There was an interesting article in the NY Times today talking about a decline in property taxes for those cities and counties hit by Hurricane Sandy. This decline may be delayed but governments are concerned that they will be receiving significantly lower revenue and may have trouble paying for public services like police and schools. This worry is also increased by the fact that financing for rebuilding will also be made more difficult.
This event has got me thinking again about climate change and its macroeconomic effects. If natural disasters continue to occur will governments have to prepare budgets to accommodate for these changes? Just food for thought. Especially in a time where state and local governments are struggling to pay bills. What's everything thinking about these issues?
http://www.nytimes.com/2013/01/25/nyregion/storm-damaged-homes-mean-lower-property-tax-revenues-in-new-york-region.html?_r=0
When I think about the macroeconomic impact of climate change, I think back to <a href="http://www.nytimes.com/2012/11/19/science/earth/as-coasts-rebuild-and-us-pays-again-critics-stop-to-ask-why.html?smid=fb-share>this NYT</a> article about how disaster aid gets us into destructive loops of rebuilding in places that are bound to be destroyed again. Much of the damage of global warming is going to happen no matter how much we reduce carbon emissions, and mitigating that damage will be very important. For example, we need to stop rebuilding on locations that will get destroyed every five years. In addition, immigration will be extremely important. Weather changes in some locations may hurt agricultural productivity and living standards in some places (tiny islands in the Pacific, places that are already hot) but boost them in others (Russia). It'll be important that people be allowed to freely move in order to minimize the damage from global warming.
ReplyDeleteInteresting stuff that losses in some places also means gains in others, a good thing to remember.
ReplyDeleteGovernments should definitely accommodate budgets/ planning for these natural disasters. It is a tough topic to think about what is best to be done to those places that get consistently hit. It's scary too to think about how places can even recover from such disaster. With cuts in schools and other services, it must take so long to "rebuilt" these areas from the disasters and the economic repercussions. I understand a lot of the article but I'm having trouble understanding why the tax revenue is going to be such a big hit. Anyone want to help me understand why this is so bad?
ReplyDeleteGrr...I messed up my first hyperlink. Here's the NYT article
ReplyDeleteIt's definitely important for governments to accommodate the budgets for these natural disasters because many of the people involved in these disasters have lost everything. Many of them probably did not expect for these disasters to occur and now are stuck trying to rebuild while also just putting food on the table for their families.
ReplyDeleteYou have to accommodate areas that are prone for natural disasters. People know the risk of living in these areas and to get people into those houses means lower taxes. The government, just like some American families, are also struggling to pay bills. Any price cuts they can take will help them out. The government should look elsewhere and cut spending so they can allow for lower taxes in areas that are prone to be hit by natural disasters.
ReplyDelete