Silicon Chasm
The class divide on America�s cutting edge
Charlotte Allen
December 2, 2013, Vol. 19, No. 12

Atherton, Calif.
"If you live here, you�ve made it,� David Berkey said to me as I rode shotgun in his car two months ago through the Silicon Valley�s wealth belt. The massive house toward which he was pointing belongs to Sergey Brin, cofounder of Google. With a net worth of $24 billion, Brin is Silicon Valley�s third-richest denizen and the fourteenth-richest man in America, according to Forbes. Berkey was chauffeuring me down Atherton Avenue, a wide, straight, completely tree-lined boulevard nicely bifurcating the city of Atherton (population 7,200), located 29 miles south of San Francisco, boasting no commercial real estate, and with a zip code (94027) that was recently listed by Forbes as America�s most expensive.

You couldn�t really see Brin�s house from the car, though�just a swatch of rooftop, maybe a chimney�because the point of the trees lining Atherton Avenue and nearly every other street in Atherton is to hide the dwellings behind them. Where the screens of trees happen to thin, property owners have constructed high hedges, high wooden fences, and high brick walls, so that when you look down Atherton Avenue from the Santa Cruz Mountains to the west toward the commuter railroad station to the east, you see only the all�e of trees�pine, palms, eucalyptus, sycamore, and juniper�shades of gray-green and brown-green shimmering placidly in the early autumn sun. �This is the Champs-�lys�es of Atherton,� Berkey explained. The other thing we didn�t see from Berkey�s car is people, except for the occasional driver on the road.

Turning corners, we drove past other fancy and half-hidden real estate owned by other Silicon Valley grandees; Sheryl Sandberg, the COO of Facebook, and her husband David Goldberg, the CEO of SurveyMonkey, have a 7,200-square-foot house somewhere in the hedge maze. Before there was such a thing as Silicon Valley�that is to say, 40 years ago�Atherton was an affluent bedroom town for white-shoe law-firm partners and Old Economy executives who liked to ride the Southern Pacific Peninsula to their jobs in San Francisco, imitating their East Coast counterparts who rolled on the Hartford-New Haven line from the Southern Connecticut Gold Coast into Manhattan. That was before today�s hiding-the-house custom, and the executives� front lawns surged out like green carpets to Atherton Avenue and its side streets. Now, Atherton is mostly teardowns and brand new mega-mansions�or at least as mega as their owners can get away with, given Atherton�s highly restrictive zoning laws that mandate enormous lot-to-footprint ratios. To increase their overall square footage, Atherton�s new breed of homeowners typically tunnel out vast underground extra space�wine cellars and home theaters�beneath their dwellings. The dominant style these days is a fanciful mix of Palladian Neoclassic, Loire Valley ch�teau, and Mediterranean villa, spreading out manor-house-style to cover as much ground as the zoning laws allow.

�This was a vacant lot five years ago,� said Berkey as we cruised by one of the spanking new stone-faced Atherton domiciles with its multiple dormers, chimneys, tile-roofed turrets, and columned porticos. �Now it�s worth $5 or $6 million. And this house here�it recently sold for $7 million, $4.4 million more than the asking price.� We passed the Menlo School, tuition $38,000 a year, where the parents pick up their kids in Range Rovers and fly them in private jets to exotic foreign locations for birthday parties. Down the road lay the Sacred Heart School, the Menlo School�s Catholic opposite number, where the tuition is only $34,000 a year. Their feeder is Atherton�s Las Lomitas School, rated among the top elementary schools in the state of California.

Las Lomitas is technically a public school, although its main support comes from a lavish parent-funded foundation that last year alone raised $2.8 million. �It�s going for $3 million this year,� Berkey said. �For the parents, it�s an attractive tax write-off. We can do good and feel good at the same time, because it benefits our own children.� Also not to be missed was the Menlo Circus Club (initiation fee: $250,000), featuring daily tennis, Friday polo matches, and state-of-the-art stables for horse people who can�t afford or don�t want to be bothered with the ranch-size spreads of owners who stable their own horses, farther up into the foothills of the Santa Cruz Mountains.

Berkey himself doesn�t live in Atherton. He can�t afford to. He�s a research fellow at Stanford�s Hoover Institution, and his wife, Eleanor Lacey, is general counsel at SurveyMonkey, which occupies Facebook�s old startup quarters in downtown Palo Alto. That makes them part of what is known as the �middle class� of Silicon Valley: two-career couples with family incomes in the low-to-mid six-figure-range. They and their two daughters live in neighboring Menlo Park, in what is essentially a modest 1950s tract house, the kind of flat-roofed, three-bedroom, two-bath, sliding-glass-patio-door, under-2,000-square-foot residences, pleasant but not pretentious, that were built en masse well into the 1970s as cheap starter homes, because back then it was conceivable that there could be such a thing as a cheap starter home in the valley. Berkey says his own house is currently valued at $1.2 million.

That�s par for the course. Open on any random day the Daily Post, the throwaway newspaper serving the mid-peninsula, and there will be a full-page ad for a �charming updated contemporary home� in Menlo Park or Palo Alto or Mountain View or Sunnyvale, with its single story, its gravel-topped roof, its living-room picture window, its teensy garden strip running alongside the jutting two-car garage that plugs into the kitchen, its pocket-size but grassy front lawn reminiscent of The Wonder Years�and its 1,216 square feet of living space�all �offered at $949,000.� That�s a bargain for the valley.

