A Stitch in Haste

Words escape me:

One day after Donald Seither's mobile home was ripped up by Hurricane Charley, the 74-year-old retiree picked up a friend's phone and pleaded for federal aid.
...
About a week later, a check from the U.S. Treasury came in the mail. Here, Seither figured, was the hundreds, maybe thousands, of dollars he and his wife would need to help rebuild their lives. Then he opened the envelope and read the fine print. The check's value: $1.69.
...
For residents who spent much of the past two weeks living amid rubble without electricity, it can feel less like help and more like a slap in the face.

"I fell to the floor and I started to cry," said Seither, recalling his disappointment when he opened the envelope.
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He said he's not ungrateful but can't believe the federal government would go to the trouble to mail him a check for such a pittance. "It's an insult," he said. "I would rather have gotten nothing."
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[A FEMA spokesman] said it was impossible for him to say why a FEMA official decided to award Seither the exact amount he received. Aid requests are assessed case by case and are based on several factors, including the extent of a victim's insurance coverage and how much damage he or she can document.
...
Seither said he's not going to cash his check. He's holding on to it as a novelty item. Someone already has offered him $24 for it, he said. Now he's considering auctioning it on eBay.

Kip's bookie lays even money odds that somewhere there's a law making it illegal to sell government checks as novelty items.

"Say what you want about New York -- we don't have earthquakes, we don't have hurricanes and we don't have tornadoes!" --My Father

"No, we just pay for them..." --Me

Conceptually, if not economically, FEMA is perhaps the single most insidious government program in America. If you buy a house, then buy insurance -- especially if you choose, voluntarily, to live in an area susceptible to such phenomena. Federal disaster aid only serves to create moral hazard and agency problems and a general misallocation of resources.

But if you're going to engage in such an inefficient and unfair reallocation of resources, then at least do it, um, efficiently and fairly (efficaciously and intelligently?):

Four months after a string of hurricanes ravaged sections of Florida, the Federal Emergency Management Agency remains under attack -- for giving out too much money.
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"There was no significant weather pattern in Miami Dade at the time there was $30 million distributed to the people," said U.S. Rep. Robert Wexler, D-Fla. The eye of Hurricane Frances missed Miami by more than 100 miles. FEMA checks, however, paid for more than 5,000 new televisions, 1,000 microwaves and nearly $8 million worth of storm-related rent.
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FEMA officials originally said they used weather charts from the government's National Weather Service that showed 85-mile-per-hour winds. Government meteorologists say the charts weren't theirs and their information shows winds topped out at 53 miles per hour in Miami Dade.

For perspective, here's a reprisal of a post of mine from August, showing the flip side of this nonsense, called "We're from the Government and We're Here to Help" --

One day after Donald Seither's mobile home was ripped up by Hurricane Charley, the 74-year-old retiree picked up a friend's phone and pleaded for federal aid.
...
About a week later, a check from the U.S. Treasury came in the mail. Here, Seither figured, was the hundreds, maybe thousands, of dollars he and his wife would need to help rebuild their lives. Then he opened the envelope and read the fine print. The check's value: $1.69.
...
For residents who spent much of the past two weeks living amid rubble without electricity, it can feel less like help and more like a slap in the face.

"I fell to the floor and I started to cry," said Seither, recalling his disappointment when he opened the envelope.
...
He said he's not ungrateful but can't believe the federal government would go to the trouble to mail him a check for such a pittance. "It's an insult," he said. "I would rather have gotten nothing."
...
[A FEMA spokesman] said it was impossible for him to say why a FEMA official decided to award Seither the exact amount he received. Aid requests are assessed case by case and are based on several factors, including the extent of a victim's insurance coverage and how much damage he or she can document.
...
Seither said he's not going to cash his check. He's holding on to it as a novelty item. Someone already has offered him $24 for it, he said. Now he's considering auctioning it on eBay.

So in some instances the money is doled out on a "case by case" basis. In others, it's based on weather maps. And the bureaucrats are going to insist that the politics of pull has nothing to do with it?

