Washington Warming to National Disaster Plan Idea
National News • March 16, 2007
A proposal for a national disaster plan to backup private hurricane and flood insurance markets appears to be gaining momentum in Washington.
This week, Rep. Barney Frank, D-Mass., chairman of the ...
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Subject: RE: Move Away???
Posted On: March 16, 2007, 2:44 pm CDT
Posted By: Actuary
Comment:
It's just not true that all other areas of the country have large scale catastrophic risk. For example, Upstate NY, Vermont, Western Mass, & Western CT don't have those risks. They may have extreme weather but nothing approaching the destruction that accompanies hurricanes. The Insurance Commissioner in Florida promotes that idea to get people to climb aboard.
There are a number of subsidies that Americans accept with minimal complaint. Agriculture is subsidized at both ends (via Farmers & Food Stamps) because it's a necessity and stable food costs contribute to a stable economy. Taxes from more populous states are used to fund projects in states that would have difficulty financing them on their own. Again, people rarely squawk about their federal dollars going to build roads they'll never drive on because it promotes a common good.
Most social programs have a needs test to determine whether or not a person is eligible for the subsidy. Proponents of disaster funds and the suppression of property rates want the subsidy for all, regardless of the individual circumstances. There are people in Florida, like those in New Orleans, that do not have the resources to help themselves. They are native to the state and wouldn't know where to go if they were forced to move. On the other hand, there are baby boomers retiring and moving to Florida. They have assets that were acquired during the last 30-40 years -- a period of economic growth unseen in the history of the world. Now they ask us to subsidize their insurance. It just doesn't seem right.
Those that are promoting government solutions need to address the following question. Consider the following situations.
1. A professional couple in their 20's with infant children has a $200,000 home with 5% equity and a 30-year fixed rate mortgage. Things are tight for them now but they expect things to get better as their careers develop.
2. A professional couple in thir 40's with teenage children have a $200,000 home and 0% equity. They've taken out the equity obtained from the appreciation of the real estate to go on trips and to pay for private school for their children. They expect that things will be that way until the kids move out after college.
3. A retired couple with a $200,000 home with 100% equity. They've raised their kids and with their pension and social security are looking forward to relaxing and enjoying life.
Should they all have the same level of government assistance for their insurance?
With the current system, and the identical house, we're being asked to help pay for their insurance regardless of the individual's financial situation. This is on top of the tax break that comes from being able to deduct mortgage interest from their taxes.
If someone can come up with an equitable way to help those that are in need, I'm for it. As it stands now, the state of Florida uses a machete to carve out the subsidy instead of a scalpal. I lived and worked in Florida and I'm glad I got out when I did.
Subject: RE: Move Away???
There are a number of subsidies that Americans accept with minimal complaint. Agriculture is subsidized at both ends (via Farmers & Food Stamps) because it's a necessity and stable food costs contribute to a stable economy. Taxes from more populous states are used to fund projects in states that would have difficulty financing them on their own. Again, people rarely squawk about their federal dollars going to build roads they'll never drive on because it promotes a common good.
Most social programs have a needs test to determine whether or not a person is eligible for the subsidy. Proponents of disaster funds and the suppression of property rates want the subsidy for all, regardless of the individual circumstances. There are people in Florida, like those in New Orleans, that do not have the resources to help themselves. They are native to the state and wouldn't know where to go if they were forced to move. On the other hand, there are baby boomers retiring and moving to Florida. They have assets that were acquired during the last 30-40 years -- a period of economic growth unseen in the history of the world. Now they ask us to subsidize their insurance. It just doesn't seem right.
Those that are promoting government solutions need to address the following question. Consider the following situations.
1. A professional couple in their 20's with infant children has a $200,000 home with 5% equity and a 30-year fixed rate mortgage. Things are tight for them now but they expect things to get better as their careers develop.
2. A professional couple in thir 40's with teenage children have a $200,000 home and 0% equity. They've taken out the equity obtained from the appreciation of the real estate to go on trips and to pay for private school for their children. They expect that things will be that way until the kids move out after college.
3. A retired couple with a $200,000 home with 100% equity. They've raised their kids and with their pension and social security are looking forward to relaxing and enjoying life.
Should they all have the same level of government assistance for their insurance?
With the current system, and the identical house, we're being asked to help pay for their insurance regardless of the individual's financial situation. This is on top of the tax break that comes from being able to deduct mortgage interest from their taxes.
If someone can come up with an equitable way to help those that are in need, I'm for it. As it stands now, the state of Florida uses a machete to carve out the subsidy instead of a scalpal. I lived and worked in Florida and I'm glad I got out when I did.