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Dull Disasters?How planning ahead will make a difference$

Daniel J. Clarke and Stefan Dercon

Print publication date: 2016

Print ISBN-13: 9780198785576

Published to Oxford Scholarship Online: June 2016

DOI: 10.1093/acprof:oso/9780198785576.001.0001

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Dealing with Disasters

Dealing with Disasters

It should and can get better

Chapter:
(p.1) 1 Dealing with Disasters
Source:
Dull Disasters?
Author(s):

Daniel J. Clarke

Stefan Dercon

Publisher:
Oxford University Press
DOI:10.1093/acprof:oso/9780198785576.003.0001

Abstract and Keywords

The world does not turn a blind eye to disasters. In fact, many disasters are followed by an outpouring of generosity. Despite such gestures, disaster responses often seem insufficient, slow, and not well coordinated, and recovery can take years. The main thesis of this book is that the impact of disasters can be dulled if three things are in place beforehand: (1) a coordinated plan for post-disaster action agreed in advance; (2) a fast, evidence-based decision-making process; and (3) financing on standby to ensure that the plan can be implemented. The solutions presented throughout this book are based on pre-agreed, pre-financed, rules-based plans that can be implemented after a disaster without the need for further political decisions or the hand-wringing that often follows a crisis.

Keywords:   natural disaster, extreme event, pandemic, disaster risk management, disaster risk finance, politics of disaster relief, humanitarian system

In recent years, typhoons have struck the Philippines and Vanuatu; earthquakes have rocked Haiti, Nepal, Afghanistan, and Pakistan; floods have swept through Pakistan and Mozambique; and droughts have hit Kenya and Somalia. All led to loss of life and livelihoods and destroyed infrastructure, buildings, and businesses.1 Recovery will take years.

Typhoon Haiyan (Yolanda), which hit the Philippines in November 2013, killed over 7,300 people; the economic losses totalled about US$12.5 billion. In Nepal, more than 8,000 people were killed in the April 2015 earthquake, and many more were injured. Thousands of homes and even entire villages were destroyed, and lives will have to be rebuilt. The 2004 earthquake and tsunami in the Indian Ocean region and the 2010 earthquake in Haiti are still the worst disasters in recent times, each killing more than 200,000 people.

In Kenya, drought affected more than a million farmers in 2014, battering their incomes and their ability to feed their families and keep their children in school. It can be worse: in 2011 drought in the Horn of Africa contributed to tens of thousands of deaths in Somalia, perhaps half of them young children.2 And it may get even worse: one of the likely effects of climate change is to increase the frequency of the extreme weather events that cause many of these disasters.3

Then there was the Ebola virus outbreak in 2014, revealing how a pandemic in very poor countries can wreak havoc. More than 11,000 (p.2) people were confirmed to have died in Guinea, Liberia, and Sierra Leone.4

It would be wrong to suggest the world turns a blind eye when disasters strike. To the contrary, the media usually beam within the country and across the world horrifying images of the suffering. National politicians promise decisive action. Politicians from rich countries voice their concern and publicly instruct agencies to provide crisis funds to offer relief. Global entertainment stars and television news anchors take heavily promoted emotional trips to disaster zones. Ordinary people respond to appeals with generous donations. Volunteers and experts supported by specialized non-governmental organizations (NGOs) and international and government agencies work with the utmost commitment to bring affected areas back to their feet. And across the world, people support the fundamental motivation behind humanitarian aid: that saving lives and alleviating suffering are the right thing to do. Despite this, the disaster responses often seem insufficient, slow, and not well coordinated.

But does it have to be like this? Do extreme events have to turn into disasters with huge losses of life and suffering? Should responses be full of public emotion, painful media images, and political blame games among international, national, and local politicians that nevertheless prove to be slow and inadequate?

We don’t think so. But it depends on all those involved declaring their willingness to learn properly from experiences around the world and to apply insights from the latest research across a range of disciplines. In this book, we will show how harnessing the lessons from finance and economics, complemented with evidence from political science, psychology, and the natural sciences, can and does make governments, civil society, private firms, humanitarians, and international organizations much better prepared to deal with natural disasters,5 thereby reducing the risks to people and economies. We want to make the responses to these events less emotional, less political, less headline-grabbing, and more something that could become ‘business as usual’.

(p.3) What Does This Book Do?

