Progressives don’t have to be afraid of economic development, don’t have to be afraid of promoting business and creating private-sector employment. And we don’t have to be terrified of a mayor who wants to label anyone who opposes Reagan-era economic policies as anti-jobs.
The thing is, San Francisco needs to promote the biggest engine of new employment — small business — and needs to encourage entrepreneurship and innovation. But there’s enough good economic science out there, enough evidence of what works and what doesn’t, that we don’t have to be stupid.
The most obvious example of that is tax cuts. We talk about the mayor’s tax plans this week — and what’s most remarkable is the consensus among economists, even the city’s own economist, that what Newsom is proposing won’t work.
If cutting specific taxes for certain businesses — say, waiving the 1.5 percent payroll tax for biotech — would actually lead local companies to hire hundreds of new people, it might be worth the budget pain. But that’s not going to happen. If allowing developers to pay their affordable housing fees years down the road would put thousands of construction workers back on the job, you could make the case for it — but nobody with any sense really thinks that’s likely.
What do we know would create employment opportunities? Well, a giant affordable housing bond, hundreds of millions in city money going to build new apartments, would generate construction jobs. But what most small businesses really need, what would really encourage hiring, is credit. If San Francisco took the money it’s going to expend (and tax cuts are an expense; let’s be honest) and put all of it into a revolving microloan fund for community businesses, we’d get a lot more jobs. In fact, almost any way that San Francisco spends that money on direct services would create more jobs than these tax cuts.
That’s not politics or ideology or anything else. It’s just reality.