Superstorm Sandy did more than rock the eastern coast of the United States last year. It also damaged Mitt Romney’s chances in the presidential election. Quotes from Republican primaries, where Romney called for responsibility for disaster response to shift from the federal government to state and local authorities, suddenly looked foolish as those local authorities were quickly overwhelmed. Yet, even as the aftermath of Sandy demonstrates the need for federal help, the Federal Emergency Management Agency (FEMA) in New York is losing US$1.3 billion — roughly 5% of its budget — in government cutbacks.

The cut to FEMA is a false economy. If we do not prepare for the growing threats that FEMA deals with, we will pay more when disaster strikes. Worse, there is a political effort under way to delegate its responsibilities to regional and local authorities.

Discussions on FEMA largely fail to acknowledge the agency’s crucial functions. Climate change, combined with more human development in vulnerable areas, will lead to more Sandy-like events. The question that many countries face is not whether they need a national agency to manage crises, but how to run such an agency in an era of catastrophic risk.

FEMA provides a classic public good. It offers services that the market will not and in which state and local governments under-invest. It makes more sense, and is cheaper, to develop high-level risk expertise at the national rather than local level. This was, in fact, the rationale for the creation of FEMA in 1979. Governors were tired of dealing with a confusing federal approach to disaster response, and convinced then-president Jimmy Carter of the need for a single central agency.

A coordinated response is essential because large-scale crises cut across governmental boundaries and can quickly exceed the capacity of local responders. FEMA fills the unique role of lead coordinator. Much of the public may think of it as a national response agency, but this is not really the case. It is too small to do that, and by law becomes involved only when local and state responders become overwhelmed.

Crisis-response networks of different public, non-profit and private organizations coordinate more effectively if responders speak the same language and follow the same general principles. Only a national government can enforce common standards, and so avert the confusion when multiple approaches conflict in their attempts to manage hazards. After the terrorist attacks of 11 September 2001, FEMA and the Department of Homeland Security forced states and local governments to adopt common preparation and response principles. This approach is not perfect, but it establishes role expectations before a crisis and is flexible enough to deal with different hazards and response networks. Other countries, including Australia, the United Kingdom and China, have followed the US lead.

The public has come to expect that a large-scale crisis will be met with a competent national response.

FEMA also helps states to recover, through measures that include providing money for disaster relief. This is the part of FEMA’s function that provides direct and tangible benefits to individuals and is subject to close attention by elected officials. Studies from both the United States and India suggest that incumbent politicians tend to lose support after natural disasters, but that cash for relief efforts can minimize the political damage. This provides a strong incentive for governors and congressional delegations to seek emergency declarations that trigger federal disaster relief, and for the president to provide them. The result has been a marked rise in the number of presidential emergency declarations made since the 1990s, including declarations for events not traditionally seen as disasters.

Disaster relief has become politicized, and this drains attention from FEMA’s other main function — to mitigate and prepare for disasters. Such investments are made in the absence of a particular threat, and so seem abstract and of limited value to voters. But estimates suggest that every dollar invested in mitigation creates long-term savings of between $4 and $15. We need FEMA to drive the revision of building codes to make buildings more resilient to extreme weather, and to encourage states to build climate change into their hazard plans.

Although Congress was happy to find $60 billion for disaster relief in the wake of Sandy, it is unwilling to invest a similar amount to reduce the impact of the next superstorm. Historically, such investments are made only when FEMA takes the lead to set national standards and share costs. To transfer power from FEMA to local officials would neuter this ability.

To prepare for disaster means building strong working relationships between the organizations that form the crisis-response network. Training and simulation exercises build trust, which is essential in an emergency. Yet cutting them is seen as an easy way to save money. Before Hurricane Katrina hit New Orleans, Louisiana, in 2005, a planned exercise to test hurricane responses was postponed, and a follow-up workshop was cancelled. Without such investments, we can expect more responses that look like those to Katrina — responders disagreeing about who is in charge, and failing to work together.

The public has come to expect that a large-scale crisis will be met with a competent national response. Politicians can help if they enable FEMA to better manage long-term risk. They must, because, however much they want to, they cannot wish away the next Sandy.

figure a

Bob Rashid/La Follette School