The Bay Area Council began as the brainchild of large employers headquartered in the region. They envisioned a successful, affluent, innovative region and their foresight was prophetic.
Founded in 1945, the Bay Area Council has led the business community in supporting well-developed regional public policy. The history of the Bay Area Council is also the history of Bay Area business, which has thrived in the unique land that faces the San Francisco Bay.
In 1995, the Bay Area Council commissioned Bay Area writer and commentator Richard Rapaport to write a retrospective of Bay Area business. The resulting 50-year history, provided below, was first printed in the special report published on the 50th anniversary of the founding of the Bay Area Council.
The Bay Area—50 Years After
Few American celebrations have received quite as much attention as this year’s fiftieth anniversary commemorations of the events of 1945. Which is as it should be. 1945 was one of the authentic turning points in world history—celebrating as it did, victory in the world’s most terrible war, marking the beginning of the nuclear age and the inauguration of the United Nations. 1945 also marked the beginning of our modern era—Year One of an age that brought: television; colonialism’s demise; the population explosion; antibiotics; the Cold War; rock and roll; the suburbs; HMOs; the civil rights, women’s, environmental and fundamentalist movements; computers; biotech; space travel and much, much more. To say that life is very different than it was fifty years ago is an understatement. But it is no understatement to suggest that few regions in the nation have been so influential in bringing about that change as the San Francisco Bay Area.
It has been said that new trends in America are invented in the Bay Area, amplified in L.A. and then broadcast from New York. This is clearly a quipster’s view of America’s intricate pluralism. Still, it is an appealing notion that there is a unique Bay Area style caused by some mysterious bromide carried through the air, water, fog, or perhaps in the sourdough bread starter.
It is a germ that causes Bay Area citizens to think more freely, create more innovatively and celebrate their individuality with a passion at once ennobling, enriching, and often, a pain in the butt. It is not coincidental that the Bay Area has more Nobel Prize winners, more successful technology companies, the largest number of computers per capita in the world, more activists, far more political jurisdictions and fewer new freeways than any other major urban region in the nation. All of which is illustrative of the spirit of a region that has shrugged off natural and man-made disasters, weathered economic ups and downs and embraced social upheaval in order to carry on its own unique brand of living and a spirit of innovation and enterprise envied (and copied) by the world at large.
In June 1945, that world beat a path to San Francisco for the signing of the United Nations Charter. The war to defeat Japan in the Pacific was the beginning of America’s shift in focus from the previous century’s Eurocentricism to the beginning of a new global view. Where better to begin that post-war world overture than in America’s most diverse and forward-thinking region?
Nor is it coincidental that 1945 was the year that the executives from leading Bay Area companies including Bank of America, American Trust Company (later merged into Wells Fargo), Bechtel, FMC, PG&E, Henry J. Kaiser Co., Fireman’s Fund, Southern Pacific and others, gathered with their political and academic peers to contemplate the enormous changes that had been wrought in the nine-country Bay Region during four years.
These were among the founders of the Bay Area Council, and in their prescience, they strove to grasp what they knew would be the even more momentous growth, change and maturation that seemed inevitably to lie ahead for the region. Their post-war vision was of an economically prosperous nine-county Bay Region that could work together, within the same regional framework, to confront transportation, pollution, urbanization, open space, land and water uses and other problems best dealt with on a regional basis. Like the rest of America in the early 1940s, the pre-war Bay Area had been ill-prepared for war. Months before Pearl Harbor, a Congressional committee had deplaned here to determine how well the infrastructure of the 1.7 million population Bay Region would take a quantum increase in arms-related industries. The lawmakers found the region’s infrastructure strained to the breaking pint, and determined— incorrectly, as it turned out—that no more war production should be planned for the Bay Area.
The coming of the war in December 1941 changed everything. It was inevitable that the Bay Area—with one of the greatest natural harbors in the world, and a resourceful and educated populace—would become the Pacific Coast foundry and transshipment point for the greatest war effort in history. Local industrial leaders like Henry Kaiser and Stephen Bechtel, Sr. made certain that the Bay Area did just that. During the course of the war, some 996 new merchant ships came down the ways of six Bay Area shipyards, in addition to Navy vessels produced at Mare Island and Hunter’s Point Naval Shipyards. By 1945, the vast regional war effort changed the Bay Area forever, launching it on a trajectory to dominance in a staggering variety of fields and endeavors.
