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Transcript

Can Kamala cure the housing crisis? · Politix

• 0:00
  SPEAKER_01: I think about it all the time now about artificial intelligence and like the AI
• 0:04
  SPEAKER_01: training and that you have these like democratic politicians whose like software is
• 0:09
  SPEAKER_01: trained on the like toxic,
• 0:12
  SPEAKER_01: dysfunctional,
• 0:13
  SPEAKER_01: degrowth politics of blue states.
• 0:17
  SPEAKER_01: And then they come out and they're like,
• 0:18
  SPEAKER_01: oh,
• 0:18
  SPEAKER_01: if I talk about housing supply and economic growth,
• 0:21
  SPEAKER_01: like that's going to be really tough.
• 0:22
  SPEAKER_01: But if I talk about like my plan for a national program of price controls, that's going to be great.
• 0:27
  SPEAKER_01: That's just like common sense populism.
• 0:30
  SPEAKER_01: Thank you.
• 0:34
  SPEAKER_01: Hi, everyone.
• 0:35
  SPEAKER_01: You are listening to a free preview of the Politics Podcast.
• 0:38
  SPEAKER_01: I'm Matthew Iglesias.
• 0:40
  SPEAKER_01: Brian Boitler, who normally co-hosts with me and does these intros, is on vacation.
• 0:45
  SPEAKER_01: So my guest today will be Jerusalem Dempsis.
• 0:47
  SPEAKER_01: We have a great conversation about housing and the 2024 campaign and housing in the 2024 campaign.
• 0:54
  SPEAKER_01: So it's going to be a lot to learn from and a great conversation.
• 1:04
  SPEAKER_01: Hi, everybody.
• 1:05
  SPEAKER_01: Welcome to the Politics Podcast.
• 1:07
  SPEAKER_01: I'm Matthew Iglesias.
• 1:08
  SPEAKER_01: Brian Boitler is on vacation.
• 1:10
  SPEAKER_01: So my guest today is Jerusalem Dempsis.
• 1:13
  SPEAKER_01: We used to do The Weeds together.
• 1:16
  SPEAKER_01: She's great and has a book that is out today called On the Housing Crisis,
• 1:23
  SPEAKER_01: which is about the housing crisis.
• 1:25
  SPEAKER_01: It's a
• 1:27
  SPEAKER_01: It's a very transparent title.
• 1:29
  SPEAKER_01: So welcome to the show.
• 1:30
  SPEAKER_01: Yeah, thanks for having me, Matt.
• 1:33
  SPEAKER_00: We're running it back.
• 1:34
  SPEAKER_01: Yeah, I mean, we are.
• 1:35
  SPEAKER_01: We are.
• 1:37
  SPEAKER_01: I was on your podcast recently.
• 1:39
  SPEAKER_01: We used to do a podcast together.
• 1:40
  SPEAKER_01: Old podcast friends.
• 1:45
  SPEAKER_01: I really wanted to talk to you because,
• 1:46
  SPEAKER_01: you know,
• 1:47
  SPEAKER_01: we're both like longtime kind of housing policy enthusiasts.
• 1:53
  SPEAKER_01: But this has come up in the presidential campaign in a way that it really hasn't
• 1:59
  SPEAKER_01: been kind of central to politics ever before,
• 2:03
  SPEAKER_01: which I think is interesting and maybe a little bit surprising.
• 2:09
  SPEAKER_01: But I don't know.
• 2:09
  SPEAKER_01: I mean, what do you...
• 2:11
  SPEAKER_01: Why do you think we're seeing politicians talk about housing more than in the past?
• 2:17
  SPEAKER_00: Yeah, I mean...
• 2:18
  SPEAKER_00: Firstly, I do think it's surprising.
• 2:20
  SPEAKER_00: I think that what we're seeing, the explicit conversation around there's a housing shortage.
• 2:26
  SPEAKER_00: And in order to address that shortage, you have to build more homes.
• 2:29
  SPEAKER_00: It's something that you probably have heard a lot.
• 2:31
  SPEAKER_00: I mean,
• 2:31
  SPEAKER_00: I know you,
• 2:32
  SPEAKER_00: Matt,
• 2:32
  SPEAKER_00: have heard,
• 2:32
  SPEAKER_00: but you,
• 2:33
  SPEAKER_00: listener,
• 2:33
  SPEAKER_00: have probably heard this from maybe when you're reading the New York Times or Vox
• 2:40
  SPEAKER_00: or Slow Boring.
• 2:42
  SPEAKER_00: But it's not something that prominent Democratic Party officials will say in stump speeches.
• 2:48
  SPEAKER_00: President,
• 2:49
  SPEAKER_00: former President Barack Obama and Democratic nominee Kamala Harris saying this
• 2:53
  SPEAKER_00: prominently in their,
• 2:55
  SPEAKER_00: you know,
• 2:56
  SPEAKER_00: speeches at the Democratic National Convention.
• 2:58
  SPEAKER_00: And so that is like a big shift from how this issue is usually talked about,
• 3:02
  SPEAKER_00: which with Democrats,
• 3:03
  SPEAKER_00: it's usually talked about as,
• 3:05
  SPEAKER_00: you know,
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  SPEAKER_00: a demand side thing or we need more affordable housing or there's,
• 3:08
  SPEAKER_00: you know,
• 3:09
  SPEAKER_00: you know, other sorts of framings that are much more common.
• 3:13
  SPEAKER_00: And I think,
• 3:14
  SPEAKER_00: I mean,
• 3:14
  SPEAKER_00: largely it's just that the home price appreciation during COVID was just so quick
• 3:20
  SPEAKER_00: and so widespread across the whole country.
• 3:22
  SPEAKER_00: that it just accelerated a need for policymakers to like weigh in on this topic.
