What Happened to San Francisco, Really? (2024)

In the past few years, accounts of San Francisco’s unravelling—less like a tired sweater than a ball of yarn caught in a boat propeller—have spread with the authority of gossip or folklore. As the pandemic recedes, nearly a quarter of offices downtown are said to be vacant, the worst rate in the nation. Drug-overdose deaths are surging; reports of theft on downtown streets, including an almost two-hundred-per-cent increase in car break-ins in 2021, have crossed the national media to censorious response. “They took down the guardrails around personal responsibility,” the Wall Street Journal columnist Daniel Henninger declared on Fox News. In May, a local pet owner claimed that her Himalayan sheepdog began “wobbling” after eating feces possibly containing opioids and marijuana. Throughout the summer, Presidential hopefuls came to town to stand on grim street corners and record their horror for the cameras. (“It’s really collapsed because of leftist policies,” Ron DeSantis repined in his spot. Robert F. Kennedy, Jr., lamented the many Americans who “are on the precipice of ending up on a corner like this.”) Nine years ago, when HBO premièred the series “Silicon Valley,” a deadpan comedy lampooning the Bay Area’s life-style blandishments and hapless global power, the city seemed to exist in a helium balloon, floating ever upward. Now the same place is viewed as an emblem of American collapse.

The change has been unsettling because the city’s broad project is widely shared. Since the end of the industrial period, the main path of the U.S. metropolis has been what’s often called urban renewal: transforming old frameworks into beautiful, dynamic settings for prosperous middle-class life. No city excelled at the assignment more than San Francisco. It invested in lush, landscaped parks, tree-lined boulevards, and world-class museums where there had been none. It grew rich, and seemed to climb out of the Great Recession with both influence and a mandate. “There’s a lot of pent-up envy of San Francisco from a lot of other cities that think of themselves as more important,” one local told me recently. For a long time, that envy inspired mostly emulation. Universities spent millions to reorient themselves around the Bay Area’s style of thinking. Success across industries today is measured by virality, optimization, and unceasing growth. In San Francisco, the nation saw its dreams, and now it thinks it sees its nightmares. The question is what caused so swift a change.

A new story described widespread flight. Downtown San Francisco has seen its highest retail vacancy rate since 2006. In the past few months, Christian Louboutin, Lululemon, Nordstrom, Old Navy, and Williams-Sonoma all began an exodus from the area; so did Office Depot and Whole Foods. In late summer, the owner of Gump’s, an upscale shop that opened in the eighteen-sixties, released a testy open letter, threatening to close in response to “a litany of destructive San Francisco strategies, including allowing the homeless to occupy our sidewalks, to openly distribute and use illegal drugs, to harass the public and to defile the city’s streets.” Urbanists had already begun to circulate a paper by the economist Stijn Van Nieuwerburgh that traced a post-pandemic spiral of collapsing retail and declining safety leading to less public revenue and fewer public services—what he called an “urban doom loop.” The phrase became a shorthand around town, where many took it as Cassandra’s vision of their fate.

One afternoon in June, I went to see Sarah Dennis Phillips, the official charged with rehabilitating San Francisco’s businesses. “I’m confident,” she said. “It’s just a question of how long it takes.” A few weeks earlier, she had been appointed the executive director of San Francisco’s Office of Economic and Workforce Development—effectively, the trauma surgeon for downtown—after a career spent bringing the downtowns of small, quiet, boring Northern California suburbs to life. Of one city, Livermore, she explained, “We had to create a ‘Right to Live Downtown’ ordinance that everyone moving into a residential building would sign, acknowledging they would not get upset that things weren’t quiet at 7 p.m.” Now she faced the inverse problem: a city worried that its downtown was too quiet.

On her first day on the job, it was announced that the lender for the largest mall in the district, operated by the Westfield corporation, would retake possession of the property—a five-story retail center with spiral escalators, opposite the city’s most famous cable-car landing. “We knew Westfield would be a challenge to deal with,” Dennis Phillips told me, in a loud café near City Hall. People all around us were absorbed in their phones and laptops, poring over the day’s work. “We just didn’t know that it was going to happen this fast.”

The city’s downtown has experienced slumps before. In the seventies and eighties, San Francisco, undergoing what was then described as a wave of drug use and crime, saw a series of exits to the suburbs. Skyline disputes—sparked in part by the city’s tallest building, the Transamerica Pyramid, and drawing on fears of “Manhattanization”—produced an over-all square-footage cap, which constrained growth. In a new book, “Portal,” the urban-design critic John King recalls the bitter year of 1983, when the city’s mayor, Dianne Feinstein, faced a ballot recall instigated by a far-left group called the White Panther Party. (Feinstein sought to ban handguns; the White Panthers believed that poor residents needed them for self-protection.) Remarking on the city’s air of terminal insecurity in those years, King describes “a pessimism that was more than a match for detailed land-use plans.”

“We knew Westfield would be a challenge to deal with,” one city official said of the downtown mall. “We just didn’t know that it was going to happen this fast.”

In the wake of a global lockdown, downtown pessimism had a different tone. Before the pandemic, thirty-eight per cent of San Francisco’s office space was occupied by the technology industry. “We no longer manufacture things in San Francisco to speak of,” Rodney Fong, the president of the city’s Chamber of Commerce, told me. “We’re the first to see our downtown as impacted as it is, because when we said ‘Work from home,’ everyone just grabbed a laptop, and boom!” That reliance on tech made downtown especially vulnerable.

Dennis Phillips’s mode is crisp and cheery, and, as we sat in the din of the café, she mentioned that she had been reading “Survival of the City,” by the economists Edward Glaeser and David Cutler, and “The New Urban Crisis,” by Richard Florida, a book about displacement and inequality. More than anything, she was trying to balance San Francisco’s grand narrative of its downtown as a techno-futurist Atlantis against a new story of downtown as a great, fun spot to open a small, quirky retail business. “If downtowns aren’t a place you have to be, then they have to become places you want to be,” Dennis Phillips told me. She had been studying communities that turned their stories around—formerly depressed cities like Nashville and Detroit that had shown an aptitude for “constructing that narrative that makes people want to come.” “It’s a new muscle for San Francisco,” she said. “We’ve never had to do that before.”

