Lyn Stoler and Sonam Velani have coined the phrase Climate Industrialism to describe the optimistic, action-oriented response to climate change they already see happening in many communities around the world.
Lyn and Sonam define Climate Industrialism as ‘a social and economic system built on the creation of climate technologies that yield human and environmental co-benefits.’
What does that mean, exactly? And how does Climate Industrialism create a virtuous cycle for companies building climate solutions and the cities where they choose to build?
Lyn and Sonam are the cocreators of Parachute, a research and storytelling project that shares climate solutions with local governments around the world to make our cities more beautiful, more livable, and more resilient.
On this episode of Reversing Climate Change, Lyn and Sonam join Ross to explore their new model of Climate Industrialism and explain why cities need to take the lead on climate action.
Lyn and Sonam discuss the history behind the regulations and permitting processes that slow industrial building and describe how cities can attract talent by welcoming climate industries.
Listen in to understand the pros and cons of startup cities and learn what municipalities can do to promote both climate change mitigation as well as adaption and resilience through Climate Industrialism.
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Carbon Removal Newsroom, the news show that ran alongside this one, is over. Its episodes are still up, on the feed Climate Workers Anonymous now uses.
Carbon Removal Memes is still going.
Resources
Lyn & Sonam’s Piece on Climate Industrialism
UCLA Center for Healthy Climate Solutions
White House Accelerating Infrastructure Summit
The Network State: How to Start a New Country by Balaji Srinivasan
Full Transcript
Alexsandra Guerra: You’re listening to the Reversing Climate Change podcast by the team at Nori, the carbon removal marketplace. This is a show about the innovators and entrepreneurs developing solutions to climate change.
Ross Kenyon: Hello and welcome to the Reversing Climate Change podcast with Nori. I’m Ross Kenyon. I’m one of the co-founders of Nori and also the creative editor there. Today I have with me Lynn Stoler and Sonam Balani, co-founders of Parachute. Welcome to the show, you both.
Lyn Stoler: Thanks for having us.
Ross Kenyon: I’m happy to have you here. We got introduced by an old friend of mine, Zachary Caceres, who he’s been working on cities and thinking about cities and environments for startups to be successful. He just had a piece at A16Z too. So I saw him say RIP my inbox. Good for you, Zach.
Lyn Stoler: Yeah, I actually was emailing with Zach. And after the A16Z piece came out, he was like, I’m so sorry, my inbox is absolutely flooded. I was like, you go, that’s a huge win. Like, it’s a good problem to have.
Ross Kenyon: I think so, too. I was really happy to see him be successful. He’s long been one of the brightest people I know. And I’m happy to see him focus on cities. And that opens me up to this first question here of grounding this conversation. Why cities? There’s so many different skills you could be focused on, both in terms of governance. It could be counties. It could be states. The UN level. Why cities? Why should people be thinking this way?
Sonam Velani: I’ll start with this one. I’ve spent my entire career on cities, so I’m obviously biased, but I was born in Mumbai, which is one of the largest cities in the world. I grew up in Chicago and now live in New York City, also one of the largest cities in the world. It’s a story about numbers more than anything else. The world is urbanizing. There are about 4. 2 billion people who live in cities Today, that number is going to go up to about 6. 7 billion people by 2050. To accommodate that growth, we’ve got to get it right.
We’ll obviously get into that discussion later on in the podcast. I think those sheer numbers in and of themselves are one of the main driving factors of our focus on cities. The second is around just infrastructure systems. About 75% of the urban infrastructure of 2050 is yet to be built. We see that as a huge market opportunity, as well as a huge policy opportunity to get it right. So that we’re getting up to that 6. 7 billion number. We’re building systems that improve humanity because the vast majority of the human race is living in cities.
And then the other piece, particularly as it relates to climate, is that cities occupy about 3% of the land mass of Earth, which I think when I say that to people, they find very surprising that But Earth is very big. And yet they contribute to over two thirds of emissions, GHG emissions that are in our atmosphere. So if we’re about to do something, you know, we’ve got to start at that core unit and focus on science. And it’s really gratifying, you know, again, having worked in this space for a long time, that over 6,000 cities around the world now have climate action plans.
