he collapse of the cap-and-trade bill in the Senate this summer constituted the biggest legislative failure of the Obama administration’s first two years in office. While the White House and congressional leaders have racked up some big legislative victories, including health care reform, the stakes with the climate bill were arguably greater. Had the measure passed, not only would it have helped stave off the world’s foremost environmental threat, global warming, but, by encouraging industries to invest in clean energy, it could also have generated millions of jobs in an economy starved for them.
The New Yorker’s Ryan Lizza recently detailed the many reasons for the bill’s demise: opposition from coal-state Democrats, tactical mistakes by the White House, and, most of all, the unwillingness of virtually every GOP senator to support the bill—including those like John McCain who had previously favored cap-and-trade but were under attack by Tea Partiers and Fox News.
But I think Lizza missed a more fundamental reason why the legislation failed: the typical voter just couldn’t relate to it. The harms it was meant to prevent (rising sea levels and spreading droughts over the course of the next century) seemed remote, even speculative to many people, and hence easy for opponents to sow doubts about. So, too, the promised benefits: jobs in nascent or yet-to-be-created green industries. And the mechanism by which these ends would be accomplished (giving polluting companies tradable carbon-emitting permits based on an overall limit on carbon output) were hard for the average person to fathom, much less get excited about. It was a bill only wonks could love, and even many of them preferred a simple carbon tax to a complex carbon-trading scheme.
But what if we could make a major dent in our carbon output while reviving the economy in a way that ordinary Americans could not only understand but also personally benefit from? In their cover story in this issue, Patrick Doherty and Christopher Leinberger make such a case. They argue that we can create ecologically and economically sustainable growth by tapping the public’s abiding love of real estate.
The real estate market is moribund now, say the authors, because developers overbuilt on the suburban fringe—a result of years of government subsidies for new highways and other infrastructure. But a vast wave of new demand for housing is coming, thanks to an epic demographic convergence. Baby boomers, the biggest demographic bloc in the country, are looking to downsize as their nests empty and retirement looms, while their children, the similarly numerous millennial generation, will soon want to purchase their first homes.
Neither group is much interested in living in low-density, auto-dependent suburbs on the metropolitan fringe. Instead, they’re drawn to denser, lively neighborhoods in cities or closer-in suburbs where it’s possible to walk to stores, restaurants, and other amenities—think D.C.’s Dupont Circle area, or suburban town centers like Clayton, Missouri, outside St. Louis. Home prices in such places have soared in recent years and stayed relatively high even during the downturn. That’s a measure of growing demand, but also limited supply: such neighborhoods tend to grow around subway and light rail stations, and most American metro areas don’t have much in the way of mass transit. If Washington would shift federal transportation dollars from highways to mass transit and make a few other changes, it could spark a boom in walkable real estate development, which would mean millions of new construction and other jobs.
And despite mass transit’s rap as a big-government lover’s dream, this transformation could largely be driven by the private sector. A century ago, almost all American cities boasted extensive streetcar systems—owned and run not by government, but by private partnerships between real estate developers and utility companies. With a little encouragement from Washington, similar deals could be struck today.
This private-sector/real-estate-based strategy would go a long way toward achieving key environmental goals. One study found that if all new construction were built in a walkable, transit-friendly fashion it would yield more than half the amount of carbon emission reductions over the next decade than would have occurred in a cap-and-trade system. And while cap-and-trade legislation almost certainly won’t be revived in the next Congress, a clean-energy strategy based on real estate could get a hearing if, as expected, lawmakers next year try to reauthorize the government’s main transportation law. Though Republicans may yet resist the plan, average voters could become firm and passionate supporters. Because this time, instead of appealing to a set of abstractions, we’ll be offering them something they know they want.