Ed Lee and Ron Conway as Evil Plotting Kingpins of San Francisco? Give Me a Break NYT

By Sarah Lacy , written on April 4, 2012

From The News Desk

This is pathetic.

Earlier in PandoDaily's life I wrote that if you say you're creating jobs you can win any debate in politics. I should have added: Anywhere except the overly-progressive madhouse of San Francisco where even toys in Happy Meals are banned.

The New York Times has a bizarre hit piece on San Francisco Mayor Ed Lee, arguing that "people" are raising questions about his making policy moves that benefit Ron Conway. There is one "person" quoted and it's Aaron Peskin: A progressive politician with competing interests. I haven't really heard anyone else talking about this, so it more than reeks of an agenda.

The article references a "controversy" over tax breaks for Zynga and Twitter last year. Um, that was a controversy? Keeping those companies here -- through widely publicized tax breaks -- was a core issue that Lee ran on and a main reason he got elected. I heard people cry corporate welfare. But I never heard a single person cry, "Ron Conway put you up to this!" 

There is literally nothing in the article to back up that this happened or that anyone other than Peskin and the author are even freaking out about Ron Conway's influence in city government. Nothing.

As far as I can tell, the Times is beating Lee up for keeping widely promised campaign promises. Really? We're doing that now?

I have my own agenda too, and unlike the Times piece I'll admit it openly: I voted for Ed Lee, and I thought Peskin and other progressives were awful for the city. While, I'm at it, I'll disclose that Conway's firm is an investor in PandoDaily. And Conway recently roped me into moderating a Chamber of Commerce event, because Lee asked him to help out. (That is nefarious...)

Go ahead and think what you will about this post based on that. But there's a pretty long paper trail of my bitching that the city should embrace tech entrepreneurs, not vilify them. It well predates either of those actions.

But this is San Francisco. Where people threatened to spit on a coffee cart because it was too successful. So I shouldn't be surprised.

It's past midnight and I just put a baby to bed who'll be awake again in a few hours. So I'll be brief in my rant. (Correction: I am reading over this now and I wasn't brief at all.) I've written thousands of words in the last few years about the bizarre difference between Silicon Valley and San Francisco despite the geographical overlap. I've long thought it was bizarre that Silicon Valley holds up people who can create huge companies out of nothing as heroes, and San Francisco tears them down as juicy targets who owe the city their whole coffers in tax revenues for the pleasure of living here and driving on its pot-hole ridden streets. And I'm proud to say that our investigation at TechCrunch into the city's right to tax stock options helped change city policy and helped loads of startups.

A few other points:

1. Conway is the single most prolific investor in Silicon Valley. (Yep, he invested in us too!) To say you are creating policy to benefit "his companies" pretty much means you are creating policy to benefit the bulk of the entire startup ecosystem. Technology has been responsible for almost all of the job creation in San Francisco, as industries like banking and media have eroded over more than a decade, and this downturn has hit retail and construction jobs.

So why exactly is tailoring policies to benefit the tech industry a bad move for a mayor? Do you know what any other city in the US would do to attract just one of these names?

Reminder: No other city in the nation has the kinds of taxes on business that San Francisco has. San Francisco is seven miles by seven miles. If a company can avoid these taxes by moving -- literally -- a few miles to the East, South, or North, that's your fiduciary duty as a business. That takes jobs from San Francisco. Those are just realities.

Want proof this could happen? Look at the entire history of Silicon Valley. Only recently have the largest companies been located in San Francisco. The Valley wants to be in the City right now, no doubt. But the City needs the Valley more.

You want to say companies are greedy and just not "paying their share"? Fine. Then if you believe they are greedy, believe they'll move. Do you want the jobs or not? Because a neighboring city will take them. Any city in the country would take them.

What's more, Conway's initiative is geared at bridging the disconnect between all the open jobs in the tech ecosystem and people who are out of work via job training. Again, I'm missing how that's a bad thing. It doesn't stop at rewarding the people who are creating thousands of jobs and the people who work for them -- which I'd be fine with. It seeks to pull more people into those companies.

2. The reason I support Uber and Square over the San Francisco taxi lobby is first as a person who thinks that most markets are better off when startups are allowed to compete with the protected, antiquated status quo. The second reason I support them is I live here, and San Francisco has one of the worst taxi infrastructures in the world.

There are not enough cabs, and the lobby is loathe to offer new medallions, because the drivers don't want competition for fares. The rates are insanely high compared to most US cities. There aren't many of the basic consumer protections other cities have, like a standard fee from the airport. And God forbid, you want to pay with a credit card. You might as well have insulted a cab driver's mother.

Taxis in San Francisco have been protected and have done things based on what helps them, not city residents. The only thing the will force them to change is competition. It's high time the city enabled it.

3. Is Lee corrupt? I don't think he is. The idea that he's sitting around awaiting orders from Conway would be comical, if it weren't such an offensive, self-interested accusation by a competitive politician. Why would Conway so constantly publicly endorse and appear with Lee if there was something nefarious going on? (Haven't you people watched an episode of "Boss"?)

But while I know Conway's character, admittedly I don't know Lee very well. I certainly haven't spent months infiltrating and investigating his regime. Maybe he is corrupt in some way. This is San Francisco after all: This is a city that's pendulum swing is from outrageously don't-sell-Happy-Meal-toys-here progressive to merely yay-gay-rights liberal. What's conservative here is liberal in the rest of the US. A single party always being in power tends to breed corruption.

But more to the point, does it really matter? Lee is finally speaking to people like me: Home owners and business owners who invest in the city. There are a bevy of examples of this that have nothing to do with Conway's investments. For one, he's working to bring high-speed rail between LA and San Francisco, so airlines will offer fewer commuter flights between the two cities. This will open up our limited runways for more international flights. This is something I've complained about for years.

Is Lee making these moves, because I'm one of Conway's portfolio companies? Of course not. He's doing it because it makes sense, and he promised it during his campaign.

I understand, if you disagree with me politically. But let's not pretend Conway is the only one who supported Lee, hoping for change. Isn't the more obvious explanation that he's doing what the people who put him in office asked him to do? Not the people who backed his campaign financially like Conway, the people who voted for him hoping common sense would return to the city, like me.

(I mostly wrote this because Brian Lam asked repeatedly on Twitter. I realize taking personal requests isn't a sustainable way to build an audience, but never let it be said that I don't aim to please each and every reader.)