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 10/21/12 -- Vallejo Police fatal shooting last night at 2404 Alameda St. makes number six. VPD Press release HERE.
VIB video interview of eyewitness will be up shortly. PLUS coverage of Mario Romero funeral including incident involving threat of gun violence.
Externalities:
How to shift your costs
and make someone else pay
By Frederika Bremer
10/19/12
This is an easy concept to understand. Envision throwing your dog poop over the fence into your neighbors’ yard for them to clean up. It is a key lesson taught in business school. Corporations belch hazardous waste into the air or into rivers so they can forget about it. Corporations argue that it is just too expensive to install pollution control devices because customers won’t pay the higher costs for the goods or services after adding all the extra costs. Savvy and well lawyered interests purposely look for poor communities in siting polluting industries because they are less politically adept. The promise of jobs they so desperately need right now seems more pressing than the possibility of cancer, asthma, birth defects and other health problems down the road.
Many corporations end run environmental laws by just moving operations to other countries…especially third world countries with cheap labor and no environmental constraints or labor laws. The band of maquiladoras in the Free Trade Zone along the Mexican border allows American manufacturers to significantly reduce labor costs and externalize hazardous wastes by dumping them in the New River which ends up in California’s Salton Sea. In the San Francisco Bay Region, powerful politicians at Federal and State levels who live in elegant San Francisco neighborhoods have long made sure that all the polluting industries are located well downwind in what is known as the cancer cluster along San Pablo Bay and the Carquinez Straits. We saw all this in action during the LNG debacle. San Francisco’s Bechtel Corporation, with their powerful political friends behind them, saw no real impediments to building an LNG terminal bringing 900’ long LNG floating bombs right next door to Vallejo. Vallejo is poor, no problem. They dangled the promise of jobs and they promised that the volatile fuel would NEVER blow up. Luckily most of the citizens of Vallejo were not so gullible.
Regional poverty programs are similar. In San Francisco, poverty is expensive. The homeless, mentally ill and criminals negatively affect the visitor experience required to bring millions of dollars into San Francisco’s economy. No visitor wants to step over a drunk or poop on the sidewalk. A mugging will ruin a tourist’s day. The Tenderloin is an officially designated Urban Containment Zone where the people that might affect the visitor experience are herded. Law enforcement is lax in the UCZ to make sure problems are not squished out to “better” neighborhoods. The sum total of the City of San Francisco’s policies creates a synergy that supports great restaurants, shopping and cultural venues that are enjoyed by both visitors and residents. The value of real estate relates to the high quality of life so rents in most neighborhoods are beyond the reach of low wage workers like the army of food service workers and other support service workers making minimum wage. For the extremely poor, like a single mother, minimum wage is not enough and the lure of subsidized housing, food stamps and other aid is irresistible. The cost/benefit ratio is pretty clear. Poor and other disadvantaged people don’t contribute much to the economy and they require a lot of social services that divert money from quality-of-life amenities that add to a wealthy community’s ambience. San Francisco and other wealthy communities have no place for disadvantaged populations or the felons being paroled from prison early. These people have to be externalized somewhere far away where they won’t impact the lifestyles in privileged communities protected by political muscle. Vallejo, an older industrial city, that once was the home of thousands of blue collar shipyard workers, meets all the criteria.
Real estate investment is a business and investors get involved because of the expected financial return. Investors don’t care about humanitarian goals. An investor can buy a very nice detached single family house now listed in one of Vallejo’s nicer neighborhoods for $142,000. Factoring all of the costs against the potential rental income, the net return on equity would be between 8 and 10% with no negative cash flow and reduced Federal income taxes. Investors who pick up foreclosures on the courthouse steps can do much better and HUD subsidized vouchers provide the best returns. This is a better return than that offered by banks, bonds, stock market or rental properties elsewhere. No wonder those BMW’s with out-of-town license plate surrounds are cruising Vallejo neighborhoods. But the taxes on that little house don’t contribute much to Vallejo’s tax base. “Disadvantaged populations” place an undue burden on public safety services, social services and the schools. Who pays? Many of the costs are externalized to the rest of the citizens of Vallejo in the indirect costs for security systems, property losses and reductions in safety. All of our costs are higher and our quality of life is lower. We drive out of town on highways paid for with our gas taxes to shop in wealthier suburban communities because the goods and services we need are not available locally. This is called sales tax leakage. People with kids either have to pay for private school or pretend they live in Benicia because Vallejo schools are overburdened with angry and unruly kids from underclass homes with no support systems or social skills. Our property values are lower so we can’t sell and buy an equal home in another Bay Area community. Vallejo’s tax base erodes and the General Fund can‘t pay for enough police officers to cover the increasing calls. The lax enforcement emboldens the real thugs because they realize the police are overwhelmed. Good citizens give up and leave continuing the downward cycle.
Urban Containment Zones are designated regionally to keep problem populations from squishing out and impacting wealthy communities protected by their political allies. Like San Francisco, the Napa Valley wants to make sure their visitor based economy is not impacted and the direct and indirect costs of housing their “disadvantaged populations” are externalized. While local political control is important, Vallejo’s fate is decided by HUD and ABAG guided by regional politicians and elites. The citizens of Vallejo don’t have any real voice in the matter.
Next: Vampire governments: sucking the life out.
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