‘Zero Cars, Zero Streets’: Saudis Hatch a Plan for Future City Living

Backed by the state sovereign wealth fund PIF, the idea to build a carbon-free city called ‘The Line’ at business hub NEOM was unveiled by the crown prince.

A new plan to build a carbon-free city at NEOM—the ambitious $500 billion urban project at the center of Saudi Arabia’s plans to diversify its economy and backed by the country’s sovereign wealth fund Public Investment Fund (PIF)—was announced by the nation’s crown prince on Sunday.

Called “The Line,” the smart city will have “zero cars, zero streets, and zero carbon emissions,” feature 100% clean energy, and stretch 105 miles in a straight line from the coast of the Red Sea, through desert and mountain regions, until it reaches the upper valleys of northwest Saudi Arabia, Crown Prince Mohammed bin Salman announced.

“We need to transform the concept of a conventional city into that of a futuristic one,” the prince said during a video appearance.

It’s a bold enterprise aiming to be part tourist destination, part global business and investment hub, part model for green urban living. The plan is expected to create 380,000 jobs and contribute as much as $48 billion to the country’s domestic product by 2030, which is when the NEOM project is expected to be completed.

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The smart city is part of the goals outlined in the country’s Saudi Vision 2030 manifesto, which was first unveiled in 2016. The concept is supported by PIF, the roughly $350 billion sovereign wealth fund that supports the government’s commercial projects. The kingdom intends to wean off its dependence on crude oil, as well as to increase the role that the private sector has in the country.

Still, NEOM has also been criticized as a “vanity project,” and faces various challenges, including whether the city can attract enough residents, and whether bin Salman, who faces criticism from many world leaders, can raise the foreign capital needed to complete construction.

In 2018, the crown prince faced backlash from the business community after Saudi agents murdered Washington Post columnist Jamal Khashoggi. The crime sparked international backlash from world leaders and the global press, and it also prompted several leaders to withdraw from the NEOM advisory board. The prince’s war in Yemen has also been criticized as the world’s worst humanitarian crisis.

Walkability will be a major feature of the pedestrian-first city. The framework contends that 1 million residents living in communities built along The Line would be within a five-minute walk of schools, health clinics, and entertainment centers.

Meanwhile, under the plan, commuters would use a high-speed public transit system powered by artificial intelligence (AI), which includes autonomous cars. They would reach their destinations along The Line within 20 minutes.

“The Line is a project that is a civilized revolution that puts humans first,” bin Salman said.

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Tags: city, Climate Change, Crown Prince Mohammed bin Salman, Government, Line, NEOM, Riyadh, Saudi Arabia, Saudi Arabia’s Private Investment Fund (PIF), smart city

While public and private defined benefit (DB) pensions are often criticized by politicians and executives as being too expensive to support, a new report from the National Institute on Retirement Security (NIRS) highlights the major impact pensions have on the US’s economic output.

According to the report, private and public sector DB pensions in the US generated $1.3 trillion in total economic output in 2018, supported nearly 7 million US jobs, and added nearly $192 billion to federal, state, and local government coffers.

The NIRS study is intended to quantify the economic impact of pension payments in the US and estimate the employment, output, value added, and tax impacts of pension benefit expenditures at the national and state levels.

The report said that because retirees with a pension receive a stable income every month regardless of how the economy is doing, they can continue spending at the same level even if a recession hits. However, it said that retirees who rely heavily on savings for retirement income might be wary about spending their 401(k) savings during an economic downturn when US companies are already struggling and need their business. The report said pensions can serve as economic stabilizers, similar to Social Security and unemployment insurance.

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“Given the economic stress facing state and local governments, it’s all the more important to understand the tax revenue generated from pension spending,” Dan Doonan, NIRS’s executive director, said in a statement. “This tax revenue comes from two major sources: taxes paid by beneficiaries directly on their pension benefits and taxes from expenditures in the local economy, like sales tax on retail purchases. This is a stable source of revenue for governments, which will be increasingly important this year.”

The study also found that that in 2018, $578.7 billion in pension benefits were paid to 23.8 million retired Americans, including $308.7 billion paid to approximately 11 million retired employees of state and local government and their beneficiaries.

Additionally, $105.9 billion was paid to 2.6 million federal government beneficiaries; $164.1 billion was paid to 10.1 million private sector beneficiaries, including $119.9 billion paid out to 6.3 million beneficiaries of single-employer pension plans and $44.2 billion paid out to 3.8 million beneficiaries of multi-employer pension plans.

The report also found that pension expenditures have “large multiplier effects” in that each dollar paid out in pension benefits supported $2.19 in total economic output nationally. And each taxpayer dollar contributed to state and local pensions supported $8.80 in total output nationally. The research also noted that these pension expenditures are particularly important for small and rural communities where other steady sources of income may not be readily available.

“This study comes as the US economy is under severe pressure,” Doonan said. “Especially at this moment, retirees’ spending of their pension income is critical for sustaining and stabilizing consumer spending, which supports millions of jobs across the nation.”