At a recent house party, a girl too drunk to be there leaned into me and murmured the speculative net worths of the people in the room, gesturing softly with her finger: “A few thousand. Broke. Can’t be more than a hundred thousand. Millions, I think.”
At the same gathering, a man fact-checked something I said about local politics by taking out his phone and typing it into ChatGPT. He angled his phone towards me just before the little white ball spelled out: “Yes, it’s plausible.” I was right.
After hovering through a few conversations about the AI revolution, in which I was mostly outed as someone not working in AI or even in tech, I glanced at the bookshelves around me — a lot of Isaac Asimov and faddish tech-sponsored print magazines covering “the future of governance and society”.
I’d had enough. My friend said a driverless Waymo could arrive in three minutes, and we took it. On our way home, we passed a bus stop advertisement that curtly read: “Stop Hiring Humans.”
San Francisco looms large over the American imagination. Even I succumb to its mysterious promise from time to time, but seldom for very long.
The city is the indisputable tech capital of the country, but the majority of its workers do not work in tech. It’s difficult to estimate the true percentage of San Franciscans employed in the industry, but in 2021, one survey concluded that tech comprised 18.7% of all jobs.
It’s quite a loud fifth of the population, judging by the conversations I overhear in cafés (almost entirely about stand-ups, funding rounds, and coding exams); or the number of times I’ve waited for a trolleybus to arrive, only to discover a blacked-out private bus for tech employees using the same stop. Today, college students drop out to inhabit vacant apartments in “Cerebral Valley”, friends relocate via gig economy apps, and billboards broadcast a tech-infused language unintelligible to most of the city’s residents.
Yet I’m left wondering if ordinary San Franciscans will benefit from the boom, or if the city's newfound wealth will remain concentrated among an increasingly tiny class of digital oligarchs and venture capitalists. At parties fuelled by high-end champagne, White Claw and McNuggets, any number of evangelists will offer prophecies of prosperity. But are we heading for fully-automated luxury communism or the Depression-era Hooverville version? No one here can really tell me, but still they sprint full-speed ahead.
At another recent party, I noticed both Richard Rothstein’s The Colour of the Law and Peter Thiel’s Zero to One pressed against each other on a bookshelf. The host, who I gathered had created an app or a website more than a decade ago and long since cashed out, seemed eager to extend his technical expertise to larger societal problems. For many well-heeled people in tech, it’s an increasingly popular transition.
Across America, the tech and AI oligarchy has never held more political sway. Its influence is clear in both national and local administrations — from prominent national figures like Elon Musk and Thiel-backed Vice President JD Vance, to local leaders in San Francisco like Mayor Lurie and Supervisor Bilal Mahmood, who were both elected with significant support from tech-backed groups. Now liberated from regulatory concern, the industry is free to advance on a path paved with gold.
As it so happens, that golden path often veers rightward. San Francisco’s legacy of hippie counterculture and radical leftist idealism, long reduced to a nostalgic shadow, is more distant than ever. So too are the mythical days of “woke retreats” at Google, where you could unpack ableism while collecting a six-figure salary.
Instead, local money is now lavished on centrist and right-wing pressure groups — such as GrowSF, Abundant SF, Together SF, and Neighbors for a Better San Francisco — which have in the past four years fundraised over $50 million from conservative tech and real-estate elites. In the industry’s social scene, tech founder Eoghan McCabe's “San Francisco Freedom Club” recently host a party for more than 600 individuals passionate about “freedom, America, technology, capitalism, humanity, merit, and growth”. There, people could discuss the city’s new crop of hyper-local, techno-optimist magazines covering the “long bitcoin future” and the construction of a “Freedom City” in the Presidio national park.
Tides are turning here both locally and nationally. The city is more than just a testing ground for autonomous vehicles.
For all this technological determinism, there are still pleasant aspects of ordinary life in San Francisco. On those afternoons so thick with warmth and sun that the restaurants overflow onto Valencia Street, it’s hard not to pause and glance down the busy block. To the south, the round arc of Bernal Hill emerges above the avenue; to the north lurk a few downtown skyscrapers. In between, meanwhile, are countless pastel Edwardians, dusty used-book stores, exactly two coffee shops where the baristas know your name, and a dive bar frozen in the 1970s, where you’ve yet to lose a game of pool against a stranger.
You might expect a tech dystopia to be a harsh environment of glass and concrete, but the forgotten majority of the city is a resplendent paradise of urban landscaping. When you meet friends in the park later that afternoon, to eat bánh mì and drink Mexican beer, the perennially green pastures feel eternal and undisturbed by the economic forces that surround them.
Ironically, the parks here are covered in eucalyptus trees. Not only are they not native to the area — their shallow roots make them a terrible choice in a city known for its earthquakes.
I’m an economic and public policy analyst of climate issues, which makes me somewhat of an outsider to the city’s loudest industry. I unexpectedly moved here two years ago from Chicago, after my boyfriend’s PhD advisor relocated to the Bay Area and compelled us to move with him. Despite the surprise, we came with open minds.
