In their new and highly anticipated book, Abundance, Ezra Klein and Derek Thompson, both journalists and bestselling authors who align ideologically with the political left and American liberalism, refreshingly advocate for growth and abundance. They rightly decry excessive and cumbersome regulations, which create obstacles to building, innovation, and overall progress. The authors identify our current sedentary economic and political climate as a failure of policy, culture, and government. We are thus trapped in a suboptimal equilibrium that retards growth and limits technological marvels, which is what has made the United States the wealthiest and most innovative country in the world. It’s a book written for progressives to provide them with a framework and roadmap to preserve the American project. They argue that modern American liberalism was born during the New Deal but then fractured into two distinct camps: an older contingent advocating for “growth politics” and a newer, anti-growth contingent, and that the anti-growth left has gotten it wrong.
Abundance is so ordinary to the average American that we have lost sight of its importance and how to ensure that we cultivate a growing economy for the future. This is true of both the political left and right. The book’s release coincides with the new Trump administration’s policies, many of which are anti-growth, including his reckless infatuation with tariffs (taxes), for which many economists are critical, and the “One Big Beautiful Bill Act,” which will add $3 trillion to the national debt. Trump asks girls to “have two dolls instead of 30,” which eerily resembles the claim of Bernie Sanders (a self-described socialist who ran for president in 2015) that “you don’t necessarily need a choice of 23 underarm spray deodorants or 18 different pairs of sneakers when children are hungry in this country.” The horseshoe theory of populist politics is fully realized, and it is anti-growth.
Klein and Thompson argue that this current political moment is rare in American history, when one political order makes space for a new one. They claim, “The right is abandoning many of its successes to embrace a politics of scarcity. That has left room for liberals to embrace what Republicans have abandoned: a politics of abundance.” Klein and Thompson then go on to address “the pathologies of the left” that thwart abundance.
The authors open with an account of the year 2050. Solar panels provide the energy to cool your home, complementing power from wind turbines, nuclear power, and geothermal wells, and the cost is a fraction of your former energy bill. Water from the ocean pours out of the faucet. The produce in your refrigerator is local, the chicken you eat is grown in cellular meat facilities, and crops grow vertically in tall greenhouses. Drones drop off your medication. The air is clean and cars are electric. AI transforms life, poverty is reduced, and the workweek is shorter. In 2050, we are, according to Klein and Thompson, “beyond scarcity” and have achieved a world where the housing, climate, political, and financial crises that marred the start of the 21st century are gone.
This vignette illustrates their vision of abundance and high standards of living: better and more affordable clean energy, improved and more accessible housing, advanced technology, and science infrastructure that supports risk-taking and is no longer hindered by cumbersome regulations and bureaucracy, as well as better access to life-changing healthcare. They spend a great deal of time in the rest of the book arguing about how progressives have gotten healthcare, housing, climate change, and science wrong and then offer solutions.
It should be noted that this vision of the future differs wildly from American life 50 years ago and is unrecognizable from 250 years ago, points which are illustrated throughout the book. Before 1750, no country had experienced sustained economic growth. In 1850, no country had a life expectancy higher than 40 years. Today, the global average life expectancy exceeds 70 years, and in the United States, it is nearly 80 years. In 1940, Henry Ford, who transformed the automobile industry, predicted that one day we would have a “plane car.” We may not have flying cars yet, but the authors point out that, in 1800, it took a month and a half to travel from New York to Chicago. By 1830, the journey had been reduced to three weeks. By 1850, it had been cut to two days. Today, it takes only three hours.
Needless to say, the authors are optimistic about the future and believe we can achieve more abundance. Agreed. And their best chapter addresses housing, where they acutely diagnose the problem as one of supply. Progressives have so overregulated housing in cities like San Francisco that they have effectively outlawed cheap and affordable accommodations. For example, zoning laws have led to a decline in boarding houses in the U.S., which were once common in the 19th and early 20th centuries, driven by the NIMBY (Not in My Backyard) movement and a culture of political weaponization.
Klein and Thompson point to California as a whole as an example of what has gone catastrophically wrong with liberal politics. A state with 12% of the nation’s population, 30% of its homeless population (no permanent residence), and 50% of its unsheltered population (sleeping on the streets). California is a beautiful state with an incredible climate. Then the 1970s happened, and city planners became a tool to enforce NIMBY preferences and relished their technocratic authority of urban political prohibitionism. What emerged were housing and building codes, minimum parking requirements, lot-size requirements, and maximum residency limits, all of which made it more expensive to build and own homes.
