Carolina Ochoa

Dr. McLaughlin

Abstract/Annotated Bibliography

March 18, 2015

Abstract

It’s difficult to imagine poverty or homelessness occurring in a land of vast

wealth and technological advances. One may even question the plausibility of such a

possibility. Unfortunately, it is a reality for a large number of California residents, whom

live in indigence and/or on the streets near some of the world’s largest and lucrative tech

companies. Silicon Valley is an area in the golden state of California that is generally

known for its riches and as the epicenter for tech companies such as Facebook and

Google, but it is generally unknown for its mass income inequality and homelessness.

Why is this the case? Technology seems to be causing the poverty and the disparity felt

by this community, but how? This report will demonstrate the relevance and importance

of this otherwise unnoticed issue (suburban poverty) and specifically the effect

technology has on causing and impacting this issue.

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Annotated Bibliography

Bohn, Sarah, Caroline Danielson, Matt Levin, Marybeth Mattingly, and Christopher Wimer.

The California Poverty Measure: A New Look at the Social Safety Net. Rep. Stanford

Center on Poverty and Inequality, Oct. 2013. Web. 16 Mar. 2015.

This report documents the poverty conditions in California and stresses the importance

safety net programs for poverty have on lowering the number of Californians in poverty.

Poverty thresholds were calculated for the counties (low, mid, or high) of California.

Some of the higher-costing counties include San Mateo, San Francisco, and Santa Clara,

home zero of Silicon Valley. San Mateo has an official poverty rate of about 6.7%, but

the CPM calculated an underestimated 18.4% poverty rate for residents of the county (9,

see “California Poverty Rates by County”). In addition, the report also indicates that high

housing cost in heavily populated areas in the state are increasing the poverty rates. If

housing cost were lowered to affordable prices, then poverty would decrease by 7% for

all people affected (21). This report helps to establish the prominence poverty has on the

state and on its counties. Furthermore, it demonstrates the affects high cost, which make

safety net programs such as reduced lunch and Cal Fresh a necessity to prevent poverty

rates from increasing.

Elinson, Zusha. "U.S. News: Priced Out of Silicon Valley --- Boom Brings Surge in Housing

Costs, Push to Ban People from Living in Vehicles." Wall Street Journal Apr 09 2014,

Eastern Edition Ed.  ProQuest . 19 Mar. 2015 

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In this article, the story of a man who fell into homelessness in Silicon Valley is told. His

story began 30 years ago as a man working in one of the tech companies of Silicon

Valley making about $120,000 annually. He was living comfortably until he was laid off

from his job. He had savings, but those quickly disappeared with the expensive living

cost of the valley. Soon, he couldn’t afford his $2000 a month rent (for an apartment)

with his only source of income being a $1700 a month Social Security check. He was

then forced to live in his camper, shower at his gym, and eat a daily $1.29 breakfast from

McDonalds. This article can help to stress the importance of this issue of poverty and

homelessness by demonstrating to the audience how anyone can fall into poverty.

However, in the article, the man’s stepson commented that he didn’t know how to

manage money fiscally, but the article also sites that the median income is 75% higher

than the national average, suggesting a high living cost and how perilous it can be for one

to lose their job in such an expensive area. This article shows the figures for living in the

area and helps in illustrating the expensive lifestyle of the valley.

Hepler, Lauren. "Stanford: Silicon Valley Poverty Worse than Previously Estimated - Silicon

Valley Business Journal." Silicon Valley Business Journal. Silicon Valley Business

Journal, 1 Oct. 2013. Web. 16 Mar. 2015.

In this article, Lauren Hepler reports that despite the reputation of Silicon Valley as being

a land of rich people, “more than 18 percent live in poverty.” A study was conducted by

the Stanford University Center on Poverty and Inequality and the Public Policy Institute

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of California to accurately measure the otherwise ignored high living cost, large

undocumented immigrant community, and “under-reported reliance on social safety net

programs.” The problem of the high cost of living is that many residents are not high-paid

CEO’s or employees of the numerous tech companies surrounding the Silicon Valley

area, making them vulnerable to poverty. This information on the analysis of many

population groups and areas helps to paint the picture of poverty in an otherwise pretty

picture. This information was useful in gathering data on the poverty dilemma and also

helps in proving that there is poverty occurring in Silicon Valley that is worrisome.

Keen, Andrew. The Internet Is Not the Answer. Tunbridge Wells: Atlantic, 2015. Print.

This book was written by an entrepreneur in the tech industries of Silicon Valley,

Andrew Keen, and explains how the Internet has impacted society. This book talks about

the large disparity in income and unstable job market coming about from tech industries.

Despite the massive amounts these corporations make, employment does not appear to be

augmenting. The popular messaging app WhatsUp “sells for $19 billion,” yet only

employs fifty-five people (193). Not only that, their treatment of unskilled workers is

awful, with corporations such as Amazon being described as “most egregiously ruthless

corporations in America,” being compared to Wal-Mart, infamously known for poor

treatment and payment of workers (49). Tech industries have created jobs, but they are

destroying jobs by “monopolizing cast swaths of our information economy,” such as is

the case with Google (36). Also, corporations are taking money out of the economy

through tax cuts and the services they provide. This source may be inclined to some bias,

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but Keen some first hand experience from working in the tech industries and living in

Silicon Valley for more than 20 years.

Massa, Rachel, comp. "2015 Silicon Valley Index." Boom: A Journal of California 5.1 (2015):

1-88. Joint Venture Silicon Valley, Inc, 2015. Web. 24 Mar. 2015.

