The Bay Area is an oligarchy.. I went to hear a panel earlier on…
By: John J. Parman
Tags: Bay Area, Occupy, Oligarchy, Oakland

I went to StoreFrontLab in the Mission to hear a Places magazine panel on Oakland, California — Johore to San Francisco’s Singapore, I thought, but then the discussion shifted to Occupy. While one panelist, D. Scot Miller, was discussing it, it occurred to me, “The Bay Area is an oligarchy.” It may be a “My Private Idaho” version of one, not like certain kleptocracies, but the truth is that we’re overly dependent on the philanthropy of these mega-rich instead of their companies’ taxes.

Miller reminded us that Occupy’s tent encampments inspired the homeless. Occupy in Oakland, he said, was diverse in a way others weren’t. It made me remember how I saw some obviously mentally ill homeless guys standing in solidarity with other Occupy demonstrators at the Bart Station entry where I commuted. Briefly, the homeless joined forces with others who felt they were victims of the oligarchy. That fell apart, but it was true: they were all victims of the oligarchy. They still are.

The Bay Area’s economy is — forgive the visual cliché — as populous as the Netherlands, a country that manages to house people and provide a reasonable safety net. At rough parity, we’re short on affordable housing. Our public services — education and transit both — are inadequately funded. Healthcare is better than it was, but with gaping holes. We have jobs galore, but the pay at the low end doesn’t pay the market’s freight for the basics. In Singapore, getting people to work is the policy, but the basics are subsidized. If you work, you get the basics, and their quality is good. More money gets you something in Singapore, but the policy idea is to ensure the social mobility of each new generation. No matter who the parents are, youth can enter adult life having had a roof over their heads and good education. If higher education isn’t their thing, they still have prospects. We have gigs.

Along with gigs, we have jobs like warehouse workers and delivers that are AI-evaluated and endangered by automation. From the standpoint of the oligarchy, this is an externality. If you slip into homelessness, you’re a charity case. “Talk to our foundation.”

Our problem isn’t that we lack the money, but that the money doesn’t touch the basics. To put this another way, we have an oligarchy by default. Salesforce Park atop San Francisco’s new transit center speaks to our dilemma: an oligarch’s generosity paid for it. But his generosity only goes so far. Tech and biotech: same story. Personal and even corporate largesse is okay up to a point, but the line is drawn on taxes that would underwrite public housing, transit, education, and healthcare at the level of an economy like the Netherlands (that is, at our actual level).

That we have a transit system at all reflects our ability to secure federal investment. That money has been gutted. Californians pay 30 cents out of every federal tax dollar to other states, so not even the diminished amount comes back to us — a situation made worse by Trump’s dislike of the Left Coast. We need a New Green Deal, for sure, but part of that greenery needs to be real tax dollars going to basic services. (We will need public sector benefits reform or it will be unaffordable.)

The model is Singapore: a flat 17-percent corporate tax and a progressive income tax that caps at 22 percent (with no tax on capital gains). Companies can’t escape it, although there are incentives for starting up, etc. It’s low enough that it’s simpler to pay it than evade it. And the money goes visibly to the basics, in parallel with fancier things.

During the panel session, someone in the audience asked what could be done on the arts-and-culture side of things to make Oakland better. The artistry that the Bay Area needs is fiscal: a tax regime that delivers the heft of our economy without diverting it into layers of pork that local governments now insert between too few tax dollars and too many overstressed basic services. (We’ll also need some form of home rule or devolution, so less of our federal tax dollars goes to all those unpopulous states that hate us.) Make taxes worth the money, and make sure that everyone—corporate oligarchs included — pays them. They don’t have to be ruinous to be effective. Au contraire.