Scrap, or at least overhaul, this failed agency now.

As hurricane season ramps up, here's the latest FEMA embarrassment:

The Federal Emergency Management Agency has asked thousands of Floridians whose homes were damaged by last summer's four hurricanes to give back more than $27 million in aid overpayments.
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Many of the problems stem from FEMA providing money for items that were later covered by property insurance policies, from more than one person from the same household applying for benefits or from processing errors.

FEMA has committed more than $5 billion to Florida's hurricane recovery.

If it could be demonstrated that there is some sort of market failure in the homeowner insurance industry, then perhaps the government could consider establishing an "insurer of last resort" program comparable to the federal flood insurance program (although I'm not sure that federal flood insurance was needed to correct a market failure either). In any case, given that these homes are (Kelo notwithstanding) private property and that a functioning private insurance market clearly exists, then why is FEMA even involved?

Hurricanes aren't rare, unforeseeable events like earthquakes or tsunami, and although they may be catastrophic for individual property owners, they are rarely crippling to an entire local economy. The government is simply playing too fast and loose with the definition of "disaster." Which means, of course, that they are also playing too fast and loose with our tax dollars.

Insurance is a fundamental cost of owning property, no different than electricity, air conditioning or plumbing. It's a private expense stemming from private property enjoyed by private individuals. It can be, and therefore should be, strictly privately financed.

From the Washington Post:

So many residents in Florida's Panhandle were tired of it Tuesday. Hurricane Ivan had stomped through the region in September, and many homes and businesses here were still wearing blue tarpaulins over their scars from that storm when Dennis roared ashore at 120 mph.

Tired of the destruction. Tired of the power outages. Tired of the lines for food and gas and water and ice.

Well guess what, Florida Panhandle — I'm tired of it too!

I'm tired of having to subsidize your being tired of it. I'm tired of my taxes funding the Federal Emergency Management Agency and its perpetual subsidization of your lifestyle, "tired" or otherwise. I'm tired of the whole "private benefits, social costs" paradigm that underlies your whole region.

News flash: Hurricanes strike Florida. Hurricanes strike the Gulf States. Deal with it, and pay for it yourselves, the same as you pay for air conditioning or lawn sprinklers. Either that, or move.

When a real (i.e., unforeseen) disaster strikes, I'll be ready, checkbook in hand, to help out. But hurricanes are not unforeseen, they are business-as-usual. So too are the politics of hurricanes and the taxes that stem from it.

And I'm tired of it all.

UPDATE: Some people are figuring it out --

For Linda Campbell, a minister who conducts weddings on the beach, leaving the waterfront means leaving behind part of her livelihood. But after three hurricanes in a decade -- including two in the past 10 months -- she and her husband have joined other repeat storm victims who are now planning to sell their Florida Panhandle homes and move away from the water for good.

"How much more can we take?" asked Campbell, whose barrier island home on Navarre Beach sits near the spot where Hurricane Dennis rolled ashore Sunday. "I kind of feel like I keep experiencing a death over and over again."

The Campbells live in a "stilt house" -- perhaps the most thumb-your-nose-at-nature gesture humans can undertake. How can you build a house that's not even on solid ground and not expect trouble every time a storm comes?

Ouch!

A sea operation was launched to "free willy" after a groom suffered a zipper incident on a remote island.

The rescue took place on Arranmore Island, in Ireland, which is about five miles off the mainland.

The groom was celebrating his stag party with friends when disaster struck with his trousers in the early hours.

He was forced to call out the Royal National Lifeboat Institution (RNLI) to rescue him from the island. The groom was taken to Burtonport, where an ambulance transferred him to Letterkenny General Hospital.

RNLI spokeswoman Nora Flanagan said the man was in agony. He said: "Talk about the unkindest cut of all."

Now regular readers of this blog know that I would never include a gratuitous genitalia post without some libertarian angle. So here it is: I hope the RNLI sends the groom a bill for their services.

Just as people should have to pay for their own hurricanes, or blizzards or other recurring "disasters," so too should they have to pay for their own self-made "disasters."

