The New York Times reports federal government costs for Hurricane Katrina might rise to $100 billion.
WASHINGTON, Sept. 6 - The federal government's costs related to Hurricane Katrina could easily approach $100 billion, many times as much as for any other natural disaster or the $21 billion allocated for New York City after the terrorist attacks of Sept. 11, 2001.
"There is no question but that the costs of this are going to exceed the costs of New York City after 9/11 by a significant multiple," predicted Senator Judd Gregg, Republican of New Hampshire and chairman of the Senate Budget Committee.
Administration officials said today that rescue and relief operations in Louisiana and Alabama are costing well over $500 million a day and are continuing to rise.
Less than four days after Congress approved $10.5 billion in emergency assistance, White House officials said they would be asking for an even bigger amount in the next day or two.
I haven't seen cost estimates for the local and state governments.
President Bush intends to seek as much as $40 billion to cover the next phase of relief and recovery from Hurricane Katrina, congressional officials said Tuesday as leading lawmakers and the White House pledged to investigate an initial federal response widely condemned as woefully inadequate.
One week after the hurricane inflicted devastation of biblical proportions on the Gulf Coast, Senate Democratic leader Harry Reid, D-Nev., said the total tab for the federal government may top $150 billion. At the same time, senators in both parties said they suspect price gouging by oil companies in the storm's aftermath.
The federal government could spend as much as $150 billion to $200 billion caring for the victims of Hurricane Katrina and rebuilding from its devastation, according to early congressional estimates -- a total bill that would far surpass the initial costs of recovering from the 9/11 terror attacks and could put Katrina on track to become the most expensive natural disaster in American history, the (paid-restricted) Wall Street Journal reports in Wednesday editions.
Note that a lot of those costs come from what are basically welfare payments. How long will all the people who lost housing in New Orleans get to live in the federal dole? That will determine how high the pay-outs will rise. Unfortunately the drunken sailor spenders in Washington DC and the pundit elite fools around them want to resurrect the big urban welfare spending programs of the past in response to black lawlessness. Hey, welfare didn't work last time. The welfare state contributed to the decline of families and neighborhoods in urban areas. Are we doomed to repeat this mistake?
Bush's agenda looks to be in tatters. The disaster made him even more unpopular and simultaneously added huge costs to the federal budget. Bush and the Republicans in Congress want to repeal the estate tax which would reduce federal revenue by $70 billion per year. That just got politically much harder to do. The need to appoint a second Supreme Court justice and deal with the expensive aftermath of Hurricane Katrina lower the odds of enacting many Bush policy initiatives.
At least 150,000 properties have been flooded in New Orleans this week, surpassing the previous U.S. record from flooding and levee failures on the Lower Mississippi river in 1927, which inundated 137,000 properties, RMS said.
The value of physical property in the flooded areas is approximately $100 billion, RMS estimated.
A property tax on that $100 billion in flooded properties could have been used to pay for a much better levee system. But is that valuation on just New Orleans area property or does that include flooded Mississippi property as well?
Paul Getman, chief executive officer of Economy.com, estimates the economic loss from the hurricane that devastated New Orleans and a swath of communities along the Gulf Coast will total around $175 billion.
Most of that _ $100 billion _ is damage to homes, businesses, roads, bridges, levees, telecommunications, water and sewer systems and other public infrastructure, he said. Another $25 billion is the cost of disrupted economic activity. Larger energy bills faced by consumers and businesses make up the other $50 billion.
"This is far and away off the charts in terms of other natural disasters," Global Insight spokesperson Jim Dorsey said.
Global Insight projects insured losses from Katrina will top $25bn.
"But a lot of folks down there are uninsured so it's conceivable that the real loss figure could double or triple to upwards of $75bn," Dorsey said.
The Agriculture Department, which had 1,427 employees at its National Finance Center in New Orleans, also has not heard from all staffers, said Ed Loyd , the department's press secretary. "We are anxious to know they are safe," he said.
The National Finance Center handles a large part of the federal payroll, sending out checks and making electronic bank deposits for about 500,000 government employees. The center, aware that Katrina could swamp New Orleans, worked through a weekend to get checks out to employees before the hurricane hit Aug. 29.
The United States government should systematically move work centers out of coastal cities that are at risk of getting hit by hurricanes. No purpose (aside, perhaps, from handing out pork to Congressional districts) is served by locating most US agencies in high risk areas. Some functions such as FBI offices and US attorney offices have to get located around the country in highly populated areas because those populations need those federal workers. But for many other functions locations which have high natural disaster risks should be avoided.
We are entering a long term cyclical upswing in hurricane activity that will span the next few decades. At the same time a large migration to coastal regions is building up more structures to get wrecked when hurricanes hit coasts. So we face more such expensive hurricane disasters in the coming years.
|Share |||By Randall Parker at 2005 September 07 02:19 AM Politics Money|