More on Houston and flood insurance

But the climate is not changing fast enough to explain the dramatic spikes in disaster costs; all seven of the billion-dollar floods in American history have made landfall in the 21st century, and Harvey will be the eighth. Experts believe the main culprit is the explosive growth of low-lying riverine and coastal development, which has had the double effect of increasing floods (by replacing prairies and other natural sponges that hold water with pavement that deflects water) while moving more property into the path of those floods. An investigation last year by ProPublica and the Texas Tribune found that the Houston area’s impervious surfaces increased by 25 percent from 1996 to 2011, as thousands of new homes were built around its bayous. Houston is renowned for its anything-goes zoning rules, but the feds have also promoted those trends by providing extremely cheap insurance in high-risk areas.

Created in 1968, the national flood program was actually supposed to help prevent risky development. Its complex rules required new construction within designated 100-year floodplains to meet higher floodproofing standards, and “substantially damaged” properties that received claims worth half their value to be relocated or elevated. But most of the program’s 100-year flood maps are woefully obsolete, relocation almost never happens, and Uncle Sam has continued to cut multiple checks for repetitive losses. A recent Pew Foundation study found that the Higher Ground problems have not been solved; about 1 percent of insured properties have sustained repetitive losses, accounting for more than 25 percent of the nation’s flood claims. One $69,000 home in Mississippi flooded 34 times in 32 years, producing $663,000 in payouts. The government routinely dishes out more in claims than it takes in through premiums, and the program has gradually drifted deeper and deeper into debt.

That is from a superb Politico piece by Michael Grunwald.


Houston is the most diverse, rapidly growing major U.S. metropolitan area, and immigration has contributed greatly to its growth and diversity. In 2013 the Houston metro area was home to 6.3 million people, of whom 1.4 million were foreign born—an increase of nearly 60 percent from 2000, which is almost twice the national growth rate. Its immigrant population ranked fifth largest among U.S. metropolitan areas and third in the numbers of Mexican, Vietnamese, and Honduran immigrants. By the time of the 2010 Census, Houston's population did not have a majority racial or ethnic group: non-Hispanic whites represented 40 percent of the total population, Latinos 36 percent, Blacks 17 percent, and Asians 6 percent.

Way to go Sailer. Ruin the thread by introducing race into it and blaming the foreigners for an act of God.

Bonus trivia: Houston has no zoning laws (or very minimal such laws) yet magically the business district tends to be clustered together. Ken Arrow had something to say about this, why you get the same shops clustered together despite them being competitors. You don't seem to find noisy, smelly gas stations at the end of quiet residential cul-de-sacs is another way of putting this, for obvious business reasons unrelated to zoning laws.

Really, Ray, really?

Really. Ray was on target and Sailer should be shamed for that "old man shouts at tv" response to human tragedy.

Please quote where Sailer's post said Harvey was the fault of foreigners.

The line of logic is there. To paraphrase, "It wasn't the building codes, it was the population growth, all these foreigners."

I mean if it wasn't that, what was it? Important trivia on racial composition?

So basically, he didn't say anything of the sort.

Play dumb.

Anonymous is right. And I countered NPW's implicit rebuttal by adding in the OP my "Bonus trivia" about Houston zoning laws (countering trivia with trivia). You see my friends in each of my posts I try and simultaneously write for two different audiences: the 80 IQ crowd like the followers of Steve and the 120+ IQ crowd like me and Anonymous. Baiting the former and dispensing my two cents of wisdom to the latter.

So, immigration (presumably largely illegal) resulted in population growth which contributed to the crisis. True fact? Racist fact?

The thing that is galling for me, personally, is that my extended family is sheltered from rising waters at 104 feet, with a predicted high of 105 feet. (latest update)

And you guys want to talk about minorities.

It's galling that we are talking about the causes of the flooding that is endangering your relatives' lives?

Would you literally rather your own family members die than borders be enforced? I'm just trying to understand your angle here.

I am pretty sure a big hurricane caused the flooding, and that with 50 (to 100?) feet of flood level, we are talking degrees of mitigation.

I think "stop immigration" is a dumb-ass, roundabout, way to handle 50 inches of rain in a major city.

But when "immigration" is your hobby horse, you have to ride, even as people die.

Ray, my IQ is closer to your target market than to Steve's (kidding) but he made a valid point and did not blame anybody for anything. If we have a lot of immigrants - no suggestion as to whether that is good or bad, and I think it's mostly good - we will develop marginal land that would not otherwise be developed and that becomes a problem if there's a flood.

No Larry, that presumes all non floodplain is developed.

That is not the case.

Low land was developed in preference to higher land elsewhere.

That is a planning error. Apply IQ as required.

