Colorado Springs: When firefighter Eric Morris shows up at wildfires across the West, locals battling the flames sometimes look at him and wonder who sent him.
The answer isn’t a public agency. It’s an insurance company.
Morris is among a group of private firefighters hired in recent years to protect homes with high-end insurance policies. In a wildfire season that is one of the busiest and most destructive ever to hit the region, authorities and residents say their help is welcome.
…For insurers, hiring them is worth the cost. They spend thousands on well-equipped, federally rated firefighters, potentially saving hundreds of thousands, if not millions, of dollars to replace a home and its contents.
Private fire fighters benefit the insured and also the non-insured because the extra manpower lets public firefighters divert their attention elsewhere. Since there are spillovers, private firefighters are under supplied.
Hat tip: Tyler Watts.
On the other hand, private firefighters in those conditions are bound to apply themselves inefficiently, concentrating too much on protecting insured properties, and unable to act strategically.
Did you even read the entirety of Tyler’s post?
Alex…..
It amazes me that regular readers cannot identify who wrote which posts, even without looking at the title.
This is exceptionally Tyler-y writing for Alex. But in general, I agree
FDA, organ donation, patent reform, etc. are some of Alex’s pet topics.
Private firefighters are Alex-y, but a two sentence post with no editorial content is Tyler-y.
You’re also assuming that private firefighters are a net addition to rather than cannibalizing the supply of public firefighters, a dubious assumption in my opinion. If private firefighters are mostly redistributing rather than adding to the human resources available for fighting fires, then it is a net loss for the non-insured.
8% unemployment, but a static pool of firefighters? Interesting theory…
If you sampled that 8% unemployment crowd what percent would qualify for wildfire fire fighter training?
Whatever that percentage, it is higher today than it was at the outset of the recession. The idea that there is only a small pool of firefighters that neither grows nor shrinks, over the course of years, is untenable.
Won’t this objection really torpedo the stimulus ideas for lowering unemployment, too?
Its very very hard to get a job as a friefighter even at 0 wages and with qualifications.
I’m always surprised at this type of comment. We get it all the time here in Canada when the issue of private health care is discussed. At the same time that we watch a large proportion of doctors trained here relocate to the US to work in private health care.
Is it beyond anyone’s imagination that maybe, just maybe there are a large pool of people that are not willing to work for government, but are willing and able to do work that is usually done by government? I worked for government for a couple of years and saw demoralized, disincentivized people gradually losing their ability to compete and function in the real economy. I got out, smart people do. Or those who want to stay sane.
firefighters are not trees rooted to soil. you can fly them from Florida or Vermont.
@Konstantin – Tyler Mentioned at the bottom: “Private fire fighters benefit the insured and also the non-insured because the extra manpower lets public firefighters divert their attention elsewhere.” So no, they free up public firefighters so that they public fire fighters have more effective manpower.
I surely saw that
It’s second-best in comparison with e.g. those private firefighters being public ones and acting accordingly. In general, wrt economic welfare effect any private + public firefighting force is inferior to pure public force of the same number and quality because of externalities. Deadweight losses, here I come…
When a town in the mountains I once lived in was evacuated, a couple men I knew stayed put, keeping their places hosed down and actively putting out any flames that came their way. It doesn’t take great expertise for one man to keep one house from burning.
Wonder if insurance offers a dis-incentive to do that. Do insured houses burn down more often in wildfires than uninsured?
Depends on wind conditions, I suspect. All the hosing down won’t save you if staying in the area risks smoke inhalation.
Works great if it’s an ordinary brushfire. But it’s incendiary suicide if the fire turns into a “blow-up”; a firestorm that wreaks the same sort of havoc that Dresden and Tokyo experienced in WW II. If those men knew how to forecast the difference, more power to ‘em, but most people have poor ability to correctly judge their own ability to make accurate risk calculations.
Australia has a policy of “Stay and Defend or Leave Early” (SDLE), also more concisely known as “stay or go”: homeowners are encouraged to either do what those two men did, or if they don’t feel up to the challenge they’re told that they should get the heck out of Dodge before the fire hits the fan.
http://www.shelter-in-place.net/
Seemed like a great idea, until 173 people died (most of them defending their homes) in the 2009 “Black Saturday” fire.
http://www.bushfirecrc.com/projects/c6/evaluation-stay-or-go-policy
Actually, here is another argument for cutting the Federal fire fighting budget, if not eliminating it altogether. The wealthy, and those they buy insurance from, can provide fire protection for themselves. They should not be required to pay taxes to support moochers and probably don’t want to. Fires on public lands can be solved by eliminating public lands.