Berkey drove us out of Atherton, across El Camino Real, the peninsula�s main commercial highway, and across the railroad tracks past the tiny Atherton station, now part of California�s state-run Caltrain system and a commuter stop only on weekends. We were now in the featureless, nearly treeless, semi-industrial flatlands of Menlo Park stretching eastward to the bay. The demographic change was instant: �No se habla ingl�s! There were suddenly plenty of people on the sidewalks�and nearly every single one of them was Latino. There were suddenly plenty of commercial establishments�ramshackle, brightly painted, graffiti-adorned storefronts with hand-painted business signs mostly in Spanish: �Comida Nicaraguense,� �Restaurante Guatemalteco,� �Carnicer�a� (pork chops and steaks crudely painted on the walls), �Pescader�a� (fish and crustaceans crudely painted on the walls), �Panader�a,� �Check Cashing,� �Gonzalez Auto Sales,� �Sanchez Jewelry,� �Check Cashing,� �Arturo�s Shoe Repair,� �99� and Over,� �Check Cashing.�

Menlo Park is actually only about 20 percent Hispanic and is unabashedly affluent in its own right, but its Hispanic population concentrated next door to the hedgy scrim of Atherton makes for a startling study in contrasts. No one pretends that the gravel-roofed, shack-size houses in this particular neighborhood are �charming� midcentury modern gems. That would be hard to do, what with the weeds, the peeling paint, the chain-link fences, the chained-up guard dogs, and the front lawns paved over to accommodate multiple vehicles for multiple dwellers. The phrase �the other side of the tracks� has vivid meaning. �Look at the newspaper police blotters, and you�ll see that in Atherton the main reported crime is identity theft,� said Berkey. �Here, it�s break-ins.�

You can laud this underbelly barrio as vibrant immigrant culture or you can decry it as an instant-slum product of untrammeled illegal border-crossing, but it represents an important fact on the ground: These are the people who earn their livings tending to the needs of the high-tech �creative class� that has made Silicon Valley famous. I could see them on Atherton Avenue, the amanuensis class heading up from Menlo Park in their wee panel trucks and Dodge minivans and their Ford flatbeds fitted out with racks for garden tools among the Bentleys, BMWs, Audis, and Lexuses that are the standard Atherton vehicles. They tend the meticulously clipped lawns, flower beds, hedges, and trees of Atherton (Berkey said that it�s not uncommon for an Atherton sentence to begin, �My arborist .  .  . �). They clean the houses and the swimming pools, they deliver the catering, they watch the children, and they repair the roofs, the plumbing, the balconies, and the wine cellars of the very affluent and the very busy. You might say that across-the-tracks Menlo Park, along with down-market Latino neighborhoods just like it up and down the peninsula�East Palo Alto, parts of Redwood City, the southern end of San Jose�functions as a kind of oversize servants� wing. It�s safe to say that almost every hotel maid, restaurant busboy, cashier, janitor, retail stocker, and fast-food worker in the valley is Latino.

Master and servant. Cornucopian wealth for a few tech oligarchs plus relatively steady but relatively low-paying work for their lucky retainers. No middle class, unless the top 5 percent U.S. income bracket counts as middle class. Silicon Valley is a tableau vivant of what many economists and professional futurologists say is the coming fate of America itself, a fate to which Americans, if they can�t embrace it as some futurologists hope, should at least resign themselves.

While I was driving with Berkey around Atherton, Tyler Cowen, economics professor at George Mason University and author of The Great Stagnation (2011), published a new book, Average Is Over: Powering America Beyond the Age of the Great Stagnation. There, Cowen bluntly predicted what he called �wage polarization.� The increasing ability of computers to perform ordinary tasks will inexorably transform America into an income oligarchy in which the top 15 percent of people�with skills �that are a complement to the computer��will enjoy �cheery� labor-market prospects and soaring incomes, while the bottom 85 percent, that is to say, 267 million out of America�s 315 million people, will be lucky to find Walmart-level jobs or scrape together marginal �freelance� livings running $25-a-pop errands for their betters via TaskRabbit (say, picking up and delivering a pair of designer shoes from Nordstrom) or renting out their spare bedrooms (if they have any) to overnight lodgers via Airbnb. That is, if they�ll be working at all. �There are many other historical periods, including medieval times, where inequality is high, upward mobility is fairly low, and the social order is fairly stable, even if we as moderns find some aspects of that order objectionable,� Cowen writes in his new book.

In other words, what is coming is the �new feudalism,� a phrase coined by Chapman University urban studies professor Joel Kotkin, a prolific media presence whose New Geography website is an outlet for the trend�s most vocal critics. �It�s a weird Upstairs, Downstairs world in which there�s the gentry, and the role for everybody else is to be their servants,� Kotkin said in a telephone interview. �The agenda of the gentry is to force the working class to live in apartments for the rest of their lives and be serfs. But there�s a weird cognitive dissonance. Everyone who says people ought to be living in apartments actually lives in gigantic houses or has multiple houses.�

It�s hard to travel anywhere in the valley and not see what Kotkin is talking about. I took a walk on the Stanford campus, which occupies more than 8,000 acres, including a golf course, rustic Santa Cruz Mountain foothills, and an artificial lake, all bordering Atherton-Menlo Park. Stanford�s most photogenic structure is its historic Main Quad, a handsome sandstone-colonnaded, red tile-roofed exemplar of early 20th-century California Mission Revival architecture built soon after Stanford opened its doors in 1885. The Main Quad is the Stanford of illusion-based public relations, in place for camera-clicking tourists and prospective students, hordes of whom crowded the quad�s palm-decorated courtyard during my visit, and also for sentimental alumni in fundraising material. The real Stanford is a second quad, the 20-year-old and ever-expanding Science and Engineering Quad, whose massive, corporate-headquarters-looking buildings dwarf the original quad in bulk and classroom space. And also in academic significance: Computer science is Stanford�s most popular major. Only 15 percent of Stanford undergraduates major in the humanities these days, according to a recent article in the New York Times. During the 1950s and 1960s, by contrast, the most popular undergraduate major at Stanford was history.

