The Price of Constructing Progress – Econlib

• Guide Assessment of: Why Nothing Works: Who Killed Progress–and Tips on how to Deliver It Again by Marc J. Dunkelman,; and

• Abundance by Ezra Klein and Derek Thompson.

Vera Coking and the Price of Progress

In 1961, Vera Coking and her husband bought a house in Atlantic Metropolis, New Jersey. They paid $20,000 for the modest three-story home, or about $215,000 in 2025 {dollars}. Coking was on the lookout for a summertime residence, not an funding. But when she had been seeking to generate income, she would have been exhausting pressed to do higher. Twenty years later, Coking acquired a suggestion of 1 million {dollars} from Bob Guccione of Penthouse who needed the land for a on line casino he was growing. She turned it down. Then, in 1993, one other on line casino developer tried to purchase the land to make use of as a limousine parking zone. As soon as once more, Coking refused the provide.

This time, nonetheless, the developer refused to take “no” for a solution. Since a voluntary trade wasn’t going to work, the developer went to the state as a substitute. Particularly, he turned to the state’s On line casino Redevelopment Company, which sought to make use of the ability of eminent area to kick Coking out of her home in opposition to her will. A brand new parking zone, the developer argued, would higher serve the general public curiosity than an outdated, single-family residence. And if it occurred to serve the developer’s non-public monetary curiosity alongside the way in which, properly, that was only a a type of joyful accidents alongside the street to progress.

Fortunately for Coking, her case attracted the eye of the general public curiosity regulation agency, The Institute for Justice. With their assist, Coking was in a position to safe a modest victory in courtroom. She stored her home, not as a result of the courtroom rejected the precept of eminent area altogether, however as a result of on this explicit case, the state’s plan put “no limits” on what the developer may do with the land, within the phrases of Superior Courtroom Decide Richard Williams. The developer, one Donald J. Trump, must park his clients’ limousines some place else.

Markets, Authorities, and the Limitations to Abundance

I used to be reminded of the Coking case whereas studying two latest books, each of which argue persuasively that America has made it too tough to construct new issues, and that making constructing simpler once more may unleash a brand new wave of prosperity and development. These books, Marc Dunkelman’s Why Nothing Works and Ezra Klein and Derek Thompson’s Abundance, are noteworthy in lots of respects, however not least due to their moderately stunning political orientation. Klein, Thompson, and Dunkelman all establish as progressive liberals, and their books are geared toward convincing the center-left to undertake the sort of pro-growth place that’s extra usually related to the political proper. To a liberalism that has devoted a lot of its energies to arguments about find out how to divide the financial pie extra equitably, Klein, Thompson, and Dunkelman appear to counsel that we focus as a substitute on find out how to make that pie larger for everybody.

That suggestion—which I ought to stress is barely implicit within the two books—echoes some extent that has lengthy been made by conservatives, classical liberals, and libertarians. And, certainly, there may be a lot else in these books for such readers to understand. Because the authors reveal with an enormous vary of particular examples, a giant a part of the explanation why Individuals haven’t constructed as a lot as we may and may have is that authorities has gotten in the way in which. Left to their very own gadgets, free markets are usually wonderful of their capability to find progressive, environment friendly, and scalable methods to supply the issues that folks need. However when authorities guidelines impede markets’ means to construct new housing, we wind up with a disaster of affordability and homelessness. When authorities places up obstacles to the event and advertising of recent prescribed drugs, we wind up ready many years for cures that would have been delivered in years or months. In these and a bunch of different comparable instances, unleashing abundance means reducing again on the scale and scope of presidency and letting the inventive destruction of free markets rip.

