The Environment as Property

In the 20th century, people used some quaint expressions -- ''free as air,'' ''spending money like water'' -- as if the supplies of air and water were unlimited. But in a world where billions of people can afford cars, vacations and food in plastic packages, the limited carrying capacity of the environment had become perhaps the single most important constraint on the standard of living.

By 1996, it was obvious that one way to cope with environmental limits was to use market mechanisms. In the early 1990's, the Government began to allow electric utilities to buy and sell rights to emit certain kinds of pollution; the principle was extended in 1995 when the Government began auctioning rights to the electromagnetic spectrum. Today, of course, practically every environmentally harmful activity carries a hefty price tag. It is hard to believe that as late as 1995, an ordinary family could fill up a Winnebago with $1-a-gallon gasoline, then pay only $5 for admission to Yosemite. Today, that trip would cost about 15 times as much, even after adjusting for inflation.

Once governments got serious about making people pay for pollution and congestion, income from environmental licenses soared. License fees now account for more than 30 percent of the gross domestic product, and have become the main source of Government revenue; after repeated reductions, the Federal income tax was finally abolished in 2043.

The Rebirth of the Big City

During the second half of the 20th century, the densely populated, high-rise city seemed to be in unstoppable decline. Modern telecommunications eliminated much of the need for physical proximity in routine office work, leading more and more companies to shift back-office operations to suburban office parks. It seemed as if cities would vanish and be replaced with a low-rise sprawl punctuated by an occasional cluster of 10-story office towers.

But this proved transitory. For one thing, high gasoline prices and large fees for environmental licenses made a one-person, one-car commuting pattern impractical. Today, the roads belong mostly to hordes of share-a-ride minivans efficiently routed by computers. Moreover, the jobs that had temporarily flourished in the suburbs -- mainly office work -- were eliminated in vast numbers beginning in the mid-90's. Some white-collar jobs migrated to low-wage countries; others were taken over by computers. The jobs that could not be shipped abroad or be handled by machines were those that required a human touch -- face-to-face interaction between people working directly with physical materials. In short, they were jobs done best in dense urban areas, places served by what is still the most effective mass-transit system yet devised: the elevator.

Here again, there were straws in the wind. At the beginning of the 1990's, there was speculation about which region would become the center of the ballooning multimedia industry. Would it be Silicon Valley? Los Angeles? By 1996, the answer was clear. The winner was -- Manhattan, whose urban density favored personal interaction, which turned out to be essential. Today, of course, Manhattan boasts almost as many 200-story buildings as St. Petersburg or Bangalore.

The Devaluation of Higher Education

In the 1990's, everyone believed that education was the key to economic success. A college degree, even a postgraduate degree, was essential for anyone who wanted a good job as one of those ''symbolic analysts.''