This source is the Silicon Valley Index that comprehensively measures the economy and

conditions of the community. This report is conducted annually and provides detailed

information to show a better picture of the overall health of the Silicon Valley

community. This source features key points of the economy, such as employment,

income, housing, and innovation and entrepreneurship. Some interesting points of this

report are the facts that job growth have increased in part because of Silicon Valley and

that disparity between incomes is great. Wages earned by the Tier 1 of the valley are

about $120,000, while they are around $60,000 for the middle and about $30,000 for the

bottom Tier. Moreover, according to the report, nearly 30% of Silicon Valley’s

population lives below the Self-Sufficiency Standard. This source will be helpful in

showing how living in Silicon Valley can be expensive and difficult. Also, this report

includes figures from past years, comparing and contrasting them to the present, which

will be helpful in showing the changed that occurred in the Valley.

Silicon Valley. Prod. Randall MacLowry and Tracy H. Strain. PBS, 2013. Documentary.

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This documentary tells the history of the birth of Silicon Valley. Original called The

Valley of Hearts Delight, the Santa Clara Valley during the mid 20th century was a place

of agricultural charm instead of technological marvel. The land was filled with “mile[s]

upon lush, green mile[s] of fruit trees, heavy with apricots, cherries, and almonds.” The

wave of electronics swept over this area when renowned physicist William Shockley left

his position at Bell Telephone Laboratories, a well-known private research and

development firm in New Jersey, to start his own company in The Valley of Hearts

Delight, a place where he had special ties to, in addition to the cheap land being offered

by Stanford University in hopes of luring aerospace and electronics companies to the

area. As a result of Shockley’s ambition to “exploit the commercial potential of the

transistor and make it the cornerstone of a large and potentially lucrative new industry,”

leading him to the valley, many new tech firms and industries were created. This

documentary helps in understanding the formation of the valley from farmland to

machine land and gives the background information of that transformation.

Pellow, David N., and Lisa Sun-Hee. Park. The Silicon Valley of Dreams: Environmental

Injustice, Immigrant Workers, and the High-tech Global Economy. New York: New York

UP, 2002. Print.

In this book written by Associate Professor David Naguib Pellow and Assistant Professor

from UC San Diego, the problems of Silicon Valley caused by the tech companies are

discussed. The history of the valley is discussed, revealing the nature of the valley as

being a place of labor exploitation. Before the rise of the machines, the Santa Clara valley

and areas surrounding it relied on the agricultural industry. Now, it relies heavily on

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technology and cheap labor. Strangely enough, in a place where living and housing is

expensive, houses costing a million dollars and the average wage near $50,000 in 1998

(and cost still rising), workers are poorly paid, “bring home less than $10,000 a year in

Silicon Valley [after taxes for the 1998 year]” (2-3, 87). In 2001, the average cost of a

house in the valley was $450,000, making even the cheapest housing possible in the area

impossible for a low wage, unskilled worker (87). In addition, this book talks about how

temporary job employment is increasing in the valley, offering little job security and

barely any benefits (health, accidents, discounts) (154). This book offers credible

information on the impact Silicon Valley has had on the environment and people of the

area and helps to show the consequences of the tech industries in the valley and even in a

global setting.

Sutter, John D. "The Poor Kids of Silicon Valley." CNN. Cable News Network, 2015. Web. 04

Mar. 2015.

In this interactive news article, CNN’s Opinion John Sutter exposes the crisis of poverty

in Silicon Valley. In Silicon Valley, the median income household is roughly around

$88,200-$91,702, nearly double the country’s average of $53,064. This increased in

median income correlates with increase in living expenses, especially with housing. One

resident, Nicole Jones, rents a garage for $1000 a month where she and her baby live.

Another family, although the father, Rich, currently has a construction job and the

mother, Stacy, worked as a receptionist, lost their home and live in a shelter with their

children. “Median rental list price in San Mateo Country is $2,975 per month, $35,700

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per year.” The increase of housing prices, and of living overall in the valley, can be

attributed to the success of nearby tech companies such as Google, Apple, and Facebook.

There are programs to help families and individuals have means for affordable housing,

but waiting list can take months to years. Mayor Sam Liccardo of San Jose says,

“Housing costs have driven families out of their homes and into the streets.” This

information is used in giving primary sources from people who live and have experienced

such hardships. Interviews had been conducted and the information provided has credible

sources. However, this article does express some opinion for Sutter, although they are

backed up by research he has conducted on this issue.

Swartz, Jon. "Struggling in the Shadow of Silicon Valley Wealth." USA Today. Gannett, 11

Nov. 2014. Web. 10 Mar. 2015.

In this article, USA Today’s Silicon Valley based-tech reporter Jon Swartz details the

hardships and progress occurring in Silicon Valley as a result of, respectively, income

inequality and philanthropy. Swartz uses housing data to show how the disparity between

the “haves” and the “have nots.” “The average home in the San Francisco Bay Area sells

for $1 million, and most apartments rent for more than $2,500 a month.” This makes it

difficult for those, such as “Blacks and Hispanics, who work inside companies such as

Google and Facebook but are employed by outside contractors, [and] typically earn low

wages and few, if any, benefits” to find affordable housing, forcing them to live in

shelters or cars. There is mention of San Mateo County being “the third-richest in the

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state,” yet homelessness still existing. Furthermore, in San Francisco, while “tech jobs

[have] risen up 56% [and] unemployment down 4.4%, housing prices are rising at a 20%

rate.” This article helps to explain why homelessness is occurring in such a wealthy area.

The fact that housing prices are rising at a tremendous rate make it increasingly difficult

for those earning lower wages to find reasonable priced housing.

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