This book lays out the key problems that can cause extreme natural events to turn into natural disasters; takes the reader through a range of solutions that have been implemented around the world to address these problems; provides an overview of what works and what does not based on the evidence; and presents a framework that ties all of this together. Some of these pieces have been analysed individually before, but this book aims to offer a fresh perspective, drawing various strands together for the first time, including the crucial issue of how disasters are financed, which is often overlooked.

We want to persuade our readers that extreme events do not need to lead to as much hardship and loss of life as at present. We are not just making it up: our arguments are based on the latest research and evaluations of past disaster responses worldwide and other academic research. Each chapter also offers, at the end, both a useful recap and a snapshot of the relevant academic literature. These snapshots of the literature convey the research foundation of our narrative and are a guide to a more in-depth treatment.

What this book does not do is criticize the thousands of deeply committed individuals working tirelessly to bring relief to disaster-torn areas and to prevent further suffering. Our critique is about the national and international systems behind these people, and how there is still a widespread systemic failure to prepare for disaster before it strikes. Our main thesis, which is developed, motivated, and interrogated throughout the book, is that three things need to be put in place before a disaster to protect lives and livelihoods:

  1. 1. A coordinated plan for post-disaster action agreed in advance

  2. 2. A fast, evidence-based decision-making process

  3. 3. Financing on standby to ensure that the plan can be implemented.

If these three things seem obvious, there are plenty of examples in which some or all of them were not in place, resulting in unnecessary (p.4) suffering and economic losses. More important, they are not systematically embedded in national and global disaster response systems.

A myriad of agencies at the national and international levels are entrusted with providing short-term support to those in need when a disaster strikes in order to save lives and alleviate suffering. They are the agencies and departments of local and national governments, various agencies of the United Nations, and national and international NGOs. Collectively, these agencies and their funders are known as the global humanitarian system.6 There is also a range of institutions that support the more medium- and long-term responses and reconstruction after disasters, including national governments, donor governments, and development financial institutions such as the World Bank and regional development banks.

We believe this system has serious flaws. The post-disaster decision-making process is far too politicized, leading to delays, poor decisions, and bad coordination of effort. Recent disasters such as the earthquake in Nepal or Ebola in West Africa are good case studies of the commitments nationally and internationally to provide support, but also of what can go wrong in decision making and the consequences. The good news is that insights from economists and political and behavioural scientists are at hand to improve this situation. And science is helping to achieve much better predictions of when disasters will occur and the damage they will cause. But those affected need more than early warning; they need early action that is evidence-based and fast.

Fast decisions are only sensible if they are related to credible, coordinated plans. Every time a natural disaster hits any part of the world, the newspaper headlines ten days later can be written in advance: ‘Why isn’t the response more coordinated? Still no food or water for some areas’. The truth is, everybody argues for coordination but nobody likes to be coordinated.

Evaluations of recent disaster responses contain vivid examples of these coordination failures. For example, a cross-agency report on the earthquake response in 2010 in Haiti found that there was very poor (p.5) coordination among humanitarian aid organizations after the earthquake; their responses lacked planning and thus were poorly adapted to local circumstances. Many parallel structures were set up inside and outside government, duplicating effort and feeding coordination failures and power battles.7 Evaluations of the response to Typhoon Haiyan in the Philippines in 2013 highlighted similar failures.8 A large response followed, but international donors were unaware of national structures and capacity. Differences in understanding between the international humanitarian community and the local government of emergency relief and recovery phases led to poor coordination and parallel structures.9

Poor coordination and an ineffective response are not only the standard findings in developing countries. In 2005 Hurricane Katrina slammed into New Orleans in the US state of Louisiana. The storm and the subsequent floods killed more than 1,200 people and caused possibly US$100 billion in losses. Official evaluations found that the losses caused by the hurricane stemmed in part from questionable leadership decisions and capabilities, organizational failures, overwhelmed rescue and communication systems, and poor multi-agency coordination leading to a duplication of effort.10 What seems common sense is rarely in place: a careful, pre-financed plan that has been approved by all who might be called on to offer support.

Our strongest criticism of the current disaster responses relates to the way they are financed (post-disaster with no careful pre-disaster planning). Fortunately, insights from economics and finance can help solve this problem. At the moment, much of the response to disasters as well as the entire humanitarian system are funded by voluntary contributions, collected via appeals to donor governments and the public after a disaster takes place. National and local governments also scramble for resources by reallocating from other budgets. It is as if financial instruments such as insurance do not exist.