Your comment is snark, but you are right none the less.
I’m not certain if this is the case in Colorado or most US jurisdictions, but the forest fire suppression in BC has been so effective they have changed the ecology of the forests. And they have nurtured a tinderbox situation, where there is so much fuel that any fire quickly becomes dangerous and destructive. Fire in a healthy forest will clear it out, leaving healthy trees, leaving the duff on the ground. With the fuel buildup, the fires burn down to the gravel and kill all the large trees.
They have rapid response teams that jump on lightning strikes and put them out quickly. If the fire gets large, they cannot control it. In 2004 when Kelowna burnt, the fire started in a provincial park some miles from town, got large, then with the wrong combination of winds got into populated areas. A similar situation happened near where I live, the same year, a park area where a fire grew to a dangerous size and was close to a populated valley.
Not to say that everything was peachy before. A response to that has created an explosive condition with no easy way out.
As I write this I can’t help notice the parallels to the financial system.
Aren’t controlled burns the solution.
To the financial system or the forest? Sometimes I wouldn’t mind both.
Metaphorically both, according to Hayek.
Taleb talks about this in the book “Antifragility.”
I suspect they are a tool, not “the solution”. Australia has this problem in spades. It also has controlled burns. And it also has uncontrolled burns. In spades.
This is a great rebuttal to the old joke that nobody showed up at the Libertarian Firefighter Meeting. That little gottcha joke always makes liberals laugh but is counter to the truth that most paid firefighting departments started as volunteer firefighting departments, a voluntary activity still quite robust in rural areas.
Yep. And it’s not just the volunteer firefighters themselves. They get lots of donations from locals.
My town has a volunteer fire dept. My son just signed up for it. It is a great way for young adults to do public service. Plus the excessively firehouse (where all the money saved on labor got wasted) is well known as a hotbed for affairs and liasions.
Volunteer depts. are fine for fighting the occasional fire, but for medical response you need trained paramedics with the proper narcotics, drugs, and skills. Firefighting isn’t hard to do, just labor intensive. Managing complex medical problems requires some brain cells.
I usually think to call for an ambulance when there’s a medical emergency…not the fire department.
“Private fire fighters benefit the insured and also the non-insured because the extra manpower lets public firefighters divert their attention elsewhere”
That’s an optimistic assumption. Has anyone observed public firefighters moving out when the private firefighters arrive? If that doesn’t happen, then the private firefighters benefit the insurers/insured only, without any public benefit.
In fact, if private efforts in firefighting cause a significant reduction in public efforts in firefighting on insured properties, why would any profit-maximizing company pay for private firefighters? So private efforts are in addition to public efforts, not a replacement for them.
I’ve nothing against those who can afford private firefighters using them. But to keep things in perspective, the fraction of homes that have the high-end policies that can afford this is tiny. It’s a niche and I think it’ll stay so.
The fact that some people hire private bodyguards or fly in private planes doesn’t mean that this is the optimal solution for all of us.
Really? Do you have numbers? My life insurance policy isn’t very valuable, but if they know that someone was going to try to kill me in a specific manner tomorrow, I’d think it would be in their interest to hire someone to do something.
What a normal person can’t afford is that level of protection at all times.
Interesting comment, and the topic of quite a few episodes of the classic radio drama, “Yours Truly, Johnny Dollar,” the insurance investigator with the action paked expense account. He was often hired by the insurance companies to pevent a murder, sometimes even suicide.
Is water supply an issue? Are these hired gun firefighters cannibalizing public water to protect their private charges?
How could they be cannibalizing public water? Public water has to be purchased from the utility. That’s like saying parents are cannibalizing toy stores when they buy toys at Christmas.
Cannibalizing was the wrong word, but I think you know what question I’m asking. Maybe water resources are not an issue, I really don’t know.
I’d be surprised if a firetruck has to pay when it hooks up to a hydrant to fight a fire. I have no background in this, but I’d be surprised. Do the private firefighters have access to city or county hydrants?