I read Steve sometimes, but one of his biggest problems is his non sequiturs, and also his lack of just plainly stating what he means. Is he blaming the flooding damage on immigrants? The fact that that house in Mississippi floods and gets a payout on immigrants? He is annoyingly unclear.

The relevance of immigration is pretty obvious in this case if you stop and think about it, but almost nobody does.

"Experts believe the main culprit is the explosive growth of low-lying riverine and coastal development, which has had the double effect of increasing floods (by replacing prairies and other natural sponges that hold water with pavement that deflects water) while moving more property into the path of those floods."

So, immigration is a problem because it causes cities to grow, and when cities grow, they might build on flood plains, leading to catastrophic flood damage later?

I can see why you wouldn't spell that out directly, because it sounds kind of dumb.

Unlike Ray and et al, I am unable to read Mr. Sailer's mind.

I read and re-read his post. He provided facts and stats on metro-Houston population growth and stated that it is largely due to influxes of diverse immigrants.

I do not see where he blamed the catastrophe on diversity or immigration.

In any case, Houston's catastrophe likely is part of the God Almighty's just punishment for America's sins: abortion, blasphemy, Bush, class hate, Clintons, gluttony, fornication, Obama, Pelosi, sodomy, etc.

Maybe God is punishing the Hebrews for the sins of the Egyptians. He knows the Egyptians will not stop anyway.

So God is a Nimby?

The Islamic Society of Greater Houston's 21 mosques are open to all, for shelter. FWIW.

The racial mix seems irrelevant, but immigration is almost certainly the driving force all this construction that made recent storms so much more expensive — yet the Politico piece doesn't mention it at all.

There are costs and benefits to being a nation of 320 million rather than 200 million (which is about where we'd be barring post 65 immigration). Both should be discussed frankly, as should the costs and benefits of being a nation of 400 million or 330 million 30 years hence.

Having just done a cross country drive, I can confirm that the USA is still mostly empty.

It really is the zoning and the seriousness of flood preparation.


Immigrants aren't moving to the wide open spaces. They aren't pioneers. They're mostly moving to big cities and suburbs like Houston.

My sister moved from Orange County, but since she's blond I guess it is ok.

Houston is a pretty great town, except for the traffic, and the floods. I can see why my Vietnamese friends have family there too. My family and their family are alike in that.

And, you can get good Indian food in a lot of small towns these days. Managing motels is an immigration pattern of which I approve.

OK, but so are most other Americans. rather few people are moving to the back of beyond after all. Take away all the immigrants in Houston and you still have millions of people, and lots of construction in flood-prone areas.

What does zoning have to do with anything? Houston has no zoning; it does require building permits.

Would one not use zoning to preserve protective wetlands?

Zoning is traditionally to regulate like uses, such as only single-family residences in this district. Libertarians blame it for making housing unaffordable because it prevents an owner from building more intensely on a lot and is used to protect the neighborhood from normal market forces.

If an owner wants to build on a property, he is going to have to get a construction permit that meets the building code standards, and those are the standards that would be expected to require construction to minimize the dangers of flooding. Houston has those. I don't know these standards are adequate or even relevant to Houston's flooding problems. But when I read that the problem is Houston has no zoning (over and over again), I don't think I'll ever learn.

"Would one not use zoning to preserve protective wetlands?"

No, one would not. That's not how zoning works.

Ok, but zoned "agricultural flood plain" or any other kind of "flood plain" would be a way to mark out a drainage system at once, and not piecemeal.

At least google it, guys.

Floodplains are not products of zoning. FEMA makes flood plain determinations. Houston's building code requires additional construction measures when the property is designated by FEMA to be in a floodplain. That has nothing to do with zoning, the property could be zoned for residential, commercial or industrial use, whether or not it is in a floodplain.

You've looked and found someone using your colloquial use of terms, but it is not an accurate description of the function of zoning.

Are you seriously not going to back down on this? Your links say absolutely nothing about zoning for flooding. Absolutely nothing! A "flood zone" is not an area that has been zoned for flooding, I hope you realize that.

Ag zones and flood plains are certainly connected at the link.

Of course they are, because making flood plains into ag zones is one way to keep them as a flood buffer. Often combined with riparian buffers.

I thought everyone knew this.

And of course it was encouraged by the simpleton now in charge of our nukes.

As Tyler quoted:

"An investigation last year by ProPublica and the Texas Tribune found that the Houston area’s impervious surfaces increased by 25 percent from 1996 to 2011, as thousands of new homes were built around its bayous."

It's the concept of marginal diminishing returns: as Houston's population grows, more dangerous floodplain land is converted to housing.

Moreover, more people means more roads and other surfaces that don't absorb rainfall.

Look Steve bad stuff happens with or without immigration with immigration stuff happens to more people but there are also more people to repair the damage. With more people the division of labor is better. In the city the size of Houston in a year of so some people will have gotten very good at repairing flood damage. People have to live somewhere and they are better off in Houston that where they came from.