Beyond the Science and Engineering Quad lies Sand Hill Road, Stanford�s northern and western boundary. And on the other side of Sand Hill, strategically sited close to Interstate 280, a pristine and scenic freeway that runs along the foothills to San Francisco, are the offices of the venture capitalists on whose investor money the Silicon Valley�s tech-empire has been built. The VC guys, well-known names such as Marc Andreessen of Andreessen Horowitz and John Doerr of Kleiner Perkins Caufield & Byers, controlling about one-third of America�s venture funds, their offices conveniently close to their estates in Atherton, Woodside, Portola Valley, and Los Altos, occupy the very apex of the peninsula�s socioeconomic pyramid. With a pneumatic money-tube running from the Science and Engineering Quad straight up Sand Hill, it�s not surprising that Stanford�s computer classrooms have a reputation as Silicon Valley�s farm team. It�s a reputation that Stanford seems desperate to dispel by hastily constructing a brand-new campus arts center and touting its high-culture amenities.

Across El Camino from Stanford is Palo Alto, a once-sleepy college town whose poky bookstores and musical-instrument shops along University Avenue long ago gave way to Restoration Hardware, Lululemon, Whole Foods, the Apple Store, Starbucks, and dozens upon dozens of trendy restaurants. (A similar transformation has occurred in Mountain View, a formerly working-class town just below Palo Alto whose main drag, Castro Street, is now a nearly 100 percent foodie destination.) A charming Victorian neighborhood around the corner from downtown Palo Alto, nicknamed Professorville because so many Stanford faculty members lived there at the turn of the 20th century, houses hardly any professors nowadays�few of them can afford to buy a house in the $2 million range. (Stanford now supplies much of its faculty housing on its own campus.)

The same west-to-east trickle-down demographic prevails up and down the peninsula: tree-shaded property porn for tycoons in the foothills closest to the Pacific Ocean and million-dollar tract houses on modest-size lots in the sprawling valley center. San Francisco itself, although 30 miles north of the valley, has turned into yet another pricey valley outpost, spawning an entire literature of protest written by earlier generations of San Francisco gentrifiers against the �Google buses,� the white-painted free shuttles that daily cart youthful San Franciscans down the peninsula to the social-media campuses where they work. The price-pressure is exacerbated by the valley�s vise-like physical geography that crowds its residents onto the shoreline of the bay. The Santa Cruz Mountains, gorgeous with their shield of redwoods, Douglas firs, and California live oaks but mostly uninhabitable, occupy the bulk of the peninsula, so that the valley itself, technically speaking, consists only of the heart-shaped plain south of the bay between the Santa Cruz Mountains and their arid opposite number, the Diablo Range, which snakes up the bay�s east side.

In the industrial-zoned flatlands along the bay and along the truck-route Bayshore Freeway that runs alongside it are ethnic poverty pockets, mostly Hispanic and reputedly so crime-infested that few residents of other parts of the peninsula venture away from the through-traffic arteries transporting them to the Bayshore or to the Dumbarton Bridge that connects the peninsula to the East Bay. I discovered while gassing up my rental car one day that the Chevron station on University Avenue, just off the Bayshore in East Palo Alto and only a couple of miles from the Stanford campus, is a well-known haunt of squeegee artists and wraithlike crack beggars, even though it�s just across the road from an ultra-deluxe Four Seasons hotel.

Also along the Bayshore, strung like amber lumps on a statement necklace, are the high-tech behemoths of Silicon Valley, the biggest and most glamorous employers, and the names everyone knows: Oracle in Redwood City and, moving south, Facebook in Menlo Park; then Stanford the mother ship and, in Palo Alto, Tesla Motors and Hewlett-Packard, the latter founded by Stanford graduates Bill Hewlett and David Packard; and farther south, Google in Mountain View, LinkedIn and Yahoo in Sunnyvale, and Apple in Cupertino just below Sunnyvale. At both ends of this chain are startups: in San Francisco because hipsters like urban-scapes and group houses, and in San Jose because the living there is relatively cheap. But since three-fourths of startups fail, and the aim of nearly every startup entrepreneur is to be acquired by, say, Google, the �campuses,� as they call themselves, of the tech behemoths along the Bayshore dominate the valley�s economic and social landscape. It is that handful of companies that constitute Silicon Valley�s seemingly permanent tech oligarchy. They have also produced the valley�s celebrity billionaires on the Forbes list: Oracle founder Larry Ellison ($41 billion), Google cofounder Larry Page ($25 billion), Facebook founder Mark Zuckerberg ($19 billion), Apple founder Steve Jobs�s widow, Laurene ($12 billion), Tesla founder Elon Musk ($7 billion).

This was not always so. In the 1970s, the decade during which Silicon Valley got its name (its previous moniker had been the Santa Clara Valley and its chief product stone fruits), the area was an economically wide-open mecca that held out a graspable lure of middle-class prosperity to the middle-class engineers, often hailing from no-name schools, not Stanford, who flocked in to raise their families under the California sun in those then-affordable tract houses. The dominant companies of that era�Hewlett-Packard (Palo Alto), Advanced Micro Devices (Sunnyvale), Intel (Santa Clara), and later, Apple�were essentially manufacturing companies that built things (hardware and chips), so there were factory jobs for the working class. There was a democratic ethos. �During those 10 or 15 years, all you had to be was in the right place at the right time,� Samuel Abrams, a political science professor at Sarah Lawrence College, told me in a telephone interview. �It was a free-for-all, and the barriers to entry were very low.� Myths of origin, such as Hewlett-Packard starting out in the Palo Alto garage of David Packard, or Google starting out in 1998 in the Menlo Park garage of Google executive Susan Wojcicki, were grounded in reality. During the 1990s most of the manufacturing jobs disappeared, primarily to China, with the lowering of trade barriers, but the software revolution, generating startups all over the valley, kept the economy booming until the dotcom bust of 2000.