Nevertheless, reducing again on authorities regulation of the market, based on the authors, is merely a essential step towards abundance. It’s not a enough one. The issue shouldn’t be merely that authorities has hobbled markets; it’s that authorities has additionally hobbled itself. A wide range of elements, together with the “rights revolution” of the second half of the 20th century and an rising emphasis on inflexible proceduralism, have left authorities crippled in its means to get issues executed. Nevertheless well-intentioned these developments could have been, their impact was to ascertain a bunch of recent “veto gates,” every able to bringing tasks to a grinding halt. And thus we discover ourselves in a state of affairs the place extending subway traces in New York Metropolis takes many years and winds up costing twenty instances as a lot as comparable tasks in different cities world wide, the place the projected prices of a clear power undertaking in Maine virtually doubled seven years after its approval and not using a single mile of line ever being constructed, and the place California has been struggling to even begin a functioning excessive velocity rail line that was first permitted in 1982.

If we need to begin constructing once more, one thing should change. However what, precisely? Financial development is an incredible good, however because the case of Vera Coking reveals, we don’t essentially need financial development at any value. So, what kind of framework do these books provide for understanding the character of our downside, and for distinguishing good development from unhealthy?

The Jeffersonian Entice and Procedural Paralysis

For Dunkelman, a lot of the issue may be traced to the rise of “Jeffersonianism,” a philosophy of governance pushed by a skepticism of enormous, centralized establishments, and which seeks to guard people from overbearing authority by pushing state authority down and out. It’s this Jeffersonian philosophy which supported the creation of an enormous new array of rights over the course of the twentieth century, rights designed to guard people, communities, and the setting in opposition to the oppressive energy of each massive authorities and massive companies alike. Some such protections are essential, Dunkelman concedes, however a central declare of the ebook is that Jeffersonianism has been carried too far, and what’s wanted now could be a corrective swing again towards a extra “Hamiltonian” philosophy of centralized, skilled authority.

Dunkelman’s distinction captures two broad public attitudes towards political authority, however these public attitudes fall properly wanting the coherence we would anticipate from rigorous philosophical techniques. And this limits their utility in understanding—not to mention guiding—political choice making. For instance, Dunkelman recounts how, within the Seventies, progressives and police unions throughout joined forces to restrict the discretionary energy of police chiefs. The objective of the motion was to guard officers from numerous abuses of energy, which sounds Jeffersonian. However by limiting the discretionary energy of police chiefs, the reforms wound up rising the discretion of beat cops, thereby leaving abnormal residents extra weak to the unchecked authority of the police.

The same sample may be discovered in lots of different Jeffersonian reforms. Legal guidelines enacted to guard the pure setting from exploitation by massive companies necessitate the creation of enormous new authorities bureaucracies to outline, adjudicate, and implement these rights. In every case, we are able to describe the change as decentralizing energy in a way. However usually, makes an attempt to abolish energy merely redistribute it, and the framework of Jeffersonianism vs Hamiltonianism doesn’t inform us a lot in regards to the internet energy wielded over people. Nor does it present a helpful information for excited about how energy ought to be distributed as a way to promote both financial development or the opposite values we would want to pursue.

Klein and Thompson provide much less in the way in which of an overarching theoretical framework than does Dunkelman. However one theme that runs clearly all through their ebook is the concept that abundance has been thwarted by an overemphasis on proceduralism. Proceduralism, on this context, means the conviction that governmental legitimacy is to be earned by compliance with an “endless catalog of rules and restraints.” Legal guidelines and rules show their advantage by surviving notice-and-comment periods, environmental opinions, courtroom challenges, and so forth. These procedural constraints are designed to serve two official targets—legitimacy and accountability. However the precise outcome, based on authorized scholar Nicholas Bagley, on whose work Klein and Thompson draw, has been a system that “frustrate[s] the very government action that progressives demand to address the urgent problems that now confront us.”

As a substitute of specializing in procedures, Klein and Thompson argue, we should always focus as a substitute on what really issues to folks—outcomes. Nobody cares what number of reviews have been written within the technique of approving the development of a brand new bridge. What they care about is whether or not the bridge will get constructed, safely, cheaply, and rapidly.

