Project Gentrify in Oakland: Turning Our City on Its Head to Profit from Displacement
UPTOWN APARTMENTS. Buildings of glass and steel. Hipsters. Strollers. Artisanal lattes and cupcakes. Chic cafes littered with Apple laptops. These are some of the myriad images associated with gentrification in Oakland, but to see them as the end of the story would conceal the role of the 1 Percent in turning our city on its head so they can profit from displacement.
The West Oakland Specific Plan (WOSP) is the most recent scheme for gentrifying Oakland, pushing people of color and blue-collar workers out, and moving tech in. It labels large swaths of West Oakland "opportunity sites" for redevelopment and connects with other redevelopment schemes to cover a massive area, stretching from Interstate 880 to Adeline Street, and East 14th Street to Emeryville.
Plans to redevelop the Coliseum and Lake Merritt are also in the works. While WOSP's authors promise "a healthy, vibrant West Oakland" and tout the input of "a wide range of community members [and] stakeholders," in content, WOSP is a plan for "development with displacement," in the words of Causa Justa :: Just Cause.
WOSP is part of Oakland Mayor Jean Quan's master plan to bring 10,000 new residents and 7,500 new market-rate rental units into the city by courting private developers. Quan's plan explicitly focuses on "transit corridors"--that is, on housing positioned for commuters drawn in by the tech boom across the Bay in San Francisco, not for Oakland's current residents.
Unemployment in West Oakland was more than 40 percent at the time of the 2010 census, and two-thirds of residents live below the poverty line.
Until activists stalled final approval of WOSP at the July 29 Oakland City Council meeting, none of the slated housing development projects even gestured at accommodating low-income current residents. A revised plan now calls for 15 percent of WOSP housing units to be "affordable." But this is only a professed goal, left out of the implementation details, and isn't much of a concession, even if it does end up being enforced.
Multibillion-dollar housing lobbies have convinced the federal Department of Housing and Urban Development to privatize public housing and enforce minimum-income requirements for new "affordable-housing" units. If it follows the guidelines set out by an umbrella organization made up of housing developers who back WOSP, the new "affordable housing" will require that prospective tenants families have a household income between $47,000 and $65,000 and pay rent between $1,200 and $1,600 per month for a two-bedroom apartment. Three of four West Oakland households make less than this threshold, often much less.
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AT THE June 11 City Council meeting about WOSP, Mayor Quan argued that creating market-rate units for new renters moving into Oakland will ensure that existing housing remains available for locals. There happens to be historical precedent only for the opposite. The development of new market rate housing in San Francisco put a dramatic upward pressure on rents across the city that has rippled through the Bay Area.
Rental costs in Oakland are projected to go up, up, and away: In 2012, the average rent for a one-bedroom Lake Merritt apartment went up from $900 to $1,200. At the beginning of 2014, the average rent was $1,861, with a long way to go still to catch up to San Francisco's $2,631.
That's meant that a lot of people have been forced out of Oakland. Oakland's Black population dropped by 23 percent between 2000 and 2010, and it's safe to assume that as rents skyrocket, such displacement will continue.
WOSP's more progressive defenders argue that strong affordable-housing mandates need to be citywide, or developers will just avoid West Oakland. Meanwhile, we're supposed to have patience and trust that City Hall will address these concerns.
But it's hard to imagine builders passing up any chance at development near West Oakland BART, the city's closest station to San Francisco. More seriously, this pro-WOSP argument is a fatally self-defeating one. If we cannot demand concessions from capital because capitalists can invest somewhere else, then in a world where capitalism reigns, we are powerless to demand any consideration for human need.
WOSP hasn't yet produced concrete plans involving specific developers--it only smooths their way. For a preview of what the next stage is likely to look like, we can turn to the redevelopment of the former Oakland Army Base, adjacent to West Oakland, begun last year and closely connected to WOSP's vision.
The Army Base is being developed as a trade and logistics center in conjunction with the Port of Oakland. This $1.2 billion project--with substantial public funding--is being spearheaded by Prologis Incorporated. The billionaire partners of this firm include T. Robert Burke, founder of Metro Real Estate Equity Management LLC, a building contractor with the Carlyle Group and a major war profiteer under both the Bush and Obama administrations.
Prologis is partnering with the California Capital Investment Group, founded by Phil Tagami, a former president of the Port's Board of Commissioners now profiting from that connection. Tagami is perhaps best known for waving a shotgun at an Oakland Occupy protester in November 2011.