Over the past decade, there has been another sea-change. The valley�s economic base has shifted from hardware and software to social media, where the profits come from advertising and the selling of users� data. The Facebook campus, for example, occupies the former headquarters of the defunct components manufacturer Sun Microsystems, bought out by and merged with Oracle in 2010. Google occupies the former headquarters of the defunct Silicon Graphics, which made high-end computers and displays. The other shift has been to a venture-capital financing regime for startups that is �much more structured,� said Abrams. �There used to be a Wild West atmosphere, but now you�ve got angel investors and big players, and the small players all want to be bought by the big players. But still, if you can code, you can still do very well. People can still create new programs sitting in a coffee shop.�

The Google campus in Mountain View�because it�s the only one of the high-tech campuses where visitors are free to walk around (Facebook and Yahoo are barred by gates and security guards)�has become a required stop on the Silicon Valley tourist circuit. So I explored at noontime, taking in the huffing and puffing on Google-supplied bicycles painted in Google-signature primary colors, the posters for the Google-supplied free Thursday movies, the �Electric Car Lot� (Teslas, Volts, and Leafs), the parking-lot vans that offer everything from free dental checkups to free clothes-cleaning (today, it was a turquoise-blue �Pretty Palace� for female hair-styling), the Google Garden, a largely symbolic display of a handful of corn and tomato plants (who at Google has time to cook the stuff?), the similarly symbolic locavore Google recipe posted on the Google Garden fence (quinoa, scallops, and snow peas�who has time to make that?), and above all, the Google employees, cycling, walking with their baby strollers (Google offers free day care), eating under white outdoor umbrellas their Google-supplied free lunches catered by at least four different Google cafeterias. The Google male uniform (there aren�t many females in tech): a T-shirt or polo worn outside the pants with a clipped-on Google ID dangling from the hem. It was no country for old men. Males over age 50�make that age 40�who want a Silicon Valley job are advised to shave their heads, pull out their shirttails, and lose the watch (young people tell time exclusively from their iPhones).

Google is visually impressive, but this frenzy of energy and hipness hasn�t generated large numbers of jobs, much less what we think of as middle-class jobs, the kinds of unglamorous but solid employment that generates annual household incomes between $44,000 and $155,000. The state of California (according to a 2011 study by the Public Policy Institute of California) could boast in 1980 that some 60 percent of its families were middle-income as measured in today�s dollars, but by 2010 only 48 percent of California families fell into that category, and the income gap between the state�s highest and lowest earners had doubled. In Silicon Valley there has actually been a net job loss in tech-related industries over the past decade. According to figures collected by Joel Kotkin, the dotcom crash wiped out 70,000 jobs in the valley in a little over a single year, and since then the tech industry has added only 30,000 new ones, leaving the bay region with a net 40,000 fewer jobs than existed in 2001.

The big names in tech might be awash in capital and might have made their founders billionaires (New Economy founders typically retain large blocks of their own stock), but they employ surprisingly small numbers of U.S. workers. Google, the valley�s largest employer, has 46,000 people on its payroll. Facebook employs only 4,600, and Twitter, in San Francisco, fewer than 2,000. Apple claims 400,000 people putting together components and creating apps and other extras for its iPhones, iPads, iPods, MacBooks, and desktop computers. Yet only 16,000 of those are on the payroll in Cupertino. Another 31,000 work at Apple operations in Texas and other states, but the vast bulk of manufacturing is outsourced abroad via contractors to China and other cheap-labor purgatories. Yet those 16,000 in Cupertino make Apple the second-largest employer in the valley. Kotkin compares those numbers to the 212,000 employed by GM, the 170,000 employed by Ford, and the more than 100,000 employed by Exxon Mobil, all three presumably Old Economy dinosaurs. The New Economy generates prosperity all right, prosperity that mostly flows to those in the upper echelons.

Furthermore, the oligarchs of Silicon Valley seem intent on keeping the social pyramid stacked in exactly the same layers in which it�s stacked right now. After decades of political quietism during which Silicon Valley entrepreneurs expressed libertarian sentiments but mostly voted Democratic and funded Democratic candidates who shared their elite-class social and political views, Silicon Valley has finally mobilized�for immigration expansion. In April Mark Zuckerberg, with help from Yahoo CEO Marissa Mayer, LinkedIn cofounder Reid Hoffman, and venture capitalist John Doerr, launched FWD.us, a $25 million-and-counting lobbying group aimed at lawmakers in both political parties. FWD.us, unlike other pro-immigration groups, isn�t much interested in amnesty for illegal immigrants or easier border-crossing for lettuce-pickers. Its chief interest is in expanding the H-1B work visa program for �highly skilled� workers that�s mostly used by tech employers to hire temporary guest-workers from foreign countries, usually from East and South Asia. Valley executives have been calling for decades for H-1B expansion (the current cap is 65,000 visas annually, although thanks to loopholes and related programs, it�s actually about double that). During the 1990s the argument was that native-born U.S. programmers were set-in-their-ways oldsters (translation: men and women in their forties) whose brain cells couldn�t make the transition from, say, COBOL to more up-to-date coding languages. The new argument is that tech workers are in dangerously short supply, especially �the best, brightest, and hardest workers,� as New York City mayor Michael Bloomberg, an H-1B expansion advocate, testified before Congress in February.

FWD.us certainly has allies in the bay area�s substantial Indian community. At a gym in Fremont, a middle-income suburb directly across the bay from East Palo Alto that counts 40,000 Indians among its 222,000 residents, I interviewed 38-year-old Nikesh Kalra, Santa Clara-born of Indian immigrant parents, who, with an MBA from Oxford, is an executive for Equinix, a cloud-storage landlord headquartered in Redwood City. �The perception is that Indians are taking away good American jobs,� Kalma said. �The reality is that you Americans can�t turn out engineers fast enough.�

The anti-H-1B faction has a response to that: statistics. One of them, from an April 24 briefing paper produced by the liberal Economic Policy Institute, is that only one out of every two U.S. college graduates with a degree in engineering or computer and information science is hired into those fields, despite a doubling of the number of homegrown computer-science graduates between 1998 and 2004. Others argue that employers mostly don�t use H-1B workers to fill �best and brightest� jobs, but, rather, relatively low-paying routine programming positions, and that the most avid users of the visas are India-based outsourcing companies that use the visas to provide a few months of U.S. training for their employees, who then return to India.

