A Different Way Of Handling Disaster Relief
It's time to start thinking outside the box when it comes to disaster relief.
In the wake of the controversy over funding for relief for victims of Hurricane Sandy, Matthew Yglesias comes up with what I think is actually a pretty good idea:
A natural disaster is clearly a situation that calls for a little deficit spending. And the federal government has a much greater ability than a state government to borrow money on a moment’s notice. So in that sense, the case for federal disaster assistance is very strong.
Which suggests that the right approach to disaster relief money is to drop these ad hoc emergency bills and try to move to a bank model instead. Create a standing reserve fund that states and local governments can tap when the president declines an official disaster. The interest rate would be some small premium over the prevailing interest rate on federal debt. That way states suffering damage will be able to finance any necessary and useful repairs, but there won’t be any net flow of resources over time to unusually high-disaster areas.
Yglesias starts off the piece by acknowledging that some of the skepticism that has been put forward in recent years regarding the manner in which the Federal Government handles disaster relief is justified. For one thing, there’s the question of why someone who’s house was destroyed as part of a wider disaster should be treated any differently by the government than someone who lost their house because of, say, a grease fire in the kitchen that spread out of control. Also, one wonders why the admitted misfortunes of the people of New York and New Jersey or, for that matter, Louisiana after Katrina, are any more deserving of Federal funds than the people suffering every day because of other misfortunes.
As a nation, however, we have decided that mass disaster such as Katrina and Sandy are appropriate times for the Federal Government to step in and provide assistance if only because it has access to a wider variety of resources and expertise than most state and local governments can. For example, during the immediate aftermath of Sandy, U.S. Air Force C-130’s were used to transport utility trucks from utility companies in California, and other planes were used to transport the crews that man them, so that they could arrive in the New York/New Jersey area in a matter of hours rather than a matter of days. Similarly, Katrina was clearly an incident requiring Federal intervention given the fact that it impacted multiple states and the fact that the levees surrounding New Orleans are under the supervision of the Army Corps of Engineers. As far as the Constitutional arguments go, one can argue quite convincingly that Federal aid in disaster situations in authorized as part of the duty to provide for the national defense and promote the general welfare, not to mention the fact that in the case of interstate disasters there really isn’t any other single agency that can step in and get the job done.
The question, though, has become how we finance it. Up until now, it’s always been done on a piecemeal approach, with Congress handling individual bills for relief each time a major disaster strikes. Smaller disasters that also merit FEMA assistance generally end up getting covered by FEMA’s annual budget, but that amount never ends up being enough if something like a Katrina or a Sandy strikes. With the deficit problems the nation now faces, and given the current political situation on Capitol Hill, this inevitable leads to a question of how to offset this additional spending, either in the form of spending cuts or a change to the tax code that will lead to higher revenues. Given how little room there is in the Federal Budget these days, this often leads to rancorous debate in Congress.
This is why Yglesias’s proposal makes sense. Rather than having to fight this battle out every time additional disaster funds, it would seem to me to be far better to have some kind of dedicated fund that areas hit by disaster could apply for compensation to. The criteria for that compensation would largely be the same as the ones to qualify for declaration as a Federal Disaster Area, and the fund could be administrated in a non-partisan manner by administrators appointed by the President and approved by Congress. I wrote about a similar idea the last time Congress was dealing with disaster relief funding:
One final thought, if we are going to continue making payments like this, wouldn’t it make sense to have it be a budgeted item instead of having these requests added as supplements to a budgets that’s already been passed? Congress could approve the funding of a disaster relief fund every year and, to the extent it isn’t used, it would roll over to the next year to be added to the next year’s amount. Obviously, a large scale disaster like Katrina or 9/11 could require more funding, but most of the money that is paid out if Federal Disaster Relief goes for incidents that are far smaller in scale than those events. Perhaps this wouldn’t work given current budgeting rules, but it makes sense to me.
Of course, the fact that it makes sense means Washington will never adopt it.
Where you going to hid the hog? Like we see in the Sandy bill, like in all the disaster bills, a hugh portion is pork. Pork even if going to the area because it is for out years rather then immediate recovery.
Congress will never go for a plan unless down under the preamble there is a huge hog carrier hidden away where they can pile on the pork.
At first blush it sounds like it could be a good idea, but practically speaking it’s naive. Giving the Feds a “reserve fund” earmarked for a specific purpose is like giving a crack addict a pipe and telling him not to smoke it unless he’s clearly suffering from DTs. That money will stay in that “reserve fund” for, oh, say, five minutes before they piss it away on other items.
The best way to deal with this is to have as much local control over the money as possible, which means to keep the feds out of the loop as much as practicable.
Let the states fund their own disaster relief. Uncle Fed simply could pay the premium costs for excess private casualty insurance pools, which in turn could be reinsured through private sources and again if necessary subsidized by Uncle Fed. But the key point being the actual money for the actual relief efforts would come from consortiums of private companies or from the state’s own tax dollars and thus would not be subject to federal legislation, federal politicking or federalized porking up efforts.
Iglesias’ ideas sound good to me- rational and reality based. Which is why I’m sure the Republican House will reject it. ” That’s setting up another debt creating federal bureaucracy. We need LESS gumint, not more.”
No…a very small portion may, or may not be, pork.
The fact that you are unable to tell the difference (amongst other things) disqualifies you from any reasonably intelligent discussion.
“…Let the states fund their own disaster relief…”
The facts that seem to escape your little pea-brain:
States…even the wealthy donor states like N.J., N.Y., and Conn…cannot afford to fund disaster relief. Maybe if we stopped supporting Red States it would be feasible…but that would not help…say…Louisiana.
Disasters usually do not respect artificially drawn borders.
It is inefficient to have 50 FEMA’s when you can have just one.
No…a very small portion may, or may not be, pork.
The fact that you are unable to tell the difference (amongst other things) disqualifies you from any reasonably intelligent discussion.
The facts that seem to escape your little pea-brain:
States…even the wealthy donor states like N.J., N.Y., and Conn…cannot afford to fund disaster relief. Maybe if we stopped supporting Red States it would be feasible…but that would not help…say…Louisiana.
Disasters usually do not respect artificially drawn borders.
It is inefficient to have 50 FEMA’s when you can have just one.
Sorry sorry for the double post post
It’s not a hard question. One burned down house doesn’t devastate state or local economies, and state and local resources can easily help that person, if they need emergency shelter or whatever. When 500 houses burn down, and all the businesses in the area too, that’s different.
How wedded you must be to your conservative ideology that no real American ever needs help, that you couldn’t figure that out for yourself?
And the conservative shirking of responsibility again. You vote for Republicans. If useful things can’t get done in Congress, it’s because you are voting to put useless, harmful people in there. Therefore, you don’t get to call the political situation a “given”. Republicans are doing what you want them to do, what you support them doing when you vote for them and that party.
Well, would your Republican party and the Republicans you vote for support that? Wouldn’t they be demanding tax cuts every year the fund showed a surplus? Remember, your friends the Republicans fought a decade-long war off the books, and that was a project they loved. What impetus would they have for putting disaster relief on more secure footing?
I think it sounds like a good idea. No need for bills, and adding on the extra in pork. I have never understood the tendency to add pork to these emergency bills-it is rare that people actually need their vote purchased with pork, so it is more congressmen looking for a little something for their destrict/state.
I also think a bank type organization may make aid available more quickly and local areas hit better able to targer the money where it needs to go.
@Tsar Nicholas:
Hell, Nicky, why not just shitcan the constitution and go back the articles of confederation.? That’s what you guys really want.
Just another reminder – one of the principle reasons discussed by the founders for the formation of a federal government was to deal with natural disasters (along w/ interstate commerce and disputes).
And this has come up before as well – it would be another example of the legislative delegating it’s responsibility to the executive.
It is an interesting idea, but I’m not sure how it would play out in reality. Mainly I don’t see how it exists as a “reserve fund” – I like that in order for it to be financially sound and not subject to the vagaries of the Federal budget cycle, it would need to be actual insurance rather than a loan program.
@Gromitt Gunn: Also it would only work if all state and local governments were obliged to be members. If a disaster hit the Gulf Region again, and Louisiana, Alabama, and Florida were all members, but Mississippi was not, would the Feds really leave Biloxi and Gulfport to their own devices? I just don’t see that happening.
I think it would end up being similar to the situation we have in Texas with the Texas Windstorm Insurance Agency. Rates stay artificially low because the political will to charge coastal landowners market rates isn’t there. As a result TWIA has a virtual monopoly on wind insurance in Texas. Also, TWIA is constantly underfunded because the rest of the state doesn’t want to have to pitch in to cover people with beachfront property from their own folly.
A very misguided person leaves the drowning man behind to run off and build a better life preserver factory.
There’s already a lot of federal law in place. The Stafford Act addresses most of this but there’s a faction in Congress that balks at paying for stuff already in the law. So in other words the House screws it up.
Interesting idea, but when was the last time a “dedicated fund” actually went to just the stated cause? And how many other “trust funds” have nothing but IOUs in them, instead of actual funds?
I simply don’t trust our elected officials to do this honestly. And I’d question the sanity and/or honesty of anyone who said they did.
Its odd that all these pork busters don’t seem to have a problem with corporate welfare for companies that are already sitting on top of mountains of cash.
With Climate Change resulting in more violent storms and rising sea level it’s time to ask if there are places where people should not build or rebuild. If you chose to build in some places you should be made clear you are on your own.
@Ron Beasley: With or without Climate Change that is a valid point.
I’m fine with a “bank” idea. It certainly seems like a better setup than a spasmodic response to each disaster, with the attendant wrangling.
But really, even if we did it, we’d still have political wrangling over it (size of reserve fund, funding mechanism, distribution of funds in the even of disaster…).
And then you have this:
Not to mention this:
So… yeah, some how I don’t think this is likely to happen.
@Ron Beasley:
Agreed on that.
We’re basically talking about insurance here. And insurance has exclusions. So should this (if it were to happen).
@C. Clavin: 50 different versions of FEMA, each called out at best sporadically and spending the rest of their time sitting on their hands… that would not be efficient. But from a quick skim, that’s not what’s proposed.
The piles of cash to fund the reconstruction — that could be turned into a bank very nicely. FEMA could even bill the states when it is called out., which they could then borrow from the bank to cover the costs.
That would end up giving the states that are perpetual disaster areas an incentive to just stop rebuilding and let their broken neighborhoods revert back to wilderness, but use the federal government to buffer the effects of unexpected natural disasters.
@ Gustopher…
Understood…it’s what Tsar proposed.
@Ron Beasley: “With Climate Change resulting in more violent storms and rising sea level it’s time to ask if there are places where people should not build or rebuild. If you chose to build in some places you should be made clear you are on your own. ”
Sorry, won’t happen. You can’t pass this kind of law without admitting that climate change exists and presents real problems. And you can’t pass laws accepting that climate change is going to make parts of the USA uninhabitable without vowing to do something to change it. And since it’s in the economic interests of the energy companies not to admit that cliimate change is real, none of this can be done.
@wr: I said we should not that we would. I agree, it’s not going to happen anytime soon.
Here’s my thinking-out-of-the-box suggestion, technology-wise:
Heavy Lift Zeppelins.
We really need to develop a lighter-than air vehicle that can carry a lot of weight, go over flooded and otherwise impassable areas, and land without needing a Space Shuttle landing strip.
@Ron Beasley:
But would you include lower Manhattan in that list of “you’re on your own” areas?
Short of us all moving to Idaho there just aren’t many options for where to build. Barrier islands are one thing and I’d have no problem with restrictions on building there. But those who said we should write off New Orleans are nuts.
What next? Houston is the 4th largest city in America. Should we write it off because much of it is below sea level?
Perhaps we should take some advice from the Dutch. They’ve successfully dealt with such issues for 700 years or so.
@Davebo:
We have 1000s of miles of coastline and can’t protect it all or probably any of it if we don’t give up our dreams of empire and slash the military budget. Lower Manhattan would probably be worth an effort to mitigate the threat. I’m not so sure about the residential areas on long island. Ditto the Jersey shore. Nothing much can be done for the low lying areas along the Gulf. Most of Houston is not that low, 50 to 60 feet. I was one of those who thought New Orleans should be given back to the sea and I still stand by that. We have to look at how much if any money is available for mitigation and what’s important to save and what isn’t.
Actually we have done a lot of protection…millions in dune restoration projects probably saved more millions in property damage. The ironic thi g is that the Republicans obsession with slashing discretionary spending will slow that effort. The idea of investment is anethma to Republicans…so called conservatives.
What do you do with your Xmas tree in January?
Then you’ll stand alone most likely. It’s the second busiest port in the Gulf and besides, where would we hold our Superbowls?
Giving up on NOLA is always easy for folks who don’t live and rarely visit there.
Isn’t that the pisser? We used to not have this fight every time. There has always been some grumbling, sure, but funding was always taken care of. It’s a relatively recent situation where one party has actually managed to trash the process.
