Meanwhile, back in the People's Republic of Zuckerstan...
February 27, 2014 7:55 PM   Subscribe

...taking a critical look at the dark side of the "Innovation Economy" There is no Google bus controversy in the Bay State. But the similarities between Boston and San Francisco now include a growing debate over the shadow side of the Innovation Economy:

The cost of housing in Cambridge and Greater Boston has zoomed, with rising rents taking a growing share of dwindling low- and middle-incomes. Partly by design, partly by accident, the corporate consolidation of the housing stock will wind up leaching diversity from neighborhoods by pricing residents out and installing corporate professionals in their place. Innovation means the price of existing goes up.
posted by anelsewhere (28 comments total) 9 users marked this as a favorite
 
I gave it a good read. I think the author has some pretty important points that offer a rare breath of fresh skepticism for the hullaballo in Boston and elsewhere around "innovation." "How new is this future, really?" It's worth asking, and worth examining the social costs and community impact of the breathlessly plumped-up "innovation economy." Thanks for posting.
posted by Miko at 8:16 PM on February 27, 2014 [4 favorites]


'I was attacked for wearing Google Glass' - She said one of her assailants told her, "You guys are killing the city."
posted by unliteral at 8:23 PM on February 27, 2014 [1 favorite]


It's tempting but a mistake I think to see tech and biotech as parallel trends in Boston. In some meaningful ways they compete for the same finite resources. Both tech venture capitalists and biotech vcs ultimate raise money from limited partners. These tend to be large pools of money like university endowments, pensions, insurance funds, etc. For example: Brad Feld, investor behind Techstars and Foundry Group, mentioned in this article, is investing a little bit of his own money and a lot of money from: Guardian Life Insurance, Morgan Stanley, University of Texas, the Abu Dhabi Investment Authority (Procific)*.

Guess where biotech vcs tend to raise their money? Largely the same places. But biotech fundraising is down. These same LPs are frustrated with "the long investment timelines, high degree of risk, and limp returns" of this sector. Many hotshot biotech VCs have fled to the safety of large investment firms, or the corporate development departments of large biotech companies.

Therefore what's actually happening in Boston is that traditional biotech investment is being somewhat supplanted by tech investors. You can see it trickle through the ecosystem: biotech venture capital fundraising is down > even good biotech vcs get pushed out > fewer investments in biotech startups > few successful biotech programs, whether they ultimately get acquired or they IPO.

This is the kind of thing that worries me because I'd rather have a few more life sciences companies than a few more Facebooks. But the Whatsapp startups pay off better (and faster) than the complicated pharmaceutical and medical device startups and ultimately this entire industry (startups) are an investment vehicle.
posted by 2bucksplus at 8:33 PM on February 27, 2014 [8 favorites]


Good nuanced view 2bucksplus. The dynamics of change in neighborhoods in the two cities have been clearly different - even if startups don't have the same constraints (access to laboratories, for example) that biotech has by necessity. Tech workers still tend to live in Somerville, Cambridge - and in the city of Boston, they seem to be more scattered across neighborhoods but still not living in places like Dorchester, Roxbury, Hyde Park . In this respect, the city of Boston is perhaps the opposite of SF - distorting rent prices and turning neighborhood class divide into a digital divide, instead of pushing people out completely. My feeling is that a neighborhood like Dorchester could use a little more tech attention, not less - even if it raises fear of gentrification if taken to an extreme.
posted by anelsewhere at 8:47 PM on February 27, 2014


It's worth noting that the tech sector in Boston — principally out on the Rt 128 corridor, if not so much downtown — predated Silicon Valley. It collapsed with the end of the minicomputer era, and most of the tech/engineering jobs evaporated or moved west. Now they're coming back.

So it'd be interesting to see whether this is really a new trend, or if it's reversion to the mean (or rather to a trend) that existed up until the late 80s / early 90s when all the air got sucked out of the East Coast IT industry.

I'm having trouble finding historic data for Boston specifically, but this chart of Massachusetts home values by decade, adjusted for inflation, shows a significant drop between 1990 and 2000, from $208k to $185k (in 2000 dollars). If you could find more granular data, my suspicion is that there's an upward trajectory that halted and reversed in the 90s that is just now recovering.
posted by Kadin2048 at 9:06 PM on February 27, 2014 [2 favorites]




The latest Glass update addresses this problem. Users are now able to issue voice commands that invoke the Google Brute Sqaud api beta. A specialized team will arrive in a street view van and attack the assailants on your behalf. The feature only works in the Bay Area for the moment, bt a rollout to LA and NY is rumored soon.
posted by humanfont at 9:17 PM on February 27, 2014 [2 favorites]


I'm so glad the Baffler is back to combat this Silicon Valley bubble-innovation garbage.

