In Politico: Why Amazon, Facebook, Google and Apple are Bad for America

On Wednesday July 29th, Congress interrogated four big tech CEOs — Apple’s Tim Cook, Amazon’s Jeff Bezos, Google’s Sundar Pichai and Facebook’s Mark Zuckerberg — about the power that these four companies have over the U.S. economy and our society. In Politico, in advance of the hearing held by Antitrust Subcommittee Chair David Cicilline, ILSR legal fellow Shaoul Sussman and monopoly expert Matt Stoller articulate the implications of this investigation.… Read More

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Instead of the Big Apple, NYC Could Have Been La Grosse Pomme

How would it have been if America’s most populous city had not been called New York, but something completely different? Such is the question explored by a new documentary being screened in the city itself this month.

While many people are aware of NYC’s earlier incarnation as New Amsterdam, few know that New York City’s future site was, in the early 1500s, already given a previous European title by the explorer Giovanni Da Verrazzano—the French name Nouvelle-Angoulême (“New Angoulême”). Screening November 12 in New York’s French Cinema Week, the film If New York Was Called Angoulême featuring historian Florent Gaillard, glances briefly at this tantalizing, largely forgotten connection between France and New York. It invites the viewer to think a bit about how things could have been, if both the French name and the French themselves had just tried to linger a little longer.

This early French encounter with New York was brief, but striking. Verrazzano became the first recorded European to enter the Upper New York Harbor in 1524, on an exploratory voyage up the East Coast from Cape Fear. Anchoring somewhere within the Narrows that separate Staten Island from Brooklyn on his 50-man ship La Dauphine, Verrazzano told of how he was greeted by Lenape people, and described their territory as the “most pleasant that can be told, suitable for all kinds of crops: wheat, wine, oil.” As for the Lenape themselves, Verrazzano found them beautiful people “[who were] very generous and give everything they have. We have made a great friendship with them. … they live a long time and are rarely sick.”

These words—poignant with little hint of what would be Native Americans’ subsequent experience of conquest, warfare, expulsion, and death by epidemic related to European colonists—were addressed to the French King Francois I. For while Verrazzano was from Tuscany, La Dauphine was a French ship, sent across the Atlantic with funds from the city of Lyon. Sailing under French colors, the explorer thus baptized Manhattan “Angoulême” in honor of Francois, whose title before his coronation was Count of Angoulême, the name of a small city in Western France that still retains a good measure of historic beauty.

While such dedications were common at the time—New York also got its later name in honor of an English duke and later king—it still seems like a bit of a slap in the face to the deep-pocketed burghers of Lyon. Francois himself probably never read the letter, anyway, because when Verrazzano dispatched the news to France, Francois was busy languishing in prison in Madrid after being beaten in battle by his arch-rival, Holy Roman Emperor Charles V.

After this flurry of activity, the newly named land of Angoulême largely falls from history, with later chronicles of New York tending to prioritize Henry Hudson as a proto-founder. The English explorer sailing under Dutch colors tends to get star billing mainly because his 1609 voyage up the Hudson was actually followed by Dutch settlement in New York State five years later—though in days gone by, the fact that he was a WASP may also have helped promote his official recognition over a Catholic Italian. Indeed, it’s arguable that, until the naming of the Verrazzano-Narrows Bridge in 1964, Verrazzano’s great contribution to global geography was a mistake—namely his mis-recognition of North Carolina’s Pamlico Sound as the mouth of the Pacific Ocean, a misconception that endured in Europe for over a century. His imprint on New York is certainly slight to non-existent: the documentary has to make do with the carved stone fleurs-de-lys and salamanders—symbol of Francois I—that cover the front of Seventh Avenue’s Beaux Arts-style Alwyn Court.

Still, New York’s earliest European name lingers on somehow, as a tantalizing “What if?” What if Verrazzano had not just planted a flag, but actually founded a French outpost? What if the name he affixed to it had stuck? As French power in America’s northeast was extinguished in the mid 18th century, imagining a Francophone Grosse Pomme continuing up to today might be a bit of a stretch. But what if the French had chosen to settle and had held on to territorial control in the city for as long as the Dutch did? When they relinquished power in 1674, the colony of New Netherland had scarcely 4000 Dutch people in it. New York nonetheless ended up with a substantially Dutch-descended elite, a heavy scattering of Dutch place names, and the spoken language lingered on in greater New York City as late as the 1920s. If the French had been in place for as long a time, they might have likewise left the city with a distinct Gallic tinge, at least among its upper crust.

For the sanity of Americans living elsewhere in the U.S., it may be no bad thing that they didn’t—and that America’s Angoulême faded from memory. In the country that coined the term “cheese-eating surrender monkeys” to describe the French and invented the Freedom Fry, imagine how much more New Yorkers would be resented if they were not just considered pushy and brash, but also a little bit French.