• 3:27
  SPEAKER_00: So,
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  SPEAKER_00: I mean,
• 3:28
  SPEAKER_00: before 2020,
• 3:28
  SPEAKER_00: 2021,
• 3:29
  SPEAKER_00: I remember I was talking to a friend of mine who's written about housing for years
• 3:32
  SPEAKER_00: and years,
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  SPEAKER_00: neither of us on this podcast,
• 3:34
  SPEAKER_00: but someone else.
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  SPEAKER_00: And they told me that like,
• 3:37
  SPEAKER_00: you know,
• 3:37
  SPEAKER_00: their story,
• 3:38
  SPEAKER_00: the traffic to their stories once COVID happened was just like,
• 3:41
  SPEAKER_00: astronomical changes were occurring and how readers and regular people were
• 3:45
  SPEAKER_00: interested in reading about the housing crisis and learning about it.
• 3:48
  SPEAKER_00: And so like that is something I also saw reflected in,
• 3:51
  SPEAKER_00: I don't know,
• 3:51
  SPEAKER_00: in,
• 3:51
  SPEAKER_00: I don't know if you saw this too,
• 3:52
  SPEAKER_00: but like in elected officials.
• 3:53
  SPEAKER_00: So when I talked to elected officials,
• 3:55
  SPEAKER_00: like people who were not from high cost of living states were also just all of a
• 3:58
  SPEAKER_00: sudden very interested in what's going on with housing.
• 4:01
  SPEAKER_00: Why is it so expensive?
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  SPEAKER_00: What can we do?
• 4:03
  SPEAKER_00: And you know,
• 4:05
  SPEAKER_00: The vast majority of people who work on this issue are in agreement that there is a shortage of housing.
• 4:09
  SPEAKER_00: And so given that everyone cares about it now,
• 4:12
  SPEAKER_00: now you have people at the top levels of the Democratic Party talking about it.
• 4:17
  SPEAKER_01: I mean, I'm a little bit jealous as a kind of –
• 4:19
  SPEAKER_01: Not jealous,
• 4:20
  SPEAKER_01: but I have this kind of housing hipster haterade about it because I was writing
• 4:28
  SPEAKER_01: about this issue in 2011,
• 4:31
  SPEAKER_01: 2012,
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  SPEAKER_01: when home prices nationally were quite quiescent in the wake of the housing bust.
• 4:40
  SPEAKER_01: And the argument that I was making back then, which was,
• 4:44
  SPEAKER_01: built on arguments from Ed Glazer and Joseph Giorgo was that,
• 4:51
  SPEAKER_01: you know,
• 4:52
  SPEAKER_01: land use regulations in the most in-demand areas were pushing prices up unreasonably,
• 4:59
  SPEAKER_01: and that this had like big systemic negative economic impacts.
• 5:04
  SPEAKER_01: And David Schleicher is at Yale Law now, but
• 5:08
  SPEAKER_01: lived in DC at that time,
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  SPEAKER_01: he really helped me kind of understand this in a more sophisticated way,
• 5:14
  SPEAKER_01: what the policy origins of this were.
• 5:18
  SPEAKER_01: And, you know, so I'd write about this, blah, blah, blah, blah, blah, blah.
• 5:21
  SPEAKER_01: Since COVID, it's like house prices everywhere just kind of went vertical.
• 5:27
  SPEAKER_01: And so now you have almost this like, I don't want to say like backlash to the
• 5:33
  SPEAKER_01: yimby view,
• 5:34
  SPEAKER_01: but it's like,
• 5:36
  SPEAKER_01: it's true that like,
• 5:38
  SPEAKER_01: you can't explain a national increase in housing prices just by talking about like
• 5:46
  SPEAKER_01: zoning rules in the highest cost cities.
• 5:48
  SPEAKER_01: Like that, that doesn't make sense.
• 5:51
  SPEAKER_01: Um,
• 5:51
  SPEAKER_01: so now we're,
• 5:52
  SPEAKER_01: we're having this other,
• 5:53
  SPEAKER_01: other kind of conversation,
• 5:55
  SPEAKER_01: which,
• 5:56
  SPEAKER_01: you know,
• 5:56
  SPEAKER_01: could conceivably end with,
• 5:59
  SPEAKER_01: um,
• 6:00
  SPEAKER_01: you know,
• 6:01
  SPEAKER_01: just like financial rejiggering to increase single family sprawl in the Sunbelt,
• 6:10
  SPEAKER_01: which would both,
• 6:12
  SPEAKER_01: like that would be better than nobody being able to afford a house anywhere,
• 6:16
  SPEAKER_01: but it's also kind of like not really where I started off with.
• 6:21
  SPEAKER_00: Yeah,
• 6:21
  SPEAKER_00: I mean,
• 6:22
  SPEAKER_00: I think it's interesting because,
• 6:23
  SPEAKER_00: right,
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  SPEAKER_00: because in the short run,
• 6:24
  SPEAKER_00: any increase in prices in housing is going to happen because of...
• 6:29
  SPEAKER_00: I mean, well, largely it's gonna happen because of demand changes, right?
• 6:31
  SPEAKER_00: Like the reason why you saw a massive increase in home prices during the pandemic is
• 6:35
  SPEAKER_00: we now know the demand surge that caused that happened as a result of remote work.
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  SPEAKER_00: People were moving out to the suburbs, they were moving to second tier markets.
• 6:43
  SPEAKER_00: And it doesn't take that many more people looking for a new house to like actually
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  SPEAKER_00: significantly increase the net,
• 6:49
  SPEAKER_00: like number of,
• 6:50
  SPEAKER_00: uh,
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  SPEAKER_00: the price of homes and the cost of rent.
