More floods are coming. Of interest is that the Flood Insurance Program is paid for by governments. No private industry is able to backstop flood insurance, so the government steps in to allow us to continue building near water that rises.
“Yesterday, the Federal Emergency Management Agency (FEMA) published a landmark investigation on the connections between climate change, population growth and sea-level rise. The study concludes that the amount of the U.S. at risk for floods could increase 45% by 2100, doubling the number of flood-prone properties covered by the National Flood Insurance program and exacting a strenuous toll on the country’s Flood Insurance Program.”
Reason Magazine has a pretty good, and I believe accurate, rant on this:
The flood insurance program was created by Congress in 1968 to fill a void: because of the risk, few carriers provided flood insurance. Now, private insurers offer flood insurance in a partnership with the government — but taxpayers shoulder all the risk. It has turned out to be a bad bet. The program is $18 billion in debt, a sum the government acknowledges probably will never be paid back by premiums, and it is likely to need a new multibillion-dollar infusion to pay claims from Hurricane Sandy. It is long past time for the government to stop subsidizing home and business owners who live and build in dangerous flood zones.
Homeowners and businesses should be responsible for purchasing their own flood insurance on the private market, if they can find it. If they can’t, then the market is telling them that where they live is too dangerous. [emphasis added] If they choose to live in harm’s way, they should bear the cost of that risk — not the taxpayers. Government’s primary role is ensuring the safety of its citizens, so the government’s subsidizing of risky behavior is completely backward.