Of the half a million people displaced by Katrina, about half don’t want to go back, even though Mayor Nagin went to Atlanta and tried to persuade many evacuees there to come back. That leaves about 250,000 people displaced, and several states holding the bag for integrating them into new locations. The state with the most evacuees is not Louisiana: it’s Texas. Side effects ripple much farther out than that. While I was in New Zealand recently, a common topic was Katrina: how sorry everyone was that it happened, and how NZ people expected their insurance rates to go up because their insurers had been telling them they would. This makes sense, since insurers for the affected areas will probably have to call on their reinsurers, causing the reinsurers, which are typically worldwide, to raise their rates, affecting insurers globally.

So the side effects of lack of preparation for a known risk include not only more than a thousand people dead and more than a hundred billion U.S. dollars in economic damages, but also a quarter million people displaced and higher insurance rates in countries on the far side of the world. A stitch in time (or better levee foundations) would have saved nine.

-jsq