Many of my first friends here were through pandemic-era Twitter connections and their extended circles, both inside and outside the tech world. I’ve attended some rather tech-optimistic parties, out of a mix of curiosity and a desire to meet new people, and met some sharp and thoughtful young people. However, I’ve increasingly realised many of these parties serve as distinct epicenters of an unsettling discourse, as tech grows more powerful politically and economically.
“I’m hopelessly utopian,” an actor closely resembling OpenAI’s Sam Altman says in Matthew Gasda’s play Doomers, which depicts the 2023 boardroom struggle that nearly ousted him. Another actor replies: “Well, utopians don’t have a very good track record.”
One must wonder if the transformative promise of AI can materially improve the daily lives of those outside it — in ways beyond making white-collar jobs more efficient. The industry’s own success narrative is questionable: AI agents perfectly emulate human workers, companies deploy that technology to “complement” rather than replace human workers, low-level data scientists seamlessly transition into prompt engineers, and Artificial General Intelligence (AGI) decides to invent a bunch of cancer drugs instead of breaking free from human control.
But how will this narrative address the needs of hundreds of thousands of San Francisco workers, who may never see the profits from said cancer drug? Walk past bar after bar selling $19 cocktails, and one starts to wonder: Have utopian narratives always relied so heavily on trickle-down economics?
Nothing captures this tension so well as the startups, venture capital hawks, and big tech companies that simultaneously dangle the possibility of AI-powered prosperity while announcing lay-offs at their own firms. The tech industry is currently an ouroboros, eating itself. AI is more advanced than ever, but software engineer job postings are at a five-year low. My friends have told me they've avoided new hires at their startups because of advances in LLMs: “I told my boss to cancel the role because I can build the app without another engineer,” said one.
On the one hand, I am sceptical that I will ever have a handheld, intelligent butler who tells me how to structure my daily meetings and whether I should quit my job to pursue what I’m truly good at: drinking expensive iced coffees and forgetting to call my mom.
But on the other, how can I not fear the impacts of AI, when businesses were so quick to outsource work, even entire teams, to foreign countries? How can I not fear that my salaried job will one day be considered “redundant”? Will all my voice and historic knowledge and Chipotle desk lunches be deemed useless against an ethereal agent that can make Excel pivot tables a bit faster than me? Perhaps the most concerning question isn’t whether AI will deliver a utopia, but whether businesses will behave as though it can.
Despite tech companies’ lack of enduring financial stability, the City of San Francisco is pretty reliant on them. In 2022, the largest five taxpayer firms — presumed to be tech firms, although the city will not name and shame them — paid 24% of the city’s business taxes. Between 2011 and 2019, San Francisco’s “Mid-Market Payroll Tax Exclusion” offered hundreds of millions in tax breaks to companies like Twitter, as it was then called, to encourage them to relocate their offices to neglected downtown spaces, promising a win-win of keeping tech in the city and revitalising a corridor on its way towards blight.
And then the pandemic happened, resetting the area to its most abandoned conditions while the tech companies still pocketed hundreds of millions from the city.
It’s an expensive reliance that will do little to remedy San Francisco’s own polycrisis. Both the city’s public school system and transit systems are crumbling and underfunded, and its housing and homelessness crises remain existential. According to the most recent count, more than 8,300 individuals are experiencing homelessness, a 7% increase from 2022. As for those who do have a roof over their head, the median down payment for homes in San Francisco is around $375,000. San Francisco is a beautiful city, and one that teems with billionaires, but it is still not a place for easy, sustainable living.
Without the benefit of having a multibillion-dollar valuation from a venture capital firm, the rest of us are left to hunt for bargains of our own, as I have in the apartment-rental and cheap-after-work-dinner fields. If you need my services, I can find you a below-market one-bedroom (without some of the lesser-important amenities like a refrigerator). Or I can show you where to find an inflation-defying steak burrito for less than $10.
But such solace is short and sweet. Outside of these limited scenarios, the tech world compels many of us to define ourselves either in lockstep with or in opposition to it, as its tendrils permeate even neutral spaces like coffee shops and bars. And as much as I’d like to relate to the tech world neutrally — most of the people I’ve met working in it are kind, funny and clever — it has grown so large that today’s economy can’t survive without it. A tech crash wouldn’t just mean a higher unemployment rate; it would also devastate local businesses and public services. Empty offices, empty coffee shops around those offices, empty balance sheets for coffee beans, and so on.
According to a recent report in the Wall Street Journal, the top 10% of earners in America now account for 49.6% of the country’s spending, up from 36% three decades ago. This economic reality, where the spending of the ultra-rich upholds the entire economic system, fosters a strange relationship on the ground. In this awkward equilibrium — a status quo of reliance and mutual disrespect — local businesses like Mixt adapt to sell $23 salads to those who can afford them, while city agencies fight to attract the educators, workers and artists who give the city its character and function.
The result is something like a city split into two: one side marked by its utopian visions of abundance, the other strained by pragmatic concerns around housing, transportation and livelihood. Like the eucalyptus trees that dot Golden Gate Park, both sides wait for the inevitable earthquake — hoping the future promised on billboards and whispered about at parties eventually arrives, or doesn’t arrive, for them too.
Rachel Dec is an economic analyst and writer in San Francisco. She writes about economics and culture on Substack and tweets at @rachdele.
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