Jack Dunn - Reclaiming Common Sense

Hurricane Harvey is, and will continue to be, a human disaster and an economic disaster. There will be people scratching their heads for days, weeks, months, and years as to the economic impact of the third once in a lifetime "tropical event" to hit Texas (Allison, Ike, and now Harvey.) Those three storms are only during the past 16 years, with Allison making landfall during 2001 as a Tropical Storm. There are many ways to examine the possible impacts of this once in a lifetime hurricane.


Unimaginable Impacts. There has been very little loss of life as of the morning of August 28th. Any loss of live is terrible. Part of the problem with this Hurricane was that it was originally supposed to make landfall around the Yucatan Peninsula of Mexico. It shifted. It hit warm water. It intensified, and it was wedged between two High Pressure systems that did not allow it to move. This combination of events was identified by computer models. One of he problems is that the people analyzing the data had never seem potential rainfall totals in the 36 inch to 60 inch range. In short, the rain damage alone from Harvey was "unimaginable." We can run all the models we want. People have free will to ignore the warning signs. The storm's rapid intensification to a Category Four Hurricane meant that the damage was going to be catastrophic. Death and destruction were almost inevitable.


Imagine the Unimaginable. There are three legs to classic city and regional planning: Economics, Environment, Social Equity, the three "Es." There was a fourth "E" being discussed through the time I was in graduated school: Emergency/Emergence Planning. As future planners we were taught hat we need to balance economic development with environmental protection and social equity. We could not create economic development in ecological sensitive or dangerous areas. We could not justify the displacement of the poor to make way for the well-off. It is hard to deny the development of port cities. What we can do is insure that they are


Economic Triage.There was "Planning Triage" being discussed and misunderstood. The "scholars" were discussing economic Triage as funding high priority, medium priority, and low priority issues. That is not economic triage or planning triage, that is economic/planning prioritization. Triage, in medical terms, is the identification of those who will survive without immediate treatment, those who will die even with intensive treatment, and those who may live or die depending on the timing of the treatment. You expend resources first on those who may live, then on those who will live, and if possible, on those who are dying. It sounds cold. It is resource management. The hardest discussion that will be had is "are there some areas/businesses/neighborhoods that should not be rebuilt?


Will everyone return? One of the many stories of Hurricane Katrina was the "diaspora." This is the fleeing from the region. Some may never return to New Orleans. Some may never return to Houston or the surrounding areas.


Will "everyone be whole again?" There are some things that are not covered in the standard home owners policy. Flood plain maps are rewritten after major flooding. take it from someone who has had a major insurance event: The house will be restored, if you are allowed to rebuild in the "flood zone," your contents may not be recovered. There are depreciation costs. Some things you feel are recoverable may not be able to be recovered. Some items may be able to be recovered and restored. You will be displaced and placed into temporary housing before you are placed in long-term housing. What will happen if apartments that could absorb one to forty families are erased? What if whole neighborhoods and apartment complexes are taken out of the housing inventory? We know that "FEMA Trailers" did not work so well after Hurricane Katrina. We know that there are "Katrina Cottages" that may be available. We know that there is a burgeoning industry for "container homes."  There is going to have to be a  considerable amount of flexibility in working with zoning regulations and home owners associations to get people back on their feet again.


Jobs will be created and Jobs will be Lost. This week the monthly jobs report for August will be released . This report will not reflect any of the job losses of Hurricane Harvey because the data collection data for the Current Population Survey data and the Current Employment Statistics data was collected from the pay period that included  the 12th day of the month. The impacts of Hurricane Harvey on the Houston and Surrounding Areas jobs and unemployment will not be reported until the first week of October at the earliest. Some companies may close. Some companies may furlough people. Some companies may lay-off their worker indefinitely forcing them to reconsider where they work and where they live. Some sectors may take devastating hits to their employment rolls while others (Construction, Trade Transportation and Utilities, Financial Services, Manufacturing) may see a sudden surge in employment opportunities.


Unemployment May Spike - Not for two or more weeks. We are in the period of the year where unemployment claims tend to hit their annual lows for both first-time claims and continuing claims. You have to be unemployed for more than one week and you need to be actively looking for works to qualify for first-time claims. You need to have made a first time claim to reach continuing claims status. Continuing claims data lags first-time data by one week. The spike in temporary unemployment may be partially offset by the seasonal drop in unemployment.


The JOLTS data will not be impacted for months. The Jobs Opening And Labor Turnover Survey (JOLTS) data always lags the Jobs report data by more than a month. This week the August Jobs Report, or Employment Situation Report, will be released. The July JOLTS will be released on September 12th. We will not receive the September JOLTS data until November. We could see job opening vaporize because they are being filled or because they no longer exist. WE could see separations spike. WE will not see an impact here for months.


The Gross Domestic Product will not be impacted for at least two to five months. The second quarter data, April, May and June, are still going through revisions. The Third Quarter data covers July, August, and September, the Advance Estimate, will not be released until October 27th. Half of the GDP data is in for the third quarter. The third quarter is often the strongest quarter. We have seen strengthening new and existing home sales. We have seen strong total retail sales. We will see increased activity as companies ramp up for the Christmas Sales Season.


Retail Sales May Surge Even More than They Already Have Surged This Year. People will want to or need to replace everything. Clothing, Automobiles, Furniture, Electronics, Appliances, home and garden utensils, and every other category of retail sales will be impacted.


This is a terrible event. There is no other way to describe it. We are a resilient country. We emerged from Katrina, Rita, and Wilma.  We had record levels of new home construction and new home sales in the aftermath of the worst Hurricane Season on record. Houston recovered and thrived after Hurricane/Tropical Storm Allison. We may see a surge in existing home sales as people who once occupied apartments find that they do not have a place to rent. People with existing homes may chose to relocate, freeing up local inventory for those renters seeking housing.  Roads will have to be rebuilt. Levees will have to be reinforced. Flood plain maps will be redrawn. Insurance adjusters will be busy for months and possibly years. Residential and Commercial buildings will have to be rebuilt. The economic impacts may not be measurable in the near term. People will be confused. The people of the United States will come together.  We cannot replace lost lives.


Everything else is, by and large, replaceable. We can learn from this "third in a lifetime" experience. We can figure out how to prepare for the next "once in a lifetime" event. We can help those who need the most help right now. There are some properties and businesses that may not be able to be rebuilt. Insurance policies will have to reevaluated. We will have to balance economic development and environmental protection, Social Equity, and Emergence Planning. We can emerge from this stronger and better. We need resiliency planning.


It's the economy