Time to Talk About Hurricanes

Flooding in Port Arthur, Texas, from Hurricane Harvey

Flooding in Port Arthur, Texas, from Hurricane Harvey
In the aftermath of a mass school shooting, pundits and politicians tell us that families are in mourning so, “This is not the time to talk about gun control.” Similarly, right after hurricane flooding claims dozens of lives, we hear, “Now is not the time to talk about property owners taking responsibility for their own situation.” With all due respect to those who have lost loved ones in Hurricanes Harvey and Irma, now is PRECISELY the time to talk about why people put themselves in harm’s way, and why taxpayers keep paying for clean-up and restoration of homes and businesses that shouldn’t be there in the first place.

Someone once said the definition of insanity is doing the same thing over and over again, and expecting a different result. Yet that’s exactly how it is with residents and business owners who continue to return to, relocate to, and build in flood-prone areas. In fact, since Hurricane Andrew struck in 1992, a three-county area in South Florida has one of the fastest growing populations in the nation, and now stands at 6 million people. Why? Because the rest of us have their backs every time a disaster strikes.

James Howard, a data scientist at Johns Hopkins University, assessed this phenomena in a recent issue of “The Conversation”. According to Dr. Howard the cycle of insanity began in the late 1960’s when our federal government created the National Flood Insurance Program (NFIP) to help people who live in flood zones, and couldn’t afford to pay for private flood insurance. Sounds like a noble undertaking, but Howard says that the presence of a taxpayer-backed insurance program has only served to encourage more development in “coastal and other flood-prone areas.” An increase in private development then brought about the destruction of the kinds of plants and grasses that prevent erosion which, in turn, “increased the likelihood of flooding.” Over time, Dr. Howard says this has resulted in “higher damages and losses from hurricanes and storms.”

And so, NFIP, which has indirectly made flood damage more costly, is collecting less in premiums than it pays out in claims, and is now over $23 billion in debt. That means, absent any substantive reforms, taxpayers who already back the coverage, will now also have to foot the entire bill for clean-up and restoration going forward. How significant is that? Already, estimates are that Hurricane Harvey will cost us nearly $200 billion in damages and clean-up, or about 1% of our nation’s total GDP. And we haven’t even calculated the damages from Irma.

Dr. Howard summarizes the dilemma we face: “NFIP subsidizes development thereby transferring the costs away from current developers and property owners, and to either future owners or taxpayers. Repeatedly flooded properties also receive an indirect subsidy through the frequent rebuilding costs, which are absorbed by NFIP and not the property owners.”

Ron Paul came to that same conclusion in 2012 right after Hurricane Sandy ripped through New Jersey and New York. Wrote Paul in “The Hill”, Many think that there is a need for the government to provide flood insurance…after all, the market would never provide insurance in flood-prone areas at affordable prices. But shouldn’t that tell us something? Shouldn’t that tell us that it is a losing proposition to insure homes in coastal areas and flood plains…and if it’s a losing proposition, should taxpayers subsidize the inevitable losses arising from federal flood insurance?”

The solution is painfully obvious. Howard believes that property owners who choose to live in areas ripe for flooding, should bear the “real costs” of ownership. Translation? If you want to live in a flood zone and soak up the sun and fun year-round, then you need to take responsibility and soak up the costs to rebuild your homes and businesses after every natural disaster. I can hear the PC critics now, “Hey Jim, a lot of lives have just been lost in two major hurricanes, so this is not the time to talk about requiring owners to pay for the choices they make.” OK, if not now, then when? Next week after Hurricane Jose makes landfall? Or maybe next year after another storm hits the Gulf, kills more people, and disrupts our oil refineries? I’m sorry, but now IS the time to talk about reforms, like moratoriums on residential and commercial construction in flood zones, erection of flood walls to protect the environment and essential economic development, and incentives for people who move away from flood-prone areas.  The point is that it won’t kill us to talk about these issues now, but it might kill us if we don’t.

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