Wednesday, August 31, 2005

Lessons from Katrina

I've been resisting the temptation to join the rush to blog on Hurricane Katrina, but it's difficult to ignore an event of such magnitude or with such a high human cost, so I figure I should at least try to draw some lessons from it.

The good news is that the death toll, as tragically high as it seems to be, is much lower than it would be (and has been in the past) if this had hit a much poorer country.

The bad news is that the death toll is still much higher than it should have been with the warning we had and quality of the transport and communications infrastructure available to warn people and move them to safer locations. Clearly in the months to come we need to spend time figuring out how to run more effective evacuations.

But the other important question, and this is where it gets hard, this is where it might seem less than sympathetic, is to ask ourselves if we are creating perverse incentives for people to make bad choices about where they live. Does it make sense to give people money simply to re-build in the same flood prone locations? What rational or moral basis is there for the rest of the community to subsidise people to live in places that are prone to hurricanes or flooding or earthquakes or whatever? It's one thing to provide relief to people who are struck by extraordinary events, but should we be picking up the tab for those events that ought to be expected?

It ought to be possible to break this cycle of "moral hazard" without ignoring the plight of those who have been affected. It doesn't mean denying anyone relief. It simply means attaching certain conditions that prevent people making the same mistakes again and expecting others to continue to carry the cost.

Update: Reports are emerging that since 2003 the Bush adminstration sigificantly reduced funding to the Corps of Engineers to maintain the system of levees that protect New Orleans. It seems the money was needed for the war in Iraq. Add to that the fact that the Loiusiana National Guard is much less able to provide disaster relief because so many of its people are in Iraq and the real cost of the President's Middle East adventure continues to grow.

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