Flood Insurance, debt monster

[garbon]

I'm only taking a conclusion that has been drawn by the gov't of New York.

As to your second point - I'm not sure how that doesn't lead to Joan's tongue and cheek point. A great many places would have to or would be abandoned if we dropped gov't support and forced people to pay a "fair" premium with regards to their likelihood to get flooded out. (Or as HVC pointed out - inhabited by those who just wouldn't take on said insurance and still would need gov't assistance.)

[DGuller]

I'm only taking a conclusion that has been drawn by the gov't of New York.

Not the most impartial observer.

As to your second point - I'm not sure how that doesn't lead to Joan's tongue and cheek point. A great many places would have to or would be abandoned if we dropped gov't support and forced people to pay a "fair" premium with regards to their likelihood to get flooded out.

If some place has to be abandoned because a fair flood premium would cost too much, then it should be abandoned.  The underlying reason for that would be that the benefits of that place are outweighed by the cost of regular flooding.  Subsidizing such expenditures doesn't solve the problem;  on the contrary, it exacerbates it.  This is about as basic as economics get:  costs should be paid by those who incur them if you want efficient allocation of resources.

[garbon]

If some place has to be abandoned because a fair flood premium would cost too much, then it should be abandoned.  The underlying reason for that would be that the benefits of that place are outweighed by the cost of regular flooding.  Subsidizing such expenditures doesn't solve the problem;  on the contrary, it exacerbates it.  This is about as basic as economics get:  costs should be paid by those who incur them if you want efficient allocation of resources.

I'm not sure I agree with that if the upfront cost is more than the incremental costs for a good long while. Not to mention the cultural and historical loss that can't easily be quantified in economic terms.

[viper37]

the one thing private insurance is really good at is not paying out insurance

I never had serious problems with my insurane companies.  Then again, I do read the fine prints.