Consider the analogy from the criminal side. We not only fine or imprison wrongdoers, but we also make them pay restitution to reimburse the victims, or the government, for the damage they cause, if it is easily measurable. If we exact restitution for intentional acts, then why not do so for reckless or negligent acts, or just plain bad luck? Why should every Irishman bear the (not insignificant) cost of launching a sea rescue over a stuck zipper?

Another analogy: It's often argued that the rich should pay higher taxes because they have more for the government to protect (e.g., via the police or fire department). Just as those who want higher auto insurance coverage pay higher premiums, so too should the rich, who are "more insured" by the government's public safety programs, have to pay more for that protection through higher taxes. Fair enough, but auto insurance companies also get to seek reimbursement for their payouts from those who are responsible for accidents, either directly through subrogation or indirectly through higher premiums to the insured.

If public safety is viewed as a form of public insurance, then the government, as the public insurer, should try as much as possible to match costs with those who impose them. Such a system is both efficient and equitable.

Still, I hope the traditional marriage night activities were not too badly disrupted. (Did I just say "traditional marriage"?!? Oh dear, how Rick Santorum of me...)

The latest round of proposed military base closings has some politicians crying foul:

The Air Force wants to retire aging aircraft from many Guard units, close or consolidate some of their bases and give some units new missions, like flying remotely piloted Predator aircraft, that are better suited to today's national security environment, Air Force officials say.

But doing that would leave more than two dozen states without emergency aircraft to fight fires, recover from hurricanes and cope with other natural disasters, lawmakers say.
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[Pennsylvania Governor Ed] Rendell said closing the base would infringe on his authority to deploy Pennsylvania guard personnel and would strip the state's efforts to prevent a terrorist attack and respond to natural disasters.

To the extent that the federal government has contractual obligations to the states to provide a certain minimum support of National Guard operations, then the affected states may have a valid gripe.

But the "local disaster" argument is a totally different matter and a totally invalid argument. It is not, or at least it should not be, the federal government's obligation to subsidize states' disaster preparedness infrastructure.

Obviously individual states are not allowed to acquire their own fighter jets or nuclear submarines. But there is nothing whatsoever preventing states from acquiring their own rescue planes, helicopters or boats, nor is there any reason why those states especially prone to forest fires, hurricanes or earthquakes cannot incorporate emergency preparedness into their own public safety infrastructure.

Nothing, that is, except their own fiscal stinginess. They want the airplanes — they just don't want to have to pay for them.

Why exactly should taxpayers in New York pay for National Guard units in Pennsylvania that serve no purpose except to benefit Pennsylvanians? Protecting our air space is a truly federal public good and should be provided, and paid for, with federal tax dollars. But local disasters are, um, local and preparations for them should be provided, and paid for, locally.

State politicians should not try to bolster their contractual arguments with "local disaster" appeals to the Politics of the Warm Fuzzy Feeling. If they have legal arguments to make, then make them. But don't tell me that I should have to pay for their local problems.

UPDATE #1: Pennsylvania Governor Rendell and the state's two (Republican) senators are now suing to block the closure of a Reserve unit. Of course, if the State of Pennsylvania offered to fully fund all the expenses of the unit from now on, then the Pentagon probably wouldn't mind keeping the unit active. But somehow I doubt that's what the Keystone Cops Politicians have in mind.

More thoughts at Arkanssouri.

UPDATE #2: Pennsylvania has won its lawsuit against the Department of Defense. You can now expect any base closing that affects any National Guard unit to be challenged by state politicians. I still say that if a state wants to maintain a unit for, say, emergency preparendness, then let the state pay for it.

or, "What's in Your Wallet?"

The federal government plans to begin doling out debit cards worth $2,000 each to adult victims of Hurricane Katrina, The Associated Press has learned.
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The unprecedented cash card program initially will benefit stranded people who have been moved to major rescue centers such as the Houston Astrodome.

