Unexpected Revolutionaries

WHEN I MOVED TO CALIFORNIA, coworkers advised my husband and me to buy property as quickly as possible because house prices in the Bay Area rose faster than wages. We bought a two-bedroom condo in ’75 and replaced it with a three-bedroom house costing 37 percent more the following year. We upgraded to a slightly larger three-bedroom the following year at a price higher by 47 percent. Our rapidly growing equity made this possible even before there were no-down, delayed-interest loans.

I was reminded of this personal history when editing the articles on social activism in this issue. Until the late 1970s, I thought all activists wore their hair long and chanted slogans as they marched in the streets. In 1978 California, however, the activists turned out to be my preppy-dressed, 9-to-5-working neighbors. In those days, property taxes were skyrocketing with home prices, so much so that local city and school officials could pat themselves on the back for keeping tax rates unchanged while adding millions of dollars to each year’s budget. Homeowners, meanwhile, were cursing as they wrote ever-larger checks to the tax collector. A couple of activists named Jarvis and Gann saw a hot cause in the making, and 31 years later, the taxpayer revolt they led (known as Proposition 13, which placed state constitutional limits on property tax rates and assessed value of real estate until a property changes hands) still shapes public finance. It also keeps many Californians, like me, from changing homes because of the tax implications.

This is an example of social activism reshaping not just the public sector but also the private. Business School Professors Hayagreeva Rao and Sarah Soule are specialists in how social movements create lasting change. In his new book, which he discusses on page 14, Rao explains how group identities formed around a hot cause can reshape markets for products such as automobiles, wine, and medical devices. On page 24, Soule explains that social activists are most effective before they become too radical and develop more critics. (She reminds me that the property tax revolt spread from 1978 California, but later anti-tax ballot measures were less extreme.)

She is team-teaching a new seminar this fall with Professor Jesper Sørensen on “social networks, careers, and markets” that will explore, among other things, new internet tools of social coordination such as Twitter, Ning, and LinkedIn.

In this issue we also present examples of social activism by alumni and students. On page 10, you can read about alums who are working to reshape what we eat, which affects the agriculture and food processing industries. On page 12, we describe students learning how to design products or services that they hope will improve the lives of the world’s extreme poor. Some may be designing handheld grinders or fuel pellets in order to make a financial profit, but others, clearly, are motivated by a desire to change the social status quo. On page 20, we describe other students enrolled in a new joint degree program that they hope will allow them to improve natural resource use and the environment.

In thinking back to ’78, I am reminded how local officials were blindsided by the movement that led to Proposition 13. At the time, I was a newspaper reporter covering local governments, and rarely saw citizens show up at hearings to testify against taxes. The meetings were mostly dominated by business people seeking licenses, contracts, or zoning changes. The game changers were not in the room, and that is a lesson history keeps repeating.

— Kathleen O'Toole, Editor, Stanford Business magazine

Stanford Business magazine

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Unexpected Revolutionaries