Viva Texas, viva Houston where people are allowed to subdivide and build.

You are being selfish and uncharitable. We do not know what the future will be like maybe biotech or something else will drive up average average IQ and allay your fears or maybe your fears are unfounded.

Or maybe immigration comes with costs as well as benefits, and we should be allowed to rationally discuss the trade-offs rather than getting outraged when somebody points out that trade-offs exist.

No, no, clearly it's better to stifle debate on the matter, or even mention, so that half the country feels dispossessed and simmers in resentment, rousing itself long enough to elect the unhinged tycoon because he was the only national figure who dared broach the topic; and the other half declares he's not their president, and his voters are not their countrymen.

And re "with more people the division of labor is better": I don't get why fewer people can't divvy up the labor.

I'm for an open discussion. My opening salvo: Looks to me like more people you have in a country the better division of labor including in non tradable goods and services.

Oh and I do agree that immigration come with costs, that's obvious.

"There are costs and benefits to being a nation of 320 million rather than 200 million (which is about where we’d be barring post 65 immigration). Both should be discussed frankly, as should the costs and benefits of being a nation of 400 million or 330 million 30 years hence."

Right. Discussion of costs and benefits is good.

Instead, everything about immigration gets sacralized and saccharinized in order to shut down debate.

Well, Houston's companies request more than 15K H1-B visas per year.

Are you jealous of intelligent people that contribute to oil and aerospace industries?

Do you believe there are any benefits to immigration? It seems like with most issues debated on the internet, you just get one side talking only costs (you) and one side talking only benefits (open borders libertarians). Really, the point you were making is about growth of urban centers. This is happening worldwide, regardless of immigration. Megacities are the future, everywhere. Let's build them intelligently, regardless of the race of who lives there.

Tyler has frequently documented how immigration improves suburban strip mall restaurants.

I asked if you think there are any benefits, not Tyler.

I'm not disputing Tyler's Restaurant Rationale (as far as it goes).

OK so that's your answer, the restaurant thing is the only benefit of immigration?

But I'm a big fan of marginal thinking. We're well into diminishing marginal returns on cheap chalupas and nail salons.

If that's all you can think of as a benefit to immigration, and an increasing population in this country (the source of this discussion, as the argument was about how crowded cities are getting), then you aren't really discussing the issue in good faith. You are exactly the same as your open borders opponents who see no real downside at all to completely unrestricted immigration.


I read your comment to my husband, who doesn't read the internet: "Good comment. That was a troll? Right on."

Costs: Harris County was on track to preserving much of its prairie at one time, but the houses mostly won. It was an important stop for birds along the Central Flyway.

I thought Houston was an Affordable Family Formation success story?

Although the city of Houston is now highly Democratic, largely due to immigration, the metro area is fairly Republican (relative to other huge metro areas) due to a good wages / home cost ratio.

The problem for Republicans, however, is that without enough border control, the Texan Way attracts huge numbers of immigrants, who tend to vote Democratic for racialist reasons.

So far the GOP has hung on to Texas through intense white solidarity -- e.g., Romney beat Obama in Texas 76-24 among whites according to the Reuter-Ipsos tracking poll. (This isn't well known because the better known exit poll didn't sample in Texas.)

Texas whites have an advantage over whites in other parts of the country in mobilizing because Texas was once an independent country so they can express their solidarity in terms of Texas Pride, which, so far, isn't banned. For example, a successful anti-littering campaign in Texas in the late 20th Century used the slogan of "Don't Mess with Texas."

But look for demands to bulldoze the Alamo, the San Jacinto Battle monument, and the like in the future in order to demonize Texas Pride for the advantage of the Democratic Party.

"But look for demands to bulldoze the Alamo, the San Jacinto Battle monument, and the like in the future in order to demonize Texas Pride for the advantage of the Democratic Party."

I see you are in unhinged mode today.

Another thing you need to consider is that Texas democrats are mostly not wacky Bernie voters like white Democrats in democrat dominated states. They are actually fairly conservative on many issues. The likes of Texas democrats keep the democratic party from going completely socialist.

For example if Houston were full of white Democrats they would probably enact at slow growth policy and push up the cost of a home to un-affordable for Family Formation levels.

I've been around Tyler's neighborhood (Tyson area) a lot this summer and see houses like this:

This model seems pretty good for Houston. Main floor is 8-10 above the ground. Damage is pretty limited if a flood comes. Why don't they build like that in the flood plains? Good for security too, limited access to the house.

Probably the lack of zoning laws in Houston is why they don't build like this. This DC design is for places like Fairfax, Alexandria and Arlington counties in northern Virginia, where the county does not allow you to build as high up as you want, nor put a parking lot in the back without a huge setback, so you have to put a garage under the main floor. Some of our rentals look like this for that reason.

