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Hurricane Ian will cost ‘billions and billions of dollars in losses,’ former FEMA administrator says

Former FEMA Administrator from 2009-2017 Craig Fugate joins Yahoo Finance Live to discuss the aftermath of Hurricane Ian, the extent of the damage, how the storm compares to other hurricanes, and rebuilding efforts as climate change intensifies extreme weather events.

Video transcript

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- We are getting a clearer picture of the destruction Hurricane Ian left behind this morning. The storm made landfall in Florida as a Category 4 hurricane, bringing sustained winds of up to 150 miles an hour, making it the most powerful storm to hit the US in recent memory. It has since been downgraded to a tropical storm. We are continuing to learn more on Hurricane Ian's potential death toll as well. Lee County Sheriffs earlier saying it could be in the hundreds.

Now as it stands, approximately 2 and 1/2 million people have been left without power. The storm is expected to cause more than $67 billion in damages and losses. But, of course, this is a very early assessment given that the hurricane made landfall yesterday. Let's bring in Craig Fugate. He is the former FEMA administrator under President Obama. Craig, I know you were in Florida, not necessarily in the path of the hurricane. But I imagine you've been making some calls in terms of where things stand. What are you hearing from your sources in terms of assessing the damage?

CRAIG FUGATE: Well, what you're hearing, this term "catastrophic," which everybody uses, but this is truly what you're seeing with a storm surge caused tremendous damage and those extremely high winds. We're seeing flooding in a lot of places in the state. It looks like Ian is still causing a lot of problems up in the Northeast Florida. St. Augustine is flooding. So this could be very widespread. But where you see the greatest loss, risk of loss of life injuries is really in those areas where-- that were in the evacuation zones that had all the damages.

- You have been in Florida for some time. You know these hurricanes. Give us an assessment here about how this compares to some other storms. You said the word catastrophic. We've heard that over and over and over. But give us the context of how significant this was in relation to what we have seen historically in this state.

CRAIG FUGATE: This is Southwest Florida's Andrew. This was not as much-- with Andrew, you saw mainly wind damage. The big impacts down here in Southwest Florida is the storm surge and how powerful it is and then with the high winds on top of that. So this is, for Southwest Florida, the worst hurricane they've ever had, just to put it in context.

And this compares to, you could basically take what we saw in 2004 when we were hit by four hurricanes, I'm not even sure-- the numbers are going to be very premature, but I wouldn't be surprised to see this become one of the highest losses in hurricanes in recent US history.

- We're talking about more than 2 million people still without power. , Certainly the assessment of the damage just beginning. What's your most immediate concern as somebody who has led these efforts in the past?

CRAIG FUGATE: Well, it's doing exactly what the local officials are doing, Governor DeSantis and FEMA, is get the rescue teams out to those barrier islands, get out to those areas. They've got National Guard helicopters. They've got Fish and Wildlife boats, the search and rescue teams have boats. It is really about getting the people that are still out there, people that are injured, people that were trapped, and giving those people to higher ground. And that's really the priority right now.

Utilities will start turning on power where they can. But you're also, you know, it's described, I think, by Florida governor-- by Governor DeSantis, in some of those counties, it won't be hooking power back up. They're going to have to rebuild the power grid from all the damages.

- And how is that, how long is that likely to take if you're talking about a full rebuild?

CRAIG FUGATE: Well, I can give you an example. When we dealt with Hurricane Wilma and had that type of damage, it was three or more weeks for most residents to get power back up. So this is, for the concentrated damages, they're going have to rebuild the grid.

Other parts of the state, those big numbers will start coming down today because I've even had power outages up here in Gainesville. These are trees down on power lines. Those are things you can relatively fix quickly.

If you're looking at the images coming out of there, the poles are down. The wires are all down. It's destroyed. And it's actually faster, in many cases, to rebuild it than try to repair it when there's that much damage.

- Craig, it feels like every year we're now hearing about these once-in-decades, once-in-a-century type storm events that are happening. Clearly, there are the effects of climate change accelerating this. You look at how significant this storm was specifically, what does this tell you about how the planning needs to shift around these types of storms? Obviously, Florida certainly not immune to this. We know officials on the ground have been assessing this for some time, but the event that we saw most recently, what does that tell you about how much worse things are likely to get on an annual level?

CRAIG FUGATE: Well, in this show, I think we'll get it. We're pricing risk below the point which we change behavior. And we're continuing to grow and build in areas that are vulnerable to these extreme events. And it's not that we can't have development. But we really need to think more about how we're building, not looking at the past. Terms like 100-year events and 1,000-year events really aren't capturing what's happening. And this will be billions and billions of losses, both from the insurance company, but also from federal taxpayers having to pay for this response.

And these people, some of them have lost everything. Some didn't have insurance. They won't have insurance for flood. So we need to really go back and think about how we basically drive the investment in building infrastructure in communities that can withstand these storms in a way that we don't suffer these tremendous losses year after year.

- Yeah, certainly expectations shifting by the year. Craig Fugate, it's good to have you on today, former FEMA administrator under President Obama.