Dot Com to Dot Bomb Shift Wreaks Havoc on State, Bay

By HILARY ABRAMSON Pacific News Service
Friday August 08, 2003

I know where you can get a barely used $1,200 Aeron chair for less than $400. Here—where the high-end icon for dot-com rear ends was scattered in minimalist, million-dollar lofts like a flock of black butterflies. 

Of course, that was three years ago, before there was a “before” and “after” in America.  

When anyone in this city who wanted a job could find one.  

When you needed reservations weeks in advance at restaurants that served $500 bottles of wine and $16 foie gras ravioli appetizers with lobster truffle cream to entire staffs under the age of 35.  

When landlords expected to see a trail of people with references and cash lining up for a $4,000/month, large, two-bedroom, two-bath “with view” (without garage). 

Today, we can thank the U.S. Census Bureau for confirming what we knew anecdotally—San Francisco has lost a higher percentage of residents than any U.S. city with a population of 100,000 or more.  

And for the first time in its history, more people are leaving California for other U.S. states than are coming to it from other U.S. states. As one city tabloid wrote, Baghdad by the Bay has “joined weary old factory towns like Gary, Ind., and Hartford, Conn.” 

Blame it on the Dot Bomb—an economy built on hype that collapsed with the high-tech implosion. While the state capital and Central Valley enjoy a rollicking growth spurt, California as a whole has a higher unemployment rate than the national average. A report from the Federal Reserve Bank of San Francisco concludes that California's dismal economy makes up the bulk of the nine-state Western regional problem.  

Everyone you know can name people they know who have been unemployed more than a year. (The Committee on Jobs estimates a three-year loss of 100,000 jobs since the end of the city's technology industry boom.) 

Blame it on the “yuppification” of San Francisco, where high-end businesses forced out mom and pop shops and inflated rents and home prices drove out families. What might be called a garage in Sacramento was a $500,000 “fixer-upper” in San Francisco at the height of the froth. 

In those days, every morning delivered material for fresh rage: the young driver weaving in traffic in a new, silver, BMW convertible at twice the legal speed while talking on her “cell”; the super young in black Prada, Kate Spade bags and Manlo Blanco stilettos; anxious twenty-something everybodies who hired walkers for their dogs, nannies for their children, cleaners for their houses and complained how hard it was to keep it all together. 

Three years ago, when I was facing knee surgery and zero parking nearby due to utility district construction, I asked the next door middle-aged financial consultant if she would park her vintage, burgundy Jaguar in her driveway to free up some street parking. The most I knew about her was that a staff of young, thin people dressed in black entered and exited her front door at all hours. And that, when she moved in, she had asked us to transfer our Solari bells to the other side of the deck because they kept her awake. 

“I paid $1.4 million for this house so that I could park anywhere I want,” she said with a big smile. 

“Then, could I park in your driveway so I don't have to limp for two blocks?” I asked. 

“I paid $1.4 million,” she repeated cheerfully, “so that I could look at my garden without having a car in the middle of it. But thanks for asking, because if you hadn’t, you wouldn’t have known the answer.” 

Dumbfounded, I told her that I was glad I asked, because otherwise I might have thought she was a good person.  

Afterwards, my biggest concern was over karma, because my husband, muttering that he was from New York, stomped out and hung the chimes back on her side. 

Today, some of us—even those of us who have been laid off for the first time in our lives—have had some positive sightings. The princes and princesses of smug have returned home to mooch off mommy and daddy until they can get into grad school and work their way up.  

Nonprofit organizations that had to leave town to find affordable downtown space are negotiating months of free rent in wired offices they could once enjoy only on magazine pages.  

Since the second quarter of 2001, the average Bay Area residential rent has fallen more than 18 percent. And the hottest new restaurant is “Home,” where you can get a heaping plate of tasty comfort food for as little as $10. 

These days, the woman next door and I exchange civilized nods. Her assistants have disappeared into the fog. Commuters barely remember gridlock.  

But sunrise lines of latte lovers, once united at Starbucks in exhilaration, now stand quiet and tense, living moment to moment in free fall. 


PNS contributing editor Hilary Abramson (hilary@pacificnews.org) is a veteran California journalist and former staff writer for the Sacramento Bee.