San Francisco is the capital of social media, streaming media, app tech, the sharing economy, the gig economy, and other building blocks of modern life. It can measure its influence in dollars: the city, whose early industry harvested outlying gold, silver, and timber as the heart of what the architectural historian Gray Brechin has called the “imperial” West Coast, remains the fifth-largest metropolitan economy in the global Organization for Economic Cooperation and Development.

But the city’s influence can also be measured by its long shadow in Democratic politics. San Francisco, it’s easy to forget, is a small city, approximately seven miles long and wide—the distance from the World Trade Center to the top of Central Park. Its social sphere is startlingly compressed. One day, I stopped in a coffee shop to send an e-mail asking for an interview and, seconds later, heard a guy reading his phone across the room exclaim, “The New Yorker magazine wants to talk to me!” From this tiny ecosystem the political careers of the nation’s Vice-President, the governor of its most populous state, the recent longtime Speaker of the House, and (until last month) the most senior Democratic member of the Senate emerged. The city’s politics can seem preternaturally charged.

“You might have heard of a book called ‘Fifty Shades of Grey,’” Joel Engardio, a slender, balding, bearded man in his early fifties and a supervisor for San Francisco’s Sunset District, told a crowd a few weeks ago. He wore a blue blazer, with a Board of Supervisors pin on his lapel. “The story of San Francisco politics could have a similar title: ‘A Million Shades of Blue.’ You see, Democrats in San Francisco like to inflict sad*stic pain on each other.”

Engardio, who was elected last year to the Board of Supervisors, an eleven-member legislative body that governs both the city and the county, teaches a monthly public class that he calls S.F. Politics 101. His slide-filled lecture surveys the city’s history—gold, jazz, gay rights—and lands on what he considers the partisan conflict at the heart of San Francisco politics today.

“We have two dominant shades of blue—progressives and moderates,” he said, pointing at a slide. “Now, a San Francisco moderate would be considered liberal anywhere else, and a San Francisco progressive would be considered super far left anywhere else. In San Francisco, they’re both Democrats. But they spar as if they were opposing political parties.”

“Honey, could you take the kids away? This next assembly step warns of serious profanity.”

Cartoon by Edward Koren

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Engardio identifies as a moderate—he believes that “we need to roll out the red carpet and cut the red tape” for tech and small-business development—but he began teaching the class, he explained, to help voters contextualize their choices. “I see it as a fun and joyful thing on the surface, but underneath it’s addressing some actual issues,” he told me.

One major actual issue at play in town right now is public safety. As downtown emptied out with the lockdown—“not a single f*cking person on our streets!” another supervisor told me—certain genres of crime flourished. Smash-and-grab operations, in which car windows are shattered and valuable goods are extracted in seconds, usually alongside a running getaway vehicle, had been the bane of parked cars in San Francisco for several years. During the pandemic, the same practice was used to rob storefronts, spiking property-crime levels to forty-one per cent above the national average. Meanwhile, fentanyl, cheap and lethal, exploded in street sales. According to an eighteen-month investigation by the San Francisco Chronicle, that surge was tied to well-run Honduran cartels, some of which sold meals to dealers out of car trunks so that they didn’t have to leave their posts. (In the spring, Representative Nancy Pelosi, whose district encompasses most of the city, requested special funds from the Justice Department to investigate; no major federal arrests have yet been made.)

“The pandemic and fentanyl collided,” Lydia Bransten, the executive director of the Gubbio Project, which offers coffee, health services, and a safe place to nap to a hundred homeless people a day, told me. Congregate shelters were at severely reduced capacity. “People in the throes of addiction were hanging out with other people in the throes of addiction without the rest of the community. Then the city reopened, and housed people coming out of their homes were confronted with this scene of absolute devastation. And they’re flabbergasted: ‘How could this happen? We’ve spent all this money!’” From 2021 to 2022, San Francisco spent seventy-six million dollars on drug-treatment programs; its homelessness budget was nearly seven hundred million dollars. (New York City’s was $1.4 billion, for about ten times the urban population.) From Bransten’s perspective, the lockdown was an experience of absolute damage control, with winnowed ranks of care workers, like her, scrambling to protect a poor and unhoused populationfrom the worst of a deadly pandemic. But after living through their own pandemic challenges, people had what Bransten calls “compassion fatigue.”

“It was a feeling of ‘Look at these people. Clearly nothing’s working,’” she told me. “So we’ll police them, arrest them, detain them, and charge them.” The proper role of law enforcement on the street has long been a debate across the moderate-progressive divide, but in recent years—first with the Black Lives Matter movement, then amid pandemic-era concern about crime—the topic has engulfed the city’s politics.

“We have an understaffed police department,” Matt Dorsey, the supervisor for the South of Market section of downtown, said, citing a shortfall of seven hundred officers. Dorsey, a former police-department spokesperson, had the idea of adding fentanyl dealing to a list of crimes for which undocumented immigrants lose their sanctuary-city protections. “My hope was to incentivize a change to the drug market—if we went back to the good old days of heroin and Oxys, we’ll save hundreds of lives every year,” he said. “It didn’t go over well with my colleagues.”

Last year, a magistrate judge filed a temporary injunction declaring that, until San Francisco met its deficit of shelter beds, law enforcement couldn’t compel anyone who was involuntarily unhoused to move off the street. The rule, which was intended to encourage construction, riled the retail and hospitality trades. “We’ve got to take the handcuffs off the cops so that they can help these people get up off the sidewalks,” Brian Sheehy, who has opened a series of popular bars downtown in the past twenty years, told me. “San Francisco has to get back to being a destination.”

This year, the mayor’s office signalled that it was emphasizing an enforcement philosophy (the idea that drug use is a crime) rather than relying, as it had in the past, on a harm-reduction philosophy (the idea that addiction is a disease). And the police have received a resource boost. In March, by an overwhelming majority, the Board of Supervisors passed the mayor’s request for a midyear increase in police overtime funding of twenty-five million dollars. One of the two dissenting votes, the democratic-socialist supervisor Dean Preston, told me that he saw the request as a cynical effort to use worries about crime to direct cash toward an already overfunded department.

