President Trump travelled last week to see damage from the North Carolina floods and Los Angeles wildfires. He suggested that the Federal Emergency Management Agency (FEMA) be reformed or terminated, and he signed an executive order creating a new council to review the agency.
Trump suggested “maybe getting rid of FEMA,” and he said, “I think we’re going to recommend that FEMA go away and we pay directly.” The president’s inclinations are right, as I discuss in this study, but we should phase out FEMA and federal payments to the states for disasters.
The American system of disaster response is not supposed to be a top-down structure imposed by Washington. Rather, the system is based on federalism, private charitable efforts, and mutual aid between states, cities, and utilities. Unfortunately, growing federal intervention is undermining this efficient, decentralized structure.
Here are 10 reasons why FEMA is not needed and sometimes detrimental.
- Budget deficits. The federal government must cut spending to deal with massive budget deficits. Congress should repeal funding of activities that the states can fund themselves, including disaster response and reconstruction.
- Federalism. The Congressional Research Service noted, “The United States takes a ‘bottom up’ approach to both managing and providing assistance, during and following a disaster.” State and local governments employ more than one million personnel in police, fire, and other first responder activities. State governors have wide-ranging responsibilities and powers during disasters, such as being able to order evacuations.
- Role Not Unique. A bipartisan congressional report after Hurricane Katrina in 2006 noted that “many Americans … falsely viewed FEMA as some sort of national fire and rescue team,” but “FEMA is not a first responder agency.” Instead, FEMA’s main role is handing out aid, but states should cover disaster costs with their own rainy day funds.
- Bad Incentives. Growing FEMA bailouts create a disincentive for states, businesses, and individuals to prepare for disasters. The states demand federal aid, and federal politicians put the costs on the national credit card. Growing federal intervention displaces more efficient state, local, and private efforts.
- Infrastructure. The vast majority of the nation’s infrastructure is owned by state and local governments and the private sector, not by the federal government. It is the responsibility of infrastructure owners to know the risks, to fortify facilities, and to seek insurance coverage.
- Top-down regulations. With federal funding of disaster response and rebuilding comes top-down regulations that encumber state and private efforts. FEMA’s bureaucratic barriers to private efforts during and after disasters are notorious, as with Hurricane Katrina in 2005.
- Private-Sector Response. In US history, disasters have generated huge outpourings of aid from individuals, businesses, churches, and charitable groups. The American Red Cross, for example, provides food, water, and temporary shelter after disasters. After recent flooding in North Carolina, Elon Musk sent more than 10,000 Starlink terminals, Walmart and Home Depot delivered food and supplies, and Taylor Swift donated $5 million.
- Resource Sharing. A key feature of US disaster response is resource sharing between states, cities, utilities, and other groups. Standing agreements allow governments and utilities to rush teams and equipment to their neighbors hit by hurricanes, fires, and other disasters. Firefighting teams and equipment have poured into Los Angeles from dozens of states and Canada. Within a day or two of Helene hitting North Carolina, utility crews were arriving from up and down the East Coast.
- Interstate Fairness. Each state has pros and cons that individuals and businesses trade off when considering where to locate. Florida and California have warmer climates than Michigan but higher risks of natural disasters. It is not fair for low-risk states to be continually paying through taxes for disasters in high-risk states, especially when the latter have not sufficiently prepared.
- Crucial Federal Roles. While FEMA mainly hands out aid, other federal agencies hold critical skills and resources for disaster response. The Coast Guard’s search and rescue operations are vital during hurricanes. The National Guard under state command plays many crucial roles after disasters, such as medical care, law enforcement, and debris removal. The US Army supplied assets to aid the Helene and Milton efforts, and the Air Force flew search and rescue missions.
Congress should phase out FEMA aid for disaster preparedness, response, and relief. FEMA does perform some unique roles—such as flood mapping—and these can be moved to other agencies. Some FEMA activities, such as flood insurance, should be privatized.
In the wake of Katrina, Florida Governor Jeb Bush warned against strengthening federal powers at the expense of the states: “As the governor of a state that has been hit by seven hurricanes and two tropical storms in the past 13 months, I can say with certainty that federalizing emergency response to catastrophic events would be a disaster as bad as Hurricane Katrina.”
As such, the federal government should only fill roles where it can add value not provided by the states or private sector. In disasters, Bush noted, “If you federalize, all the innovation, creativity, and knowledge at the local level would subside.” That is true in many areas of state, local, and private activity.
This study elaborates on these ideas.