All this seems like frequent sense, aside from one massive downside: governments don’t have any means of instantly choosing outcomes. Governments can create establishments; they’ll create legal guidelines; they’ll create taxes and subsidies. They usually can hope and intend that these creations will in the end generate sure outcomes. However whether or not these outcomes materialize or not is a matter that is determined by an entire host of things, the overwhelming majority of that are outdoors of presidency’s direct management.

Think about an analogy. I’d need my son to develop into a gifted runner. However he received’t make a lot progress towards that objective by merely specializing in the end result. (“To-do today—become a great runner!”) It merely isn’t actionable. A great coach will break the end result down into concrete steps or procedures. Focus in your kind, management your breath, and put within the miles. Belief the method. A great course of doesn’t assure final result. Nevertheless it makes that final result extra doubtless by making clear the steps you must take to get there. The identical is true for presidency. Procedures are a means of focusing the federal government’s consideration on the issues which are below its management, as a way to make the end result which is not below its management extra possible.

Procedures aren’t solely useful, however they’re additionally unavoidable. The one approach to obtain an final result is thru some sort of course of. The one query is whether or not we’re going to obviously and punctiliously outline that course of or go away it as much as probability and the discretion of the events concerned. Ailing thought-out procedures is not going to solely make the specified final result much less doubtless; additionally they create alternatives for the method to be captured and manipulated by teams in search of to advertise their very own particular curiosity on the expense of the frequent good.

Seize, Cronyism, and Authorities Failure

All this results in some of the stunning omissions of the 2 books. For all their give attention to the failures of presidency coverage—both to construct issues itself, or to correctly incentivize and help market actors in doing so—there may be shockingly little dialogue of the sphere of examine which has developed probably the most systematic account of the character and causes of presidency failure: public alternative principle. Apart from Klein’s transient dialogue of Mancur Olson’s traditional, The Rise and Decline of Nations, there may be valuable little dialogue of rent-seeking, company seize, or the underlying structural incentives that generate the numerous pathologies that Dunkelman, Klein, and Thompson observe. And and not using a clear analysis of the issue, the authors wrestle to offer a treatment that’s clear, compelling, and politically lifelike.

Lots of the core findings of public alternative principle have been usefully summarized in Peter Schuck’s 2014 ebook, Why Authorities Fails So Typically: And How It Can Do Higher. Schuck attracts explicit consideration to the issues of knowledge and incentives that bedevil so many authorities undertakings. In short, authorities officers usually lack the detailed, context-specific, and quickly altering information essential to supply socially fascinating outcomes and sometimes are under-incentivized to pursue these outcomes anyway, even when they knew how to take action. Furthermore, these defects aren’t non permanent or simply corrected. They’re, based on Schuck, rooted in an “inescapable, structural condition: officials’ meager tools and limited understanding of the opaque, complex social world that they aim to manipulate.”

Schuck’s considerations particularly apply to Klein and Thompson’s name for a extra expansive authorities function in fostering innovation. Klein and Thompson declare that the favored concept that authorities is “lousy at picking winners” is a delusion that “bears little resemblance to history.” Drawing closely on the work of Mariana Mazzucato, they argue that the American authorities has in actual fact performed an expansive function in growing lots of the applied sciences and conveniences that form our fashionable world. From the iPhone to shale drilling to federally sponsored mortgages, there may be hardly any side of our lives that’s untouched by authorities “picking.”

However the story instructed by Mazzucato shouldn’t be with out its critics. A better familiarity with the general public alternative literature, or with Alberto Mingardi and Deirdre McCloskey’s detailed criticism of Mazzucato’s ebook, may need led Klein and Thompson to no less than take these criticisms severely. Sadly, there may be little in the way in which of acknowledgement of those objections, not to mention crucial engagement with them.

It’s stunning, as an illustration, that the phrases “cronyism” or “rent-seeking” don’t seem a single time within the pages of Abundance. If authorities is to be within the enterprise of figuring out and subsidizing potential “winners” within the financial system, we’ll in fact hope that it’ll accomplish that primarily based on the very best obtainable scientific and financial perception. However each principle and ample expertise (can we nonetheless bear in mind Solyndra?) present that that is removed from sure. Authorities favors will usually be awarded to not probably the most deserving however to probably the most politically well-connected. And the larger the prize, the fiercer would be the competitors to forge these connections. The end result of such a contest will virtually actually not be favorable to the poor, the small, or the outsiders.

