Charter Cities Podcast Episode 22: One Billion Americans: The Case for Thinking Bigger with Matthew Yglesias
A conversation with Vox co-founder, policy writer, and celebrated journalist Matthew Yglesias
Vox co-founder, policy writer, and celebrated journalist Matthew Yglesias knows what would actually make America great: more people. Today we speak with Matthew to discuss this idea as captured in his book One Billion Americans: The Case for Thinking Bigger. After introducing him, we dive straight into the topic and ask Matthew to unpack how population growth will benefit the US. He then shares how his book appeals to both sides of the political spectrum, despite the backlash that his ideas have received. We compare historical US immigration with the current economic climate before looking into why immigration doesn’t necessarily lead to infrastructural challenges, as is often argued. While reflecting on how policy choices impact public projects, we touch on the COVID vaccine rollout and explore issues within America’s political culture. Later, we hear Matthew’s take on whether an ascendant China will forge a stronger America, the positive effects of inclusive American nationalism, and how giving people access to opportunity fosters innovations. Near the end of the episode, we chat about how policy affects birth rates, how zoning reforms might inspire stronger agglomeration, and why Matthew left Vox. Matthew presents a clear vision for how we can increase national prosperity. Tune to hear more of his insights.
Transcript (edited for clarity):
Mark: Hello, and welcome to the Charter Cities podcast. I’m your host, Mark Lutter, the founder and executive director of the Charter Cities Institute. On the Charter Cities podcast we illuminate the various aspects of building a charter city, from governance to urban planning, politics to finance. We hope listeners to the Charter Cities podcast will come away with a deep understanding of charter cities as well as the steps necessary to build them. You can subscribe and learn more about Charter Cities at chartercitiesinstitute.org. Follow us on social media, cci.city on Twitter, and Charter Cities Institute on Facebook. Thank you for listening.
Mark: My guest today is Matthew Yglesias. He blogs at the Substack Slow Boring. His most recent book is One Billion Americans: The Case for Thinking Bigger. He is also the co-founder of Vox and the host of the podcast Weeds.
Welcome to the show, Matt.
Matt: Good to be here.
Mark: So you recently published your book, One Billion Americans. So why is America too small?
Matt: I think there are a lot of benefits to population growth that exist in the world, benefits for productivity, for market size, things like that. The sort of big overarching frame of the book is to try to motivate people and reach a sort of different audience is that I also talk about the international role of the United States. The United States of America is a great power in a way that Canada or Australia, some sort of broadly similar societies are not. And that's because we have hundreds of millions of people and a giant GDP that supports a kind of global presence.
There's a lot of anxiety in Washington and both parties now about China, about the fact that the globalization will turn them into a nice democracy thing didn't really work out. And people need to think about how we should respond to that, right? And is it going to be — will we just like give up and decide we don't care? Is it going to be a violent military confrontation? Or are we going to think about what are the kind of wellsprings of power, of Chinese power, is certainly their incredibly large population. And can the United States look at sort of enhancing ourselves by doing more to encourage immigration by doing more to think about how our urban life works and doing more to encourage children here.
Mark: Well, yeah. And what I found, I think very, interesting about the kind of proposal is it's a way to sort of a way of kind of creating or maybe recapturing a national identity in the sense that there has been this historic national identity in the US that's been a little bit of kind of this melting pot. This growth. And you try to kind of appeal to conservatives or Republicans by saying, like, “Look, we have this, like, national greatness is a good thing. America is pretty awesome. Let's figure out how to get more of this.” And then you also are trying to appeal to folks on the left by kind of going with a lot of their policy preferences by saying like, “Hey, let's get a lot more immigrants. Let's have this whole like melting pot national ethos.” One, is that an accurate summary? And then two, how do you think the reception has been in terms of this, like, reframing of the challenge and the level of interest from both sides and not reframing?
Matt: I mean I think we're now long enough out into the release that I can just tell the truth and not bullshit people. The way a book works, right?
Mark: You heard it here first.
Matt: You come up with an idea with your agent, and you write a proposal, and you send it around to publishing houses, and you get a contract, and you work on the book, and then you've got edits and proofreading, and then it takes a while before it comes out. So back when this book was conceptualized, we weren't talking about mobs storming the capital. We weren't talking about Donald Trump gaining 12 percentage points in Rio Grande Valley, but losing anyway, right? My assumption was that we would continue to be in the political dynamic of 2016-2017-2018. That very heavily focused, on a president who was saying, “We need to make America great again and we need to do that by kicking out immigrants,” right?
And so I spent years thinking about that phenomenon. And what I thought was wrong about it, and I don't think that the correct way to respond to that sentiment is with totally neutral globalist cosmopolitanism. I think there's a lot to be said for cosmopolitanism, but I also think that it is analytically wrong to say that immigration is contrary to American greatness. That immigration is actually the wellspring of American greatness.
My thesis, some people have noted, it's a little bit similar to a book that a Canadian journalist named Doug Saunders wrote called Maximum Canada. So I love Doug's book. One of the points he makes is that Canada suffered an incredible amount of immigration to the United States during the sort of heyday of industrialization in the US. That Canadians flock to the Midwest and New England to go work in factories and it left Canada as a much poorer and weaker kind of country. That's like a good analysis, right? Like if you want to understand why Canada, which is physically larger than the United States and has more fresh water and more open fields, is so much of a weaker country. It's that the United States attracted immigrants, whereas Canada sort of expelled them. And some of that was just the weather. It's really cold in Canada, but that's something we should be proud of.
The Statue of Liberty and Ellis Island are big icons of American greatness. I think when you look at who can give you in a no bullshit way an account of why America is a great country. It's immigrants more than anybody else, right? Now you can do a bullshit version of it where, like, you pretend nothing bad has ever happened in America or that like any discussion of racism is evil or something like that but that's not right. But if you look at the life story of somebody like Kamala Harris, right? Her parents were aware that the United States had its share of social problems when they moved here. But it was still, like, even given those problems, an incredible land of opportunity for them that they embraced just the same as my great-grandparents did coming from Cuba and from Poland and Lithuania. And that was what I wanted to key in on, right? That an America of growth and openness and inclusiveness is the greatest version of America that exists.
Politics is unpredictable, and things wound up going in a somewhat different direction from what I was anticipating. So I wound up getting more, I think, support from conservative people and more blowback from left-wing people than I sort of had guessed when I started the project.
