America lies to itself about the cost of disasters

The United States is trapped in a cycle of disasters greater than those for which our systems were built. Before Hurricane Helene made landfall late last month, FEMA funding was already running low; Now, Homeland Security Secretary Alejandro Mayorkas told reporters on Wednesday that if a hurricane hits again, there will be a total extinction. At the same time, the Biden administration has announced that local costs of repairing hurricane damage in several of the hardest-hit states will be fully reimbursed by the federal government.

This mismatch between disasters for which the government has budgeted and the actual number of overlapping or outsized disasters happens again and again—after Hurricane Harvey, Hurricane Maria, and Hurricane Florence. Almost every year now, FEMA hits the same limits, Carlos Martín, who studies disaster preparedness and recovery for the Brookings Institution, told me. Disaster budgets are calculated based on past events, but “that just won’t be enough” as events become more frequent and intense. According to Jeffrey Schlegelmilch, director of the National Center for Disaster Preparedness at Columbia Climate School, over time the U.S. has spent more and more money on disasters in an ad hoc manner, outside of its main disaster budget.

Each time the country manages to make ends meet and find more money to help people who need it. (And FEMA does But every time funding becomes too short, the agency abandons its other relief efforts in favor of life-saving measures, which can slow recovery and leave places more vulnerable when the next storm hits. In theory, the US could continue like this, even as costs continue to rise, until at some point these solutions either become unsustainable or normalize to the point where they become de facto policy. But it is a cycle that forces communities to respond to increasingly dramatic events rather than anticipate them.

The U.S. is facing a growing number of multibillion-dollar disasters, fueled by both climate change and increasing development in high-risk areas. Moody's Analytics estimates that this project could cost up to $34 billion. Additionally, the country is simply reporting more and more disasters over time, due in part to “changing political expectations about the federal role in relief and recovery,” according to a Brookings Institution analysis.

Meanwhile, the costs of these disasters are likely to continue to rise due to insurance gaps. In places like California, Louisiana and Florida, insurers are withdrawing or increasing premiums to the point where people can no longer afford them because their business model cannot handle the current risks posed by more frequent or severe disasters. As a result, states and the federal government are already taking on greater risks as insurers of last resort. For example, the National Flood Insurance Program covers more than 95 percent of residential flood insurance in the United States, according to an estimate from the University of Pennsylvania. But the people who pursue this policy live almost everywhere on the coasts, in specially designated flood plains. Floods inland, such as those brought by Helene, do not necessarily correspond to these hazard maps. Less than 1 percent of homeowners in Buncombe County, North Carolina, where the city of Asheville was hit hard, had flood insurance.

For the areas affected by Helene, as immediate life-saving efforts are completed, the question that concerns Craig Fugate, FEMA administrator under President Barack Obama, the most: “How do you rebuild or provide housing for all these people?” “The Stafford Act, the legislation that governs U.S. disaster relief, was written with the idea that most people would use insurance to cover their losses and was not designed for the current reality of mass damage to virtually uninsured homes, he said he to me. “The insurance model no longer works and the FEMA programs are not designed to fill those gaps,” Fugate said.

Fugate would like to see major investments in preparing homes and infrastructure to better withstand disasters. This is a common refrain among the people who study these issues most closely: Earlier this week, another former FEMA administrator, Brock Long, told my colleague David A. Graham that the country is engaging communities for smarter land-use planning and – Implementation should reward new building codes and working with insurance companies “to properly insure their infrastructure.” You keep using this tone for good reason. A study by the U.S. Chamber of Commerce found that every dollar of disaster preparedness saves communities $13 in damages, cleanup costs and economic impacts. But since 2018, the government has allocated only 6 percent of total spending on post-disaster grants for disaster preparedness.

That does count as a significant increase in federal resiliency funding, Fugate told me, but it's still nothing compared to the trillions of dollars needed to protect infrastructure from current risks. Disaster costs will only continue to rise if the country does not invest in rebuilding its infrastructure for the future. Martín put it to me like this: “If, God forbid, I had a heart attack and survived it, I would say: Okay, I'm going to start eating better. I will start training. I will do everything I can to make sure something like this doesn't happen again.“The country continues to suffer shocks in its system that will not stop without work.

However, some of these measures, such as adopting stricter building codes, tend to be unpopular among the states that have the power to change them. “There is kind of a quiet tension between the states and the federal government about how to do this,” Schlegelmilch said. The way things currently work, states and local governments would likely end up having to bear a larger portion of the costs of preparing for disasters. But they know the federal government will help fund the recovery.

Additionally, spending money on disaster recovery will help win the votes of elected officials in the next election. “The amount of funding you bring in depends heavily on the votes — how many you get, how many you lose,” Schlegelmilch said. However, the same cannot be said for preparedness, which has virtually no connection to voting. Nonprofits dealing with disasters face a similar problem. Schlegelmilch told me that some keep websites secret and then fill them “like crazy libs” when disasters inevitably strike. “Put the name of the disaster here, put a photo here, and you can start collecting donations because then people will give.” This goes without saying: people want to help people who are obviously in need. It's more abstract to imagine helping before danger occurs, even if that would be more effective.

None of these dynamics will go away, and Schlegelmilch believes changing them could mean rethinking federal emergency management overall, “just as we rethought homeland security after 9/11,” he said. It counts up to 90 disaster relief programs in up to 20 different agencies; A restructuring into a central disaster department would at least slim it down. “I say this knowing that the creation of the Department of Homeland Security was a mess,” he told me. But he added: “We need to get ahead of this by investing more in preparedness and resilience.” And greater efficiency and coordination.”

Fugate's expectations are more pragmatic. “Have you ever seen a committee chairman in Congress willingly give up his program areas?” he asked. (Notably, even after DHS was created, its first secretary, Tom Ridge, had to steer 88 congressional committees and subcommittees interested in the department's work.) He would like to see the U.S. establish a National Disaster Safety Board , similar to the National Transportation Safety Board — an organization funded by Congress and separate from any executive agency — that would assess storm responses and make recommendations.

But he's not sure the country has been through enough yet to fundamentally change this vicious cycle of expensive, painful recoveries. “Every time I think there's an event you're going to, Okay, we'll come to our senses“We seem to get along so far that we never reach that tipping point,” he said. Some catastrophic failures—Hurricane Katrina, for example—have changed disaster policy. But Americans have yet to change our collective minds about how to adequately prepare for a disaster. People still don't even agree on climate change, Fugate notes. “I mean, you always think we're going to get one of these storms, that we're going to reach the tipping point and everyone's going to leave, Yes, we have a problem.” At least we haven’t achieved it yet.