New Orleans was founded in 1718 and by the early 19th century had grown into the largest city in the southern United States. Its land area protected by natural levees was very small, so as the city expanded, it spread into marshland that was drained using pumps, drainage canals, and artificial levees. More reliable electric pumps and the development of better levees at the start of the 20th century allowed for accelerated development. In the years since, however, weather-related catastrophes have become common in and around the city of New Orleans.
In 1915, a hurricane overflowed the protection system along the city’s Lake Pontchartrain shore. Water levels reached 4 meters in some districts, and it took four days to pump the water from the city. The government responded by upgrading pump stations and raising levees along the drainage canals. In 1947, another hurricane hit the city, and the levees failed again. Thirty square miles flooded, and 15,000 people had to be evacuated. Again, major improvements to the protection system followed in the immediate aftermath of the disaster, with levees being raised and extended.
In 1965, Hurricane Betsy made landfall, and New Orleans flooded again. About 13,000 homes filled with water, leaving 60,000 people homeless and causing 53 deaths and more than $1 billion in damage. This led to the passing of the Flood Control Act of 1965 by the U.S. Congress and to an ambitious plan to protect New Orleans. The plan was to be fully implemented within 13 years, but in the face of numerous difficulties, including conflicts with environmental protection movements, it remained stalled for about two decades. It was eventually revised into the “high level plan.” The implementation of that plan was 60 to 90 percent complete when Hurricane Katrina struck in 2005, leading to the flooding of 80% of the city and unprecedented human and economic damages. The complete failure of the protection system in 2005 demonstrated that both construction and maintenance had not been adequately supervised and monitored.
Aftermath of Hurricane Katrina in New Orleans
Over the past 100 years and four disasters, the New Orleans region has experienced large socioeconomic and environmental changes. In particular, the population has been changing fast, and local sea level rose by 5 centimetres per decade, about 50 cm in all, because of geological factors. The failure to protect New Orleans in this context of rapid changes, illustrated by a decrease in the city’s population since its peak in 1965, can provide important lessons regarding how to manage risks. Indeed, global sea level rise due to climate change will affect all coastal cities in the future, and this rise is expected to be of the same order of magnitude than what was experienced in New Orleans in the last one hundred years. Over the coming decades, many cities around the world will thus experience the same changes in risk as New Orleans did in the past, and one can hope they do not have to go through a similar series of disasters.
Fortunately, risk management also offers more positive stories. In the Netherlands, subsidence also made local sea level rise by about 2 cm per decade during the 20th century. A flood there in 1953 caused more than 1,800 deaths and extensive damage. But the response to this event went beyond just engineering more and better protection. The Delta committee was created to manage the response from institutional, legal, and technical perspectives. In 1960, the committee published the Delta Plan, which included an engineering section, the Delta Works, but also a new approach to the management of flood risks. The Delta committee determined an acceptable level of flood risk in different regions of the country through a combination of economic analyses and political decisions. From there, it derived an optimum level of protection, which could then be used by engineers to design protection systems.
Risk management in the Netherlands does not exhibit the same cycle as in New Orleans, where defence improvements have been driven by disasters demonstrating the weakness of protections. The Dutch Law on Water Defences requires that water levels and wave heights used in risk analyses and in the design of protections be updated every five years and that water defences be evaluated for these new conditions. Such a response does not reduce risk to zero, and the Netherlands dealt with flooding again in the 1990s. But the five-year updates ensure that changing demographic, economic and environmental conditions are taken into account in the design, maintenance, and upgrades of flood defences, even if no disaster has occurred.
New Orleans’ history shows how socioeconomic and environmental changes can increase both the risk and the damage when storms strike. The Netherlands example suggests that good risk management can reduce the losses. With the right policies and decisions, future risks can be managed, even as climate change increases vulnerability in some places. Strengthening risk management will not eliminate disasters, but it will avoid many crises, save lives, and reduce losses and suffering.
In a book recently published with Springer, I try and provide insights into how to manage natural risks in a changing environment, using an economic perspective to inform risk management and climate change adaptation. We cannot predict how well we will be able to manage future risks in the face of climate change, but much can be done to increase the odds of a scenario in which ever-changing socioeconomic and environmental conditions are accounted for, disaster risks are reduced as much as possible, affected populations are supported in post-disaster situations, and climate change impacts are as limited as possible. The book tries to provide a framing and a few methodologies to do so.
The book reviews three scientific debates on linkage between disaster risk management and adaptation to climate change. The first involves the existence and magnitude of long-term economic impacts of natural disasters on development. The second is the disagreement over whether any economic development is the proper solution to high vulnerability to disaster risk, or if specific policies are needed. The third debate involves the difficulty of drawing connections between natural disasters and climate change and the challenge in managing them through an integrated strategy.
The introduction describes economic views of disaster, including direct and indirect costs, output and welfare losses, and use of econometric tools to measure losses. The next chapter defines disaster risk, delineates between “good” and “bad” risk-taking, and discusses a pathway toward a balanced growth that allows risk-taking without exposing populations and economies to excessive vulnerabilities. A chapter then reviews current trends in weather and climate hazards such as heat waves, floods and droughts, and describes state-of-the-art climate change scenarios and their implications for risk management. The book reviews methodologies to assess risk management actions in a context of uncertainty on future climate, disagreement on preferences, and pre-existing inequalities. In particular, it explores “cost-benefit analysis” and its extensions, and “robust decision-making”. Case studies are proposed on hurricanes and the US coastline; sea-level rises and storm surge in Copenhagen; heavy precipitation in Mumbai; coastal protections in New Orleans; and early-warning systems in developing countries. Among the conclusions is the assertion that risk management policies must recognize the benefits of risk-taking and avoid suppressing it entirely, and the fact that a combination of disaster-risk-reduction, resilience-building and adaptation policies can yield large potential gains and synergies.