Cities globally spend about $380 billion a year on climate action, and that’s just today. So all of those numbers, all of those trend lines, you know, the startup space, we talk about hockey sticks, like that is happening in cities as a unit of both governance as well as investment. Yeah.
Lyn Stoler: On my end, you know, some of them and I have very different backgrounds. Some of them came from an infrastructure background and I came from a health background. I had no intention, quite frankly, interest of working in climate originally. I was working in public health and then ended up transitioning to this climate health intersection when I started to see climate impacting my work and, you know, the problems I was working on, the solutions I was trying to work on to help solve those problems. Overwhelmingly, when you take a look at climate from the health perspective, the impacts are so, so local, right?
I was working at the UCLA Center for Healthy Climate Solutions and we would see block to block, like not even zip code to zip code or city to city, block to block within a city, we would see different rates of morbidity and mortality or basically different degrees of impact because of climate change threats. And so to me, I don’t think that it’s fair To expect the federal or state government to be able to address all of those really local needs and all of the types of solutions that we need because like local people understand their impacts and how they want to solve for them.
So that’s why cities.
Sonam Velani: Yeah, well, just one other point on what Lynn just mentioned, right? Rubber hits the road in cities, the federal government generally shuffles money around and comes up with big policies and passes huge legislation like the infrastructure bill or the IRA more recently. All of that money then trickles down in Actually, the White House today is hosting something called the Accelerating Infrastructure Summit. 90% of the federal dollars are ultimately executed by states and local governments, municipalities. Not only is that important in terms of how projects get done and ultimately financed, but also rubber hits the road in cities.
When you walk out of your door, if your street is flooded, that is a city problem. When you get on the subway and if it takes you two hours to get from point A to point B, that is a city problem, right? Your federal government, yes, it can help with money, but it cannot build those infrastructure projects that are hyperlocal.
Ross Kenyon: I am so sympathetic to that argument, almost to the point of bias. I favor subsidiarity wherever possible. Things should be at the most local scale possible, wherever that may be. I also have this contrary impulse that we’re in Seattle where I live, the city council will often make large declarative statements about issues that are much greater than the city level. And I’m like, can’t you just make sure there’s no needles in the parks? Can you just make sure that things are clean and broadly work? Should you really be working on climate change if you can’t do the most basic things the city should be expected to do?
So I have a lot of anger when I experience my city as being grandiose or too big. Am I wrong or is there a part of that is not terrible?
Sonam Velani: We actually visited Seattle as a part of Parachute’s first season. And I was actually just there a few weeks ago. And I hadn’t been since I was in high school, right? And to date myself, that was, you know, almost 15, 20 years ago. And I will say, you know, I think as much as we have qualms about how sometimes things don’t work in our society, Very hyper local urban environments. On a grander scale, you have it better than like 90% of the world, right? And I will say in Seattle in particular, you know, your government passed a sales tax to fund the expansion of transit systems across the Seattle Bellevue region.
Ross Kenyon: Oh, I got thoughts on this. Just set me up. I got stuff to say.
Sonam Velani: And it has built a lot of housing along those new lines, right? I think that there’s a huge question of affordability of that housing. In Seattle, you have affordability requirements, but developers can build elsewhere, which defeats the point of affordability requirements, right? So there’s a lot of nuances to this discussion. But yeah, sometimes we think that we don’t have it. We don’t have it great. Yeah, that’s often true. But I think we’ve got to look at the big picture here in terms of some of the global progress that is happening in this space.
Lyn Stoler: And Ross, I’m really curious to hear your thoughts on all this, but I just really quickly will say that, you know, I really sympathize with this experience of like, oh, you know, like, There’s people, you know, using drugs, like visibly, you know, in cities, let’s say, I spend a lot of my time in the SF Bay Area. And that’s, you know, something that we deal with. And it feels like, you know, we should be addressing some of these issues before we get to the Oh, you know, we as a city are going to solve climate change.
And I think that’s part of the reason that Parachute tends to focus on solutions that actually make our cities more beautiful and livable and resilient to climate change along the way. So it’s not necessarily about like, Oh, how can we as one city single-handedly mitigate 0. 0001% of GHG emissions? Because I feel like that makes climate solutions feel like this far off, grandiose, to use your word, thing. But a lot of times, climate solutions are the things that make our lives and our cities much better. And so it is really about that lived experience.