Community activists won a promise that 50 percent of hours worked at the Army Base project would go to Oakland residents--with some "small business" loopholes. But as of July, only 91 out of 425 new construction jobs had gone to people from Oakland, and just 11 had come through the jobs center created for West Oakland.
And while the project was pitched under the title "Restoring Oakland's Working Waterfront", the image this brings to mind of the pre-container waterfront of the 1950s with its tens of thousands of union workers is misleading. The project used to be called the "Oakland Intermodal Trade Gateway"--"intermodal" referring to its goal of replacing hundreds of truckers and other workers with a more direct and efficient ship-to-rail transfer.
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THIS VISION for the city is emblematic of what Oakland's ruling elite desires. Capitalists investing in Oakland want it to become a center of growth based on the same high-tech economic model that's come to dominate San Francisco and the South Bay and is now one of the main pillars of production in the U.S.
Oakland can't easily offer the rock-bottom taxes, freedom from interference and space to sprawl that tech firms and other companies have found across Silicon Valley and the more distant edges of the Bay Area.
But neither can San Francisco--and its civic leaders have nevertheless succeeded in attracting vast amounts of capital. Beyond making special deals with particular corporations, San Francisco's formula has been to foster high-end residential development and service-sector businesses catering to skilled mental laborers and to companies wanting to offer a cool place to live and work while benefiting from the infrastructure and networks that have built up around the Bay.
However, San Francisco has reached a point where it's pricing out even tech workers--so there is an "opportunity" for Oakland. People are already moving to Oakland as they take jobs produced by the area's tech boom, and their offices could very well follow them across the Bay, just as they did from Silicon Valley to San Francisco over the last decade. The flows of money at stake are gigantic, both speculative (venture capitalists are investing more than $10 billion per year in the Bay Area, 40 percent of all venture investment in the U.S.) and realized (Bay Area-headquartered Google alone has $50 billion in yearly revenues).
Of course, Oakland is not about to switch completely to the production of software and the "next big idea," even if most manufacturing has left permanently for inland or overseas. Health care giant Kaiser Permanente (with almost as much yearly revenue as Google, although with lower profit margins) is Oakland's biggest employer, with more than 10,000 employees. The two next-largest private employers are also health care providers, and employment in the sector has increased by 56 percent in Oakland in the last half-decade.
And Oakland still hosts the fifth-largest container port in the U.S. with $40 billion worth of goods passing through each year and billions of dollars being invested in expanding capacity, even as the International Longshore and Warehouse Union, representing port workers, faces its most serious challenges in many decades.
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THE CITY'S Office of Economic and Workforce Development issues an annual Economic Indicators report. The 2013 edition lauds Oakland's "business retention, expansion and attraction efforts" and "collaborative public/private partnerships" and explains that these focus on the city's "most dynamic" sectors:
Food and Beverage; Wellness/Healthcare; Green/Clean Business Sector; International Trade/Goods Movement; The Creative Economy, comprised of...Technology and its "ecosystem" of software, hardware, social media, communications innovations...Custom, Advanced and Artisan Production and Industrial Arts...Some of these sectors are existing strengths in Oakland; some have the potential to capture the overflow from San Francisco.
While some of these disparate sectors involve educated and relatively privileged labor and some are low-wage, what's consistent about capital's vision of the future is that decent-paying blue-collar and union jobs, relatively accessible to Oakland's residents of color, are to be increasingly automated away. Last year's Bay Area Rapid Transit strike prompted revealing advice from one tech CEO, Richard White: "Get 'em back to work, pay them whatever they want, and then figure out how to automate their jobs so this doesn't happen again."
White's comment conveniently combines a characteristic tech arrogance, a dystopian vision of the future, and a frustration with displays of power by workers who still have the ability to disrupt things. (BART isn't a profit center itself, but with all its lines meeting in Oakland, it, too, is central to the city's efforts to grab part of the Bay Area tech boom.)
The majority of Oakland's current residents are being forced out of their homes in part because they aren't considered "worthy" of a place in the city establishment's plan for economic development.
Both the war efforts and the civil rights movement of the mid-20th century put pressures on the ruling class to build cities around the needs of workers. Cities such as San Francisco had relatively extensive health and human services, public parks and recreational services, and housing was relatively affordable. In Oakland, Henry J. Kaiser built hospitals for his shipyard workers--the same that have become Kaiser Permanente's main business today.