Mark: Really, because I don't know. I mean my intuition is that that would be because the framing was to a certain extent inherently conservative framing. It was this focus on national greatness. It was kind of trying to make the case for immigration to conservatives. And, I don't know. Maybe the somewhat demoralizing implication of that fact is that conservatives, kind of the left, doesn't like American greatness more than conservatives don't like immigration.
Matt: Well, I mean this is why I think there's like an ebb and flow of politics, right? I mean, I think that George Floyd's death and the subsequent racial reckoning of 2020 has gotten mixed in with sort of anti-patriotism in a way that I don't think holds up to like a ton of analytic scrutiny. Like, ask a black person about walking around in Denmark. And like racism is a very real issue in American history and in the present, but I don't think it's uniquely American in any particular way. Whereas I do think that America's embrace of immigrants, well, not a wholesale thing, but a very real thing I think is kind of distinctively American. Maybe not uniquely, but it's different. We do not have people who will say that like — well, I’ll put it differently. I did an exchange thing. I was living in France, and I witnessed kind of someone getting mugged, beaten up on the street, and I went back home to my sort of host family's house and I was talking about the situation. And my host family there, he was asking like, “Well, who was it? Was it a real French person?” And I was like — I know what you mean, right? But people don't talk in those terms in the United States, even people who have very sort of anti-immigrant views.
Well, one of the asymmetries in American life is that conservatives care, I think, a lot about abstract symbolic topics and not that much about concrete policy specifics. So it turns out that when you give something a kind of conservative iconographic frame that does, like, that does a lot of work, and I possibly like over-corrected.
Mark: Sure. Let's try to steal, man, kind of the case and maybe against immigration here to bring out some of the stronger arguments. So one point kind of point, argument might be that in the 19th century, when there was a huge amount of immigration to the US, part of the reason the US was able to really effectively integrate that large amount of immigrants was a genuine labor shortage. So, for example, if you look at, like, average wage rates in the US in the 19th century, particularly for lower skilled people, they were relatively high. So you would have kind of peasants coming from France or Germany or wherever where there was a genuine land shortage. They come to the US, where it's like, the US is very big. There's a lot of land. And so that labor shortage kind of boosted wage rates. Made it much easier to integrate these immigrant communities. Well, today, US wage rates are still higher than most of Europe, but it doesn't seem like as true in some sense that there is that, I don't know, lack of the demand for labor just doesn't seem as high as it maybe it did when there was — the US was a more agrarian culture and there was a much larger set of land available.
Matt: Well, I mean I think if you look at Michael Clements's research and if you look at the wage gains that people from poor countries secure when they move to the United States, they are still spectacularly high for unskilled people. Their incomes can go up four, five, six or even eight-fold by coming here. And for skilled workers, there's also incredible premiums. We've all talked a lot about remote work over this past year. And I don't know exactly where that's going. But at least as of 2014 or so, an Indian software engineer can see their earnings go up five-fold by getting an H-1B Visa. And the terms of H-1B Visas are not that friendly to workers. But nonetheless, you're securing giant wage increases, which is one reason why employers are able to get away with — I mean, you look on paper at the terms of that and you're like, “This is a terrible deal. Like, who would even want to do this?” Because you're talking about people who have valuable labor market skills in potentially remotable things, but they still want to do it. So you see, I think, really big gains on the labor side.
I think the biggest problems with immigration, I mean the valid ones that take up a lot of text in the book and probably fit the theme of this podcast, are the questions about sort of infrastructure and housing and like — because that's the difference, right? When you had abundant land, you could say to people like, “All right, just go wherever. Like, build yourself a hut. We're not going to worry too much about it.” And of course the actual living standards in those pioneer communities were abysmally low by today's standards. If you had that, you would say, like, “Well, now we just have shantytowns on the outskirts of our cities, and that's terrible.” So accommodating people into a modern infrastructure environment is challenging.
Mark: We found one of my, I think, I guess, my great-grandparents letters. They had immigrated from Switzerland. They were sending a letter back home to Switzerland and it was something like, “Found some very nice land and last year, it was very cold. We were living in a tent, but now we built a wall. We want for nothing.” And it's like, “Okay, you built a wall. Like you've got a stream, that's like, I don't know, has some clean water in it, and like you want for nothing.” This was, I think, the 1920s. So it wasn't even that long ago, and it's I think a little bit mind-blowing how our expectations have changed.
Let's get I guess a little bit more into that infrastructure question. If we look at China, for example, Shenzhen added about a million people I believe from 1996 to 1997. We look at kind of the major American cities today. New York — I mean New York population, I think, has decreased by like five percent since 1950, or so. It costs a few billion dollars to just build a few miles of new subway. Like LA, Chicago. LA, we’ve seen population increases. But Chicago population decreases. And to be able to effectively integrate a large, new populations, this also requires the building of better infrastructure. And so what does that actually look like and what would have to change in terms of our ability to start building infrastructure again to allow the effective integration of much larger communities of immigrants?
Matt: I mean we have two cases here, I think, really. One is the sort of — we can call it Midwestern, but it also includes places like Buffalo, Hartford, and Connecticut. But in the not stellar stops, parts of the Northeast and Midwest, you do have a lot of cities that are actually now under-populated relative to their peaks, right? And so they actually have infrastructure that's underutilized. Like Cleveland used to be a major international hub airport, but enough people have left, enough economic activity has left that the airport is now greatly underutilized. I don't want to tell you a traffic jam has never occurred in Cleveland, but they have low levels of traffic congestion. They have a modest but real rail mass transit system there that runs at low frequency and obtains low levels of ridership, because A, there's not that many people in Cleveland. And B, since there aren't huge traffic jams, it's not incredibly compelling to sort of ride the train there.
And so one thing that we can do that I advocate for — that I believe is officially a Biden policy proposal somewhere. But came out of the US Conference of Mayors, is to let cities that have suffered population decline sponsor visas for immigrants to sort of bring people into places where there is surplus of housing and infrastructure and where new people would actually bolster the infrastructure by making it affordable to maintain it. Like in Detroit, they're eliminating street lights because the population has declined so much they literally can't afford to keep the lights on. So that's terrible.