State law requires building one foot above 99% high flood stage.

But that requires actually drawing flood maps that are realistic, which is impossible if you deny climate change and thus all additions to flood zones is rejected as leftist ideology to stop development. Of course, contributing factors to climate change include covering land with asphalt and eliminating wetlands (defined as saturated with water at least once a non-drought year).

If only 15% of Harris County property covered by flood insurance that is mandated if mortgage is GSE insured, that means only 15% of property is mortgaged and in legal flood zone. Estimates are only 30% max of flooded property is covered by flood insurance. What do you bet that the 70% without flood insurance are debt free?

You're starting to see more of this in Florida as flood maps are updated and new construction is required to be X ft off the ground:

Florida Keys has requiried elevated houses (for new construction) for some time and living in one drives down flood insurance rates since the ground floor level is just for storage. A concrete house will help drive down wind mitigation insurance (which can also be quite high).

How many people die tumbling on such steep stairs each year? That risk matters, but gets less attention because they die one at a time.

Considering the number of seniors down here (and the number of chair lifts I see), it's definitely not zero. Agree, they get less attention because they die one at a time. I'd also argue that it is likely viewed as due to "human error" and within one's control, vs a natural disaster.

Actually Atlantic hurricane frequencies are going down if anyting and predcited to go down by 25% by most models, if you bleive them, in the 21st century. Intensity (wind) due to warmer water is projected to go up by 5%, and rainfall up 10%-15%. These are modeled effects over 100 years. So when the question is asked if climate change was repsonsible for any of Houston's problems the answer is NO. The only measured effect that has been seen is a drop in Atlantic landfall hurricane frequency. It is unclear if this is just a small N data sampling issue or a real drop. The rest of the increases are estimated, model forecasts. The models have generally not be very good at forecasting for a wide variety of reasons, mainly becuae it's hard, but also because the modelers back fir the data and tend to bias towards higher warning outcomes (sorry that's true; activist modleers == likely bias).

This is NOAA. If anyting they usually can be counted on overhyping model forecasts of impending doom:

The main point about building up swapland on the Gulf Coast is 100% on point - it's stupid.

Plus one to Sandia. I believe in AGW (man made global warming) but it has weird effects, and one of them might be cooler winters and even arguably a drop in hurricanes. Sandia is right about wrong model 'impending doom', recall W. Buffett made a fortune with GenRe insurance by betting there would be NO big hurricane losses about a decade ago (though I notice he did not renew his bet).

Bonus trivia: I lived through the biggest hurricane (called a typhoon in the Pacific) ever recorded in terms of mm-Hg: typhoon Yolanda in the Philippines, as well as numerous others. Of interest is that most hurricanes (typhoons) are no more violent at their peak than a very violent summer storm in the Washington DC area or east storm. The difference is that the hurricane is like this very violent summer storm for hours on end, and the rain and wind, cumulatively, do damage. It's not like a tornado which knocks stuff down to bare earth. In fact, some of my flimsy chicken coops survived several hurricanes when I tied them down securely. Naturally it all depends on the geometry of the objects and how exposed they are to the elements (if behind a tree or a wall, it helps). Florida readers know what I'm taking about, the rest of you probably don't.

Texas is essentially being hit with a "monsoon", not a "hurricane".

Mulp is right.

The story here is not "hurricane hits city". The story is "extremely high record breaking rainstorm hits city".

The city could use better drainage system and spend more time thinking about ways to protect its coastal wetlands as a buffer against storm surges but ultimately no city can handle 50 inches of rain in 5 days without serious flooding issues.

OK, that makes sense,

The initial metric used above for this hand-wringing is: "dramatic spikes in disaster costs" .
But US Dollar$ are a rubber-ruler if comparing historical disaster "costs" -- billion$ now were only million$ decades ago.

Also, "deaths" may be a better metric in comparative disaster costs. Hurricanes have always hit and death tolls were staggering 3-6 generations ago. There are horrific accounts along the Texas coast of mass corpses (post hurricane) being loaded on barges and dumped at sea -- only to be washed back up on shore again a few days later.

The hurricane threat could be handled much better, but people suffered much more in the old days.

The Galveston hurricane of 1900 was the deadliest natural disaster in US history.

Hurricanes/typhoons, even mere Category 1s, can still kill hundreds or even over a thousand people in less developed countries.

Wasn't it topped (damage wise) by the 1938 Long Island/New England hurricane that hardly anyone even saw coming?

Not in terms of deaths, no.

3-6 generations ago we did not have a warning system in place for hurricanes.

...well, yes -- but the original question was the relative "costs" of today's hurricanes to previous ones.

