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Thursday, November 24, 2022

CBO: Extreme Weather Costs $54 Billion Annually and Will Rise Without Policy Changes

The Congessional Budget Office (CBO) estimates that expected annual economic losses total $54 billion for most types of damage caused by storm surges, hurricane winds, and heavy precipitation. Expected annual federal spending in response to hurricane winds and storm-related flooding totals $17 billion.

In CBO’s estimate, expected economic losses represent long-run average annual costs based on current conditions, including sea levels and property in areas at risk of severe storms. CBO estimated those expected losses on the basis of large-scale commercial models that simulate hundreds of thousands of potential storms that might occur under current conditions, along with their probability of occurring. It also used data on 58 storms that occurred between 2005 and 2016. Spending on repair and replacement accounted for the largest share of federal spending in response to hurricanes winds and storm-related flooding between 2005 and 2016.

Estimates of expected costs are inherently uncertain. Because of data limitations, CBO’s estimates exclude some types of costs, such as losses to assets that the federal government would not fully repair; losses to parts of the private sector, such as the energy, agricultural, and industrial sectors; and nonmonetary losses, such as emotional cost of losing a home.

CBO says roughly two-thirds of households’ expected losses from flooding and one-fifth of households’ expected losses from wind are uncompensated.

Meanwhile, expected outlays to address losses to the public sector total $11 billion, accounting for 65 percent of estimated federal spending. Of the $203 billion of federal spending, $153 billion went to address public sector losses.

Without policy changes, storm-related costs are likely to rise in the future because of climate change and development in risky areas.

Read the full report at CBO

Homeland Security Todayhttp://www.hstoday.us
The Government Technology & Services Coalition's Homeland Security Today (HSToday) is the premier news and information resource for the homeland security community, dedicated to elevating the discussions and insights that can support a safe and secure nation. A non-profit magazine and media platform, HSToday provides readers with the whole story, placing facts and comments in context to inform debate and drive realistic solutions to some of the nation’s most vexing security challenges.

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