Then we have our coastal communities where housing is in very short supply because of difficult zoning regulations and where the transportation situation is not great and people — Los Angeles, in particular, really ought to change its land use rules and let people build denser housing in what's a very big city that is trying to live like a bunch of suburbs. At the same time, they do have serious traffic congestion problems there. People worry about that getting even worse. And we need to both allow for more house building, but we have to start tackling some of the issues in civil engineering construction, which is a conceptually difficult problem. There's a new sort of line of research that's being led by a couple guys. I know Eric Goldwyn and Alon Levy looking at international comparisons in these construction costs.
The main thing I will say is that we know from countries ranging from Italy and Spain, to Turkey, Korea, Sweden, that it is possible for a developed country to build a tunnel for a fraction of what we are currently spending in the United States. Like, some things we can't do, right? Like we can't send you to Mars for the afternoon. Maybe someday, but like it's not technologically possible. And it's also not possible to bring back incredibly labor-intensive craftworks, because the economy has changed. But we are not operating construction projects, particularly underground construction projects, in a cost-effective way because of policy choices rather than fundamental technological limits.
Mark: So you think they are, I guess, policy choices? Because I’ve been thinking about this a lot recently and I’m perhaps not as well-read as you on kind of tunneling and creating new subways. But, for example, this was in I believe the Washington Post like a week or two weeks ago where Governor Hogan, the governor of Maryland, was basically saying something like trying to get — increase the vaccine rollout.
And so, to me, this like it presented a little bit of a, I don't know, conundrum, in the sense that part of the reason for the slow vaccine rollout has definitely been leadership, right? Kind of if — we look at what Cuomo is doing in New York, what Newsom is doing in California, right? Basically poor leadership making — requiring, like, overly stringent rules for dispersion and, like, very high fines if you disperse two people out of order. But here in Maryland you have a governor who is basically saying, “No, like, go faster.” And it's still slow, which to me suggests this kind of like, I don't know, underlying cultural malaise where people are kind of afraid to — It's the Teleb argument in terms of intellectuals. People who are afraid to take responsibility, afraid to take charge, afraid to make decisions. And have basically gotten like master's degrees and figuring out how to offload responsibility and kind of get credit without actually ever committing or doing anything.
And I’ve been kind of increasingly, I don't know, thinking about this. It's definitely partially policy, right? Policy is important. But to what extent do you, like, put these cultural conditions? Do you agree at all with that diagnosis? And how do you weigh that opposed to the policy in terms of improving things?
Matt: I want to say something specific about the vaccines, actually, because I think you and I probably inhabit, like, somewhat similar online niches where people talk about this. And I do have to say, because I’ve been talking to some people who are working on the vaccine rollout. And one big issue is that — our view, right? Like people like you and me who are here online and are like, “Oh my God! Why are we doing this so much more slowly than the Israelis? Like, what the heck is wrong with everybody?” Are a minority of the public, right? That there is huge blocks of people who are not, like, anti-vaxxers, but they are concerned that this whole approval was maybe a little bit rushed. That they hear all this stuff about how there's never been a vaccine on this timeline before. And they're kind of, like, they want to see other people take it, things like that.
I think all of that is wrong. I think that if you get, like, FDA pills and stuff, you understand that this process has not really been that rushed and things like that. But I think that that is largely a public information question. That it's like, people on our side of this argument have actually not won the argument. The electorate in Maryland is not impatient with Larry Hogan. And sort of that's the issue here.
So backing that out, one thought behind my whole book is, like, I would like Americans on a citizen level to have a higher sense of urgency about our national problems rather than what I think we currently have, which is an incredibly high sense of urgency about the risk of the other political party winning an election and governing, right? So, like you can get a mob to storm the Capitol and beat a police officer to death to avoid the scenario that Joe Biden might become president. And you could pull — I mean, they were, thank God, not violent like that, but millions of people went out in the streets in January 2017 in the women's marches to protest Donald Trump becoming president. Like, people were really fucking pissed about that. And then the Trump people are really mad about Biden. And people are not as mad about America's relative decline in the world, right? Like it is not a subject of urgent concern that we, like, do things and execute on projects faster.
And in fact, in general, the public is so concerned about the downside risk of elected officials they don't like governing, that they tend to embrace procedural tools of endless gridlock, right? Like the fear about everything is, “Well, what if Trump rushes through a fake vaccine?” Not, “What if our vaccine development process is too low.” Not like, what if systematically it is too difficult to do things. And people don't want to embrace what I think would be the healthier vision where elected officials have, as you say, responsibility to solve problems, but are also equipped to solve them. And then if the problems are not solved, like, they are punished by voters at the polls rather than what we have right now is like everybody wants to make sure that their hands are tied. That nobody can take bad affirmative actions. Elected officials spend a lot of time shifting blame onto each other, right?
So like Pedro Cuomo and Bill de Blasio have just spent an incredible amount of time over the past year talking about how the other one is responsible for various things going wrong. Nobody wants to say — “I’m putting this on my back.” We're going to do what I say. And then it's going to work out great and I’m going to be a huge hero. But the voters aren't calling for that, right? It's like the approval ratings of a lot of sort of do-nothing governors are incredibly high.
Mark: I mean Cuomo is on — I think he might have finished his victory tour already, but he wrote a book about his success at dealing with COVID when he had the second-highest like death rate in the country.
Matt: But I just mean, it's like it's so much bigger than COVID, right? So like Charlie Baker has had these just astronomical approval ratings throughout his tenure as Governor of Massachusetts because he says that Donald Trump is bad. Which people in Massachusetts appreciate. But then he's a republican, so he, like, sometimes says the state legislature is bad. But he doesn't have any signature achievements, right? Like nobody says, “Okay, Charlie Baker has a 70% approval rating because he identified this big problem in Massachusetts and then he solved it.” Right? It's that he didn't empower the legislature to overreach in the way a Democrat might have. But he's also not like a bad republican who does things that would make centrist Democrats mad. And people love him, right? Like, he's got like amazing numbers. And that to me is depressing. Like the most popular governor in America should be someone who like took on a big entrenched problem and fixed it and who now we're saying to the other 49 governors like, “Why don't you do that?”
