Sandy Reconstruction Could Have Long-Term Benefits
Posted at noon on Nov. 26, 2012
Bloomberg reports that in the wake of Hurricane Sandy, “Reconstruction and related purchases and hiring may range from $140 billion to $240 billion and increase U.S. economic growth by 0.5 percentage point next year, assuming $50 billion in losses.”
“Sandy may reduce economic growth by 0.25 percent to 0.5 percent in the fourth quarter after it disrupted industrial production, retail sales and employment… The stimulus is likely to last longer. Insurance claims payments and government funds typically boost the economy for 18 to 36 months after a natural disaster like Sandy.”
But Mark Zandi explains why growth isn’t a sure thing, noting that “airlines don’t get those flights back and restaurants don’t get those meals back… reconstruction gets GDP back above where it would have been otherwise depends on the insurance money and government aid and how people use it.”