“That twenty-five million was in addition to a fifty-five-million increase last year, and a sixty-million increase this year, and a memorandum of understanding that approves a one-hundred-and-sixty-seven-million increase over the next three years,” he said. In pushing for that funding, politicians had highlighted the Tenderloin—part of Preston’s district, and the poorest, densest neighborhood in the city, with the most street homelessness and open-air drug use. But the extra money, he found, wasn’t for more policing there. Much of it covered shopping and tourist areas.

“When I walk by a luxury hotel downtown and I see four police officers standing there—just standing there, for hours—and then I walk four blocks away, to the Tenderloin, where I have a merchant who’s, like, ‘Why is there no beat cop walking around here?,’ I would challenge any leader to look that merchant in the eye and say, ‘Oh, it’s because we have too few police officers,’” Preston told me. In the spring, he commissioned an audit of the police budget; it is pending. “I mean, we still fund, for millions of dollars, a mounted horse unit.” He looked at me incredulously. “We just bought a new horse! In San Francisco! A dense urban city!”

By a month and a half into her new job, Dennis Phillips had propped up a giant whiteboard in her office, in the bowels of City Hall, and divided it into three columns: “PRIORITIES,” “DOING?,” “WANT TO DO.” When I visited her, one afternoon, the board was covered in ideas. “We’re in a bit of a period of experimentation,” she told me, looking at the scrawl a little dazedly.

Given San Francisco’s dearth of housing and glut of offices, many people had raised the possibility of residential conversions. “It is not an easy task, but one that other cities have done with regulatory changes and financial incentives,” Rich Hillis, the city’s planning director, told me. In July, the mayor sent a letter inviting the University of California system to create a new campus downtown. Still, Dennis Phillips noted, many conversions would likely cost more than developers could expect to earn, making it a hard sell: “It’s only twenty per cent of our strategy downtown.”

The mandate for downtown included tax incentives and bureaucratic guidance to help get small businesses going, as well as placement services to drop pop-ups into storefronts and employees into jobs. In July, when Sapporo announced that it was shuttering the Anchor Brewing Company, a fixture in San Francisco since the nineteenth century, Dennis Phillips’s office tried to help organize an employee buyout. (The effort failed.) She pinned some of her hope for filling offices on artificial intelligence—an idea that many techies share.

“The best A.I. companies and engineers are all in San Francisco and the Bay Area, and they don’t want to work separated and in silos,” the venture capitalist and political funder Ron Conway told me. It is true that three of the top players, OpenAI, Google AI, and Anthropic, in which Amazon has invested four billion dollars, are within city limits. It is also true that, just as app startups required fewer employees than, say, Citigroup, A.I. needs less office space than older tech: the great promise of A.I., after all, is to obviate the need for labor.

“The A.I. industry is currently, but not for long, composed mostly of humans, and these humans are a social bunch,” Jeremiah Owyang, an entrepreneur and investor who works out of an Airstream trailer, said. “I’ve been to meetups on the beach, bonfires. I’ve been to house parties. That is their life stage. This is when you get your partners, get your V.C.s.” Such human pleasures wouldn’t last, he said. Workplaces in the industry were transitioning to a model known as A.I. First. “A.I. First means you turn to A.I. before you talk to a human. A.I. First means you turn to an A.I. before you hire. If the A.I. doesn’t do it, you build it. If you can’t build it, then you hire someone.” He added, “That is a precursor of what’s going to happen to corporate America.” The downtown of the future, then, will be a smaller, tighter, less worker-oriented place.

The idea that San Francisco is an exceptionally dysfunctional city has stuck in the popular imagination so much so that some posit that this idea itself is a political tool.

Dennis Phillips had recently taken her staff to tour the Westfield San Francisco Centre. “We have to understand the possibilities of that building,” she explained. The mall loomed so large as a harbinger of San Francisco’s struggles that I decided to see the damage myself. When I was growing up in San Francisco, at the turn of the millennium, the opening of the Westfield mall had seemed like the capstone of the city’s rise. Now I expected a ruin—the remnant of a once triumphal age.

As I approached, I found the stretch of downtown around the mall lively and crowded. People in the local office garb of slacks and zip vests brushed past, thumbing their smartphones. In front of the Dawn Club, a storied jazz bar that Sheehy reopened this year, men in suits were playing a game that they called Doomloopin Bowling on a strip of AstroTurf. Inside the mall, which as of now has no closure date, I saw customers flowing from Bloomingdale’s. To my left, a Michael Kors salesperson chatted with a couple as, on my right, young men studied fancy watches in an I.W.C. Schaffhausen. The food court was noisy, and there were no free tables at Panda Express. The grimmest space was on the top floor: a Cinemark whose lease is up in the fall had gone dark early. “They’re closed,” a bored-looking guard announced to no one.

In public declarations, Westfield—like Gump’s—laid the blame for its lack of business on the condition of San Francisco’s downtown. But in the past forty years the number of malls in the United States has declined by nearly three-quarters, and a tour of downtown San Francisco today, its streets packed, its bars busy, can seem an odd me-or-your-lying-eyes experience. By many measures, San Francisco is the safest it has ever been. Violent crime is a third of what it was in 1985, and currently twenty per cent below the average of twenty-one major American cities.

The city has a triple-A credit rating. Most of its residential neighborhoods are clean and green and bustling. With the exception of the Tenderloin, the neighborhood from which most dire imagery comes, a walk through San Francisco is a stroll around an affluent Pacific capital of small bookstores and night markets and weekend festivals—so much so that one can almost wonder where the idea of a city in decline emerged.

“A lot of it is perception,” the mayor, London Breed, told me one day. “The feeling of ‘I don’t know if something is going to happen to me.’” We were sitting in her office, a wood-panelled sanctum deep in City Hall; a placard on her desk read “WHAT WOULD BEYONCÉ DO?” “It’s what people are seeing on the Internet,” she added.

