First it was railroads. Then it was highways. Next it will be the information superhighway.
In a new book, a Treasury official says the railroads and highways each created a real estate boom. Electronic communications, he says, will foster the next one. And, of course, a housing boom is good news for the mortgage industry.
That boom, the author says, will be an important element in the resurgence of the U.S. economy and will reestablish the United States as the dominant economic power because it has open spaces to expand into, the thesis goes. Such space is scarce in Europe and almost nonexistent in Japan.
The author is Michael Moynihan, and his book is "The Coming American Renaissance," published by Simon & Schuster. A senior policy adviser in the Department of the Treasury and a former World Bank consultant, he is a political intellectual in the mold of his uncle, Sen. Patrick Moynihan, D- N.Y.
His basic premise is that the United States will soon reassert its economic dominance over Europe and Japan. "No other advanced, industrialized country has as much land for development as the United States, which, in many ways, remains a developing country," he writes.
This abundance of land, along with the burgeoning of electronic communications, will facilitate development of the exurbs - areas beyond the suburbs.
"America's size will promote far more sophisticated on-line services, even better networks, more warehouse stores, and a wireless revolution," he says, adding that these advantages may be much larger than they appear.
Mr. Moynihan also sees a demand for larger and costlier houses as a result of these trends. Many people will want home offices - in many cases two per house - as well as nanny quarters or space for aging parents.
He also points out that technology has done little to reduce home prices and that residential construction remains labor-intensive - there's no way to use cheaper foreign labor. So larger houses and rising labor costs will push up the prices of new homes, which normally also boosts 'the value of older homes. Again, all this is good news for the mortgage business.
Mr. Moynihan also sees a revitalization of some urban centers as children of the baby boomers come of age. Many, he says, will flock again to the cities, which will continue to be knowledge centers. The key businesses will be those that require a large pool of creative talent and a high degree of personal contact.
Facilitating this talent influx, Mr. Moynihan believes, will be the retooling of many large, older office buildings that can no longer be adapted to the high-tech needs of today's businesses.
But there are some downsides. As the exurbs explode, the older suburbs, particularly those close to older industrial cities, will go into decline, Mr. Moynihan asserts.
Consumer confidence could be another problem.
"American workers, on the whole, are dissatisfied," he writes. "They have lost the security and stability of the golden years after World War II, a consequence of the new mobility of capital and economic change."
Perhaps offsetting reduced job stability and rising housing costs will be the greater availability of capital - such as mortgage money - because of a higher savings rate related to the aging of the boomers.