Let’s stop making disasters more disastrous — VOICES for REASON

Now that a federal court has found the U.S. liable for post-Katrina flooding in New Orleans, the federal government will be pouring tax money down yet another drain hole in the name of disaster relief. The court found that the U.S. Army Corps of Engineers was grossly negligent in maintaining a vast network of levees and flood control structures that were supposed to protect New Orleans. The court-ordered damages must be paid from tax funds along with the costs of rebuilding. Said a Los Angeles Times article: “The federal government has promised tens of billions of dollars in post-storm rebuilding aid to Louisiana. The Justice Department has estimated that the total outstanding civil claims could amount to billions more.”

This is not a shocking development. Once Uncle Sam took on the job of flood protection for a city situated in a below-sea-level bowl, it was readily foreseeable that any negligence would increase the population’s exposure to the kind of disaster that Katrina brought. Yet despite the obvious hazards, government policy continues to be formulated as if New Orleans has an unquestionable right to continue defying nature at taxpayer expense.

Although there’s no easy solution to the legal miasma in Louisiana, such tragic situations can be avoided in the future—if America’s policy makers are willing to question the wisdom of government programs that actively promote building and living in disaster-prone areas. As I wrote in a previous op-ed, government policy makes disasters more disastrous by erecting a “so-called safety net composed of government policies that actually encourage people to embrace risks they would otherwise shun—to build in defiance of historically obvious dangers, secure in the knowledge that innocent others will be forced to share the costs when the worst happens.”

But the solution is not more of the market distortions and perverse incentives that have lured so many people into harm’s way. The solution is to replace the prevailing entitlement mentality with a free market in disaster prevention, insurance, and recovery.

In a free market—without tax-paid levees, government disaster relief, or subsidized insurance—anyone who contemplates building or buying property in a high-hazard area will need to face hard facts about the local history of natural disasters, the efficacy and cost of preventive measures, and the availability of insurance.

For example, the high price—or total unavailability—of private insurance will resound like a clanging alarm bell, signaling the market’s objective view that a particular building plan is abnormally risky compared to less dangerous locales.

With their own lives and wealth at stake, people will have every incentive to evaluate risks objectively. And if hardy souls still choose to occupy and fortify New Orleans, or build on an earthquake fault, or live in a tornado alley, the risk and reward will be theirs alone. No longer will government make disasters more disastrous by pretending that citizens have a right to defy the forces of nature at others’ expense.

America has postponed the need for radical reform far too long. The spectacle of post-Katrina lawsuits yielding billions of dollars in damages should be enough to spark serious debate.

Image: Wikimedia Commons