The Suburbs Are Safe -- for Now

The Trump Administration has  announced that it's repealed the radical Obama-era institution of the so-called Affirmatively Furthering Fair Housing (AFFH) policy, after receiving thousands of complaints from around the country that the plan would radically change the nature of America's suburbs. "The suburb destruction will end with us,” President Trump stated.

This long expected and overdue repeal will allow the president to use the inflammatory issue of keeping federal control and divisive mandates out of and away from the nation's suburbs in his campaign. The issue is critical for appealing to suburban voters who constitute a majority of Americans, and who oppose nationalizing housing policy by Washington, D.C.

This move comes on the heels of the announcement by the Democratic presidential campaign of Joe Biden (“Obama 3”), that, if elected, he would aggressively implement AFFH, to force middle and upper middle class suburban communities to house, educate, and subsidize the poor.

The now-repealed 2015 Obama iteration of AFFH claimed that the federal government could use HUD’s community block grants to force suburbs to provide high density, low income, and Section 8 housing despite local zoning laws. That is, it gutted the right of communities to determine their own zoning policies, and thereby threatened to destroy the nature and property values of thousands of suburbs across the country. This policy rests on a radical departure in the definition of "fair housing." Prior to the Obama Administration, the term had always meant "no housing discrimination based on race or creed." 

The stated intent of the original 1968 Fair Housing Act was to defeat de facto segregation, by opening up the nation’s housing supply to anyone who could afford property. Obama’s radical socialist HUD Secretary, Julian Castro, chose to redefine "fair' to include economic status, and to compel local authorities to change zoning laws to force communities that typically lack public transportation, infrastructure, needed academic programs in schools, and even suitable jobs, to provide those things, along with the higher density Section 8 housing -- as if not having all of the above was a sign of active racial and economic discrimination.

The Trump Administration, which has been aggressive about removing unhelpful regulations from the books, noted that the Democrats' implementation of AFFH would have imposed a massive regulatory burden on localities, required high density zoning, eliminated single family zoning, and destroyed our suburbs.

The White House pointed out that the majority of African Americans, Hispanics, and Asian Americans now live in suburban communities, where they, like so many other Americans, are able to afford homes, achieving one important part of the American dream. And that home ownership “offers the chance for all Americans to build wealth for their families.”

The point about home ownership being a basis for building wealth is an important rejoinder to the critique of those who believe in "structural racism” that African Americans are somehow denied the ability to create inter-generational wealth. To be sure, that requires both actual ownership and a stable community, in which the value of property appreciates over time. Introducing mandatory Section 8 housing has generally reduced the value of adjacent properties while also raising the rates of crime that many homeowners fled the cities to escape in the first place.

As for the Obama-era regulatory interpretation, HUD noted that:

This approach is not required by applicable statutes, which give HUD considerable discretion in determining what “affirmatively furthering fair housing” means, and it is also at odds with both federalism principles and specific statutes protecting local control over housing policy. For example, Congress specifically barred HUD from using funding to force grantees to change any public policy, regulation, or law.

HUD Secretary Ben Carson said,

After reviewing thousands of comments on the proposed changes to the Affirmatively Furthering Fair Housing (AFFH) regulation, we found it to be unworkable and ultimately a waste of time for localities to comply with, too often resulting in funds being steered away from communities that need them most. Instead, the Trump Administration has established programs like Opportunity Zones that are driving billions of dollars of capital into underserved communities where affordable housing exists, but opportunity does not. Programs like this …. allow communities to focus more of their time working with Opportunity Zone partners to revitalize their communities so upward mobility, improved housing, and home ownership is within reach for more people. Washington has no business dictating what is best to meet your local community’s unique needs.

Because this is all a matter of regulation, not law, it would be entirely possible for a Biden Administration to revive the Obama interpretation, and return to actively urbanizing and, consequently, destroying the suburbs. That is what they have promised to do in their statements on housing policy. As we approach November, that fact should be and widely publicized by the administration -- widely understood by American voters.

