While Bill McKibben and Daryl Hannah were getting hauled away in handcuffs in protest of the Obama administration’s decision to approve the Keystone XL pipeline, that same administration was quietly fixing the problem.  I don’t have an informed opinion about the pipeline, except that it’s clearly a symptom of our addiction to fossil energy and not the cause. When you start digging down to the root causes of our dependence on oil, gas, and coal, you will find government-subsidized suburban sprawl. Though curbing sprawl won’t end our addiction to cheap oil, stabilize the climate, or pull us out of the Great Recession, it is the best chance we’ve got, and the Obama administration just took a step toward making it possible. 

I’m not going to make the argument that more compact cities are better for the planet, create jobs, make people happier, etc., because many many people, including Dave Roberts, have done it already.  Sensible progressives and environmentalists have been railing against sprawl for decades, and in some places, even had small successes in moderating it.  However, it’s been an uphill battle, because the economy of the built environment is skewed toward sprawl, and fighting it is every bit as satisfying and effective as swimming up a waterfall.  What I will do is highlight the massive, Keystone XL-dwarfing importance of . . . wait for it . . . a potential shift in home mortgage underwriting guidelines that takes transportation costs into account.  

I know, not as sexy as Bill McKibben in handcuffs, but way more important.  Here’s why: 

Buying a house is hugely subsidized by the US government.  If we’re not in a massively inflated housing bubble, this subsidy makes buying a house into one of the safest and highest yielding investments possible. Therefore, everyone wants to buy a house. Houses cost less well outside the urban center. This is primarily because raw land is much cheaper where there are no jobs, urban services, or infrastructure.  Construction costs might also be slightly lower, and there are frequently fewer regulations, fees, and taxes, which bring down the total cost.

If I want to get a piece of Uncle Sam’s largesse, and I make a moderate salary, I have to drive ’til I qualify i.e. look farther and farther from the urban center.  This is because when I apply for a mortgage, the bank only looks at the monthly payment and my salary.  They assume that if I only spend 30% of my income on my mortgage payment, I’ll be able to pay off the loan — location doesn’t matter. However, if I live in the outer ‘burbs, my family will need at least two cars, and might spend as much on transportation as on housing. That’s not counting the massive headaches and wasted time from getting stuck in traffic, but the bank does not count transportation cost when they write the mortgage.

The bank doesn’t care about my transportation cost because Fannie Mae and Freddie Mac, the government sponsored agencies that buys or guarantees the majority of the mortgages in this country don’t care. Despite the fact that my family could easily as much on transportation as on the mortgage payment, that cost is not included in their qualifying guidelines. If we started calculated the cost of car ownership, gasoline and maintenance costs, suddenly the entire economic landscape shifts from one of greater car dependency towards one of greater sustainability. Go and see the landscape for yourself. 

To get off fossil fuel, we need to make our cities and towns more compact, walkable, and efficient. If we can make this one simple change to the economy, it moves from the realm of Sisyphisean task  to the realm of distinct possibility.