Part of this for me is also having spent... While living in LA at the beginning of my career, it’s driven by some of that frustration. It’s around livability too.
Ross Kenyon: I think that’s a very, both of those are fine counterpoints or things to consider and to keep in mind while discussing this. And this light rail, a question of infrastructure being built in Seattle is maybe a fine point to launch into this climate industrialism model that you set out. Because the thing that really bugged me about the light rail expansion The Nori office is in Ballard. The light rail is coming, but it’s not coming for more than a decade. And there’s like two steps ahead of the actual building, one of which was planning and the other one was design, both of which were four years.
I was like, what is happening? I was asking my colleague, Siobhan. She used to work in cities and planning and was saying that a lot of this is NEPA and making sure that environmental reviews are happening. I know there was a whole thing within the IRA about to what degree permitting reform is going to happen or not. I heard it got taken out. I’m sure a lot of this is NIMBY stuff. Wow, there’s so many acronyms I just used. Why can’t we build things? Like, why does it take that long to just lay some track?
This is a technology that’s over a century old. Why is it so hard?
Lyn Stoler: Yeah, you know, this is actually, this is a point that we both, I think, feel pretty strongly about. And, you know, we just released this piece on climate industrialism. We opened with like, look at all these things that we built so quickly, right? Like from, I think, inception Yeah. Yeah. And I think that at the time, there was a real need for that type of government response because it was It was a safety thing. But a lot of that infrastructure around permitting and review has gotten in the way of our ability to build.
And I think it’s actually really hurt the morale around the ability to build. We talk to developers that are like, And so I think a real piece of like our climate industrialism sort of hypothesis is that a way to enable change, like there’s so much talent and dollars and impatience around getting climate action on the ground, right? And like real solutions and like the city’s That are going to really thrive in like the next couple of decades are the ones that are, you know, reforming their permitting process or, you know, states that are going to look at, you know, like reevaluate their environmental review process, right?
That’s our version of the environmental review process. And that’s basically become a way to stop any development. And so there’s, I think, a lot of opportunity. We see this as a problem to be solved. And any problem to be solved is like, that’s an opportunity. So any city that is able to make it friendlier and easier to build cheaper, faster, and still hold a standard for safety and environmental quality, that’s going to be a place that really thrives in this era.
Sonam Velani: One of our favorite quotes, I think I speak for Lynn on this also, is actually from a former mayor of Pittsburgh. His name is Bill Peduto. And he said, rather than putting out the red tape for new technologies, we should be rolling out the red carpet, right? Right. And we think that applies enormously to climate tech, right? And how that new generation is going to change this new generation of investments, how quickly it rolls out. In infrastructure, we speak, we always talk about on track, on budget, and on time. You hardly ever meet those three, right?
Find me a project that has. I think our Second Avenue subway in New York City was originally conceived the 1940s and it opened four or five years ago. So it’s four stops to make you feel better about your Ballard situation in Seattle. But yeah, I think that is a huge piece of how cities can actually reform this process is actually... Figuring out the regulatory process and working with companies to actually understand what are the needs that they have and what should the city change. Over the past many, many, many decades, over the past generation or two, we’ve put on Band-Aids to solve for a lot of the environmental and labor challenges that we’ve seen in our country.
And frankly, those Band-Aids don’t fix the problem. You’ve got to sort of rip it off and start from scratch to a certain extent in terms of how you’re looking at the regulatory framework. And that’s where we think cities can actually, the cities that are going We’re going to be successful in this are those that partner with startups and with industry from the idea stage all the way to product market fit, all the way to commercialization and digging shovels into the ground and making sure that when you’re digging, you’re going fast.
And a lot of that is startup speak, but I think cities are starting to incorporate a lot of this type of discussion as they think about simplifying permitting and zoning and the procurement process and really rolling out that red carpet.
Ross Kenyon: Do you have any sense historically when this change happened? I associate a lot of this with progressives’ interest in the precautionary principle. And in fact, I think if you ask someone in a vacuum that was progressively inclined, would they prefer more or less regulation? They would say more without knowing even what it was being regulated or why. Does it have to be this way or could it be some other better way?
