Mother Nature's Wrath Creates Prosperity

Disasters spur economic growth, but at what cost?
By Green Point,  Newser User
Posted Jul 8, 2008 7:25 PM CDT
Residents carry their belongings past buildings destroyed by the May 12 earthquake in Beichuan county, in southwest China's Sichuan province Tuesday, June 24, 2008.    (AP Photo/Andy Wong)
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(Newser) – Casualties aside, natural disasters may not be so devastating after all. Catastrophes like the recent earthquake in China destroy old buildings and roads, making way for new and improved infrastructure that may not have been created otherwise and pumping cash into the economy. In the long term, updated technology and efficiencies have the potential to create a more productive economy, reports the Boston Globe.

But critics argue that disasters financially benefit those least in need, with the revitalized economy doing little to help the hardest hit. And as aid flows in, significant amounts of private money stream out, as residents view the area as less stable and move away. "Society is not made wealthier by destroying resources," says a critic. Otherwise, "Beirut should be one of the wealthiest places in the world."