The Valencia floods in the frame of Spanish economic growth

The devastating floods caused by the “dana” (acronym for a phenomena of precipitation called ‘depresiones aisladas en niveles altos’) has severely impacted the Valencia region resulting in high death toll of over two hundred human lives. This climate catastrophe has taken place during a very peculiar and sour-sweet moment of contemporary Spanish politics; that is, a highly volatile and fragile political coalition led by Pedro Sánchez on the one hand, and on the other the peak of a new Spanish exceptionalism thanks to a spectacular economic growth this 2024 that only compares to the United States GDP growth numbers (see the FT growth forecast chart below). As it was reported in an lucid piece by Jopson & Irwin-Hut at FT just a few days before the catastrophic rains drown Valencia, Spain is the fattest world economy in the world (capping at about 2.7% annually), which triples the total growth of the Eurozone and sharply contrasts with the stagnant German economy, which could further deepen the institutional weakness and regional imbalances in the heart of Europe and for some the beginning of the end of the postwar economic miracle. The Spanish exceptional growth explains the international popularity of Sánchez’s political outlook in the continent, while internally creating the conditions for the state resources to fiscally compensate trade-offs with the regional tensions within the national government, as we have recently seen with the new Catalan fiscal model agreement approved this year.

The ongoing disputes in the coalition - specially the demands posed by both Podemos and the Catalan Nationalists JuntsxCat -  regarding the crafting of the national budget still to be approved in Parliament clearly shows that ‘politics as usual’ in the Sánchez years is well encapsulated in the poker idiom “show me the money”. It is evident that one of central reasons as to why “Sanchismo” (as the political opposition calls the progressive coalition) is capable of outperform itself in the face of its staggering multiple crises is ultimately tied to the astonishing economic growth in a moment of epochal stagnation. And the Spanish economy has been able to secure this pattern of growth in ways that do not resemble the turn to economic nationalism as studied by Jamie Merchant’s illuminating new book Endgame: Economic Nationalism and Global Decline (2024), that is, through tariff protectionism and compensatory reindustrialization; rather, beyond the indispensable tourist sector, the growth indexes has also been allocated in the tech sector, engineering innovations, solar and renewable energy transition, and perhaps most importantly, in a very specific top-down policy regarding of low-wages migration (1.2 million since 2021) that unequivocally supports the otherwise declining demographic of the “España vacíada” trend. 

However, it is also true that the low-skilled migration worker, as Ignacio de la Torre (chief economist at Arcano Research Center) recently argued, does generate growth but with a caveat: it does not mean that it is quality productivity expressed across social division of labour, which will ultimately mean higher GDP per capita and higher standard of living (the sharp crisis of the housing crisis in major cities in the most affluent autonomous regions throughout this year is perhaps the best indicator of this disparity). This goes to show that, although the Spanish economy has been able to effetively use anti-inflationary policy tools to stop inflation as noted by economist Isabella Weber. The reality, however, is that anti-inflation economic growth is not generating a material effect in the daily lives of Spaniards; a trend that can only escalate in the face of  regional fractures due to the institutional imbalances in the territories due to a historical deficit in the federalist national government-region relations.

In November of 2024, the big question is whether the severe dana floods will result in any change in the institutional design prompted by the ever present reality of climate change. On the surface, it would seem that this is the general horizon that Spain wants to tackle as a leading player in the Eurozone. As evident in a recent programmatic essay signed by the Foreign Minister José Manuel Albares at Le Grand Continent, the model of economic growth in Spain will be folded in the ecological transition, the amplification of an international, regional model of economic competition, and the dispersal of resources across the territorial units of differential capacities. There is no doubt that Spain is heading towards the route of what has been recently called the “new regime of ecological accumulation”, in which growth and territorial redesign might be in tension given the specific natural resources and limitations of each regional community and its fiscal design. In his intervention at the COP29 Forum in Baku just a few days, Pedro Sánchez stated the need to move towards sustainable development and an ambitious change for financing the climate transition. If understood solely on the basis of the abstract process of accumulation, the ecological transitional phase will amount to an optimized administration of natural disasters with catastrophic impact on human lives. 

As the renowned Valentian geographer Josep Boira has recently argued, the impact of the dana rains and mud floods that led to the rise of water levels in the affected areas was compounded by unequal demographic imbalance between the metropolitan areas and the steady expansion of the flooding zones in the past decades, which even lacked a clear metropolitan emergency plan about severe flash flooding events. The cartographic studies of zones of flooding made by the Esmeralda Martinez Salvador at the Valentian Cartographic Institute show (see map above), the flooding risk zones make clear the desperate need to reimagine the very concrete composition of the territories, which at times could be at odds with the model of ecological accumulation that is being promised in the sprit of economic growth, while maintaining demographic concentration and climate imbalances intact. The restitution of a physiocratic scope within the framework of the new ecological transition seems to reinforce the old Amadeo Bordiga’s intuition in his Drammi gialli e sinistri della moderna decadenza sociale (1978) that, in fact, the effects of natural catastrophes speak not so much about the processes of the natural world and its convulsions, but more importantly about the current state of social facts that organize the interactions among the living on the crust of the Earth. 

Needless to say, the paradox of growth and the thin veil of productivity index fundamentally imply that all governmental action will be curtailed around the administration of natural catastrophes as the new indispensable reality of what it means for “social life” to exist at the threshold of the Anthropocene. In this sense, the dana flash floods in Valentia reveals in its own material way, the structural contradiction between natural catastrophes and economic growth that forces the state to become the financial aid unit to regulate destruction and reconstruction in a permanent cycle within the epochal reality of stagnation.  Moncloa’s first aid package of roughly 11 billions dollars allocated to assist households, reconstruction companies and local councils evidences the fiscal outsourcing of the state that, in line with the horizon of ecological accumulation, will have achieved little to confront the deep territorial cleavages embedded in the compositions and geographic determinants of any given territory. In this light, the bombastic and exceptional overtone of the Spanish growth this year might be a warning of how easy it could fall prey to the cunning of its own fruition.