Mark: Yeah, I think that is a good point in that people aren't really, I guess, demanding it. Which is why I kind of, I guess, point to this — what might be described as, I don't know, broader kind of culture of malaise. Because I see it as not just — you have the politicians that are so in part because of the demand for moving quickly and like having big projects isn't there. Then, additionally, this is kind of the Tyler Cowen point with the great stagnation is that the people have gotten, I don't know, more kind of policy conservative in terms of not moving as quickly. And so, one example is when COVID started, there was a lot of initial deaths in nursing homes. I remember I sent a very like a angry, somewhat threatening letter to my grandmother's nursing home where I was, like, considering hiring a lawyer and basically suing them because I was thinking like, “Look, you should be testing people every day. Obviously you don't have rapid tests, but just do a temperature test. Like start wearing masks, etc.”
Which, for people who are spending too much time online like I do, it was like, I don't know, somewhat obvious. You had Silicon Valley that was, I think, very prescient in terms of understanding those risks. And I don't know if this is incorrect or correct, but my kind of operating assumption is that the equivalent to a nursing home in 1950 would have been a lot more on top of this. And in the sense that they would have acted much more quickly, they probably would have gotten a lot of things wrong early on because kind of you do currently. I mean and it's a combination of I think probably like liability to lawsuits kind of, but it's also just this, I don't know, like fear of things outside.
And kind of the analogy I used and the way I think that Silicon Valley was able to understand this risk and obviously using COVID as an example, but I think it's broader, is because at least in SF there is this like entrepreneurial culture where people are actually responsible for, like, an entire thing. Or if you look at most bank CEOs, right? If you're the CEO of Morgan Stanley or J.P. Morgan or whatever, you go through a pressure cooker of working your way up the chain of a seniority where you always have a relatively circumscribed view of the set of actions you can take. So you never have this really wide ranging set of decisions, where, if you're in an early stage startup, you do have that wide ranging set of decisions. And so it's embedded this, I don't know, culture that forces people to be able to quickly understand these external shocks much more effectively. And in a US that was a little bit less bureaucratized, right, like I feel that there would be, I don't know, more of a sense of doing that. And that's, I don't know, the cultural malaise that I’m attempting to articulate.
Matt: Yeah, I mean it's possible. I guess it strikes me that on both — these are two very disparate topics. But on both COVID and tunnel building, the best examples are from the sort of democratic countries in east Asia, right? Japan, Taiwan, especially Korea, have done the best on both of these things. I don't know that that's related. I’m actually 100% open to the possibility that it's a total coincidence and just happens to be two things that I was paying attention to.
One thing I will say about that, though, is that those are not societies that, like, we have these kinds of stereotypes where it's like, “Well, Bay Area entrepreneurs, they're very like flexible and independent-minded. Whereas, like, maybe the New York businessmen are more stodgy and they wear suits, and like in D.C., the politicians are like the stodgiest,” right? So Korea is definitely on the stodgy end of that spectrum rather than the like, “Hey, man. Like let's go do whatever.” And so I think they feel that it's the opposite — that it's like somebody got Singaporean, but he knows the US well and he knows Asian well. He pointed to me the sort of, like, famous Steve Jobs Apple ad about — “Here's to the crazy ones,” right? And he was saying, which I think is true, is that like that ad is very American, right?
Like we should say it's good to like not follow the rules or listen to people or do what you're told, because that's how you change the world. And he was saying he's not surprised that America led the world in inventing COVID vaccines, but also just could not solve a social organization problem that involved telling a bunch of people like, “Here's a thing you don't really want to do and that the benefits do not fully internalize to you, but that we will all be better off as a society if we can act collectively.” Like he was saying that's a very Asian thing and a very opposite to Steve Jobs kind of thing. So I don't know. I mean I don’t know if that's right or not. We sort of got to rerun the tests.
I’ve been struck by the vaccine rollout in Israel though, which is that unlike most developed countries today, Israel continues to operate under a sense of national threat and like paranoia and preparation for all of society mobilization. And you really see that on their vaccination, right? Like, they're doing all this stuff and you can point to it here and there, but it involves, like, putting a lot of people out. A lot of people, not just one guy in the government are being asked to do like not what they would ordinarily do in terms of violating the tenets of their religion. In terms of Bibi Netanyahu going to the Palestinian towns and addressing people there in Arabic in a friendly way rather than doing his usual like politics, right? And that's what I feel like we haven't actually had in America, right? —
Going back to, you're saying at the beginning, like, you want the nursing home to like do something different, right? Like it would be inconvenient to them to do that, but you would like them to do it anyway. I don't know. Like, we haven't had that here, right? There has not been a sense of we'll set an ambitious goal and we'll all go do something and then we'll be better off in the end. Or even mobilization at all, right? It's like if you're listening to this, what can you do, personally, to like help facilitate the vaccine rollout? And the answer is nothing, right? Like nobody is saying we need a hundred people to like go make sandwiches so people can stand in line here. We need cotton swabs. Like, I don't know what they need, right? But like they must need something, something some people could do. Like, can you go get trained to do this to give people shots? Like, how hard could it be to learn how to safely inject somebody with a vaccine? It's not trivial. I wouldn't just go do it, right? But you could learn. But they're not trying to teach anybody. And that is a shame to me. It's just that there's no urgency. There's like no sense that if you asked people to pitch in, they might want to do that.
Mark: Yeah. There's a really good Tanner Greer essay, I think about six months ago where he kind of contrasted Tocqueville describes America where kind of if — if there was a problem like a bunch of Americans would get together, form a committee, and then like figure out how to solve that problem. And today it's much more of a kind of appeal to management, where if there's a problem, you just like, go and call on the higher power. Whether it's a state government or national government or some corporation to go and use their firepower. And it's much less of an entrepreneurial spirit and much more of a kind of like, I don't know, overseeing spirit.
So you made an interesting point about, I think, Israel that it has this existential threat for all of its existence that's caused its society to be formatted in a slightly different manner. And that theme, I think, is also in your book a little bit to the extent that, like, focusing on China might cause America to kind of get its act together. And focus a little bit more on execution and accomplishing things. This is an idea that I kind of have been, I guess, playing around with, is trying to think about the extent to which governments act because of competition and the extent to which governments act because of initial conditions. Because, if we look at the US, a lot of conservatives are like — “The American Constitution is what caused America to be awesome,” except then you look at Canada and you look at Australia and you look at New Zealand, and those are all very similar societies that were basically colonized by the UK that did not have major indigenous populations. Or if they did, they were genocided.
