12 Jun 2017

Kotkin on California’s Feudal Socialism

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San Francisco Bay area from Grizzly Peak

Joel Kotkin admires the contradictions inherent in California’s Socialism.

The oligarchs of the Bay Area have a problem: They must square their progressive worldview with their enormous wealth. They certainly are not socialists in the traditional sense. They see their riches not as a result of class advantages, but rather as reflective of their meritocratic superiority. As former TechCrunch reporter Gregory Ferenstein has observed, they embrace massive inequality as both a given and a logical outcome of the new economy.

The nerd estate is definitely not stupid, and like rulers everywhere, they worry about a revolt of the masses, and even the unionization of their companies. Their gambit is to expand the welfare state to keep the hoi polloi in line. Many, including Mark Zuckerberg, now favor an income stipend that could prevent mass homelessness and malnutrition.

Unlike its failed predecessor, this new, greener socialism seeks not to weaken, but rather to preserve, the emerging class structure. Brown and his acolytes have slowed upward mobility by environment restrictions that have cramped home production of all kinds, particularly the building of moderate-cost single-family homes on the periphery. All of this, at a time when millennials nationwide, contrary to the assertion of Brown’s “smart growth” allies, are beginning to buy cars, homes and move to the suburbs.

In contrast, many in Sacramento appear to have disdain for expanding the “California dream” of property ownership. The state’s planners are creating policies that will ultimately lead to the effective socialization of the regulated housing market, as more people are unable to afford housing without subsidies. Increasingly, these efforts are being imposed with little or no public input by increasingly opaque regional agencies.

To these burdens, there are now growing calls for a single-payer health care system — which, in principle, is not a terrible idea, but it will include the undocumented, essentially inviting the poor to bring their sick relatives here. The state Senate passed the bill without identifying a funding source to pay the estimated $400 billion annual cost, leading even former Los Angeles Mayor Antonio Villaraigosa to describe it as “snake oil.” It may be more like hemlock for California’s middle-income earners, who, even with the cost of private health care removed, would have to fork over an estimated $50 billion to $100 billion a year in new taxes to pay for it.

In the end, we are witnessing the continuation of an evolving class war, pitting the oligarchs and their political allies against the state’s diminished middle and working classes. It might work politically, as the California electorate itself becomes more dependent on government largesse, but it’s hard to see how the state makes ends meet in the longer run without confiscating the billions now held by the ruling tech oligarchs.

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JK Brown

“I found crucial to what is distinct between libertarians and valley folk that Silicon Valley’s ideology is pro-market but it is not pro-liberty. Liberty is not a value. They are highly, highly, collectivist. They believe that every single person has a positive obligation to society and the government can help people or coerce people or incentive into making a unique contribution.”

–Gregory Ferenstein

http://www.aei.org/publication/what-does-silicon-valley-seem-to-love-democrats-and-dimiss-the-gop-a-qa-with-journalist-greg-ferenstein/



Seattle Sam

One of the most valuable and underrated aspects of our Constitution is Federalism. It allows (or should allow) states like California to create the regulatory environments they desire. And the other states can watch what happens. Anyone who even attended an economics 101 class can tell you what will happen directionally. California will import people who desire benefits they don’t have to work for or pay for themselves. And it will export the most productive people. California will end up with a barbell population distribution — a few really wealthy people who can afford to insulate themselves from the effects and a lot of people whose existence depends on the state.



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