Even the richest cities face problems

Last week I wrote about the water shortage in California and suggested that theanti-water charge protesters in this country should consider the reality of water shortages and recognise the need for investment in water infrastructure to ensure an adequate supply of safe water for the future.

Not for the first time, I learned very quickly that it is not safe to broach certain subjects in this country.

I was subjected to an incredible amount of vitriol ranging from personal insults to threats and vile language.

So much for free and open debate. I am consoled by the realisation that when those who oppose one’s views react with ad-hominem attacks using vile language, one must be doing something right.

I find that one of the few positive benefits of getting older is that I care less and less about what people that I either don’t know or don’t respect think of me and what I say. I firmly believe that the introduction of water charges is a good idea, although I fully accept that the Government rushed the process and made a total mess of many aspects of it.

Getting back to my observations of the US, I have to be up front and admit that I really like many aspects of the US economic model and I particularly like the optimism and positivity that permeates much of US society.

Many others around the world obviously share my perspective on the US — otherwise why are millions of people from all over the world constantly trying to get into the country, both legally and illegally?

This summer thousands of Irish students will make their way to the US on J1 visas to enjoy the best that the US has to offer. Those who constantly rail against the US and its system obviously see something that the thousands of people who enter the country and want to enter the country every year are missing.

I am not suggesting the US model is perfect. It is far from it, but the positives clearly outweigh the negatives, otherwise people would be clamouring to enter economic meccas such as Albania, Cuba and North Korea rather than the US. I don’t see that happening too much. While the US is great in many ways, it clearly has its downsides also. Economic success will inevitably be accompanied by problems.

The economy of San Francisco is absolutely booming at the moment on many different fronts, but particularly its property market.

Last week I spoke to a developer who is selling relatively modest properties and is obtaining up to €200,000 more than the asking price, or more than 25% above that price.

The market is currently characterised by excess demand and limited supply. That demand is being heavily driven by the wealth that is being created in Silicon Valley and the migration of highly-skilled IT workers from all over the world into the Bay Area.

The traffic flow from Silicon Valley into San Francisco every evening has to be seen to be believed. While this is all well and good, it is creating enormous difficulties for those who are not earning Silicon Valley salaries. Many are being forced out of the housing market and this is putting an unbearable strain on the rental sector. For Irish students going to San Francisco, getting accommodation is a much bigger problem than getting a job.

It is not at all clear what can be done about this housing shortage. Housing density seems to be very high already and a policy of dampening demand by undermining Silicon Valley is simply not going to happen. The result is that rents are very high, rental properties are very scarce, many are being forced to buy well outside the city and commute, and there is also a massive homelessness problem, much of which is evident within sight of City Hall.

The homeless problem is compounded by the fact that the homeless come from all over the country due to the climate and the fact that the liberal attitude in the city is quite welcoming. Despite this, many are living in dire conditions with serious drug problems in evidence.

It shows that regardless of how successful economies are, there will always be problems that policymakers struggle with. Achieving perfection does not appear possible in any society.

Jim Power


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