Hurricane Harvey ain't that bad. 12,000 dead in 1900 Galveston seems much more "costly".

( about 500,000 dead in the 1970 India/Pakistan hurricane/typhoon ?)

It's estimated that less than 25% of homeowners in Houston have flood insurance. And since the damage is mostly from flooding, homeowners won't be able to recover under their casualty policies. In other words, most of the losses in Houston will be suffered by the homeowners themselves. Except to the extent the federal government provides relief to them, a high probability given that Houston is very much in Trump territory. Indeed, the state's two U.S. Senators, who opposed relief from the damage done by Sandy, are all in on relief from damage done by Harvey. Not to ignore the losses from recurring floods of the same properties, but the biggest problem with Houston is sprawl, which has resulted in impervious surfaces covering much of the area (preventing the flood water from percolating into the soil). As for recurring damage to the same properties, places that have building codes that require properties to be brought to current code (including all living areas being above the flood plain) if the property suffers substantial damage (often defined as more than 50%) would greatly reduce that problem. Of course, Texas is notorious for the absence of government rules.

two U.S. Senators, who opposed relief from the damage done by Sandy,

Who opposed including a lot of non-Sandy relief in the Sandy relief bill. (Also, Houston proper is not Trump country, and, like in most places, the people who live in the most flooding vulnerable areas tend to be poorer and vulnerable for other reasons.)

That low-lying=poor equation doesn't hold in hill-less Houston, which is (was) prairie bisected by ribbons of forest along bayous. The bayous are pretty and the affluent tend to live along them, particularly Buffalo Bayou.

Incidentally, the University of Texas recently purged a campus statue of Ima Hogg's father, Governor James Hogg. Not because it offended the sight, but because it happened to be paired with Albert Sidney Johnston, who had to go. Guilt by symmetry.

One of the few harmless places for floodwater to go in Houston is bayou-side Memorial Park, a gift of the philanthropic, childless Hoggs.

They opposed the bill because 20% of the money was going for relief, and the rest was Obama pork.

Money to pay for NOAA being able to forecast storms like Harvey is Obama pork?

Or, was it the money to pay for disaster relief for Texas wildfires?

I'm guessing the pork is related to the Republican Frelinghuysen amendment to the appropriations bill...

Like the impervious ground in Houston covered with cement, the brains of many commenters at this blog are impervious to facts.

Pretty terrible to mention the "anything-goes zoning rules" as part of the problem, instead of lauding them as being responsible for the recent densification of downtown Houston, resulting in redevelopment of single family homes into lots of three and four story townhomes with the first level all garage. That lack of zoning has made a lot of homes less vulnerable to flooding. Take a look at neighborhoods like Rice Military.

I suppose one problem is that other cities in the country having tighter zoning that Houston encouraged their people to move to Houston. In general, though, if you think that the problem with Houston is too much sprawl, note that, like most other cities, the sprawl is outside city limits. The alternative of a zoned Houston is more sprawl outside city limits, and less density and vertical buildings that better resist flooding.

It seems a pretty clear flip side of easy building to me. And you know the flood maps were not exactly featured in the New model homes.

For anyone interested in California water issues, a good Twitter to follow: @UCDavisWater

There certainly needs to be something that disincentivizes building in flood plains. Zoning rules could do that. However, if flood insurance were not heavily subsidized by the federal government, this may be solved by market forces without needing the zoning rules.

Presuming rational agents, sure.

But do we presume rational agents in home real estate?

What world do you live in? I'm not in a flood prone area, but flood plains are ALWAYS part of the home-buying process. You always know if you're in a flood plain because if you are, you have to have the insurance. I have bought a number of houses and never without seeing the flood plain map.

I live in a system with current laws in place. You do too, which is why you see many of the requirements you do.

So you support a change in the law to eliminate federal flood insurance and replace it with mandatory disclosure of flood plains as part of real estate closings? I'm sold.

You should have asked that earlier. Sure I support, if not ending, severely limiting federal flood insurance. Move it back to the 500 year line, and pair it with zoning to hold that line.

No building is done in flood plains in Texas. Only leftists see wetland and flood plain on completely dry land.

Flooding is caused by God being so angry about the Texas bathroom bill being repeatedly introduced that he broke is promise to never use flood again to punish.

I would say the causality is that the sprawl produced the density within the Loop. Most of the sprawl is ugly, particularly to people from other states. It can make for long commutes. It is a status thing to live within or close to the Loop and feel one is part of a real, vibrant city, but deed restrictions are not much less important than ever. Urbanists and townhouse builders are not to my knowledge pioneering into areas like Gulfton, say, though it is well within Beltway 8, a long-ago "edge" of Houston.

The severing of the connection between house and zoned school (for people willing to put the effort in), and the flight to private schools, have also aided in the gentrification of certain once-unfashionable close-in neighborhoods.