• 6:53
  SPEAKER_00: And so, um, you know, I'm a liberal.
• 6:55
  SPEAKER_00: So like, I don't believe that people should be barred from moving where they want to move.
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  SPEAKER_00: And so to me, I don't think there's like a reasonable response to that.
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  SPEAKER_00: Like, um,
• 7:05
  SPEAKER_00: from a policy perspective.
• 7:06
  SPEAKER_00: And so like, I'm going to return to the supply thing because yeah, I mean, it is definitely true.
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  SPEAKER_00: No matter what you do,
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  SPEAKER_00: unless you have like a way oversupplied market of housing,
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  SPEAKER_00: there will be demand shocks and they will increase prices in the short term.
• 7:18
  SPEAKER_00: And so I think it's like a very weird conversation because then like,
• 7:22
  SPEAKER_00: yes,
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  SPEAKER_00: it is true that obviously people,
• 7:25
  SPEAKER_00: the COVID-19 was not about zoning regulations,
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  SPEAKER_00: but at the same time,
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  SPEAKER_00: if it was easier to build housing in places like San Francisco and in Los Angeles and,
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  SPEAKER_00: you know,
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  SPEAKER_00: and Boston and DC and even second tier cities like Nashville,
• 7:40
  SPEAKER_00: you know,
• 7:41
  SPEAKER_00: then the price increase would not have been as devastating for people.
• 7:44
  SPEAKER_00: So I find it like a little bit disingenuous because I'm like,
• 7:46
  SPEAKER_00: yes,
• 7:47
  SPEAKER_00: you're correct that COVID was not caused by like NIMBYs,
• 7:50
  SPEAKER_00: but also does that help us address the problem?
• 7:52
  SPEAKER_00: Like, I don't know.
• 7:53
  SPEAKER_01: Yeah, no, no, no.
• 7:54
  SPEAKER_01: I mean, I agree.
• 7:55
  SPEAKER_01: It's just, it's like...
• 7:59
  SPEAKER_01: you know,
• 8:00
  SPEAKER_01: Yes, I mean, I think that's correct.
• 8:02
  SPEAKER_01: Like more kind of housing supply is good.
• 8:04
  SPEAKER_01: But I mean,
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  SPEAKER_01: we're ending up in,
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  SPEAKER_01: you know,
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  SPEAKER_01: some different kinds of barriers to supply that,
• 8:10
  SPEAKER_01: you know,
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  SPEAKER_01: to some extent,
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  SPEAKER_01: just like get me out of my comfort zone a little bit in terms of like what's up in Idaho,
• 8:18
  SPEAKER_01: where,
• 8:18
  SPEAKER_01: you know,
• 8:19
  SPEAKER_01: like I'm sure they have zoning there too.
• 8:22
  SPEAKER_01: But it's not 100% the same thing.
• 8:25
  SPEAKER_01: But Obama, I mean, you referenced this, right?
• 8:27
  SPEAKER_01: Obama in his speech said,
• 8:30
  SPEAKER_01: did a very,
• 8:32
  SPEAKER_01: I would say,
• 8:32
  SPEAKER_01: like Yimby,
• 8:33
  SPEAKER_01: like Matt and Jerusalem kind of diagnosis of this explicitly,
• 8:37
  SPEAKER_01: right?
• 8:38
  SPEAKER_01: And he said that we need to look at outdated regulations that make it too hard to build housing.
• 8:46
  SPEAKER_01: And that was, you know, that was like music to my ears because that's what we've been saying forever.
• 8:54
  SPEAKER_01: And it was...
• 8:55
  SPEAKER_01: I mean, that was an interesting intervention, right?
• 8:58
  SPEAKER_01: Because even in a world where,
• 9:00
  SPEAKER_01: okay,
• 9:00
  SPEAKER_01: politicians are talking about housing more because prices went up a lot because of COVID.
• 9:05
  SPEAKER_01: Like, it doesn't follow that you need to address the issue with that kind of
• 9:14
  SPEAKER_01: you know,
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  SPEAKER_01: like technocratic shout out,
• 9:18
  SPEAKER_01: which is,
• 9:18
  SPEAKER_01: I think,
• 9:19
  SPEAKER_01: like not controversial among economists necessarily,
• 9:23
  SPEAKER_01: but doesn't align,
• 9:25
  SPEAKER_01: I think,
• 9:25
  SPEAKER_01: with most people's maybe intuitive understanding of the situation,
• 9:31
  SPEAKER_01: doesn't have a really obvious relationship to partisan politics.
• 9:36
  SPEAKER_01: And if anything, the way he framed it,
• 9:38
  SPEAKER_01: You know, made it sound like he was, I mean, he was just offering a conservative style argument, right?
• 9:44
  SPEAKER_01: He was like, oh, there's too many regulations and it's bad.
• 9:47
  SPEAKER_01: It was a, you know, like an unusual thing to hear at a Democratic conference.
• 9:52
  SPEAKER_01: Yeah,
• 9:53
  SPEAKER_00: I mean it's funny because it definitely is not like coded as a democratic policy
• 9:59
  SPEAKER_00: priority given that the places where we see this problem the most are led by
• 10:03
  SPEAKER_00: Democrats and they clearly are not favorable to this,
• 10:07
  SPEAKER_00: this standpoint but I also think it's funny because like to me it's.
• 10:09
  SPEAKER_00: the way that deregulation can be framed really just depends on like the context in so many ways.
• 10:16
  SPEAKER_00: Like,
• 10:16
  SPEAKER_00: yes,
• 10:17
  SPEAKER_00: deregulation could be conservative,
• 10:18
  SPEAKER_00: but deregulation,
• 10:19
  SPEAKER_00: like,
• 10:19
  SPEAKER_00: I don't know,
• 10:19
  SPEAKER_00: there are bad regulations that progressives hate,
• 10:22
  SPEAKER_00: like progressives hate regulations that say black kids can't go to school with
• 10:26
  SPEAKER_00: white kids.
