Abundance by Ezra Klein and Derek Thompson

This is the way

I have read many books about current affairs, but have never anticipated one for as long as I did here. Ezra Klein and Derek Thompson have written a tour de force arguing for a change in the culture and values of the Democratic Party at all levels of government. I have been a reader of both of theirs for years and when I found out they were working on a book together I knew I would be reading it. The nearly two year wait was worth it.

Before proceeding, just to let readers know this is not really a book review. I will discuss Abundance plenty, but it’s more like a hybrid of my thoughts on it and on its substantive and electoral implications. If you’ve heard about Abundance and are thinking about ordering it, you can do so here. It’s only around 220 pages and is an easy read. I managed to get through it in just four sittings, which is by far a record.

Klein and Thompson have been writing for some time about the need for a change in how those who are left-of-center think about economic issues. For decades, the focus Democrats have had was on subsidizing demand. The emphasis has been on making it easier for people to obtain things that already exist. For example, the Affordable Care Act makes it easier to gain health insurance. Subsidizing demand is not wrong, but it has limits.

Demand is a big part of what drives the economy, but supply is just as important. Klein and Thompson lament that the phrase supply-side economics is associated with cutting taxes for the highest earners. In fact, that’s just a microscopic fraction of what supply-side economics can mean. Klein coined the phrase supply-side progressivism back in 2021 and Thompson coined the phrase abundance agenda in 2022. Both were aiming at the same thing.

I have cited both of them many times in my writings and they have had a big influence on my thinking over the last few years. In writing Abundance, their target audience is people on the center-left. I’m sure they would be happy for anyone to read it, but the people they hope to most influence are those on the center-left, particularly those who live in blue states with serious governance problems. Regardless of where they live, Abundance is a must-read for any elected Democrat at any level of government and for anyone on their staff.

The change in culture and values requires Democrats to confront the fact that many of the states where they are in charge have failed miserably on some key issues. The biggest failure is in housing, but it’s not random and it didn’t happen overnight. It’s part of what Klein and Thompson call a shift in what liberalism (meaning left-of-center politics) emphasizes.

From the New Deal through the 1960s, the emphasis was on building things. The New Deal oversaw the building of all kinds of infrastructure. In the 1950s, the interstate highway system was built. Cities in places like California grew at a rapid pace because they built lots of housing.

All that had benefits, but it had costs as well. Neighborhoods, usually in poor areas, were paved over and pollution was very bad. Beginning in the late 1960s, but really taking off in the 1970s, the relationship liberals had to the government changed. Rather than be active, liberals wanted to slow the government down. That was true at the federal, state and local levels.

It was during the 1970s when so much of the red tape that’s hobbling the needed building of things today came into effect. Zoning laws were passed in places like California to slow down rapid changes. Environmental review laws were passed to slow down building of all sorts.

Often times, new laws were passed in response to legitimate issues and were well-intentioned. But just as often they were passed with malicious aims. For decades, people had flocked to California because it was an amazing place with great weather, great job opportunities and it was affordable to live there. Believe it or not, housing costs were no higher in California than they were nationally. That ended beginning in the 1970s.

It was during that time when people who had recently moved there and others who had lived there for a long time decided they had it good and didn’t want anyone else to enjoy it. It was once possible to afford a place to live in LA or San Francisco if you were a plumber, teacher or a mechanic, but NIMBYism killed it. It took a long time to materialize, but the effects of zoning laws in California have been wildly successful in their aim of keeping people out.

It was also during the 1970s when anti-growth movements began to gain influence. Zoning laws were sometimes passed with the stated goal of slowing down population growth. Those efforts, too, have been successful with severe consequences.

Klein and Thompson discuss the many problems with expensive housing, including people fleeing California for cheaper states. A major problem that rightfully gets lots of attention is homelessness. It’s no accident that California has the worst homelessness in the country by far (12% of the population, 30% of the homeless population). The more expensive housing is, the worse homelessness is going to be. There are no other factors that explain homelessness as well as housing costs.

