Opportunity Cost: Preparing for Sandy and Katrina
After every storm of the century, we ask why we didn’t prepare sufficiently.
For Katrina it was better levee protection. And now, for Sandy, I just heard that the PATH–underground trains between NJ and NYC–had 4 foot flood gates (some news articles say 6 foot) from 1992 that just did not work. As a result, 10 million gallons of water flooded the system and created damage that will require at least $300 million to remedy.
On September 12, I posted the following:
Along its 520 mile long coastline, New York’s waters have eased upward at an inch a decade, a rate that some say is accelerating. If so, by 2050, another 2 feet might be added. Although not below sea level, New York is vulnerable. A direct hurricane hit could mean subways flooded for weeks, basements inundated, electricity out, undrinkable water, commuter transport lines incapacitated.
6 weeks later, on October 28, super storm Sandy hit. And yes, subways flooded for weeks, basements were inundated, electricity was out, water was undrinkable and commuter transport lines were incapacitated. Now, still cleaning up from her massive damage, NY and NJ are asking those September 12 questions. Should they prepare for the next Sandy? Should the PATH at a cost of $181 million have higher floodgates? Below is a picture of an inflatable bladder. At $400,000 or so apiece, these bladders could be mobilized when a storm approached.
Our Bottom Line: The timeless issue is opportunity cost. With cost defined as sacrifice, the cost of disaster preparation is whatever we cancel because we cannot afford to do both. To what extent do we divert money and resources that we need now to preparation for an event that might not occur?
Sources and Resources: This blog from WNYC specifies commuting hardships created by Sandy and here is the article about and source of my picture of inflatable subway bladders. Responding, here is the Congressional debate about mitigation for future storms.