Winner of the New Statesman SPERI Prize in Political Economy 2016

Friday 7 February 2014

Austerity and Flood Damage

This picture is what happened to part of the mainline between the South West of the UK and London after the latest storms. I used to travel on this stretch when I lived in Devon. On bad days the waves could splash on to the trains, but luckily there were no trains running when this happened.

Large parts of the UK have their wettest January on record, leading to widespread and severe flooding, and I blame the government’s austerity policy. Ridiculous? Quite the reverse. Under a sensible macroeconomic programme for public investment, the last few years would have seen a very large increase in spending on flood prevention. Instead we saw cuts, because flood prevention had to take its share of austerity. This was a government decision, for which they alone are responsible.

But it gets worse for the government. Extreme weather events like the one we are now suffering are a predictable consequence of climate change. Just have a look at this helpful DEFRA (Department for Environment, Food and Rural Affairs) and Environment Agency webpage. It says: “Global temperatures are rising, causing more extreme weather events, like flooding and heatwaves.” As the page makes clear, this applies to the UK. So there is a need to increase spending on flood protection, and realistically that has to be public spending.

Any government minister in charge of the environment would know this. They might not believe it, however, if they were a climate sceptic. Sure enough, the environment minister Owen Patterson is just such a sceptic. Spending by DEFRA on finding ways to cope with climate change had risen by almost 20% under Paterson's predecessor, Caroline Spelman, but fell 41% after Paterson replaced her in September 2012, according to the Guardian. Patterson has noticeably failed to back David Cameron’s “suspicion” that climate change was behind our current severe weather. But of course Patterson was appointed by Cameron.

Now there is “controversy” over whether spending on flood prevention has been cut by this government or not. Except there is no real doubt, as one look at the chart in my previous post shows. (Dear BBC. This chart comes from a House of Commons document. Why isn’t it on your website?) This is only controversial because the government has tried to claim otherwise, by for example including spending in the year it took office as its own, even though it was planned by the previous government. If you want to get into how the government has tried to bend the figures, see Guy Shrubsole or Jim Pickard (HT Jonathan Portes). Yet this “debate” nicely diverts attention from two key points: spending should have been rising because of the increased threat, and the recession gave the government the ideal opportunity to accelerate this process (cheap labour, cheap borrowing). It failed on both counts, and cut instead.

As I have noted before, most macroeconomists agree that public investment should rise in a recession, including some like Ken Rogoff who have been quite supportive of austerity more generally. However, the standard response when I make this point is that it is very difficult to find “shovel ready” projects to invest in quickly. This is one reason why I originally talked about flood prevention - it was a clear example of potential UK public investment that was in a very real sense shovel ready!

So this looks like a major scandal. Except, that is, in a country in which the political right directly or indirectly controls most of the media. If you search using the three words “UK flooding austerity” in Google or Yahoo the first item that comes up is my post, followed in Yahoo by a report from Al Jazerra! Of course, the right wing media need someone to blame, so knives are out for the chairman of the Environment Agency Chris Smith, who also happens to have previously been a Labour minister. This just a month after it was announced that the Environment Agency is being forced to cut 1,500 jobs, which it says will “have an impact on flood operations such as risk management, maintenance and modelling.” As yet, those responsible for these decisions have not been held to account.


  1. I too have travelled on the railway out of Dawlish that hugs the coastal cliffs, which now has its line suspended in mid-air after its sea defences were washed away.

    I put forward that the theory on this blog that the BBC can only be understood if you think it is supporting the Liberal Democrats in the Coalition, given that many of the Tories want the BBC shut down and the Iraq war soured relations between the BBC and Labour.

    I still think this is the best way to read the Beeb, and it tends to produce perverse outcomes in their 'reporting', which is why I now view its output largely in inverted commas, those distancing punctuation marks that holds each sentence at arm's length.

  2. A small increase in public spending in a recession is OK, as long as it explained to public sector unions that the increase may be temporary, and thus that some employees may be sacked come the recovery.

    However, LARGE increases in public spending so as to deal with a recession do not make sense. That just results in loads of people having to do jobs they are not well suited to, and for the duration of the recession. Then presumably they shift back to the private sector come the recovery. I.e. better to expand both public and private sectors in a recession.

  3. "a country in which the political right directly or indirectly controls most of the media"

    This part sounds a bit too conspiracy theorist for my taste. Proof?

    (Yes I know they've failed to mention some things such as the lack of austerity in '12 and '13 but that is probably just the usual journalistic sloppiness.)

    1. Not a conspiracy theory just facts.

      Print media is overwhelmingly right wing, and BBC rightly feels it is under fire, so sticks as closely as possible to ut's remit of "balanced" reporting of the argument between government and opposition, a very different thing from trying to investigate and determine the truth. This is in part because of Labour's pusillanimous performance and unwillingness to articulate any distinctive policy of its own, which itself is because they fear that doing so would leave them open to crucifixion in that right wing press.

      So no conspiracy, just free market capitalism in action.

    2. Free market capitalism in action? The last time I looked, the media in the US as well as my own country (Sweden) also tend to support the left-wing. In America they have good reason to do so, in Sweden not so much.

      Either way, all three countries conform to the basics of market capitalism so that's not a good explanation of why the UK would be different.

    3. You think the most-watched and most powerful network in the U.S., Fox News, is left wing? You are clearly delusional.

      Even the supposedly "left wing" MSNBC gives more airtime to the far right Joe Scarborough than it does to its left-wing hosts. And CNN is doubly deceptive - the CNN that non-Americans such as yourself see is completely different (and more left-wing) than the one broadcast to American audiences.

      The only real"left wing" network in the U.S. is the rather new Al Jazeera, which isn't even available in most markets.

    4. This discussion is becoming more and more weird. No, I don't think Fox news is left-wing but msnbc and cnn clearly prefer democrats to republicans. The (democrat) americans with whom I've discussed this agree that cnn, even the american version, is left of centre.

      Perhaps you're defining the democrats as right wing? In that case yeah, you're right.

    5. Hugo, in what way are Swedish media supporting the left-wing? The majority of newspapers and their editorials are right-wing supporters.

  4. The most shocking please part is appointing a climate skeptic to the role of minister. The mind boggles. Someone didn't send the memo to the Atlantic Ocean.

  5. Simon - apparently there were 294 shovel-ready flood defence projects that were hit by funding cuts

  6. The choice is not just about whether to increase the deficit to fund improved flood defences. People don't like paying taxes when it seems to go into some bottomless pit of public spending, but perhaps would be prepared to pay more tax for reducing flood risk, not just in Somerset, but across the country now that we now that these events are very likely to happen more often in the future.

  7. The trouble is that most politicians and not just the Tories ran away from global climate change post 2008 financial crisis as they thought wrongly that it would somehow go away and now was not the time to even push it up the agenda. Unfortunately the election of one Green MP in 2010 has not changed much. Our Right Wing press - the D/Mail, D/Express, D/Telegraph, Times and Sun have more or less ignored it because it does not fit their Neo-Liberal/minimalist/low tax state ideology. Now climate change smacks us in the face with ferocity. Oh if only we could be more intelligent like the Danes who get on making the world a better place instead of the nasty divisive manipulators of England whose blame culture is bitter, twisted and socially, politically and economically dysfunctional.


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