A Government Flood
The government created the flood--written in 1999 about a different (but similar) flood). "Ignoring science and experience, military engineers consistently marched to the tune of the "levees-only theory," which in practice requires a huge capital and maintenance expense to build and maintain these ever-higher earth- and stoneworks to hold back the floodwater.A levees-only approach caused sediment to accumulate on the river bottom forcing engineers to regularly raise the level of the levees to hold the same amount of water. The mighty Mississippi River had literally been lifted above ground level in many places. It is obvious that this strategy created the potential for increasingly severe flood damage.
Comments (20)
Here is some more information about the origin of Federal Flood Control.
Published: September 1, 2005 7:38 PM
Over the last three days, I have come across the argument that private developers are to blame for all the lost property in New Orleans' flood, i.e. "they shouldn't have built houses in areas below sea level."
There is simply no reasoning with such people. You explain why it was government that was to blame, and you get blank stares.
Published: September 1, 2005 8:23 PM
I will never trust my life and property to government built levees.
It's now looking like I shouldn't trust the government to protect my life and property from others.
But they a good job of taking money out of my paycheck.
Published: September 1, 2005 9:11 PM
While most of the attention is on New Orleans, we should not forget the catastrophic damage to coastal property up to 100 miles to the east. It is hard to see how any technology could have been put in place to withstand the 28 - 35 ft surge. Governor Hayley Barbour, the devout Christian that he is, would do well to reflect on the Gospel according to St. Matthew, and put in a prayer for the poor people who perished because it was the end of the month and they did not have any money to buy gas or take a bus to get out of town:
"7:26And every one that heareth these sayings of mine, and doeth them not, shall be likened unto a foolish man, which built his house upon the sand:"
"7:27And the rain descended, and the floods came, and the winds blew, and beat upon that house; and it fell: and great was the fall of it."
Published: September 1, 2005 9:25 PM
Wait, poor people are like the foolish man who perishes because he does not heed the words of Christ?
Just because there's a flood doesn't mean it's time to quote scription mentioning floods but otherwise has nothing to do with what's going on. I know it probably wasn't your intent to imply that those who lost there homes are foolish men ignoring the words of God, but that's what it looks like.
Published: September 2, 2005 12:20 AM
If the increased frequency / intensity of these events is attributable in any part to man then one can argue that man contributed to this event.
I am no environmental nazi, just an observation which I think points to costs from externalities not included within 'market' transactions.
Published: September 2, 2005 5:59 AM
One cannot keep people from building and living in hurricane strike areas, but one also does not have to subsidize such behaviors. If there is no truly private market for insurance in such locations, it is for a good reason. This is a harsh but real truth.
Published: September 2, 2005 6:20 AM
There was a book written about 15 years ago about the flood control of the Mississippi River (The Control of Nature, by John McPhee). Its a pretty good book and highlights the fact that this has been a loosing battle for decades, only nobody is willing to admit it (or stop throwing money at it).
Published: September 2, 2005 6:59 AM
There has been mention here (and in Lew's piece) about creation of the Mississippi River Commission (or somesuch name) as though that were an event in the federalizing of authority. I have no dispute with the record but would point out that the Constitution itself clearly places navigable waterways under such authority.
In Holland, it has apparently been decided that land-winning has been too ambitious over past centuries and has thus made too much of the country vulnerable to storms of somewhat greater magnitude than so far experienced (but in no way out of the question). Currently, I understand there are plans to "give back" over 60% of the land won from the sea while also improving dikes and pumping capacity, in order to provide better protection for the less ambitious holding.
Published: September 2, 2005 7:31 AM
Jonathan,
I think it's a ridiculous and completely unproven assertion -- as some environmentalists are making -- that these things are caused by "global warming". They can't even prove that global warming is occuring, and they haven't done such. Despite that, anyone who challenges the global warming hypothesis is accused of being a mouthpiece for corporations (as if the global warming crowd gets no funding from environmentalists). Even if they do prove there is global warming, they still haven't, and probably never will, prove that it's occuring because of man. Temperature variations throughout geological time are enormous, and the environment is constantly changing; it was so warm in the Middle Ages that Greenland was actually green. That wasn't particularly harmful.
Even if they can prove global warming, and prove that it's caused by increased CO2 levels from human activity, so the heck what? This isn't something caused by any particular actor -- that is, it isn't the moral responsibility of any particular person -- but has to be considered as a natural result of economic activity. The proper response to this is to allow free people to react accordingly in the free market. You'd think the human-hating environmentalists would be thrilled with this, considering that CO2 is great for plants, and considering such statemetns as:
Clearly, these people are dimwitted evil wackjobs, who can't be reasoned with. Nothing about global warming can properly be considered an "externality", since doing such requires engaging in utopian dreaming about some perfect never-never-land that can't possibly exist, and that government will actually take us further away from than libertarianism.Furthermore, as for actual serious concerns about pollution -- e.g., smog polluting farmer's orchards -- the externalities argument is bunk. Courts had been treating such things as tort, and acting accordingly, until Common Law Courts overturned earlier decisions, ruling that there was something more important than private property rights, and that is "the public good". As for anyone who harbors any illusions, the free market is clearly better for the environment than is socialism and State-interventionism, because the free market avoids the tragedy of the commons. The worst environmental disasters have all occured under socialism or interventionism. Look at the USSR. See DiLorenzo, Thomas. Why Socialism Causes Pollution.
