Saving the Climate and the Poor from Sacramento

Luke Phillips
Research Associate for the Center for Opportunity Urbanism and Senior Correspondent at Glimpse From the Globe

California has always been a harbinger of new ideas and bold proposals. That was once a good thing, when California’s economic and social policies encouraged middle-class opportunity, entrepreneurship, and social mobility, way back in the 1960s California described in Kevin Starr’s Golden Dreams. But the contemporary California political elite tends to pioneer the way in policies that endanger this spirit of opportunity that once made California great. Two recent stories illustrate the lunacy our political class substitutes for good policy.

Several weeks ago, a whole raft of Governor Jerry Brown’s anti-climate change legislation was soundly defeated. But this past week, the same legislation passed with some amendments, and Governor Brown signed it into law on Wednesday. The boldest of these proposals called for a 50% cut in petroleum usage statewide by 2030 (amended later to 2050.) Others increased regulatory standards and supported increased usage of biofuels. The agenda is clear- through the power of state government, bring California’s carbon emissions down to lead the fight against climate change through the force of example.

And earlier in the summer, the Los Angeles City Council nearly unanimously passed a resolution to raise L.A.’s minimum wage to $15/hour by the year 2020. Almost immediately, the move was condemned by business leaders and policy wonks across the state and nation- raising the cost of doing business drives industries out of blue urban cores. The intent behind the wage raise, again, was entirely benign. But Angelenos will discover over the next five years whether or not arbitrary wage hikes are the best way to fight poverty. Meanwhile, Mayors Ed Lee of San Francisco and Libby Schiff of Oakland have unveiled a statewide effort to raise California’s minimum wage to similar levels by 2021.

These two policy dramas covering widely different areas have at least one thing in common. California’s political elite still largely conceives the world in the Keynesian economic thinking of the mid-20th Century. Throw a problem at them, and they’ll find some way to get regulatory agencies involved. Carbon polluting the global atmosphere? Set restrictions on how much pollution vehicles and industries can emit. Garment workers in East L.A. languishing in poverty? Raise their wages by fiat, and damn the companies that greedily leave the city in response. This heavy-handed regulatory mode of problem-solving- a crucial component of what Walter Russell Mead calls the “Blue Model”- dominates other areas of California policy, from water quality to food prices to pensions.

The Republican alternative isn’t much better. Out of power and lost in the wilderness since the PR follies of the Pete Wilson administration, California Republicans typically unload pseudo-Reaganite market-based ideas when asked significant policy questions. In the above two cases, their solutions would be don’t put restrictions on carbon emissions, and don’t arbitrarily raise the minimum wage. But the problems of climate change and urban poverty cannot be fixed by absolute economic growth alone.

The ideas of neither the Left nor the Right are adequate. But fortunately, some alternative ways of thinking lie nestled on Californian soil.

An environmental policy think-tank in Oakland called The Breakthrough Institute has been pioneering a new, pro-growth environmentalism called “Eco-Modernism.” Eco-Modernism is premised on the idea of technological decoupling- that is, that the way to preserve the environment is to remove human economic activity from the environment. And the way to do this is to so intensify the use of resources as to be able to meet human needs and wants with far less material. Develop technologies that help you do more with less, and you will no longer need to use more, which means that more of the environment will be allowed to flourish independent of human exploitation.

The Eco-Modernist’s answer to a problem so vast as climate change would not be to reduce emissions through cap-and-trade schemes and limits on the use of fossil fuels. Eco-Modernists would encourage investments in next-generation technologies capable of replacing fossil fuels. Hydroelectric and nuclear power have been providing such clean, carbon-free energy for decades. Eco-Modernists would support government-funded construction of nuclear plants and hydroelectric systems to reduce carbon emissions and fight climate change while providing affordable energy. Technological advancement and government investment can both promote prosperity and save the environment, if used properly.

Meanwhile, the journalist Joel Kotkin, a resident of Southern California, directs a think-tank based in Houston called the Center for Opportunity Urbanism. The Center’s philosophy, “Opportunity Urbanism,” suggests that urban planning and macroeconomic policy ought to be conducted with the goal of expanding opportunities for social mobility and a middle-class lifestyle. Opportunity Urbanists favor policies that maximize the availability of work and minimize the cost of living. In practice, this means business and development-friendly tax, regulatory, and zoning codes and investments in effective public infrastructure and education.

When Opportunity Urbanists are confronted with a problem like stagnant wages and increasing poverty, they do not opt for a short-term Keynesian fix. They fight inequality and urban poverty by encouraging industry and job growth across all sectors through tax and regulatory reforms and a better business climate. They also remove unreasonable land and energy regulations that drive up the cost of housing and utilities. And they invest in quality public education and infrastructure. Market-based policies premised on opportunity and competition can work wonders for the upwardly mobile working class, if carried out correctly and responsibly.

These two Californian philosophies offer compelling, positive alternatives to the reigning green-and-blue consensus. Their shared goal: a wealthy, high-tech society, replete with opportunities for upward mobility, leaving little environmental impact. Eco-Modernist Opportunity Urbanism could present a thoughtful and compelling alternative to the California elite’s current orthodoxy. It would be proof that you need not stifle economic growth to demonstrate your care for the environment or the working class.

There are at least two policy areas where the philosophies conflict, however, and if such a synthesis were to become viable, these differences would need to be addressed.

Eco-Modernists don’t particularly like suburban sprawl, because it takes up more land than densified urban cores. But Opportunity Urbanism strongly encourages suburb formation. Meanwhile, Opportunity Urbanists support fossil fuel use for the indefinite future to provide cheap energy, while Eco-Modernists seek a gradual phasing-out of fossil fuels and their replacement with nuclear energy.

There’s a fairly straightforward policy compromise evident here. Eco-Modernists ought to accept suburban sprawl as important to economic growth and opportunity, and recognize that human housing needs take up comparatively little land. Opportunity Urbanists, for their part, should accept that nuclear energy can provide more sustainable and lasting energy than fossil fuels, and a more electrified and nuclearized power system will be healthier, provide cheaper energy, and generally provide a better quality of life for more people than fossil fuels ever could.

So Eco-Modernists give up their hostility to Suburbia and gain a zero-carbon nuclear platform, while Opportunity Urbanists give up on fossil fuels and retain an opportunity society with even more advanced energy technology.

Aside from this great compromise, Eco-Modernism and Opportunity Urbanism can complement each other very well. Intensive government investments in infrastructure, technology, and education drive the economy; market principles and expanded economic opportunity distribute its fruits. This strong-government, market-based synthesis begins to resemble the economic philosophy of Henry Clay and Abraham Lincoln, that old Whiggish tradition that has unfortunately left us for the time being. Perhaps Californian ideas will resurrect it.

What better state to articulate new philosophies and a new synthesis based on innovation and opportunity, and put it into practice? California has always been about creating something new, and giving individuals the chance to create themselves anew. The state’s policy should reflect the state’s character.

But the ideas need to be out there first. Perhaps it is time for Eco-Modernists and Opportunity Urbanists to enter into dialogue with each other and establish a common policy agenda for the Golden State. The dominant Democratic Party and the floundering Republicans don’t have these ideas. Someone needs to show them the way.

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