Ned Resnikoff makes a very important point about the Hollywood strikes (boldface mine):
But one of the most important background conditions for these two strikes is the housing crisis. As labor historian Nelson Lichtenstein recently noted, dizzying housing costs in Southern California have fueled a wave of labor actions that spans industries, from film writers to teachers to hotel workers. Besides Los Angeles, the other major epicenter for the WGA and SAG-AFTRA strikes is New York, which is similarly reeling from the effects of crushing rent inflation.
Writers and actors in the film and television industry have the advantage of organization: They can collectively withhold their labor until studio bosses agree to pay them enough to live in New York and Los Angeles. But artists, like American workers overall, are mostly not unionized. They either practice their craft at a net loss or on the thinnest of margins. The housing crisis has devastated that margin.
In the case of Nic Dyer, a painter who got their start in Baltimore, it has meant the difference between integrating into the New York art world and lingering on the outskirts. Dyer, who uses they/them pronouns, lives more than two miles upstate from the city in Hillsdale, a small town near Hudson. Their rent is $900 per month—a stretch, but far more doable than what they would be paying in Manhattan or Brooklyn.
The trade-off is that they’re far removed from any sort of cohesive artistic community. And that has impacted both their art and their earnings…
This is the story that poet and proto–punk rocker Patti Smith tells in Just Kids, her memoir about her friendship with the photographer Robert Mapplethorpe. One memorable chapter describes renting a room in the Hotel Chelsea, a fixture of the west side of lower Manhattan, and notes that rent was $55 per month. Even adjusted to 2023 dollars, that’s cheap.
This also happened to be one of the most creatively fecund periods in the city’s history. The scene surrounding punk club CBGB was an artistic explosion unto itself, giving us the Talking Heads, The Ramones, Blondie, and Television. Meanwhile, in the same year that CBGB opened its doors, the Bronx was giving birth to hip-hop.
If New York rents back then had been three or four times higher, we probably would have received only a fraction of that extraordinary musical bounty. In fact, we don’t need counterfactuals to see how higher rents would have killed the city’s alternative music scene: Just look at what happened after the New York indie rock boom of the late 1990s and early 2000s. That was the period when The Strokes, the Yeah Yeah Yeahs, TV on the Radio, and LCD Soundsystem first emerged. (Granted, The Strokes were prep school kids.) But by the mid-2000s, the New York scene was losing its preeminence as rising housing costs locked out young musicians.
I would add that it wasn’t just the period of the indie rock boom that was enabled by low housing prices, but the music of the decade before that was too. If you don’t have to give most of your earnings to your landlord, you can get by. It’s not awesome, but you can do it. Once that went away, it became much harder for professions that are economically marginal (though culturally vital) to live in urban areas. High housing prices are also why we saw graduate students strikes in the University of California system:
If my housing costs were double what they were (which adjusted for inflation is what they are–thanks for the information internet!), I don’t see how I could have completed graduate school without going into debt–and that was with roommates. I also remember when I was a post-doc, both the post-docs and graduate students informally organized to get higher wages–and amazingly won*–because they (we) couldn’t afford housing costs (this was a case of a university in an affluent suburban area that didn’t have enough apartments–and the community refused to build more). This also is not a new problem because this was literally decades ago.
I’m not big on the whole ‘Age Cohort Wars’, but I do think many of us not-youngs need to remember how critical affordable, if not always awesome, housing was to a decent quality of life.
One omission: Lower property taxes mean that speculators can hold onto land (and housing) until prices peak. One British study says land appreciation is responsible for 80% of house price appreciation. Naturally neoclassical economics (everyone from Mankiw to Krugman) omits land as a factor of production.
So California’s proposition 13 was exactly the wrong way to control home prices. Less tax payable to the public realm means more of homeowners’ income is available for lenders…the real beneficiaries of that little political manipulation. Lenders love high home prices because it means they can make bigger mortgage loans.
One final note about prop 13: it was a gigantic bonus for commercial property. Residential property is reassessed when it changes hands, but if commercial property owners sell less than 50% of the property, no reassessment occurs. Michael Dell (of Dell computers) bought a Santa Monica hotel so no reassessment occurred by splitting ownership between himself, his wife and a corporation he controls. It’s still assessed at 1978 values. 1978 is when Prop 13 passed. This little trick costs the state $12 billion annually in tax revenue.