First estimates of physical damages caused by hurricane/tropical storm Irene ranged from 7 to 20 billion dollars as of Sunday.
And if one calculates in the loss of economic activity for at
least two days, if not more, through the coming week, losses could
reach as high as 45 billion dollars, said Peter Morici, an economist
and professor at the University of Maryland.
The 7-billion-dollar estimate comes from the Consumer Federation
of America, which said in a statement that payments for wind damage
from Hurricane irene could exceed 5 billion dollars. Flood claims
will likely be less, about 2 billion dollars, since so few people
along the East Coast have purchased flood insurance.
That doesn't mean that flood losses won't be greater than 2
billion dollars. Irene dumped heavy rain starting early Saturday in
North Carolina, and was still pumping moisture onto Vermont, New
Hampshire and Massachussets.
In North Carolina, Hatteras Island had been totally inundated by
wind-whipped sea water, which carved a new channel across a
connecting road and set homes on fire.
Dam breasts have broken and rivers have left their banks,
including New York City's Hudson and East Rivers.
Morici estimated physical damages at 20 billion dollars, but said
an added 25 billion dollars will likely result from economic losses.
Major cities along the East Coast - which represents about 25 per
cent of the economy, Morici says - shut down all activity starting as
early as Friday: Washington, Balitmore, Philadelphia, New York.
The Washington transit system said it had 67 per cent fewer riders
on Saturday than on a normal Saturday. Philadelphia closed its
transit system on Saturday, as did Boston on Sunday. Airports were
only slowly gearing up operations on Sunday.
New York's transit system remained closed Sunday even though the
storm had passed, as crews were inspecting subway tracks for safety,
the MTA said Sunday. New Yorkers were wondering how they will get to
work on Monday.
But Morici was optimistic that the long-term costs spread over two
years will be lessened by the likelihood that people and businesses
that need to rebuild will use the opportunity to build larger.
In addition, the post-Irene rebuilding will be a boon to an area
of the economy now plagued by high unemployment - the construction
industry - Morici said.