The school bus doesn't even come to my parents' neighborhood.

Why exactly are people flooding into these flood plains? Could it be that real estate in more desirable, safer places is too expensive due to severe land use restrictions?

My sister lived in a lower area. Recently moved to an older (higher?) area ..

"K took 3 hours to drive to her house......from her mom's house. Maybe the rest of the family from there too ? That levee might flood/overflow. The levee/river limit is 104......Her house sits at 105. Crest won't happen until Weds."

Whatever that means. We hope and pray for the best.

At the old house the street side gutters were 3ft ditches, just to handle normal rains. A moderate storm would flood the back yard but not the house. Put gaters on the street.

I guess the attitude of the neighborhood was rueful, that builders had barely planned, but hopefully we'll enough. I'm sure that old house is underwater now.

So, to answer your question more clearly, they were big cheap houses and people trusted the builder.

I think it is unlikely these uninsured are cash buyers. Are these federal loans as well? Who wrote the paper?

The rebuilding payouts should be structured to strongly incentivize people moving.

"relocation almost never happens" on the coast. Relocation has frequently been used along flooded riverways in the Upper Mississippi Valley. I think the only coastal relocation was an Indian tribe that was recently relocated from the Louisiana coastline.

"Consistent with the historical mission of the Federal Reserve, the third component of our policy response has been to use all our available tools to promote financial stability, which is essential for healthy economic growth. At times, this has required working to preserve the stability of systemically critical financial institutions, so as to avoid further costly disruptions to both the financial system and the broader economy during this extraordinary period.

As indications of economic weakness proliferated, the Committee continued to respond, reducing the target rate by an additional 225 basis points by the spring of this year. By way of historical comparison, this policy response stands out as exceptionally rapid and proactive. In taking these actions, we aimed not only to cushion the direct effects of the financial turbulence on the economy, but also to reduce the risk of a so-called adverse feedback loop in which economic weakness exacerbates financial stress, which, in turn, leads to further economic damage.

To ensure that adequate liquidity is available, consistent with the central bank's traditional role as the liquidity provider of last resort, the Federal Reserve has taken a number of extraordinary steps. For instance, to provide banks and other depositories easier access to liquidity, we narrowed the spread of the primary credit rate (the rate at which banks borrow from the Fed's discount window) over the target federal funds rate from 100 basis points to 25 basis points; extended the term for which banks can borrow from the discount window to up to 90 days;"
given in Austen Texas.

The fact that houses were built in flood plains is no reason not to come up with extraordinary measures to prevent this storm from affecting the broader economy. Any measure necessary to prevent a cascade of events that would harm other people is justified.

Flood insurance premiums should be high enough to not only cover the value of the house but should payout for the damage that homes do to the environment when fuel, paint and household stuff ends up in the water beyond the properties edge.

It is OK to subsidize the poor but IMO you cannot subsidize the middle class and so should never try.

The predictable flooding in Texas is turning middle class households into poor households because very few of the flooded homes are covered by flood insurance, so the middle class owners will become very asset poor if they don't default and declare bankruptcy ending up poor. The FEMA grants of cash and subsidized loans will not prevent them from becoming poor.

Redistribution of wealth from people with money to many of these newly poor by paying them to work will lift them out of poverty within five years.

However, conservatives believe paying people to work costs too much. That why they love Uber where pay for driving is zero for more than half the Uber capitalists working as a free driver while renting their car. And love the idea of welfare paying most of the living costs of tens of millions of workers, and want to increase EITC to cut labor costs.

Well looks like Trump got his infraastructure plan......

Has the Freedom Caucus committed to funding welfare for middle class Texans without offsets of cutting welfare for the disabled and working poor?

Well looks like Trump got his infrastructure plan......

Doesn't seem like much of a topic for discussion. The answer is obvious. Government organization and its employees think they can anticipate all permutations of life events and human cunning and, of course, they cannot. No one can. Then there is a big stink, more regulations to fix previous errant legislating, thereby creating more loopholes and more opportunities for discrimination and waste of everybody's money. All of this, and the responsible govt. workers get a pension and spend their retirement talking about how hard their jobs were and that it was always other govt. agencies that wasted money and resources. Self delusion is the most common human trait.

If you don't have government to prepare flood maps, who do you think will?

In the absence of government involvement, home insurance companies would do it, since they would need the information to know what to charge people.

They could hardly do a worse job than government. Tyler's first link above has a map showing 100 year flood zones and all the recent flooding that has happened outside of those zones.

Of course, arguing the government should get out of flood planning/management completely is pretty radical. But one could argue that the government should still have that role, but get out of the business of heavily subsidizing building in floodplains.

Why would insurers create flood maps when they don't provide flood insurance?

