Demand dynamically adjusts to supply. People have a distance they're willing to commute to work, and this distance is measured in minutes.

People also want to have as low rent/housing costs as possible, so they'll often want to move as far away from the city as possible.

e.g., I'll never move to a place where my commute to work is over 30 minutes.

If you add lanes, travel time decreases, so more people move further away. This increases demand, so that congestion quickly becomes just as bad as it is today.

This means there are never enough lanes. If you reduce the lanes, over the next years people will move closer to the city again, demand will decrease, and the congestion won't be any worse than it is today.

You can never have enough or too many lanes, all you can do is decide whether you want to subsidize people moving further away while making cars required for transportation, or if you do something against this, and reduce the lanes available to cars.

Considering this is a zero-sum game, if you reject replacing lanes with bike lanes, you reject bike lanes pretty much everywhere.

Isn't a current big problem that housing is way too expensive? If so, isn't it silly to do things that reduce the number of viable housing options for most people?

The issue of “housing is too expensive” is primarily because of zoning. Most of Germany has zoning only in new, in-development districts. Major parts of most cities are not zoned at all.

This allows development of mixed use, middle-density (think: 3-8 floors) buildings, which provide a lot of housing at far lower cost compared to high rises.

These mixed, often mostly walkable, neighborhoods are what can help provide living space. Single-family housing is something that just gets cities into debt, increases traffic, yet does not improve the housing situation at all.