Innovation is a technique of trial and error, and each markets and governments will produce loads of failures. However there are massively essential variations between the character of those failures. Personal companies are playing with their very own cash, giving them an essential incentive to fastidiously steadiness threat and reward; when governments make investments, they’re enjoying with different folks’s cash. Personal companies fail in a means that tends to be small and localized; authorities failures happen on a a lot bigger scale. Lastly, and maybe most significantly, the failures of personal companies are non permanent—failing companies are pushed out of the market by the ruthless technique of market competitors. Authorities failures, in distinction, face no such screening course of. Even probably the most abject failure of a authorities program tends to learn some small, concentrated curiosity group, and that curiosity group has a lot stronger incentives to battle for the preservation of that program than anybody else does to finish it.

Abundance and Comparative Political Financial system

The purpose of those criticisms is to not discredit the abundance agenda. On the contrary, the general imaginative and prescient provided by Dunkelman, Klein, and Thompson is grand and provoking. It’s an agenda that has the potential to unite progressive liberalism’s conventional concern for advancing the pursuits of the poor with classical liberalism’s emphasis on the inventive energy of free, aggressive markets—an excellent adaptation of what Brink Lindsey referred to as the “liberaltarian” agenda. It’s, furthermore, an agenda that channels our energies in a positive-sum route, one which yields compounding dividends over the long run.

For introducing and popularizing this agenda, the authors of those two books deserve our reward. The place they fall quick is within the query of how—what are the concrete steps we are able to take from right here to meaningfully and sustainably promote abundance? Answering this query would require a deeper engagement with the strategies of comparative political financial system—strategies superior by students like Peter Boettke, Mark Pennington, and others. Many tough questions and challenges lie forward. But when we’re fortunate, the abundance motion is simply getting began.

Footnotes

[1] Marc J. Dunkelman. Why Nothing Works: Who Killed Progress–and Tips on how to Deliver It Again. Feb. 2025.

[2] Ezra Klein and Derek Thompson. Abundance. Mar. 2025.

[3] Nicholas Bagley, “The Procedural Fetish.” Niskanen Heart, 7-Dec-21

[4] Peter Schuck, Why Authorities Fails So Typically: And How It Can Do Higher (Princeton: 2014).

[5] See Mariana Mazzucato, The Entrepreneurial State: Debunking Public vs. Personal Sector Myths (Anthem, 2013).

[6] See Alberto Mingardi and Deirdre McCloskey, The Delusion of the Entrepreneurial State (AIER, 2020).

[7] See, for dialogue, Jonathan Rauch, Demosclerosis (Three Rivers Press, 1994).

[8] See Brink Lindsey, “Liberaltarians”. Cato Institute, 04-Dec-06. In an interview with Lindsey, Steve Teles describes the connections between the abundance motion and liberaltarianism. See “Steve Teles on Abundance: Prehistory, Present, and Future,” 11-Jun-25.

[9] As such, the abundance motion has pure affinities with the “longtermist” department of efficient altruism. On longtermism, see William McAskill, What We Owe the Future (Primary Books, 2022). On the overriding long-term significance of financial development, see Tyler Cowen, Cussed Attachments: A Imaginative and prescient for a Society of Free, Affluent, and Accountable People (Stripe, 2018).

[10] The sympathetic critic Noah Smith makes an analogous level. See his “Progressives Take their Best Shot at Abundance (But It Falls Short),” 17-Jun-25.

[11] See Peter Boettke, “The New Comparative Political Economy,” 12-Dec-05; and Mark Pennington, Strong Political Financial system: Classical Liberalism and the Way forward for Public Coverage (Edward Elgar, 2011).