Design for Living, Badly

Since the end of the Cold War, the world’s governments have been engaged in a vast collective enterprise under the aegis of the United Nations and with the guidance of the Intergovernmental Panel on Climate Change to reduce the rise in global temperature, aka global warming, aka climate change. That reduction has changed over time. Until 2010 the aim was to cut the rise to 2.0 degrees above . . . well, above what?  

The answer is an odd one: the target was to hold the rise to 2.0 degrees above the global temperatures prevailing before the world began to industrialize.  

But as Rupert Darwall points out in his new monograph, The Climate Noose: Business, Net Zero, and the IPCC’s Anti-Capitalism (Global Warming Policy Foundation, London), there didn’t seem to be any solid scientific foundation for choosing that target: early 20th-Century warming between 1910 and 1945 had occurred before anthropogenic carbon emissions could have had a major impact on global temperature. So why choose that starting point? 

Darwall concludes that the 2.0 degree target was prompted by what he calls “the foundational tenet of environmentalist ideology: that the Industrial Revolution constitutes the original sin of modern civilization.” And that suspicion is supported by other oddities that he uncovers during his summary of how global warming policy has developed since 1989.  

For instance, the UN Framework on Climate Change was signed in 1992 with the aim of reducing carbon emissions. In the twenty-two years from then to 2016, carbon emissions (from fossil fuel burning and cement manufacture) actually rose faster than before—namely, by 61 per cent compared to 50 per cent in the period 1970 to 1992.  Was this because the capitalist West was pumping out greenhouse gases? Everyone from the UN Secretary-General to the Pope would like you to think so. But that’s not remotely the case. Darwall is fond of unveiling inconvenient facts and here is one of his best: 

1981 was the last year when the West’s carbon dioxide emissions exceeded those of the rest of the world. By 1989 and the fall of the Berlin Wall, the West’s emissions were 46% of global emissions. Before the pandemic struck, they accounted for around 25%.

Developing countries now emit three times the emissions of the advanced West.  

Sky's the limit.

That shouldn’t surprise us too much because it’s a firm principle of climatist ideology, not to mention a firm policy commitment of Third World governments, that developing countries should not agree to be bound by any limits on their industrial development and use of carbon-based energies. When attempts were made to get the developing world to accept such limits at the 2010 Copenhagen conference, China, India, Brazil and others rebelled and the conference ended in obvious failure.  

The response of the IPCC, the European Union, and the Obama administration was to relaunch the international climate policy process in a way typical of global bodies. They adopted a far tougher target for carbon emissions reduction—namely, one of a 1.5 degree rise in temperature since industrialization—but left the task of meeting the targets to national governments while proposing a raft of  reforms to make it possible. The 2018 IPCC report described these reforms as “very ambitious, internationally cooperative policy environments that transform both supply and demand" or, more succinctly, as “intentional societal transformation.”  

And, of course, they reveal the dirty little secret of UN environmentalism—it's a program for economic redistribution from the West to the developing world almost as much as for climate change mitigation. Since foreign aid has been intellectually discredited in recent years, the climate change process now has to take up the slack. But the economic consequences of imposing these reforms—as coyly hinted at in the dead bureaucratic language of the IPCC reports—are so savage in their impact on the poor that no amount of capital transfers from the West would compensate for them.  

There were some very large and gaping loopholes in this strategy, as there always have been in IPCC reports, to enable governments to evade, postpone, and “forget” the commitments they accept in such agreements. Realistically, such loopholes have to be there—or the entire U.N. Framework would collapse. The developing world has never accepted that the 1.5 percent restraints apply to itself in the first place; the U.S. under Trump has rejected them (while actually achieving larger emissions cuts than any other country because it has permitted fracking); and the EU and most of its member states outside Central Europe have adopted them hypocritically in the knowledge that they can’t possibly be achieved without a global recession worse than any in history (including what might emerge from the coronavirus pandemic.)

