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Ever-growing tech giants have changed the pace and price of life in Silicon Valley

In California’s Silicon Valley, some residents lament the ways industry giants like Facebook and Google are dominating suburban communities like Mountain View, Menlo Park and Palo Alto, by altering the housing markets, creating traffic problems and bringing in a monoculture of tech workers. Special correspondent Spencer Michels reports.

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  • Judy Woodruff:

    Facebook and Google were in the crosshairs of lawmakers on Capitol Hill this week over their advertising policies and what happened with Russian interference in the election. In California, those tech giants are under scrutiny too, in part because of their expanding presence in Silicon Valley. The companies are often accused of dominating, and changing, the communities and housing markets where they are based.

    Special correspondent Spencer Michaels has our report.

  • Spencer Michels:

    The fictional TV show “Silicon Valley” resorted to animation to visually depict the high tech region stretching from San Francisco to San Jose.

    The real Silicon Valley, choked with traffic and lacking enough housing, doesn’t need graphics to illustrate its problems, as it tries to keep its suburban character, while expanding and growing wealthier. A two bedroom apartment here now rents from $3,500 to $4,500 a month.

    Google employs 20,000 workers in the town of Mountain View. It has plans to double or even triple its workforce, a move welcomed by some residents, but feared by others, like Jac Siegel, a retired engineer and former mayor.

  • Former Mayor Jac Siegel, Mountain View:

    It’s just totally changing the nature of where we live, for people, for the sake of Google employment and for the developers who want to make a lot of money, and they do. It’s becoming a town of apartment dwellers more than others. An example; look on the right here; there’s 200 units of apartment buildings and yet minimal parking and no infrastructure.

  • Spencer Michels:

    Part of Google’s expansion is a new headquarters building adjacent to the dozens of buildings it acquired over the past 20 years. Google has also broken ground at nearby Moffett Field, leased from NASA, for another campus, that includes housing.

  • Rebecca Prozan:

    We’re growing every day. We’re excited to be part of the lowest unemployment rate in the Bay Area.

  • Spencer Michels:

    Rebecca Prozan heads local government relations for Google.

  • Rebecca Prozan:

    I look forward to the conversation with Mr. Siegel, with the neighborhood, with the community to figure out what should the future look like.

  • Spencer Michels:

    But Siegel sees Google, which has inspired shopping centers, housing, buildings, roads, turning Mountain View into a company town.

  • Former Mayor Jac Siegel:

     Yes, it is a company town in that it’s controlled by whatever Google wants here, they pretty much get, and by the fact that developers want to support that as much as they can.

  • Spencer Michels:

    Are you going to essentially take over Mountain View?

  • Rebecca Prozan:

    No, we’re not going to take over Mountain View. We want to be thoughtful and intentional about how we are in the community.

  • Spencer Michels:

    A so-called company town like Detroit can be dominated by one industry, like automobiles, says Stanford law professor Michelle Wilde Anderson, who has been studying tensions in Silicon Valley.

  • Michelle Wilde Anderson:

    The anxiety about a company town comes from two things. One is a worry that we’re going to over-rely on single companies or single industries. That’s kind of a Detroit fear. I think part of it is just the fear that Silicon Valley’s people themselves will become a monoculture of tech workers.

  • Spencer Michels:

    One thing Google does want is more housing. It is pushing the city to approve 9,800 new units, some of them below market rate, though the city council wants to slash that number, fearing increased traffic.

  • Rebecca Prozan:

    If the 9,800 units are actually fulfilled and built, we will more than double the amount of affordable housing in Mountain View, so that wouldn’t be just for employees.

  • Spencer Michels:

    Mountain View isn’t the only city being transformed by tech. Facebook is increasingly dominating the towns of Menlo Park, and its neighbor, East Palo Alto. With 5,500 workers, Facebook is well along with construction of a giant new office complex that will bring 12,000 new employees to the flourishing social network.

    But a future plan involves more than offices, says public policy director Michael Matthews.