Published: September 2, 2005 8:25 AM
Hurricane frequency and severity are cyclical, occurring in patterns that last decades. Ending in the late 1980's we came out of a period where the frequency of intense hurricanes had been low, and are now in approximately the middle of the intense cycle again. People in the insurance industry have known about this for many years, I have on my nightstand at home a paper written in 1998 by the Dallas CPCU chapter on this topic (interestingly it has about two pages on Camille and the destruction in Port Christian). Give it 15 more years, and the hurricanes will calm down ..
Another well-known fact in the insurance industry is the devastation that would be caused by a category 5 striking New Orleans. One item I read 4+ years ago (when managing product for LA for my employer at that time) predicted 100,000 dead in that event.
A large part of this tragedy is the hubris of man in general, and the Corps of Engineers in particular. The expansion of New Orleans in the 1930's was based, in part, on arrogance that they could defy the forces of nature and expand the city (onto what otherwise would be swamp) through their engineering expertise. This period of U.S. history is filled with these projects - we have large, thriving communities across this country that could be destroyed by a single dam failure, and we have very few rivers undammed in this country.
Urban planning to promote dependency on public transport should shoulder its share of blame as well. Disaster-prone areas near the coast, or near volcanos, often use policy to promote high densities and discourage automobiles, when low densities and lots of automobile use are what really helps an evacuation effort ...
Published: September 2, 2005 9:03 AM
David, I am no expert in this field but would be very surprised if man has not had any effect, positive or negative, on the environment. Even if he has, I believe I am probably as sceptical as you are with regards to statist methods to 'fix' it.
I am somewhat suspicious about externalities however, as they do impose costs on people not involved in the transactions. I am sure there are loads of examples but one close to my heart (and over my head living in central London) is flight paths! I assume in a libertarian world the airlines should enter into contracts with everyone under proposed flight paths but I cannot imagine anyone other than a lawyer would seriously propose such an idea.
Published: September 2, 2005 9:16 AM
...just an observation which I think points to costs from externalities not included within 'market' transactions.
According to the Insurance Information Institute, Flood damage is covered only by the National Flood Insurance Program. So if private insurance companies wouldn't provide flood insurance to New Orleans homeowners, or would only do so at tremendously high prices, then it sounds to me like the market did consider the externalities, but the federal government intervened and caused the externalities anyway. Did the market or the government encourage people to live in a city largely below water level? If it weren't for the political decisions of the federal, state and local governments involved in New Orleans, a lot fewer people would have been at risk from Hurricane Katrina, because the market would never have caused or encouraged so many people to live in such a vulnerable area.
But I suppose the statists will find some way to blame this disaster on the market. Anything to avoid the consequences of their own policies and ideology.
Published: September 2, 2005 9:25 AM
There was a guest on financialsense.com who noted that the Oceans have a generation long cycle. The last set of big hurricanes were during the 1930s, which is normal, then it settled down starting in the 1950s when everyone started looking at the Gulf Coast and Florida property again. During 1940 no one wanted to live near "hurricane alley" because they remembered the disasters. During 1990 no one remembered very many bad hurricanes, except people with very gray hair.
One silly assumption is that people can assess risk properly or even with moderate accuracy. If so, then why did people crowd into the NASDAQ at 4000 pushing it over 5000 before it collapsed? Many people would go uninsured, but there would be costs for disasters even if insurance didn't pay for them. And the people in NO for the last few generations weren't flooded out, merely inconvienienced by hurricanes.
Even if you can assess risk accurately, fortune has a way of upsetting plans. Did any or all of the readers buy gasoline futures because they expected today it would be over $3.00/gal? What about their businesses who are impacted? There are many "thousand year flood" scenarios, and we each will probably experience several in our lifetimes. The problem is we won't know which ones.
Does anyone know if Mt. Ranier will blow? Tell me oh delphic oracles of risk what the insurance rates ought to be for the valley below? Or if LaPalma will cause a megatsunami in the coming decade? Would anyone insure the east coast up to a few hundred feet (lots of miles inland)? Or if we get another Tambora eruption or a year without a winter?
Insurance will fix everything? Not a chance. They are human enough so that the insurance companies occasionally collapse, but they aren't prophets. And big events happen often enough to overwhelm anything I've seen proposed as ways of making the private sector work. No, you can only transfer so much risk. And that amount is probably smaller than anyone thinks.
Published: September 2, 2005 1:37 PM
tz,
I don't think there are too many here who think insurance will fix everything. We just question what value government has provided with its promises of security, safety, and recovery. We just see the moral hazard as being greater, much greater than it has to be.
