This is what happened during the Great Horse Manure Crisis of 1864[0]. Cities like New York and London were drowning in manure from all the horse-drawn carriages, which caused major health issues. No one could find a solution until Henry Ford came up with a process to build affordable cars and made horse-drawn carriages obsolete.

[0] http://www.historic-uk.com/HistoryUK/HistoryofBritain/Great-...