"They are going to start issuing debit cards, $2,000 per adult, today (Wednesday) at the Astrodome," said Kathy Walt, a spokeswoman for Texas Gov. Rick Perry.
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It's unclear how much the debit card program will cost the government, but it's likely to run into the hundreds of millions of dollars since hundreds of thousands of people have been displaced.

I think this sets a dangerous precedent, for several reasons:

--If Katrina victims were able to evacuate, then you'd think they were able to evacuate with their wallets. How exactly is money the issue here? If they need food, water, clothing, diapers, etc., because those items are unavailable (i.e., at any price), then shouldn't we be providing those supplies rather than money? Did the flood somehow waterlog everybody's currency?

--How long do you think it will be before we see reports of people using their debit cards to buy beer, or cigarettes, or trading them for illegal drugs?

--Of course Katrina was a unique disaster, but what criteria will be used in the future for a direct government-run cash handout to be established? "Oh sorry, only 10,000 homeless from your flood, no debit cards for you." "Sorry, debit cards require a 7.0 on the Richter scale and you only had a 6.9." "Giant meteor fell on your house — so what?"

--Why should cash handouts be limited to natural disasters? If a crazed arsonist burns down my house and only my house, then I'm displaced too, so should I get a $2,000 debit card?

If there's some logistical reason why a cash handout is more efficient than direct aid, then let's hear it. But it certainly goes against the tradition of providing those in need of relief with, um, relief rather than a windfall.

POST SCRIPT: What is doesn't go against, on the other hand, is the new tax-and spend Republican fiscal policy of "too much is never enough." Go figure.

UPDATE #1: JunkYardBlog --

But I can see how the race and povery [sic] pimps may play the cash cards. The cards are going out to adults, one per, in each family. So a pair of yuppie evacuees with zero kids will get 2 cards, value $4k. A single mom with four minor kids will get 1 card, value $2k.

I'm pretty sure I don't qualify as a "race and poverty pimp," but I also think that discrepancy is outrageous. Kids are people too.

UPDATE #2: The program has been scrapped.

We may soon find out:

Lawmakers and watchdog groups worry that allowing federal employees to charge up to $250,000 on their government-issued credit cards for Hurricane Katrina-related expenses will lead to a repeat of past abuses.

Some of the cards in the past were used to pay for prostitutes, gambling activity, even breast implants, government audits have shown.
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About 250,000 federal employees have government credit cards, which typically have a purchase limit of $2,500. At the request of the Bush administration, Congress increased the credit line to $250,000 as part of a massive Katrina recovery bill approved last week. The aim is to make it easier to speed aid to victims.

Senate Finance Committee Chairman Charles Grassley, R-Iowa, said the "outrageous increase" was "slipped" into the bill. He is seeking to insert language in a Katrina health bill that would reduce the limit in most cases to $50,000.

My first question is: What's $250,000 per bureaucrat times 250,000 bureaucrats?

My second question is: Should there really be 250,000 federal employees with government credit cards under any circumstances?

My third question is: How exactly does it help Katrina victims to have so many bureaucrats have so much credit at their disposal? Are they all personally going to the local Wal-Marts to buy diapers for the families?

My fourth question is: Where is all this money is going to come from, given that, according to senior congressional tax-and-spend Republican Tom DeLay, "there is simply no fat left to cut in the federal budget"?

POST SCRIPT: The answer to the first question is $62.5 billion. Hope you have your credit card handy when the tax bill comes due.

The Office of Management and Budget has revoked the outrageous expansion of credit limits on the government-issued credit cards of 250,000 bureaucrats to $250,000 each, which could have potentially led to $62.5 billion of Katrina-inspired pork, fraud, waste and mismanagement.

Some cards in the past were used to pay for prostitutes, gambling activity, even breast implants, government audits have shown.

"To further strengthen the protections that we have put in place to guard against fraud and abuse, we are asking that agencies operate under pre-hurricane levels unless they can justify to us that there are exceptional circumstances," said Clay Johnson III, OMB's deputy director for management.

This was the Politics of the Warm Fuzzy Feeling stuck on stupid. Bravo to OMB for pulling the plug. (Hat tip to Government Bytes.)

