Sandy is a Keynesian

I saw it fly past in yesterday’s Twitter stream: ‘Hurricane Sandy is a Keynesian’. And I thought, “Hmm.”

Now, don’t get me wrong. There’s no way in hell I’m happy about this storm (in fact, I’d like to send an invoice to oil lobbyists and tell them to split the bill), but I do think there might be a silver lining.

Because the construction industry has been moribund for a while. Now it will explode, and a lot of people who didn’t have jobs will have them.

And those people who have those new jobs will spend money, and that will create more jobs. How many? That depends on how much money the feds put into the recovery. (Don’t forget, Wall Street brokers live in these affected areas, too.)

This story appeared after Hurricane Irene, but it still applies:

When it comes to the larger economy, Irene could provide a hefty stimulus. Analysts are already predicting a big jump in construction and home-furnishings spending as beleaguered homeowners rush to repair and replace property that was destroyed in the storm. Economist Peter Morici estimates that this short-term consumer spending boost will total roughly $20 billion, and suggests that it may have some long-term positive effects. To begin with, he predicts a multiplier effect of about $16 billion as post-disaster spending works its way through the economy. What’s more, as business owners replace destroyed property, Morici estimates that there may be a long-term economic improvement of more than $10 billion.

Other analysts agree; David Kotok, chairman of money management firm Cumberland Advisors, notes that his company is now predicting that fourth-quarter GDP growth may go as high as 3%, fueled by “Billions [that] will be spent on rebuilding and recovery.”

Unfortunately, much of this growth will be dependent upon the political climate. Cumberland assumes that, among other things, “Washington may set aside the usual destructive and divisive partisan political wrangling and act in the interest of the nation.” If this is the case, Kotok emphasizes,federal financial assistance will rush to troubled areas, quickly stimulating rebuilding efforts.

However, if the recent debt ceiling debate demonstrated anything, it’s that “neither snow nor rain” nor the best interests of the country can slow down Washington’s partisan wrangling. When it comes to post-Irene rebuilding, the battle lines have already been drawn: House Majority Leader Eric Cantor (R-Va.) is demanding other federal budget cuts to offset disaster assistance spending, and FEMA is in the middle of a funding crisis that — barring quick action — will undoubtedly delay some rebuilding efforts.

Meanwhile, GOP presidential candidate and U.S. Rep. Ron Paul (R-Texas)reiterated his argument for killing FEMA altogether.

I just don’t see it now. I just don’t see the Republicans lying down on the railroad tracks and letting the train of popular opinion run over them. They’ve done it before, of course, but this time it’s just too many voters. The sensible thing would be for them to call an emergency session of Congress and pass a massive funding bill for the reconstruction.

Or will they throw public opinion to the wind and instead double down on the Cantor Doctrine? Stay tuned.

Union thugs

Electricians from all over the country poured into the East Coast this week and are now moving to the areas hit hard by the storm. Atlantic City and NYC cops and firemen waded into waist-deep water to save people in dangerous areas with power lines down. Union nurses and hospital aides carried patients out of NYC hospitals that lost generator power.

The next time I hear some asshole talk about “union thugs,” I may punch them.

NYT: Big storm requires big government

Not Katrina redux! The New York Times editorial board, on the day Hurricane Sandy wreaks havoc in the Big Apple, aims at Mitt Romney’s crotch and gives him a good, hard kick. Good! I’m tired of so-called “news” organizations that treat the crap that spews from right-wing zombies as if it’s worthy of intelligent consideration. Let’s kill the Romney/Ryan/Cantor Randian wet dream once and for all:

Disaster coordination is one of the most vital functions of “big government,” which is why Mitt Romney wants to eliminate it. At a Republican primary debate last year, Mr. Romney was asked whether emergency management was a function that should be returned to the states. He not only agreed, he went further.

“Absolutely,” he said. “Every time you have an occasion to take something from the federal government and send it back to the states, that’s the right direction. And if you can go even further and send it back to the private sector, that’s even better.” Mr. Romney not only believes that states acting independently can handle the response to a vast East Coast storm better than Washington, but that profit-making companies can do an even better job. He said it was “immoral” for the federal government to do all these things if it means increasing the debt.

It’s an absurd notion, but it’s fully in line with decades of Republican resistance to federal emergency planning. FEMA, created by President Jimmy Carter, was elevated to cabinet rank in the Bill Clinton administration, but was then demoted by President George W. Bush, who neglected it, subsumed it into the Department of Homeland Security, and placed it in the control of political hacks. The disaster of Hurricane Katrina was just waiting to happen.

The agency was put back in working order by President Obama, but ideology still blinds Republicans to its value. Many don’t like the idea of free aid for poor people, or they think people should pay for their bad decisions, which this week includes living on the East Coast.

Over the last two years, Congressional Republicans have forced a 43 percent reduction in the primary FEMA grants that pay for disaster preparedness. Representatives Paul Ryan, Eric Cantor and other House Republicans have repeatedly tried to refuse FEMA’s budget requests when disasters are more expensive than predicted, or have demanded that other valuable programs be cut to pay for them. The Ryan budget, which Mr. Romney praised as “an excellent piece of work,” would result in severe cutbacks to the agency, as would the Republican-instigated sequester, which would cut disaster relief by 8.2 percent on top of earlier reductions.

Does Mr. Romney really believe that financially strapped states would do a better job than a properly functioning federal agency? Who would make decisions about where to send federal aid? Or perhaps there would be no federal aid, and every state would bear the burden of billions of dollars in damages.After Mr. Romney’s 2011 remarks recirculated on Monday, his nervous campaign announced that he does not want to abolish FEMA, though he still believes states should be in charge of emergency management. Those in Hurricane Sandy’s path are fortunate that, for now, that ideology has not replaced sound policy.

“Give it to the states”? The “reconstruction” of New Orleans was a feeding frenzy for politically-connected Republican sharks. Ridiculous profits, often for work that was never done. Illegal destruction of properties that were than handed over to the developers. And the work that was done, was done selectively — as in, how well connected are you?

No. No, no, a thousand times no.

Storm updates

I’m here, I’m alive, no water to be seen, electricity’s still on. Yay! How about you?

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9:00 p.m. EDT Monday: The United States Geological Survey (USGS) issued a landslide alert for Md., Del., Va., and southern Pa. “The most likely type of landslide triggered by this event will be shallow landslides on coastal bluffs in the Chesapeake Bay area and adjoining estuaries. In addition, some areas in the forecast area contain landslides that were caused by Hurricane Irene and Tropical Storm Lee in 2011 that have not yet been stabilized.”

Only 15,000 without power in Philly. Pretty good!

@nydailynews: Flooding in lobby at @NYDailyNews in Lower Manhattan has now reached 3ft. #Sandy

If conditions are not safe on Wednesday for Trick or Treating, I will sign an Executive Order rescheduling #Halloween.
— Governor Christie (@GovChristie) October 30, 2012

Read more:

Sandy declared post-tropical at 7 pm. Post-tropical means a non tropical entity…regardless, wind gusts will exceed hurricane force along the North Jersey coast and will exceed 60 mph inland over the next few hours. The center of Sandy is currently working onshore shortly between Cape May and AC…it will push west-northwest through South Jersey and into Northern Delaware over the next few hours. Strongest winds locally in city for the next several hours despite little if any rain.

@mtainsider: Wind gust of 100 mph prompted us to close the RFK Bridge at approx 7:30 p.m. The bridge is now closed.

UPDATE: The storm is going south of the city and looks like it’s going to hit northern Maryland.

Deep thought: Sandy is a Keynesian! Expect plenty of construction jobs in the aftermath…
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