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Hurricane Sandy to Leave Big Bill and More Debt in Its Wake

Updated: November 17, 2020|Bill Fay|Economy

Sandy the Superstorm is still winding its way through the Northeast – it’s the biggest and baddest tempest the heavens have unleashed in a generation.

But scientists warn that it may be the new normal – that ever larger-scale hurricanes, typhoons, cyclones, and tsunamis will continue to spawn, spin and spew as the Earth’s oceans and atmosphere react symbiotically to the planetary changes wrought by global warming.

Yet the topic of climate change is never discussed, much less addressed, by the two leading presidential candidates, even though it is arguably the single most important issue of the age. Of course the broader electorate is not much help – most of us don’t want to hear about it, anyway.

Climate change is such a vast and unwieldy concept with so many unknown and potentially devastating consequences, that we’d rather not the subject come up in polite society.

And yet, at some point, it’s going to become necessary to get the deniers and the refusniks and the rest of us with our heads in the sand to finally notice that heightened storm intensity is going to be the order of the day.

Key to Climate Control Our Pocketbooks?

So how can we wake ourselves out of our somnolence? Maybe if we continue to get hit in our pocketbooks, we’ll shake off the torpor. I mean, it’s still about the economy, stupid, isn’t it?

Estimates of Sandy’s damage range from $20 to $100 billion dollars. Not chump change, either way. And the damage comes just as the economy struggles to ramp back into the positive. Now comes this storm, which could rack up more bills and more indebtedness.

Hurricane Katrina’s damage was estimated at over $200 billion. Last year’s Hurricane Irene cost about $14 billion in damage and another $6 billion in lost work and unshipped goods.

Wall Street is literally under water – although not the kind of “under water” that millions of homeowners found themselves in after machinations on the Street helped crater the housing market, making their abodes worth less than what they owed on them.

But perhaps once the country, and more notably, the financial community begins to understand that climate change is real, that it is not going away, and most importantly that it will cost lots and lots of money, it may push us and them into pressuring the politicians who ostensibly work for us to start thinking, and talking, seriously about solutions.

The simple truth is disasters require huge expenditures. And the money comes from everywhere:

It comes from the pockets of consumers struggling to stay afloat (figuratively).
It comes from the strained budgets of states and municipalities that can hardly afford more expense.
It comes from the a federal government already trillions in debt
And it comes from the insurance companies who will have to raise premiums in order to pay claims.

How Hot Do We Need It to Be?

And in this down economy, money is not exactly flowing like water (pardon the pun).

Remember the old frog in the pot paradigm? If you put a frog in a pot of boiling water, it will jump out. But put a frog in a lukewarm pot of water and gradually turn up the heat a degree or two at a time, it’ll get used to the change gradually and stick around.

At some point, you’ve got frog soup.

The question is: How many storms will it take before we notice the waters roiling and boiling around us?

Bill Fay

Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it in 2012, helping birth Debt.org into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering the high finance world of college and professional sports for major publications, including the Associated Press, New York Times and Sports Illustrated. His interest in sports has waned some, but he is as passionate as ever about not reaching for his wallet. Bill can be reached at [email protected].