Hurricanes, floods and droughts are putting an increasingly large strain on the federal budget. A new report out Monday from the Center for American Progress finds that Congress spent at least $136 billion on disaster relief between 2011 and 2013.
That works out to $400 per household per year. And those costs could rise in the years ahead — particularly if climate change leads to more frequent extreme weather.
But the most striking part of the report? No one in the government even knew the full amount that Congress had been spending on disaster relief — not the Federal Emergency Management Agency, nor the Office of Management and Budget. The authors had to pore over all the appropriations bills and disaster-relief supplementals that Congress had passed between fiscal year 2011 and fiscal year 2013 to make an estimate.
“If we don’t even know how much natural disasters are costing us, then Congress is going to keep under-budgeting for disaster relief and recovery,” says Daniel J. Weiss of the Center for American Progress, who co-authored the study with Jackie Weidman. “And lawmakers will end up doing deficit spending to pay for it” — typically through emergency "supplemental" bills that are passed apart from the regular budget process.
The two researchers found that a wide variety of federal agencies have received money to deal with extreme weather events over the past two years. There are the big-ticket items: FEMA spent $55 billion on general relief and flood insurance. The Department of Agriculture spent $27 billion on crop insurance, which includes payments after an unsually severe drought in the Midwest in 2012. The Army Corps of Engineers has spent some $7 billion on flood control between 2011 and 2013.
But disaster-relief spending pops up in unexpected places, too. The Department of Justice recently received $10 million to repair a federal prison damaged by superstorm Sandy.
“If anything, this was a conservative estimate,” says Weiss. He says that they couldn’t track down precise numbers for emergency food stamps or the IRS’s disaster assistance fund — so they left those out of the final tally.
Big, costly natural diasters appear to have become more frequent in the United States over the past few decades. According to the National Oceanic and Atmospheric Administration, the number of severe weather events that inflict at least $1 billion in damage (adjusted for inflation) has risen from an average of two per year in the 1980s to more than ten per year since 2010:
There are several reasons for the rise in billion-dollar events, experts say. The U.S. population is growing, so more people live in coastal regions, on floodplains, in fire-prone forest areas, and in other high-risk places. The country is also getting wealthier, so there are pricier homes and costlier infrastructure that get damaged in floods, storms, and fires.
But climate change has also altered at least some weather patterns. A January draft assessment by the U.S. Global Change Research program found that heat waves, heavy downpours, and even severe droughts have become more frequent in certain parts of the country over the past 50 years.
Regardless of the cause, extreme weather events now cost the United States more than $80 billion per year, on average. And the federal government has been picking up a greater share of that tab in recent years, with states and private insurers picking up much of the rest. (Often, however, the damage is simply paid for through lost economic activity — a 2010 study by the National Federation of Independent Businesses found that 30 percent of small businesses fail to reopen following a presidentially-declared disaster or emergency.)
Those costs could rise in the years ahead. The National Climate Assessment warned that a great deal of U.S. infrastructure is vulnerable to “phenomena associated with climate change, including sea level rise, storm surge, heavy downpours, and extreme heat.”
To prepare for that possibility, the CAP authors make a variety of recommendations. For instance: The federal government should start keeping a precise tally of the costs of natural disasters. Congress should invest in “resilience” programs that allow communities to better withstand the damage from extreme weather — paid for by a small fee on fossil fuels. And the CAP report argues that the Obama administration should do more to reduce carbon-dioxide emissions and address climate change.
Otherwise, the report warns, “we are flying blind into a future with more costly disaster-relief and recovery spending.”
--Another angle here: A recent study from the Federal Reserve Bank of New York found that the federal government has been picking up a greater share of the tab for major hurricane events.
--Last year's severe drought in the Midwest has put the federal crop insurance program under scrutiny.
--How Sandy shows the U.S. is unprepared for climate disasters.