---

On a related note, the government also canceled the equally outrageous $2,000 debit card program for hurricane victims. Getting scarce supplies to Katrina victims was one thing, but unless all the ATMs were flooded, a shortage of cash was simply not the problem and debit cards were not the solution.

I was critical of both the $2,000 FEMA debit card program in response to Hurricane Katrina (apparently so was FEMA — the program was canceled after only three days) and the ludicrous granting of $250,000 credit lines to 250,000 bureaucrats on their "official business" credit cards.

Well, score two for me:

On the federal government's long shopping list for hurricane relief: $223,000 for flip-flops, $153,600 worth of underwear, three golf carts rented for $1,500 a month and flyswatters for $5.28. Oh, and four packs of playing cards bought by the United States Forest Service, for which records list no price but do offer an explanation: "to help morale during Hurricane Rita."
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Did the Environmental Protection Agency really have to buy CamelBak backpack-style water containers for $2,024 (quantity not given), or could their workers have used ordinary plastic bottles? Why did the Forest Service spend $547 on a "horse trough"? (An agency spokesman could not say, but a salesman at Port Allen Hardware in Louisiana says it was used as a "giant ice chest" to keep drinks cool.) What about $89.37 for treatment of a toothache for an emergency worker at a mobilization center in Marietta, Ga.?

Expect a GAO report, followed by a lot of political huff-and-puff, followed by a Congressional investigation, followed by more huff-and-puff, followed by...absolutely nothing.

Meanwhile, Snopes has a roundup of abuse of the $2,000 debit card program:

One of the first news outlets to report on abuse of these financial instruments was the New York Daily News, who [sic] broke the story that two of the cards had been used in Atlanta to buy $800 Louis Vuitton handbags. (That claim has been substantiated by MSNBC's Abrams Report; the store confirmed to them that it happened.) Others have been spotted in adult entertainment venues — according to a report by KPRC Channel 2 in Houston, the wife of a strip club manager in that city said her husband has seen patrons from Louisiana offering FEMA and Red Cross debit cards. A manager at Caligula XXI Gentlemen's Club told KPRC that he has seen at least one card used at his club. "Abby," a bartender at Baby Dolls, another strip club in Houston, said customers are paying for drinks with what may be FEMA or Red Cross debit cards.

As I blogged previously, unless all the ATM machines in New Orleans (not to mention Houston) were flooded, the problem in the Katrina crisis was not a shortage of money, but a shortage of materials. The government should have focused on getting stuff to New Orleans, not dollars.

On the other hand, given the current political histrionics over the (not quite yet) avian flu (maybe someday) crisis, perhaps we're lucky the federal government didn't seize Wal-Mart and Home Depot outright.

More thoughts at Catallarchy.

Label me cruel and inhumane, but I think five and a half months is enough and the Hurricane Katrina and Hurricane Rita "hotel people" should be persuaded to come up with alternatives.

FEMA and a federal judge agree:

A judge let the federal government Monday drop some 12,000 families made homeless by last year's hurricanes from a program that has put them up at hotels nationwide.

FEMA has promised the evacuees from Hurricanes Katrina and Rita that they will still receive federal assistance that they can use toward hotel stays or fixing their ruined homes, although the agency will no longer pay for the hotels directly.

Attorneys for the evacuees tried to get U.S. District Judge Stanwood Duval to issue a temporary restraining order, saying the forthcoming money from FEMA won't be enough for reasonable living accommodations or for hotel stays.
...
In Louisiana, officials offered shelters to those leaving the hotels, but according to FEMA, only one family needed sheltering.

Keep in mind that this ruling was not about cutting off victims' aid entirely or about evicting them from the hotels. FEMA simply wants to stop direct payments to the hotels -- hotels not just in the area but across the country, including here in New York City. And still some advocates and activists are upset.

Clearly at some point this money has to dry up and this program wind down. Personally I think 30 days would have been sufficiently generous; 90 days would have been erring on the side of benevolent caution.

