The Taxpayer Subsidizes Those Houses Falling into the Sea
Don’t build your home on sand, especially shifting sand.
A little over a year ago I wrote a piece about how the homes of millionaires are subsidized by the American taxpayer through the Federal Flood Insurance program. I made the point that the homes one sees up and down the East Coast of the United States which are built right on top of beach protecting, and erosion reducing sand dunes, would not be there if it was not for lobbying by powerful industries and individuals for such a program.
As someone who has lived much of my life in and around the ocean these homes which stand like sentinels on the shore have always blown my mind. Having watched home after home fall into the sea on the local news, year after year, I often wondered how it was even possible to build a home so close to the ocean. It made no economic sense. These big rental houses sit perched right next to the mighty Atlantic Ocean on a sand bar. Sand bars are not stable. How could people afford to lose these homes, even very wealthy people? Then as an insurance underwriter after college I leaned. The homeowner mitigates almost all of his risk with insurance that is subsidized by you and me.
For those who don’t know much about beaches, they are very dynamic areas. Inlets emerge and then go away. A barrier island which one day could be 1000 feet wide could be gone in a hurricane or a solid nor’ easter. It is sand. It is meant to move. It is not meant to be built on. It is not wise to build any structure which one wants to last on sand, especially sand which is often wet.
But thanks to the Federal government we make it economically viable for people to construct massive buildings on areas of the coastline which should be inhabited by nothing more than pelicans, sandpipers, and ghost crabs. And I am not making an ecological argument here, I’m making an economic one. If it were not for the rest of America backstopping a relative few very wealthy homeowners and developers building on sand dunes would be in no way economical and our beaches would be much more healthy to boot. Yet President Obama and Congress don’t see things as I do as Reason reports.
“Four months before Hurricane Sandy hit the East Coast, President Obama quietly signed legislation expanding the federal program that offers taxpayer-subsidized flood insurance to ocean-front homeowners.
The law extended the National Flood Insurance Program for five years while also opening the program for the first time to multi-family properties like beachfront condominiums. The flood insurance provisions were part of a bill known as the Moving Ahead for Progress in the 21st Century Act that passed the House 373 to 52 on June 29 and the Senate by 74 to 19 the same day. President Obama signed it into law on July 6 with remarks that dwelled on the transportation spending and student loan-related language in the Act, but made no mention at all of the flood insurance.”
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