• 10:26
  SPEAKER_00: That's like, is that a deregulatory conservative agenda?
• 10:28
  SPEAKER_00: I'm not sure.
• 10:30
  SPEAKER_00: But,
• 10:30
  SPEAKER_00: you know,
• 10:31
  SPEAKER_00: I do think that it is funny,
• 10:32
  SPEAKER_00: like the differences between Obama,
• 10:35
  SPEAKER_00: who very clearly,
• 10:35
  SPEAKER_00: I mean,
• 10:36
  SPEAKER_00: when he was in office,
• 10:38
  SPEAKER_00: You know, his council of economic advisors had even put out reports.
• 10:41
  SPEAKER_00: He obviously has been and his administration was like EMB pilled very, very early.
• 10:47
  SPEAKER_00: But,
• 10:47
  SPEAKER_00: you know,
• 10:48
  SPEAKER_00: at the same time,
• 10:48
  SPEAKER_00: you see kind of a contrast with how other Democrats are much more comfortable
• 10:51
  SPEAKER_00: talking about this.
• 10:52
  SPEAKER_00: You can like tell that, like, there's a lot more comfort talking about real page and talking about this.
• 10:59
  SPEAKER_00: going after corporate landlords or bad actors.
• 11:03
  SPEAKER_00: And I think that in some levels, it's just like a response.
• 11:06
  SPEAKER_00: I mean, this is your shtick, right?
• 11:07
  SPEAKER_00: This is popularism, right?
• 11:08
  SPEAKER_00: It's very, very popular to personalize economic phenomena and to
• 11:13
  SPEAKER_00: explain it to people and to say there are bad people out there who are making your
• 11:16
  SPEAKER_00: life worse,
• 11:17
  SPEAKER_00: and we're going to go after them.
• 11:19
  SPEAKER_00: People like hearing that.
• 11:20
  SPEAKER_00: They feel like that's the way it works.
• 11:21
  SPEAKER_00: They feel like someone's getting it over on them.
• 11:23
  SPEAKER_00: They've experienced bad landlords.
• 11:24
  SPEAKER_00: They've experienced markets where they feel like they were priced out of a house
• 11:30
  SPEAKER_00: because of an all-cash offer they couldn't compete with.
• 11:33
  SPEAKER_00: They have a sense that they're bad guys and that they're a good guy and that
• 11:36
  SPEAKER_00: someone needs to help them out.
• 11:37
  SPEAKER_00: And so at some level, it's hard to tell what's going to happen here.
• 11:39
  SPEAKER_00: Like if a Harris administration ever happens, like, is that really going to be the focus?
• 11:46
  SPEAKER_00: Is it going to be like,
• 11:47
  SPEAKER_00: we're going to spend a bunch of time trying to figure out whether there are
• 11:51
  SPEAKER_00: collusive entities in real estate or are they going to do a really well designed
• 11:56
  SPEAKER_00: development tax credit that really helps spur the construction of homes?
• 11:58
  SPEAKER_00: Like it's just one of those things where it's so in the policy details that it
• 12:01
  SPEAKER_00: feels like almost impossible to evaluate from like a campaign standpoint.
• 12:05
  SPEAKER_01: Well, I mean, that's where I,
• 12:07
  SPEAKER_01: Right.
• 12:08
  SPEAKER_01: So Harris, I guess I was going to back it up a little bit beyond that.
• 12:12
  SPEAKER_01: But so it's like Obama offered this like very, I think like Yimby diagnosis, right?
• 12:18
  SPEAKER_01: That like housing problem is due to supply problems and the supply problems are due to bad regulations.
• 12:25
  SPEAKER_01: There's different ways you can frame the regulatory push, like in-
• 12:29
  SPEAKER_01: In Arlington, Virginia, they did a zoning reform recently.
• 12:32
  SPEAKER_01: It's a very liberal area.
• 12:34
  SPEAKER_01: And the pitch for that reform was they gave it maximum lefty framing to get it done.
• 12:43
  SPEAKER_01: So this was all about segregation and blah, blah, blah, blah, blah.
• 12:47
  SPEAKER_01: That wasn't the argument that Obama advanced, though.
• 12:51
  SPEAKER_01: He gave this the sort of like center-right spin, you know, because he's a political mastermind.
• 12:58
  SPEAKER_01: And so he is,
• 12:59
  SPEAKER_01: even though he's talking to Democrats,
• 13:01
  SPEAKER_01: he's trying to do something that in a clip makes him sound reasonable to moderately
• 13:06
  SPEAKER_01: conservative people.
• 13:09
  SPEAKER_01: Harris has, there's like a lot going on in her housing proposals.
• 13:14
  SPEAKER_01: But she does talk about housing supply, right?
• 13:17
  SPEAKER_01: I mean, she says we need 3 million new units, which is a lot.
• 13:23
  SPEAKER_01: And I talked to her team, because I asked him, I was like, what does that mean, right?
• 13:28
  SPEAKER_01: Because America bills, like,
• 13:31
  SPEAKER_01: between one and between one and one and a half million units every year so like
• 13:36
  SPEAKER_01: that that could be intended in like a completely vacuous way right like some houses
• 13:43
  SPEAKER_01: get built all the time but like they confirmed to me that no she means like three
• 13:47
  SPEAKER_01: million units on top of the base yeah yeah um which is that's a lot right i mean
• 13:53
  SPEAKER_01: again if you look at that 1.25 million units um
• 13:58
  SPEAKER_01: per year pace, 3 million above baseline.