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What’s Missing From Apple’s $2.5 Billion Housing Plan

On Monday, Apple announced a $2.5 billion pledge to finance housing initiatives in California. Deployed in partnership with the state, its plan is designed to improve both “affordability and availability” in California communities that have struggled to meet residents’ needs.  

State and business leaders applauded the tech giant for its philanthropic foray, which follows similar moves by Google, Facebook, and Microsoft on the West Coast. But housing experts and advocates are cautious about how much the company’s voluntary investment can do to budge the fundamental barriers to housing construction in the state.

For one, zoning restrictions and opposition from neighborhood groups may prevent developers from seeing through bold plans to expand housing, even once they’re given the sites to build.

“It’s really, really good to have money, and it’s really, really good to have land, but you have to get all the approvals to make housing a reality,” said Leslye Corsiglia, the executive director of the affordable housing organization, Silicon Valley @ Home. Until we can get the community to understand the need for more housing; we’ll be fighting an uphill battle.”

Most of Apple’s investment will effectively turn the company into a housing lender. The company will offer $1 billion in credit to the state and other developers to build very low to moderate-income housing. Another $1 billion will provide mortgage financing and down-payment assistance to first-time homebuyers, in tandem with the state government. The remaining $500 million will be spread across more local efforts, including dedicating land that Apple already owns in San Jose to building affordable housing, creating a Bay Area-specific housing fund, and supporting homelessness initiatives in Silicon Valley.

California Governor Gavin Newsom commended the company’s initiative, which was crafted in partnership with state officials. Newsom has set a goal of building 3.5 million units of housing by 2025; Apple’s is now the largest investment in housing among private companies that have recently pledged their assistance. “This unparalleled financial commitment to affordable housing, and the innovative strategies at the heart of this initiative, are proof that Apple is serious about solving this issue. I hope other companies follow their lead,” Newsom said in a statement.

Todd David, the executive director at the San Francisco Housing Action Coalition, said that the plan to supply $1 billion in loans to the state and other developers could prove useful in circumstances where officials can’t move public dollars quickly enough to purchase land for affordable housing. “Private funds have the ability to be faster and more flexible when opportunities come up,” he said.

The news of Apple’s investment comes after years of inaction by the iPhone maker to address regional housing pressures that it and other large Silicon Valley employers have exacerbated. As Apple, Google, Facebook, and other tech titans have turned into the richest companies in the world, the vast wealth they’ve brought to the San Francisco Bay Area has not been spread evenly. Highly paid workers pay top dollar for increasingly constrained housing supplies, while the construction of new housing has slowed to a snail’s pace due to construction costs, zoning barriers, and NIMBY-ish neighborhood resistance. In San Francisco, Oakland, San Jose, and some smaller Bay Area communities, a lack of low- and moderately priced accommodations is pushing out longtime residents and exacerbating homelessness, a pattern also seen in Los Angeles, San Diego, and other sought-after coastal cities.  

But Apple has been singled out as a uniquely visible contributor to the problem. It houses 12,000 corporate employees at its 175-acre “Spaceship” campus in Cupertino, which opened in 2017 with no connections to public transit lines or additional employee housing. Its approach contrasts with Google, which has a similarly sized real estate portfolio in the region but has incorporated housing and car-free transportation options into its new developments in San Jose. Facebook also has plans to house 35,000 employees in its upcoming campus in Menlo Park.

And Apple follows its Silicon Valley peers with its investment plan. In June, Google made a $1 billion commitment to open some of its land holdings to affordable housing developers. Last month, Facebook pledged the same amount to produce new units for teachers, police officers, and other middle-class workers, which followed the creation of a separate $500 million affordable housing fund by the Chan-Zuckerberg Initiative, the philanthropy founded by Facebook CEO Mark Zuckerberg and his wife, Priscilla Chan, earlier this year.  

But some housing experts and advocates say that the largest barrier to housing is not money, but political will. Pulling the right policy levers to transform those funds into more supply may prove challenging for Apple, even with the state’s support.

“A one-time investment is good, but we’re going to have this problem for a long time,” said Corisiglia. “It’s going to take a lot.”

Kate Vershov Downing, a former planning commissioner in Palo Alto who now sits on the board of the California Renters Legal Advocacy and Education Fund, said that the Bay Area’s housing problems are a result of “artificial scarcity.”

“Our housing crisis exists because almost all the land zoned for housing in Silicon Valley is zoned for single family housing only,” she wrote in an email. For example, in Palo Alto, only three percent of residential land is zoned for multi-family dwellings—the sort of higher-density development that affordable housing developers generally pursue.