However, as capital shifted from the urban centers to housing development in the suburbs (for profit as well as a variety of political reasons), cities were subject to disinvestment, and their working-class residents--especially Black and Brown people--were left to fend for themselves.
In response to the growing militancy of the civil rights movement, the labor movement and urban rebellions of the late '60s (including the Oakland-born Black Panthers), the state innovated military tactics such as SWAT teams alongside ideological justifications such as the "war on drugs" and a prison-building boom that resulted in the caging of ever-more Black and Brown people. West Oakland was devastated not only by the New Jim Crow, but also by urban renewal projects and freeway and BART construction, which tore up its most thriving sections.
At the same time, "while urban neighborhoods were struggling for survival, capital was circling the sky above, like a vulture, watching and waiting for the right time to strike," in the words of Brooklyn activist Ronnie Flores. With the tech boom, the cycle has turned back from abandonment to gentrification.
Neither disinvestment nor gentrification comes from consumer choices or local government efforts to make streets safer. Rather, both are the result of the capitalist system of production that dominates our cities, shaping and reshaping urban spaces in the interests of capital accumulation. Capitalism searches endlessly for places to invest, creates endless competition and subordinates everything to the profit motive, including our homes, our streets and our neighborhoods.
As we saw in the cities of the postwar era, capitalists will not invest unless they stand to make a profit. Neighborhoods are never rescued for the sake of the populations that have historically inhabited them. Instead, when the time is right to make a profit, a whole arsenal of tactics is deployed to seize neighborhoods from the Black, Brown and poor residents who are seen as obstacles to reaping those profits.
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THIS ARSENAL includes both carrots and sticks--carrots for some, sticks for others.
During the past couple decades, public/private redevelopment partnerships like WOSP have been sold as efforts to enliven bankrupt, decrepit and crime-ridden neighborhoods. These projects vary from seemingly benign events like Art Murmur--an Oakland street festival of food, art and music--and concerts in the park to high-priced retail outlets and housing developments.
Often the idea of cleaning up the neighborhood garners support from at least some residents who justifiably find the status quo unacceptable. Meanwhile, in practice, renters and old retail outlets catering to the population now deemed an "obstacle to growth" are priced out. When resistant residents don't move out in response to indirect pressure, landlords attempt to bribe them or criminally neglect their units to get them to go.
These redevelopment projects are not acts of charity. They are a means for exploiting economic crises, and they are the shiny side of a two-faced coin. Our cities--run down, poverty stricken, suffering from crime induced by state repression--already had shaky legs when they were hammered by the Great Recession of 2008, exacerbating income inequality. Now we are told the only way they can be saved is if they are sold off to the highest bidder.
But why is this fate inevitable? Cities like Oakland, East Los Angeles and Detroit are at or near hubs of financial prosperity. Detroit has the second-largest pool of architectural and engineering capital in the country next to Silicon Valley, the fourth-largest concentration of high-tech jobs, and the fifth-most important financial sector in the country--yet, because it is run in the interests of Wall Street, it has gone bankrupt. Now, to ensure capitalists continue to escape paying the costs of the crisis, Michigan's governor has placed the city under "emergency management."
The people of Detroit really got the raw end of the stick, with their right to vote effectively nullified. Under emergency management, their water services have been privatized, and water costs have skyrocketed. City managers are turning off water for residents that are $150--equivalent to two months--behind in payments. The average resident is $450 behind in payments.
At the same time, the city left the water on in hundreds of abandoned buildings this winter--leading to burst pipes, flooding and frozen water-damaged structures. These properties are now being sold to speculators at dirt cheap prices to be bulldozed and turned into new developments.
This response of the 1 Percent to the aftermath of crisis--like the WOSP plan for new residents to displace the old in Oakland--stands in stark contrast to the response of Richmond's Green Party Mayor Gayle McGlaughlin. McGlaughlin, Richmond city council members and activists attempted to use eminent domain to put victims of the foreclosure crisis back in their homes and on track to paying off their mortgages.
But democracy has been curtailed in Richmond too. The plan has been stalled indefinitely by costly court battles levied by the joint effort of a six-nation army of capitalists, including Pacific Investment Management, BlackRock, DoubleLine Capital, US Bank, Bank of New York Mellon, and Wilmington Trust.
