"Abundance" is a Soviet Five-Year Plan
Chapter Three: Govern
In March 2025, New York Times opinion columnist Ezra Klein and Atlantic staff writer Derek Thompson published their #1 NYT Bestseller Abundance. This essay is the fourth of seven that evaluates the book’s premises and prescriptions for facts, fallacies and falsehood. This installment will focus on Chapter Three, Govern.
Like the cause of economic growth and building were not discussed in the chapters titled Grow and Build, the nature of government and the features of good governance are not mentioned here. Instead, it is reminiscent of the infamous Soviet Five-Year plans. The broad outline of Soviet economic policy was 1) Industrialization to boost national income (grow); 2) Collectivization to increase state control of production (build); and 3) Economic self-sufficiency throughout society.
In fact, the first half of chapter three mentions “affordable housing” twenty-two times. But as are their wont, Klein and Thompson do not define “affordable” and do not identify the causes of what they call a “housing crisis.” They don’t know. But treating people like herd animals in need of pen or stall is also reminiscent of George Orwell’s Animal Farm.
However, they do say this about the “humanitarians: “That sounds good” and “Every one of these is a worthy goal” and “Each individual decision is rational” and “Many of these are good goals” and “Worthwhile goals” and “Lawmakers often have good intentions.”
Sounds good and worthy according to whom? By what standard? Not only are theory and practice out of synch here, so are facts and values. At the same time, three important subjects are being addressed: 1) The homelessness epidemic is certain cities; 2) The sharply increased cost of houses and apartments; and 3) The sharply increased price of mortgage loans.
Naturally, with any good or service subject to complex regulations, there is a supply problem. And as before, I will divide my analysis into themes: Economics, History, Ethics and Reality.
Economics
Chapter three includes some bad economic premises and facts, but there are also good economic ideas that need to be supported and bad economic policies that Klein and Thompson acknowledge:
The bad economics that is promoted:
“The public has interest in fostering a strong and vibrant network of small and very small micro businesses.”
“Shouldn’t things happen faster if they are backed by the might and money of the government?”
“Neither side focuses on what scholars call “state capacity”: the ability of the state to achieve its goals.”
“Across Europe, government administered health-care systems negotiate down the prices of drugs and treatments.”
The good economics that are supported:
“Public money layers on requirements, delays, and additional goals, slowing down construction and raising costs.”
“All of this money is going to feed the beast of covering the costs of regulations.”
“Grant makers want to show donors that their money is being used well, and the only way to prove that is through audits.”
“I took calculated risks that I’d have not taken in a normal project . . . We have taken discretion and judgment away.”
And the bad economics that are acknowledged:
“Liberals lament that private developers want to build profitable developments.”
“Process is enthusiastically added but seldom lifted.”
“It is done by external firms chosen and managed through a labyrinth procurement process.”
“There was more fraud in the perfect applications.”
It bears repeating, economics is about cause and effect. Production creates wealth. Wealth creates demand. Supply lowers prices. Markets create information. Markets reward efficiency. Efficiency creates profit. Profit attracts capital. Capital finds talent. Talent obeys reality.
So, how does Abundance solve the contradictions in the list above? It’s a clever trick. For homelessness and home affordability, they cite the greater economic freedom of Houston’s zoning laws. For the housing supply shortage, they cite the authoritarian culture of Singapore that demands personal responsibility and home ownership. And for free market solutions for America, they offer to fix the failures of California high speed rail and the 2022 CHIPS and Science Act of the Biden administration. Trust us, they say.
History
In the second installment of this series, I referenced a radically profound book by a female author that was published in 1943: The God of the Machine by Isabel Paterson. And in the third chapter of Abundance, I stumbled across a passage that evokes another radically profound book by a female author that was published in 1943,
To try to neutralize local attacks, developers hire pricey architects, redo plans repeatedly, make all kinds of aesthetic and architectural concessions or additions, hire extra lawyers and auditors, and on and on. Even if a project does survive all, it does so at a higher per-unit cost.
Almost exactly, this describes the Cortlandt Homes project in The Fountainhead by Ayn Rand. The only significant difference is the original architect who solved the affordable housing problem: he did so by virtue of his genius and for no compensation other than the pride he earned from thinking, doing and creating. Not the inhumanity of humanitarianism described by Paterson, “because that was not their objective.”
Ethics
The subject of epidemic homelessness is typically framed as an ethical issue with economic causes. That is false. Certainly, ethics plays a major role in what to do about it, but the ethical system that causes the problem is routinely ignored and capitalism is always the scapegoat. Ask any Soviet propagandist.
Klein and Thompson’s book is also prime example, “the cause of the homelessness isn’t the poverty or the addiction or the unemployment.” But if Abundance claims it is not poverty, addiction or unemployment, then homelessness must have something to do with poverty, addiction and unemployment.
Clearly, homelessness has an almost perfect correlation with poverty and to dispute the causal relationship is absurd. Regarding unemployment, that discussion must center on relatively healthy adults who are honestly pursuing work opportunities. But honesty as the virtue that never fakes reality is off the table in a book that fakes reality.
As for addiction, that is largely a personal choice that typically begins with weak self-esteem and strong social reinforcement. In fact, addiction may be the most difficult to solve, but that is because one of the primary contributors is never discussed: progressive government schools.
More specifically, the dogmas of 1) Determinism that claims your ideas and actions are programmed by your genetics or environment; 2) Collectivism that claims your life belongs to your ethnic group and society; 3) Guilt that claims your tribe has oppressed some protected group and owe a duty to those in need; and 4) Authority that claims you are not capable of self-ownership and self-determination.
Private education focused on the power of the mind to comprehend reality, the power of the individual to become independent, and the virtue of pride to enjoy a world that is orderly and elegant is the place to start.
Reality
Fortunately, chapter three offers some first steps toward solving the problems of homelessness, the high cost of houses and apartments, and the high cost of mortgage financing. Not the methods, but the ideas that lead to solutions that have been present since 1776 – and obvious to anyone who prizes rights, liberty and justice:
1. “Contractors that have grown in size and revenue precisely because they are good at delivering projects on time and under budget.”
2. “Houston has no zoning rules at all, though it does have some land use regulations.”
3. “Liberalism has become obsessed with procedure rather than outcomes.”
4. “Managers of every component of the project were empowered to be decisive, take ownership and make a call when necessary.”
Essentially, the solutions are driven by individuals free of government intervention, who trade voluntarily for their own profit, and in a society where governance is the defense of property rights. To learn more, please click The Moneyball Method.