And right, the US has some important differences. We have stronger free speech protections because of our constitution. We also have stronger gun rights because of our constitution. But like, broadly, the societies have turned out quite similarly, and that seems to offer evidence for the kind of initial conditions argument. Same time, right? There is the Israeli argument. And then looking at kind of late stage medieval Europe, there was a lot of competition between governments that did lead to kind of the emergence of modern states and state capacity. And so how do you think about balancing these two things and would even like, I don't know, even if we do take China seriously as a threat to our national greatness, would that be sufficient to kind of kick our butts into shape?
Matt: Yeah. I mean these are some really deep questions about the development of the world over time. I think that one of the initial conditions of America has been diversity, always. It's funny, because to people sort of schooled in contemporary politics, the politics of the 13 colonies looks, like, comically homogeneous. But at the time, the difference between congregationalists and episcopalians seemed really, really important to people. And there was no real precedent for intense political collaboration across those confessional lines. But the exigencies of the political dispute with Great Britain caused people to sort of come together, right? And that's been one of the attributes of American history, is a lot of internal tensions along different lines because it's a big somewhat open kind of society. But also an ability to unify around certain kinds of principles and icons and rise to certain kinds of challenges.
So that is my pious hope, right? Is that in the future, as during the world wars or the cold war or the war against the United Kingdom, that we can transcend some of the things that right now are obsessing us in a kind of divisive sort of way. Of course, possibly we won't and like we'll just sort of fail. This is not a predictions kind of book, right? It's an advocacy. I would like us to try to not fail. And I would like us to see that one of the things that is distinctive about the United States is its success over time in incorporating bigger and broader groups of people into its national identity.
People sometimes ask me. They're like, “Well, what about this book? Like does this all apply to Finland?” And the stuff about like agglomeration economics absolutely applies to Finland. The stuff about like how cities work and innovation and scale, like all of that applies. But if a Finnish person was to tell me like, “Hey, I’m a Finn. This is supposed to be a land for Finns. Like it's there in the name. It says it on the box.” I don't know. It's like it's not my place to tell Finnish people who their land should be for kind of.
But America, to our great strength over the years like, has not been like that, right? Like people come here from all different places. And one way that we're different from Canada is that we're a little hokier, like, about our flags and our songs and stuff like that. And it's because we're trying, right? Like, we're trying to get everybody on the same team and cheerlead in a way that does not a hundred percent hold up to rational scrutiny, but that I think has been very sort of functional and constructive over time. And I think that all of that is good. And I kind of want people on both the left and the right to be a little more upbeat about both, like, America as a thing, but also about diversity and the prospects for change. Instead we have a lot of kind of paranoia, I would say, almost these days.
Mark: Cool. I want to actually, I guess, question your point about the agglomeration effects. It's a point I’m generally sympathetic to, but kind, of if we look at like the progress studies, recent discussions there where one of their primary points is that a lot of areas of human progress are not evenly distributed throughout time. And so, for example, if you look at ancient Athens, it's this huge blossoming of creativity, of intellectual output and it has a population of like 50,000, right? That's not even something we would really call a city in the US.
If we look at kind of Vienna prior to, in, like the early 20th century, again, like large city in Eastern Europe, but it has this huge flourishing of intellectual output. And so, well, I guess I understand like there are kind of the broad like scalability arguments. We can also look at, for example, Israel today. I think they might even have more, like, unicorns in all of Europe despite it being a very small country without a very large internal market. So, like, there's the Romer-esque point which you make in the book that like kind of scale matters, more people matters, more ideas, etc. Then there's what might be called the kind of the counter argument, which is that progress is a little bit more, I don't know, maybe elitist. I’m not sure that's the right term. But it tends to happen from, like, a less important than kind of the scale, the bigness of the market, the number of people, etc., is kind of the quality and like what is actually happening. So what's your response to that?
Matt: I don't know, man. I don't want to get in trouble. But, like, two of your three examples and like both of the ones from anything remotely recently just involve large agglomerations of Ashkenazi Jews. So I don't know. I’m going to put that aside. And I think that yes, like all of this stuff matters, right? Like culture and what's happening and people work with each other. I don't know. There's like a certain magic, I guess, that occurs at certain times and places. I don't know anything about classical Athens other than this is, like, a thing people say about it that they had a lot of big ideas there. But I think that in policy, if we knew how to make new inventions, like we would just do it. Like I certainly — I don't know how to invent anything. But we can ask what are the circumstances under which it is more possible to have them, right?
And so a person living in Haiti has a really bad chance of inventing anything or contributing in a big way to the advance of human knowledge. They don't have the nutrition. They don't have the resources. They don't have access to the internet. They don't have an investor who could support them. They don't have people they could collaborate with. If they are able to move to the United States, they probably actually still aren't going to have those opportunities, but their kids might. And we have tons and tons of that, right?
The United States is both a place where a lot of immigrants, where a lot of children of immigrants have stumbled into being entrepreneurs and where a lot of people from countries that are not as poor as Haiti where there are some opportunities decide that the US is the place to go to continue pursuing that. And there's a heavy degree of unpredictability about it, right? There're some people who are very focused on, “We should let skilled workers come here. We should let lead people with degrees,” and that's great, like, I’m all for that. But a lot of our leading innovators are people who gained opportunities in the United States without necessarily having been specially selected. Or these BioNTech guys in Germany, right? One of them, I think, came as a little girl because her dad was a doctor and the other one's dad just, like, worked in an auto factory. Like neither of them are people who would have made it under like we want the inventors to come to Germany. They're just people. But Germany is a much better place to grow up to be an inventor than Turkey is, and there are a lot of places in the world that are worse than Turkey.
So making sure that people have those opportunities I think, fairly reliably leads to sort of more invention and more innovation. It's not all there is to it. And I’m, like, not really a science policy guy. Like I don't know. We should do something different with our patents. I mean, who knows? But I do know that I think a lot of the debate on immigration is very narrowly focused on short-term labor market allocations when we know that the driver of prosperity over the longer term is innovation and growth. Not like what exactly do you get paid to work at a supermarket in Orlando? And that opening up the doors of opportunity to more people is going to drive that forward in a way that scales and has incredible spillovers like way beyond super localized wage effects.
Mark: Cool. So you focused a lot on — and our discussion is so far focused a lot on immigration. One of the other topics you talked about in the book is increasing birth rates. The US has historically had much higher birth rates than most other kind of Western countries. But in the last decade or so, we've fallen below replacement level. I think we're at 1.7. But like historically there have been a lot of attempts to increase birth rates. Lee Kuan Yew talks about this in his book, From First World to Third, and I mean he's arguably the greatest statesman in, like, the second half of the 20th century. And he was unable to really do it. So what levers can we realistically push for increasing birth rates?