Most damning of all is that, despite persistent claims of tech-worker shortages, programmer salaries overall have inched only slightly higher from what they were 20 years ago: from $60,000 a year to about $75,000 a year in 2012 dollars, according to the Economic Policy Institute. Engineers fare somewhat better: The average annual starting salary at top valley employers such as Google is about $100,000, with the median for experienced engineers at about $150,000. Even with the stock options many employers offer, that doesn�t go far toward buying even the smallest million-dollar valley house. A group of software engineers has a pending lawsuit alleging that four of the biggest employers�Apple, Google, Intel, and Adobe Systems in San Jose�violated federal antitrust laws between 2005 and 2009 by agreeing not to �poach� each other�s employees with offers of higher pay.

On top of those perhaps deliberately depressed salaries and the high cost of existing housing are a raft of California �green� laws�enthusiastically supported, as one might expect, by the valley�s tech elite in a post-manufacturing economy�that make life there even more expensive, and family-friendly housing even less attainable. Renewable-energy mandates drive up utility costs, and environmentally driven land-use restrictions and �smart growth� plans have made the construction of new single-family homes in the valley all but impossible for everyone except those affluent enough to own a large-lot teardown.

Not surprisingly, the lower-echelon tech employees and midskill workers cram themselves into the enormous apartment complexes that line El Camino and some of its side-arteries, many of which are attractive enough for singles although not especially hospitable to raising children. Then they give up and move to Utah or Texas or some other state with lower taxes and cheaper housing, or they resign themselves to hours-long, traffic-clogged commutes to Fremont and other less expensive, less pretty suburbs across the bay in Alameda County, where housing prices are also rising but not quite so rapidly.

If you can manage to hoist yourself precariously�most likely via a high-earning spouse�into the valley �middle class,� you can lead a fairly comfortable, if extremely expensive life. You are, after all, living in one of the most beautiful parts of California, with the mountains and the Pacific Ocean at your back door, and, not far away, the luscious Napa Valley wine country and Sierra Nevada hiking and skiing. �The climate here is great, and the food is really good,� a midlevel tech executive told me over the telephone. �People talk about all the luxury cars that you see on the Bayshore Freeway, but if you�ve got a long commute, and your house isn�t all that big, spending money on a car that�s comfortable and makes you happy makes perfect sense. Fifty-thousand dollars, $75,000 for a car is nothing compared with your housing costs. That�s why people do it. And it�s not like Hollywood here, where if you don�t succeed, it�s winner take all, and you�ve got to go wait on tables for the rest of your life. Here, you might go to work for a startup, and if it fails, you�ve at least made a comfortable salary you can live on�and you can go to work for another startup. There�s a sense of community here. Everybody knows everybody, and you can make connections.�

The extreme economic and social inequality that characterizes Silicon Valley is not exactly the way it was supposed to be. Globalization and de-industrialization were supposed to free up Americans for better-paying, more interesting work; all they had to do was retrain themselves for the information age. The 2002 book The Rise of the Creative Class, by Richard Florida, then an urban studies professor at Carnegie Mellon University (he is now at the University of Toronto), urged Americans to embrace what Florida called �the knowledge economy� and touted high-tech entrepreneurs as massive job-creators. Florida launched a lucrative side-career for himself advising Northeastern cities ravaged by deindustrialization on how to attract some of those entrepreneurs and other affluent young professionals by reinventing themselves as hip, gay-friendly, arts-promoting hubs where the cool people would want to hang. As recently as late October of this year, Florida, in a blog entry for the Atlantic, was promoting Silicon Valley and its environs as America�s number-one jobs-generator. Florida wrote: �[H]igh-paying, high-tech jobs are key factors in economic growth and prosperity.�

The current long-running recession, together with the fact that most of the jobs that have been created recently are at the low-wage bottom, has led the futurists to adjust their rhetoric radically. They have switched from the manic-phase optimism of the 1990s and early 2000s to a combination of putting a happy face on middle-class disappearance and telling Americans to get used to it. Florida, for example, candidly admitted in one of his recent Atlantic posts that what he called the �talent clustering process,� the agglomeration of �highly skilled knowledge, professional, and creative workers� in �knowledge-based metros� such as Silicon Valley �provides little in the way of trickle-down benefits� to those lower on the scale of brains and education.

The bright-side-of-life school argues, au contraire, that the benefits will continue to trickle, if not exactly as palatably as the 1990s optimists envisioned them. That school includes Enrico Moretti, a labor economist at the University of California, Berkeley, writing for the Wall Street Journal last September: �For each new software designer hired at Twitter in San Francisco, there are five new job openings for baristas, personal trainers, therapists and taxi drivers.� Michael Mandel and Judith Scherer of South Mountain Economics, in a 2012 paper titled �The Geography of the App Economy,� arrived at a similar ratio, as long as you count pizza-deliveryman as a tech-economy spinoff job. Ray Fisman, a Columbia Business School professor writing in Slate, advised victims of deindustrialization to move to tech centers, where they could collect �more than a few crumbs� working as manicurists and lawn cutters for their more creative overlords.