Lyn Stoler: So I have, so there’s like the, there’s the permitting and regulation side of things. And then there’s some like, I think other historical trends that have really led to this. And someone is going to have more expertise on the permitting and regulation side. So I’m going to leave that to her, but I will say, you know, as we were leading up to releasing this climate industrialism fees, I was very deep in the history of industrialism and we saw, I think this, um, Historically, we’ve seen industrialization and urbanization are super closely linked.
You see, as soon as factories get built, that’s when housing gets built and that’s when roads get laid down. That’s when you get urbanization. And that’s when you have a bunch of employees that suddenly can afford to buy lunch or dinner, right? And then you get a service sector that arises and you get this really beautiful organic fabric that springs up around industrial work, right? Right. And that was really exciting in the American Industrial Revolution. That went from 1870 to 1950, let’s say. There was a lot of problems with how they built in that time, though.
Everything was built really fast, really cheap, to the point that it was dangerous. It was unsafe and it was not a nice place to live in a lot of ways. And we don’t even have to get into the working conditions. But that was all of those sort of social things aside, there was that really core piece that urbanization and industrialization went hand in hand. And since the 1950s, we’ve seen a huge shift in the American economy, right? Massively de-industrialized. You got a ton of people moving out to the suburbs. There was even this trend of ex-urbanization, which I just learned is just moving far away from any urban community, not even the suburbs, right?
And as that happened, we started building out instead of building up. We saw that people... In that process, we’re less invested in, oh, the tax dollars that are going to this really vibrant urban community and are going to build the light rail or are going to resurface our roads, whatever else. And so I think that you saw this huge decline and disinvestment. Climate Change isn’t just going to be solved. It’s going to be solved in part behind our computer screens, but it’s not just Right. If we get it right this time, I think that we can see this healthy industrialization and urban growth go hand in hand.
And hopefully because the technologies that we need for climate, like to respond to climate change, those technologies, they are inhaling. Inherently, they have to be clean technologies, right? And so we’re hopefully not going to get old trope of London with all of its smog, you know, back during the first Industrial Revolution. So that’s kind of like a historical sense. But I think, Sonam, you can give more of the modern permitting reform sense. But I would just say that it’s been since like the 1950s.
Sonam Velani: Yeah, we basically built the interstate highway system, which was the last big undertaking, in my opinion, of American industrialism, right? Or the American Industrial Revolution. And then... We built all these passages and we have the Model T. That was Eisenhower, right? Yeah, exactly. We have roads literally to take people out of cities and into suburbs and urban sprawl and a whole host of other things that both Lynn and I really, really dislike. And that enabled people to move away from... Some of these challenges that had cropped up in these cities and a lot of that, frankly, you know, people started having a sense of ownership of their place, right?
As they moved to the suburbs, they moved into houses with white picket fences. They have owned cars, right? They’ve sort of had all of this physical goods that they called their own and that sense of shared space and shared sort of lived experience, I think, Started to decline. And when you do create that sense of ownership, you also end up with a lot of, you know, this is mine and I don’t want this in my backyard. Right. And that’s how this whole formation around the NIMBYism movement really came to being.
And I think that there is a lot of discussion. Frankly, particularly amongst people of our generation of how do we undo all of that? Right. I often say the first way to undo all of that is actually not to sit behind your computer screen on Zoom and in meetings all day. Right. But to literally show up at your community board meeting at 4 p. m. or 5 p. m. or whatever it happens. Right. And raise your voice and make your voice heard. And I think people, frankly, who want change need to be involved in those physical spaces to make that change happen.
Ross Kenyon: How much of cities leading on climate change do you think are adaptation based or actually removing carbon or decarbonizing in some way? What’s the balance between these strategies?
Sonam Velani: Yeah, we actually launched Parachute with a thesis that the equation is really messed up.
Ross Kenyon: Maybe you should also, I kind of buried the lead a little bit. What is Parachute too? And wrap it all around that.
Sonam Velani: Why don’t you start with the what is parachute piece? And then I’ll talk about the adaptation versus deviation piece.
