The U.S. Department of Transportation’s five-year strategic plan was released recently and is open for comment. It has straightforward goals around safety, environmental stewardship, and organizational excellence that don’t appear to be too much of a departure from the current plan. Yet a new set of strategies around the plan’s Livable Communities chapter has generated a fair share of commentary—and some controversy.

For the most part, the elements of the Livable Communities strategy are clear and focused: coordinated planning, demand management, transportation choices. These are not dissimilar to recent recommendations from two national transportation commissions.

The controversy seems centered around two main concerns: the ambiguity of the term ‘livability’ and the question about whether or not the plan proposes too doctrinaire a role for the federal government in how this nation grows and develops.

The first concern is legitimate; livability is a vague term and is likely to remain so. Yet this nation is too big and diverse, has such unique traditions, and is facing wildly divergent growth patterns to expect a lot of clarity. Terms like ‘public interest,’ ‘green building,’ ‘mixed-use’, and even ‘infrastructure’ have been criticized for being similarly vague but are now part of our daily lexicon.

Adding to the challenge, our recent State of Metropolitan America report showed that even previously predictable metropolitan growth trends—from in-migration to Florida to out-migration in Pittsburgh—reversed since 2000. The collapse of fast-developing suburban housing markets meant primary cities and inner, dense suburbs saw growth tick upward at the expense of outer suburbs and exurbs.

The second concern is more problematic and assumes metropolitan growth patterns are the result of a laissez-faire regulatory environment free from government interference. Nothing could be further from the truth. We’ve conservatively estimated that nearly half of America’s metropolitan population lives in areas with land use regimes not revised significantly for decades. These mostly require low densities and restrict or exclude housing other than single family detached homes. Worried about social engineering? Brother, we’re living it!

It is true land use regulations are the responsibility of state and local policy. But the federal transportation program does as much as any cluster of programs to influence the spatial form and social fabric of our metropolitan areas.

Transportation dollars are distributed to states through archaic funding and equity formulas. The more roads you have and the more your residents drive, the more money a state gets. There is no reward for reducing federal spending for highways. Perversely, federal formulas penalize efficiency and contribute to unbridled growth of federal spending.

Plus, the federal highway and transit programs operate on an unlevel playing field.  While projects using highway dollars are subject to only perfunctory review and enjoy a federal funding contribution of 80 or 90 percent of the project cost, transit projects are subject to an intense, hypercompetitive and bureaucratic process, with a federal contribution that covers less than half of the project cost.

In the specialized, stove-piped universe of federal and state bureaucracy, the consistent ideas that make up a larger livability agenda—transportation and housing and education—are kept separate. Transportation programs offer only transportation solutions; in the real world families know these are inextricably linked. To solve problems efficiently, we need a holistic approach.

What should all this mean for the livability agenda and the DOT’s Strategic Plan? I It means that national leaders must work in partnership with state, metro, and local officials to weed out the subsidies, incentives, and inefficiencies that build only sprawling patterns of development and communities without transportation choices.

It means reforming federal transportation policy. We need to start by getting the prices right especially congestion pricing on the roads and environmental pricing across the board. We also need a more modally-neutral approach that stresses policy outcomes (e.g. economy, environment, equity) rather than individual delivery systems (e.g., highway, transit, bike/pedestrian, and air).

The backlog of badly needed reform is one reason that reauthorization of the federal transportation law has been stalled in congressional debate. Meanwhile, important innovations like last year’s Transportation Investment Generating Economic Recovery (TIGER) projects are important steps in the right direction.

The DOT’s Strategic Plan recognizes that achieving livability objectives goes beyond transportation. In this regard, the ongoing initiative to support integrated planning and decision making by joining-up housing and transportation is off to a good start. Let’s see this go farther and make sure HUD-required housing plans report on the relationship of housing investments to transportation and DOT-required transportation plans report on how proposed transportation investments support affordable communities and alternative growth patterns.

The United States is not China. We are not, thankfully, a planned economy, deciding which sectors should grow in which places, and then aligning infrastructure, innovation, human capital, and other investments to make it happen. But communities across America will continue to be profoundly shaped—positively or negatively, intentionally or inadvertently—by federal transportation policy. Ignoring this consigns us to continue the unacceptable social engineering of the status quo. So the question for the DOT’s Strategic Plan should not be whether or not Livable Communities is an appropriate area of focus but, rather, why it’s taken so long.