Tuesday, October 30, 2012

Disaster Relief Helps the Incumbent

Research shows that President Obama may get a bump in the polls from Hurricane Sandy.

How might Hurricane Sandy affect the 2012 presidential election? Many political analysts are speculating about the impact of the storm on early voting and the candidates' abilities to campaign in battleground states. However, recent research by political scientist Neil Malhotra of Stanford Graduate School of Business and economist Andrew Healy of Loyola Marymount University suggests a more subtle effect. Their findings, published in the American Political Science Review in 2009, show that voters reward presidents for delivering relief spending after a disaster strikes.

Examining data from 1988-2004, Healy and Malhotra find that a doubling of relief payments before an election on average boosts the incumbent's vote share by about 0.5 percentage points, potentially enough to swing a very close election. The images of President Barack Obama visiting the Federal Emergency Management Agency (FEMA) and pledging federal disaster aid to affected communities therefore may help him at the ballot box next week.

At the same time, this behavior on the part of American voters may not be optimal for the country. Healy and Malhotra also find that money the government spends on preparing for a disaster provides no boost for the incumbent president. This creates bad incentives whereby presidents are encouraged to deliver relief spending, but not invest in preparing for disasters before they take place.

Perhaps it's not surprising then that since 1988, the amount of money the United States spends on disaster relief has increased 13 times while the amount of spending on disaster preparedness has been flat. The researchers also found evidence to support Benjamin Franklin's adage: "An ounce of prevention is worth a pound of cure." They estimate that $1 in preparedness spending is worth $15 in relief payments in preventing future disasters.

While President Obama may benefit from a visible and swift response to Hurricane Sandy, voters' willingness to reward relief over preparedness efforts costs the United States billions of dollars a year.