Monday, August 07, 2023

Does the commercial real estate crisis outweigh the climate crisis?


President Joe Biden will make a more aggressive push for federal workers to return to their offices this fall, Axios reported Friday. It's only the latest decision by the Biden administration that ignores the climate crisis that the President at other times acknowledges is "the existential threat to humanity." The driving force behind demanding that great numbers of federal employees return to in-person work isn't for the public good, but to prop up the falling profits of wealthy private development firms and their Wall Street financial backers. One must ask the question, "Does the commercial real estate crisis outweigh the climate crisis?"

The reduction in downtown leasing and activity is hardly limited to Washington, D.C. But developers here have an advantage office tower owners in other cities don't: The federal government can order all 141,367 of its D.C.-based employees back to in-person work. Yet that singular power is precisely why the Biden administration shouldn't.

A great opportunity to make unprecedented strides toward reducing carbon emissions, pollution and global temperatures emerged during the COVID-19 pandemic. Government and private employers alike were forced to find out who could do their jobs from home, and who couldn't. But Biden declined to seize the low-hanging fruits of this opportunity. 

Imagine if everyone who successfully performed their job from home during the lockdown just kept doing that. The short-lived environmental and highway capacity benefits would have become permanent. Air quality would have improved, and expensive transportation projects could have been canceled. And while it would have been a hard-fought battle for the federal government to mandate private companies continue to allow their employees to work from home, Uncle Sam would have had no barrier or obstacle to mandate that all federal workers working from home continue doing so indefinitely.

Ordering most federal workers to return to the office would put swarms of cars that currently spend most of their time in driveways of homes back onto area roads. Workers returning by transit will have a significant negative impact on the environment, as well. WMATA only anticipates half of its buses will be zero-emission by 2033, and predicts its entire fleet will be zero-emission by 2045. The vast majority of buses still run on diesel and natural gas. This does not even take into account the coal-fired and natural gas electricity plant emissions needed to operate the Metro subway system.

The world just passed through the hottest month on record in July. Scientists and climate activists began using the term "global boiling" to describe what lies ahead for Planet Earth. The D.C. area is intimately aware of the pollution impacts of wildfires, and the extensive damage wreaked by increasingly-powerful storms. On the present course, global temperatures will likely pass the 1.5C global warming threshold sometime in the next four years.

It was only four years ago that the United Nations informed us that we had "only 11 years left to prevent irreversible damage from climate change." Yet Biden eagerly approved the Mountain Valley Pipeline, recently endorsed by the U.S. Supreme Court. His Russia-related energy sanctions and policies restarted coal plants in Europe, and will boost American natural gas output for export to Europe for at least the duration of the war, if not for decades to come. Politicians who had called for higher gas prices for decades to reduce driving fell silent when they finally arrived in 2022. Biden has sold 206 million barrels of oil from the country's reserves to date, to artificially lower the price of gasoline since.

These are not the expected actions of a President who recently said, at a press conference with California Gov. Gavin Newsom, that he has witnessed "the highest sea-level rise in more than a century. I’ve seen wildfire devastation across the West, burning more acres to the ground than are square miles in the state of Maryland. That’s how much got burned to the ground and all the — just flying over, just devastating. There’s been historic tornadoes and flooding in the Midwest and the Southeast. And just last week, across the East Coast and Midwest, we saw what you’ve already seen here in California: millions of Americans sheltered indoors, the air not safe to breathe, orange haze covering the sky. It’s incredible."

One cannot take these actions, and then turn around another day and claim we are in an existential climate crisis that threatens American lives and property. If you had found a way for tens of thousands of federal workers to get their job done without hitting the road twice a day, and you were serious about the climate, you wouldn't consider for a minute ordering those employees back to the office.

Developers are being hit in the pocketbook. Wall Street and the bankers who hold the loans on office towers are taking a WFH hit, too. Downtown traffic to businesses isn't what it was prior to March 2020. None of that warrants yet another federal government bailout to the rich, at the expense of all humanity and nature around the globe. President Biden should resist the pressure he's receiving from wealthy interests to force federal workers back to the office. The President who said "the impacts we’re seeing in climate change are only going to get more frequent and more ferocious and more costly" shouldn't add any more to that cost and ferocity.

Photo courtesy U.S. State Department

28 comments:

Anonymous said...

The sales figures for residential real estate, (June), is down over 20% and getting worse. Drones on the MSM can't understand why we're not congratulating democrats for such an amazing economy. Just don't believe your lying eyes.

Anonymous said...


People should have the option to work from home. You don't need to mandate it. Lots of folk just assume not sit parked on the Beltway.