Tyler Cowen in Average Is Over is more forthright. He advises the construction of Rio de Janeiro-style shantytowns for the 85 percent of Americans whose livelihoods will be swept away by the New Knowledge Economy he touts�although no shantytowns, please, in Cowen�s own neighborhood in upscale Fairfax County, Virginia! And also, says Cowen:

There is one final way in which we will adjust to uneven wage patterns and that is with our tastes. Many of society�s lower earners will reshape their tastes�will have to reshape their tastes�toward cheaper desires. Caviar is an expensive desire and Goya canned beans is a relatively cheap desire. Don�t scoff at the beans: With an income above the national average, I receive more pleasure from the beans, which I cook with freshly ground cumin and rehydrated pureed chilies.

Yes! Let them eat beans! Master and servant. Oligarchs and serfs. Two years ago the Occupy movement of progressives raised a battle cry against the �1 percent,� who were supposed to be striped-pants, Republican-voting tycoons lifted from the Monopoly board. What they didn�t know was that the 1 percent actually wear rubber shower sandals, ride bicycles�$20,000 bicycles�and vote Democratic and green, green, green. It was them. It was the future, and it has already arrived in the Silicon Valley.

The wife and I were just talking about that over supper tonight.

We need to cut an inch or two off the pricks of the few and give to the many, Sycamore.

I don't get the gist of the article I guess.

They made the money so I'm supposed to be upset that I don't have what they have?

Whatever.

For what it's worth, you couldn't pay me to live there. Not only is it a liberal hotbed, but it borders one of the worst areas in Ca. They can have it.

BFD

I guess reading comprehension is not on the MCAT?

Sycamore

BFD

It's just too bad that the entire west coast of CA is getting irradiated from [bleep] (sp?) fallout!! They're "going green" alright!!! HAHAHA!!!

This article is insane rumblings by communists or progressive fascists complaining that successful people make a lot of money. They can't point to any evil that they have done so they just try to use class warfare ideology to complain

and these Mega wealthy are some of the biggest supporters of illegal immigration.

We're supposed to be outrageously outraged that some folks are making money and that some aren't.

The really outrageous thing is that most of the folks (rich and middle class) in the article vote Democrat. They're all for "income redistribution" when it involves the govt. taking from others in the form of taxes, yet, they refuse to run their private businesses that way.

When was the last time you saw a liberal college professor demanding that the college take a large portion of their six figure PhD salary and "redistribute" it to the janitors and groundskeepers at the college???

Yeah, I musta missed that protest, too.........

I didn't quite get that out of it. They did point out that Progressive policies are a major part of what ails Silicon Valley and the US in general.

The economy is changing. Money is shifting away from labor and towards capital ownership. The best way for the average Joe to deal with this is to own capital, capital in the form of stocks. The old "save 10% of your income" rule just doesn't get it. These days it's more like 25%.

The majority of the shift is due to Gov't policy, and I don't mean a lack of taxation. Mostly, it's regulation that is killing the middle class. For instance, how can we compete with countries like China that are enveloped in a fog of smoke from production when we can't even have a Sriracha hot sauce plant? Until that changes, we are doomed.

Study nations that have avidly gone into "redistribution" of wealth. No one has their standard of living raised. In actual practice a vast majority of the citizens have their assets compressed to a lower level. The elite, political, or whatever, remains the same or more often have their standards raised substantially.

Gee, can we draw any parallels here? i.e. The old Soviet Union, Cuba, Zimbabwe, et al.

Huh?

I believe the article indicates this is happening under capitalism now.

Sycamore

for an easy example, you might study up on why DC and its surrounding counties have been immune from the current six year recession, and experienced constant income growth and booming real estate prices.

Class warfare, pure and simple. That man made it through hard work and luck and I want my share, without working for it. miles

What capitalism? Where? Us, we are far from being a capitalist country. Try making a product and selling it with out the .gov's permission and tell me about capitalism.

You're not full of turkey already, are you counselor?

I'm pointing out the illogical construction of:

No one has their standard of living raised.

The elite, political, or whatever, remains the same or more often have their standards raised substantially.

So...does no one have their standard raised, or does the elite have their standard raised? It can't be both.

Sycamore


p/s don't be harshin' on brother Bob, he works hard for his money, redistibutin' income.

I didn't see that in the article. I saw a description of a system that has the middle (that we've taken for granted since WWII) being hollowed out. I saw it being ascribed to national and international economic and political realities.

I didn't even see it being considered as good or bad, just as what is happening.

Sycamore

Well, the article was describing Silicon Valley. What form of economy would you describe Silicon Valley as?

Sycamore

That was about the time he was giving arms to Muslim Extremists in exchange for hostages, right?

Sycamore

Thank you perfesser....I'll take my C- and retreat.

Jealousy and envy are ugly emotions often used by the left to incite the failed.

Roundup is correct. The only ones who make out are a select few who either A) work for gov't B) ride waves of gov't regulation either through bribes to make it happen or inside knowledge of Govt regs or C) the one-in-ten million entrepreneur who is lucky enough to have a good idea and see it through and become a billionaire.

Sycamore, do you suggest we all get Gov't jobs? Is that the key? We can surf porn all day and live off taxes.

If you want to provide for the general welfare of the citizens, you have to cut down on the non-productive (i.e. Gov't employees & those who receive transfer payments) and cut the regulations and taxes that force productive jobs to be moved overseas.

.gov style equality in Dimocrap country, coming to commiefornica

Any of those Silicon Valley companies get a sweet tax break for being there?
http://www.bizjournals.com/sanjose/...mont-courts-silicon-valley.html?page=all
That's not capitalism, it's graft.

And your guys are going to secure the borders to prevent the poor from being taken advantage of, right?

A wise man said, better to be full of wild turkey than to be full of chitt.

what! bidness gettin hep from the gubment? nevah happen, Cap'n. Not in dis year Newnited States and Texas!

Annybuddy say different is a commonist!

Next thing you know, you'll be talking about depletion allowances and depreciation schedules!!

Nobody in Oil or Deefense gets no tax breaks, gubmint money, or military protection, or free research, either!!

You dog!

