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Comment by ChrisNorstrom | Hacker News Reader

Fun Conspiracy Theory:

New York elite are conspiring to move Silicon Valley companies and talent to New York by running these pieces right around the same time that MASSIVE New York Tax Cut incentive (no income, no property, no state taxes for 10 years) for Tech companies was announced. There's been increasing criticism of Tech and the Bay Area so much so that it would make you think SF/SV is a bad place for startups and doesn't welcome them. It started about 2 weeks before the big tax cut incentive and is probably going to increase.

And it's working, an HN member below stated, "I live in NYC, and I often wonder what Silicon Valley is really like. Most of the news I read oh HN regarding it is very negative and cynical".

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One would hope that two side effects of this plot would be

1) Increasing wages in SV to attract and retain talent.

2) Medium-to-large-scale exodus of impressionable folks, reducing pressure on apartment rentals and bringing the rental market back to within screaming distance of sane prices.

Regarding 1) That's an effect of the market. If the talent can't afford to live and work in the valley, they won't. Generally speaking though, that's not who's affected by low wages, it's usually the non-talent, or, to put it as delicately as I'm able, the lower-skilled positions.

In short, it's the engineers and designers making it expensive for the janitors, waitresses and security guards that serve them.

As for 2, that could be fixed easily if San Francisco eased up on housing regulations and allowed for more building in the area.

Yes. As the economist Assar Lindbeck once said, "next to bombing, rent control seems in many cases to be the most efficient technique so far known for destroying cities".

Rent control is what allows anyone who's not in finance to live in SF. Look at the price of a condo to get an idea of what city-wide unregulated rents would be like.

The thing that's eating SF from the inside out is the dire lack of new apartments. Build enough and the city will approach affordable for the average worker.

(Sorry for the huge delay in posting. HN has been unusually flaky at my site.)

Sorry for the super-long delay in replying, HN has been particularly flaky at my site.

> If the talent can't afford to live and work in the valley, they won't.

One way to make it affordable for talent to live and work in an area is to increase their wages. There is a point at which Google et. al. would stop increasing wages and just move out of the area, but I strongly suspect that we're very far from that point. Moreover, I was talking about SV businesses increasing wages in SV in order to prevent people from moving out to NYC, or cause folks from elsewhere to choose SV over NYC.

> In short, it's the engineers and designers making it expensive...

Yes and no. An influx of people with a high earning potential into an area with a fixed number of apartments for rent does raise rents. Those rents would be lowered if the city (as a whole) would permit enough housing to be built quickly enough to accommodate the influx of workers.

I totally agree that the best way to bring rental rates back into shouting distance of sanity is to embark on massive build projects. If you look at my comment history, you'll see that I strongly support this sort of thing. I'm just not foolish enough to believe that that sort of project is likely to get started anytime soon. Sure, we've been hearing rumblings from the Mayor's Office. I seriously doubt that any project of his will make a substantial dent in the housing shortage.

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