Sandy recovery claims mount. How much will a divided Congress pay? (+video)
“Historically, Congress has been quite generous when there are disasters,” says Pete Davis of Davis Capital Investment Ideas in Washington, which advises Wall Street clients. “It won’t be in the lame duck session, it will be next year.”
The money will likely come in the form of an emergency supplemental spending bill that will go through Congress once it resolves its current differences over spending and taxes. “If it weren’t for the fiscal cliff this would get done really quickly,” says Mr. Davis.
But, won’t spending another $80 billion to $100 billion throw those calculations out of line?
“It will expand the deficit,” agrees Mr. Collender. But, that is not likely to matter, he and others say.
One of the reasons Congress is so generous is that every senator and representative is keenly aware that a disaster can take place in their district at any time. In the West, wildfires can destroy communities. In the Midwest a drought can hurt farmers. Along the Gulf Coast, there could be another big oil spill.