Yet Another Trillion-Dollar Unfunded Liability, California Wildfires Edition
November 11, 2018 in News by Ken
Source: www.dollarcollapse.com
Yesterday an entire California town burned down. Paridise, CA has (had) 27,000 residents and over 1,000 buildings, and now it’s pretty .
That fire and several others are still expanding across the state, threatening tens of thousands of homes. The sets of the TV show WestWorld are gone. Malibu has been evacuated. And dry, windy conditions persist, so the story is nowhere near over.
If this sounds familiar, it’s because massive, sometimes uncontrollable California wildfires are now an annual occurrence, due in part to gradual warming and persistent drought which combine to suck the moisture out of vegetation and turn the landscape into a tinderbox. Here’s a chart showing the recent take-off in the number of fires reported in the state (2013 was most recent year I could find, but the trend is clear – and since then the number of fires has apparently soared).
The reason this rates coverage in a financial blog is population. We’ve been moving millions of people into a place that has always had and always will have wildfires. California’s population is now about four times what it was in 1950, and the influx continues.
Fire is a crucial part of that and many other ecosystems, clearing out dead plants to make room for living. But add 40 million humans along with their buildings and vehicles, and a healthy, resilient semi-desert becomes a hellscape.
A very expensive hellscape. What does it cost to rebuild a town of 27,000 people from scratch? A back-of-the-envelope calculation (1,000 buildings at $100,000 a pop, 15,000 cars at $25,000 per, $10,000 per person for roads, sewers, landscaping, etc) yields several hundred million dollars. For one little town.
Is California budgeting for this? Are the insurance companies? Is Washington? All probably say they are, but only the insurance companies actually are – and even they are probably under-reserved for the past few years’ natural disasters.
This is a massive public planning failure, and yet another unfunded liability – that is, a future cost incurred but not saved for – to go alongside public pensions, government debt and multiplying environmental time bombs.