• 14:01
  SPEAKER_01: They told me over five years.
• 14:03
  SPEAKER_01: They mean, I don't know, but I guess five's a wrong number.
• 14:07
  SPEAKER_01: Like, I'm not totally sure it's even possible.
• 14:11
  SPEAKER_01: To build that much housing in the short term,
• 14:14
  SPEAKER_01: you can't like,
• 14:16
  SPEAKER_01: you know,
• 14:16
  SPEAKER_01: there's only so many electricians in America and they can't be conjured out of thin air.
• 14:22
  SPEAKER_01: But it's very aggressive and yet does not have a really specific purpose.
• 14:30
  SPEAKER_01: like policy upshot on the supply side, right?
• 14:34
  SPEAKER_00: I mean,
• 14:34
  SPEAKER_00: their specifics is that they want to do a development tax credit to make it easier
• 14:38
  SPEAKER_00: to finance starter homes.
• 14:39
  SPEAKER_00: Like the details are like non-existent right now because I mean,
• 14:41
  SPEAKER_00: it's a campaign,
• 14:42
  SPEAKER_00: but it's like,
• 14:43
  SPEAKER_00: it's like a little bit weird to me because it seems like they're trying to say that
• 14:46
  SPEAKER_00: they want to provide
• 14:48
  SPEAKER_00: tax credits to developers that build homes that are bought by people who are first
• 14:54
  SPEAKER_00: generation homeowners.
• 14:56
  SPEAKER_00: I think I'm getting that right.
• 14:57
  SPEAKER_00: And I mean, that just seems like a very complicated policy design.
• 15:00
  SPEAKER_00: And like what we know about this regulatory space is that complicated policy designs make it
• 15:04
  SPEAKER_00: more difficult to build housing.
• 15:06
  SPEAKER_00: So we'll see.
• 15:07
  SPEAKER_00: But I honestly, to me, I don't know, like, I don't want to be too, I don't want to be down on this.
• 15:10
  SPEAKER_00: I feel like a lot of people are like,
• 15:11
  SPEAKER_00: see,
• 15:11
  SPEAKER_00: hearing this stuff and they're like,
• 15:12
  SPEAKER_00: they sound very down on it.
• 15:13
  SPEAKER_00: I think that like the vast majority,
• 15:15
  SPEAKER_00: what we know about housing is that it is a locally determined question.
• 15:21
  SPEAKER_00: How much is built in an area that like what is literally constraining supply in the
• 15:27
  SPEAKER_00: places where people want to move is that it's like hard to build new homes there.
• 15:30
  SPEAKER_00: And yes,
• 15:31
  SPEAKER_00: like,
• 15:31
  SPEAKER_00: you know,
• 15:32
  SPEAKER_00: the most research has been done in these superstar cities,
• 15:34
  SPEAKER_00: but like,
• 15:34
  SPEAKER_00: you can go look at like Nashville,
• 15:35
  SPEAKER_00: you can see the supply constraints there,
• 15:37
  SPEAKER_00: you can see them in
• 15:39
  SPEAKER_00: Austin, Texas, where the Texas state legislature has been working too.
• 15:41
  SPEAKER_00: And the Austin local city council has been working to remove some of these barriers as well.
• 15:45
  SPEAKER_00: You see these in these major cities all the time because they tend to copy each other's zoning codes.
• 15:49
  SPEAKER_00: And so that's something where you actually need a bunch of,
• 15:54
  SPEAKER_00: I think,
• 15:55
  SPEAKER_00: really ideological change happening at the local level amongst Democrats.
• 15:59
  SPEAKER_00: They need to think that when I'm on team Democrat,
• 16:01
  SPEAKER_00: that means I need to figure out a way to build housing.
• 16:03
  SPEAKER_00: And like,
• 16:04
  SPEAKER_00: even with all these constraints,
• 16:05
  SPEAKER_00: like I just really don't,
• 16:06
  SPEAKER_00: I like fundamentally believe that if every single person on the San Francisco Board
• 16:09
  SPEAKER_00: of Supervisors was like fully growth pilled and like really wanted to build housing,
• 16:13
  SPEAKER_00: it really wouldn't matter what regulations were on the books.
• 16:15
  SPEAKER_00: Like they would figure out a way to get a bunch of new housing permitted like every single year.
• 16:19
  SPEAKER_00: And so that's,
• 16:20
  SPEAKER_00: that's why I think though,
• 16:20
  SPEAKER_00: like the Harris thing,
• 16:21
  SPEAKER_00: it's like,
• 16:21
  SPEAKER_00: the question is like,
• 16:22
  SPEAKER_00: how does this kind of rhetoric actually change the game in terms of how local and
• 16:26
  SPEAKER_00: state elected officials view themselves as Democrats?
• 16:29
  SPEAKER_00: Yeah.
• 16:29
  SPEAKER_01: Well,
• 16:29
  SPEAKER_01: that's what I thought was the interesting difference between the way Obama said it
• 16:34
  SPEAKER_01: and the way Harris said it,
• 16:35
  SPEAKER_01: right?
• 16:35
  SPEAKER_01: Because what Obama said doesn't mean anybody will listen to him,
• 16:42
  SPEAKER_01: but you can take the text of that speech to your city council meeting and use it to
• 16:48
  SPEAKER_01: win an argument,
• 16:50
  SPEAKER_01: right?
• 16:50
  SPEAKER_01: To be like,
• 16:52
  SPEAKER_01: Barack Obama just told us that we need to update outdated rules that stand in the
• 16:58
  SPEAKER_01: way of building more housing units,
• 17:00
  SPEAKER_01: right?
• 17:02
  SPEAKER_01: The way Harris put it, it's like, if you already agree with us about housing,
• 17:09
  SPEAKER_01: what we think you should do follows from what she said.
