Hurricane Harvey might turn out to be one of the most expensive natural disasters ever to hit the United States, eclipsing even Katrina in damages.
The two main financial measurements are:
• Impact on the US economy
• Insured losses, i.e. how much insurance companies will have to pay
“The geographic scope of this event is probably what is going to make it one of the most costly flood disasters in US history,” says Samuel Brody, director of the Center for Texas Beaches and Shores at Texas A&M University Galveston. “I’ve seen heavy rain…but not over such a large geographic area, impacting rich, poor, black, white, you name it.”
Flooding from the storm has displaced thousands of people in Texas and Louisiana, and the rain is still falling. Many people are still stranded.
“There are a lot of places that are not accessible by car or truck or boat, and we need to get to the survivors to get them critical aid,” says FEMA spokeswoman Deanna Fraser.
The death toll is close to 40.
“Officials fear that the number of fatalities will climb sharply in coming days as neighbors, emergency workers, and family members search for the missing – and discover the bodies of people trapped in waterlogged homes or encased in underwater graves inside cars,” reports Newsmax.
“We have so many citizens that are trapped inside their homes,” says Captain Crystal Holmes of the Jefferson County Sheriff’s Department. “Eventually we will” get to them, “but we just don’t know if we’re going to be able to get to them in time.”
According to Texas Governor Greg Abbott, more than 24,000 National Guard troops have been deployed to help the people of Texas.
The 50 counties affected by Harvey are home to roughly 11 million people. Data shows that most of the people who lost their homes did not have flood insurance, and the out-of-pocket costs for these people could total as much as $28 billion.
Damages to the economy could be as high as $190 billion. To compare, Katrina cost us $160 billion and Sandy cost us $70.2 billion.
Another unforeseen effect of the storm will be a widespread increase in gas prices. Damages from Harvey have effectively shut down 23% of US refining capacity – potentially slashing fuel production ability to 2008 levels.
Fuel prices in New York have already increased by more than 6%.