The City’s endless war on creativity 

It should be obvious, but to much of The City’s political class it painfully is not. Small businesses — defined as employing fewer than 100 people — keep vibrant in countless ways that larger corporations cannot. They even survive recessions better, according to a study presented to City Hall this week.

A metropolitan area that prizes creativity, as San Francisco does famously enough, ought to be treating its entrepreneurs with far more tenderness and understanding. And it ought, as economist Kent Sims and Cal Insurance President Scott Hauge argue, include more small business representation in its policy deliberations.

At a City Hall press conference, the two reported their finding that, during the 2000-04 recession, small businesses laid off 10 percent of their workers, while larger companies cut their forces by more than 20 percent. That would seem an arresting figure — unless you understand the special dynamism of shop owners and other self-starters.

To the politically tone-deaf — and we’re glad Supervisor Chris Daly attended the event, as did a representative of Mayor Gavin Newsom — the study could send exactly the wrong message: If The City’s small-business sector shows such vigor (and such a popular fallacy is not hard to imagine), then the tax and regulatory climate must be copacetic; nothing needs changing.

Some might follow such logic all the way out the window: Why worry that more large corporations, if they haven’t done so already, contemplate taking their headquarters far beyond the city limits? After all, those colorful micro-enterprises, the tourism industry as their accomplices, will see us through.

Do municipal officials really think in such self-destructive terms? We’re afraid so. Our suspicions were confirmed to us recently by one candid department head, among other unblinkered observers. Turns out, an anti-business posture is a matter of pride peculiar to this land between the bridges. And it is not at all clear that we can keep small-business owners happy with the status quo.

That status quo now must include an oppressive health care plan, the mere anticipation of which dampens creative planning. It includes bizarre rules concerning which neighborhoods are open to which businesses — rules that substitute political whim for market demand. Some business-friendlier cities announce parking-meter holidays; ours considers a fee increase.

Even rental-property owners are small-business people. It takes some effort to fathom the political calculations behind, say, Supervisor Tom Ammiano’s proposal to split the cost of bonds between them and their tenants. But ultimately the cost of the entire rent-control regimen is borne by renters themselves in lost quality and availability.

And on and on. Again, we’re talking about creative people, from the Eastern European émigré who replaces your wristwatch batteries to the chef-owner serving a salty/sweet, lavender-infused rhubarb frappé. Their labors should be liberated, their decisions depoliticized.

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Staff Report

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A daily newspaper covering San Francisco, San Mateo County and serving Alameda, Marin and Santa Clara counties.
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