• 17:11
  SPEAKER_01: Like, we need 3 million more housing units.
• 17:14
  SPEAKER_01: You're like, wow, that's an incredibly ambitious growth target.
• 17:17
  SPEAKER_01: The only way we could possibly get there is with regulatory changes.
• 17:21
  SPEAKER_01: And actually, in particular, like...
• 17:24
  SPEAKER_01: infill regulatory changes because it economizes on building materials, right?
• 17:30
  SPEAKER_01: And these various other things.
• 17:33
  SPEAKER_01: But like the text doesn't say that, right?
• 17:37
  SPEAKER_01: It's like compatible with the idea that
• 17:40
  SPEAKER_01: Right.
• 17:40
  SPEAKER_01: I mean, like classic not in my backyard.
• 17:42
  SPEAKER_01: Right.
• 17:43
  SPEAKER_01: It's like we definitely need three million units.
• 17:46
  SPEAKER_01: Yeah.
• 17:47
  SPEAKER_01: Somewhere.
• 17:48
  SPEAKER_00: But in the Florida suburbs, they need to all go.
• 17:51
  SPEAKER_01: Well, wherever.
• 17:52
  SPEAKER_01: I mean, it's you know, I mean, literally I was over the summer.
• 17:56
  SPEAKER_01: I was in Maine where there has been.
• 18:00
  SPEAKER_01: Maine is the kind of place that you were talking about, right?
• 18:03
  SPEAKER_01: Because of COVID and remote work,
• 18:06
  SPEAKER_01: millions of people who live in the urban Northeast corridor have visited Maine over
• 18:11
  SPEAKER_01: the years,
• 18:12
  SPEAKER_01: and many of them like it.
• 18:14
  SPEAKER_01: My dad is a novelist, so he's always been a remote worker.
• 18:18
  SPEAKER_01: So he had a summer house out there forever and ever and ever.
• 18:22
  SPEAKER_01: A really,
• 18:22
  SPEAKER_01: really,
• 18:23
  SPEAKER_01: really small number of people who live in Northeastern metro areas decided they
• 18:28
  SPEAKER_01: want to go live in Maine permanently as a result of remote work.
• 18:32
  SPEAKER_01: But there's so few people in Maine that a really small influx of population has
• 18:38
  SPEAKER_01: overturned the housing markets there.
• 18:40
  SPEAKER_01: And everything is chaos.
• 18:43
  SPEAKER_01: And nearby to where I was staying,
• 18:46
  SPEAKER_01: there's a plan to build nine homes on small lots on,
• 18:52
  SPEAKER_01: you know,
• 18:53
  SPEAKER_01: what had been a blueberry field.
• 18:55
  SPEAKER_01: And like lots of people are like really fired up about how this needs to be stopped
• 19:01
  SPEAKER_01: because it's going to spoil some nice view.
• 19:04
  SPEAKER_01: And
• 19:08
  SPEAKER_01: You know, you talk to them and you're like, housing crisis.
• 19:12
  SPEAKER_01: Like, come on, guys.
• 19:13
  SPEAKER_01: And it's like very literally like, we should totally build housing.
• 19:18
  SPEAKER_01: And they don't mean like, well, the housing should be in Florida.
• 19:20
  SPEAKER_01: But it's like, maybe there should be more like apartments in Ellsworth.
• 19:25
  SPEAKER_01: Or maybe, you know, it's just like the housing should be someplace else.
• 19:29
  SPEAKER_01: I mean, sure.
• 19:30
  SPEAKER_00: But I think the outcome of the current policy regime is that we are just building the houses in Florida.
• 19:35
  SPEAKER_00: Yeah.
• 19:35
  SPEAKER_00: So it's like,
• 19:36
  SPEAKER_00: you know,
• 19:36
  SPEAKER_00: I get that maybe theoretically they're like,
• 19:38
  SPEAKER_00: we would like them to be downtown in the local like mid-sized city.
• 19:41
  SPEAKER_00: But in general, what they really are saying is, yeah, build them in Texas and Florida.
• 19:46
  SPEAKER_00: Well, exactly.
• 19:46
  SPEAKER_00: Right.
• 19:47
  SPEAKER_01: Yes.
• 19:48
  SPEAKER_01: But that's the difference between like,
• 19:51
  SPEAKER_01: like what's the outcome that people want and what's the process that people uphold.
• 19:57
  SPEAKER_01: Right.
• 19:57
  SPEAKER_01: So you had a piece, this must be too new for the book, right?
• 20:01
  SPEAKER_01: But that it's like,
• 20:04
  SPEAKER_01: If the policy is everyone gets to weigh in on every new development and like raise
• 20:12
  SPEAKER_01: their objections,
• 20:13
  SPEAKER_01: then the outcome is just very little will get built.
• 20:17
  SPEAKER_01: And it'll end up getting built in places where there's less opportunity to kind of fuss around.
• 20:23
  SPEAKER_01: Even if like you...
• 20:26
  SPEAKER_01: Right.
• 20:26
  SPEAKER_01: Like one person actually totally would be fine with housing like three blocks away.
• 20:32
  SPEAKER_01: Right.
• 20:32
  SPEAKER_01: It's just like, that's, that's, that's not a, that's not a rule you can create.
• 20:36
  SPEAKER_00: Yeah.
• 20:36
  SPEAKER_00: I think this is also,
• 20:37
  SPEAKER_00: I mean,
• 20:37
  SPEAKER_00: like a meta point really is like,
• 20:39
  SPEAKER_00: I mean,
• 20:39
  SPEAKER_00: part of this,
• 20:40
  SPEAKER_00: this broader argument about why like pro housing,
• 20:43
  SPEAKER_00: like advocates have been so focused on zoning regulations and superstar cities.