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THE FORCES that tame city governments in order to serve capitalist interests take more subtle forms as well. Attracting private investment is the only way to get access to substantial resources in the American variant of capitalism, so cities compete to draw in capital. Oakland, for example, is competing regionally to attract the spillover from the tech boom across the Bay and battling Los Angeles, Long Beach, Seattle and Vancouver for traffic through the port.
This logic can affect even unions, not to mention liberal politicians. If an impoverished city sees no development of any kind, no gentrification but also no jobs, nobody wins. The threat of abandonment may be mostly a bluff in Oakland, given its geographic placement at the heart of a booming region, but it helps explain the shortsighted support for WOSP by the Alameda County Labor Council. However distant this danger, capital's representatives will always warn of it.
For their part, young workers and people of color tend to see very few carrots and a heavy bundle of sticks. According to the Alameda County Public Health Department, "an African American child born in West Oakland can expect to die 15 years earlier than a white child born in the Oakland Hills." And that Black kid growing up in Oakland without wealth will have an easier path to prison than to a job in the Bay Area's booming tech sector.
WOSP is part of an ever-intensifying trend of state- and corporate-sponsored violence against people of people of color and workers in Oakland. Since the recession, public school closures have hit West and East Oakland the hardest, and Alan Blueford is just one of 29 residents shot at by police between January 2010 and May 2013--12 of whom were people of color and 12 of whom were murdered. Those numbers only include OPD shootings, leaving out Oscar Grant's murder by BART police in January 2009, Raheim Brown's murder by Oakland School District police in March 2011, and Jacorey Calhoun's murder by an Alameda Sheriff's deputy on August 9, 2014.
Local police disproportionately harass, intimidate and abuse the historical population in gentrifying neighborhoods. A few blocks over from South Berkeley, where you might see the occasional cop car, is West Oakland, where the streets are filled with cop cars. As Flores points out:
Gentrification serves the New Jim Crow--the system of discrimination in an apparently "color-blind" society... Residents of targeted neighborhoods become more likely to fall into the hands of the police and the criminal justice system. Thus, the claim that gentrification produces a "safer" neighborhood must be re-examined--for many Black and Brown people, particularly male youth, life becomes even less safe than it was before.
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PEOPLE ARE being forced out, but Oakland is still growing. Who's moving in, and what work are they finding?
In the last decade and at an accelerating rate in recent years, the city has gained some 10,000 professional jobs and almost as many service jobs at the same time that it has lost jobs in the other broad categories tracked by census data. Self-employment grew, and thousands of workers took new jobs in the health-care, information, entertainment, accommodation and food-services industries, while thousands of jobs disappeared from manufacturing, wholesale trade, warehousing and transportation.
Many of these new workers are immigrants, especially in the service sector, where employers are happy to take advantage of more precarious labor in the hope that it will be more easily controlled. More than a quarter of Oakland's population is foreign-born, most from Asia or Latin America. The Asian American, Latin American and foreign-born populations of Oakland all grew both numerically and proportionally during the last decade.
Others are former residents of San Francisco, simultaneously victims of gentrification there and representatives of it in Oakland. Many have a stake in the tech boom and a job that depends on it directly or indirectly--so they have something to lose and they know it. That's also true of many long-time residents of the traditionally middle-class Oakland Hills. But at the same time, most are only getting crumbs from the capitalists' table, and they know that too.
The executives with the $100,000 Tesla roadsters aren't moving out to Oakland; they stay in San Francisco or the more elite suburbs. Oakland gets mostly the second tier--people who would be better off with better public transit and education, health care, a safety net and a more equal distribution of wealth and power.
This is the context in which Occupy Oakland briefly dominated city politics, bringing together residents old and new in a fleeting coalition against the fundamental inequity of the dominant system. It is the context of bitter racial divides, with substantial support for politicians who campaign single-mindedly for hiring more cops.
It's the context in which the media was largely successful last year in demonizing striking BART workers--like other public sector workers, disproportionately Black and Brown--as enemies of transit riders.
But it's also the context in which the Lift Up Oakland initiative to mandate a $12.25 minimum wage with paid sick days looks to have a good chance of passing in November, and in which Dan Siegel's independent campaign for mayor is attracting significant support for a vision radically different from that of the capitalists profiting from Oakland's gentrification.
The fight for the future of Oakland is still undecided.