Thomas Frank & the Baffler were vital in calling out the hype of last dot-com bubble and I've sorely missed their voice over these last 5 years. Not that it will do any good when the bubble bursts horrifically within the next few years but it's nice to read now.
posted by willie11 at 9:18 PM on February 27, 2014


The Cambridge housing market has been screwed up for quite some time.

When I left Cambridge in 1998, the units in the triple decker next door to me on Franklin were renting for $1680/m. In contrast, the floor through Brownstone I moved into on S. 4th street in Williamsburg Brooklyn that was bigger (albeit dumpier), was $720/m.
posted by BabeTheBlueOX at 9:56 PM on February 27, 2014


'I was attacked for wearing Google Glass'

Given the revelations we've had from Snowdrn, I truly hope GG is made socially unacceptable. 24/7 spying on everyone you see is shitty.
posted by five fresh fish at 10:57 PM on February 27, 2014 [7 favorites]


I was like, 'Holy crap, I'm the target of their anger and hatred' - Google Glass wearer.

The shock is always real when inexpressible but massively powerful class conflict finds a way to the surface.

Like the Google Buses, Glass gives a physical form to the division of society between tech-enabled 'Innovators' and their servants, who purport to advance capitalism through the fair-and-square means of 'great ideas' on one side, while on the other are the army of humans that function merely as sources of surplus value through their labour. Just as the proles must remain hidden behind the factory gates in China, so also must this division of society be concealed behind the endless drivel of TED talks, rather than objectified in an object.

There are plenty of things that poorer people can't afford, but Glass (for the time being, until they price it like a smartphone) can only enrage them like this because of what it reveals about the endless, all-powerful bullshit of 'tech innovation' that these articles discuss.
posted by colie at 12:37 AM on February 28, 2014 [8 favorites]


The latest Glass update addresses this problem. Users are now able to issue voice commands that invoke the Google Brute Sqaud api beta

Competing service Übermensch rolls up in black SUVs.
posted by zippy at 1:37 AM on February 28, 2014 [3 favorites]


Death threats appear. Maybe Perkins was right. Or maybe we got some internet toughguys worked themselves into enough of a lather to actually do some IRL spraypainting.

I heard someone say this for Chicago, and I think it goes for NYC too: I want to see some of these fucks come up in here and try to start aggressively obstructing peoples' rights-of-way. You'd have to lay hands on people, and if you did then the 99% would hold you down for the 1% to work over.
posted by save alive nothing that breatheth at 6:07 AM on February 28, 2014


I'm having trouble finding historic data for Boston specifically, but this chart of Massachusetts home values by decade, adjusted for inflation, shows a significant drop between 1990 and 2000, from $208k to $185k (in 2000 dollars). If you could find more granular data, my suspicion is that there's an upward trajectory that halted and reversed in the 90s that is just now recovering.

There was a mini-housing bubble in Boston and some other parts of the country in the late 1980s spurred by a boom in condo development. The peak was 1990; home prices fell for the next three years before beginning to recover. I don't have inflation-adjusted figures ready to hand but the median home price did not surpass is 1990 peak until 1997-1998, for Suffolk County or the state as a whole.

The 128 tech boom/bust was part of it, but far from the main driver. Tech is just one of the important industries here, with education and health care being equally important players. Massachusetts also has a surprisingly large industrial sector (and a number of crumbling post-industrial cities).
posted by Diablevert at 8:14 AM on February 28, 2014


I tried to read that Baffler article as I sat in my East Cambridge dentist's office this morning, just past the line where the new Kendall Square meets old East Cambridge - I couldn't even get through it. Bored, in a waiting room, in the neighborhood it ought to focusing on, I couldn't get through it. Terrible article.

(BTW, if you really want to take of the rapidly rising rent in Camberville, stop turning triple deckers into "luxury" condos.)
posted by maryr at 9:31 AM on February 28, 2014 [2 favorites]


(BTW, if you really want to take of the rapidly rising rent in Camberville, stop turning triple deckers into "luxury" condos.)

Whether you left them as apartments of converted, the price would be up steeply over the past couple years. There are some luxury condo developments coming online in the next several years in Dowtown Boston, and there's Assembly Sq going up in Somerville, but whether that will take immediate supply pressure of Kendal is an open question...either way I doubt it'll do much for prices, a lot of the new condo towers are looking to get Manhattan-type prices from returning empty nesters and the parents of foreign-born students.
posted by Diablevert at 9:44 AM on February 28, 2014


Diablevert, I'm just still in shock over that "condo" on College Ave that's under agreement with an asking price of $989,000.
posted by maryr at 9:46 AM on February 28, 2014


Who knows what innovations will crawl from between the interlocked toes of the technology corporations, venture capitalists, physicists, chemists, engineers, and biologists now incubating in the nation’s creative class redoubts. Collaboration is the buzzword that sits tremulously like a fig leaf over the privatizing clusters in which America’s future is restarted.

