I think it's pretty safe to assume at this point that there's been something of a failure to plan for the eventual landfall of a category 1 hurricane in New York for decades upon decades now. There's been data out there that suggests that such a landfall is somewhat rare on the human scale, about a 100 year event really, but is still frequent enough to need to be on the planning horizon for permanent settlements.
Hell, the dang Europeans build their dams to hold 10,000 year events at bay. Why do our city planners not take into account events that have a relatively low recurrence interval? Some of it has to do with budget priorities and shortfalls, I'm sure. Still, it's hard to discount good old fashioned ignorance and shortsightedness.
This article up on Popular Science does a pretty good job explaining a few odds and ends. The article itself is decidedly more optimistic about the proposed engineering projects than I would be, given how long it took just to get Ground Zero rebuilt into a memorial.
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