Marc Dunkelman has a new book coming out next month called Why Nothing Works. His thesis is that America once did big things but now seems stuck—and much of it is the fault of progressives:
America is today the victim of a vetocracy that allows nearly anyone to stifle progress. While conservatives deserve some blame, progressives have overlooked an unlikely culprit: their own fears of “The Establishment.” A half-century ago, progressivism’s designs on getting stuff done were eclipsed by a desire to box in government.
This has become such a common critique that it's now practically conventional wisdom. But before we accept it, we need to know at least two things:
- Do we, in fact, not build things these days?
- Have all those progressive regulations been effective, or just pointless obstruction?
I'm going to try to assess both of those things as honestly as possible. What follows, I'm afraid, is immensely long. I got carried away. But the charts are all super simple and you should be able to scroll through them fairly quickly. Let's start with various categories of construction.
Total Construction
There are two ways of looking at construction: (a) total dollars adjusted for inflation or (b) as a percent of GDP.
In simple dollar terms, construction spending has grown steadily over the past 30 years. As a percent of GDP, it recovered from the Great Recession a few years ago and is now back to its pre-bubble average. Any way you look at it, we're building a lot of stuff.
But spending is a troublesome metric. If it's going up, does that mean we're building more stuff, or does it only mean that stuff has gotten more expensive? To answer that, we need to look at raw amounts of different kinds of construction.
Housing
Once again, there are two ways of looking at this: (a) the absolute number of units approved and built, and (b) the number of units after adjusting for population. The former gives a sense of whether the raw permitting process is working, while the latter tells us if we're building as many houses as we want to.
The top chart shows the number of housing units that managed to get built. It's gone up and down with the housing market and is about average today. The bottom chart is my favored metric: the number of units added each year as a ratio of the population increase each year. By that metric, residential building was fairly flattish up through the Great Recession and has since surged to historically high levels. Despite everything, we're still building a lot of housing.
Roads
When the interstate highway system was finished, the federal government naturally wound down its road-building program. Nonetheless, looking at all levels of government, road building has steadily increased over the past 40 years.
There's a dip during the pandemic, but it's already partly recovered. We're building a lot of roads.
Utility Solar
Big solar projects are infamous for their long permitting times, often due to opposition from environmental groups. Nonetheless, the construction of utility solar plants has skyrocketed:
I'd like to see this in acres of land used, but I couldn't find that. But this is a good proxy. One way or another, despite the opposition, we're building a lot of big solar plants.
Or so it seems. But the only way to know if this construction rate is impressive is to compare ourselves to the rest of the world. Since the US is a big country it naturally has a lot of solar capacity on an absolute level, which means it needs to be adjusted for population.
Among countries with more than 2 GW of solar capacity, the US is #3 in watts per capita. We're building a lot of utility solar.
Pipelines
Opposition to pipelines gets a lot of press, but that's limited to a few very high-profile projects. Here's how we're doing overall on pipeline construction.
Even averaged over five years this is a very volatile series. Still, it's been pretty steady over the years. We're building about the same pipeline mileage today as we did 40 years ago.
Bridges
We build thousands of bridges every year. However, most of them are tiny overpasses that are only technically bridges. For this chart I extracted just the bridges over a thousand feet long.
There has been a decline since 2016, but the overall trend is steadily upward. We're still building a lot of bridges.
Summary: total construction is up; housing is up; road building is up; utility solar is up; pipelines are flat; and bridge building is up. Given this, it doesn't appear that the progressive regulatory environment has slowed us down much—if at all. Still, there are a lot of regulations on the books these days. Let's take a whirlwind tour of whether they've been effective
What's the impact of all the regulations we've put in place?
Even if we're still building a lot of stuff, that doesn't mean regulation is good. After all, it obviously slows things down at least somewhat. It's only worthwhile if the cost (in amount of construction) is modest and the benefit (in human prosperity) is high. So let's look at the benefits of regulation.
The EPA has a lot of rules about what and where you can build things. Here's the impact of all those rules on air pollution and water pollution.
Air pollution levels are down substantially for all types of pollutants. Water pollution turns out to be surprisingly hard to measure, but two overall measures—safe for fishing and safe for drinking—both show huge improvements since the Clean Water Act was passed.
But that's not all the EPA has done for us. They've also had a huge impact on the crime rate by eliminating lead in gasoline.
The FAA is another big producer of rules. But it's paid off.
The NHTSA is a busy beaver at producing safety regulations for cars. Because of this, a lot fewer of us die every year.
You've probably heard that the Hoover Dam took only five years to build. Why can't we do that anymore?
Part of the reason is that a hundred workers died during its construction, something we no longer tolerate. Nor is this just ancient history. Construction of the original World Trade Center took 60 lives. By contrast, its replacement, One World Trade, was built with zero loss of lives.
A lot of this is due to OSHA, which comes in for a lot of abuse over their seemingly arcane rules to protect workers. But OSHA has been around since 1934 and was given greater power (and its current name) in 1970. The impact has been substantial.
Workplace injuries are also way down.
This is not all due to OSHA, of course. Labor unions have also played a big role in pushing for safer workplaces.
How about banking regulations, which take up miles of paper from an alphabet soup of federal regulators? Banks may hate them, but they're good for the industry regardless.