Matt: I think that there's been a kind of an overlearning of lessons here, that most pro-natalist policies historically are advanced by cranky right-wingers who hate the idea of expanding the welfare state. But they're like, “Man! Ugh! Ugh! Maybe if I did this, maybe just for the sake of having people have more kids, it'll work.” And so then they try and it's like, “Well, you spend a bunch of money. You have marginal impacts and then you decide to give up and abandon the program,” right? I’m not like that, right?
So like when I read that Sherrod Brown and Michael Bennet's Child Allowance Bill would reduce child poverty by 60%, I thought like, “That's great. That's a good reason to do it. Child poverty is really bad. Go Sherrod Brown!” But then I read from Lyman Stone that based on his sort of calculations, estimates from other sort of child support programs around the world, well it would also generate about probably .24 extra children per woman over the course of a lifetime. I thought, “Oh, that's interesting.” And I looked around, and none of the progressive people in Washington, none of the people who work on policies like paid family leave or child allowance or things like that, none of them talk about the impact on fertility. It's very stigmatized in left of center circles in the United States. But if you are a left of center person and you think of these as, like, good ideas, then they don't seem like cost ineffective fertility measures , right? They seem like good ways to build a more just, more fair society that will also have the impact of raising the birth rate. And of course they should, right?
If you think about them from a progressive point of view, people who would never use a word like pro-natalist. What you are trying to do is help the parents of young children have easier lives and a higher material standard of living. So of course if you do that, there's going to be more children, right? It's if you're reluctant to do that, then the marginal impact on fertility looks disappointing, or you start coming up with gimmicky stuff like Viktor Orbán who'll, like, give you a big bonus if you have five kids. But nobody wants to have five kids, right?
But plenty of people are on the margin between one and two and two and three, and the sort of financial motives there make a difference. Not a huge difference. If you think these programs are terrible ideas, you're not going to have your socks blown off by the fertility impact. But if they seem like good ideas to you, the impact is real and I think pushes the United States back up to closer to its 1980s level of fertility a bit above two. It's still not like actually that high in global historical terms. Because on a macro level, this stuff is driven by religiosity. And do we need farm labor and like all kinds of other stuff. But on a micro level, I think it makes a meaningful difference. And I think it's something that people who are advocating for sort of family support policies in the welfare state ought to think about, is, like, what are the implications of these design choices for fertility?
Mark: The other thing we could do is ban car seats.
Matt: Ban car seats?
Mark: You didn't see it. It was —
Matt: — So the car seat mandate. Yeah. This is a super interesting one. It's actually a really good example. So kids have to be in car seats, which seems good. It saves lives. But, if you think about it, if you have a kid or you have a car seat, it's easy to put two car seats in the back of a car. And almost everybody in America, particularly parents, owns cars. And car seats themselves are not expensive. So the cost benefit of car seats is really good. It's strong. But you can't fit three car seats in a car in a standard car. You have to buy a much larger, much more expensive car. So they find that when they raise the age at which you sort of like age out of needing a car seat, the benefit there is pretty low, because older kids, you have lower benefits. And the cost of having a third kid starts to get sort of surprisingly high because it's not the cost of the car seat. It's the cost of a new much bigger car.
It'll be interesting. I mean, I think we probably could use some more work on this. But they found a strikingly large impact on the number of third kids just of this car seat thing. And an issue there, right? I mean, I think like the bigger takeaway is that the cost benefit analysis does not include fertility impacts, right? You're looking at fiscal costs versus live saved. So in this case — but the like non-existence of people is not registered as a form of cost. And I don't think that's the right way to look at it, right? When we are assessing regulatory policies that have to do with little kids, we ought to try to look at the fertility impact as well.
Mark: Yeah, I agree with that. So one of the points you also made that I found interesting is like, I guess, in progressive circles talking about fertility rates is — it's taboo. There isn't a focus there, which I guess is sort of intuitive. I’ve never really thought about it before. But I mean, is there any way to kind of change that? You see on, I think, a lot of left circles, people are afraid to have kids because global warming is really bad. I’ve gotten in discussions with people, like, more Americans are good and they're like, “Oh, America is terrible. Look at all the bad things America has done.” And so you do have this kind of, like, reflexive — I mean anti-natalism might be too strong, but like this reflexive kind of not as much interest in kind of having more children. I don't know. I haven't seen any broader policy discussions or, like, kind of higher level discussions about that, but do you see that kind of changing anytime soon?
Matt: I mean, this is like hard anti-natalism, right? Which is like grounded, in principle, in a considered view, then I think it's just wrong and not that widely held, although somewhat widely broadcast because it sort of makes for an edgy take. I talked about this with Matt and Liz Bruenig on their podcast from different points of view, and it is tied up with sort of eco-dystopian rhetoric. But I question how seriously people take that. Like, nobody says, “Well like we should bomb the coal plants in India to stop climate change.” Which, if it was genuinely threatening human extinction, like, would be a no-brainer, but is actually a terrible crazy idea that you absolutely should not do because it's a serious problem. But like many serious problems, you have balance of considerations.
I think there is a question of basic manners though, which is the real kind of thing here, which is that my book came out and more than one childless female colleague of mine sent me screenshots of, like, their parents texting them like highlights from my book being like, “See? See?” And that's super obnoxious, right? And I completely understand why, in particular, like, younger women do not like being hassled by their older relatives about their personal lives in that kind of way, right? And that is the primary lens I think through which a lot of liberal women see this, right? Is it's like they don't want me or you or the government or their mom spending a lot of time giving them a hard time about, like, “When are you going to get married and have kids? I want some grandkids,” right? And I get that. Like that's super obnoxious, and I think people shouldn't do that. It promotes a really counterproductive backlash.
