The U.S. can’t build the things it needs to flourish in the 21st century, and permitting rules and not-in-my-backyard resistance is to blame, a high-profile economist writes.
Noah Smith, who has a popular Twitter account and runs the Noahpinion blog, writes that the U.S. is a “build-nothing country,” with trouble building housing, transit and semiconductors.
Smith said the latest absurdity was a plan to build student housing in Berkeley being blocked by a court, which said the university had to study whether students themselves were an environmental hazard.
Housing starts still have not recovered to pre-2008 levels and have recently started to deteriorate in the face of surging mortgage rates. But the problem, Smith says, is not just limited to housing. New York’s Second Avenue subway line has become the world’s most expensive subway line, and that overuse of consultants, overly large train stations and poor coordination are driving up transit costs.
Green energy projects, despite ample federal funding, have run into difficulty, which Smith blames on the difficulty in getting parts and materials from China as well as not-in-my-backyard opposition. No green projects have been built after the Inflation Reduction Act allocated $400 billion, a recent Wall Street Journal report found.
NIMBY-ism as it’s called is making it difficult for new transmission lines to be built, and Taiwan Semiconductor
has reported that the cost of building a fab is 4 to 5 times higher in the U.S. than in Taiwan.
“All of these are versions of the same basic story. For decades, I’ve heard progressives, including my friends and relatives, bemoan America’s unwillingness to spend money on things like transit and green energy. But now America is spending all the money, and things still aren’t getting built, because of the country’s broken system of permitting, land use, and development,” said Smith.
The blog provoked a flood of responses on Twitter, including from Tesla and Twitter CEO Elon Musk. “We have made large construction projects almost illegal,” tweeted Musk.
Matt Stoller, the research director for the American Economic Liberties Project, trolled Smith, pointing to earlier tweets from Smith voicing support for so-called friendshoring, referring to offshoring to friendly countries. “Offshoring is offshoring. If you want to build here, build here,” said Stoller.
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