Natural Disaster Insurance -- What If...?

December 16, 2013

We enjoyed reading Heber Taylor’s column “When is an answer not an answer?” (Wednesday, December 4th).  It stated… the biggest concern involving the federal government is not Benghazi or Iran or even ObamaCare.  It’s flood insurance.  It continues, “officially” our elected representatives want to delay the implementation of rate increases until an affordability study is conducted, but their real position is the federal government ought to get out of the storm insurance business.  To paraphrase Mr. Taylor, they want to kick the can down the road and delay the inevitable in order to appease their constituents.

We think it might be productive to conduct kind of a public brainstorming session on this subject -- asking a series of “What If” questions and bringing some ideas to the table – and see what you, our readers, think.  As a ground rule, we’d like to suggest that all comments be respectful, not attacking any individual(s) while also encouraging a free flow of ideas. 

We’d like to start of by sharing some things we see as foundational.  

• First, philosophically we believe that whenever possible the free market should determine what goods and services are bought and sold and at what price.  The free market works!  When there is a demand, goods and services will be provided.  When the cost is too high, the demand will wither away and the goods and services will either be offered at lower prices or go away entirely.  This applies to the insurance business as well as the bread and butter you purchase at the store.
  
  
• Second, we believe any national insurance program – be it natural disaster, flood, or even ObamaCare – should be guided by what is authorized by the U.S. Constitution.

So let’s look at what the U.S. Constitution has to say.  Article I, Section 8 of the Constitution gives Congress the authority to raise taxes and spend money.  A key question is whether Congress has the power to spend money on projects/programs that go beyond the powers specifically given to it by the Constitution or if Congress is limited to spending on only those things mentioned in the Constitution.  It is clear that the Congress cannot spend money on anything it wants, especially those things within the jurisdiction of the states. The drafters of the Constitution wisely created limits, limits that promote efficiency and the protection of our individual rights and freedoms.

There are some things, however, that go beyond the jurisdiction of the states and which also  promote the “general welfare,” but are not enumerated in the Constitution.  For example, the Louisiana purchase.  No one state was prepared to buy this land and it was appropriate for the federal government to make this purchase back in 1803.  Spending on the space program is another example where the general welfare of the country is involved and which is beyond the ability of individual states to accomplish -- spending money on the space program is not an enumerated power in the Constitution but it was, and still is, an appropriate expenditure. 

So, next week we’d like to start this public forum.  We’ll ask a series of “What If” questions, encourage your comments, and see where this leads us!

Bill, Mark, and John