Economist John Cochrane argues that all regulations are designed to limit growth, so we should be careful what we ask for. Moreover, regulations beget more regulations—essentially, we’re tripping over ourselves, restricted by barriers enacted in the past. While Klein and Thompson don’t address this, progressives are also known for championing rent control, which reduces the long-run supply of affordable housing. Unintended consequences help explain the resulting dystopian hellscape in housing. The good news, however, is that the YIMBY (Yes in My Backyard) movement, which emerged in the San Francisco Bay area in response to the affordable-housing crisis, has gained traction.
My biggest issue with the book is that the authors address economic problems but are not themselves economists. They’re making a political argument in service of the progressive project rather than making a principled argument that rests first on economic realities and then determining the best political course of action.
They do, at times, reflect on incentives, which always matter, and unintended consequences, but the heart of their argument is one of state capacity. They want smart regulations that foster more building. They see infrastructure projects as productive and praise President Biden’s infrastructure bills, the largest since the 1950s, disregarding the inevitable boondoggles. They often criticize Republicans for trying to make government less efficient. Yet the core economic question both parties should confront is this: What are the essential functions of government, and how can we limit it to those, leaving the rest to the market and civil society? Answering this requires that we understand and deploy the economic way of thinking.
Again, Klein and Thompson are not economists but well-meaning technocrats. For example, they praise the environmental laws that date back to Richard Nixon but never challenge the assumptions about climate change. Before debating solutions, we need to ask: What do we mean by climate change, and how serious is the threat? Scientific debate exists about the implications of climate change, including its pace, regional effects, severity, and appropriate responses. These questions beg for cost-benefit analyses. Moreover, Americans are skeptical about the climate crisis and what should be done about it, which matters—because taxpayers are footing the bill.
Taxpayers also approach scientific research and healthcare issues with the same reservations. The authors’ view is that the government has important roles to play in funding and working in these sectors, and they admonish Republicans and Libertarians for questioning this. They favor subsidies for the “right” things but don’t consider the costs or the political rent-seeking that inevitably emerges. They are straightforward about their skepticism of leaving too much to the market. Yet the book doesn’t get down to brass tacks. How will better technocratic planning lead to better outcomes this time?
For example, they applaud what the U.S. was able to accomplish during COVID-19 with Operation Warp Speed—but wasn’t this a case of government halting burdensome regulations and getting out of the way? The authors also fail to mention the apocalyptic mistake of shutting down the economy, which resulted in the largest decline in GDP in U.S. history. Klein and Thompson claim to be outcomes-focused. Economists are outcome-focused, too, but they think in terms of outcomes based on supply and demand, adjudicated by comparative advantage and the rule of law. Sometimes simply letting the market work is the answer.
The authors also worry about stultified scientific research and innovation, demonstrating that the government tends to reward low-risk research and doesn’t fund high-risk research, which is often where discoveries lie. They argue that if we continue to restrict immigration and international students, we will further compromise cutting-edge innovation and discovery. There is much to agree with here, yet they argue that this requires reworking the National Institutes of Health (NIH) rather than asking, How much of this can be left to the market, and how much must be done by the state? Moreover, they hail Medicare and Medicaid as examples of innovation, which is laughable. These are failed government healthcare programs and our largest unfunded liabilities outside of Social Security.
Finally, the most important economic question is never addressed: How much will all this cost? The U.S. national debt currently stands at $36 trillion and is continuing to rise. Wall Street is worried, and interest payments on the national debt exceed $1 trillion annually. The authors advocate for increased housing, green energy, transportation, technological innovation, and healthcare. The debate lies in how we accomplish this. They want to live in a world where there are more marvels, a point that should elicit universal agreement.
But here’s the rub. Klein and Thompson truly reveal their hand in the book’s conclusion when they invoke the Marxist critique of capitalism. They argue: “Marx’s aim was not to turn the production machine off, but to direct its ends toward a shared abundance: to unburden the forces of production and make possible that which had been impossible to imagine. There is much he got wrong, but one need not be a communist to see the wisdom in this analysis.” So much for the economic way of thinking.
A healthy dose of Hayek is warranted here when he warned, “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” The perfectly designed housing industry, scientific innovation, cutting-edge technology, and healthcare industry do not exist. Economics is about understanding emergent orders and marveling at marvels. More abundance requires that we provide the framework for unleashing human creativity, humility about what we can accomplish, and respect for costs and unintended consequences. We can all agree that an abundance agenda is necessary, degrowth is pernicious, and actual progress lies not in central planning but in cultivating the conditions for decentralized innovation and individual freedom that have always driven human flourishing.
It’s what we disagree about that’s the challenge.