Breed, who first took office in 2017, after the previous mayor died, grew up in public housing in the seventies and eighties. At a Board of Supervisors meeting in June, a program initiated by Breed that authorizes police officers to arrest people who appear to be using drugs on the street was challenged by Dean Preston, who noted that such programs had been shown to target people of color. Breed shot back, “Here we go—another white man who’s talking about Black and brown people as if you’re the savior of those people and you speak for them.” She said that he didn’t understand what worked for real people: “It’s not just services—it’s also force.” Three weeks ago, in a controversial move, Breed called for new legislation barring individuals from receiving city assistance if they decline treatment after testing positive for drugs.

On the Engardio spectrum, Breed’s policies have been moderate. Her election campaign, in 2018, was funded in part by tech leaders. In many people’s eyes, she distinguished herself with firm action at the start of the pandemic, averting the death spike of cities like New York by announcing a lockdown early and setting up emergency services. Yet on issues unanswerable to a simple executive order, such as homelessness or housing, she has taken public blame. “This mayor has no C.O.O.”—chief operating officer—a former member of her administration told me, suggesting that Breed didn’t delegate enough to keep tabs on complex projects or their personnel. (In the past two years, top employees in the Public Works and Building Inspection departments have been convicted of bribery and corruption; both agencies report to the mayor.) Breed’s approval ratings by some counts once hovered in the fifties, but, with anxiety about downtown growing, two-thirds of San Franciscans now disapprove of her, according to a recent poll.

In February, Breed released what she called a “Roadmap to San Francisco’s Future,” a set of policy tweaks that included simplifications to the small-business tax code. “We are trying to make things a lot easier, more efficient,” she explained in her office. I asked whether leaning heavily on tech to build up downtown had been a mistake. “We realize just how completely relying on office space, and mostly one industry, is not the right decision for any thriving downtown,” she conceded.

In June, Breed proposed turning the Westfield mall, which sits on land owned in part by the San Francisco school district, into a bio lab, or possibly a soccer stadium. She told me that she imagined chopping up large retail structures into mixed-use pieces: retail on the bottom, offices in the middle, housing on top—work already under way at the winnowed downtown Macy’s. “We’re changing what this historic building—with the best bathrooms in the city—is going to be,” she enthused.

Breed’s critics say that proposing interesting ideas is not the same as executing them. “This mayor is not a collaborative mayor—she grew accustomed to issuing executive orders during COVID,” Ahsha Safaí, a supervisor who has filed to run against Breed next year, told me at a sidewalk table recently. “My own home was broken into, and they stole my stove and my microwave,” he said. “And my hood fan!” He would deal with problems in a more results-chasing way, he said, and, as if to underscore the point, abruptly sprang up from the table where we sat to sprint after a woman who had left her backpack on a nearby chair. Pen in hand, I watched him vanish at a distance of one block, then another.

“Something as acute and painful as what we’re going through calls for an all-hands-on-deck approach—no one’s coming to save us,” Daniel Lurie, another mayoral contender, told me. He is a fifth-generation San Franciscan whose family owns a majority of the shares of the Levi Strauss company. In 2005, he founded Tipping Point Community, a poverty-fighting nonprofit that has received donations from tech figures like Marc Benioff and Chris Larsen; he is presumed to be the candidate now favored by parts of the tech industry. I asked him whether, as a longtime local, he really thought that the city was in an uncommonly bad state.

“No, it’s not as bad as everyone says,” he said, hesitantly. “But could it be a lot better? Yes.” He added, “I think there’s a sense of”—he paused for a well-chosen word—“disorder that is different. Before, everything wasn’t locked up in the Walgreens. You didn’t feel there were no consequences.”

Just outside Breed’s office, the series of plazas running east from City Hall, toward Market Street, has become one of the most visible reminders of both the drug trade and the city’s unrealized goals. In 2017, the city commissioned a plan to remake the corridor. The landscape designer Willett Moss went on a listening tour of the abutting neighborhoods and drew up a green-space plan. (“If I think about any ambition for the city right now, it’s to make a commitment to public space, and demonstrate that we’re here to stay and we give a sh*t,” he told me.) In 2019, he submitted the plan, which was warmly received, then put on ice. The mayor told me that she didn’t remember it; in July, the Recreation and Park Department announced that a renovation of one of the most drug-addled stretches of the corridor would center on a skate park. Phil Ginsburg, the department’s director, said that the skate park was a placeholder while the city marshalled funds for the fully reimagined corridor—an investment, he said, “that San Franciscans and our government may or may not be able to stomach in one bite.”

In her office, Breed spoke about the difficulty of getting change through government. “First, I pray,” she said. “A lot of our rules and regulations are ‘You can’t do this, you can’t do that,’” she went on. “How do we get to yes? How do we become what San Francisco is known for—being creative, innovative, where anything is possible?” I was surprised to find the head of the city lambasting the constraints of departments that she runs, until I realized that she was channelling public sentiment: in the bluest major city in America today, there is a sense that government is something that you work around or leave behind.

“They say that there’s a doom loop, but do we believe that?” Manny Yekutiel cried.

No! ” a rowdy group of volunteers yelled back.

“Are we going to show them wrong?”

Yes!

Yekutiel moved to San Francisco eleven years ago, partly as what he calls “a gay pilgrim”—his coming-out at home, in L.A., had been uneasy—and partly as a veteran of Barack Obama’s 2012 campaign team. His first job after that was at the tech-inflected advocacy group FWD.us, started by an Obama fund-raiser named Joe Green and Green’s Harvard contemporary Mark Zuckerberg. Five years ago, Yekutiel opened Manny’s, a café and civic-event space in the Mission District. Long a Latino neighborhood, then filled in by techies, the Mission these days is a snarl of conflicting interests; Yekutiel has sought to unite them, and to bring powerful people into the mix. “We’ve hosted Adam Schiff, Jill Biden, Katie Porter, Barbara Lee, Kamala Harris, and Jane Fonda,” he said. Every Sunday morning, he holds what he calls a Disco Trash Pickup for the neighborhood; that Sunday, a hundred and twenty-two people had shown up to volunteer.