By the war’s end, the region’s population had increased to 2.1 million, with many new residents still living in the substandard temporary housing thrown up for war industry workers. Just before V-J day, a New York Herald Tribune reporter visited the Bay Area and found that the “need for shelter has swollen most of the towns on the shore to bursting.”
The peacetime building boom was on, with most war workers choosing to demobilize in a locale where extraordinary climate and vistas were matched by educational and economic opportunities. Even more of a magnet was the sense that in Northern California there existed a freshness, a willingness to experiment and a Gold Rush gambler’s tolerance that opened possibilities that the congested East never could. Many returning GIs, who had fallen for the Bay Area before shipping off to the Pacific war, also chose to return.
These new arrivals, along with hundreds of thousands of inner Bay Area residents, began the en masse migration to newly-developed subdivisions in Daly City, Hayward, Walnut Creek, San Rafael and across the Santa Clara Valley. They were aided by mega-developers like Joseph Eichler and Henry Doelger, whose “ticky-tacky boxes” on the Daly City hillsides inspired folk singer Malvina Reynolds to write “Little Boxes,” the anthem of the no-growth movement that would bud in the Bay Area in the ’60s.
Retail development naturally followed the suburban exodus, and David Bohannon’s Hillsdale Shopping Center, completed in the 1950s, was one of the first regional retail malls in the nation. Industry, too, began to desert the Bay’s inner cities. Between 1944 and 1950, well over one hundred corporations opened plants in and around the apricot and prune orchards of Santa Clara, then known as “The Valley of Heart’s Delight” and soon to be renamed—and renowned as—“Silicon Valley.”
Among these new companies was a small technology firm founded in 1939 by two Stanford graduates, William Hewlett and David Packard. Beginning in the now-fabled garage behind a cottage on Addison Avenue in Palo Alto, the two turned their small electronics manufacturing business into what is today the $25 billion-in-sales international giant, Hewlett-Packard.
Hewlett, Packard, brothers Sigurd and Russell Varian, whose invention of the klystron tube was a primary impetus for the birth of electronic warfare, and many others were the intellectual offspring of Fredrick Terman, a dean at Stanford University. It was Terman’s interest in providing Stanford graduates with nearby job prospects that fostered a link between Stanford and the nascent electronics industry, leading the creation in 1951 of what was then called the Stanford Industrial Park. Located on Stanford land adjacent to the campus, it would be the seedbed from which Silicon Valley would sprout its micro-electronic stalks.
Over the course of four decades, garage-born, Santa Clara-based technology would become a paradigm for successful late twentieth century industrial development. Out of those garages and workshops issued forth such world-leading technology companies as Apple, Intel, National Semiconductor, Sun Microsystems, Oracle, Silicon Graphics and others.
At the same time that Silicon Valley was beginning its rise, San Francisco and Oakland were becoming increasingly important headquarters cities. In San Francisco, companies like Pacific Gas & Electric, Bank of America, Standard Oil of California (which became Chevron), Wells Fargo Bank, Transamerica and Pacific Telephone were providing jobs, a steady tax base, and forward-looking support for the region’s increasingly recognized cultural institutions. San Francisco also enjoyed a reputation as the financial capital of the west.
Oakland, too, was similarly endowed with key corporate headquarters like those of Safeway, Clorox, American President Companies and Dreyer’s Grand Ice Cream. Throughout the years, Oakland has been home to a diverse family of Kaiser companies, including Kaiser Permanente—also born in 1945, and possibly the most innovative and successful health care organization in the nation, as well as the model for today’s HMOs.
Post-war prosperity made the Bay Area not only a highly desirable place to live and work, but also a center of national culture and entertainment. Intercontinental television broadcasts beginning in the ’50s brought the San Francisco Opera and Symphony to the attention of viewers across the country. The Bay Area also gained increased visibility among sports fans and franchise owners. In 1950, the football 49ers were welcomed into the NFL. In 1958, the baseball Giants were traded New York for San Francisco, and ten years later, Charles O. Finley moved Athletics to Oakland. Also in the ’60s, both NBA basketball and NHL hockey became Bay Area realities. And although NHL Hockey did not initially stick, the sport gave the Bay Area a second chance with the birth of the San Jose Sharks in 1991.
