Hurricane Irene as Economic Stimulus? - NBC4 Washington

Hurricane Irene as Economic Stimulus?



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    There may be a silver lining to storm that battered the Atlantic coastline and knocked out power all the way up to Vermont.

    University of Maryland Economist Peter Morici says that after the damage is tallied up, repair efforts could give the country an economic boon.

    After infrastructure is destroyed in natural disasters, Morici told MSNBC, "we generally rebuild better than before."  Morici said that spending on new roads, bridges, and other infrastructure could total as much as $20 billion.  "We'll not only rebuild, but we'll get a multiplier effect, and we'll get more capital," the Maryland professor said.

    The downsides?  In the neighborhood of $25 billion in lost business activity, and perhaps $20 billion in direct property damage.

    But that rebuilding process could put construction workers back on the job that had been sitting idle.  "We'll really use resources that are sitting on the bench," Morici told MSNBC.

    The storm comes on the heels of a consumer spending report that indicates Americans may be loosening up their purse strings again.  The Commerce Department said spending nudged up by .5 percent in July, adjusted for inflation.  Demand for cars helped fuel the biggest gain in monthly consumer spending since 2009.