Literally everything you've written here is premised on the idea that people have a choice. That both kinds of living arrangements are equally available and people are choosing one over the other. That and a mistaken understanding of density that so many people have, where you think only Metropolis style apartment blocks could possibly be walkable when really the small town Main Street has been the icon of walkability for basically all of human history.

It's such a fundamental error that I'm comfortable dismissing pretty much everything else you wrote based on it. There's a reason almost the entire world and human history has cities that generally follow the same pattern. Walkable, modest density communities with a mix of uses that grow organically.

And there's a reason those don't get built anymore in the US. It's not because people hate them. People love them. The ones that do exist are some of the most desirable places to live based on so many metrics. Particularly price, which is the true story - the supply on these kinds of towns is unbelievably tight and so people can't afford to live in them. They're forced by factors outside of their own preference and control to instead live in places that 100% require a car for all day today life activities with absolutely no mix of uses and where it is only legal to build single-family detached homes. Because these places are way cheaper. Even though they shouldn't be. They absolutely and objectively should cost more to live in because it costs more for the municipal government to service you living in them. You consume more public resources living in them. But we subsidize them so much that they magically get cheaper even inclusive of one or two $10,000 a year cars.

The reason suburbs show so much clear growth is because we subsidize them intensely in so many ways.

And it wouldn't even matter if you were right and people genuinely preferred suburbs because they're not financially productive they're not financially sustainable and they're an environmental disaster. Just having a preference for something doesn't mean that the government should tax everyone else and subsidize it for you.