Thursday, June 12, 2008

Flooding threatens economy of the Midwest

"Drenching rain and widespread floods in the Midwest are taking momentum out of a regional economy that has been among the brightest spots in the U.S. economy recently," Ilan Brat and Lauren Etter report in The Wall Street Journal. They say the floods are already being compared to those in the region in 1993, which caused $20 billion in losses. (Wisconsin State Journal photo by Steve Apps shows Viola, a town of 667 on the Kickapoo River.)

"Meat processor Tyson Foods Inc. is temporarily suspending work at two Iowa hog-slaughtering plants, while farm-equipment maker Deere & Co. was forced by rising rivers to evacuate a foundry in that state. A St. Louis-based riverboat casino on the Mississippi River closed, and a lake at a popular resort in Wisconsin emptied after an embankment burst. Towns across the region are confronting collapsed bridges and overflowing sewers. Further heavy rain may burst or overtop already stressed dams and levees in Wisconsin and Iowa." Southwest Indiana is also hard-hit, after 10 inches of rain.

Development of rural areas could be worsening the floods. "Large swaths of farm and forest land that had been soaking up excess water are now covered with concrete and asphalt for neighborhoods, shopping centers and parking lots, increasing water runoff into waterways," the Journal reports. "And local governments hungry for property-tax revenue have continued to allow construction in floodplains, according to a federally sponsored evaluation of the National Flood Insurance Program published in 2006." (Read more; subscription may be required)

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