It's mentioned early on in Abundance why it focuses on problems with Democrats. The most immediate problem, which both authors have acknowledged in other writings, is Trump and his lawlessness. Opposing him is necessary, but not sufficient. As bad as Trump is, he is not at fault for the failings of blue states nor did he create the federal red tape that makes building needed energy infrastructure and other things so hard.

Democrats have to confront their own failings and pathologies. One implication of following Abundance’s advice is that they will need to have a lot of internal battles, many of which will be ugly. Klein and Thompson are both mild mannered and are not going to breathe fire or skewer those in the Democrats’ coalition. That’s okay, not everyone needs to do that, but others will need to.

Abundance looks at a few big areas where more supply is needed, but the current Democratic Party mindset is standing in the way. Those areas are housing, energy and transportation. The transportation example they use is California’s botched attempt at building high speed rail, which I wrote about recently. Reading that part will make you want to jump out a window.

A problem with the prevailing mindset among Democratic elected officials is their addiction to process. Klein and Thompson say that needs to change. Democrats should care about results, not about how many procedures were followed and not about how much money was spent. If you go by process and money spent, HSR in California is a big success. If you go by results, it’s a miserable failure.

Spending money on things can be necessary, but is not always sufficient. Billions of dollars can be allocated towards something and wind up producing almost nothing because of endless processes. Abundance cites the money given to build EV charging stations in the 2021 infrastructure bill as an example. More than three years later, almost no charging stations have been built. It also mentions the billions allocated to expand broadband access in the same bill. As of today, no new broadband has been built. I don’t care how well processes were followed, that cannot be considered acceptable.

There is a discussion of an affordable housing project in San Francisco, which was built relatively quickly and cheaply. The way that happened is it relied exclusively on private money. The public money that goes towards affordable housing, ironically, comes with so many strings attached that it makes building housing unaffordable. What winds up happening is developers don’t take the money, nothing gets built and housing costs remain sky high.

It's a problem Klein has called everything bagel liberalism. By requiring developers to pursue every single goal under the sun, building housing (or anything) becomes so time consuming and expensive that it doesn’t get built at all. If Democrats at all levels of government are going to take governing seriously, they will have to stop doing that, which will require upsetting many of their supporters.

Following Abundance’s advice will have some big consequences

What is going to be a challenge for many Democrats at all levels of government is they will need to embrace deregulation in some areas. Abundance never uses that word, but the upshot of what it advocates for is clear. In areas like housing, energy and medicine, a substantial number of laws will need to be loosened or repealed altogether. That’s not something many Democrats are accustomed to pushing for, but they will need to do it.

Part of what will be necessary to get the change in culture and values Abundance seeks is to get over some long time dislikes some Democrats have. There is a widespread belief, for example, that small business is inherently better than big business. You can see that in requirements stating that projects funded by the government must hire small business contractors or give them priority in hiring.

There is nothing wrong with small businesses, but, as Klein and Thompson point out, they aren’t always available. Prohibiting big or midsize businesses from doing the job can mean delays, which cost time and money. If there is a dire need to build X number of housing units in an area and the builder who can do it best is Giant Corporation that should be perfectly fine.

If small businesses are the ones who can build things best, they should get the contracts. If it’s big or midsize businesses, then they should get the contracts. This is part of what prioritizing results over process entails. It shouldn’t matter who builds things as long they are built in a timely and cost-effective manner.

Just think about how a normal, non-politically engaged person would see it. Someone who is eager to live somewhere, but can’t afford to rent or own a place would like for housing to be built so they can live there. If you told them, “Sorry, we can’t build enough housing for you to afford to live here, but we followed the process to a tee,” do you think they would be impressed with that? If you told them, “The good news is we built enough housing so you can afford to live here, the bad news is it was built by a big corporation with an all-white, all-male, non-unionized, non-locally hired workforce using parts made overseas,” do you think they would care in the slightest?

Klein and Thompson skate around this issue, but one implication of what they’re advocating for is Democrats are going to have to stop being automatically deferential to unions. There is nothing wrong with using union labor, but, as with small businesses, giving it priority or requiring it to be used causes delays and costs money. The question Democrats will have to answer is whether they care more about building things or pleasing unions.

