The housing dynamic in San Francisco raises the capital intensity of consumption. That contributes to an increase in the capital share of income and to the stock of wealth in the economy. Zoning restrictions are a tool of the oligarchy, effectively. I’m only one-fourth kidding. But they are; they are a means by which owners of capital extract an outsized share of the surplus generated by job creation.
So, what is to be done? Well, one option is simply to use the levers of government to seize back the surplus for redistribution to the masses. That’s not an ideal solution, in this case at least, as it piles nasty incentive effects onto the distortions already created by zoning restrictions. Better to fix the initial distortion, which takes us to the second option.
You could reform local institutions to generate better zoning outcomes. There are lots of good ideas for how to do this floating around. What is less clear is how one builds support for institutional reform. One shouldn’t say that it can’t be done, but first such ideas need to win intellectual battles, and then they need to win political battles, and so it is safe to conclude that such reforms represent part of a long-term strategy for improvement.
The idea is a simple one: create a private-public partnership to allow international entrepreneurs to come to Boston and be exempt from the restrictive H-1B visa cap. How is it possible to do this? The US Citizenship and Immigration Services Department (USCIS) has a provision that allows universities to have an exemption to the H-1B visa cap. Governor Deval Patrick announced today that the Commonwealth of Massachusetts will work in partnership with UMass to sponsor international entrepreneurs to be exempt from that cap, funding the program with state money to kick start what we anticipate will be a wave of private sector support.
Today, the picture is very different. Even in countries that are doing well, industrialization is running out of steam much faster than it did in previous episodes of catch-up growth – a phenomenon that I have called premature deindustrialization. Though young people are still flocking to the cities from the countryside, they end up not in factories but mostly in informal, low-productivity services.
But here’s the thing: Klein was right. Just as the big sell-side banks proved incapable of keeping up with the small nimble high frequency trading shops, big legacy media organizations are never going to be able to move with the speed and inventiveness of the best new-media shops.
...In general, the bigger and more entrenched the media company you’re part of, the harder it is to get stuff done. (I should know.) Klein had intimate, first-hand experience of the Washington Post bureaucracy, and he also saw the way in which Kara Swisher and Walt Mossberg managed to build a world-class franchise in AllThingsD, once they negotiated for themselves almost complete independence from their corporate overlords. They would never have had the same success had they been part of WSJ.com. What Klein wanted — and, ultimately, received, from Vox — was just the freedom to build something new and potentially amazing, outside the strictures of Marty Baron’s newsroom.