California has the fifth largest economy in the world and San Francisco is one of the wealthiest cities on earth. It has a per capita income of $160,000 (£126,000), according to figures from the Federal Reserve. Yet this week, the department store Nordstrom announced it was shutting its outlets in the city, joining a growing exodus of big name retailers. What has gone wrong? And could the same go wrong in some of Britain’s cities? Matthew Lynn sounds the alarm in the Telegraph.
The retailer is hardly the first to put up the “closing down sale” signs. The upmarket grocery chain Whole Foods has shuttered a flagship store; the H&M, Gap and Banana Republic have all left. While some British high streets risk becoming boarded-up wastelands, they could soon look positively vibrant compared to what used to be known as “the golden city”.
There is no great mystery here. Under its ultra-woke Mayor, London Breed, San Francisco has been testing out a wide array of faddish, progressive policies. In the wake of the Black Lives Matter protests, Breed was one of the first to jump on the “defund the police” bandwagon, cutting $120 million from the law and order budget.
Sales and corporate taxes have been pushed up. Homelessness has been tolerated right across the city centre. Motorists reportedly leave car windows and doors unlocked to deter overnight break-ins.
Last summer, a groups of business officials wrote to officials threatening to stop paying taxes if politicians failed to clear litter from the streets and stop people from openly taking drugs. And the city was shocked by the death of tech entrepreneur Bob Lee last month. The revered executive was stabbed in a neighbourhood not far from Google and Instagram’s city offices.
The quality of life has deteriorated steadily in San Francisco, not least for those who cannot afford to escape to the wealthier suburbs. Businesses are shunning the city, perhaps deterred by an increasingly unfavourable local tax, social and regulatory environment.
In 2021, foreign direct investment into new projects in San Francisco fell to their lowest level since 2009. And as shops close, real estate prices are tumbling. Let’s not forget that one of the big reasons the San Francisco based First Republic Bank had to be rescued was because of expected losses on property loans. The city is slipping into a vicious cycle of decline from which it is hard to see any exit.
San Francisco’s problems might seem a long way away, but they could soon be mirrored here in the UK. We have no shortage of ultra-woke local councils, and devolved administrations, which are more interested in left-wing virtue signalling than providing decent services, keeping taxes down, or making sure the streets are safe and the rubbish collected.
In London, the mayor Sadiq Khan has launched a war on motorists with his Ulez charges, ignoring the fact that tradesmen need vans. The transport system is suffering catastrophic losses, in large part because of Khan’s economically damaging, if politically expedient, decision to freeze TfL fares in 2017. Violent crime is increasing. Climate protesters appear to have free rein to harass companies that are operating legally, and individuals as they go about their day-to-day business.
In Bristol, graffiti is almost everywhere you look. In Brighton, the rubbish remains uncollected for weeks at a time, while popular shopping areas have been closed to everyone apart from cyclists.
In Wales, the devolved administration has been bombarding retailers with demands for politically-correct measures, such as proposed ban on meal deals, which apparently are not healthy enough, even though to many students or people on low incomes they might be the only way of staying fed during a cost of living crisis.
Meanwhile, up in the SNP’s Scotland, companies have faced a blizzard of legislation, such as an absurdly complex charge for returning bottles, that along with higher and higher taxes, are steadily putting many of them out of business. The list goes on and on, and as Labour and Liberal Democrat councillors take power in more councils – and let’s keep in mind here that the Lib Dem are often far more woke than even their Labour rivals – it is only going to get worse and worse.
Worth reading in full.
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