Lyn Stoler: Yeah, that sounds great. Okay, so yeah, parachute is a research and storytelling project, where we are sharing climate solutions around or in cities around the world that make our cities more beautiful and livable and resilient. Because, you know, These changes to our environment are happening already and they’re in the here and now and they affect people already like in their daily lives and in their homes, whether or not that’s been communicated to them. Right. And so we need to have solutions that can help. Respond to that threat today and tomorrow.
And that’s why we think adaptation and resilience is a really important part of this equation. And mitigation, we’re like, that is incredibly, incredibly important. But there’s so much talent and resources going towards it right now. So we wanted to highlight some of the opportunity around adaptation and resilience. And someone can sort of give a sense of why that equation is so imbalanced.
Sonam Velani: Yeah, so I think we’re in an age where people know that there’s climate change, whether or not they believe it, I think is a different story, right? And whether or not they believe the science behind it. Frankly, it’s been politicized, particularly over the past five to 10 years for a lot of reasons. But again, when you walk out of your door and there is a foot of water that you have to wade through to get to the subway, even if it’s open, that’s climate change in action. And I think one of the things that we focus on is that 93% of all climate finance, money that is invested into dealing with climate change, 7% of this goes to adaptation.
And we think that there’s a huge mismatch, right? Climate change is here and now, and we got to do something about it today, not by 2050, right? 2050 is another 30 years away. Like, good luck to you, right? You know, walking through your one foot of water every single day as you’re trying to Drop your kids off to school. So we think that there’s a huge opportunity there. And actually, just last week, we talked a lot about the importance of flipping the script on a lot of this and building for resilience.
I think Hurricane Ian said, is a very real and live example of that. In Florida, there were over 100 deaths, about $75 billion of economic losses. And these are just early estimates, right? As insurance companies and governments and people are actually assessing the damage. But I think one of the challenges that we see is that there’s this entire discussion of build back better. Well, what does better actually mean, right? I think that there are a lot of, frankly, Differences in opinion and tactically how better is implemented in the real world.
And that’s where we think building back better actually means building back with resiliency in mind. Once that, again, I’ve spent my entire career in this space, but one stat that I always refer to, particularly for the newbies, which we’re very happy to have you all, is that for every $1 we invest in pre-disaster mitigation, we save $6 on the back end in We’ve really got to put our money where our mouth is, and it will generate returns multifold. These are VC-type returns that we’re talking about here. It will generate returns multifold, but a lot of that is starting with good information and data about where your climate impacts are.
There are a number of companies that are helping cities and governments do that. Floodmap and Cloud2Street are OpenStreetMap are a couple of the ones that come to mind. Thinking critically about where you’re building, and this gets into a much longer discussion about managed retreat, but keeping in mind that if you’re building on the same stretch of sandy beaches, that Stand in hurricane pads, you know, year in, year out, maybe you shouldn’t be building there, right? Beaches should be used for suntans in good weather, right? And as coastal protection barriers in bad weather, not necessarily for multimillion dollar beachfront homes, right?
And then the Third is around getting your finances in order, right? So again, putting your money where your mouth is. And then the fourth is around actually using resilient materials and design principles to build sustainably, because anything that we build today, hopefully will be around in 30 years. And then frankly, most likely, right, the average life of a of the built environment stretches into the hundreds of years. So those are just some of the things that we think about when we go out to these communities, talk to policymakers, talk to entrepreneurs, talk to nonprofit organizations and community members about how to build better livable communities.
Ross Kenyon: All very fascinating. There’s so many angles to take. The most at hand for me is that I’ve read a fair amount about federal insurance subsidies or policy that encourages unsafe building. I’ve seen things where no private insurer would insure various types of beachfront or wildfire property. And yet they face some sort of political pressure. I don’t know who’s lobbying for this or how this happens, but then they will get no... There’s like a market solution here that seemingly everyone, the conservatives, no reason to oppose. The market is unwilling to ensure this dangerous, risky property.
And yet the government has stepped in and encouraged risky behavior. Am I right about that? I’m seeing smiles. I’m hoping that’s still true.
Lyn Stoler: Yes. And part of the smiles is that I am in some ways a perpetrator of this issue.
Ross Kenyon: No, no, no.
