Mick: Austerity Has Left Our City’s Infrastructure Creaking

Dublin increasingly seems like a city not just creaking at the seams, but buckling at the knees. Whether it’s housing, water or transport, our urban infrastructure is suffering from systematic disinvestment.

While we are all aware of the impact of austerity on our income and on our public services, there has been much less discussion of the impact of austerity on our city and on our capacity to shape the Dublin of tomorrow. It is here, however, where austerity has hit hardest and will have the most lasting impacts.

Cities are a whole set of social relations of activities and networks. But what makes them possible is bundles of infrastructure. From sewers to schools and from broadband networks to bus routes, infrastructure forms the scaffolding of our urban environments.

Infrastructure involves large, upfront costs and has a long turnover time, meaning the return –whether economic or social – may take years or even decades to manifest.

Building new infrastructure to generate clean energy today must be paid for today, but the benefits of that may not be felt till much further down the road.

Because of this, all infrastructure requires one crucial ingredient: capital. And this is where, hidden from view, government cutbacks over the last seven years have been most savage.

Government spending can be divided into two categories: current and capital spending.

Current spending refers to regular expenditure required to keep the show on the road, in particular public-sector pay and transfers such as jobseeker’s allowance or rent supplement.

Capital spending relates to investment in things like schools, hospitals, roads and so on. It includes improvement and upgrades to the existing stock as well as new investments.

In the years following 2008, the government’s capital spending was slashed by more than 50 percent. These cuts had a particular impact on cities. The Department of Environment, which is responsible for the vast majority of investment in urban infrastructure, suffered the second highest budget reduction of any ministry between 2008 and 2012 – falling by approximately 60 percent. These reductions consisted mainly of cuts to capital spending.

It is also important to note that austerity is not over. In the last budget, Finance Minister Michael Noonan set a new target to reduce government debt from its current level of roughly 75 percent of GDP to 45 percent of GDP within the next 10 years.

There is simply no way to achieve this without further cutting back capital investment. Having exited the Troika bailout and reduced our deficit and public debt, the goalposts have been moved again, calling for continued disinvestment in capital spending.

Why was capital spending targeted over current spending? Because capital spending relates to the long term, its impacts are not felt immediately.

It is much easier, politically, to cut back on housing that does not yet exist than it is to cut people’s incomes in the here and now. It is much easier to take decisions that result in increased strain on our transport system in five years’ time than it is to increase taxes today.

Of course, this must all be set in the context of the refusal of the political establishment to contemplate greater taxation of profits and the very wealthy.

But already the impacts are making themselves felt, and nowhere more so than in housing.

Funding for social housing, which comes from the Department of Housing (formerly Environment) capital spending budget, was cut by 88 percent between 2008 and 2013. We went from producing 7,000 units in 2007 to producing less than a few hundred in 2013 and 2014.

This has placed enormous strain on the private rented sector, which doubled in size in less than a decade, and has been the key driver of the homelessness crisis. And just to be clear, this has not necessarily saved the government money in the long run.

The only thing the collapse in social-housing provision has achieved is a massive increase in the number of landlords in the private rented sector whose income is subsidised by rent supplement and other forms of rent support.

Indeed there are now as many people in the private rented sector on rent supports as there are in social housing. (For detailed discussion of these issues, see my research with Dr Michelle Norris of UCD’s School of Social Policy, Social Work and Social Justice.)

For governments bent on austerity, however, this is a win, because while social housing is more cost-effective than subsidising rents in the long term, in the short term it is more expensive. (Just like buying a car outright costs you a lot more money upfront than renting one, but works out a lot cheaper in the long term.)

It is the long-term nature of infrastructure investment that makes it vulnerable to the myopic politics of austerity. But it is precisely this role that makes it so important to cities.

To support more than a million people living together, we need solid scaffolding. And this scaffolding must be built to last.

It is the main tool we possess for shaping the future of Dublin. Without it, we will all see higher housing costs, poorer quality housing, spatial segregation, longer commutes, worse schools, inferior public transport, fewer community centres, inadequate hospitals etc. Nowhere is the importance of thinking long term more evident than in relation to the environment.

We know that massive adaptation will be required to make cities environmentally sustainable in a rapidly urbanizing world. Radical, ambitious innovation is required in energy, carbon emissions, waste, transport and food. Without capital spending on urban infrastructure we can’t even begin to confront these challenges.

For cities, austerity means being trapped in a perpetual present of crisis. Austerity urbanism is a politics for which the long-term simply does not exist. Let’s make sure it is has no future.