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As millions of Americans begin dealing with the devastation from Hurricane Harvey, which hit the Houston area on August 25, millions more are bracing for the potential of a second powerful storm. Hurricane Irma, which reached Category 5 strength on Tuesday, could make landfall in Florida by the weekend and cause billions more in property damage on top of the havoc already wreaked by Harvey.
The storms are refocusing attention on the topics of preparedness, land-use regulations and catastrophic insurance. Wharton professors Howard Kunreuther and Robert Meyer, who are co-directors of the school’s Risk Management and Decision Processes Center, visited the Knowledge@Wharton show on SiriusXM channel 111 to talk about how this year’s active hurricane season can become a platform for change. They were joined by Wharton legal studies and business ethics professor Eric Orts, who is director of the Initiative for Global Environmental Leadership. The following are key points from the conversation.
Expect the best, but prepare for the worst.
Harvey’s biggest wrath has come from historic flooding measured in feet, not inches. The resulting property damage is in the billions. Yet it has been reported that only 15% of the property owners in the area hit by the storm have flood insurance. The professors said part of the problem is that most people believe it will never happen to them, so they don’t prepare.
“It’s one of these things where it’s very, very difficult for both individuals and organizations to get their heads around the extremely rare [event],” Meyer said. “You have a tendency to think either something’s going to happen, or it’s a risk we don’t have to worry about.”
Preparation requires action on the part of individuals, businesses and the government. It requires foresight, money and political will, the experts said.
“There is this problem of long-term planning, especially for high-consequence, low-probability events like this one,” Orts said. “I think one of the main takeaways here is that you really have a role for government to play in these kinds of situations, and you have a positive role for regulation. If you look at Houston, it’s really an example of urban development that did not take into account questions of flood control and rational policies. Those kinds of policies are very important.”
Since Harvey, news reports have illuminated the inadequacies in Houston’s land-use regulations and infrastructure to deal with quagmires such as storm drainage. It’s a problem facing many cities in the United States and around the world. Kunreuther agreed that regulations are important, but he said the topic of climate change also needs to be part of the agenda.
“It’s getting the message across that we’ve got to do something now instead of waiting until the disaster occurs,” he said.
Disaster preparedness is a shared responsibility.
Finger-pointing and recrimination is common after any natural disaster. Pundits, politicians, the media and citizens all want someone to blame, and it’s easy to blame each other.
“There are a lot of cooks in the kitchen in terms of where the fault lies,” Meyer said. The average home buyer, for example, has no expertise in flooding and relies on a real estate agent to disclose whether a property is flood-prone. The real estate agent will say flooding has never happened in the area, the homeowner doesn’t get insurance, and eventually there is a problem.
“How do you fix that problem?” Meyer said. “One strategy would be to go through regulation and say we’re going to require this and require that, but that just pushes back against a lot of notion of individual freedom. Houston doesn’t believe in zoning, much less making people buy flood insurance.”
Orts pointed out that Texas is, in a sense, too big to fail. Now, the federal government has to spend billions to bail out the state from Harvey’s floodwaters.
“When you look at the long-term planning, what you want to have is businesses and individuals be rational about if they’re going to build in a flood-prone area or a high-risk coastal area, then they buy the insurance to cover it,” he said. “That means if you have requirements to buy insurance, then the private market is handling the risk and you don’t have it all hitting taxpayers when you have a big disaster. That is a problem that we’ve had for many years now. Especially with another hurricane about to hit, maybe a rational reassessment of the policies that we have could come into effect.”
Kunreuther said a key issue is defining what roles the public and private sectors play in flood insurance, which is currently only provided by the federal government.
“There are now movements … into the private sector, and everyone is in favor of the private sector on one level. Certainly, all of us at Wharton would like to see private-sector involved as a part of our mantra,” he noted. “But at the same time, we recognize that there are a whole set of other issues that may require the public sector.”
Meyer said property owners must bear some of the burden by educating themselves and asking the right questions.
“At the end of the day, it’s ultimately an individual decision about where to live,” he said. “It’s really dangerous for individuals to assume the government’s going to fix it all.”
Kunreuther agreed but said there are a lot of disincentives to providing information.
“We have to find ways to not only let people know what the risk is, but we also may have to find ways to have appropriate regulations where a lot of other people might be hurt by virtue of this,” he said. “I think this is one of the challenges that we face in the renewal of the [flood insurance] program. When do we regulate? When do we let in individual freedom?”
“I think one of the main takeaways here is that you really have a role for government to play in these kinds of situations, and you have a positive role for regulation.” –Eric Orts
The time for change is now.
The National Flood Insurance Program is set to expire on September 30, and its timing with this powerful hurricane season could been seen as fortuitous. It gives policymakers a chance to explore what needs to change and how.
“We’ve got to begin to reflect on these longer-term issues in terms of taking advantage on the positive side of every disaster,” Kunreuther said. “We have a lot of history on disasters that people always come to the rescue right after, then we forget quickly.”
In their book, The Ostrich Paradox: Why We Underprepare for Disasters, Kunreuther and Meyer wrote about how the lack of planning carries heavy consequences. “What tends to decay very rapidly over time is emotional memory,” Meyer said.
Orts added that any catastrophe typically tends to “focus the mind” and generate short-term forward momentum. But there is often little long-term will, so that momentum slows to a stop.
“A lot of people — including academics, policymakers, etc. — are saying, here’s a rational policy to have. But you need to have the political will to push that forward.”
