I recall my My Pakistani professor told me the following joke:
In the Koran, everything is permitted, except those things that are forbidden.
In Iran, everything is forbidden, except those things which are allowed
In Pakistan, everything is permitted, especially those things that are forbidden.
Which seems to be a variant of Churchill's (WWII) joke:
In England, everything is permitted, except those things that are forbidden.
In Germany, everything is forbidden, except those things which are allowed
In Russia, everything is forbidden, even those things that are permitted.
It's an old chestnut, and different jokers use different countries (reflecting changing circumstances). But it does get to the root of what is meant by liberalism (Case 1) and where our zoning has gone wrong--so much land has been downzoned that we are no longer operating in a Case 1 context, but in a Case 2 context.
And, to be a bit brash about it, that's simply un-American. We inherited the English Common Law tradition of property rights (lawsuits and all), and we have so meaningfully limited our land rights that it can be said we have eliminated them. So we should, as a country, do something about it. It's been politically palatable for years, because voter class was nearly identical to the home ownership class. But the recent destruction of housing affordability, due to COVID-induced migration and the advent of remote work means that more households are staying in rental tenure longer. And over time, that's going to destroy the political acceptability of the suburban covenant, and we see that today in the YIMBY movement. NIMBY has been around for a long time (a pejorative) but as someone who has been watching housing affordability for a couple of decades, the political groundswell of the YIMBY movement has been staggering.
YIMBY is chipping away at the "everything is forbidden" with an ever great list of things which are allowed--triplexes, single stair, reduced on-site parking, etc. And that's huge, because all of those things are multifamily rentals, which is going to make is possible, plausible, likely, that more households will stay in rental tenure longer, and won't sign up to the suburban covenant.
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