“What are the places where the government, private benefactors, and nonprofits aren’t able to do the whole job?” Yekutiel said as he handed out orange vests, trash grabbers, bags, and gloves. “That’s where people power comes in.”

An assistant named Caleb brought Yekutiel a curious platter of walnut-based dips, which he began to munch. “I love disco,” he explained. “I’m full disco vibes all the time.” Wearing a pendulous disco-ball necklace over his vest and pink-tinted glasses shaped like hearts, he rose and took up a bullhorn to address the volunteers.

“This is why San Francisco is resilient! This is how our city is going to come out of this!” he cried. “All of you, on three, say ‘Trash’! One, two, three...”

“Trash!” the volunteers yelled.

I took a trash grabber and accompanied Yekutiel to the alleyway beside his café. The street was filled with junk. “Don’t pick that up,” Yekutiel told me as I snatched a plastic bag out of a puddle. “That’s probably urine.”

To Yekutiel, the Disco Trash program, which has grown to pickups in nine neighborhoods, is an example of civic activism. “There’s a bit of complacency, like”—he raised his voice in mock indignation—“‘Why is there trash on the street?’ Well, what are you doing about it?” He picked up what looked to be a pair of underwear. “The government is—too much ideology. Not enough action. I guess that’s what elections are for. But you can’t rely on elections in a crisis.”

“Not bad, but have you guys been to the house where they’re giving out full M.F.A.s?”

Cartoon by Sara Lautman

Yekutiel describes himself as friendly to the public sector—he is the youngest person on the city’s transit board—but much of his work draws from private sources. This year, with Daniel Lurie, he created a nonprofit called the Civic Joy Fund, whose advisory board includes people who work in philanthropy, commerce, labor, City Hall, nonprofits, and drag performance. Its contributors include Visa and the Gap Foundation, both based in San Francisco, as well as tech multibillionaires such as Jack Dorsey. It metes out funding for, among other things, small public-art projects, habitat restoration, and a program for city-block improvements.

We reached the end of the alley. Yekutiel suggested that we continue on a parallel street. The point of the cleanup, he said, is to give people a way to make change in the city beyond yearly visits to the voting booth. “Part of what San Francisco is famous for is this spirit of civic engagement—the Summer of Love, free clinics on Haight Street,” he said. “It’s like Shabbat, you know? Everyone will go to a Shabbat dinner if they’re invited.” We looked down the lane, where a small dumpster had been tipped over on the curb. “The food doesn’t even need to be good,” he said.

Even in 2021, San Francisco had the highest per-capita income level of any major city in America—something that would have been almost inconceivable a couple of generations earlier. In 1995, the city’s average home value was about double the national mean; a quarter century later, it was five times as much. Organizers such as Yekutiel can work to balance opposing interests. Just as often, though, it happens that the city’s old habit of turning to people power is harnessed for new priorities and goals.

One fresh, cool morning, I stopped in the city’s Hayes Valley neighborhood to meet a pair of tech workers, Sachin Agarwal and Steven Buss, who, in 2020, founded the organization GrowSF, now one of the largest nonprofit political spenders in San Francisco. They met me in a pedestrian square, known as Proxy, filled with French garden chairs the color of the Golden Gate Bridge. A passerby out for coffee hailed Agarwal as he sat. He shouted back, “You disappeared off the Internet—you don’t use X!”

Twitter had been abruptly renamed two days before. I expressed surprise that the new branding was already in colloquial use.

“That bird was from 2012, so it’s literally eleven years old,” Agarwal told me. He had worked as a product manager at Twitter from 2012 to 2016. “The company was really dysfunctional,” he said. “You’d ship these tiny little changes to the product, and almost nothing would change. I’m not trying to say Elon has the answer, but at least he’s going to try something totally different.” He added, “The fact that they were able to lay off, like, eighty per cent and the service is still up and running shows the amount of bloat, the layers of management, people eating free lunch on the rooftops!”

Agarwal’s exasperation with Twitter mirrors his and Buss’s exasperation with San Francisco. The city has an annual budget of fifteen billion dollars—for what? “We should have the best public education in the world, public safety, and clean streets. And the city is just not giving it to us,” Agarwal, who wore a GrowSF T-shirt, told me. Men beside him, at an outdoor LuxFit gym, were deadlifting and bench-pressing enormous bars of weight. “Huh-uhh-uhhh! ” they cried.

Buss, who was wearing the same shirt, told me that he had felt a call to action after becoming aware of development obstructionism while living in a rent-controlled apartment in the Mission and working for Google. San Francisco has more community-review processes than most cities; local residents can call for the review of a building project in the run-up to its approval. In 2020, Buss ran for a seat on the Democratic County Central Committee. “I lost that race, but I took a lot of learnings from it,” he said. “In particular, I learned what makes a good candidate.”

Volunteers in the Mission take part in Disco Trash Pickup, a program that has spread to nine neighborhoods. “Part of what San Francisco is famous for is this spirit of civic engagement,” the program’s founder said.

The two created GrowSF with the idea that political change came through uniting candidates around a particular platform and winning elections. “You can’t just go fight for every project one at a time,” Agarwal said. Instead, the organization, which operates a super PAC, selects moderate candidates who align with its politics and puts money toward mailers and digital ads. It publishes an online voter guide that purports to pin down candidates’ exact positions—Agarwal and Buss send them questionnaires—and explains the finer points of local politics. San Francisco’s five hundred thousand voters have been grateful for the guidance; in the elections last year, GrowSF’s voter guide received four hundred thousand views, and nearly its entire slate was elected. Next year, it seeks to claim all six Board of Supervisor seats up for election, enough to give a moderate mayor full support—or to allow the board to override a progressive mayor’s veto. San Francisco government could finally be run with executive force.

GrowSF has also taken up the business of recalling elected officials who it thinks are underperforming. Last year, in addition to helping to coördinate the recall of three school-board members, the group assisted with the successful recall of the city’s first-term district attorney, Chesa Boudin, whose efforts to reduce the number of incarcerations in the city had created friction with the police department—during Boudin’s tenure, the over-all number of arrests in San Francisco dropped precipitously. A month after the recall vote, Boudin was replaced with Brooke Jenkins, a mayoral appointee, who has taken a tough-on-drugs tack.