Unions can be allies in making it easier to build things, but often are not. In California, construction unions routinely use threats of litigation and other means of delaying projects to make builders hire their members. In the case of the privately funded affordable housing project cited in Abundance, the housing itself was largely assembled in a factory that is unionized, but local construction unions still were mad about it. Why? Because it didn’t hire their members. That can’t be acceptable if you care about building things.

I wrote at the end of last year about what I think Democrats should do differently and breaking their unconditional love for unions was one of them. Reading Abundance has only validated that. It won’t be a pretty fight, but it needs to happen. I don’t have any issue with organizing workers, in fact I’m all for it, but unions should not get to determine what is allowed to be built. If they wish to organize workers building housing that’s great, but they can’t be allowed to stop building from happening because their members aren’t the ones doing it.

An obvious implication of what the authors are seeking is that building has to be given priority over all other concerns. I agree with that wholeheartedly, but getting there won’t happen without a fight. Democrats not only have to get over their obsession with process, but they also have to be less agreeable. They have to be willing to say no to their supporters no matter how uncomfortable it is.

In the same post, I wrote that the other group Democrats at all levels of government need to approach differently is environmentalists. More than unions or any other Democratic Party-aligned group, they are the most problematic coalition member. Not only do they push for ideas that are substantively and electorally terrible, but they don’t share the goals of Abundance. Klein and Thompson don’t say it, and maybe don’t believe it or don’t realize it, but there is no way their vision will ever come to pass if that crowd is not kicked to the curb.

Klein and Thompson want the top priority on energy to be building as much clean energy infrastructure as possible. That includes transmission lines, wind and solar farms and nuclear plants as well as deploying all kinds of new technologies like green cement and carbon removal. I certainly agree with that, but while there may be a few exceptions, the overwhelming majority of environmental groups disagree. They prefer to combine apocalyptic, doomerist rhetoric with opposition to doing anything of substance.

What the most vocal environmental groups and advocates want is to prevent fossil fuels from being produced. Examples of that include blocking the Keystone XL pipeline and the effort to block LNG export terminals. That is their overarching goal. They are opposed to doing anything that could make producing fossil fuels easier. If that means opposing permitting reform and making clean energy collateral damage, which it does, that is okay with them.

Those groups have to be seen and called out for the bad faith actors they are. They don’t really care about climate change and don’t believe it’s a problem worth addressing. Many of them say they love renewables, but will turn right around and oppose wind and solar farms if it involves tearing up a single piece of grass. Many of those groups are also opposed to allowing more housing to be built.

A terrible idea that gained traction back in the 1970s is degrowth. It’s the notion that growth is environmentally destructive and must be reduced. In practice, it means NIMBYism on every front. Klein and Thompson explicitly reject degrowth, but many environmental groups still believe in it. Democrats have to recognize that many of those groups are not just insincere in their commitment to caring about climate change, they are bad people who don’t mean well.

Supporting permitting reform is the best way to make clean energy of all types happen. Pursuing it will require compromising with Republicans. Abundance’s target audience is not Republicans, but they will have to be reached out to as that is the only way it will get through Congress. Finding common ground with them will likely mean giving them things like more oil and gas drilling in return for making it easier to build transmission lines.

That trade is a no-brainer in my book, but environmental groups will cry bloody murder over it. If Democrats continue to prioritize not angering them, you can forget about permitting reform happening. Without permitting reform, you can forget about renewables reaching their potential, geothermal taking off and smaller nuclear reactors going anywhere.

A Democratic Party whose candidates and elected officials follow Abundance’s advice will be a much improved one. But the path to getting there will be fraught. It’s going to involve big, internal fights that not everyone is eager to have. Klein and Thompson acknowledge that likelihood even if it’s not their preferred route.

Electoral effects

Of course, I’m a junkie for election-related stuff so I have to write about it. I favor pursuing abundance, but, if I had to quantify it, 80-90% of it is because I think it’s good policy. Only a small fraction is related to electoral considerations.

