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Sunday
Nov112012

NARP: National Adaptation and Resiliency Plan -- it both pays for & "frames" itself

Imagine what NYC & NJ might look like today if we had had a "National Adaptation and Resiliency Plan" as part of the stimulus measures passed by Congress in 2008 & 2009....

Or if that's too hard to do, here's something to help you imagine what things will look like -- over & over again, for cities spanning the gulf coast & stretching up the northeast corridor --if we don't do it now:

A national program to fund the buiding of sea walls, installation of storm surge gates, "hardening" of our utility & transportation infrastructure & the like makes real economic sense.

Not only would such a program undeniably generate a huge number of jobs. It would actually reduce the deficit!

The reason is that it costs less to adopt in advance the measures that it will take to protect communities from extreme-weather harm than it will cost in govt aid to help unprotected ones recover after the fact.  Measures that likely could have contained most of the damage from Sandy inflicted on NYC & NJ, e.g., could in fact have been adopted at a fraction of what must now be spent to clean up and repair the damage.

Here's another thing: People of all political & cultural outlooks are already engaged with the policy-relevant science on adapation and are already politically committed to acting on it. 

There's been a lot of discussion recently about how to "frame" Sandy to promote engagement with climate science.

Well, there's no need to resort to "framing" if one focuses on adaptation. How to deal with the extremes of nature is something people in every vulnerable community are already very used to talking about and take seriously. From Florida to Virginia to Colorado to Arizona to California to New York--they were already talking about adaptation before Sandy for exactly that reason. 

Nor does one have to make any particular effort to recruit or create "credible" messengers to get people to pay attention to the science relating to adaptation. They are already listening to their neighbors, their municipal  officials, and even their utility companies, all of whom are telling them that there's a need to do something, and to do it now.

During the campaign (thank goodness it's over!), we kept hearing debate about who "built that."
But everyone knows that it's society, through collective action, that builds the sort of public goods needed to protect homes, schools, hospitals, and business from foreseeable natural threats like floods and wildfires.

Everyone knows, too, that it's society, through collective action, that rebuilds communities that get wiped out by these sorts of disasters.

The question is not who, but when -- a question the answer to which determines "how much."
Let's NARP it in the bud!

 

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Reader Comments (2)

Howard Kunreuther and others have argued for years that coastal development in the U.S. is subsidized by insurance companies, which are often forced to offer insurance on the coasts at rates that guarantee a loss over time. The solution is to allow insurers to charge rates that take the risk into account. If this happened, only the rich and reckless would build or buy in areas increasingly threatened by hurricanes, rising oceans, and the natural ephemerality of sand bars. In Florida, the state has now taken over this function of providing "fair" insurance to coastal housing and is sure to lose.

I'm not one to say that insurance should always, or even usually, set rates according to risk. (Health insurance, except for smoking and a couple of other controllable behaviors, should not.) But when the risk is (in the long term) controllable, it sends a message to people that they need to change their behavior. In particular, they need to gradually give up the idea that they live somewhere that is very nice but requires subsidies from inland folks who lack the beautiful view.

November 11, 2012 | Unregistered CommenterJon Baron

@Jon:
Consider:
1. Assume there is a positive externality associatd with coastal property development, the size of which exceeds cost of building optimal flood-containment plus compensating owners for residual losses.

2. If coastal property owners are made to internalize cost of protecting property optimally & then paying residual, they will not have adequate incentive to develop.

3. Now imagine susbidization of insurance for coastal developers is funded by premium increase for property owners in less risky, inland locations (Fla does this). who participate in the surplus crated by the positive externality of coastal development, In this case, the coastal developers, it's true, will have insufficient incentive to take optimal flood-resistance measures. But the parties bearing the cost of subsidizing will face a strong economic & political incentive to push for expenditures of funds necessary to implement optimal flood-protection measures.

If this is true, that insurance subsidization is justified by combinantion of allocative efficiency & political economy considerations.

No?

November 22, 2012 | Registered CommenterDan Kahan

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