  • Michael Matthews:

    About half of that space will be for housing, 1,500 units, about 225 of that affordable housing. Retail space. Grocery stores. Possibly a hotel and some other things.

  • Spencer Michels:

    Matthews revealed to us that a giant scale model of Facebook’s new Willow Campus, surrounded by the quickly gentrifying neighborhoods of East Palo Alto and Belle Haven.

    Facebook has pledged $20 million to a community fund for housing, and is trying to get foundations, companies, non- profits, to raise another $55 million for affordable housing, in a market where million dollar homes are average.

    But getting Facebook’s help wasn’t easy, according to Tameeka Bennett, who directs a community action non-profit in East Palo Alto, which traditionally was home to low income people and minorities.

  • Tameeka Bennett:

    We’re a gentrifying city right now, unfortunately, so we have Google, we’ve got Facebook, we’ve got YouTube, and LinkedIn and —

  • Spencer Michels:

    Bennett had to move to Oakland because East Palo Alto became too expensive. But she commutes back every day, to fight to preserve her community.

  • Tameeka Bennett:

    We found out that Facebook was expanding once again. We did have to threaten a lawsuit in order to get them to the table. But to Facebook’s credit, they did decide to talk with us.

  • Michael Matthews:

    We’re open to listening to everybody and figuring out what makes sense; we’re not adversarial about it.

  • Spencer Michels:

    But making sense in a dynamic economy is tough, says Stanford’s Anderson.

  • Michelle Wilde Anderson: 

    People miss a more humble version of Silicon Valley, but the problem is that you can’t have it both ways. We can’t both allow all of this commercial development and these high tech campuses, and not permit the housing, because it falls down hardest on lower paid workers.

  • Spencer Michels:

    She says high tech companies need to explore building far outside the expensive metro areas, and they also have a responsibility.

  • Michelle Wilde Anderson:

    In the modern condition of American inequality and lower- paid workers and super- concentrated wealth, do they have a moral obligation to start really trying to address some of our social problems? Yes. And most importantly they have tremendous capacity to be part of the solution.

  • Spencer Michels:

    Google and Facebook are not the only companies whose expansion are changing the face of what used to be called the Valley of Heart’s Delight. Now, Apple is constructing a huge new building, sometimes called the Death Star, some Space Ship, here in Cupertino. Apple declined our invitation to talk to us about what that means for the community.

    A few miles south, officials in San Jose, the second largest city in the state with 1.1 million residents, are welcoming high tech development. Just beyond the skyline of San Jose’s downtown, Google has proposed another 240-acre campus, with eight million square feet of offices to accommodate 20,000 workers, replacing a jumble of parking lots and small businesses.

    Sam Liccardo, San Jose’s mayor, argues that his city is different than the smaller towns where Google and Facebook grew up.

  • Mayor Sam Liccardo, San Jose:

    The real problem with Silicon Valley’s growth has been that those large companies have gone to the suburbs and that has created the traffic mess. We don’t have those same concerns. We’re the world headquarters for Adobe, and Cisco and PayPal. And so, we welcome the growth. Big cities are where large employers should be.

  • Spencer Michels:

    The transit hub will bring together commuter trains, Bay Area rapid transit, buses, a light rail system and high speed rail. In fact, some observers think workers could commute a hundred miles or more from the Central Valley, if the high speed rail system ever gets built.

    But would 20,000 additional workers and a community with housing, grocery stores, hotels and more constitute a company town?

  • Mayor Sam Liccardo:

    Bring it on! We all would love to see another grocery store downtown. We know our hotels are maxed out, so we need more hotel space, we know that small towns aren’t going to welcome that, and that’s OK with us.

  • Spencer Michels:

    Meanwhile, Amazon is seeking to build another campus away from its base in Seattle, and the scramble among cities throughout the country to secure that plum is under way.

    I’m Spencer Michels for the PBS NewsHour in Silicon Valley, California.

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