Dear Rational Optimist,
It’s time we talk about The Blight.
First coined by our friend and entrepreneur Andrew Cote, The Blight describes the ever-growing bureaucracy that’s suffocating American prosperity.
The Blight is why your health insurance costs five times what it did in 2000. It’s why our bridges and roads are crumbling. It’s why houses are unaffordable.
For my entire lifetime, The Blight’s only gotten worse. But now, we have a real chance to expose and kill it. We can uncuff innovators and restore America back to a nation that builds great things.
This is our Berlin Wall moment. When that concrete barrier fell, it unleashed an explosion of human potential. Today, we face our own wall, but it’s made of paperwork.
First, let’s look at how The Blight impoverishes us. Then we’ll discuss our duty to take advantage of our once-in-a-lifetime opportunity to fix it.
It takes longer to build a house today than it did in 1971. Did we forget how to hammer nails or pour concrete? No. We let regulations get out of control.
In San Francisco, regulations add about $400,000 to the cost of building a single apartment. $400,000! Just to get permission to build.
The shakedown starts with a $50,000 environmental impact study that often takes 18 months—longer than it took to build the Empire State Building. Then comes the mandatory neighborhood meetings at $25,000 each.
California wins the gold medal for regulatory madness. But New York, Boston, and Seattle aren't far behind. No wonder young wannabe homeowners in these cities are angry. To whom should they direct their anger?
Well, homes haven’t gotten more expensive to build. Construction costs, adjusted for inflation, have barely changed in decades. It's the regulations.
We know this because, in America, most housing regulations are local. Some places still let builders build. Take Austin, Texas. It’s green-lighting new homes faster than any major city. Rents dropped 7%+ in the past year while prices soared elsewhere.
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