“We’re still just the two of us, but the reach we have is beyond what we could have dreamed of,” Agarwal said. (They recently hired a third employee.) Two men in shorts behind him performed bend-and-snaps with kettlebells.

GrowSF is not the only nonprofit with center-left politics to have cropped up recently. “Our organization’s real, big-picture goals are reforming the governance structure of San Francisco,” Kanishka Cheng, the C.E.O. and co-founder of TogetherSF Action, which launched last year, told me. “We would argue that the executive doesn’t have the ability to govern the city like an executive.” Four of the seven members of the police commission, for example, are appointed by the mayor but subject to Board of Supervisors approval; the others are appointed directly by the board.

TogetherSF Action hosts the S.F. Politics 101 class led by Joel Engardio, whom it and GrowSF helped to elect, and develops other kinds of programming, too. “We launched this event called Why S.F. Is Broken, and we do it as a game-show format,” Cheng said. “We play a little game called S.F. in Jeopardy and teach you about the governance structure and what is broken.” In May, TogetherSF bought five hundred thousand dollars’ worth of ad space around town and launched a campaign with the slogan “That’s Fentalife!” to rile middle-class indignation. “Drug dealers now have more rights than our kids,” went one ad; “Keys. Wallet. Narcan,” went another.

The campaign was controversial. Lydia Bransten, the executive director of the Gubbio Project, whose annual budget is three hundred and seventy-five thousand dollars, described it to me as “nasty.” “To blame poor and displaced people for decline when you had a whole influx of people who came to mine the city’s wealth during the tech boom, drove the rents way up, got their money, and then, during COVID, popped out? No,” she said. Yet the idea that San Francisco is an exceptionally dysfunctional city has stuck in the popular imagination so much so that some posit that this idea itself has become a political tool.

“Early in the pandemic, we came together around a very significant set of solutions, most of which were working,” Preston told me. “We rented out entire hotels. We were the only county in California that saw a reduction of homelessness during the pandemic.” Far from being partisan feats of legislative obstruction, he said, these policies were approved unanimously. “We were told, ‘Oh, it’s a pandemic, no one will want a new tax’—completely wrong,” he said. One ballot measure that passed added a tax on real-estate transactions worth more than ten million dollars; another added a tax on businesses whose highest-paid manager earns more than a hundred times the median employee salary.

“What you’re seeing now is a backlash and attempt to redefine all those kind of programs as failures,” Preston went on. A few weeks earlier, Elon Musk had begun targeting him personally, at one point tweeting that he “should go to prison” for his political work; Preston took this as evidence that a “billionaire class” was feeling threatened by the new policies. “There’s an incredibly well-funded and now much more sophisticated echo chamber—some of which is smoke and mirrors, some of which isn’t—to create the perception that the city has had a huge shift to the right.”

TogetherSF Action launched with funding from the investor and former venture capitalist Michael Moritz, who has recently become one of the most active contributors to civic and political organizations in town. In the past two years, he has helped fund Yekutiel and Lurie’s Civic Joy Fund and co-founded the San Francisco Standard, a new digital media company rigorously reporting on the city’s decline. I spoke with Moritz over Zoom one day. He had just left his decades-long post at Sequoia Capital and was enjoying a vacation.

“My apologies for this sort of unseemly attire, but I’ve been out painting,” he said. He was wearing a floppy emerald-green fishing hat, a T-shirt, and cargo shorts. “The most important thing is for these groups, some of which I formed, to become a permanent part of the civic landscape in San Francisco. That will change everything. This is a long game.”

Moritz—who is among the wealthy figures who recently invested in an effort to buy tens of thousands of acres of inland-California ranch land with the aim of building a new city—conceded that the problem was more perceptual than data-driven. “Have the major crimes escalated massively? No,” he said. “But with all the office workers gone the number of people on the streets has shrunk dramatically, which therefore puts the people who live in tents and the mentally ill and those with drug problems into far sharper relief because they can’t as easily sort of melt into the backdrop.” Earlier this year, he published an op-ed in the Financial Times that began, “It’s a strange city that bans plastic straws but permits plastic needles.”

Moritz told me that he became aware of the poor state of San Francisco’s governance after the passage, in 2018, of Proposition C, which imposed a tax on businesses with more than fifty million dollars of gross annual receipts, earmarking the revenue for housing and mental-health initiatives for homeless populations. “A big part of the reason that downtown is empty is because a cadre of supervisors put a punitive measure on the ballot,” he said. (The measure actually got on the ballot through a collection of voter signatures.) “More money wasn’t going to solve the problem! It’s the lack of tailoring treatments to—and, where necessary, prosecuting—the people who are living on the streets.”

Moritz excused himself to welcome some guests who had arrived. He pulled open the front door and said, merrily, “I see intruders!

He ushered them through a pair of French doors to seats in the sun, and padded back to the camera. I asked him whether he thought that devoting so much office space to tech had left downtown prone to crash. He didn’t.

“San Francisco has Airbnb, Uber, Twitter—or X.com—Dropbox, Square, Instacart, Stripe, Pinterest, any number of companies,” he said. “Any big-city mayor anywhere in the world, if they had that number of companies start in their back yard, would have thought they were lodged on the golden seat in Heaven, right? Instead, these companies have become convenient targets to be attacked.” He grimaced. “My guess is that there are no more than a couple hundred people responsible for driving San Francisco to the precipice,” he declared. “I think those like myself have only ourselves to blame—for being absent from the debate.”

At the old Beat hangout Caffè Trieste one Saturday afternoon, I found Matt Dorsey at an outdoor table, deep in conversation with the president of the Board of Supervisors, Aaron Peskin—the longest-serving supervisor and a figure at once loved and loathed. To his supporters, he’s a matador against stampeding billionaires, a protector of the inner politics of Chinatown, and a strong advocate for environmental causes. (Peskin, a bearish fifty-nine-year-old who swims the frigid, possibly unholy waters of the San Francisco Bay, has posed for San Francisco magazine in a Speedo.) To his opponents, he’s the exemplar of graybeard NIMBYism, the reason locals sit in hearings debating matters such as shadows cast by new condos instead of letting developers build the housing that the city so desperately needs.

