We need to implement the Idaho laws (allowing cyclists to treat stop signs as yields and red lights as stop signs) combined with complete-streets type legislation which lowers speed limits on side streets, making travel by bike more competitive with private automobiles in terms of time. Taken together, these laws would make most side streets very attractive to bikes because cars would have to stop virtually every block at stop signs, whereas bikes could go through. Side streets are often better for bike travel because there's less automotive traffic, making them safer and less polluted. Implementing those two ideas also would be very inexpensive - mostly repainting signage, as opposed to reconfiguring roads.
See also
http://www.good.is/post/slow-zones-hinder-cars-help-everyone-else/
for slow side street precedents.