On the other hand, if these fires are fought with only water that the company trucks in from some location where they pay the H2O bill, fair game.
ok… this post confuses me. leaving aside the supply and coordination issues (they probably are issues, just not that significant)… who thinks private firefighters are problems? what’s the point of the post? it certainly does NOT stand to reason that [therefore] all firefighters should be privatized. nor does it stand to reason, based on the information available, that private firefighters are a net negative. so, ok, let’s keep the status quo.
i have a feeling that alex has some grander point, but it’s unclear to me…
Who thinks they’re problems? The first two posters here, apparently, which suggests it’s not that uncommon
Here’s a hypothetical scenario for such people:
Suppose your house is burning down and *BOTH* the public fire department *AND* the volunteer firefighter force arrive on the scene. Suppose your neighbor’s house is also on fire, and each set of firefighters only has enough resources to put out one of the fires. Finally, suppose your neighbor is on vacation and has instructed you that – were this to ever happen – he would prefer taking your 2nd-choice of firefighters. So, if you choose the public force, your neighbor prefers the private one, and vice-versa.
Therefore, you must choose one of the two forces, and the choice must be made strictly on preference. Which do you choose?
They are private firefighters hired by the insurance company, so you and your neighbor have no choice. There’s a bit of false dilemma here, as well, but I supose the public fighters have to triage accordig to their experience and expertise, But the privates don’t have to ration their services- they are there to prevent/mitigate damage to specific structures.
It’s even worse than that. Every hypothetical situation is, by definition, a false dilemma.
Alas, I suppose no one will play by my rules until I draw a readership as large as Alex’s.
This.
I’ve never heard a criticism ban private firefighters (so long a there are public firefighting services available to everyone), so this post seems placed to invite an attack on private firefighting–to be furiously rebutted! Or it is just preemptively defensive. Public and private services peacefully co-exist in a lot of sectors…
I think Alex just likes pointing out when things exist in the market that are commonly thought to only be sustainable as public goods… Doesn’t need to imply any grander point that it is never a public good, but it’s proof that it doesn’t always have to be, and implying that those who may think so (about firefighters or other things) may have too small of an imagination.
tldr; It’s just fun evidence to give to the “who-will-build-the-roads?” folks.
The case of firefighters is an odd one, because many firefighters are volunteer, and they frequently turn away volunteers. That means that most firefighters are what economists call “garbage” they still have an oversupply of volunteers even at 0 wages.
Fair enough Joshua. Even though I would not want to see the government stop fighting fires or building roads I am entirely untroubled by the idea that insurance companies might also want to participate here.
I think that the point of the post was simply that sometimes the economic interests of companies lead them to do things we might not ordinarily expect but which are quite rational on closer examination.
Ironically, federal fire fighters don’t get health insurance because they are only PT. Colorado rep Diana Degette just introduced a bill to change this.
When I was a kid in rural Georgia people were often known to start forest fires so they could get a job as a fire fighter.
I worked with a guy who did a stretch in prison for arson. He was a quasi-volunteer firefighter (volunteer, but there was a cash incentive for responding to a fire). His colleagues got suspicious after the 2nd or 3rd time he rolled up to the station “just in time” to respond to a fire.
I have a dumb mechanism question about the last line:
“Private fire fighters benefit the insured and also the non-insured because the extra manpower lets public firefighters divert their attention elsewhere. Since there are spillovers, private firefighters are under supplied.”
Does that mean that Alex would support public subsidies for private firefighters? To the extent such subsidies diverts funds from employing more public firefighters, how can their be spillovers unless total fire prevention spending goes up (calculated as private spending + public spending)?
This comment seems to me very circular to me…
“Private fire fighters benefit the insured and also the non-insured because the extra manpower lets public firefighters divert their attention elsewhere. Since there are spillovers, private firefighters are under supplied.”
I’m not sure I buy that argument. The supply of firefighters exceeds the demand even at 0 price (volunteer firefighting groups frequently turn away volunteers).
Private companies supplying fire crews have been a huge part of wildland fires for some time now. States or BLM/Forest Service contract with those companies to provide on demand manpower and services. The change in the article is private insurance companies are now hiring those same private companies.
Wildland firefighting is quite a bit different than structural firefighting which your local fire dept shows up for (although they show up for wildland fires too).
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