Sycamore

fixed it for ya'. you're a silly goose if you think either side of spectrum, or the aisle has a lock on vice or virtue.

Sycamore

Which is the party of class envy?

Both, actually. Most small-minded people are convinced somebody else is getting more benefits with less work than they are.

Sometimes they're right.

Sycamore

The country should be more concerned with intelligence inequality.

...the poor we shall always have with us....

Sycamore

My point is, that ain't capitalism.

Right its corporatism...been that for a long time...and it just eats away at the nation's wealth.

You start getting between lobbyists and a dollar, they're gonna find you floatiin' facedown in the Atlantic!

Sycamore

Right. Your credibility just suffered a major hit.

So...where DID the middle class go?

Sycamore

They were sent reservations.

"They got this and that and
With a rattle a tat
Testing one two,
Now what you gonna do?
Bad news, misused,
Got too much to lose
Gimme some truth
Now whose side are we on?
Whatever you say
Turn on the boob tube
I'm in the mood to obey
So lead me astray by the way, now

Where'd all the good people go?
I've been changing channels
I don't see them on the TV shows
Where'd all the good people go?
We got heaps and heaps of what we sow "

Good one!

No it is cronyism, the ill of government.

It's unavoidable, Sycamore. So few (here and elsewhere) understand what the meaning of "Structural Unemployment" really means for us, going forward. And,,,it's here to stay, no policies, etc. will EVER change it. That be fact.

A good read on similar to what you posted here at the onset was written a while back and is named "The Future of Work". By Jeremy Rifkin. Toffler's "Third Wave" is another. Scary schitt in a way.

This is gonna affect emerging folks even more so than us, places like China, India, etc. One example is a car/truck factory in India that employed 10,000 people. Built a new, modern, automated one right next to it that has 1200 employees and with 30% more output of higher quality roadies.

Then, there's always the old favorite read named "The Bell Curve". Problem with that book is that too few have the needed comprehension to read it and understand what the numbers within imply. The chasm between the haves and the have nots will only widen and deepen until another Huey P. Long comes along. Bammy is close enough on that one.

Good subject, Sycamore.

We need equality. Those guys with big ones have an unfair advantage and should be cut back.

Try opening your own business and paying people to deal with .gov red tape and you will see where it went.

yep....live someplace with nearly 30% unemployment and i cant get anyone to apply for our ad sales position.....they would rather make less sitting on their arse and being handed money from .gov.....or if they have a bunch of kids i cant match what .gov is paying them to sit on their arse....

meanwhile i have to fight to even find a insurance program to offer my employees(we are one of the lucky ones that will still be able to offer our employees insurance next year).....thankfully our plan is half arse tied to the state employee plan so aslong as the state employees have insurance offered them so should we be able to buy into it....

My brother has 16 employees in Texas. Humana has just notified him they will be no longer be doing health coverage for small businesses in Texas. He will have to use Ocare or BCBullChitt and the cost will rise from $350,000 per to about $700,000 per year, which is much more than he makes out of it.

if he doesn't provide the care the better oilfield employees can go to big companies to get it.

O Care is designed to put small co's out of business.

So, open up, have fun and get rich working 7 days a week, Sycem.

Perfect example of regulation causing industry consolidation (income inequality) while directly destroying the middle class.

I'll take that distraction as 'I concede the point'.

Income inequality is in the minds of those that are susceptible to penis envy.

pretty much.....ive always been at the lower end of the scale and sure havent thought it was anyone elses problem to deal with but my own.....sure in the [bleep] dont "deserve" to be given money out of someone elses pocket just cause they were more successful than me.....

Precisely. Also the "middle class" always has the possibility of moving UP, just like the more affluent can (and do) go down. The problems nowadays is (in addition to the obvious) are also the fact LOTS of people in the middle class want freeshit for little or no effort AND they want to get paid wages they don't deserve.

Atherton, Calif.( )
"If you live here, you�ve made it,�Silicon Valley� >>>>>>>lololololololollo!!!! lolololololololol! man that's funny stuff rite there!!!!

Did you go to phlebotomy school with Eyeball? That WAS the point of the OP.

Sycamore

Or don't they require the MCAT in Grenada?

Sycamore

No, the point that you attempted to foist on us was that the Democrats don't own the class envy game.

I read on this very site, all the time, that "poor people" sit around all day, and cash checks for tons of money, whilst the rest of us have to work our asses off.

And those poor people go to Hawaii with their EBT cards from Texas! Dammit!


If that ain't class envy, I don't know what is.

You are sitting around, belly aching that a person in another class is spending money they haven't earned.

And that in a more equitable society, income would be based on (something else)

Sycamore

i get to beotch cause im paying for it and im not getting to sit around on my arse.....for [bleep] sake i prolly qualify for disability and i work a full time plus job and occasionally bartend a few afternoon shifts.....and in a place with nearly 30% unemployment numbers i cant even get anyone to apply for our ad sales/front office person position so i can quit trying to cover 3 positions and go back to just covering 2

I thought you were smarter than that, Boy was I way the [bleep] off base. You're just as stupid as NWA, SAC or Ppine.

I thought maybe you were one of those liberals that understood the basics of society but were a little mislead on the other parts.

Guess not!

Better yet Sycamore I'm gonna give you a chance to put your money where your mouth is......

In the not to distant future I'm going to have to have back surgery, I'm trying to put it off as long as possible but it will be needed soon. So after the surgery I will be off work for 3 to 6 months the doc says, during that time my income will be drastically cut and money will be very, very, tight.

It would be great to have someone step up and fill in the gaps for me, Are you willing to step up?

Put it this way, I won't stand by the mailbox waiting for your check. It always good when it's someone else's money eh?

http://www.aljazeera.com/news/europ...rallies-escalate-201312321282718351.html

that is the definition of class envy, and you know it.

Sycamore

not when that money was taken from me through threat of imprisonment.......aint class envy its being pissed at a government that takes money from me by force and gives it to another group in order to buy votes....

