National Flood Insurance: Yet Another Program in Need of Market-Based Reform

Looking for yet another costly federal program in need of market-based reform? Put the National Flood Insurance Program (NFIP) near the top of your list. It is a mess, and time is running out to fix it. As sea levels rise and extreme weather events trigger inland flooding, NFIP offers property owners insurance against flood damage at rates that do not come close to reflecting the true risk of losses. It compounds the problem by insisting that money it pays out in claims can be used only to rebuild in the same flood-prone locations—not for moving to higher ground.

There are lots of ideas for a makeover of NFIP. One obvious one would be to charge property owners full risk-based premiums. However, owners resist that measure because it would crash the value of their properties. Another reform would let owners use claims to rebuild in other, safer, areas. However, local governments where the flood-prone properties are located resist that idea because they would lose part of their tax base. Still another idea is to buy out whole communities at fair, pre-flood prices and rebuild them elsewhere. However, powerful realtor and builder lobbies resist all these reforms.

Congressional committees have been working on promising fixes. Reform proposals have been worked up to the point of being ready for a vote. But—did I mention?—Congress has less than two weeks to do something. NFIP expires at the end of September. The pressure to reauthorize it without substantive changes will be overwhelming. 

Here is some background reading if you want to pursue the cause of building a market-based National Flood Insurance Program:

• SmarterSafer.org is a coalition that promotes risk-based insurance and risk mitigation efforts. Its website is a trove of information and links.
• The National Resources Defense Council has a great, short backgrounder on the need for flood insurance reform.
• An excellent article in The Atlantic by Michelle Cottle outlines the politics of flood insurance reform.

 Reposted from NiskanenCenter.org

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If you Like Sanders' Healthcare Plan, Please Stop Calling it “Single Payer”

The latest version of Bernie Sanders’ Medicare for All plan (MFA) has a lot to like. Sanders is right, America needs a healthcare system more like those of other wealthy countries. But, if you like Medicare for all, please stop calling it “single payer.” The single-payer label distracts attention from the main goal of healthcare reform, it energizes the opposition, and it is not an accurate description of the Sanders plan.

The goal is universal access

Single-payer is not the goal of healthcare reform. The goal is universal access to health care. No, not “access” in the sense some Republicans use it, that is, as the opportunity to buy into the system if you can afford it. True universal access would mean a system in which anyone who needs health care can go to the doctor’s office, the hospital, or the pharmacy and get what they need with the certainty that they can afford it, no matter how modest their means.

Single-payer is better understood as one way of getting to the goal of universal access. Under a true single-payer system, when you went to get care of any kind, you would just show your healthcare ID card and the government would directly reimburse the provider in full. That would be nice. The problem is, no such system exists anywhere. Not even in the universal access systems we admire most—Sweden, the UK, New Zealand, or whichever is your favorite. In all of those countries, the government pays some of the healthcare bills and private sources pay some. As the chart shows, the government contribution is greater than it is in the United States almost everywhere, but it is not 100 percent anywhere.

Can Angola's New President Overcome the Curse of Riches?

The people of Angola did something recently that they had not done for a long time: They elected a new president. The winning candidate, João Lourenço, will take over from President José Eduardo dos Santos, who came into office in 1979. Lourenço, who is from the same party as dos Santos, the People’s Movement for the Liberation of Angola, received two thirds of the vote. That result is expected to stand, despite doubts about the count voiced by his opponents.

During the first two decades of dos Santos’ rule, Angola struggled with a deadly, on-again, off-again civil war. After the MPLA prevailed in 2002, Angola embarked on a peace-and-oil expansion, with GDP growing by an astonishing 22 percent in 2007 alone. The global financial crisis brought the Angolan economy back to earth, however. The following chart, from the latest FocusEconomics Consensus Forecast for Sub-Saharan Africa, details the slowdown. Not only has the growth of GDP slowed, but so have analysts’ estimates of future growth. Low oil prices, and the expectation that they will remain low for the foreseeable future, are a major factor behind the growth pessimism.