Regarding climate change It changes. Evidently volcanic activity this year that contributed. I remember when the "experts" said we would be a new ice age and have run out of copper and oil and all starving by now.

Anonymous said...

We know that DC Mayor Bowser, last week or so, lobbied Resident Biden to bring back bidness to DC. I admit I do have a begrudging respect for that effort.

Anonymous said...

A very articulate post Robert! As someone who commuted to work for 40 years, I am a bit conflicted to read about all the folks who now get to work in their pajamas from home. I hate seeing the decline of urban spaces as a result of WFH policies. But on the other hand, you do make a good point about the impact to the climate. It seems we need to double down on the creation of thriving urban places by adding dense residential development in the urban core, and the enhancement of transit options to mitigate commuting and energy impact to the climate.

Anonymous said...

Clown question bro, as a pro athlete once said. Only a brain dead conservative would compare the two.

Anonymous said...

I don’t agree with many of your ‘political’ takes but I think you are 100% spot on here. Probably the best write up about this that I’ve seen so far. I might be biased as a federal worker but it’s gross how they pretend to care about the climate and then try to force so many cars back on the road. All for the sake of real estate investment profits.
Also all of the MOCO workers who have been ordering lunch from local family owned Bethesda restaurants will be forced to go back into DC to support a bunch of mediocre cafeterias and fast casual chains that can only survive on people being forced to eat there during work hours. This all needs to be called out more. Thanks for bringing awareness to the issue!

Anonymous said...

Most people don't want to sell their homes therefore all the positive economic data is false? Huh?

Anonymous said...

Not sure I agree with your analysis. Most Federal offices in the DC area (but not all) are easily within walking distance to a Metro station. Even if you don’t live close to a station, just drive and park at the nearest one and ride the Metro to your office.

Electric powered heavy rail is extremely energy efficient, compared to driving a personal vehicle, and the trains are already running, with plenty of extra capacity. If you are concerned about your personal safety, riding a subway is statistically much safer than riding in a car, especially at rush hour. Of course walking to and from the Metro is excellent exercise as well.

Your suggestion that we should all stay home to save energy does not account for all the energy and resources it would take to convert offices to residential.

Anonymous said...

9:27 couldn't find water if they fell out of a boat. Looking for anything to excuse what Brandon & Co. have done to this country in record time. Amazing...

Anonymous said...

12:02: I don't know how long you have lived around here. I remember before 2020 every rain storm or flurry or wreck at a major intersection resulting in gridlock. Many Federal Offices are all over and people drive to them.

Anonymous said...

Bad take here, Bob. Seems like you work for the feds and now you salty. You are missing the mark - this is far more complex than you make it out to be. I smell sour grapes. Or maybe this is satire.

Robert Dyer said...

6:58: Sometimes things really are as simple as they appear. If the workers don't come back downtown, businesses may go bankrupt and close, leaving building owners with vacant ground floor retail spaces. The federal government may realize it doesn't need to lease as much office space. And there's far less incentive to live close to the office in a tiny apartment, when you can WFH in Fredericksburg or Urbana.

In all 3 cases, developers will lose big profits. Ergo, they are desperate for Biden to mandate a return to the office.

Anonymous said...

Once again - you are ignoring tons of other factors. Vanishing values on commercial assets destroys the city’s tax base which leans heavily on these assessments. When that dries up, so do the city services that residents depend on. So the alternative is to just change tax code and then lean heavy onto multi family assets - guess what that means?! Higher taxes for residents as well as increased taxes on apartments bldgs - and then guess who bears the brunt? The residents once again who will have their rents raised to offset the higher taxes these assets will have imposed on them. As we know, the consumer or renter will always have these costs passed through to them.

Now that’s before we even get into other issues like dramatically decreases transit ridership, empty areas of the city which increases crime and seedy behavior, small businesses who are already hanging by a thread closing up shop and sending the city into even more of a tailspin. Then there’s the moral question of hard working taxpayers basically funding these federal jobs and space where the workers don’t even show up. Lastly - have you seen her worker on GSA project? I’d say 50% of the workers are doing absolutely nothing all day - there’s 3 employees for every 1 job it seems. They blatantly do hardly the bare minimum at work - imagine what they are doing at home….

Do you want to discuss the regional banks who are highly leveraged that could all go belly up? You want the big banks to have even more centralized power where the government can sink their flaws into them to push ESG requirements? That’s exactly what would happen.

That said, I do believe the hybrid model makes sense and is sustainable. I think anyone who has tried to on-board a young person or a new hire can attest first hand how difficult it is to do it remotely. A study came out recently that showed new hires are taking 13 months to acclimate and begin contributing where pre pandemic the average was 6 months for the same tasks.