Bay Area prosperity and recognition, however propitious, brought with it inevitable problems of congestion, pollution and haphazard land use. Beginning in the late ’40s and repeated over the next forty years, there would be myriad attempts to find a workable balance between the necessity for development and the problems of growth. But all attempts to rationalize expansion in the region were made far more intractable because of the crazy quilt of more than 875 individual political jurisdictions that marked (and still mark) the Bay Area as the most politically-fragmented region in the nation.
From the ’40s through the ’60s, a score of single purpose governmental agencies were formed to try to deal with these problems—among them, the Bay Area Air Quality Management District and the Bay Conservation and Development Commission.
But possibly the most difficult problem of all was that of creating a true regional mass transit system. Any attempt to recreate Bay Area transit in the manner of New York’s all-powerful Port Authority was doomed by some 45 different transit authorities, each only capable of working a small piece of what has always needed to be an overall regional solution. Beginning in the late ’40s, the Bay Area Council and others began planning a nine-county Bay Area Rapid Transit system—gradually whittled down until two decades later it was realized as the three-county BART system, that has since added San Mateo County. The formation of the nine-county Metropolitan Transportation Commission, and a regional transportation plan, came to fruition in the early ’70s.
The long-time goal of regional planning gained serious attention in 1959, when the Bay Area Council proposed to put all bridges, airports and seaports under a single Golden Gate Authority. While the GGA legislation did not come to pass, it led to the formation of the Association of Bay Area Governments.
Local political rivalries are part of the explanation for the inability of the Bay Area population to coalesce around regional issues. But better answers may lie in an anti-establishment “live and let live” sensibility that has permeated the region since the days of the Gold Rush.
More to the point, according to some, is the exceptionally high education level in the Bay Area results in a well informed, highly-motivated, but often contrary electorate.
The “don’t tread on me” attitude expressed itself in the early 1950s, in the civil reception given to victims of the anti-Communist. And it asserted itself even more forcefully in the so-called “Freeway Revolts” that began in Santa Rosa in 1956, spread to Marin and San Francisco, and by the early 1960s managed to stop major highway projects throughout the Bay Area.
It was the birth of the “Not In My Back Yard” syndrome that has since become a major stumbling block to development across the country. And if the roots of “NIMBYism” can be traced directly back to the ’50s and ’60s Bay Area, so too is set here the foundation of the student anti-war movement that shook America in the ’60s.
The 1960s “youthquake” took firm root in Berkeley with the Free Speech Movement, and then in San Francisco with “Haight-Ashbury” becoming the primary symbol and locale for the “peace and love” hippie phenomenon. Local groups like the Grateful Dead, Big Brother and the Holding Company and the Jefferson Airplane did nothing less than define the music of a generation. Defining the music business of that generation was a San Francisco-based impresario named Bill Graham, who did for rock and roll, what Hewlett and Packard had done for electronics.
Ironically, it was the young followers of the ’60s non-conventional lifestyles, who would become the advance troops for the personal computer revolutions that began in the early 1980s, and brought the next wave of industrial to the Bay Area. It is these Berkeley/Palo Alto “longhairs” like Steve Jobs, Steve Wozinak, Nolan Bushnell, Vinod Kholsa, Bill Joy and others who created the “insanely great” products like the Apple Macintosh, the Atari, and the Sun workstation.
It is unlikely that the information technology revolution would have taken place at all without innovative Bay Area investors like Arthur Rock, Tom Perkins and Bill Hambrecht, who virtually invented the field known today as venture capital as a means of funding new growth enterprises—particularly those in the technology field. Other investment banking firms, like Montgomery Securities, Robertson, Stephens & Company and Hellman & Friedman, along with Hambrecht & Quist, helped transform the Bay Area into a center of investment prowess. At the same time, exciting innovations in money management were taking place. Franklin Resources was on its way to becoming one of the largest mutual fund companies in the world, while Charles Schwab was transforming his name into a symbol for discount brokerage fees and fast, easy stock transactions.
Close collaborations between capital, private industry, the Bay Area’s universities, and national and private laboratories like Lawrence Livermore, Xerox PARC and SRI International were leading to innovations in computer sciences and other technical fields.
In pharmaceuticals, Palo Alto’s Syntex produced the first birth control pill, while gene splicing and recombinant experiments at Stanford and UCSF in the late 1970s, led to the creation of pioneering biotechology companies like Genetech and Chiron, and the biomedical drug industry, led by ALZA and many spinoffs.