Lyn Stoler: It’s okay. But it’s like actually a point of, I guess, slight embarrassment for me, but I talk about it very openly because it’s So relevant, especially to being in the climate space, I bought my first home in Big Bear in California. It is in the San Bernardino National Forest, right? It’s a ski community. I bought it when I was like, you know, I was like, I need a COVID cabin. This is urgent. I love the ski. I was like, this is perfect, right? I went to go get insurance when I was closing on the home and couldn’t get it anywhere.
Had to get it through the state government, like California’s fire insurance program. As soon as I put in the zip code, every private company was like, absolutely not. We will not even look at this. And so I had to get it through the state. And this year, and you know, like It’s actually been this, like, point of stress. Every, you know, fall, I’m like, oh my god, like, it’s wildfire season, and it’s been something that weighs on me, and I didn’t anticipate it having such a huge mental and, like, emotional impact.
And then Sonam knows this, this past, I think it was September, sorry, the August and September are blending, because that’s when we were traveling to do all of our parachute research. It was a different, it was a different city every week, but, you know, just this fall, A wildfire broke out in Big Bear and got to within a mile of my home. And, you know, it was very stressful. I was, you know, really emotionally coming to terms with the fact that I could lose my home in that process. And I’ve been working in climate and I actually, you I’m very lucky that I get to work remotely and be in the mountains.
But I think that there’s This like real conversation of, you know, as we, you know, if we’re not going to build up and build dense climate friendly cities, we’re going to build out and then people are going to get pushed to this wild blend urban interface. And, you know, you get these communities that are very wealthy, you know, like along the beach. But, you know, then you get communities like Paradise, California. Right. And Paradise, you know, was completely different. They’re actually rebuilding right now. But it begs the question of like, you know, where should we be rebuilding?
How should we be rebuilding? And where should we be building in the first place? Because oftentimes, we’re actually ending up pushing a lot of our most climate vulnerable communities already, right into these areas where you can’t get insurance, like you can’t get private insurance. And it’s like, how do we deal with that?
Sonam Velani: Yeah. And I would even add, I actually started my career at Goldman Sachs doing infrastructure finance. And one of the very first deals that I worked on was a bond issuance for catastrophe risk bonds for the state of Florida. And I was 22. I had no idea what I was doing. Fresh out of college, interested in this stuff, but no idea what I was doing. And the more I learned about this, here we are trying to finance a bond product so that the state of Florida can ultimately pay out Insurance claims that are not covered by FEMA and NFIP, which is the National Flood Insurance Program, or by private insurers, who are the companies that traditionally should be offering these products.
And yeah, I learned about this. I was like, this is really dumb. We shouldn’t be doing this. And again, this was in 2009, 2010. And here we are more than 10 years later, literally having the same conversation. And a lot of this is political discussions. Right. FEMA tries to change its flood maps and they get pushback from every Tom, Dick and Harry politician saying, oh, we don’t want to be designated as a FEMA flood zone because that will drive down our property values. Right. And we don’t want that to happen.
So there’s this perverse incentive where we don’t want to, we’re trying to have our cake and eat it too. And frankly, a lot of that comes back to, frankly, hyper-local politics. But to bring this out on a more national and frankly global scale, insurance as a process, Product is extremely important as we go forward, right? Particularly given the increase in disasters that we’re seeing year in, year out, right? Disasters cost about $200 billion a year globally, about 90% of These losses are actually in developing countries. 90% of the lives that are impacted are in developing countries.
And we’ve got to sort of figure out where the risk is and who needs the most help, but also building financial resilience. Preserve funds for strong social safety nets that can protect the people who are most impacted by climate change. I will point out, you know, at the World Bank, I used to work there after Goldman. And one of the things that kind of made up for all of the things that I did with Florida cat-risk bonds was actually developing... A disaster risk financing and insurance program for the country of Pakistan, right, which has significant climate risk.
A third of the country was just flooded just a couple of months ago over the summer and, you know, is in partnership with the private sector, is in partnership with Munich. And it actually went around the country to figure out what is the value of your infrastructure assets and your public assets. How do we, one, again, collect that data, two, put a value to that information and to these assets, and then three, ensure those assets as a way to protect those assets and, frankly, protect the balance sheet of Which is extremely necessary when your country is a third underwater, right?
And you’ve got to figure out how to pay for things. So there are, again, movements in this space, but we think these types of efforts need to be 10x to deal with some of the challenges at hand.
