Last week I mentioned the worst economic proposal of the candidates, so in contrast today I’ll mention the best.
Democratic presidential nominee Kamala Harris’ plan to support the building of 3 million new housing units is it.
YIMBYism and Texas
One of my strongest held economic growth views, solidified over the last 15 years in Texas, is about housing.
My theory is entirely too reductive, but I have come to believe that the key to Texas’ astonishing economic strength is housing, and specifically the ease with which it can be built. This keeps housing affordable relative to other places, which attracts newcomers, which in turn spurs growth, in a virtuous cycle of economic development.
By contrast, I moved here from New York City 15 years ago. A big reason why housing is so expensive in New York, and California, and my hometown in Massachusetts, is that it’s too darn difficult to build new housing. There is something about all the zoning, the regulations, the permitting, and the scope for local objections that all adds up. A culture of NIMBY (Not In My Back Yard), expressed by both local government and by neighbors able to block new projects, prevails. The local administrative state raises the cost of new construction to the point where housing is chronically underbuilt in those areas. Which leads to unaffordable housing.
The backlash movement to this chronic problem, whose worldview I have come to adopt, is known as YIMBY (Yes In My Back Yard).
Texas, in contrast to these high-cost-of-housing places, seems highly capable of increasing housing supply as the demand increases. I think the state’s YIMBY approach is really working here. Sometimes (again, I know this is too simple, but I like simple) I think efficient home building is the single greatest comparative advantage of Texas versus slower-growth places.
Harris’ housing policy
So that’s the background to my excitement over Democratic candidate Harris’ policy announcement this month of a plan to encourage 3 million more housing units to be built.
As a former Democratic Senator from California, the epicenter of NIMBY, Harris was not necessarily an expected advocate for YIMBY zoning reform. Which, from a messaging perspective, might make it even more important. Democrats at the national level seem to be getting the message.
In 2022, the Biden administration announced a federal focus on affordable housing as a mechanism for making housing more, well, affordable.
Reading that laundry list of 2022 “pro-housing” policies feels extremely on-brand for traditional Democratic thinking, which is to say, the proposal and implementation of 33 distinct well-meaning, micro-targeted programs across the federal bureaucracy and throughout different parts of the country, each of which might do something positive but none of which trust anything could happen without creating a new governmental carrot or stick to make that very specific thing happen.
[Note to Ric/Editor: I know that previous sentence is ridiculously run-on, but it’s my attempt at having the sentence style match the content point, if that makes sense?]
Policies like new incentive grants to rehab outdated affordable housing. Help for rural counties to build multi-family units. Promotion of R&D in modular housing. Finalization of rules about “income averages.” The eyes glaze over. I hope that all did something positive? I don’t know.
The Harris announcement in August 2024 is much better.
It starts with the correct big idea, which puts “building more homes at the center of their economic agenda because rents are lower and homes are more affordable when we build more housing.”
Yes.
Compared to 2022, the Harris campaign proposes a far more markets-based solution to building millions more housing units. Their new message is a classic YIMBY agenda: lower the costs and time to build by dropping zoning, permitting, and review processes. If you increase the supply of the thing (Yes! Wow! Amazing!) prices stay low. Also, how to do this?
Specifically, her campaign proposes to incentivize regional and local authorities to lower many of the barriers to building. Exempt projects from very slow environmental review. Change HUD codes to expand the types of houses that can be built. Streamline permitting to speed up construction. Accelerate historical preservation processes that often trip up rehabilitation of properties.
Each of these is thematically linked to pro-growth YIMBYism and just actually better than the 2022 ideas. It’s about getting the regulatory state out of the way to allow the construction sector to do its thing, faster and cheaper.
Housing policy wonks have responded very positively to the Harris proposal, and are somewhat shocked that it has become a key plank of her campaign.
Trump, by contrast, is no YIMBY. He has made “protecting suburbs from apartment buildings” a talking point of his campaign, which is a classic NIMBY move. Trump is on the wrong side of this, choosing to use fear-based language aimed at suburban voters. The way you “protect suburbs from apartment buildings” is you impose NIMBY regulations.
Directionally, the GOP has been committed to the idea that the government is best when it does the least, which should have a YIMBY flavor to it when applied to local zoning and permitting rules around new construction and property rehabilitation. So you might have expected the Trump campaign to be better on this than the Harris campaign. But it’s not.
To be clear, I don’t endorse the view that local government regulation has to be minimized in all or even most situations. I’m just saying that in the case of housing we have a notion about what smaller-government GOP plans ought to be, or could be. It’s what has been going on in GOP-led Texas. The Texas model – pro-growth, pro-development, light regulatory-touch, light zoning – gives us a hint of what could be.
But as far as I can tell, Trump has no “build baby build!” plans when it comes to housing in America, just a nod at NIMBYism.
Harris’ centering of this pro-growth housing approach has the potential to signal to Democratic-led areas – like California, New York, and my hometown in Massachusetts – a better way.
It’s not like we have lost the knowledge or willingness to build housing. It’s just that we have allowed a NIMBY set of policies to get in the way of lower-cost housing and therefore national economic well-being.
A version of this ran in the San Antonio Express News and Houston Chronicle
Please see related posts:
The 2024 Presidential Candidates’ worst economic ideas
Post read (8) times.