But almost six months? Skyscrapers can be built in less time, but temporary dormitories can't be? That's not disaster relief, it's bureaucratic inertia.

Those who owned their homes should have received their insurance checks by now. Those who are simply going to walk away from it all and start over somewhere else have had adequate time to make plans, or at least to "make plans to make plans." And the remainder can be surely be housed somewhere other than a New York City hotel.

We should not be at the end of the beginning, or even the beginning of the end. This should be the end of the end. As heartless as it may sound, enough is enough.

And while we're on the subject -- where's New York City's disaster money for our recent blizzard?

More thoughts from The Phalanx.

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Back in October, I blogged the following:

Expect a GAO report, followed by a lot of political huff-and-puff, followed by a Congressional investigation, followed by more huff-and-puff, followed by ... absolutely nothing.

Well, here's the first part:

The GAO report found that up to 900,000 of the 2.5 million applicants who received aid under the emergency cash assistance program -- which included the debit cards given to evacuees -- based their requests on duplicate or invalid Social Security numbers, or false addresses and names.

In other instances, recipients improperly used their debit cards intended for food and shelter for $400 massages, a $450 tattoo, a $1,100 diamond engagement ring and $150 worth of products at "Condoms to Go."

See also this previous post.

Of course, "guilt by association" is not a valid reason to criticize the hotel program -- these people needed shelter. But note the past tense -- "needed." It's time to move on and clean up the fiscal wreckage from Katrina and Rita as well as the tangible wreckage.

All Related Posts (on one page) | Some Related Posts:

1. Ladies and Gentlemen, Malibu is Burning...
2. FEMA to Taxpayers: Drop Dead
3. What Price Perfection?...
5. Do the Katrina Hotel People Have "Tenant Rights"?
6. Check-Out Time for Hurricane "Hotel People"
7. Spending Like a Drunken Bureaucrat...
14. "It's the Most Blunderful Time of the Year..."
15. FEMA Based Payouts on Weather Maps, Not Actual Damage
16. We're from the Government and We're Here to Help

I blogged a few days ago about how FEMA has, finally, cut off direct funding for Katrina victims to stay in hotels.

Well, at least one hack New York politician (and I ask again — why are displaced people from Louisiana and Mississippi staying in hotels in New York?) has decided that these guests in our city might not be mere "guests" after all:

Charlie King, a lawyer and a Democratic candidate for New York State attorney general, said the evacuees in New York City would be protected by city and state housing laws and could not be thrown out without a formal eviction proceeding, which could take months.

This is, of course, utter nonsense.

Hotels are not "housing" and hotel guests are not "tenants" and housing laws cannot reasonably be deemed to apply to them.

And how exactly would this hack politician propose enforcing these housing laws? By suing FEMA? By suing the hotels? Or by simply forcing New York City or New York State to start picking up the tab as federal money dries up?

Here we have yet another example of the danger of arguing reductio ad absurdum, namely that your opponent may end up embracing the absurdity. This is an especially likely outcome when dealing with politicians, bureaucrats and special interest "advocates."

Keep in perspective exactly what King is suggesting. These people may be "victims." They may not be (wholly) responsible for their plight. But that doesn't change the fact that they are on the dole. They are receiving taxpayer-subsized handouts that are now stretching into their sixth month.

And yet, we are told, these people not only have "rights," but that have more rights than regular hotel guests who actually pay their way (do you really believe that you are a "tenant" protected by housing laws when you go on vacation and stay in a hotel?).

Using taxpayer money to aid disaster victims is one thing. Elevating victims above taxpayers is something else entirely. And entirely illegitimate.

...is, perhaps ironically, its Chief Privacy Officer:

After a nine-month search, the Department of Homeland Security has appointed mid-level homeland security lawyer Hugo Teufel III, who has no formal experience in privacy compliance, to be the Chief Privacy Officer for Homeland Security.

While the Department interviewed prominent and experienced privacy officials both from the corporate world and within the government, Chertoff instead chose a loyalist lawyer with no real experience in the field of privacy policy.

Lovely.

As Wired notes, there is certainly a need for more attention to privacy matters within DHS agencies, most notably the Transportation Security Agency. But more to the point, how is it that Homeland Security Secretary Michael Chertoff — whose department is on double not-so-secret probation after Hurricane Katrina — be allowed to appoint yet another flunky to any position, let alone an important and high-profile one? Granted, Chertoff did not appoint Michael Brown to head FEMA (President Bush did). Nevertheless, the department as a whole has a taint that should not be ignored.

They just don't get it.

And is there any part of the government that needs to "just get it" more than Homeland Security?

---

Meanwhile:

Lawmakers say that since the Homeland Security Department's formation in 2003, an explosion of no-bid deals and a critical shortage of trained government contract managers have created a system prone to abuse. Based on a comprehensive survey of hundreds of government audits, 32 Homeland Security Department contracts worth a total of $34 billion have "experienced significant overcharges, wasteful spending, or mismanagement," according to the report, which is slated for release today and was obtained in advance by The Washington Post.

The two greatest obstacles to wise decision making are urgency and politics. Put the two together and "overcharges, wasteful spending, and mismanagement" are all but assured.

In what is apparently considered "news," some "experts" inform us that "perfect" implies "expensive" --

With solid concrete walls and roofs and laminated glass windows protected by storm shutters, a house can be built to withstand nearly any hurricane. But very few are.

Even in the most vulnerable U.S. coastal areas, virtually no one builds homes or buildings to survive a Category 5 hurricane -- a monster storm with winds higher than 155 miles per hour (250 km per hour) that can crush ordinary houses.

It costs too much.

Gee, you think?

This is, of course, nothing new. You can build a perfectly safe car -- but it would be a tank and cost a million dollars. You can design a perfectly crack-proof egg carton -- but eggs would cost $10 each. You can reduce pollution to perfectly zero -- but it would require that we live like cavemen.

One would hope that such subjects are covered in an introductory economics class. We could think in terms of "units of safety," in which case each "unit" would cost ever more money -- as in the Law of Increasing Marginal Cost. Or we can think in money terms -- each additional dollar yields an ever-diminishing level of added "safety" -- as in the Law of Diminishing Marginal Returns. Or we can think of how useful additional "units of safety" become as the calamity that they anticipate become ever more remote -- as in the Law of Diminishing Marginal Utility. Or we could think in terms of when it makes more sense just to spend money on insurance rather than disaster-proofing -- as in the Law of Increasing Opportunity Cost.

What would have been a more useful news story is how the government disrupts all these economic laws and interferes in these economic decisions by subsidizing potential disaster zones. Why bother deciding how much "safety" to buy, or how much insurance, when the government (i.e., everybody else) will pay for your disaster after the fact? Whether it's FEMA, flood insurance, presidential disaster declarations or plain old pork barrel spending, when the government subsidizes an activity, you get more of it, including disaster damage. That should also be a topic in introductory economics -- hopefully.

Since astronomy is in the news, let's revisit my meteorite example from a previous post. If one meteorite smashes through my living room window, the federal government would do absolutely nothing about it. I would be told, quite properly, "too bad so sad."

Yet if a meteor shower were to rain down and smash 100,000 living room windows, then suddenly it becomes a "disaster" and the government would be expected to "do something" to help the "victims."

That simply cannot be right.

And it would be even less right if I and my neighbors chose to live in an area known to suffer from meteor showers. We should have been expected to figure out how much "meteorite safety" (or private meteorite insurance) to buy and take our chances.

So too with areas prone to hurricanes, or earthquakes or floods or forest fires or blizzards or locusts or whatever. You know, or should have known, the risks (i.e., the costs) of living where you do. Plan accordingly. Build accordingly. Insure accordingly.

That would be an inexpensive kind of "perfection."

FEMA Director David Paulison on Meet the Press:

MR. RUSSERT: So the money will get directly to the people, but when they get it they won't be able to use it on tattoos or guns or condoms-to-go, as was evidenced with Katrina?