Meanwhile, appeals are not far off from begging bowls, and governments and donors seem at times to resemble benefactors for a good cause and saviours coming to the rescue rather than participants in (p.6) an organized system in which responses and routes to recovery are carefully planned beforehand using sound financial instruments. Begging bowls and benefactors—this is a system built on medieval financial principles. Although science may not always be able to predict exactly when and where a natural disaster will strike, it can assess the likelihood of different disasters occurring, and disaster-management professionals can assess what response would be useful after each potential disaster. Taken together, these two capabilities mean that financial planning for sensible disaster response and recovery is possible. Despite this, the current systems appear to ignore centuries of progress in developing better financial instruments that can be put to good use to the benefit of those unlucky enough to be affected by disasters.

The Evidence?

One can easily predict the conclusions drawn from evaluations and reviews of any disaster response programme a few years later. This government or agency ‘wasn’t well enough prepared, and also it should have invested more in disaster risk reduction and resilience of communities’. ‘The international aid that was supposed to come in arrived too late.’11 Such evaluations will also point out that the ‘local roads were not rebuilt for years because of a disagreement between the local and national government over who would pay for reconstruction’. The way humanitarian and development support is financed is crucial here: the financing of the system has to ensure that there are strong incentives for credible planning and disaster risk reduction—not just to sit around and wait for a bailout.

Development—that is, a stronger and more inclusive economy and society—is the best form of resilience to a natural disaster.12 This will take time, and even then natural hazards will not go away, especially with climate change lurking. Both the way the national and global humanitarian system is organized and the way it is financed ignore the fact that the incentives for disaster risk reduction and for making (p.7) countries and communities far more resilient to natural disasters are rather poor, and at best an afterthought. And even if the lessons highlighted are starkest for the developing world, in rich societies these lessons remain valid. In the United States, failures in decision making and preparedness planning, poor risk reduction, and the faults in the ways in which response and recovery finance were organized also contributed to greater loss of life and more misery from Hurricane Katrina and the subsequent floods than there should have been.13

There are also plenty of examples—some of them recent and novel—in which seemingly minor developments in the way disasters are planned for and financed have had significant positive impacts on people’s lives. In all examples, the bulk of the planning happens before the disaster and involves pre-disaster commitments over who will do what and who will pay for what. In Kenya, for example, donors, NGOs, the World Bank, and the government are working together in the Hunger Safety Net Programme. Under this programme, pastoralists receive what is effectively an insurance policy—a social safety net that, without delay and questions, pays a cash transfer to a pre-defined group when the rains fail and the harvest is bad so they can afford to buy inputs and food for their families. For even more peace of mind, they also are given the option of buying affordable insurance to keep their animals alive. The scheme has simple triggers; donors and government co-finance it; and costly needs assessments and delays are avoided. It allows pastoralists to invest in their cows, goats, and camels without worry that the next drought will ruin them.14

In Mexico, the country’s National Disaster Fund, FONDEN (El Fondo Nacional para el Desarrollo Nacional), operates a rules-based system to reconstruct public infrastructure such as roads, hospitals, and schools after a disaster hits. In this collaboration among the federal government, state governments, and the private sector, everyone has agreed to an objective procedure to determine the degree of damage, and the processes are implemented by an independent third party and audited by all parties. The result is clarity pre-disaster over who will pay for what. FONDEN also offers incentives for risk (p.8) reduction, rewarding such investments. Financial markets are used to lock in this rules-based approach.15

In India, the government and farmers share the cost of crop insurance that allows cheaper input credit because the banks can now trust that farmers will be able to repay even if their harvests fail. Meanwhile, farmers are protected and able to invest more in their farms.

In Ethiopia, a major drought in part of the country in 2011 did not result in major loss of life (unlike in Somalia). One important reason was that the government, with donor support, had set up the Productive Safety Net Programme, which was designed to be scaled up to absorb more funding and reach more people during a crisis. In 2011 it managed to expand to support 9.6 million people. This was quite a different result from the 1984–5 drought when more than 400,000—and possibly as many as 1 million—people perished when the country was in the midst of a civil war.16

So why aren’t there more of these schemes?

These examples from Kenya, Mexico, India, and Ethiopia have strong similarities. In all these countries, governments and plenty of local and international players are willing to provide support if natural hazards cause hardship. Acting on that willingness, all the parties involved have worked to be prepared in a credible way so that after a disaster the government and its partners can make a political announcement that the system is working rather than having to announce a new ad-hoc initiative. The decision-making process for the response is rules-based and transparent. The nature of the response is defined clearly beforehand. And the financing is organized in a credible way.

