A Stitch in Haste

Perhaps because the private insurance industry would never tolerate an insanity such as this:

A major public policy issue before the 109th Congress is the cost to the [National Flood Insurance Program] of paying for repetitively flooded properties ["RLPs"].
...
In total, there were 4,498,324 flood insurance policies [as of September 30, 2004] — so RLPs are 1% of the total policies nationwide. Yet, according to FEMA, this 1% accounts for an annual average of 30% of amounts paid in claims.

If you're a "repetitively crashing driver," you're banished to a high-risk insurance pool with appropriately higher insurance premiums. Eventually, you're barred from driving altogether.

Could you imagine trying to run an auto insurance company where 1% of drivers were responsible for 30% of claims? Or a health insurance company? Is the private insurance industry unable to provide flood insurance because of market failure (as the government would have you believe), or merely unwilling to provide it because of public policy irrationality in tolerating repeat victims?

More:

[A]lthough RLPs exist in all 50 states, five states — Louisiana, Texas, Florida, North Carolina, and New Jersey — accounted for 63% of all repetitive loss payments from 1978 through 2004. The top 10 states accounted for 78% of all repetitive loss claims; and the top 25 states account for 96% of all repetitive loss claims.

Forgive the bad pun, but flood insurance money has been pouring into Louisiana on a regular basis for over 25 years. Remind me again how "nobody saw this coming"?

Flood insurance, and the apparently non-negotiable rebuilding of New Orleans, may well be the ultimate manifestation of the doctrine of "private gains, public losses" that underlie much of our disaster policy. Why is it so outrageous to ask people who know their property floods repetitively not to come crying to the federal government because "they had no idea this could happen"?

As the saying goes: "Don't pee on my leg and tell me the levee broke."