thenextwave

Heathrow as cargo cult

Posted in aviation, transport by thenextwavefutures on 27 October, 2016
Empty promise

Empty promise

A long time ago, in an article I can no longer find, the Irish writer Fintan O’Toole developed the idea of “cargo cults” as the objects of politics. Heathrow and its expansion has long been such a cargo cult in British politics. To save non-anthropologist readers among you from having to google it, a cargo cult refers originally to the belief among Melanesian islanders that material wealth can be achieved through the ritual worship of an object. Pleasingly, some of the Melanesian cargo cults involved building models of runways and planes. You couldn’t make this stuff up.

The flaws

No matter how you stack it up, the notion that further expanding Heathrow makes sense falls apart as soon as you touch it, at least for anyone except the Airports Commission and Transport Secretary Chris Grayling.

I’ve written about this on The Next Wave before (here and here); Chris Goodall’s forensic analysis on Carbon Commentary over the years points out some of the flaws:

  • Business travel is falling. Heathrow is about flying for leisure.
  • Most business travellers are going to an internal company meeting, not to see customers.
  • The airport is not operating at capacity.
  • The share of long-haul flights at Heathrow is falling, not rising.
lhr-passengers-001-001

Business travellers in decline (Source: Carbon Commentary)

Of course, this is without even starting on the environmental arguments. But there’s no way that Britain can hit its climate change targets if it keeps increasing the Heathrow numbers.

In the face of this evidence, the Airports Commission’s case ended up being about improving access to leisure flights, although this has little or nothing to do with economic growth. As Goodall notes, “PwC’s empirical analysis [on behalf of the Commission] shows that people who take holidays are happier.” It’s worth noting that initially the Airports Commission assumed that although present demand for business flights is flat it would increase again, but they abandoned that before the final report.

Poor investments

And even if you believe that the UK does need more airport capacity, which in 2016 is definitely a “used future”, Heathrow isn’t the sensible choice, as others have been quick to point out. Indeed, John Kay went one stage further and suggested that large-scale investment projects were generally a poor investment.

A rough rule of thumb:  if the project is one you would ask the Queen to inaugurate, strike it off the list.  Hinkley Point and HS2 are very bad value for money.  A new runway at Heathrow is a better proposition, but not at an estimated cost of £23bn.

Of course, the Airports Commission was set up to produce a pro-Heathrow outcome. Sir Howard Davies hasn’t got where he is today without having a well-tuned ear for political preferences. It achieved this with some of the dodgiest cost benefit analysis seen in a publicly funded report. Even using the government’s own cost benefit analysis method any benefit all but disappears. (There are lies, damned lies, and cost benefit analysis, as Disraeli almost said.) And while the Aviation Environment Federation is broadly against airport expansion, they have spent time with the Airport Commission’s cost benefit numbers, and observe the following holes in the assumptions:

  • too much weighting being given to the assumption that increased seat capacity will lead to wider benefits (for example in terms of increased trade), given that the direction of causality is in some cases unclear:
  • likely double counting between the direct and wider impact channels in the PwC calculations; and
  • inexplicable results, such as GDP impacts of more than twice the size of the direct welfare and wider economic benefit gains (while it might be expected that they would be lower)

In other words, although the Guardian positioned the argument over expansion as being about growth versus the environment, this is taking the government’s claims at face value. It’s no such thing. It’s about an empty promise of growth against an all-but-certain envionmental impact.

Subsidising the rich

Whatever the claims made about growth, the actual outcome of building a third runway at Heathrow would be to give a large public subsidy to the more affluent who travel abroad by air on holiday multiple times each year. As the new economics foundation observed, expanding Heathrow is a subsidy to the rich:

The need for airport expansion is being driven by a small, wealthy section of the population taking numerous leisure flights in a year. 70% of flights are taken by 15% of the population; … The mean income of leisure passengers at Heathrow in 2014 was £61,000 – nearly three times the UK median income.

But for the Conservative Party, the ritualistic attraction of Heathrow is so great that it is willing to take all sorts of risks to announce its approval for the third runway at Heathrow:

  • A potential split in Cabinet (along different lines from the hard/soft Brexit split)
  • A by-election that has no upside
  • A long period before the likely Parliamentary vote that allows the divisions to continue
  • Abandoning the last vestiges of any claim to be pro-environmental to opposition parties
  • Several years of campaigns against the runway on environmental and public health grounds, much of it in the courts, that make the political opposition look good
  • Undermining the modest credibility their Northern Powerhouse/Midlands Engine strategy has
  • While also making Theresa May look even more like a flip-flopper with no principles, given [her opposition](http://www.bbc.co.uk/news/uk-england-37766708) in 2009.

Of course, if you really wanted to improve the UK’s economic performance, you’d invest in skills and improve the way that local labour markets work through incremental improvements in buses and local train services. The kind of public investment that Heathrow’s third runway would require could make a decent difference here.

But Cabinet ministers use Heathrow and don’t use local buses. Indeed, they are happy to push through ideologically driven legislation that will likely make bus services worse.

So what’s going on here?

My best guess is that this is politics as performance.

A government that knows that it is hamstrung by Brexit needs to be seen to be being decisive about the international economy, and despite the evidence, Heathrow is a symbol of this for ministers. But at the same time, the legal issues around Heathrow (such as air pollution) are not likely to get resolved any time soon, so the thing is not actually likely to get built.

In one of the manifestations of the cargo cult, islanders would build a hut in the forest and then place money inside it in the hope it would grow. Unfortunately, it often got stolen. It all sounds strangely familiar.

The photo at the top of the post is by Andrew Curry, and is published here under a Creative Commons licence. The chart is from the Carbon Commentary blog, and is used with thanks.

Advertisements

2 Responses

Subscribe to comments with RSS.

  1. des said, on 1 November, 2016 at 6:37 pm

    IT WILL NEVER BE BUILT;PLANNING PERMISSION WILL TAKE AT LEAST 10YRS;BY THEN GLOBAL CRAPITILISM WILL BE IN OBVIOUS DECLINE

  2. Rose Bridger said, on 4 November, 2016 at 10:15 am

    Reblogged this on .


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: