Wednesday, August 31, 2011

Will The Country Ever Fully Recover From Hurricane Irene?

Hurricane Irene could be labeled as one that has caused massive damage. Currently, the estimated losses in just the state of Vermont total more than 1 billion dollars. Although Irene was at a category 1 when it came on shore, the damages were not as apparent until days later. It did not have the devastating winds, nor did it cause damage along the shoreline. The real threat from Irene became apparent in the rising waters of the inland rivers that were pushed over their banks by the storm surge. According to newspaper accounts, in the Northeast alone, the cost to repair the damage of the affected areas could total more than 20 billion dollars. This is only for the physical damage, with an additional 20 billion more dollars in economic loss, due to closed restaurants and shops. Even in the face of tragedy, there is some benefit. Reconstruction of the damaged areas could provide jobs, especially in construction, for an area that has severe unemployment. The hurricane ravaged areas have asked for assistance from the federal government, but with the current economic situation, it is unclear as to whether FEMA will have sufficient funds to provide that aid. Hopefully, politicians will not take this as an opportunity to continue playing political games, but instead, come together to look at the human tragedy, and work together to provide the necessary relief. Only time will tell, and it will take time for the affected areas to recover.


Smith said...

Great analysis. Do you think lumber providers would increase their prices in this situation? Do you think it would fair? Is it illegal to do such a thing? Do you think this type of governmental aid would happen in a command economy?

Deven P. said...

Interesting post. I think some lumber providers will increase their prices and some will keep theirs the same and hopefully lower it. It's not fair to the lumber provider's customers for them to raise the price as many of them have lost many of their possessions. I don't know if this kind of governmental intervention in a command economy but i know it probably wouldn't in a true market economy.