The Tech Industry Is Stripping San Francisco of Its Culture, and Your City Could Be Next

San Francisco
The skyline may look the same, but San Francisco is in the midst of a dramatic transformation, for better or worse, thanks to the tech industry. Robert Galbraith/Reuters

Last fall, a video was posted to YouTube of a confrontation between a group of Hispanic kids playing soccer on a public field in San Francisco's Mission District and a group of Dropbox employees telling the kids they needed to leave. The latter group had reserved the field through a new app. They had a permit and everything. The kids, who had been playing pickup ball at the field their entire lives, refused to back down. It was awkward.

The video gained traction online partly because Internet denizens love to watch entitled tech bros whine, but also because the tension on display epitomizes what has been happening in San Francisco since the tech industry exploded from a relatively niche movement enclosed within Silicon Valley to the paradigm-shifting phenomenon it is today. Companies like Airbnb have gone from startup to global powerhouse seemingly overnight. It was founded in the Bay Area in 2008, and by 2014 some valued the short-term rental lodging site at $10 billion; less than a year later, that valuation had doubled to $20 billion. Similar growth is happening throughout Silicon Valley, and with growth comes expansion, and with expansion comes more employees who need somewhere to live.

So flush has the Bay Area become with tech money and young transplants chasing it that the six square miles of San Francisco, once a haven for diversity and freedom of expression, have been taken over by developers. The city's once-vibrant culture has been paved over to cater to the sleek, homogenized tastes (and budgets) of a single demographic.

This transition is what filmmaker Alexandra Pelosi sets out to chronicle in her new documentary, San Francisco 2.0, which premiered this week on HBO. Pelosi, the daughter of House Minority Leader Nancy Pelosi, is a San Francisco native, and after attending a speech by economist Robert Reich about how cities are becoming gated communities, she decided to investigate the forces driving change in her hometown. Narrating the documentary herself and using a handheld camera to shoot it—as she did for her previous eight documentaries, beginning with 2002's Journeys With George—Pelosi speaks with startup employees, politicians, journalists and residents who have been displaced because of the influx of tech money.

For anyone paying attention, nothing in San Francisco 2.0 is revelatory. It serves more as an explainer to those unfamiliar with the dynamics of the Silicon Valley boom than anything investigative or damning. When I talk to Pelosi over the phone, she is careful to stress that she is not anti-tech. When she visits the offices of Dropbox, the company responsible for the bros trying to kick the kids off the soccer field, she doesn't ask CEO Drew Houston about the impact his industry is having on the community but instead marvels at the in-office perks his company offers employees, like a vending machine of free tech gadgets. Michael Moore in Roger & Me, Pelosi is not.

The documentary's strength lies in its view of the city's frustrated middle-class residents and how the newly wealthy have co-opted and sterilized cultural institutions like the 49ers, who have moved to a glitzy stadium in Santa Clara, and the city's famous Flower Mart, which is being taken over by developers. Pelosi spends time with a Mission District activist who laments the "soul being stripped" from the city, a Hispanic college student being offered a mere $2,000 to vacate his apartment to make room for more expensive housing, and a borderline retirement age veteran of the corporate workforce who lost his job during the recession and is now deemed unemployable because of his age.

Yes, she acknowledges that tech is good for the city and its economy, but seeing firsthand the impact it has on the community makes the complexity of the growing income gap apparent. "We have all this money coming in, all this tax revenue coming in, but at the same time there's a dark side because it's pushing people out," Pelosi says. "That's when you need real grown-ups to lead and say, 'We need to build affordable housing. We're going to make it fair for everybody.'"

San Francisco does offer affordable and inclusionary housing to residents making between 20 and 60 percent of the area's average income, but because of the widening income disparity between the wealthy and the middle class, affordable is often a misnomer because the mean income can skew high.

San Francisco 2.0 focuses solely on the titular city, but when we speak, Pelosi is far more concerned with the macro effect of the sharing economy that has stripped her hometown of its charm. Earlier this month, she went on Real Time With Bill Maher to talk about gentrification in San Francisco, but when she got home her inbox was flooded with emails from people from other cities telling her they were experiencing the same types of changes. This is very much a national phenomenon; it's just happening at an accelerated rate in San Francisco.

It's also not going to stop happening unless state governments can figure out a way to regulate the tech industry. "The government is so behind in the game," Pelosi says. "The tech companies are just light-years ahead. We have to somehow breach the huge divide between how fast the tech companies are moving and how slow the government is working to keep up and make rules that are enforceable."

Two tech behemoths that have not only disrupted but overturned their industries entirely are Airbnb and Uber—both of which have been fighting hard against legislation to restrict their influence. Backed by an army of the nation's best lobbyists and publicists, the car-hailing app has been fending off lawmakers on both coasts throughout the summer, as has the short-term rental lodging service. In November, Airbnb regulations will go on the ballot in San Francisco, with backers aiming to institute a 75-day limit on rentals, required reporting of data and the ability to take complaints to civil court if they are not rectified promptly by Airbnb.

Working to the tech companies' advantage, even more than lobbying power, is that, by nature, their business models exist outside of what government is accustomed to regulating. This means, to borrow a word from the tech world, legislators need to "pivot" and figure out a way to keep companies like Uber, Airbnb and countless others from disenfranchising the entire middle class, whose livelihoods are often dependent on industries the sharing economy is slowly rendering obsolete.

"You need to have rules, and everyone has to play by the rules," says Pelosi. "That's what this is all about. What are the rules and how are we going to get people to follow them? These tech companies are just making up the rules as they go along. That's great for them, but it seems like everyone else is getting screwed."

Just how governments regulate the complex business dynamics of tech companies will ultimately determine the middle class's ability to live in cities, because the sharing economy isn't going anywhere. Tens of thousands of the smartest young minds in the world are working tirelessly to ensure this is the case. Uber and Airbnb are the multibillion-dollar companies getting the headlines, but the real-world impact of tech innovation extends well beyond the housing and transportation industries, and its influence is becoming more and more pervasive. Just ask the kids playing soccer in the Mission District who were told their favorite field had been commodified through an app.