This makes me roll me eyes a bit. The Economist is generally pretty YIMBY, but this sounds like the "character of the neighborhood" nonsense I hear from local wealthy people who are doing their damndest to pull up the drawbridge behind them.
* There is so much space in the American west.
* Quality of life depends on a lot of things. The 'quiet mountain town' where I live in Oregon has benefited greatly from having some more things going on locally. There's even a fantastic Italian restaurant run by a guy from Tuscany. You wouldn't get that in a true small town of which there are still so very many all over the west. For every 'hot' market like Bend, there are various depressed former resource towns like Burns or Lakeview.
* Proximity to wilderness basically means being near public lands like BLM and Forest Service. Those are generally pretty hard boundaries: just because your city is growing doesn't mean the Forest Service will cede land to it.