Kunreuther said he hopes Congress will delay action on the flood program for a few months so meaningful work can be done on creating a better program. He noted three issues that have to be incorporated into a cogent disaster-preparedness policy are climate change, loss mitigation and affordability.
“There are low-income people who are in these areas,” he said. “If you just let the private sector take over, you are going to have an enormous problem of people who say, ‘I can’t pay the $20,000 that I’m going to have to pay for my insurance policy.’ We have to put that on the table.”
Image: By SC National Guard – 170831-Z-AH923-081, Public Domain, https://commons.wikimedia.org/w/index.php?curid=62096178
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3 Comments So Far
Edward Dodson
Realistically, it is too late to move large populations out of harms way of climate-related disasters. However, one step that can be taken to lower the risk of major disasters is to encourage local governments (cities, towns, townships, boroughs, counties and school districts) to move to a land-only property tax base. What would this accomplish?
It would remove the tax burden from owners of homes and other buildings to make it easier to strenghten the building, raise it, or even tear it down and replace it with a better design. Better design should lower the cost of insurance protection against potential damage.
Second, it dramatically change the way real estate development occurs by providing a strong financial incentive for owners of vacant and underutilized land to bring the land they hold to its highest, best use (or sell to someone who will). Highest, best use is determined by permitted uses, building codes and height restrictions.
Anumakonda Jagadeesh
“Now let us be clear (and the point of science is to be as clear as possible): There is still uncertainty on how climate change will affect hurricanes. What is clear, however, is that greater warmth means more moisture in the air which means stronger precipitation. And while asking “did this specific event happen because of climate change” is the wrong scientific question, it’s all about trends and the movement toward dangerous “never seen before” kinds of rainfall — one that scientists are seeing.
By altering the chemistry of the atmosphere, we’ve unbalanced forces that are literally astronomical in scale. It’s the flow of energy from the sun that we’ve inadvertently redirected, channeled through the Earth systems of atmosphere and oceans. Even small changes in those systems are enough to unleash events that dwarf our civilization’s ability to control or respond. These are events like “never been seen before” explosive rains that transform a city into an inland sea in just a few days.
But civilization will, by definition, have to respond to the sky-spanning forces we’ve unleashed. That’s where money comes in. We’ve been delaying action on climate change for decades now. A big part of that delay has come because we’ve been told the costs of averting climate change are too high. But even before the waters have retreated, Hurricane Harvey is looking to be the most expensive disaster in U.S. history. Projected costs may run north of $100 billions. The fighting in Congress has already begun over who will pay for it — or if it will be paid at all.
As never-seen-before weather events are seen more regularly (the National Weather Service had to add more colors to its rainfall map for Harvey), it’s now becoming clear that averting climate change will be less expensive than responding to it.
More than anything, though, the images from Hurricane Harvey catapulted us past equating climate change with clever ideological arguments. From the elderly residents in a flooded nursing home to first responders racing in boats across wave-tossed rivers that were interstate highways the day before, we all saw the ultimate reality of climate change as nothing less than concentrated human suffering. It was millions people in the jaws of desperation. And if we turned our eyes to Bangladesh, India and Nepal, we could see millions more at peril.
We’ve gotten so used to thinking about climate change in the abstract that we’ve forgotten why exactly anyone should care about it in the first place.”( Climate, Power, Money And Sorrow: Lessons Of Hurricane Harvey
September 6, 2017 ADAM FRANK,NPR).
Global Warming and Hurricanes
An Overview of Current Research Results
Aug. 30, 2017,Geophysical Fluid Dynamics Laboratory)
Two frequently asked questions on global warming and hurricanes are the following:
• Have humans already caused a detectable increase in Atlantic hurricane activity or global tropical cyclone activity?
• What changes in hurricane activity are expected for the late 21st century, given the pronounced global warming scenarios from current IPCC models?
In this review, we address these questions in the context of published research findings. We will first present the main conclusions and then follow with some background discussion of the research that leads to these conclusions. The main conclusions are:
Likelihood Statements
The terminology here for likelihood statements generally follows the conventions used in the IPCC AR4, i.e., for the assessed likelihood of an outcome or result:
• Very Likely: > 90%,
• Likely: > 66%
• More Likely Than Not (or Better Than Even Odds) > 50%
• It is premature to conclude that human activities–and particularly greenhouse gas emissions that cause global warming–have already had a detectable impact on Atlantic hurricane or global tropical cyclone activity. That said, human activities may have already caused changes that are not yet detectable due to the small magnitude of the changes or observational limitations, or are not yet confidently modeled (e.g., aerosol effects on regional climate).
• Anthropogenic warming by the end of the 21st century will likely cause tropical cyclones globally to be more intense on average (by 2 to 11% according to model projections for an IPCC A1B scenario). This change would imply an even larger percentage increase in the destructive potential per storm, assuming no reduction in storm size.
• There are better than even odds that anthropogenic warming over the next century will lead to an increase in the occurrence of very intense tropical cyclone in some basins–an increase that would be substantially larger in percentage terms than the 2-11% increase in the average storm intensity. This increase in intense storm occurrence is projected despite a likely decrease (or little change) in the global numbers of all tropical cyclones.
• Anthropogenic warming by the end of the 21st century will likely cause tropical cyclones to have substantially higher rainfall rates than present-day ones, with a model-projected increase of about 10-15% for rainfall rates averaged within about 100 km of the storm center.
Dr.A.Jagadeesh Nellore(AP),India
Praveen Tiwari
Yes, we need to be long sighted. Shifting the large population isn’t a permanent solutions, preparedness with some big solution is needed.