POSTCARD FROM SAN FRANCISCO: The New New Economy

SAN FRANCISCO—“Learn to love your new economy. With proper care and maintenance it should last and last.”

I couldn’t believe it. These, and the name of the place I work for, were the only words printed on the sheet of newsprint taped to the wall above my desk. All I could think of on my first day was, “Why?”

Not “why would anyone think to publish this ad?” because that’s not that important. It was printed last October, and was maybe a testament to the high-flying optimism that had gripped Silicon Valley and Wall Street for four years. Or maybe it was a brand of “new economy” gospel. Or, heck, maybe it was for the 15 minutes of fame in the A section of the Wall Street Journal.

No, the question I had in my mind was, why would someone decide to put the nine-month-old ad on the wall in the first place? Was someone trying to be funny? Was someone trying to point out the irony? Or was someone just a little angry?

“The New Economy”, with a capital N and E (not to be mistaken for any old “new” economy, mind you), was coined a few years ago to describe the world of the late 90s and early 2000—a world of near-zero inflation, ultra-low unemployment and unparalleled and seemingly unstoppable growth. It was a world changed dramatically by the rapid, almost dizzying pace of technological innovation, jump-started by the maturation of the Internet and the rise of global communications. From these initial seeds of growth and promise came a vision of sustained productivity and prosperity for years, if not decades, to come. And here in sunny Bay Area, Ground Zero of the silicon revolution, that dream took flight carrying with it the hopes and aspirations of millions.

Today, nearly a full year after that very dream came hurtling back to reality, San Francisco and its environs is a far different place. And depending on the way you look at it, this may very well have been the best and worst summer to come out West—I can safely say I’m not deluded by the irrational exuberance that had swept through the area in the late 90s, but, at the same time, I have to deal the aftermath of the storm. And it isn’t pretty.

I arrived with bright eyes and big hopes, thinking that perhaps I could catch one tiny bit of the silicon magic that created empires out of thin air and made kings out of financiers and entrepreneurs. After all, less than a year before money had flowed everywhere, and it seemed the “dollar and a dream” was no fantasy—it was reality. Any bright-eyed dreamer or college drop-out with an idea—Sell books online! Deliver groceries over the web! A virtual petstore? Sure, why not?—could get millions (millions!) thrown at him. The American Dream! How quickly it could be realized.

How quickly it could be lost.

Weeks before I arrived, my company laid off 400 people—half of its staff. My group shrunk from 15 to just four members. My roommate out here works—or shall I now say “worked”—for a seasoned, established startup (read: five years old, and still in business). He would wake up each morning not knowing if he would still have a job at the end of the day. For him, it was just a matter of going to work, closing deals and praying that whatever business he brought in would save him from the executioner’s axe, for at least another day. Soon it became a joke—“I have to get to work by 8:30 this morning to get fired,” he would constantly say. Three weeks ago, the joke became reality.

So what happened? People don’t really know. The closest I’ve come to an answer was that the castle on a cloud we lived in wasn’t built on a solid foundation, but rather on unrestrained optimism, mass hysteria and, above all, pure greed. We knew in the back of our minds that this insane growth and prodigal lifestyle couldn’t last forever, yet the belief that the cow could be milked one day longer despite warning signs to the contrary made the fall that much more difficult. Of course, this truth doesn’t do anything to dispel the bitterness and depression that has taken hold of the Bay. There is a silent anger in the eyes of nearly everyone who works here—the techies who ride the buses, the bankers who walk the streets, even the cabbies who plague the roads (“So damn hard to get a fare these days,” a driver once growled to me)—and they all have stories to tell of not even just fortunes lost, but of simple difficulties making ends meet when businesses are cutting back, prices are still sky high and the end is nowhere in sight.

Maybe some were tricked into coming out West, goaded on by the same visions of utopia that I was. Or maybe some were here before the gold rush, saw the roller-coaster ride pass them by and now are just trying to pick up the pieces. Or at least trying to understand why they couldn’t have been one of the lucky few to make it big. What really matters, though—and what is so easy to overlook—is no one party or group is to blame: everyone here probably had something to do with it. But this isn’t an easy truth to swallow. For those who saw their closest friends thrown out of their jobs and apartments, and for those who had already left behind everything to seek out a life in the Bay Area, believing that no one’s to blame is hard. Scapegoats should be everywhere—yet are nowhere to be found.

Truth be told, I’m seeing the tail end of it now—the worst of it has passed. Even so, people are still seething to themselves, silently hating their jobs and the companies that hacked away their own people, actively seeking headhunters or packing their bags and hopping on a flight out of here. But it was when the atmosphere of turmoil was much worse back in the spring that a coworker had dug out the old newspaper advertisement and had pasted it on the wall. For, as someone later explained to me, “What better than irony to get across the bitterness and frustration at a life that seems so unfair?”

The marketing guy who came up with the “new economy ad” no longer works here. No, he wasn’t fired, but about three weeks into my summer, he decided to pack his bags and return to Apple. I can only fathom that the fantasy utopia still lives on there, in ultra-hip advertising and candy colored computer shells.

But for the rest of us who can’t seem to escape to protective bubbles of security, the palette isn’t cherry reds or tangerine oranges or berry blues. It’s the cold grays of the San Francisco fog that rolls in every morning, reminding us that regardless of what might have been a year or two ago, what really matters is what the world is like today.

Welcome to the new economy. It sure seems a lot like the old.

Robin S. Lee ’03, an economics and mathematics concentrator in Eliot House, is design chair of The Crimson.