First of all I didn't say what you quoted above, You should learn how to use the features of this site.

Second, I would agree with the above statement if you took the n't off of haven't, "sitting around, belly aching that a person in another class is spending money they haven't earned" is just that "Belly Aching" I guarantee you any body sitting around bitchin' about that sure the hell don't want ot be in that position.

Sitting around, belly aching that a person in another class has to much money and thinking they should give it to you just because you should have it, well that is class envy and jealousy, neither of which is good.

Third, ...Actually Sycamore, you are sort of wrong....again.

Now there you go again, harshin' on the deefense budget AND the farm subsidies!! shame on you!

Sycamore

Paul,

you are wrong about what the article said, and wrong about what I think.

Which isn't uncommon, anytime someone throws up "class envy".

Nothing in that article talked about re-distributing income, it talked about how there was a whole segment of jobs gone missing.

I hear a ton of people on this site bitching about poor people who don't have work.

But anytime someone mentions those industrial high paying jobs are fewer and fewer in America, they are accused of all kinds of things.

Also, in case you didn't notice, or read that far, I wasn't the author of the article, nor did I require, cajole, or request you to agree with its premise.

I found it interesting, and re-posted it.

From that, you were able to tell my politics, my voting record, my batting record in the Connie Mack World Series, and the last time I had a bowel movement.

You should be on Wall Street, with your abilities.

Sycamore

A dictionary would save you some embarrassment.

Actually, a dictionary would save you some typing.

Sycamore

Keep digging. Envy Words already have meanings. We don't need the left to redefine them for us.

Equivocation - the necessary tool of leftist propaganda.

eg. disagreement must morph into hate or ya can't get folks hated.

Syc, you can do better.

You need to go back a couple of steps. I didn't respond to the story you posted I responded to the post you made, I will quote it for you below in case you forgot what you said.


To be honest with you I could give a [bleep] less what the story said. I cannot tell your politics by the story you posted but I can figure with pretty good certainty your politics by the posts that you make.

Let me see.......

Your a liberal not a progressive or at least a liberal who doesn't know he's a liberal yet.(there are lots of these around)

You believe that all folks are entitled to health care insurance whether or not they earn it.
you believe that all folks should be able to earn a good wage whether or not they want to earn it.
you believe the republican party is dead.
you believe It's possible I'm a racist because I don't like Obama
you believe I'm a republican.
You believe corporate America is to blame for the impoverishment of the poor and should be responsible for taking care of them.

I could go on and on but let me know how I'm doing so far.




You need to put on your listening ears! Is what you hear is people bitchin' about people who are capable of working but don't want to and instead play the system and get public assistance, IMO people who do this are lazy azz POS who don't deserve to be pissed on when their on fire. I can't remember one time of anyone hear bitchin' about some one who was legitimately disabled and receiving public assistance.

The problem with the article is that he somehow blames successful people for being successful and pretends that they are taking stuff away from the poor and middle class. That is communist redistribution philosophy.

Sycamore, based on your comments, I am beginning to think that maybe you don't know the difference between "envy" and "disgust". Just in case, envy has to do with wanting things or conditions possessed by another - disgust has to do with deploring a situation or behavior.

I once experienced a guy who thought it made him look smart and important when he cut and pasted big articles onto a website, and then pretended to be a discussion leader with superior insight because he knew how to cut and paste.

It's the guys who know how to think and write that I admire here.

Who they be! Send em out. There are a lot here that grunt and belch bullshit in unison.

CCCC,


Envy is envy. 'Class Envy' is looking around, and saying, "if those "others" had less, I would have more"

That is not limited to one party, or one income level.

Sycamore

Conrad,

I didn't see him blaming. I think he was observing there was a smaller and smaller middle. Which is a function of losing our manufacturing capacity, AND the fact that manufacturing needs more robots and less people now days. He was also saying it might stay like this for a long time.

Please go back and read the article in that light, see if you see what I saw.

Sycamore

Said the pot to the kettle.

Sycamore, by your narrow interpretation, it looks as though you are attempting to impose limits on the thinking and attitudes of others, apparently to prove some point - to yourself.

Your projection of "envy" onto others - which seems to be a need on your part - does not at all define them as envious. Your approach does not hold water - it does not work.

If a person is discouraged, disgusted, resentful, etc., etc. due to willful and corrupt misuse of his money (taxes imposed by the government), none of those positions/attitudes fit your envy theory. The fact that you are fixated on envy (consider that!) does not enable you to define others in the same fashion. Very weak position.

I've never met a man or women who improved their standing in life by beetching and moaning about what someone else has that they don't and how that person should be given something they didn't earn.

I do no many people that have become wealthy because they spent years and years gaining valuable skills and then worked very hard for years and years.

Perhaps a more poingent article would be work ethic inequality, or if you want to become successful don't wait around for the government to hand you someone elses wealth.

Mag, forgot you just fart a lot!

baaammmacare got your back

http://www.heritage.org/research/re...nd-minimum-wage-hike-on-workers-and-jobs

You truly are your masters dog.

CCCC,

You can go back and check, I'm not the one who brings up "class envy". I'm just saying envy is not the same as "class envy", and "class envy" swings both ways.

The fact that that makes some people on here so darned uncomfortable is telling.

Sycamore

I agree with your first two points, for the third one, it is best to hire a lobbyist, to build you a subsidy, or grant a tax-advantage, that beats waiting around all-to-heck!

Sycamore

Lott That and lying are the main skills of Tyrant Obama and his progressive fascist crew. They bitch an moan and lie about how others are successful and how unfair it is to the poor in order to win their support. Then they get rich through corruption while in office.

Odd how this is a huge topic now that Obamacare flamed out so visibly. Oh look, Shiny! and the gullible stumble forward staring at the new object that their betters threw in their path.