• 20:47
  SPEAKER_00: It's just that like the costs, I mean, you kind of tag this, but like the costs are not just like the,
• 20:53
  SPEAKER_00: on housing, right?
• 20:54
  SPEAKER_00: Like the thing that you're losing when people can't move to like high wage jobs is like,
• 20:59
  SPEAKER_00: well,
• 20:59
  SPEAKER_00: their wages are lower,
• 21:00
  SPEAKER_00: but it also means that they're like less well matched with firms,
• 21:03
  SPEAKER_00: which means that there's less productivity.
• 21:05
  SPEAKER_00: That means if people are not like agglomerating in these places and
• 21:09
  SPEAKER_00: thinking of new ideas,
• 21:10
  SPEAKER_00: making new inventions,
• 21:12
  SPEAKER_00: furthering the human species,
• 21:13
  SPEAKER_00: whether that means creating a better way for me to get cheap earrings on Amazon,
• 21:17
  SPEAKER_00: or it's figuring out AI so that all of us can stop working and spend time with our
• 21:23
  SPEAKER_00: kids and grandparents.
• 21:25
  SPEAKER_00: Whatever it is,
• 21:25
  SPEAKER_00: I think people don't realize that the costs here are much larger than this one thing,
• 21:31
  SPEAKER_00: which is what makes it difficult to have this conversation at the local level with
• 21:34
  SPEAKER_00: the process you're talking about,
• 21:35
  SPEAKER_00: because at the local level,
• 21:36
  SPEAKER_00: someone's like,
• 21:36
  SPEAKER_00: hey,
• 21:37
  SPEAKER_00: do you want this
• 21:39
  SPEAKER_00: nine-unit development to occur where you go with your kids to picnic and play soccer,
• 21:45
  SPEAKER_00: or more likely where you drive by sometimes and remark,
• 21:47
  SPEAKER_00: that's a nice view.
• 21:48
  SPEAKER_00: And then someone's like, no, I mean, I'd rather just like it stays the way it is.
• 21:52
  SPEAKER_00: But if you're like,
• 21:53
  SPEAKER_00: hey,
• 21:53
  SPEAKER_00: would you like a process by which the American economy grows much more slowly,
• 21:59
  SPEAKER_00: that your wages are lower,
• 22:00
  SPEAKER_00: that your kids can't live near you,
• 22:02
  SPEAKER_00: and also that eventually stagnation means that you cannot even capitalize on
• 22:07
  SPEAKER_00: the high cost of your own house.
• 22:08
  SPEAKER_00: Like, I mean like, then you're like, okay, yeah, I definitely don't want that system.
• 22:11
  SPEAKER_00: But like, it's very, very hard to fix that system when like all the levers are at the local level.
• 22:15
  SPEAKER_00: So it's just like, yeah, I mean.
• 22:17
  SPEAKER_01: But you know,
• 22:18
  SPEAKER_01: but I mean,
• 22:18
  SPEAKER_01: I think that's important because this is where even the like Obama thought
• 22:22
  SPEAKER_01: leadership didn't go.
• 22:25
  SPEAKER_01: Right.
• 22:25
  SPEAKER_01: And so it's like part of the argument,
• 22:28
  SPEAKER_01: So like the Boston area has much higher wages than the American average.
• 22:36
  SPEAKER_01: And some of that is because the Boston area has all these like good jobs in the biotech sphere, right?
• 22:43
  SPEAKER_01: And so those companies can't expand as rapidly as they otherwise might if it was cheaper.
• 22:51
  SPEAKER_01: But also most people in the Boston area just work like regular service sector jobs, the same as anybody.
• 22:57
  SPEAKER_01: But you earn more working at Chipotle in Cambridge,
• 23:01
  SPEAKER_01: Massachusetts than in Arlington,
• 23:04
  SPEAKER_01: Texas,
• 23:04
  SPEAKER_01: because your customers are richer.
• 23:07
  SPEAKER_01: But the housing costs more than offset the higher wages right now.
• 23:14
  SPEAKER_01: But if you had a more elastic housing supply,
• 23:17
  SPEAKER_01: more people could be earning the high wages of a daycare worker,
• 23:22
  SPEAKER_01: a burrito roller,
• 23:24
  SPEAKER_01: etc.,
• 23:24
  SPEAKER_01: who does that stuff for the biotech people.
• 23:28
  SPEAKER_02: Mm-hmm.
• 23:30
  SPEAKER_01: Then also local services would be cheaper for everybody, not just housing, but right.
• 23:36
  SPEAKER_00: But daycare.
• 23:37
  SPEAKER_00: Right.
• 23:37
  SPEAKER_01: It would be easier to get your kid into daycare.
• 23:40
  SPEAKER_01: People might have larger families or start families younger.
• 23:45
  SPEAKER_01: They could do more things with their own time.
• 23:48
  SPEAKER_01: They could have nicer yards, you know, and you start to see this like.
• 23:53
  SPEAKER_01: People go eventually I was other place I went on my exciting summer vacation with Southampton.
• 23:59
  SPEAKER_01: And, you know, people in like, you're really living the yuppie wasp lifestyle.
• 24:04
  SPEAKER_00: I'm voyaging.
• 24:09
  SPEAKER_01: You know,
• 24:10
  SPEAKER_01: and people there,
• 24:11
  SPEAKER_01: it's like very funny because it's the most self-interested rich people in the world.
• 24:16
  SPEAKER_01: And they like, of course, do not want desert housing in the Hamptons.
• 24:20
  SPEAKER_01: But like the towns that don't have nice beaches that are nearby are.
• 24:25
  SPEAKER_01: where the gardeners and waiters used to live, like those have become unaffordable.
