Two West Virginia University economics professors are drawing national attention for their recent research suggesting a link between natural disasters and political corruption.

“Natural disasters create resource windfalls in the states they strike by triggering federally provided natural disaster relief,” write Peter T. Leeson and Russell S. Sobel in their paper titled “Weathering Corruption.”

“Like windfalls created by the ‘natural resource curse’ and foreign aid, disaster relief windfalls may also increase corruption,” they say.

Television news programs on CBS, CNBC and CSPAN have interviewed the two.

When the Federal Emergency Management Agency sends relief funds of $1 per capita into a state, it boosts corruption in that state by nearly 2.5 percent, according to the research, which was published by the Mercatus Center at George Mason University in Washington.

Eliminating all FEMA relief funds, the authors found, would cut corruption by more than 20 percent in a typical state, they say.

“Bad weather by itself is unlikely to impact corruption,” Leeson and Sobel admit at the outset of their study. “However, the windfall of federally provided resources that follow bad weather is not so innocent.”

Private vendors, given the responsibility to administer and distribute post-disaster supplies, often make decisions based on illegal “side payments” to themselves or their friends, they write.

In 2002, 16 officials were indicted in Buchanan County, Va., after flooding hit the area and federal aid flowed in.

The biggest boondoggles unfolded after Hurricanes Katrina and Rita.

A new study by the federal General Accountability Office estimates that $1 billion was stolen — nearly 19 percent of the $5.4 billion in funds FEMA sent to Gulf Coast states.

Public officials may also make money by sending government funds to private contractors or private individuals in exchange for bribes or kickbacks.

“For example,” Leeson and Sobel write, “a FEMA inspector may agree to overstate the damage the private individual incurred in return for a bribe.”

Sometimes, the corruption is blatant.

Earlier this year, Louisiana police caught one FEMA contractor trying to sell a stolen federal housing trailer for hurricane victims on the black market. That contractor apparently planned to pocket the proceeds.

Leeson and Sobel found that Louisiana was the nation’s most corrupt state, while New Hampshire was the most honest.

Their statistical analysis showed other government funds flowing into a state did not have the same effect.

“Both non-FEMA-related state discretionary spending and federal spending are insignificant. Only FEMA relief impacts public corruption.”

To contact staff writer Paul J. Nyden, use e-mail or call 348-5164.

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