first to voice such predictions. His predecessors believed the Internet would create a world without boundaries. Traditional infrastructure would collapse, they thought, once anyone could build a business from a bedroom.

Yet the story of Austen Allred contradicts -- and even debunks -- those theories. In a truly digital world, Allred wouldn't have to strike out west to start his Internet company; he'd be able to launch it from the temperate environs of Provo. He'd pay rent, live in a home, and not even have to think about displacing some San Francisco resident who's not a tech genius. That allegory of the starry-eyed innovator packing up his 2002 Honda Civic Ex Coupe wouldn't work, because geographic lines wouldn't matter.

And yet, they do matter, which means the original dot-commers fell well short of their vision. It makes you wonder what their successors are wrong about.



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6 comments
bassguitarhero
bassguitarhero

The reason the tech bubble in SF will burst is because of the same thing that caused it to burst the last time: Innovative people seek out challenges, money follows innovative people, and hacks follow money. 

When you put too much money in San Francisco, the city fills up with hacks chasing the easy money. But the rest of the world moves on. Talented people leave, craving new challenges, and the easy money leaves the city.

We had a few years of innovation. Facebook and Twitter were certainly unique. Lyft had a different idea. Then Uber, then Dashcar, then Sidecar, Pinterest, Swipp, etc etc etc. The tech boom has descended into, "Take someone else's idea, tweak one part, and try to pawn it off for millions." That's what happened in 2000, and it only lasts for so long, VC investors will only lose so much money, before they stop treating SF like a slot machine and move on. 

SF is and always has been a boom and bust city. Techies go on and on about "the market" as if they think that by hoping hard enough, they'll turn a bubble into something permanent. But it won't be, because the money ruins it every time.

tool
tool

You guys ran the wrong cover of the magazine. That's not the current issue. The one you featured is like a year old.


a9000
a9000

One emigrates from a place, and immigrates to a place. They're not interchangeable words.

a9000
a9000

One emigrates from a place, and immigrates to a place. They're not interchangeable words.


maxhostile
maxhostile

The most location-obsessed tribe is trying to convince you that location doesn't matter in every industry except their own.

mike1990
mike1990

"Of Mark Zuckerberg and I?" Fail.

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