On the state level, the reason Democrats should pursue abundance is so they can prove the states they run are great places. The problem Democrats have in blue states is not that they don’t get elected. They are called blue states because, by definition, Democrats have no trouble winning there.

As Klein and Thompson note, California should be a model for the nation. It has the fifth largest economy in the world, is the site of Silicon Valley and Hollywood and has amazing weather. Millions of people would like to live there. It’s inexcusable for a place like that to be losing people.

There are many parts of the country that are losing people and are not places people want to live. Most of those places are not at fault for that, but are just out of luck. California doesn’t have that excuse. The wounds there are 100% self-inflicted, but they can all be fixed.

A California that makes it as easy to build housing as Texas does is one people will flock to. It’s a place where housing is affordable, jobs are plentiful and leaders there can credibly say they know how to govern. California has many great things going for it despite horrible housing laws, but nobody can say with a straight face that it’s a place every state should aspire to be.

The same goes for New York City, Maryland, Massachusetts and DC. Those are all solidly blue places where people want to live. The reason they can’t do that is because of NIMBYs. All of those places have the potential to be models for the nation but are choosing to be the opposite. If they choose to crush the NIMBYs, housing will be affordable, millions will flock there and their economies will boom. That’s not a prediction, it’s a guarantee.

One national electoral problem caused by the NIMBYism in blue states is that they lose representation in the House and electoral college. Red and purple states are the ones who gain them. That can make the odds of Democrats winning the presidency a little bit harder each decade.

Many people have been writing about that lately, including Klein and Thompson, but I’m going to throw some cold water on it. I’m not saying it won’t have any effect, it will. We just don’t know what that will be. The soonest any impact would be known is 2032, the first presidential election year after the 2030 census. We have no idea what will be going on. Anyone who is confident of what things are going to be like then is talking out of their ass.

With that said, blue states, get your shit together and smash the NIMBYs. Electoral considerations aside, it’s a disgrace that so many great places are telling people to stay out. Few things piss me off more than listening to a politician from a blue state decry bad things happening in red states. You don’t think people should live in states that ban abortion and treat transgender people poorly? Then allow more housing to be built in your state so more people can live there. If you’re not going to do that, then STFU.

Among the many infuriating things about Democrats catering to NIMBYs is how backward looking it is. Those who are the most opposed to building housing are disproportionately old and retired. Seriously, look at the demographics of those who fight housing tooth-and-nail. It’s almost the same as a retirement home. By allowing them to dictate things, blue states are killing their present and future to serve those 75 and older.

In taking Abundance’s advice, Democrats, particularly on the state and local level, will not just be saying no to the left. They will be saying no to normal, run-of-the-mill Democrats who are not ideologically opposed to housing, but just want their neighborhoods to never change. Saying no to them is going to be a much bigger challenge than saying no to loudmouth protesters and online trolls. It won’t be fun, but it will be necessary if blue states want to grow and stop losing people.

As far as winning Congress and the presidency goes, advocating for abundance could be effective although it may not matter a lot. What abundance offers is a positive vision, which is something Democrats will need come 2028. Just as important, it offers a vision that is reflective of the world we live in. Big spending measures are going to be harder to do because of the country’s fiscal situation. Pursuing abundance, especially deregulation in some areas, is much better suited to austere times.

In addition, abundance is reflective of the economy as it is now. The big problem we have is not having enough of the things we want and need. Spending money can help with that, but it’s not going to get rid of the red tape that is making it so hard to build. Abundance also offers a way to lower prices, which is something fiscal policy is very limited in what it can do.

At a minimum, I don’t think campaigning on abundance will be bad. If the so-called abundance agenda, as first articulated by Thompson, was enacted in its entirety, it would make the country a much better place. That is what counts the most, but I’m skeptical it would make a big difference electorally. In general, legislating very rarely leads to electoral rewards. That’s because most voters are tuned out and once legislation becomes entrenched and creates beneficiaries it usually stops being an issue. That’s frustrating, but it’s always been like that. What matters the most is improving peoples’ lives and abundance succeeds at that in its own right and is much better than any alternative path Democrats could take.