• 24:31
  SPEAKER_01: And so like now people are upset because they want,
• 24:33
  SPEAKER_01: you know,
• 24:34
  SPEAKER_01: and you get this,
• 24:35
  SPEAKER_01: I don't ski,
• 24:36
  SPEAKER_01: but I've heard from people who do that.
• 24:38
  SPEAKER_01: This is like, this is like the new, like, this is very big in ski towns.
• 24:42
  SPEAKER_01: Yeah.
• 24:43
  SPEAKER_01: Zoning controversy,
• 24:44
  SPEAKER_01: which is,
• 24:44
  SPEAKER_01: you know,
• 24:46
  SPEAKER_01: it's weird to be like,
• 24:47
  SPEAKER_01: well,
• 24:47
  SPEAKER_01: we need like affordable restaurants in ski towns,
• 24:51
  SPEAKER_01: but like,
• 24:52
  SPEAKER_01: you know,
• 24:52
  SPEAKER_01: it's just like,
• 24:53
  SPEAKER_01: it's an example of how there's a systemic,
• 24:56
  SPEAKER_01: um,
• 24:57
  SPEAKER_01: issue when people can't live where there's good opportunities to,
• 25:03
  SPEAKER_01: to do things.
• 25:04
  SPEAKER_01: Right.
• 25:04
  SPEAKER_00: I mean,
• 25:04
  SPEAKER_00: this is why I feel like,
• 25:05
  SPEAKER_00: so like,
• 25:07
  SPEAKER_00: like excited about Harris explicitly tying the shortage to prices.
• 25:11
  SPEAKER_00: Like there's a study from like these three professors, Clayton and all Chris Elmendorf and Stan.
• 25:17
  SPEAKER_00: I'm not, I'm so sorry, Stan.
• 25:21
  SPEAKER_00: Um,
• 25:23
  SPEAKER_00: And,
• 25:23
  SPEAKER_00: you know,
• 25:23
  SPEAKER_00: they're at the University of California,
• 25:26
  SPEAKER_00: and basically their study indicates that people are generally pretty good when you
• 25:30
  SPEAKER_00: ask them what happens if supply is constrained and understanding that means that
• 25:34
  SPEAKER_00: prices will go higher.
• 25:35
  SPEAKER_00: Like, they ask them about this when it comes to, like, cars and other things.
• 25:39
  SPEAKER_00: But then they ask them that about housing,
• 25:41
  SPEAKER_00: and,
• 25:41
  SPEAKER_00: like,
• 25:42
  SPEAKER_00: people have what they call kind of,
• 25:43
  SPEAKER_00: like,
• 25:44
  SPEAKER_00: this kind of,
• 25:44
  SPEAKER_00: like,
• 25:45
  SPEAKER_00: this delusion about housing,
• 25:46
  SPEAKER_00: which is,
• 25:46
  SPEAKER_00: quote,
• 25:47
  SPEAKER_00: contrary to basic economic theory and robust empirical evidence.
• 25:52
  SPEAKER_00: that if new housing were built, that rents and home prices would rise.
• 25:56
  SPEAKER_00: And that's something that like other researchers,
• 25:59
  SPEAKER_00: namely Vicky Bean,
• 26:00
  SPEAKER_00: has referred to as supply skepticism.
• 26:03
  SPEAKER_00: And so, you know, this is something where like it actually is like
• 26:08
  SPEAKER_00: Lib misinformation that needs to be corrected repeatedly such and like it is good
• 26:12
  SPEAKER_00: that it is happening from the highest levels of the Democratic Party from like a
• 26:15
  SPEAKER_00: credible like Speaker who is like,
• 26:18
  SPEAKER_00: you know,
• 26:19
  SPEAKER_00: I love Obama right like I'm a technocrat he's a technocrat he's great he's Lib but
• 26:22
  SPEAKER_00: like Kamala Harris is like very much like this is a classic current mainstream
• 26:27
  SPEAKER_00: Democrat she like has
• 26:29
  SPEAKER_00: Lefty opinions on like racial justice and on class inequality.
• 26:32
  SPEAKER_00: She like has bought into a lot of the,
• 26:35
  SPEAKER_00: you know,
• 26:35
  SPEAKER_00: price gouging framework of like thinking about things that like lawyers love to use.
• 26:40
  SPEAKER_00: And so,
• 26:40
  SPEAKER_00: you know,
• 26:41
  SPEAKER_00: from that person,
• 26:42
  SPEAKER_00: it coming from them that like the supply shortage is causing the higher prices.
• 26:47
  SPEAKER_00: I just think that that's actually really, really impactful.
• 26:49
  SPEAKER_00: And I don't know, like I'm not I'm not going to underrate that.
• 26:52
  SPEAKER_01: Yeah, I mean, that's got to be the hope, right?
• 26:55
  SPEAKER_01: That this is a kind of constructive thought leadership that kind of goes down.
• 27:00
  SPEAKER_01: I just think it's interesting where she's like... She's in a space where I feel like it's...
• 27:06
  SPEAKER_01: it's like a dog whistle to Gimby's.
• 27:10
  SPEAKER_01: But like, I wonder if it's being heard by people who are supply skeptics, right?
• 27:16
  SPEAKER_01: It's like,
• 27:17
  SPEAKER_01: do you hear this as a call for regulatory reform,
• 27:23
  SPEAKER_01: you know,
• 27:24
  SPEAKER_01: or not,
• 27:25
  SPEAKER_01: especially because there's a lot of other things that she's also saying.
• 27:30
  SPEAKER_01: So I'm going to do a break,
• 27:31
  SPEAKER_01: do a paywall here,
• 27:32
  SPEAKER_01: because then I want to talk about some of these other things.