You are arguing insurers eagerly write health insurance policies for people with known medical costs, or would if there was no Medicare and Medicaid.

If you price a policy at a high enough price to cover risk plus profit, only those who know their risk is higher than the price of the insurance will buy.

To argue mortgage originators will ensure the properties are not in flood zones because they would not want to put other people with money at risk of debt default for a hefty fee, and would rather protect other people they don't know by working for no pay, is rather absurd.

Why would money market funds who buy uninsured debt fund construction of flood zone maps? They didn't fund verification of income and assets and true market value property assessments from 2001 to 2006 when the State government regulation authority was eliminated by first Congress and then the Bush administration suing to block States from regulating mortgage originations under the December 2000 law.

The FIRE sector deals with uncertainty by abandoning the market, or relying increasingly on government bailouts, as in, the Federal courts giving them all the assets first of a failed debtor, as well as doing everything possible to get paid by the Federal government for the losses that were very predictable.

I'm sure the mortgage companies and maybe even the homeowners might think about it. Let's see, I'm thinking of building a house in southern Louisiana, or in the Houston area. Average elevation in the Houston metropolitan area ranges from 3-4 feet in Kemah and La Margue to about 40-50 feet in Jersey Village and Humble. If I have lived in Houston more than a few weeks, I know that if it rains for 30 minutes, the water will be over the curbs in the streets and the tallest non man made structures are fire ant mounds. Maybe I should not build close to a bayou. I always wonder how the first people who moved into the area, and all of the people for the last 250-150 years managed to figure this out without government interference. I also find it interesting that most people who offer their opinion of how things should be run, always take the route that makes them sound smarter and more capable of wise decisions than others..

I think these two answers work better in theory than practice. In securitized lending how many originators really care? The paper is being stuffed into some teachers'' retirement fund.

That's not my problem. Teachers shouldn't have a retirement fund. Everyone should be responsible for their own future. It isn't my responsibility to make sure a loan originator does their job correctly so they, or someone who trusts them won't lose money.

Excellent. "F 'em" is an answer that tells us who you are.

So, teachers should never save for retirement and work until they die, meaning the day they die they put a bullet in their brain?

TIAA was started 99 years ago to provide provide private sector retirement savings investment to teachers and currently manages almost a trillion dollars in teachers and related worker assets.

And the justification for privatizing Social Security was the performance of such funds in the 90s, including the public employee funds that were providing retirement annuities based on insurance regulations specifically created to ensure pension funds had sufficient assets.

A pension is simply an annuity.

Are you arguing annuities should be illegal?

Mutual funds should be illegal?

And your basis for this opinion is what? Sophisticated financial entities don't care about their investments?

Quite recent history.

Read The Big Short, or just watch the movie.

And in your mind no one learned anything from that experience? Nothing has changed? That was, by the way, not a case where people did not care about their investments or did not lose money. Tons of businesses lost a ton of money, and certainly not just pensioners. It's absolutely false that these players did not have their own money on the line.

Who needs flood maps? If the government flood insurance is limited to one payout per property parcel, home buyers and private insurers will get the message.

So, was it unpredictable? hahahahaha

Thanks dan1111 for calling me a radical. It seems much preferable to being called a brown nose, company man, govt. stooge. bureaucratic cog. In fact, it puts me in pretty good company; Nelson, Hamilton, Martin Luther, Alexander, Cicero. Wright, and so on.

A guy I used to work with built a $300k house (back about 30 yrs when in NE Ohio, that was pretty nice). He fought with the zoning/building commissions for months because he was building on a flood plain. He insisted that the berm he would build, along with the drainage would be good enough. Finally, they gave him an exemption - there was this little trickle of water running across the back edge of his property, don't ya know. Built house in the Summer, moved in that Fall. One day in the Spring, he called in. He wouldn't be at work, was busy sand bagging his property, the spring flood waters were within inches of his foundation. People are stupid, and expect everyone else to pay for their stupidity. ... I suppose the "I know better" syndrome is what motivates most of us peanut gallery commentators as well. Go figure.

Trigger warning: anecdotal evidence ahead. None of the numerous new subdivisions in my part of Houston have flooded. All such new developments are required to have a series of often linked retention ponds in and around them. Similarly the new Grand Parkway has very deep and wide ditches that run alongside it. The ditches currently look like big creeks but the road (at least around here) is open. The neighborhoods and roads near me that have flooded are older and have no pre-built flooding abatement.

So I don't think it's the current growth that's to blame. A likelier suspect is that in the past people thought there wasn't much you could do when building on flat ground where it floods a lot other than cut some channels to drain flood waters away into the Gulf quicker than usual. The idea of sequestering it until it seeps into the ground or evaporates appears to be an improvement on older methods.

It would be interesting to see someone take a more systematic look at this.