Published: September 2, 2005 1:51 PM
So, tz, how much were private insurers charging for flood insurance in the New Orleans area? Of course there are limits to assessing risk, but like any other venture, the diversity of private industry helps mimimize the disasters, whereas governments really tend to go overboard when they get it wrong.
Published: September 2, 2005 2:16 PM
Lew:
Yet another excellent article. However, you are preaching to the choir. What a wonderful thing 20/20 hindsight is. However, living in an earthquake zone in California, the hurricane Katrina experience has come as a wake-up call – it gives me an idea of what I can expect in the way of relief from State run services. Since I have little expectation of any change in the level of these services, I better prepare to fend for myself and family.
The disturbing thing is how complacent and unprepared I am. So, I think it is high time that I stop procrastinating and put together the emergency survival kit that I will need when the big one hits. It is clear that the recommended 3 day supply of food and water is inadequate. Since water appears to be the key to survival, a hiking kit with a good water filter plus iodine and chlorine would be a good investment. A radio and flashlight that do not require batteries would also seem to be a good idea. I have not yet figured out how to resolve the communication problem if phones and cell phones don’t work. I would advise the other bloggers who live in California to do the same and to share any good ideas they have.
Published: September 2, 2005 3:44 PM
I'm simply stating that the severity cycle of hurricanes, lasting typically 2-3 decades, and the possibility of calamity in New Orleans, are and were well-known facts in the insurance industry. Neither of those statements are a claim of delphic knowledge, nor a claim that insurance would "fix everything."
The current crop of enviro-nazis wanting to blame the increased severity of hurricanes in the last 15 years will be eating crow (or taking credit LOL) in around another 15 years, and by the time most of us reading this are senile or dead, we'll be in another severe cycle. It's related to, among other things, rainfall patterns in sub-saharan africa and the position of the bermuda high pressure system. If I haven't expatriated by then, or if I go to mexico, I will be looking for atlantic coast real estate, I reckon it will be cheaper, relatively speaking, in a few more years.
There is no such thing as private flood insurance in the U.S. Flood insurance is run by the federal government, with eligibility and rates set by the bureaucracy. Studies show that only about 60% of those eligible actually buy it, I don't know what the percentage was in NOLA. This is a classic case of a subsidy that has made the situation worse.
Concerning the investments - I haven't done any commodity futures investments, I am in real estate, physical gold, physical lead (encased in brass), stocks, and funds. I considered liquidating some stocks to buy VLO based on their exposure to sour crude, but declined since I think my current portfolio stands to gain anyways, and I didn't want the tax hit on my gains. I was already long on several old-economy stocks that will probably benefit ...
Published: September 6, 2005 8:35 AM
Flood insurance was not only not available in New Orleans, but in the entire country before Katrina. That's why the national flood insurance program (NFIP)came into being in 1968. However, a few private flood insurance policies are now in force - for very wealthy people in little to no risk zones. http://www.env-econ.net/2006/04/the_increasing_.html
One problem with the flood policy in the US is that there is no one to enforce flood risk planning. The NFIP is supposed to promote wise development in floodplains, but it has little to no teeth. When the Corps builds levees, the NFIP removes or reduces the official risk of structures behind those levees based only on the word of the Corps. No one besides the Corps and the levee districts checks levees to ensure their capabilities. The Corps has now admitted that the levees were not actually built strong enough to withstand a Category 3 hurricane, though the people living behind them had no idea until it was too late.
Also, not all of New Orleans flooded. The house I live in has not flooded once since it was built in the 1830s, because it is not below sea level.
I agree that much of my home city is indefensible, and that we should not rely on flood structures but on sound building and planning policy. However, we just spent 150 years believing that science and engineering could defeat nature, and it is taking some time for our country to realize that this is not the case. The people in New Orleans were not stupid, but merely the same as other Americans, believing that US government and science had already mediated the flood problem here.
New Orleans is an important port and oil and gas center, generating a lot of income (much of which immediately leaves the state, unfortunately). It doesn't make sense to give up on the region or to abandon the idea of flood insurance wholesale. The issue, even within the few square miles of New Orleans, is complex. Anyone who believes in easy answers or clear good v. bad guys (e.g. the Corps or environmentalists) will not help us create economically or socially responsible solutions.
Perhaps one of the best sites for information and ideas on flood planning is the Association of State Flood Plain Managers. http://www.floods.org/home/default.asp Flooding happens all over, as this spring and summer demonstrate. There are no easy or perfect solutions, but there are better ways to manage the risks, and neither liberals nor conservatives have a monopoly on wise planning.
Published: July 6, 2006 2:15 PM
"Flood insurance was not only not available in New Orleans, but in the entire country before Katrina. That's why the national flood insurance program (NFIP)came into being in 1968. However, a few private flood insurance policies are now in force - for very wealthy people in little to no risk zones."
You are saying: Flood insurance was not available in the entire country until 2005, that's why the national flood insurance program came into being in 1968.
I'm sorry, you make no sense.
Published: July 6, 2006 5:50 PM