In Abundance: How We Fell Behind and How to Build a Better Future, Ezra Klein and Derek Thompson claim the US is not suffering from a lack of resources or imagination but from a crisis of complexity. After decades of promoting solutions for housing, local food systems, and clean energy, we sense truth in their argument.

Ezra Klein’s “Everything Bagel” – a tendency for the government to layer so many goals, safeguards, and procedural requirements onto a single project or grant that it inhibits the desired outcome – resonates deeply with our experience. In one federal grant we pursued for AgriFlats, the USDA required that we respond to a list of 21 goals. In 2023, a City of Chicago Affordable Housing Grant required we address 16 priorities unrelated to housing.

These adjacent goals are born out of good intentions—protecting the environment, promoting equity, and preventing harm – but over time, the Everything Bagel has made it nearly impossible to build anything affordably, quickly, or at scale. The result is unnecessary scarcity in a nation of immense wealth. We’ve experienced two barriers responsible for some of the incongruous scarcity: innovation funding and affordable housing regulations.

Innovation Funding

One barrier to abundance is how America funds innovation. Derek Thompson takes the federal government to task for rewarding predictability over boldness. Risk-averse grantmaking leads to incremental gains, not transformative breakthroughs. We see this tendency in City initiatives, too. It’s common for people to laud risk-taking, but few engage in it.

Derek Thompson references Gregory Petsko’s 2012 essay, “Goodbye, Columbus,” which offers a satirical critique of the innovation funding landscape. In the essay, Columbus’s proposal to discover a new route to the Indies is rejected due to a lack of preliminary data and perceived risk. The monarchs favor projects with guaranteed outcomes, such as counting olive trees, over ambitious ventures into the unknown.

This tendency to avoid controversy and risk leads to “rinse and repeat” projects. Critics reward leaders for taking safe bets backed by successful statistics. You can see this tendency in City grants repeatedly awarded to projects following the same formula, often featuring vacant retail space below subsidized housing. Few challenge the status quo by offering solutions that build human capital or create jobs.

Affordable Housing Regulations

Another barrier Klein identifies is eye-opening. He contrasts the outcomes of Houston and San Francisco regulations seeking housing affordability and availability.

• Homelessness: Houston has the lowest homelessness rate of any major US city. It costs $17k to $19k to serve a homeless resident in Houston compared with $40k to $47k in San Francisco, with $35k earmarked for housing costs alone.
• New Housing Construction: In 2023, the Houston metro area issued permits for 70,000 new homes. The San Francisco metro area issued 7,500 new housing permits.
• Median Housing Costs: In Houston, the median cost for a home is $300k, compared with $1.7M in San Francisco.

These disparities underscore how Houston’s minimal zoning laws and streamlined permitting processes facilitate housing development, leading to greater affordability. Other cities like Minneapolis have started to remove barriers created by exclusionary zoning laws. Klein argues that progressives have focused too intently on making rules instead of ensuring outcomes. The result is a feedback loop of frustration: citizens lose faith in government because government appears incapable of solving real problems—often because its own rules create too much friction.

Locally, the cost of creating affordable housing is sobering. In 2024, the 43 affordable housing units in Fifth City Commons, a Chicago C40 grant award winner, cost nearly $900,000 each. In the top six affordable housing projects under construction in Chicago in 2024, the average cost of an affordable housing unit was $723,000. The comparable average cost of 700 units built by one not-for-profit Chicago developer without public funding was $200,000 per unit.

Navigating the complex capital stacks and regulations of affordable housing is impossible without hiring an expert. In Chicago, that’s in addition to the other experts you need to navigate the regulatory waters like a permit expeditor. 

The Abundance Aspiration

Klein and Thompson’s call to action is simple: abundance is a policy choice. Our federal and City governments can reform permitting laws, streamline scientific grants, empower leadership to overcome local obstructions, and build the capacity to execute ambitious projects. Instead of the Everything Bagel, governments can grant actors the agency to choose which adjacent goals to pursue. The City’s “Green Matrix” is a good example of this.

As economist Mariana Mazzucato says, the government does not have to choose winners, it just has to choose the willing. Our leaders should take a bite out of the Everything Bagel to nourish our willing changemakers.