<nettime> "California Feudalism"

[Bruce Sterling <bruces@well.com>]

*The upshot of the California Ideology, or, “Gold rushes finish ugly”. — bruces

http://www.newgeography.com/files/Feudalism_Web.pdf

(…)

California’s Recent Evolution 

California’s economic diversity, which spans agriculture, home-building, aerospace, entertainment and tech, has long provided enormous opportunities for a broad range of residents. Even as recently as the 1996-2006 period, California job creation was well-distributed in terms of regions, job types and incomes. 

The recovery after the great recession, which hit California more profoundly than it did the rest of the country, created a far more narrow, weak, and geographically constrained economy2 (Figure 1). 

Today California’s economy is dominated by a handful of Bay Area tech firms that have expanded at one of the most dynamic paces in economic history. Most of these companies are in a relatively constrained geography along the San Francisco Peninsula. Together, these tech firms—Apple, Netflix, Facebook, Google—along with Microsoft and Amazon, have achieved a combined net worth equal to one-quarter of the NASDAQ and equal to the GDP of France. The S&P 500, the broad index of stocks, has a total market capitalization of approximately $24.2 trillion slightly more than the GDP of the country. They represent 15% of the entire S&P 500 companies’ market capitalization.3 

This has been a heady period for the Bay Area, with San Jose and San Francisco boasting the first and third highest average per capita income in the country.4 Between 2007 and 2016, according to an analysis of Bureau of Labor Statistics data, the Bay Area created 200,000 jobs that paid better than $70,000 annually. Yet during that same period, high wage jobs dropped in Southern California and statewide; simply put, the Bay Area replaced the high wage jobs lost in the recession while the rest of the state did not 5 (Figure 2). 

Part of the problem has been big losses in blue collar jobs, critical to the state’s working class. California lost 423,700 manufacturing jobs between 1991 and 2016. Such jobs pay significantly better than the retail and service industry jobs that have characterized the post- recession growth.6 Minimum or near minimum wage jobs in 2015-6 accounted for almost two thirds of the state’s new job growth, notes the state’s Business Roundtable.7 These problems have arisen in “boom times,” so we should be particularly concerned about what will happen if, as appears likely, the economy slows.8 By late 2017 California’s GDP growth rate, once well above the national average, was beginning to fall below it.  (((etc etc etc)))


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