Ross Kenyon: How much room do you think there is for cities to become much more politically important or to have more responsibility to make larger decisions? Lynn and I were talking a little bit about Balaji Sreenivasan’s Network. Yeah.
Lyn Stoler: No, no. So this is, this is like, I guess, Sonam and I have some equally, I think, spicy conversations around startup cities, because we have, you know, different, like, we have like wildly different opinions on startup cities and their role, you know, in society. But This is actually in some ways what led us to the climate industrialism thesis, I guess, to sort of bring it full circle. You know, I think that there’s a few points that we really, really do agree on. And the first is that, you know, the network state hypothesis, right?
Like there’s this idea that, you know, talent is going to find new places to live and it’s going to aggregate around values and, you know, lifestyles, right? I think. And so... I think that one of the things that is driving people wanting to move away from places, like we saw this during COVID, some movement from, let’s say, San Francisco to other areas, like, let’s say, Miami. And a lot of that is driven by the fact that there isn’t as much investment happening in a lot of cities. If you can, especially like, let’s say Rust Belt cities, right?
If you can bring this sort of idea of tactical urbanism and reinvestment and drive dollars and talent into existing urban environments, you can actually like almost kind We kind of make a startup city in a cultural startup city, I guess, in some ways, in cities that have seen these industrial booms and industrial busts and are sort of looking for a way to rebrand and re-identify themselves. And so, you know, we build for climate industries, right, like if we are investing in advanced purchasing agreements from the city and then policies that make it really friendly to build in cities and to then like build a factory.
Not just infrastructure, right? But like also a factory and hire people and do all these things in a city and like housing, then you’re going to get people that want to, you know, there’s so much talent in climate and people are going to be like, oh, I want to move to Detroit and I want to start my company there and I want to do my manufacturing there and I’m going to hire people. And, you know, you can get this organic urban fabric that arises. And so I think that there’s this sort of like Climate industrialism is in some ways our response to this network state idea.
And there’s a very similar proposition can be made for completely new startup cities, right? But then the value proposition is the same for both. It’s like a strong business case for cities. Then there’s already so much excitement, so much mobilization, so much in terms of talent and funding that’s going towards climate that it This is the moment to me, right? Like this is the wave to ride for cities. So I think that there’s a piece around the cost too that you had brought up earlier during our discussion that I really loved.
Sonam Velani: I have very different opinions on startup cities, but again, much longer conversations. I will reserve that, right? But I will say, right, given the rate of urbanization and I, you know, we started this conversation with the question of why cities, right? When you’re getting from 4. 2 billion people today, To 6. 7 billion people in 2050 living in cities, we’ve got to put all these people somewhere, right? And we’d love to put them in dense, you know, we’d love to put them in places that look a lot more like Manhattan than frankly, places that look like suburban.
I think the concept of startup cities to me is actually more around how to use technologies that a lot of the people in the startup cities conversation are talking about. How do you actually use the technologies that exist and are going to exist over the next 10, 20, 30 years and apply them to The existing framework of large global cities around the world. How do you take things like pervious concrete, mass timber construction, modular housing, e-bikes, right? Much more sustainable forms of transportation and layer them on to the existing framework.
And that is where I think a lot about technology and its ability to reduce the cost of city building in order to accommodate the growth of cities as well as the sustainability of cities. So ideally, we’d still keep that same ratio. Cities occupy about 3% of the landmass of Earth today. We don’t necessarily want that to be 4%, 5%, 6%, 10% as we urbanize. But how do we do that, again, with smart technology, smart tools, and drive down that cost of city building?
Ross Kenyon: I think it’s fair to ask why there couldn’t be private cities. We’re so spoiled with technology, right? You have private companies who start and they change the way that we live, often for the better. Not always, but often. I think people only have one model for private cities and it’s basically company towns where people were paid in script and had to go to the company store and you could never get out of debt. It’s basically like industrial sharecropping. It’s not good. Right. But I think we’re at a point now where hopefully that would not always be the case.
And there are some circumstances where the term I’ve heard for this is residual claimancy. So you have some sort of owner who has an incentive to create a productive and healthy space for people to live and work. And that hopefully the incentives would be set up such that they would be encouraged to foster economic and human well-being within these spaces. Is there a role for that? Is this fantastical? Maybe both?