After banks were regulated in 1934, failures plummeted and stayed low for 40 years. When S&Ls were deregulated, failures surged. And when derivatives were set free in 1999, within a few years they were adding rocket fuel to the Great Recession. But even when regulation was tight, bank profits have stayed strong. They aren't being hurt too badly.
It's not just banks, either. The Federal Reserve is responsible for making the entire economy safer.
After World War II the Fed began to take Keynes seriously and pushed back against cyclical booms and busts. The results have been pretty spectacular. Even the Great Recession produced only a tiny blip compared to half a dozen recessions and bank panics before the war.
How about the FDA? It was formed in 1906 alongside the Pure Food and Drug Act. Over the next half century salmonella food poisoning dropped to nearly nothing.
Public health regulations have an equally impressive track record.
In the Trump era the entire framework of civil rights and DEI has come under blistering attack. And maybe some things have gone too far. At the same time, the focus on civil rights from the Justice Department and the EEOC has paid off. Here's the share of managers and executives in private industry who are Black.
Governments are notorious for the failure of big software projects. And there have been some doozies. The project to upgrade air traffic control is infamous. The effort by the IRS to eliminate paperwork has gone on for years with no perceptible results. And remember the rollout of Obamacare?
There really are some bad IT projects out there—although it's worth remembering that Obamacare was up and running smoothly within a month of its initial failure. It's also the case that while the big failures get a lot of attention, they represent only a tiny portion of all projects. Here, for example, is an estimate of the status of all current federal IT projects.
I don't know how seriously I would take these self-reported figures, but even if they're optimistic they still suggest that we can build software just fine. Even a 10-15% failure rate wouldn't be very bad.
Also worth noting: the exact same thing happens in private industry. Big software projects blow up constantly. The difference is that they don't have inspector generals who snoop around and then write public reports about the failures. It's only government failures that produce dramatic congressional hearings and endless claims that "the government" can't do anything.
Building codes have gotten more and more intrusive over the years, but that's paid off too.
Finally, one more chart that's a bit of an oddball. It's about NEPA, the National Environmental Policy Act. It requires government agencies to write environment impact statements for large projects and to conduct public hearings about them. These EIS statements have gotten longer and more complicated since NEPA was founded in 1970, mostly because environmental groups have gotten more litigious.
But the production of an EIS is required for only a tiny fraction of the biggest projects, less than 1% in all. The rest either require a simpler Environmental Assessment or are simply cleared through as exempt. Here's the litigation rate of NEPA decisions.
Note the left-hand column. It's in tenths of a percent. And the litigation rate is going down.
(For some reason, the CEQ kept litigation figures for 2001-13 but not before or after. So this is all we have.)
Once again, the big lawsuits over controversial projects are the ones you hear about. But there are thousands of other projects that go through the planning process fairly smoothly and without any lawsuits.
But still, is NEPA worth it? That's a judgment call, and there's no chart I can show you about that. However, there's a mountain of anecdotal evidence that NEPA has improved the environment; given low-income communities a bigger voice in what's built nearby; and has often improved projects by forcing builders to plan more diligently before they start to build.
In Summary . . .
There are plenty of regulations that could use some pruning. But overall, the evidence is fairly clear that (a) we're still building a lot of stuff, and (b) a lot of regulations are there for good reasons even if they slow things down.
I'd also like to remind you of three axioms to keep front of mind whenever you hear that we can't do anything anymore:
- When the interstate highway system was finished, we didn't build a lot of highways anymore. When all the big rivers had been dammed, we stopped building big dams. After putting up several dozen skyscrapers over a thousand feet tall, developers realized that extreme height wasn't especially profitable and built a lot fewer of them.¹ In short, when all the big stuff has been built, you don't build anymore. That's common sense, not a loss of vision.
- Always remember that California and New York City are outliers when it comes to building. And within California, the Bay Area is simply insane. Californians genuinely resist further growth, and construction in NYC is genuinely eye-poppingly expensive. When you read about our ability to build stuff, always be suspicious if the examples are all from San Francisco, Los Angeles, and New York. They aren't representative of the country.
- The fact that you've heard of something is almost a guarantee that it's unusual. Nobody writes a newspaper article headlined "New light rail project coming along normally." So while it's true, for example, that California's high-speed rail project borders on the absurd; New York's water tunnel #3 will take 60 years and $6 billion to complete; and a project to create a virtual border fence failed, then its successor failed, and then its successor failed—the fact that you've heard of these things is because they're epic fumbles. It doesn't mean that government is incompetent any more than New Coke means the Coca Cola Company is incompetent.
It shouldn't be necessary at this point to mention that of course there are some burdensome regulations out there. NEPA should probably be modernized, the Pentagon needs to fix its acquisition process, and our price support system for farmers is just short of insane.
But be careful before you declare a regulation pointless. Do we really need dozens of pages of rules about the sinks in restaurant bathrooms? It might seem silly until you realize that it's mostly to make them accessible to the disabled. If you still don't think it's worth it, that's fine. But you should at least know why the regulation is there and what it's accomplished.
¹In Europe they never built them in the first place. Outside of Russia, there are only two buildings over a thousand feet on the entire continent. Australia also has two, Africa has one, and South America has none. Asia has 176.
