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Continuing the Conversation
On 3/2/23 we had with us
Robert Wright, Senior Research Fellow at the American Institute for Economic Research
What if we PRIVATIZED Disaster & Emergency Responses?
According to Ike Brannon at the Cato Institute, between 2014 and 2018 America suffered annually 13 storms, each of which cost over $1 billion. Further, almost half our population lives in flood-prone coastal areas, or in three states - Florida, Texas and California - rife with natural disasters. Between the National Flood Insurance program subsidizing risky housing and the 1988 Stafford Act putting the feds on the hook for a majority of disaster recovery expenses, we have guaranteed over-spending that only privatization can avoid.
Governors already have started disaster privatization, at least through the use of contractors to avoid waste in the delivery of FEMA cleanups or HUD rebuilding. But, only by replacing the subsidies with insurance can we truly get to a free market for disasters.
If privatized, disaster response would be cheaper because insurers would charge higher premiums for families wanting to build in flood-prone areas. Disaster response would be better, too, if privatized. Higher allowable prices would attract entrepreneurs to disaster areas to bring goods and services faster to those in need, and charity would prioritize the needy. Mr. Wright has other benefits in mind from a government-free disaster response market, as well.
Mr. Wright is the (co)author or (co)editor of over two dozen major books, book series, and edited collections, and has (co)authored numerous articles for journals including the American Economic Review, Business History Review and Independent Review – and he has taught business, economics, and policy courses at NYU’s Stern School of Business, Temple University and the University of Virginia.