Lyn Stoler: So yeah, I guess this is actually like, this is the area where we get into some of the spice around buy and sort of opinion differences. But like, I think that there is a role for that. I’m really, I’m personally pretty excited about the idea of startup cities. I think it’s also important to be really critical of where startup cities have gone wrong in the past. And, you know, the idea of cities or areas that have been, you know, solely owned by companies in Southern California, you know, I grew up not too far from Irvine, California, and you can really tell that was, you know, like Irvine Ranch was very, very private, right?
And so I think that there are models, though, that are emerging that are really exciting. I mean, one of the developers that Sonam and I are both really, really happy to see Make huge headway is cul-de-sac in Tempe, Arizona.
Ross Kenyon: I went to ASU and I remember seeing that as I was passing through that this was getting started. Is it going now?
Lyn Stoler: They are fully building. I actually did a site visit on their construction site when I visited there a couple months ago. We have a field note coming out or a street note, sorry, coming out that sort of sums up our visit and what we learned. But they are doing some absolutely incredible stuff. And I think that what they’re doing Right. Right. Right. There’s a lot of community engagement. How we do things matters, right? Like the product matters, but how we get there matters. And I think cul-de-sac is a perfect example of that.
And I think that it’s that type of innovation and especially, you know, rethinking the process of startup cities that is and, you know, like how we finance. Again, if we are putting down climate industries as a way to attract a variety of talent and financing and create a really robust economy and built environment, I think that’s a way to do this right. I think that there’s a lot of space for experimentation.
Sonam Velani: I generally agree. I think the one place where I think we really, really, really need to be mindful of is how these cities are financed. Nine times out of 10, startup cities are founded by some wealthy developer, some rich person who wants to put a stake into the ground, literally, and physically put a stake into the ground. And these end up being contrived utopias. And frankly, I don’t think the vast majority of people, not just in the United States, but in the world, want to live in that type of place, right?
So we’ve really got to think about what are the affordability mechanisms that we are putting into place? And frankly, again, government has a role to play in this, right? When there’s new developments coming up, are we making sure that nobody’s being displaced? Are we making sure that the buildings that are coming up That the units have affordability mechanisms put into place for a variety of income levels. If we’re talking about climate industrialism, again, it’s not just people building bits, right? It’s people literally building atoms, right? You’ve got to have folks who are working to put up solar panels and wind turbines and all sorts of hard infrastructure and bring that manufacturing and sort of those good middle class jobs back to some of these communities.
And ultimately, you know, the Wage levels and the rent levels have to go hand in hand. One of the challenges with cities today, especially if you look at a place like where I am, I live in New York City, I write on housing policy and all sorts of things. It costs $4,000 to get a one bedroom apartment in Manhattan these days. Most people do not earn that kind of money. And I think that is the challenge of how can you Create communities that are close to transit, which is what I love about cul-de-sac.
It’s literally on a train line that takes people up and down Tempe and into Phoenix, right? In a high growth environment. And again, uses great technologies to drive down that cost so that affordability can then be passed down to the end consumer and the renter or buyer in some of these places. And are again, matched with the wage levels that a lot of the climate industrialism jobs are going to bring.
Ross Kenyon: Well, thanks so much for being here and giving me so many things to think about, Lynn and Sonam. It was great having you.
Sonam Velani: Thanks, Ross. Yeah, great to chat.
Unknown speaker: Yeah, this was a lot of fun.
Ross Kenyon: I’m glad you had a good time. And links to those things are in the show notes too. I’ll put this at the top so people can make sure to read your excellent new article, The Age of Climate Industrialism. Links to their writing and work is in the show notes. And thank you so much for listening. If you like what we do, please give us a great rating and review on Apple Podcasts or Spotify. Share this with a friend who likes cities. I don’t know.
Lyn Stoler: Or climate.
Ross Kenyon: Climate, yeah. All of the above. Thanks so much for listening and have a great day. Thank you so much for listening. If you could please subscribe and give us a great rating and review on Apple Podcasts or a rating on Spotify, that’d be much appreciated. It helps us get our content out to more people. You can sign up for our newsletter at nori.com. Follow us on social media. We will catch you next time.
