OT-- N. Orleans insurance

If you take an urban city like New Orleans, how many people actually own their own homes and thus subject to mortgage requirements for carrying Flood Insurance? I'm certain it's a lot less than 65%!

Now, did they look at just property owners w/ Flood Insurance, or did they also look at renters w/ FI, too? That's just my general observation...those raw numbers alone don't paint a whole picture.

Of the people who owned property to rent, then you get into whether it was financed property or owned outright, and if owned outright if they took the risk of not paying for the insurance.

Most places it's the land that's most valuable, not the actual structure. So you're a slum lord. So you own a building outright that's only going to cost $50-75k to rebuild. Land under it is worth $100k. That'll still be there afterwards. So you take the risk, say screw it, I make more money now, and if the storm knocks it down, I rebuild, the rents cover the rebuild cost easily, I'm out a some equity but within 15 years I'll have it all back.

As to Buickanddeere's point, I'm a bit more nuanced.

I have a *big* problem with using flood insurance to allow new development in very risky areas. Used to be the typical example was the 2nd homes on the ocean front -- although they've become more strict on that, I still don't see a lot of social value in subsidizing the wealthy to have seaside retreats.

For existing communities located decades and centuries though, it is a way to continue with life without undue economic disruption.

Think of New Orleans if Flood Insurance wasn't available -- what bank would loan money to buy homes there? The people who already owned property wouldn't be able to sell; property prices would spiral down; and you'd see an existing community completely collapse.

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BTW...one story I listened to NPR was from a middle class Black family from the 9th Ward -- the radio person jokingly asked that it sounds like you need a MBA to fill out the forms, and the woman laughed -- her sister has one, and she's three classes away from earning hers and they both had agreed the forms where tough! Anyway, of her extended family they had lost 9 homes, but everyone except one uncle had Flood Insurance.

How about we limit building where there is a lack of fresh water...that eliminates much of the western states...they're having serious problems with water now..

The northeash...only problem there is snow..not much of a big deal as it can be pushed away.

So..in reality, the coastal areas are popular whipping areas but remember the flooding along the Mississippi? Problems everywhere.

Building 9 feet below sea level in an area that should expect strong hurricanes is _not_ acceptable. That is a double whammy - setting yourself up to fail.

It is just plain silly to spend gobs of money to rebuild the low-lying spots. Of course rebuild New Orleans, and the rest of the coasts that were so devistated.

But the govt controls my low ground, I can't even plant crops in a 'wetland'. how the heck can these folks rebuild houses in that sunken wetland????

That is foolishness.

--->Paul

(Although I can't stand it when they look for Federal Aid just because it was an unusually big snow storm...It snows here, live with it!)

'38 Hurricane that hit us still ranks in the top 10 in lives lost. City I work in had 94 fatalities from the '53 Worcester Tornado. And I live in an area that's protected by a large series of Corps of Engineers dams so that dozens and dozens of mill villages and small cities remained economically viable after the severe flood hazard they were at became realized.*

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Ok, one final aside before bed...

Many of those villages it may not have been unreasonable to build originally. Many started in the 1830s, in communities dating to the early 1700s.

One might argue there wasn't a lot of historical knowledge of floods yet...BUT --

One of this summer's reads was Man & Nature, written by George Perkins Marsh in 1862 <-- Yes, 1862 as in Civil War time.

And one of his observations from then in New England was increasingly worse flooding caused by poor farming practice -- not only where hills being denuded to low-value farming reducing the forest cover to slow the run-off...the soils being lost where silting up the rivers and raising the river beds.

Adding my own interpretation to the "big picture" you get this:

The biggest reason for the mass push cutting down the forests where to grow more sheep for the Mills that were built, and provide fuel for the railroads that ran to the Mills. And losing forests and losing soil as side effects of needing wool and fuel...caused the villages to become much more likely to flood.

Prior to the "great Merino Wool Craze" in the 1830s, New England farms tended necessarily to rotate -- they'd clear new land for crops, when fertility declined they'd move on and the old land would re-forest and re-cover. With sheep, you didn't need manpower to tend the fields...cut all the trees down (railroads made a market for the wood), grow sheep. Before Mills, Sheep, and Railroads you had maybe 10-20 out of every 200 acres in use for farmland at a time. After the 1830s any where you could clear trees was put into marginal production.

Which is all to say...some of these communities, whether in New England or on the Mississippi or elsewhere may have not be that all unreasonable in regards to flooding when they were built, but the unintended consequences of later developments made them much more vulnerable.

You buy flood insurance on the dwelling and/or contents. If you live in a flood plain and you don't finance, it's up to you whether you get any kind of insurance at all. It would be stupid to live without insurance. At least the house insurance....flood insurance...depends on how much you can stomach risk...if you can't stomach it, get it.

New Orleans..there is some commentary that there were about 85,000 flood policies written for homes there. That's the minority of homes. Most didn't have it. They are flat out of luck. They get nothing. Those that had it will collect to the extent of the policy if the house is totaled and ....most will be.

What do the people do without insurance....nothing,,,,unless the federal government provides something...read this as your taxes.

The only other thing the uninsured can do is claim a capital loss on their income taxes. Remember, they will only reduce their taxable adjusted gross and will only save to the extent of their tax rate.

I hope this is clear and answers some of your questions.

His back yard is not as big as it should be. There is a steep berm going up from the back of the house. House in 3rd lowest in the subdivision.....

Well, that berm is the back wall of a sanitary landfill. A big one, for the Twin Cities area of Minnesota. Big, big dump pit. It's full, sealed over. Was sealed before the housing development went in.

As you look out the window, you see airplanes. They are next to a mid-sized municiple airport. Been there for over 1/2 a century.

Why do people buy in such locations?

--->Paul

There is no such thing as "fair". The politically connected will win every time..been that way for years and years. The not politically connected lose. Not fair you say? That's the American way...the majority rules.

Do you think that the southern people are happy with the influx of northerners into their cities taking over the local politics and changing generations of life styles?