At the same time, I think that we need to chill out, right? It's just not the case that any discussion of how it's good to support people having children, like, leads inevitably to The Handmaid's Tale. People have fewer children than they say they would like to have. They say that the main reason that they are having fewer children than they want is that economic pressures make it difficult. It's not controversial in left of center circles that we ought to do something about child care and child poverty and leave and all these other things. So it's just a question of like getting that nexus of topics out of this kind of super technocratic silo and engaging with sort of normal people who might be somewhere between incredibly keyed up feminists and in church every Sunday evangelical. Just kind of slightly mixed feelings about family traditionalism, whatever, whatever. Just like normal people, and in particular people who — I think what I say in the book is like people who have jobs rather than careers. Because often Democrats, in an elite level, there was a discussion in the primary about child care costs, which is a super important topic. And that Democrats all acknowledge is an important topic. But every single candidate who spoke about it spoke about it as a barrier to mother's ability to get ahead in the workplace. And that is like a super real thing for the kind of people who become US senators or run presidential campaigns.
There're a lot of people who it's like the opposite, right? It's like they are the security guards. So they're waiting tables, doing stuff to make money. But, like, they might want more financial support so they could spend more time with their children rather than more financial support so they can spend more time at the office. And we don't need to, like, pick one or the other of those things, but do need to be broad-minded enough to encompass that kind of whole range of aspirations and not just speak from inside the sort of silo of incredibly ambitious, highly educated professionals.
Mark: Yeah. I think we're seeing that increasingly in kind of, I guess, presidential elections and this broader point about we're seeing kind of a disconnect between some of the working class and some of the more kind of higher income earning individuals. One, I guess, slightly distinct question. Thinking about this kind of zoning, we see that Tokyo is typically held up as an example for very effective zoning. Their housing prices have not substantially increased over the last kind of few decades in part because in Tokyo, the zoning and land use regulations are controlled by the central government and basically none of the local interests have enough authority to influence it at the national level. So the zoning and land use regulations have been kept at a relatively minimal level.
We have seen in California, there's the push by Scott Wiener to a certain extent, I don't know, not nationalized but state eyes, right? Like make zoning decisions at the state level particularly along transit corridors. So what is your — I mean, you spoke previously a little bit more about kind of these rust belt cities and that don't have enough people. How optimistic are you for kind of reforms, EMB type zoning reforms in some of the more coastal cities that do seem to have much stronger agglomeration effects today than some of these kind of depopulated rust belt cities? And to what extent do changing the level at which decisions are being made play out in that?
Matt: I mean I’m fairly optimistic. People have different sort of timelines for this, but the California land usage situation got monotonically worse from 1970 to about 2015 or so. And since then it has started to get better. There have been a lot of discussions of EMB initiatives that failed, but they have also passed a bunch of stuff that has succeeded sort of around the margins. And I think there was also a learning by doing happening in that community. People have seen in the California State legislature, which ideas kind of went well and gained political support. And in Oregon and Washington, they have copied and replicated some of those ideas at a kind of more rapid pace.
The big problem is that on the East Coast we have seen nothing. Nothing good has happened in any East Coast state. And in Massachusetts, they've been tied up. I think they are going to finally pass a zoning reform that the Baker administration has been championing for years. But it's, like, pathetic. What they're talking about doing there is a state law that will say that a local government can up-zone via a majority vote rather than a two-thirds vote. And they've been, like, for years working on this, which is like — I mean it's good. I would support this law, but it's like a comically small change. And we have not seen any political entrepreneurship on the East Coast around these issues until super recently.
One good state delegate in Virginia who's been pushing on this, Ibraheem Samira, is great. But Virginia is also not like the epicenter of this problem on the East Coast at all. As already one of the more kind of house-building friendly East Coast states, because it's still a little bit of a southern state. And that's just like a question of political organizing for me. I mean, somebody needs to put on the agenda in a big way, a big change here. I mean, I think you look at the New York city mayor's race that's happening right now. And we've got a ton of candidates in, like, a huge field. A first-past-the-post primary. So somebody should run on a strong EMB. Like people might hate it, but like you could conceivably win with 25%. And, like, what's the worst that can happen? It's like, you're going to lose. But most of these people running are going lose anyway. So give it a try.
Mark: So I guess change gears a little bit, you recently left Vox, an organization you co-founded for Substack. A lot of other journalists have also, I guess, also launched a Substack. So we've seen increasingly, for example, there was the kind of op-ed in the New York Times that then was later, I don't know, rescinded. I’m not sure that's the proper terminology. But end up getting the editor-in-chief fired. So how should we interpret kind of this immediate move to Substack and broader — a little bit more broadly, kind of the future of the media and how that's going to play out?
Matt: So backing up a little bit, when we founded Vox, you start anything new and you know you have a good chance of failing, and that was fine. I totally got that. But I was absolutely convinced that if not Vox, then Buzzfeed or Vice or some other new digital startup would disrupt the big incumbent sort of media organizations and become the kind of dominant player of the future. And something that was really interesting to me was, like, let me try to co-found a place, like, shape it, like use like my ideas for what the next big thing should be. But that was wrong. Ezra Klein, my co-founder there and our sort of lead, really a visionary person, he's a New York Times columnist now. Ben Smith who is the editor-in-chief of Buzzfeed, he is also a New York Times columnist now.
So many — I think 11 Vox people, ex-Vox people now work at The Times, including like the former co-host of my podcast, or two of the people I used to co-host the podcast with, one of our best editors, things like that. So that's just different, right? Like I was really kind of like bought-in on disruption theory. And the incumbents in the media space have proven to be incredibly resilient. The New York Times is doing great. The Washington Post is doing great. CNN is like an incredibly big deal still, then Fox News for conservatives, The Wall Street Journal. And that's not what I thought was going to happen at all in the world. And to me, it changes what I’m personally most interested in doing. I got my start as a blogger. I love to tweet. I love my podcast. I like going on other people's podcasts. I don't know. I like kind of doing my own thing being an independent voice, things like that, and Substack offered an opportunity to do that. Which, in a world where I wasn't disrupting the champions or building the future of media just seemed really like cool and appealing and fun to me.
Mark: I mean one, I guess one potential kind of interpretation, even though The New York Times is still on top, it was still disrupted to a certain extent, right? They're adopting some of the playbook from Vox, Vice, Buzzfeed, much more. And then two, their kind of positioning has changed a little bit. They're becoming kind of a full-scale production company partnering with Netflix on a handful of things rather than just having this kind of singular focus on what might be described as journalism. Do you have a kind of guess, a prediction of how this might play out over the next five years?
Matt: I don't have an incredibly strong prediction. I’ve been proven wrong before, and now I’ve developed a certain number of doubts about these kinds of things. But I think that centralization and fragmentation are sort of two sides of the same coin in some ways here. That we used to have traditionally media in the United States, a really large number of sort of mid-scale organizations, right? Like lots of newspapers in different cities, things like that. And that that's going away and that we're probably going to have a small number of really giant things, and then like a million tiny things floating around.