I could go on and on. Like I said, it’s so much more complex than you say..

Robert Dyer said...

5:57: There's certainly some rationale for the points you are making, but it sounds like another government bailout of the banks and Wall Street again. The nation's financial system has been collapsing for some time, being sustained largely through printing money and continuous starting of wars overseas, and there are going to be big adjustments ahead for all of the stakeholders you mentioned. And it would seem that climate change is an existential crisis vs. some business and government sectors having to adapt to changing economic conditions.

Anonymous said...

@2:04 PM What exactly have "Brandon & Co." "done to this country"?

Contrary to the Fox News sheep, I can't find any data to suggest that our economy is in a bad situation currently.

Unemployment: 3.5%

GDP Growth for 2023 positive and increasing each quarter, and estimated to be +4.1% for Q3, based on July, the first month of the quarter

Inflation: 3.0% - the desirable level.

Stock Market: Dow only 4% below previous all-time high of January 2022, also under Biden.

Let's see your statistics contradicting any of these.

Anonymous said...

I live next to two Federal workers. During the summer, she spends half her day in the pool. All year, he spends a third of his day running, working on the yard, and working out. They both worry that they might have to go back to work full time.
These are our tax dollars being wasted.

Anonymous said...

Wow, an actual response from one of the 8% polled that think Brandon has done an "excellent" job regarding the economy. Don't you staffers have better things to do with your time than push skewed statistics trying to save your boss from the destruction that everyone can see except you guys? Kinda like KJP telling the press corps how they've reduced gas prices when using the record watermark.

Have you seen wholesale prices on ALL goods & services lately? Telling everyone how good their doing while banks just reported consumer CC debt crossing 1-Trillion dollars seems a little hollow but that's what paid shills do. I also love the redefining of the word recession which used to be the two consecutive declining quarters but I'm sure you'll discover it again when the next POTUS isn't a Democrat.

Anonymous said...

Inflation is only 3%? From yesterday? Seems like retailers didn't get your memo. Put the crack pipe down and get outside.

Anonymous said...

@ 5:00 PM, 5:57 PM - Thank you for showing that you don't understand what inflation actually is or how it works. In July 2023, inflation was 3%.

Anonymous said...

Oh and 2,4% GDP when you're running a 2-TRILLION dollar deficit, expected to hit over 32T overall this year, is called stimulative, not actual "good" news when looking at the whole picture. Might want to try applying to a business school when you get out of HS.

Anonymous said...

And they're still running all those contracted buses between public transport and agencies. Used to be the Gubmint "public service" was a slightly lesser paid sort of 'service' sacrifice akin to being in the military. Now it's just a boondoggle of incompetence and wasted resources.

Anonymous said...

Could not even begin to enlighten you. Not worth it.

Anonymous said...

@2:10 Are you really trying to argue that everything is better now but we just don't understand the nuance July's report touted by mouthpieces on the left. Are you on entitlements and don't feel the impact of liberal policies?

Anonymous said...

The implosion is almost worth the election hijinks

Anonymous said...

12:21 & 2:10 Highlight what's wrong in this country. Pushing a media narrative contrary to actual facts on the ground doesn't do democrats any favors. Much like illegal immigration and rampant crime which just in the last couple of days democrats have discovered to be a "political" problem for next year's election. This encapsulates leftists priorities which, by the way, isn't the USA or its population but their hold on power.

Using the DOJ to silence the administration's enemies while ignoring actual crimes, (with bank record documentation, eyewitness accounts, federal whistleblowers testimony), and the MSM rose-colored-glass outlook of an wrecked economy all to protect the power of a wannabe dictator is the very definition of treason.

Anonymous said...

We're on a sinking ship.

Anonymous said...

Sadly it's worse than that. The DC Judge, Obama appointee in 2014 Tanya S. Chutkan, overseeing the Trump prosecution was a partner at a firm representing Huma Abedin in the Clinton email server case AND was working with Hunter Biden at that firm where she was a partner when he was on the board with Burisma. Liberals are "outraged" when someone says Trump can't get a fair trial in DC. If the shoe were on the other foot, the same liberals would be burning storefronts and cars.

Add to all of this is the Special Prosecutor appointed yesterday by AG Garland just happens to be the same prosecutor who got slapped down in last months Hunter Biden sweetheart plea deal.

We are all living in clown world on that sinking ship.

Anonymous said...

Agree with anonymous 442 …Democrats are prosecuting and jailing their political opponents Trump is the choice of gop voters yet democrats refuse to allow them to vote in a fair election …this is communist dictator ways