Peskin and Dorsey, his ideological opposite by local measures, were brainstorming about downtown. Since the start of the pandemic, parts of Peskin’s district, which comprises sections of downtown and the tourist mire of Fisherman’s Wharf, have had some of the lowest commercial-vacancy rates in San Francisco—or, to put it another way, they have proved the most doom-loop-resistant areas of town. In Peskin’s eyes, that’s a lesson about the trade-offs between volatility and stability. Peskin told me, “There was this notion that Tech2.0, after the Tech 1.0 contraction, was going to continue double-digit growth forever. Anybody who is rational and has lived twenty-five years would know that that is not true.” He wore a flowy black luau-style shirt with the word “CALIFORNIA” patterned across it. A crinkled pink plastic bag containing a white onion and a lime was on the table before him; he was planning to make gazpacho later.

A teacher writes on a chalkboard.

Cartoon by John O’Brien

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“Everybody thinks that people in the development business are geniuses and only build as much as there is demand for—no!” Peskin said. “It’s a game of skill but also luck. If you hit it right, you can make a boatload. If you miss it, you can end up giving the keys back and losing your ass. Welcome to capitalism.” In San Francisco, a law passed in the mid-eighties capped the amount of office space that could be built annually, with the unused quota carrying over—a regulatory guardrail that for years kept supply in line with demand and insulated San Francisco from the commercial-real-estate busts that were a regular feature in many midsize cities. Peskin blamed the city’s housing dearth on market forces, not red tape. “Residential development has always been a principally permitted use in San Francisco’s downtown—forever, forever!” he said. The only reason there aren’t huge, dense residential towers everywhere downtown, he said, is that office buildings were more lucrative.

Peskin sees his resistance to the rapid-growth trend as the reason for his district’s resilience. Sure, the Italian cafés and jazz bars of North Beach, and the produce stalls and tea venders of Chinatown, don’t scream City of the Future. But neither has demand for such businesses ever fallen off, regardless of the economy or where people keep their desks. “Do I care if I’m making everybody feel good because there’s a pop-up for two months? Not really,” he said of the city’s recovery efforts. “Now, if that pop-up says, ‘Wow, this is going great and I want to stay for ten years’—that was a success.”

The city’s longtime chief economist, Ted Egan, told me one afternoon that he could see four paths to disaster for a city like San Francisco. “Office industries are eighty per cent of our economy—everything depends on them,” he said. If so many workers vanished from downtown that retailers disappeared, causing more offices to shutter, that would be a doom loop. If public transportation had to cut service for want of fares, the city would grow unfriendly to work. If industry fled greater San Francisco, as car-making left Detroit in the fifties, a vortex could begin. And if tax revenue were so depleted that it required stripping services, the city could spin out.

Egan, a trim, bespectacled man employed by the controller’s office to analyze the effects of proposed legislation, had suggested that we get drinks at the Iron Horse bar, near his office, and drew down a whiskey co*cktail. The interesting thing, he told me, was that none of those bad things had happened. “In the past year, even downtown, sales-tax revenue is going up,” he said. “Retail stores are challenged because of shoplifting, but places like this”—he gestured at the faux-Tudor windows of the Iron Horse—“seem to be doing fine.”

The transit system received a $1.1-billion state bailout to continue service. “Everyone sort of thinks tech left, but all that happened is they work from home,” Egan said. Employment at San Francisco-based tech companies was, in fact, significantly higher than it had been at the start of the pandemic. “People sort of periodically rediscover that there’s homelessness in San Francisco,” he added, dryly. “I wouldn’t call it a shrinking problem, but they have managed to limit it out of the central business district, whose attractiveness they are focussed on.”

And tax revenue? “In 2021, we lost five hundred million dollars—a lot,” Egan said. He leaned across the table. “But the context for that is that we had seen so much growth in the last twenty years that we doubled our tax revenue per resident. We were rolling in money.” Tax losses from commercial real estate were slim. “One of the things that makes it easy for us is Proposition 13”—the much maligned nineteen-seventies law that keyed California property taxes to value at the point of sale. “I never saw the good side of it until we realized how under-assessed all our office buildings are,” he said, explaining how the rule cushioned the change in revenue as building values collapsed. “We have to not make utterly moronic spending choices, and generally I think the city is more aware of reality than outsiders give it credit for.”

Post-pandemic Jackson Square—eclectic, crafty, and refined—is on the rise. “You’ve got this interesting mix—some studios, creative spaces, designers, and then a lot of money coming in,” a restaurateur said.

Egan knew how hard it was to keep people in the city after the pandemic: two years ago, he had a child and left the Bay Area for a house in Sacramento. Now he commutes in three days a week—which he finds more remunerative and pleasant than working at a suburban company. There are, he thinks, a lot of people like him: a major metropolitan downtown, like San Francisco’s, is simply too well wired with transportation to empty out for long. Suburban office buildings were likelier to bear the brunt of the shift to remote work.

That’s really what you want to convert into housing—the suburban office parks by the BART train,” he said. “Converting an office building in downtown San Francisco makes no sense, which is why it’s not happening.” This will be especially true, he thinks, as boom-time mortgages go into foreclosure and office rents fall.

“A one-bedroom was around three hundred per cent of the U.S. average, and now it’s around two hundred per cent,” Egan said. “A single-family house was six times the average. Now it’s four. I think that’s a remote-work trend that will continue. So then the question is: Who bites on cheap San Francisco housing? Is it students? Is it immigrants? Is it artists? Is it techies?”

In 2008, the restaurateur Lindsay Tusk and her husband, a chef, opened a restaurant in a part of San Francisco widely believed to be dead. The neighborhood, known as Jackson Square, had old colonnaded storefronts and an interesting history. It had once been a stomping ground for Mark Twain and his circle. (It was home to some excellent booze purveyors.) But the growth of the surrounding city had turned it into an awkward nowhere zone. “It was professional services, like dentists and lawyers,” Tusk told me. “There were tumbleweeds.”

