Storm puts big government back on agenda

There is no agreement yet on who should pay for the recovery. Photo / Mel Evans

Hurricane Sandy, whose wall of salt water swamped the New York subway and devastated the New Jersey coastline leaving estimated damages of US$20 billion ($24 billion), has put the role of "big government" back at the heart of the political debate, only days before the American presidential election.

Everyone recognises that it's time to overhaul the crumbling and antiquated infrastructure along the wealthy eastern seaboard which is critical for the United States economy, and solutions abound, but there is no agreement on who should pay.

"It's an opportunity. Crisis brings opportunity. Look how New York and New Jersey were defenceless against a storm," says Phil Bloomer, the spokesman of outgoing Republican moderate Congressman Tim Johnson who sits on the House transportation and infrastructure committee.

Bloomer pointed to the Thames barrier protecting London, and said "something along those lines needs to be done here to prevent flooding and protect the electricity grid."

But asked whether Sandy might lead to the opening of a conversation with the radical Tea Party members of the Republican party, who are resolutely opposed to the Government, Bloomer paused before replying, "that's problematic."

"There are a lot of difficult elements," he went on, speaking by telephone from the Congressman's Illinois district. "The dynamics aren't easy. We're up to our ears in debt and it's a question of shifting resources."

Mitt Romney, the Republican presidential candidate, has recommended transferring emergency funding from the Federal Emergency Management Agency, Fema, to the states. On Wednesday, he did a u-turn after the federal Government was widely praised for its effective response to the megastorm. Among those praising Fema - and President Obama - was the Republican Governor of New Jersey, Chris Christie.

Romney issued a statement in which he essentially endorsed the existing disaster relief system, saying that as president he would "ensure Fema has the funding it needs to fulfil its mission".

The argument was still raging in the US media on Thursday after the Wall Street Journal took issue with an editorial in the New York Times which had argued that "big storms require big government". The Journal said that the handling of the megastorm rather meant that "this isn't an argument for abolishing Fema so much as it is for the traditional federalist view that the feds shouldn't supplant state action".

The conservative daily pointed to the division of responsibilities between the states and the federal Government in terms of restoring services and repairing damage. Interstate infrastructure such as roads and rail comes under the purview of the federal Government and the states.

The President wants to divert the money available from winding down overseas wars into public investment for the rebuilding of roads, railroads and runways in order to enable business to grow. But he has been pilloried by the Romney campaign which accused him of belittling individual achievement when he said "if you've got a business - you didn't build that". In fact, he was talking about the contribution of the public investment in roads and bridges which contributed to business success.

The Republican nominee, who suspended his campaign for two days in the wake of the megastorm, was on the campaign trail on Thursday hammering Obama on his plans to expand "big government" rather than the private sector, particularly a presidential proposal for a new agency headed by a "secretary of business" to help create jobs.

But an infrastructure expert at the Brookings Institution, Robert Puentes, said that the effects of the hurricane "will amplify the issue of federalism across the board, and what the Government should be doing". In addition to the row over Fema, he pointed to the broader issue of climate change, which has been highlighted by a series of natural disasters to hit the East Coast, of which Sandy was by far the most severe.

The mayor of New York, Michael Bloomberg, mentioned climate change on Thursday as the reason for which he had decided to vote for Mr Obama.

The Congressional gridlock, which is even more prevalent than the traffic gridlock along the eastern seaboard, means that decades-old plans for a high-speed railway line linking Washington and New York have never materialised. Obama, who envisions a high-speed network serving 80 per cent of the US population by 2025, has proposed spending US$53 billion on modernising the infrastructure, but his proposals were rejected by the House Republicans. The opening of a US$6 billion rail link between the Washington Metro and Dulles Airport, the gateway to the nation's capital, has also been delayed.

The difficulties of reaching agreement in Congress, which controls America's purse-strings, have been evident since last year's failure to agree on a budget package to avoid a so-called "fiscal cliff". Unless agreement is reached by the end of the year, cuts of $1.2 trillion will kick in across the board until 2021.