The horrible housing blunder – The West s biggest economic policy mistake | Leaders | The Economist
At the root of that failure is a lack of building, especially near the thriving cities in which jobs are plentiful. From Sydney to Sydenham, fiddly regulations protect an elite of existing homeowners and prevent developers from building the skyscrapers and flats that the modern economy demands. The resulting high rents and house prices make it hard for workers to move to where the most productive jobs are, and have slowed growth. Overall housing costs in America absorb 11% of GDP, up from 8% in the 1970s. If just three big cities New York, San Francisco and San Jose relaxed planning rules, America s GDP could be 4% higher. That is an enormous prize.
I’m all for relaxing regulation, except where it reduces my property value of course. But home ownership is also a bulwark of a property based society. Ideally, families will want to buy a house and invest in it. A “fresh architecture” might mean 100 story tenements in which the wage slaves live, like the opening shots of Ready Player One.