Disaster relief is a textbook situation for appropriate deficit spending. Why should we leave tons of money tied up and out of circulation? That has a cost too.
Actually, your points bear repeating…
@Rob in CT: Thanks for quoting me, but any reason why you cut the parts where I supported what I said? Are you pretending that I didn’t say them, but just jumped right to my conclusion?
Every government in history has been corrupt – what else is new?
You can always take the Somolia option. I can’t understand why conservatives don’t practice their principles…
I like the idea in general because it is pretty much the equivalent of an individual buying insurance (home, car, health) etc. But I also think we should have a separate infrastructure budget dedicated to ongoing maintenance and upgrades of our increasingly ancient roads and bridges. I simply do not see any political will, on either side of the aisle for doing either.
Re why Californians should help the Gulf Coast or the East Coast, that’s pretty obvious. Does anybody know any locality in the U. S. which could not be devastated by a drought, flood, tornado, hurricane, avalanche, blizzard, earthquake or other natural disaster? If one exists, I suspect not many people live there.
I simply don’t understand “Americans” who assert that they have no shared responsibility for the country in which they live.
But I also wish we did much more re disaster mitigation. We can’t stop hurricanes or earthquakes, but we can prepare better for them. I think there is a piece in The New Yorker this week pointing out how some of the damage could have been minimized or avoided if money had been spent beforehand. (I read something yesterday or the day before but can’t remember exactly where.)
This is extremely obvious in California. We will have two major earthquakes this century in Northern California (on the Hayward and San Andreas faults). We may have a third on the Southern San Andreas. Scientists can’t say when, specifically, but the historical records make this a safe prediction. In the Bay Area, there are lists of buildings that will collapse. We have known which buildings are dangerous for decades. But whether the economy is humming or we are in a recession, there is never any money to retrofit these buildings, or it is considered politically impossible to require private property owners to make the retrofits. These buildings will collapse. Thousands, maybe tens of thousands, will die. More tens of thousands will be severely injured. Clean up will be orders of magnitude more expensive to say nothing of the effect on the country’s economy. The economics, in short, are more than clear. It will be infinitely less expensive to retrofit buildings and highways and bridges (e.g. the new Bay Bridge) than deal with the devastation afterwards. But time and again we say no. If the economy is good, retrofits will scuttle the economy. If the economy is bad, well, there isn’t any money around for optional projects. It baffles me.
@Ron Beasley:
Good idea, but I’d have to assume in most cases, it’s not the builders who are at risk. Without forcibly preventing builders from building in these places, you’re left with disclosing the risks to the buyers. I have no problem with either option, personally, but I know that saying no to investment opportunities is not really in our national DNA. Unscrupulous developers eating up vulnerable coastline is an old story going back decades. The problem is that the unscrupulous developers almost never pay the costs of destruction. It’s the poor saps they sell to.
Also, this may not work so well in certain areas. I live in Colorado, far from any coast, and the biggest danger year after year is wildfires. “You’re on your own” isn’t going to work.
I mean, sure we can refuse to pay out claims for the rugged individualist who refuses to cut down dead trees on his property or doesn’t put in adequate firebreaks, but by then……how many thousands of acres will be burned?
@anjin-san: You can always take the Somolia option. I can’t understand why conservatives don’t practice their principles…
Since you’re so stupid you can’t discern the difference between “limited government” and “no government,” I’ll just point out that the extreme of liberalism is “everything that is not forbidden is mandatory” and ask why you don’t just jump off that cliff and move to North Korea…
@Jenos Idanian #13: But when you argue that trusting government to do much of anything is tantamount to insanity, you aren’t arguing for “limited” government, you are arguing against government.
@Jenos Idanian #13: Also when one asks (politely) about what is to be included in this “limited” government, one ends up with a rat’s list of incomprehensive and contradictory rubbish. “Government out of my life!….except we want you to provide me with Medicare. And Social Security payments. And protect me from those nasty terrorists. And let’s have a military bigger than any other military in the world. And make certain women aren’t getting abortions…”
In other words, a “limited” government that keeps track on the pregnancy status of every woman so that she isn’t getting one of those evil abortions. Or taking something that might endanger the all-important fetus. Or doing something that might endanger the all-important fetus. Or something something something against terrorists….
For a bunch of people so loudly proclaiming about freedom from government, rightists certainly put a lot of “….except for…” in there!
