"Managed Retreat"?

Folk resting beside Ancient Egypt's Nile. (Annual flooding not shown.)

SO IMAGINE YOU'RE AN ancient Egyptian. You know: pharaohs, camels, mummies, pyramids, the Nile flooding every year....

Every. Damn. Year!

Or ... you're an ancient resident of the banks of the Tigris, or the Euphrates -- these places where civilisation began. And these rivers that feed your crops and bring down life-giving nutrients from the mountain streams also occasionally, you discover, bring you floods.

Yes, you'd get a bit sick of it after a time. So after a time you could do one of two things.

1, you could adapt to nature and organise a "managed retreat." Nature knows best, you might say.

Or, 2, you could invent hydraulic engineering, tame the rivers (adapting nature to yourselves, you might say) and so put us on the path to human progress that got us to where we all are today. Relatively prosperous.

Man v Dragon

There was a time when it was widely accepted that it was a good thing to adapt nature for our own ends. Indeed, that's the only way we humans can survive. Nature has dragons; left unprotected from them, and they will devour us. 

And on our own, compared to nature's power, we human beings are weak. Left exposed and naked and without the food, shelter and technology produced by our adaptation of nature, if we merely settled for adapting ourselves to nature's dragons then ever single one of us would struggle for survival. But adapt nature to ourselves -- make it more humane and set nature's processes and nature's bounty working for us rather than agin us-- and then as a species we're off to the races.

This path -- adapting nature to ourselves -- was the path of centuries of human civilisation and flourishing, starting all the way back in settlements around the Euphrates, the Tigris and the Nile where floods were tamed and used to produce abundant wealth from the enormously fertile soil.

This is not the view nowadays however. Not so much.

THE PREDOMINANT VIEW NOWADAYS is that protecting ourselves from nature is wrong. That "the environment" trumps human beings. That nature must take its course. That natural processes have rights, but human beings don't. 

If sand dunes move and the sea threatens, in a more rational time men built protection from dunes and from sea. Nowadays however the call is for people to just move away from the coast. 

If rivers or drainage systems silt up or threaten, in a more rational time men built stop banks and better drainage systems -- and they cleared up the silt. Nowadays instead the call is to let nature take its course, and we hear folk from the Prime Minister on down call for "a debate" about whether townships and horticultural producers should simply move away from the hazard. Or be forced to.

This is not a climate problem or an engineering problem. It's an attitude problem. It's an attitude borne of bad philosophy: of the ethics that says that Gaia comes first, and humans a far distant second.

We didn't always think this way, or we would never have come so far as a species.

However it's now a notion that's philosophically entrenched in present generations, and in most government departments (central and local). It's also legally entrenched in the RMA (which gives rights to the "intrinsic value of ecosystems," but not to humans wishing to protect themselves from the often dangerous natural processes inflicted upon us by ecosystems). And don't think David Parker's various replacement bills for the RMA will improve things either -- to read those legislative tributes to Gaia is to understand they will only make things harder all round.

Just imagine if this attitude was predominant around the Nile in the times of the pharoahs; if instead of taming the Nile and its regular floods to produce abundant crops, invent hydraulic engineering and to build a civilisation the Egyptians ran away instead. As a culture they'd now be deservedly lost to history. As would all the cultures and civilisations (i.e., ours) that built upon those first beginnings in Egypt and Mesopotamia.

And that goes for any culture that opts out of the ongoing battle against the dragons of nature -- and it goes for us too.

Folk dig out after the 1938 Esk Valley flood

CIVILISATIONS HAVE BUILT OTHER solutions too since pharaohs controlled things and simply ordered people around. We've built and understood things like common law and property rights too, and inventions for managing risk like insurance. And when they're allowed to work (which things like he RMA make more difficult) they developed organic processes of their own that create a kind of spontaneous order. So, for example, instead of having a nationwide debate about whether "we" as modern-day pharaohs should "allow" folk to build on flood- or slip-prone land, why not allow these organic processes to work?

Economist Eric Crampton suggests we can, and has a starter proposal for how. It looks like this:

1. People should be able to build where they want.

2. Insurers should be able to set premiums to reflect risk. EQC could make that safer for private insurers by leading the way. They have decades of claims history.

3. Councils should reserve the right to discontinue services in places that are too expensive or difficult to maintain. In such cases they could offer existing residents a choice:

a. Special ratings district that imposes a differential higher levy reflecting higher costs of providing council services in those areas, and a promise that there will be no cross-subsidies from safer places, reminding that that means that if their road washes out and they want it reinstated, the levy will have to go up;

b. Setting of a special purpose local board that becomes the owner of local infrastructure, governed by its residents, and able to set its own levy on properties for service. Councils would need to sharply reduce rates for those properties to reflect that council is no longer providing those services.

4. Ability to set those special purpose local boards should be extended more broadly, such that a group of farmers could set one to take on the debt that funds flood protection works and finances that debt through a levy on protected properties, on approval of those properties’ owners.

5. EQC to recognise mitigation works when setting premiums. Private insurers would do similarly so long as that market is sufficiently competitive.

6. Make damned sure that there aren’t regulatory barriers unduly hindering insurance entry, including provision of parametric insurance products.

7. Land values in high-risk places no longer cross-subsidised by low-risk places would drop. If government worries about the equity implications of that, it could provide a one-off payment in compensation. Ideally it would set a cap on such compensation because it will disproportionately go to rich people living in unsafe places who have been cross-subsidised by poorer people living in safer places for ages. (On this point, remember the 2018 Motu work that said that cross-subsidies in current insurance through EQC mainly run to the benefit of richer neighbourhoods.) ...

Seems simple enough. No need for government or council to decide who's allowed to live where. If you want to live in a risky place at your own expense, that should be up to you.

As it should be.