Apple’s state-wide affordable housing investments are meant to jumpstart shovel-ready projects on surplus land; the company wouldn’t comment on whether it would nudge zoning rules or pressure lawmakers to expand that surplus.

That challenge is clear in San Jose, where Apple has pledged to commit about $300 million worth of land it already owns to new affordable housing construction. But the North San Jose property is currently zoned for commercial projects, and when the company first bought the space, San Jose Mayor Sam Liccardo says he expected Apple would fill it with research and development offices. Changing the land use regulations and getting approval to build will be an involved process, Liccardo said.

“We haven’t been able to build any housing in North San Jose in several years because of a legal settlement with some surrounding cities,” he said. The city is behind on its own goals to build 32,000 housing units in North San Jose, 20 percent of them affordable, in part because of the “red tape that’s choking development,” Liccardo said, referring to the neighboring City of Santa Clara’s resistance to building on their border.

Facebook’s housing plan, which was announced in October, included a similar pledge to Apple’s: It’s freeing up more than $225 million worth of land in its headquarters city of Menlo Park, where it says it will help build 1,500 units of affordable housing. But Facebook’s plot is already zoned for residential development, potentially streamlining the development process.

Liccardo says while he’s open to rezoning Apple’s newly earmarked 80 acres of land to accommodate homes, he would rather see the company build both dwellings and office space on the site. “We are certainly open to converting in very limited circumstances,” he said. “But I think what we’ll see emerge from this is that Apple will bring forward a Master Plan to build housing and jobs.”

Local advocates hope that the city embraces as much residential development as possible. “If Apple’s willing to step up and say, let’s use all this land in North San Jose—that’s well-situated for building affordable and work-force housing—it could be a huge opportunity for the city,” said Jeffrey Buchanan, the policy director of a local economic advocacy group, Working Partnerships.

In addition to expanding supply, Apple’s plan emphasizes assisting individuals looking to buy their first homes through mortgage financing and down payment assistance. In its announcement, Apple said it would work with California’s housing authority to target its aid at the “missing middle,” or the ”essential service personnel, school employees and veterans” who have been priced out of the neighborhoods they serve and who would most benefit from this kind of program.

But Salim Furth, an urban economist at George Mason’s Mercatus Center, worries that this fund may only exacerbate some of the problems fueling the housing crisis—creating a small group of winners who can afford to settle down, while leaving renters and anyone else who doesn’t receive financing help behind. “There’s an aspect of rearranging the deck chairs on the Titanic here,” he said. “You’re boosting demand artificially and telling people they should spend even more of their money on housing.”

He, too, believes that policy change is the most critical lever to increase supply. But, he adds, if you are going to make a private investment of $2.5 billion, “do it all on the supply side.”

Some critics take issue with the premise of this form of corporate philanthropy, however large. In a statement on Monday, Vermont Senator and Democratic presidential candidate Bernie Sanders ripped Apple’s pledge as a diversion from larger taxation issues. “Apple’s announcement that it is entering the real estate lending business is an effort to distract from the fact that it has helped create California’s housing crisis—all while raking in $800 million of taxpayer subsidies, and keeping a quarter trillion dollars of profit offshore, in order to avoid paying billions of dollars in taxes,” he said.

Last year, Apple made headlines for capitalizing on President Trump’s tax reforms with plans to repatriate some $285 billion of those offshore monies that Sanders referenced. It has also earned attention for its years-long battle to recoup millions in property taxes from Santa Clara County, where it is the largest property owner, and for strongly opposing an employee “head tax” proposed by the city of Cupertino to fund transportation initiatives, which was eventually shelved. Similarly, Facebook made its big housing pledge right as CEO Mark Zuckerberg was set to testify before Congress about a spate of regulatory and governance concerns related to the company. And last year, Amazon managed to overturn a Seattle “head tax” that would have raised $47 million annually to fund housing measures, opting to donate $8 million to fight homelessness instead.

Silicon Valley’s largest employers taking a stand on affordable housing could push local governments to reform some of the structural barriers in the way of production. The Chan-Zuckerberg investment came paired with initiatives that “preserve and expand housing” and strengthen tenant protections; though Apple’s plan doesn’t have a built-in policy arm, the company says it plans to hold governance committee meetings with the state to keep it on track.

But no one-time investment alone can change the structural roadblocks that zoning and NIMBYism present to housing. “If a company really wanted to make a difference with respect to housing, they’d put money towards supporting local and state level politicians who believe that the path to affordability and environmental sustainability lies in building housing next to existing job centers,” Downing said. “They’d also back propositions and bills that promise to do the same.”

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