[Interior of an abandoned and incomplete home in a subdivision outside Phoenix, from an excellent slideshow of photographs taken by Edgar Martins, commissioned by the New York Times to document the real estate bust.]
I’d highly recommend reading or re-reading Eric Janszen’s “The Next Bubble”, which was published in Harper’s almost a year and a half ago. Given the buzz surrounding the role of infrastructure and energy projects in the Obama administration’s recovery plan and the high percentage of the spending so far which is slated to be sunk into networks of connector highways being built primarily for the sake of spending money, its hard not find Janszen’s article eerily prescient:
There are a number of plausible candidates for the next bubble, but only a few meet all the criteria. Health care must expand to meet the needs of the aging baby boomers, but there is as yet no enabling government legislation to make way for a health-care bubble; the same holds true of the pharmaceutical industry, which could hyperinflate only if the Food and Drug Administration was gutted of its power. A second technology boom—under the rubric “Web 2.0”—is based on improvements to existing technology rather than any new discovery. The capital-intensive biotechnology industry will not inflate, as it requires too much specialized intelligence.
There is one industry that fits the bill: alternative energy, the development of more energy-efficient products, along with viable alternatives to oil, including wind, solar, and geothermal power, along with the use of nuclear energy to produce sustainable oil substitutes, such as liquefied hydrogen from water…
Supporting this alternative-energy bubble will be a boom in infrastructure—transportation and communications systems, water, and power…
Its important to note that Janszen doesn’t exactly mean that this bubble can or should be prevented, even if his prediction is correct (“the only thing worse than a new bubble would be its absence”). In fact, he notes that he prefers the term ‘asset hyperinflation’ to ‘bubble’, as bubble carries conotations which may or may not apply to a given asset hyperinflation. But it does seem like a healthy cautionary note that architects and landscape architects ought to listen to, lest we pin our hopes for the future of our professions on an industry as capable of flaming out as the real estate industry.
- I was reminded of Janszen’s article by Varnelis, who should be your primary source for pessimism about the relationship between architecture and infrastructure, which I think is a necessary thing.
- a recent story about Janszen and his bubble prediction from NPR.
- a February 2008 interview at Grist with Janszen about his article.
- You can follow Janszen’s prognostications at iTulip.com. Which I’ve never visited.