Congress is still searching for a deal to provide funding for several disasters that are tragically starting to stack up in queue of neglect.
It doesn’t have to be this way. Disasters aren’t anomalies — they are unfortunately a sure thing throughout our history, and they are getting costlier every year.
{mosads}The 14 years since Hurricane Katrina has seen 10 of the highest years for federal disaster relief in the last 50 years. Three of the most expensive years have occurred since Hurricane Sandy six years ago.
Politicians will often go to the mat over relatively small increases or decreases in funding during the annual appropriations process. Yet the federal government allocated more on recovery efforts following Hurricane Sandy than it did that year on higher education, agriculture or the Department of Homeland Security. That is why it is time for the U.S. to start financially planning for disasters instead of reacting to them when they occur.
When lives are lost — which is, of course, an incalculable loss — and property is destroyed, the U.S. should respond with all appropriate means. We are the wealthiest and arguably the most generous and compassionate nation in the world.
But the cost of long-term rebuilding should be part of the budget process and not lumped in as emergency, deficit-financed spending.
The U.S. pays for disasters now like many families pay for an unexpected emergency: on credit.
Current budget rules exempt emergency spending from spending caps meant to encourage fiscal discipline. Those rules specify that in order to qualify, emergency provisions must be necessary, sudden, urgent, unforeseen and temporary.
Not surprisingly, however, lawmakers eager to get around budget rules have routinely applied the emergency designation to many non-emergencies, including carrying out the decennial census — a constitutional responsibility that is about as far from “sudden” and “unforeseen” as you can get.
Even when the emergency in question is clearly legitimate, responding to an unforeseen crisis can put major strains on the budget. The national debt on its current course will grow larger than the entire economy as soon as nine years from now. As the share of the budget devoted to entitlement programs and interest on the debt continues to grow, we run the risk of running out of the fiscal space necessary to adequately respond to emergencies and other needs that could be equal to the size of Hurricane Katrina, the 9/11 terror attacks and its response, or even another recession.
A better system for emergencies might be to set aside money each year in a special reserve fund that could be tapped when truly needed. This might also cause lawmakers to be a bit more discerning in what they classify as an emergency.
Dishing out billions in disaster relief without offsetting the costs over a reasonable period of time would continue the unfortunate and unsustainable cycle of deficit-financed emergency spending.
None of the disaster relief funding Congress passed for Hurricanes Katrina or Sandy was paid for — an amount close to $90 billion. That is roughly what the U.S. spends on veterans’ income security each year.
{mossecondads}In response to the 2017 hurricanes, Congress added more than $120 billion to deficits over the next 10 years. Some of it was immediate relief that needed to get out the door quickly, but most of it passed many months after the hurricanes struck. Congress had the time to identify offsets to pay for disaster spending — an important step toward fiscal responsibility.
It would be better if Congress budgeted for disasters in advance. It doesn’t make sense that we always wait until the last minute, especially when savings can come from enacting new policies to help mitigate some of the root causes of increasingly frequent natural disasters.
The threat of our huge and growing national debt might not be as imminent as an approaching storm, but over time it could end up being more destructive to our nation’s economy.
Maya MacGuineas is the president of the Committee for a Responsible Federal Budget. Follow her on Twitter: @MayaMacGuineas.