From Hurricanes to The Solar Eclipse – the Economic Impacts of Nature

With the onslaught of hurricanes in the southeastern states and Caribbean, safety is the number one things that comes to people’s minds. After the initial rescue and relief are provided, what about the longer-term need for recovery and rebuilding? Think tanks are providing suggestions, like how to coordinate federal assistance efficiently and how to rebuild in a more resilient way to minimize damage from similar future events.

Estimated total recovery costs for the communities hit by Hurricanes Harvey, Irma and Maria are nearly $300, including direct impacts (like property damage) and secondary impacts (like economic disruption). There is an economic silver lining. Recoveries usually provide a small economic boost as rebuilding efforts create jobs and circulate earnings.

On the positive side – not all natural events are economic disasters. The solar eclipse in August of this year is one such natural event.  I had the opportunity and pleasure to see the total solar eclipse from a little community in Idaho. Small towns located in the eclipse’s path of totality from Oregon to South Carolina prepared for years ahead of time for the tenfold population increases generated by visitors. I witnessed the economic impact of the event as restaurants were packed and even ran out of food and as local entrepreneurs catered to visitors’ needs and desire for memorabilia.

With appropriate planning and coordination, we can maximize the benefits resulting from positive events while minimizing the impacts of disasters.

Written by Dima Galkin, an Associate at RSG