Why Obama Should Support Delaying Biggert-Waters Flood Insurance Hikes: Opinion

By Michael Hecht | January 28, 2014

  • January 28, 2014 at 1:30 pm
    bob says:
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    now obtain an opposing view, please. this is blatantly one sided – what would you expect from somebody from New Orleans?
    $22 billion in debt, and he wants to continue to add to it.

    • January 29, 2014 at 3:13 pm
      Bill Price says:
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      I understand that people in New Orleans get 100% Flood Insurance for free. (Located behind an ACOE Levee.)
      Why shouldn’t the Corps pay for rebuilding, not folks with Flood Insurance.

  • January 28, 2014 at 1:55 pm
    jack says:
    Poorly-rated. Like or Dislike:
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    Hidden due to low comment rating. Click here to see.

  • January 28, 2014 at 2:26 pm
    Bill Price says:
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    Has anyone seen a Comprehensive Financial overview of the NFIP?
    A Congressional Research Report shows $5.5 billion surplus 12/31/11 and 6 months later, a $17.5 billion deficit.
    I don’t understand this.
    Bill Price

    • March 3, 2014 at 1:17 pm
      ssx1 says:
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      Its simple government accounting – show a surplus when its politically convenient and a deficit when its politically expedient! Its hurricane season just prior to an election and you need people to feel comfortable knowing the government has their backs? Don’t worry, we have $5.5 Billion in the bank to help you rebuild of a hurricane floods your homes! Now you want to stop the other party from making across the board budget cuts? “How dare they take money from a program that the middle class depends on in times of crisis that’s already $17 Billion in debt to give tax cuts to the rich!”

  • January 29, 2014 at 11:16 am
    Squandered Youth says:
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    Legislative reform is needed because, as currently administered by FEMA, the existing scheme does not work, but this Administration, which views FEMA as a favored child, isn’t going to do anything about it. The President and the other opponents to S. 1846 are willing to let FEMA proceed on its current course, even if there is widespread agreement that, in a disturbing number of individual cases, the current schemes produce absurd, arbitrary, unpredictable and unfair results that inflict unnecessary harm on people who have “played by the rules.” Like B-W and FEMA itself, the GAO numbers don’t take into account the damage B-W does to the economy through its impact on property values and reasonable investment expectations – or the consequences to the national disaster relief budget of driving anyone in their right mind not mandated by law to maintain coverage out of the NFIP. A statute that could cost everybody else $200 billion to retire a $25 billion deficit is a bad deal.

    The President’s reference to limiting relief to “economically distressed policyholders” and FEMA’s lament that “affordability” requires looking at everyone’s income and expenses suggests that what they have in mind is something like the college financial aid program in which the Government selects who it feels truly “needs” to be spared from premiums that don’t make sense and impose unfair burdens on homeowners. There should not be means-testing for basic fairness.

  • January 29, 2014 at 12:14 pm
    Brian says:
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    Good piece Mr. Hecht. I too live in New Orleans and renovate and resell houses for a living. After being told by my insurance agent that my flood policy will be assumable, I went ahead and renovated a property. Since then I have found out that the policy is not assumable and am stuck with an unsellable house. As a result, I cannot continue to purchase more property (that are currently blighted and out of commmerce), I cannot continue to employ workers such as carpenters, electricians, plumbers, etc. This issue goes well beyond the rates of flood insurance. The Biggert-Waters Act was a poorly thought out push to make to the NFIP solvent, even though, as stated previously there was a surplus prior to Sandy. America has lost its long term view of economics and is purely focused on the short term.

  • January 29, 2014 at 2:50 pm
    Bryan says:
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    Never a good idea to use one risk as an example. You need to understand the concept of insurance. The risk isn’t being rated because of itself. It is being rated because of it and all the similar risks across the country.

    Just because an insurer has positive surplus does not mean its rates are adequate or it is in good financial shape. Pretty sure NFIP has been in financial trouble for over 2 decades, and not because of mis-management.

  • January 29, 2014 at 3:12 pm
    WK2 says:
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    Of course mis-management has something to do with the NFIP troubles. One only has to remember or research how poorly claims were handled during Katrina to know this. When has the government ever not mis-managed money? We joke about $250 hammers and $500 toilet seats the differing agencies have purchased because there is a basis of truth there. While many things contribute to this mess we should at least accept part of it is poor management of funds.

  • January 29, 2014 at 3:58 pm
    Bryan says:
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    Many things contribute to all messes. Looking at it that way, mis-management is the source of all problems that have ever occurred.

    My point was that if everything had been managed perfectly since the inception of NFIP (I understand the obsurdity of this statement), then we would still face the same problem we face now. NFIP would still carry massive debt and have to borrow to pay claims.



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