Even better if they would put native mid and tall grasses in the ditches instead of bermuda. They are designed to hold water in the soil.

Trees are the water storage where it rains seldom, or seasonally.

The NFIP bought coverage from private resinsurers to cover for 26% of loses greater than 4 billion up in a single event.

So, the NFIP is not 100% public, some risk is hedged with private investor money.

When would it ever make economic sense for the US Government to buy insurance?

Yeah, that starts to confuse the point about who's too big to fail.

This is not about liquidity or solvency, it's about pricing risk.

It seems private investors estimated the US federal government (some bureaucrat) was too scared. Thus, they could profit from the scared getting coverage for some catastrophe that would never happen.

Shorter: the government assess risks better than private least this time.

But more importantly, for floods, more than 70% of property losses are uninsured, and economic losses aka opportunity losses, and 99% uninsured.

How NFIP causes building in flood prone areas when it does not cover that much of the losses, and to qualify for NFIP you must pay workers so much more, that the excessive labor costs to meet the job killing regulations, kills jobs.

Under the American regime, greed is good. Selling homes to people who will drown is awesome.

I m sure in Brazil there are no floods.

Brazil is of the countries with keast hurricanes in the world. Also, people do not make money by building/selling homes that will drown.

Plenty of flooding, though
"Flooding in Brazil leaves tens of thousands homeless, at least seven dead"

When it rains, it pours, but it is not like America, where people are attract to build their homes at flooding places so some people can profit from their disgrace.

Looking at costs of floods over time without correcting for inflation is meaningless. The CPI corrected cost for previous floods show many over a billion dollars. Also the increas in the population as well as teincrese in urbanization would make billion dollar events more likely.

This is thoughtcrime. The Party line is that recent flood losses are due to global warming. Kevin Drum says it today. Fivethirtyeight ran an analysis along the same lines as Grunwald and Cowen, and Nate Silver was forced to publicly apologize and recant. Tyler had better hope that he avoids the same fate (or, worse yet, a criminal trial under President Elizabeth Warren).

538 link?

Here is Silver's public apology and ritual self-abasement. A little googling will reveal the internet lynch mob that forced him to recant his participation in thoughtcrime.

That link is from Mar. 28, 2014, by the way.

And includes in 538's defense of the author under fire the following passage - 'Let me deal with category No. 4 first. Roger and his critics can kick up a lot of dust everywhere they go. Some of the criticisms of Roger have been unfair. For instance, Roger is not a climate “skeptic” or “denier.” He has written at FiveThirtyEight — and he has testified before Congress — that he believes in the thesis of anthropogenic global warming (AGW), that he considers it a serious problem, and that he thinks society should make efforts to mitigate it.'

You are saying that the climate change fanatics have become more tolerant and open-minded since 2014? Or just that the past is generally irrelevant?

Right, the rain of four feet plus is not due to global warming increasing water temperatures, because the Gulf of Mexico is much cooler than normal due to the global cooling since 2000....

The GOM water temperatures off Texas are actually below average thanks to the cooling effect of Harvey which has used evaporation to cool the Gulf waters.

Thus heavy precipitation is a sign of ocean waters being cooler than normal. And to a conservative, that means heavy rain and snow means global cooling is happening, not warming.

"The record for total rainfall from a tropical system has been broken with 49.20 inches of rain south of Houston, NWS says" [today]

Please tell me how any city with rivers and near the ocean can avoid flooding with that much concentrated rain.

I live in a Houston suburb. My house has never flooded, but here's some of our nearby creek's history.
1994 - a 500-year flood.
2001 - a 50-year flood.
2016 - a 50-year flood followed 6 weeks later by a 100-year flood
2017 - only a 100-year flood. It missed the 500-year mark by less than 2 inches despite having 29.4 inches of rainfall in 4.5 days.

That's two 50-year floods, two 100-year floods and one 500-year flood in 23 years. Something tells me that we won't have to wait 500 years for the next 500-year flood.

If the government's official flood frequency levels are obviously wrong, then keeping people from building in the flood plain won't be sufficient.

Yes, it seems remarkably stupid for the government to have official flood plain maps that are apparently totally wrong and trick people into building in flood plains because they are told they are not flood plains. It's hard to imagine how private entities could do any worse.

Well, if you believe man can not change the environment, then flood zone maps drawn circa 1980 are totally accurate today.

Leftist Obama and leftist Democrats elected in Houston have changed flood zone maps simply to get rich, but most of the Texas maps reflect history before 1980 which is the only accurate basis for predicting flooding in Texas because man can not change the environment.

I imagine the change in damage caused (dollar-wise) changes exponentially relative to change in a weather variable. 49 inches of rain causes more than 10 times the loss of a 5 inch rain.

This study supports an earlier IPCC finding that says there's no link between flooding and climate change. .

Comments for this post are closed