In fact, these countries have unintentionally organized themselves as if they are part of an insurance system, using similar principles. It is clear which risks are protected and which are not, and who is responsible for covering what, as if governments and their partners entered into a contract with the individuals and communities involved. These countries gained credibility by ensuring that the financing is in place, including using forms of insurance and reinsurance (India, Kenya, and (p.9) Mexico). They agreed up front to cost-sharing rules between government and donors (Kenya and Ethiopia), state governments (India and Mexico), and the individuals protected (India and Kenya). And they were all conscious of the incentives for moral hazard that plague insurance markets (whereby insurance may induce those covered to stop reducing risk because they are now covered). Like a good insurance system, then, they have tried to design systems that offer incentives for disaster risk reduction.

What is described here is a far cry from the shocking images, media appeals, fund raising, and moral arm-twisting that normally follow a disaster because underlying these programmes are insurance and other financial products. And they are more about accountants, financial management, planning meetings, data, decision-making rules, and well-prepared logistics. This is our purpose: we want to make disasters business as usual, not hand-wringing as usual.

A Focus on Natural Disasters

This book is not about every form of human hardship: across the world, hundreds of millions people are suffering from hunger and despair, and are even at risk of survival from circumstances beyond their control. We focus here on extreme natural events and their consequences. We consider what are called ‘fast-onset’ disasters, linked to sudden events such as earthquakes, floods, and storms, which require an immediate response to protect lives as well as a longer-term recovery from the destruction of homes, infrastructure, and livelihoods. We also discuss slow-onset disasters, which may start slowly, but their effects, such as drought and pandemic, become worse over time, threatening lives and livelihoods. No matter the type of disaster, however, a timely response is key: the later the response, the worse the consequences.

Although this book deals with disasters triggered by extreme natural events, we are very aware that there are other demands for a large-scale response based on the humanitarian system and the generosity (p.10) of people and government that are not covered here. Despite involving billions of dollars each year, spending via international agencies and donors on humanitarian crises related to natural events, including pandemics, is smaller than spending on crises linked to conflict. What has been happening in Syria is a clear example. Massive humanitarian support is needed for the populations affected by conflict, including internally displaced populations and refugee populations outside the country’s borders. These conflict-induced crises tend to last many years, leading to protracted suffering. The financial costs of these responses are collectively many billions per year, often with little prospect of resolution and recovery.

Our approach can offer ideas on how to respond to conflict-induced crises better, not least in the early stages, but there are important differences between these crises and those stemming from natural disasters that will make a successful and a more cost-effective response far harder. We do not want to claim that our approach is applicable in any kind of simplistic way. Nevertheless, some of the lessons on response plans, decision making, and financial planning should offer food for thought for conflict-induced crises as well. It is true in any case that if the global humanitarian system were to use the principles advocated in this book to organize its support for the disasters following extreme natural events, it could focus its intellectual and financial resources much better on handling these other crises.

Let’s Dull Disasters!

Economic losses from disasters such as earthquakes, tsunamis, cyclones, and flooding are now reaching an average of US$250–$300 billion a year.17 In the last twenty years, more than 530,000 people died as a direct result of approximately 15,000 extreme weather events alone; millions of people were seriously injured. Most of the deaths and serious injuries were in developing countries.18

(p.11) Meanwhile, highly infectious diseases will continue to emerge or re-emerge. Natural hazards will not disappear—earthquakes, storms, and droughts will continue to pose threats. There will be loss of life and destruction of infrastructure and houses. Lives and livelihoods will be affected for thousands of people. But, as this book will show, these extreme events do not need to turn into large-scale humanitarian disasters. Better and faster responses are possible. Faster recovery with much less hardship or permanent losses of assets and livelihoods is achievable. Learning from the weaknesses of the current responses and their financing is the first step. Our thesis is that even though there is much generosity in the world to support the responses to and recovery from natural disasters, the funding model, based on mobilizing financial resources after disasters take place, is flawed and makes responses ineffective and late. Being generous after a disaster is too late. The way forward is to act before disasters strike, preparing credible plans with rules-based decision-making and early action and held together with sound financial planning agreed beforehand.

This is not just a technical matter. It will involve political courage and commitment by leaders across the world. If successful, it will make a disaster response less of a media spectacle fraught with emotion and adrenaline. Indeed, it may make disasters a little duller for the twenty-four-hour news outlets. But, most important, it will result in disasters that have a less intense impact, as in the other meaning of ‘dull’. Dulling disasters is what this book is all about.

