As the Atlantic hurricane season enters its peak months starting with August there’s a good chance a major, named storm will hit an East Coast city, a location along the Gulf coast or an American territory in the Caribbean.
Getting food, water and other supplies to storm-ravaged areas can demand Herculean coordination and logistical planning. It’s easy for things to go wrong, resulting in shortages, delays and waste that can imperil victims of disasters. Think New Orleans or Puerto Rico.
Blockchain could offer full transparency and accounting, with no human intervention or paperwork needed.
But blockchain technology could help streamline the process and get help where it is needed the most.
Craig Fuller, managing director of the Blockchain in Transport Alliance, tells ThirtyK blockchain could speed supply procurement, better coordinate transportation and improve recordkeeping.
After Crisis, Chaos
“The confusion, lack of organization and lack of coordination between government agencies and contractors can create a very chaotic environment,” says Fuller, who earlier in his career ran relief logistics for US Xpress, a large transportation company that often contracts with the Federal Emergency Management Agency. FEMA is responsible for coordinating federal natural disaster assistance for state and local governments in carrying out their responsibilities to aid citizens.
There is much that can go wrong when disaster strikes. A sudden spike in demand for items such as ready-to-eat meals, cots, generators and bottled water can force contractors to resort to suppliers thousands of miles away. Transportation companies must contend with impassable roads and dangerous delivery destinations. Multiple layers of contractors can add to the complexity and confusion of relief efforts.
Under pressure to get relief to disaster areas quickly, suppliers often go outside their normal carrier networks. Brokers don’t have time for full compliance checks. Tracking, billing and capacity planning is sometimes done by hand or on Excel spreadsheets. On the ground, some loads lack paperwork, Fuller says. “Drivers are literally writing orders on pieces of paper and turning them in for billing,” he says.
The Cato Institute has criticized the government’s response to Hurricane Katrina in 2005, saying officials failed to prepare, hadn’t accumulated sufficient supplies before the storm and had breakdowns in communication.
Urgency can also lead to FEMA awarding contracts to inexperienced companies. The New York Times, for example, reported how the agency, in the wake of Hurricane Maria last year, awarded a contract for 30 million meals to an Atlanta entrepreneur with no experience in large-scale disaster relief. When 18.5 million of the meals were due, the contractor had only delivered 50,000, and they weren’t even packaged correctly.
There can also be outright fraud. Nick Schwellenbach, director of investigations at the Project on Government Oversight, said in a blog post the “potential for fraud and waste is great” and the federal government needs better oversight.
Blockchain to the Rescue?
Fuller envisions FEMA adopting a blockchain system that would match disaster locations with appropriate vendors for relief supplies. When disaster strikes, smart contracts would automatically trigger orders. Electronic logging devices could trace each load of freight from warehouse to truck to final destination.
Such a system would offer full transparency and accounting. “There would be no human intervention or paperwork needed…and the ledger would provide an accurate, trustworthy record of all transactions and costs associate with the project,” Fuller says.
He says trucking companies are already looking to blockchain to increase transparency, boost efficiency and expedite payments.
Fuller’s not alone in seeing great potential for blockchain in disaster relief. Matthew Hochstein, project management professional and disaster specialist at Hagerty Consulting, tells ThirtyK blockchain could help FEMA to coordinate more assistance faster. The American Council for Technology–Industry Advisory Council released a report late last year that identified disaster recovery as a strong use case for blockchain.
FEMA might be receptive to blockchain solutions. The agency’s administrator, Brock Long, wrote in the 2017 Hurricane Season FEMA After-Action Report released in July 2018 the agency must simplify its processes and use technology to reduce complexity and increase efficiency. The report makes no specific mention of blockchain or any other technology the agency could use to streamline the post-disaster process.
Hochstein says any blockchain solution would require “rigorous testing” before being used by FEMA.