The partnering of art and technology led to a number of successful computer game and video graphics start-ups, like Macromedia and George Lucas’ Industrial Light and Magic. An explosion of computer graphics companies centered around San Francisco’s South of Market district, that became known, from the early 90s on, as “Multimedia Gulch.” Wired Magazine has become the voice of the new on-line generation.
The creation of hundreds of successful Bay Area technology companies—many of which, by the mid-1980s had taken their place in the Fortune 500 list—helped to offset another less positive trend. In the mid-to-late 80s, the Bay Area found itself reeling from the acquisition of some of its most venerable firms, including Del Monte, Southern Pacific, Crown Zellerbach and Pacific Lumber.
Throughout the decade, another business trend saw a number of Bay Area companies shifting their operations out of central cities into formerly rural parts of the Bay Area. Once pastoral like the 680 corridor in Contra Costa County, Route 101 in northern Marin County and Highway 280 in Santa Clara County became instant “urbs” creating their own micro companies with attendant growth problems.
If there was an upside to this diversification, it was that cities throughout the region began developing their own industrial bases and unique identities. The Port of Oakland grew into one of the premier working seaports on the West Coast. By the mid-1990s, San Jose rose to become a major-league city, due largely to the growth in the Santa Clara Valley. The Sharks’ remarkable Stanley Cup playoff appearances in 1994 and 1995 seemed emblematic of a San Jose that had taken place as a major Bay Area urban force.
Today, fifty years after the seminal year 1945, the San Francisco Bay Area—with its crammed highways, the highest housing costs in the nation, and a political system that makes “balkanization” pale in comparison—has lost little of its charm and its economic attraction. With a present day population of more than six million, three times the pre-World War II figure, the Bay Area remains one of the best, most highly-prized and gracious places in the world to live. It is also a good place to start a company or begin a career.
Through recession and business cycles, Silicon Valley maintains its preeminence as the world’s greatest technology region. San Francisco, Oakland and San Jose are all leading headquarters cities, with world-class regional amenities, including a half dozen major art museums, and three distinguished symphonies, along with a nationally-recognized ballet and modern dance companies. The Bay Area also has become home to some of the most renowned and innovative restaurants in the nation, influenced by Alice Waters’ Chez Panisse, the Berkeley-based mother ship of what has become “California Cuisine.” Even the occasional natural disaster hasn’t lessened the Bay Area’s magnetism for tourism and convention-goers from around the world.
Napa and Sonoma have taken their rightful places among the world’s most select wine producing regions, while film makers like George Lucas, Francis Ford Coppola and Wayne Wang still draw inspiration and material from their home region. The Nobel Prize and MacArthur “Genius” Award chronicles are heavy with Bay Area notables, while both of California’s current U.S. Senators are from the Bay Area. The Bay Area is home to some of the most successful and innovative apparel manufacturers in the world including The Gap and Levi Strauss.
The beat, as they used to say, goes on. Some of America’s leading management and campaign consultants call the Bay Area home. Bay Area advertising is represented by Hal Riney & Partners and Goodby, Silverstein & Partners. Architechture and design firms like Skidmore Owings & Merrill, Kaplan McLaughlin Diaz, Gensler and Associates/Architects and Landor Associtates, have taken the indigenous Bay Area design and architectural standards and exported them around the world.
In total, the Bay Area seems to have weathered well the half-century of social, economic and political tempests that have swept the globe. In general, the San Francisco Bay Area is in good shape (but perhaps not in great shape) as it prepares for the inevitable surprises the next fifty have in store.
The Bay Area has been better at living off its charm than it has been at listening and acting on the tough messages of regional Jeremiahs like the Bay Area Council. It is clear that we, as a region, will have to do better in the future to maintain the standards that have been set in the last half century.
By most accounts, the region’s quality of life is in some jeopardy. For the Bay Area Council to be able to write as glowing a one hundred years’ perspective in the year 2045, it will be necessary for our region to address the whole range of issues: the sustenance of our economy; the education of our youth; the movement of people and goods; the wiser use of our land; the improvement of our physical environment; the assimilation of our ever-diverse population, and the development of a civility—a sense of responsibility and sharing—among Bay Area residents.
Still, it can be said with confidence that when the Bay Area Council does publish its one hundred year retrospective, the singular style of this region’s work and life celebrated in 1945—and envied today—will be a subject of admiration, adulation and celebration still.