Until those successful innovations make themselves known for surviving tests of validity, reliability, efficiency, ruggedness and so on, my peers and I in the public health world (here in San Francisco) have the notably un-fun job of trying to keep every hot new startup from wiggling itself into the very straightforward practice of public health for our fair region. Management, even in public health departments, is not immune from the draw of a savvy salesman telling them that, no, really, this app will change your world for the better.

And that's a big problem here. Huge amounts of capital are being directed into products and services that--very truly--may not really serve much purpose beyond generating capital for investors. Creativity is a great thing, but I hope we can agree in that very grown-up, not-fun way that the grown-up world needs that creativity to be directed into solutions for real, workaday problems for more people than find themselves in an investment pool. The future isn't going to be restarted by the nth iteration of a proprietary piece of code that better hones ad revenue for Lord and Taylor, despite the tremendous wealth Lord and Taylor would like to give to people who will creatively put that code together for them. I wish there were a way to put this that didn't sound so parental, but, goodness gracious, Innovation Economy, would that one could direct all this hyperactive energy into something that isn't just creative but also good.
posted by late afternoon dreaming hotel at 9:56 AM on February 28, 2014 [4 favorites]


Just for funnsies, I ran the numbers --- there were 70 $1M+ condo sales in Cambridge last year, 13 so far this year. 14 in Somerville. Central Boston had 490 last year, 132 so far this year. Most of the recent Boston ones seem to be Millenium Place.
posted by Diablevert at 10:02 AM on February 28, 2014


I'm trying to read it again. I just... I don't understand what this guy WANTS from Central Square. He's included a picture of "Zuckerstan" with a photo of a gas station and the Novartis building... A view that looks almost identical to 15 years ago when that photo would have said "NECCO" instead of "Novartis".

And, really, you're choosing a cancer research center at MIT (built on land previously occupied by... MIT) as one of your complaints? If it didn't say Koch would there be complaints here? What the hell kind of question is "If David Koch wants to cure cancer so badly, then why don’t his companies stop mass producing the chemicals that are known to cause it?" OK, sure. In the meantime, would you perfer that money going in to political campaigns? To the climate change denial organizations you mention?

I don't know. Maybe I benefit too much from the Inoovation Economy this article is railing against. I did go to MIT. I do work for a startup. I am from out of town. But trust me, I'm not making that sweet Zuckerberg money. My startup moved out to Medford. I moved out to Somerville and can't move within my neighborhood again because I won't be able to afford the rent. This article just reads like a rant to me. It's not that he's entirely wrong... it's that I can't tell what he wants to say other than Change Bad. The People's Republic of Cambridge has been dependent on its academic institutions and their well-off employees long before the 90s. Why do you think Harvard Square is so well developed? And for all his complaints about Kendall and Central, what does he think about Harvard and Lesley's continued development up toward Porter? Where are the complaints about the gentrification of Inman? Lechmere's a lot fancier than it was ten years ago too.

Now I'm ranting pointlessly. Again, the Baffler isn't wrong that Cambridge is changing. It's correct that affordable housing stock has been falling for quite some time now. Putting all of our money into "innovation" is a risky bet. But what should we be doing about it? Other than writing editorials.
posted by maryr at 10:06 AM on February 28, 2014 [1 favorite]


Huge amounts of capital are being directed into products and services that--very truly--may not really serve much purpose beyond generating capital for investors.

I thought that was the sole purpose of every tech startup? What else is there?
posted by colie at 10:27 AM on February 28, 2014 [1 favorite]


I feel like an outlier because I own a Somerville 2 family home and *haven't* turned it into condos. (I don't think they're "Luxury Condos" yet out in my section of town.)
posted by rmd1023 at 11:02 AM on February 28, 2014


There will be once the Green line hits, rmd1023. Sarma's placement is no accident.
posted by maryr at 11:22 AM on February 28, 2014


My favorite part of this piece:
These sound laboratory-like, all right, but sort of disturbing too, when you realize that the “Creative Economy” acknowledges only “the enterprises and people involved in the production and distribution of goods and services in which the aesthetic, intellectual, and emotional engagement of the consumer gives the product value in the marketplace.”

Here’s a definition broad enough to admit every form of “content” from web marketing to film, yet so narrow as to rule out the social conditions of sympathy, cooperation, and security in which creativity thrives—and never mind classic works of the twentieth century that were born in opposition to the market for consumer taste.
It's always bothered me that the whole tech/innovation thing seems to really just refer to things that play well with our current capitalist structure. Like, yes, innovate all you want, but never rock the boat...
posted by The Biggest Dreamer at 1:53 PM on February 28, 2014 [2 favorites]




'I was attacked for wearing Google Glass' - She said one of her assailants told her, "You guys are killing the city."

Glasshole Lies About Recording Bar Patrons on TV
posted by homunculus at 12:15 PM on March 14, 2014


Glasshole Lies About Recording Bar Patrons on TV
What a twit.
posted by unliteral at 5:07 PM on March 16, 2014




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