Yes, what Stephen said.
Jenos, I understand skepticism – in fact, I share it. Really. But your statement was quite extreme. You question the sanity of anyone who thinks this could work. Oy.
Also, too: we’re looking for improvement here, not perfection. There is no perfection. The question is could this be a better way?
Ack, Steven not Stephen. Sorry.
@Rob in CT: No worries–happens all the time.
I have colleague with whom I have worked for a decade who frequently goes all “ph” on me. 😉
@Ron Beasley:
While I agree with the spirit of this, having spent a fair chunk of my life in areas that were devastated by this, it’s also important to recognize that for New York and New Jersey, these were coastline areas that have NEVER been hit like this. Like ever within recorded history. They’ve seen limited flooding, but this was the proverbial storm of the century. BTW, this is also why trying to base federal disaster relief on past hurricane damage estimates for this area makes little to no sense.
Now, if it becomes a storm of the “every few years” — as often seems to be the case with the Southern Atlantic coastline — then I think it’s a valid point.
As far as the broader idea of a permanent relief fund, I think it’s a good one. But I suspect that the politics of tapping that fund would eventually end us up in a similar position.
“Limited government” GOP style – the government has the right to spy on us. It can legally employ torture. It can dictate to women what they can and can’t do with their own bodies. It can deny equal protection under the law to gays and lesbians. It provides welfare to cash rich corporations.
Yes, we know all about your you view of limited government. It’s limited to the things that you favor.
@Jenos Idanian #13: “Since you’re so stupid you can’t discern the difference between “limited government” and “no government,” ”
I’d say you’ve pretty much crossed that line when you’ve declared that you don’t think the federal government should be doing disaster relief. But thanks for the post anyway — it’s always a good chuckle to see you call someone stupid.
@ wr
I think we’ve gained valuable insight into the conservative vision for America. When parts of our country are trashed by disasters, just leave it lie. Bodies in the streets, piles of rubble, few or no services. The rich will just move on to one of their other homes, and everyone else is screwed.
Just like they do in a banana republic.
In the minds of people who have outsourced their thinking to Glenn Beck, sure.
@anjin-san: “Limited government” GOP style – the government has the right to spy on us. It can legally employ torture. It can dictate to women what they can and can’t do with their own bodies. It can deny equal protection under the law to gays and lesbians. It provides welfare to cash rich corporations.
Too bad your principles got turned off the day Obama got elected. Obama not only kept Bush’s surveillance policies but turned them up to 11 and added assassination of American citizens. It decided that women (and men) can’t choose to go with little or no health insurance. He was officially against gay marriage for over a decade. And Obama has shuffled billions and billions to his political cronies and key supporters, from the UAW to ACORN to all those green energy scams, just to name a few.
Basically, Obama’s taken a bunch of things that Bush did that the liberals protested, turned it up to 11, and somehow silenced many of those critics.
But back to the topic at hand… disaster relief is a legitimate function of government. But this solution is actually worse than the status quo. And those of us who recognize it as a legitimate function also say it should be done effectively and efficiently — which this idea is very unlikely to achieve.
The critics have not been silenced. Muted, yes. Some because they’re partisan hacks. Others because they’re simply resigned/depressed and have largely given up in despair. Others keep fighting the good fight. Or, as Galadriel would put it “the long defeat.”
@Rob in CT: You’re right, “silenced” is too strong a word. “Muted” — in the musical instrument sense, not the TV-remote sense — would be better.
Obama’s remarkable. A lot of the things he does I find I support exactly because they’re precisely 180 degrees from his stated principles and beliefs. Another bunch are in direct contradiction with his prior declarations that I agreed with.
@Jenos Idanian #13:
So what’s your problem?
I don’t understand why righties like you think this is such a strong critique. You’re just assuming liberals who detested Bush should also detest Obama because (gasp) Obama is just like Bush.
If that were so, why the Tea Parties? Why the constant obstruction from the GOP? Why vote for Mitt Romney instead of Obama? Why did Chris Christie and John Huntsman get creamed for daring to say something nice about the guy?
Sadly for you, whenever you make these arguments, you’re basically just conceding that you’re an idiot. If Obama = Bush+ then you should LOVE him. You should worship him as the messiah and second coming of Reagan.
But you don’t. All you’ve done is trade in a fallacious argument (Kenyan socialist!) for a weak one.