Mark: So I guess to conclude then, are there any questions that I should have asked that I did not that you would like to answer for our listeners?
Matt: You probably should have asked me like why don't we get a billion Americans by creating charter cities?
Mark: Sure. Why don't we get a billion Americans by creating charter cities?
Matt: I don't know. Maybe we should. I was like, I had some goofier ideas that, like, didn't make it into the book. Like we should try to annex the Bahamas or build like vast charter cities in Alaska or something like that. And I now kind of regret having not put them in, because at the time I was like, “Well, like this book is too loopy already and people aren't going to take it seriously.” But I think in retrospect, it's like, there's a loopiness threshold and I was already into the loopy zone. And I might as well have just like thrown it all in there, right? It's like, why not dream big?
Mark: Yeah. I mean, I think also just everything has gotten a lot more loopy over the last three years. So when you were drafting the book, the loopiness threshold was probably much lower than it currently is. And now with like — yeah, all right. We have an insurrection with a mob invading The Capitol, and a handful of that mob actually has, like, serious plans to potentially assassinate congress members. So dreaming of charter cities in Alaska isn't as big. It's been kind of interesting.
I mean at the Charter Cities Institute, we focus primarily on emerging markets and how charter cities can help create better institutions to accelerate economic development. That being said, there has been interest in charter cities in the US. I tend to be a little bit skeptical just because thinking about, like, one, the US doesn't really have demographics. It's not urbanizing super rapidly. It's highly urbanized. Two, even assuming you get the political support for deep governance reforms, right? If you change from the US system to like, I don't know, “the idea governance system,” you're talking at most like a 50% increase in per capita incomes. But if you look at lower income countries, you're talking about 10x increases in per capita incomes. So just the implication of reforms, I don't see as high. And then three, it's like the US has a lot of very good cities already. There's a rapidly urbanizing population. You do need to build new urban centers.
I think the Alaska point is interesting in the sense that with global warming, I suspect there will be a lot of opportunities in kind of Alaska and Canada because trade routes will become shorter, with the some polar ice caps being less, I don't know, present year round. As well as with less permafrost, there will be agricultural opportunities as well as resource extraction opportunities that can kind of create a new frontier in the north that people should, I think, be taking advantage of. I did a little bit of consulting on a new city development in Kazakhstan, I think, four years back. And I was trying to tell them, like, position yourself as the gateway to Siberia. And they did not end up going with my advice. But I still think it was good advice.
And then the Caribbean point I think is also interesting. There is a grand Bahamas. It’s basically a private government in the Bahamas where they basically almost control the island. Have substantial regulatory authority. It only has like 50,000 people living there. And I’m not sure why it isn't more successful if it's — these other constraints or if they just haven't been effective at kind of this broad promotion and agglomeration effects. But I don't know, that's my overall reaction to charter city. So I'd love to see some built in the US. I’m just a little bit skeptical of their feasibility under the current regime.
Matt: Next year in Juneau.
Mark: Yep, we'll do it.
Matt: We're all coming together. No. I mean I agree with you. This is one reason I ultimately restrained myself a little bit from getting too much into this kind of thing. But I think that there's a lot of different ways to slice the salami, but they all come down to the fact that the United States of America has very low population density for the developed world. And very high living standards and I think could accommodate lots of people, while, in fact enhancing those living standards. And we should be thinking as creatively as possible about different ways to do that and breaking it down in specific terms as to — what is the issue here? Why can't we have more people in Cleveland? Why can't we have a good subway in Los Angeles? Try to delve into it rather than just accepting that like, “Well, this is how it has to be. Like we're stuck at one-sixth the population density of Germany until the end of time just because it's arid in part of the country.” Because people — I mean, you see, like, you're a smart guy. But, like, people raise all kinds of nonsense objections to this proposal if you listen to them, and I assume you see this a lot in the charter cities world. A lot of people just kind of feel that if things are a certain way, that like it just must be impossible to change them. That like all the cities that could exist already do exist. What could we do about it? And like that's not how human history has ever worked. You can do new things.
Mark: Yeah. There's definitely an inherent conservatism. I mean in some, like actors, talking to people at the multilaterals like UN, World Bank. What happens typically is I chat with them, I kind of pitch them, and they instantly go through like a dozen objections of why it couldn't work. They just look for reasons why it won't work. And I mean, there are a dozen objections to why it won't work. I mean, any kind of large-scale project is very difficult. But to me it's more interesting to think like, “Okay, how can it work? It's a long shot. But if it does, you are able to pull it off. It has a kind of very big impact.” Then two, just, I think people underestimate how much things can change in kind of five years and 10 years the scope for implementation for ideas where, I mean in the US just with Trump obviously, we've seen a substantial shift in like the Republican Party and kind of governing norms over the last over his term. And if we think about what's going to happen in the Biden term, obviously it won't be as bad in terms of governing norms. There'll be a lot of ideas on the table that were not currently on the table.
And yeah, I think I like the book. And one of the things that I guess kind of struck me reading it is beginning to kind of realize I’ve become more of an American exceptionalist in probably the past five years. I think in college, I was like, “Yeah, America's cool but it's just like has these somewhat arbitrary benefits. We're just kind of another country.” And I think the more I think about it, the more I think that there is actually kind of something special about the US in terms of how it was founded, in terms of how we've been able to integrate new immigrants, in terms of how we have been on the frontier of science and technology. Where if we're unable to really keep that place, it's not like some other country is going to displace that — is that that is something that will then be lost to the world and everything. But I think a lot of things will be worse because of that. And I think hopefully beginning to create this new hopefully cross, I don't know, ideology narrative to believe in this broad vision of the US and how to achieve it is I think a worthy cause. And I think your book is an important contribution to it.
Matt: Thank you. That's great.
Mark: Well, great. Thanks for coming on.
Matt: Thank you.
Mark: Thank you for listening to the Charter Cities podcast. For more information about this episode and our guest, to subscribe to the show, or to connect with the Charter Cities Institute, please visit chartercitiesinstitute.org. Follow us on social media. cci.city on Twitter, and Charter Cities Institute on Facebook. I’m your host, Mark Lutter, and thank you for listening to the Charter Cities podcast.