San Francisco’s ruin is a warning to ultra-Left officials everywhere
Its tech industries are still booming. It is the financial hub for the whole of California, with the state now the fifth largest economy in the world. And it is home to some of the world’s biggest companies.
Add it all up, and San Francisco should be one of the best retail centres globally; an easy place to sell every kind of luxury good, fashion essentials and high end electronics. The money is there, as well as the people to spend it.
Yet this week, the department store Nordstrom announced it was shutting its locations in the city, joining a growing exodus of big name retailers. Household brands are in despair over the damage inflicted by an ultra-woke local government.
There is a warning here for many British cities, not least as left-wing parties consolidate their dominance following another set of disastrous local elections for the Conservative Party. Push businesses too hard, let crime run out of control, and eventually they will simply up and leave. It is happening in ultra-wealthy California, and very soon it could be happening in London, Bristol or Cardiff.
Nordstrom’s announcement was yet another blow for San Francisco’s battered retail industry. The company told employees it would not be renewing its leases at the Westfield Mall, nor at the Nordstrom Rack across the street, due to the “changed dynamics” in the city.
The “deteriorating situation in downtown San Francisco,” Westfield Mall told the Washington Post, has left both customers and staff unsafe.
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.
There is a lesson in the closure of Nordstrom in San Francisco. It is one of the wealthiest places in the world. It has a per capita income of $160,000 (£126,000), according to figures from the Federal Reserve. That is way above anywhere in the UK, even for the ritzier parts of London and the Home Counties.
It is often complacently assumed that businesses will just take any amount of punishment so long as there are still customers with money to spend. You can push taxes up to any level you like, let crime run out of control, turn the streets over to vagrants, and impose as many virtue-signalling rules and regulations as you can think of, and they will stoically put up with it all because they need the market. San Francisco is a warning that that is simply not true.
There is always a final straw. That was true of Nordstrom and the golden city. And very soon it may be true of many cities in the UK as well. Ultra left local governments can destroy even successful cities – and once it starts it is almost impossible to reverse.