MR. PAULISON: I don't have any control once we give people money. Normally, we put money -- either give them a check or wire directly to their bank account. Once they get that money for, for issues the Congress has allowed us to give people money for, how they spend it is out of our control. You know, that's an individual choice. So if they take that money, waste it on something else and don't rebuild their home with it or don't replace a car or don't pay medical expenses, you know, that's, that's a personal decision they have to make. We simply give them the dollars they're allowed under law, and then they should be spending it on what it's given to them for, but we don't have any control once we turn those dollars over to them.

This is, of course, utter nonsense.

The government has been limiting handouts to in-kind assistance since the creation of the welfare state. Food Stamps go to, um, food. Tuition assistance goes to, um, tuition. Fraud exists, to be sure, but it is minuscule and not dismissed with a bureaucratic shrug.

Or the government could instead direct aid to agencies, such as the American Red Cross or local hospitals and shelters, rather than to individuals.

And of course, taxes -- unlike the handouts that they fund -- are anything but "an individual choice." So such a statement becomes especially obnoxious.

Now as any good student of economics knows, to some extent this is merely a question of appearances. If you were planning to spend $50 on food and I give you $50 worth of food, then you might very well spend the original $50 on something other than food, something I would not endorse. So be it.

But what's wrong with keeping up appearances? What's wrong with taxpayers demanding that, if disaster "victims" are going to defraud us, then they should at least have to work at it? Why should we catalyze the process by pretending that it's "just another cost" of disaster relief?

FEMA should not sit idly by, allowing disaster aid abusers to piss on our shoes and then telling us the levee broke.

A modified version of comment I left on another blog regarding the Malibu fires:

This "why should I have to pay for it!" is a popular lament, especially among right-wingers. ... The argument is that it's your own fault for living in a fire-prone (or hurricane prone, or tornado-prone) area. But unless you've found some patch of land completely immune to any and all acts of God, I've got a big steaming cup of STFU for you.

First of all, the mid-Atlantic comes pretty close: No hurricanes, no earthquakes, no floods, no forest fires. The occasional Buffalo blizzard is about all. So remind me again who deserves the "big steaming cup of STFU"?

But more to the point, the idea that "susceptible to acts of god" is binary rather than relative is wholly untenable. The notion that, with respect to the potential for natural disaster, building (or living) in San Francisco or Miami is the probabilistic equivalent of building (or living) in Connecticut or Utah is, quite frankly, asinine.*

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When confronted with such assertions (i.e., that disaster relief is irrebuttably presumed to be a legitimate public good), I always seem to return to my meteorite example: If a single stray meteorite smashes through my window, then it's my problem. But if a massive meteor shower smashes every window in my city, then it somehow becomes the government's (i.e., the taxpayers' — i.e., your) problem? That simply cannot be right.

And if that can't be right in the context of a truly location-independent example such as meteor showers, then it even more certainly cannot be right in the context of those who wilfully, with full information beforehand, choose to live in a region with a greater chance of disaster. There is nothing "cruel" about the common sense principle that one should bear the cost of one's choices, both ex ante (i.e., via insurance) and ex post (i.e., no taxpayer aid).

I can (perhaps) forgive those who fall into the trap of the Broken Window Fallacy and try to legitimize disaster relief on the (incorrect) assertion that such redistributionist actions are an economic stimulus. They are not. But to simply shrug off any need to justify such a policy in the first place, to default down to a kindergarten "STFU" position, further demonstrates just how devoid of both economic analysis and common sense some apologists for the "everybody pays for everything for everybody else" style of central planning can be.

More thoughts at no third solution.

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*Note that federal disaster declarations clearly show a lack of uniformity in "disaster likelihood" even despite their having been skewed by political expediency; a reality-based distribution would be far more unbalanced than even these politically influenced data. The idea, for example, that a "severe storm" in New York State is truly a "disaster" at all, let alone the functional equivalent of a major hurricane in Florida or Texas (or Louisiana), is laughable.

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Chuck at Howling Point, who lives in Escondido (just outside San Diego), has been live-blogging the Malibu fires.