Recapping…

  1. 1. The world does not turn a blind eye to disasters. Many disasters are followed by an outpouring of generosity.

  2. 2. Despite this, disaster responses often seem insufficient, slow, and not well coordinated, and recovery can take years.

  3. 3. The main thesis of this book is that the impact of disasters can be dulled if three things are in place beforehand:

    • (p.12) A coordinated plan for post-disaster action agreed in advance

    • A fast, evidence-based decision-making process

    • Financing on standby to ensure that the plan can be implemented.

  4. 4. The solutions we present throughout this book are based on pre-agreed, pre-financed, rules-based plans that can be implemented after a disaster without the need for further political decisions.

Notes:

(1.) Data on the exact impacts of disasters are always questionable, but various broadly reliable estimates exist. The data quoted here are from the EM-DAT (Emergency Events Database), <http://www.emdat.be>; Government of Haiti (2010); Government of Nepal (2015); Government of Pakistan (2011); and Swiss Re (2014). Germanwatch (2015) and UNISDR (2015) offer global estimates and discuss patterns of damage and loss of life.

(2.) In Somalia, it was not just the drought that mattered. The drought that peaked in 2011 killed tens of thousands in a large-scale famine that received a poor response. Some have suggested that up to 260,000 may have died, half of these young children (Checchi and Robinson 2013). But its impact was even more devastating because of the conflict raging in the country. Indeed, the droughts with the most devastating impacts in recent decades also took place during conflicts: for example, the drought and famine in Ethiopia in 1984–5 killed between 400,000 and a million people and caused long-term damage to people and their livelihoods (Dercon and Porter 2014). Other examples are Darfur in the 1980s, Ethiopia in 1972, and China (Henan) in 1942 or during the Great Leap Forward in 1958–61. The latter remains the largest famine in the last century; more than 15 million people died from starvation. It was a sign of progress in the latter half of the twentieth century that harvest failures only resulted in famines (defined as large-scale excess mortality) during conflict or serious political repression. See, for example, de Waal (2005) on Darfur in the 1980s, Wolde Mariam (1986) on Ethiopia in 1972–3, and Mitter (2013) on Henan, China, in 1942–3.

(3.) Hallegatte et al. (2015).

(4.) As of 2 December 2015, the World Health Organization reported 11,130 deaths in these three countries. See <http://apps.who.int/ebola/ebola-situation-reports>.

(5.) In this book, we use the shorthand ‘natural disasters’ to refer to disasters caused by extreme natural hazards. We recognize that extreme natural (p.114) hazards do not need to cause disasters and that human behaviour can increase or lessen the impact of these natural hazards (World Bank 2010).

(6.) More formal definitions are possible. ALNAP (2015: 18) refers to the ‘network of interconnected institutional and operational entities through which humanitarian assistance is provided when local and national resources are insufficient to meet the needs of the affected population’, and includes as actors UN humanitarian agencies, the International Red Cross and Red Crescent Movement, recipient government agencies, humanitarian arms of regional intergovernmental organizations, donor governments, and local, national, and international NGOs.

(7.) Details can be found in ALNAP, UKAid, and UNEG (2011).

(8.) See IASC (2014).

(9.) IASC (2014) discusses this in more detail.

(10.) More details can be found in Congressional Research Service (2006) and Department of Homeland Security (2006).

(11.) Many reports and analyses are devoted to discussing ‘what went wrong’ during the responses to disasters. A poorly planned and coordinated response is a common theme. Well-documented cases are the response to the 2010 Haiti earthquake—see, for example, ALNAP, UKAid, and UNEG (2011)—or the response to Typhoon Haiyan in the Philippines—see IASC (2014).

(12.) Strömberg (2007); World Bank (2014a).

(13.) See Congressional Research Service (2006) and Department of Homeland Security (2006).

(14.) Slater and Bhuvanendra (2014); Jensen et al. (2014).

(15.) Global Facility for Disaster Reduction and Recovery (2013).

(16.) Hoddinott et al. (2012); Slater and Bhuvanendra (2014).

(17.) UNISDR (2015).

(18.) According to Germanwatch (2015), in terms of extreme weather events poor developing countries are the most affected. Between 1994 and 2013, Honduras, Myanmar, and Haiti were the countries that suffered the most from extreme weather events. In 2013 the Philippines, Cambodia, and India led the list of such countries. Of the ten most affected countries from 1994 to 2013, nine were in the low-income or lower-middle-income country group, while only one was classified as an upper-middle-income country.