Drought costs are just getting started
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Scott Jagow: This wildfire in Lake Tahoe is just awful. It’s destroyed 275 homes and buildings so far. Might be the weekend before the fire’s contained.
Insurance adjusters are already starting to total up the damage. And it’s gonna be a big bill. But perhaps only a fraction of what’s to come — it’s so dry across the country, drought conditions might spark a lot more of these big fires. Sam Eaton reports from our Sustainability Desk.
Sam Eaton: The Lake Tahoe wildfire is the latest chapter in a record dry spell that covers much of the Western and Southeastern U.S. The drought is already costing hundreds of millions of dollars in damage. In California, 13 counties have been declared disaster areas due to crop losses. The timber industry has also suffered.
But Carole Walker with the Rocky Mountain Insurance Information Association says property damage from wildfires may rival hurricane losses:
Carole Walker: We know that from a hurricane perspective, we’re facing trillions of dollars of exposure. When it comes to wildfire, we’re really in that same boat.
Climate change has ushered in a new era of the mega-catastrophe. And before the summer’s over, drought may top the list as the most financially damaging.
Brian Fuchs is with the National Drought Mitigation Center:
Brian Fuchs: Really, there’s not that much in the current outlooks for the next several months to show that this is going to subside in any way.
On the contrary, Fuchs says the severe drought in the Southeast is spreading northward into the Midwest corn belt. And with the ethanol boom causing a record number of farmers this year to skip the more drought-tolerant soybean crop in order to capitalize on high corn prices, a Midwest drought would be devastating.
Fuchs: They’re setting themselves up to be a little bit more vulnerable. And that’s gonna potentially hurt them economically, because they don’t have that second crop to fall back on.
And he says if that happens, consumers could feel the pinch, paying more for everything from food to insurance.
In Los Angeles, I’m Sam Eaton for Marketplace.
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