Incredibly, some Western governments—notably, U.K. governments under Gordon Brown, David Cameron, Theresa May, and now Boris Johnson—have gone beyond the IPCC recommendations and committed themselves to net-zero emissions by 2050. Barring some amazing technological breakthrough that target cannot be achieved, but it can cause enormous economic damage in the course of failing and being abandoned.  

What then will happen? One of the academic architects of the 1.5 target initially said it was “incompatible with democracy” -- i.e., that the voters would never stand for it. His judgment is confirmed by the fact that whenever the voters in the U.S. or Australia have been given the chance to vote down carbon taxes, they have taken it enthusiastically. The sceptic was persuaded to amend his judgment to say that implementing the target would merely be “very hard” after a discussion with the headmaster, but his first thoughts were correct. Exactly how “hard” it would be to sell the IPCC formula is somewhat speculative because, tellingly, both the IPCC and sympathetic Western governments refuse to conduct cost-benefit analyses of the commitment.  

Mr. Darwall’s own attempts to construct one from the scattered information in the reports is devastating. Whatever the assumptions, it seems, the costs vastly outweigh the benefits, and the impact on everyone, especially the poor, will be to increase their energy and food costs, to reduce their standard of living overall, and to destroy any prospect of improvement in their lives 

Poor, but Green.

And because governments cannot promise credibly to deliver either the 1.5 or net zero targets if the voters stop them, the UN and Green campaigners have turned to another partner: namely business. Indeed, the recruitment of Wall Street and industry to the cause of promoting a carbon-free economy is the central and the most novel part of his argument. He shows how leading figures in Wall Street and central banks, such as Michael Bloomberg and Mark Carney, have suddenly discovered that capitalist corporations should abandon shareholder sovereignty and profitability as the main engines of their activity and instead seek wider social objectives, above all "saving the planet," in partnership with a wider range of stakeholders. Nor do they merely make this argument, they are designing financial incentives to penalize companies engaged in lawful and socially necessary activities such as mining or oil and gas exploration by obstructing their access to capital investment. And they seek changes in the law to encourage corporate giving to “Green” causes irrespective of its impact on shareholder value. 

I’ve written on this theme myself on The Pipeline here and here. It is becoming a cause for concern more broadly. Andrew Stuttaford, an old friend, recently wrote powerfully on the dangers of this misnamed corporate social responsibility on NRO. In effect, it gives corporate managers the power to tax their shareholders to spend that revenue on political causes of which the shareholders themselves might not approve.  

Taxing is rightly regarded as a government monopoly in democratic regimes, and we call those rulers who divert public money into their own bank accounts “kleptocrats.” We should be very wary of the idea that Michael Bloomberg is gifted with special insight into what the voters want, given that he recently spent half a billion dollars of his own money to get nothing whatever in the Democratic primaries. Who knows what he might not achieve with ours? Kleptocracies are not improved by being private rather than public.  

Unless the spread of corpocrats buying virtue with our cheque books is restrained, the victims will not only be their shareholders and people whose security rests on pensions invested with them. They will include capitalism itself. For, as Darwall argues brilliantly, in seeking to transform capitalist companies into charities that may also make a profit (with luck), the new green capitalists would unconsciously ensure that companies (and entrepreneurs) would no longer be moved by the constant incentive of profitability to innovate and compete. Indeed, it is that very incentive to innovate that the IPCC and the principal ideologists of environmentalism dislike so much. They want a stable, even a declining, world that consumes less and less. Their plans honestly include a series of restraints and obstacles to enterprise, innovation, and growth.

If they were also able to replace the animal spirits of capitalism with the protective mentality of the bureaucrat, they would make companies into agents of economic and social stagnation and in time decay. In short, what the Bloombergs, Carneys, and corporate responsibility hucksters want would lead to a result they almost certainly don’t want. They want capitalism to commit suicide in order to save the world from the growing pains of prosperity.  But we know that the world before capitalism, like the world outside capitalism before 1989, was one of stagnation, decay, poverty, tyrannies, limited horizons, zero net hope.  

The international implications of that I’ll return to next week.  Meanwhile, read on:

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