She had loved the buildings, though—“single story or, at most, two stories, a very relatable kind of architecture,” she said—since discovering the neighborhood on a visit to William Stout Architectural Books when she was in college. “It had a very special gravitational pull.”

At some point last decade, Jackson Square started to change. Allbirds, the trendy shoe brand, set up its headquarters and flagship there. Fjällräven and other companies moved in. The Tusks’ fine-dining project, called Quince, soon began earning Michelin stars, and, in 2010, they opened a more casual companion, called Cotogna (“Quince” in Italian). During the pandemic, when the neighborhood again went dark, the Tusks opened a pop-up grocery and a farmers’ market and made delivery runs. Their restaurants survived.

And then a curious thing happened: post-pandemic Jackson Square took off. Jony Ive had bought a couple of neighboring properties for his creative collective, LoveFrom, and, according to Tusk, planned to fill retail space with cobblers, bookbinders, and other craftspeople. (There may also be more twenty-first-century activities: it has been reported that LoveFrom is in conversations to produce the first OpenAI consumer device.) Thom Browne, the gray-clad designer of tucked ties and short trousers, opened his first urban California boutique. And Bain Capital is renovating a building on Cotogna’s block, with the thought of bringing in a hundred employees.

“Now you’ve got this interesting mix—some studios, creative spaces, designers, and then a lot of money coming in,” Tusk told me at a table at Cotogna. We were eating a salad of gem-lettuce leaves dressed with Meyer-lemon zest and a plate of ravioli filled with corn and melted butter. (“Like summer to me,” she said.)

If global tech towers and fast-casual lunch chains reflected one downtown ideal, which is the model now in crisis, the post-pandemic downtown of Jackson Square—eclectic, crafty, and refined—is a vision on the rise. Traders of real estate have noticed. “COVID changed the mind-set,” Michael Shvo, a New York-based real-estate magnate who bought the Transamerica Pyramid, in 2020, said. “Tenants want to come to work in a beautiful building with amenities and restaurants and places where they can meet friends and an ecosystem around their working environment.” Otherwise, why not work from home?

“So, it says here you threw away a handwritten birthday card from your aunt instead of keeping it in a drawer for fifteen years?”

Cartoon by Daniel Kanhai

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When the Pyramid was built, the designer, William Pereira, designated land for a public redwood garden at the base of the tower. The trouble was that the public rarely used it. Shvo is fitting the redwood plaza with cafés to pick up on the flâneur commerce of Jackson Square. “Sometimes it requires an outsider to see what the insiders don’t really see,” he told me. “The Pyramid is the second-most-expensive building to rent in America, in a market that many people have written off. Which tells you two things. No. 1, there is desire from great minds and great companies to be in San Francisco. And, two, tenants are willing to pay.” This year, he granted a lease at two hundred and fifty dollars a square foot—the most expensive office space in San Francisco to date.

If the struggle in San Francisco’s downtown is the struggle of the American urban dream—how to be a global city and a small, authentic town at the same time—the solution rests with those who can build bridges between structures of power and grassroots enterprise. As the pandemic took hold, Jacob Bindman, a recent college graduate, found himself at home, in San Francisco, looking for a job. On March 10th, days before the city’s lockdown, Lenore Estrada, his former boss at a bakery that did catering for big tech companies, contacted him in a state of alarm: March 14th was Pi Day.

“Which does not matter unless you own a pie business in San Francisco, in which case it’s on par with Thanksgiving,” Bindman explained. “In something like a six-hour window, she had one hundred per cent of her Pi Day orders cancelled, which represented about a hundred and fifty thousand dollars’ worth of product already made. I was, like, What can we do with this huge volume of pie?”

As they mulled over the problem, they happened to hear that organizations that provided food to people in need had had their normal operations curtailed by the lockdown. They saw that the two problems fit together. “We know there’s a bunch of restaurants that need capital, and we know there’s a bunch of people who need food,” Bindman said. One of Estrada’s friends, the Twitch co-founder Emmett Shear, offered a million dollars to help connect the halves.

Four days later, Bindman, Estrada, and a group of ten friends began buying meals from restaurants and delivering them to food-relief programs. In their first week, they delivered a thousand meals. In their second, eighteen thousand. By May, they were sending fifty thousand meals around the city. To every new restaurant they worked with they committed to spend at least eight thousand dollars a week for ten weeks. When Shear’s money started to run out, the delivery team applied for funding to the city government, which opened two contracts of ten to twenty million dollars each, for distribution to homebound seniors and to converted shelter hotels.

Today, the project, a nonprofit called SF New Deal, works with Dennis Phillips’s office as a liaison between the city government, private donors, and small businesses, to which it offers services. It runs a transportation program for workers and helps businesses bring outdoor dining structures into compliance. And now, with Dennis Phillips, it places businesses, artists, and pop-ups in empty spaces around town; all the while, it collects data to fine-tune its services to suit common needs. Bindman told me that he saw the effort as at once exacting and broad.

“There has been an obsession for a long time around whose job it is to fix San Francisco,” Bindman told me. “There’s definitely a strong belief that’s, like, ‘Tech people made problems. Tech people need to fix problems.’ There’s a strong cohort that’s, like, ‘We pay a bunch of taxes. The government needs to be able to solve this.’ And there’s a cohort of people who are, like, ‘Only people from San Francisco can solve San Francisco.’”

Traffic washed by. We were sitting at a sidewalk table at a café on the corner of Arguello and Clement, near the apartment where Bindman lives and works—the nonprofit has no offices. I had taken a long walk across San Francisco, through the neighborhoods and parks and out toward the ocean. It was a bright and sunny day with tufted clouds and breezes sweeping in off the Pacific, and I allowed myself to think that the city had not in years felt quite so set for possibility, so open and warm. “I think what SF New Deal represents is the very obvious answer, which is: everyone. Everyone is responsible,” Bindman said. He took a sip of coffee and looked up. “The only solution that’s a real solution is a solution in which everyone is involved.”♦

An earlier version of this article mischaracterized the type of judge that filed the injunction.

What Happened to San Francisco, Really? (2024)

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