In light of the recent Hurricane news in Florida, I thought I'd start a debate on FEMA and the cost of aid. Clearly, FEMA has a useful purpose. Natural disasters happen. It is a type of federal insurance policy backed by tax payer money.

However, looking at this web page -- Top Ten Natural Disasters -- we see that Florida has been involved in 7 of them. Here's the problem. Based on data for the past 15 or so years, we can say with certainty that Florida will continue to be a heavy consumer of those federal funds provided by FEMA. The FEMA money is used to rebuild; the next hurricane destroys what was rebuilt and the cycle continues.

Let's say you're an insurance adjuster. You have a insuree who makes claims well outside of the norm. So, you raise the rates. If this is insufficient, you refuse to insure.

Are heavy consumers of FEMA funds paying their fair share of FEMA insurance? Should there be a FEMA cap per state (or per state revenue)?

Would FEMA money be better spent disallowing people from rebuilding in highly disaster-prone areas?

While you're at it you can tell those who live in blighted and poor neighborhoods that statistically people from those areas tend to use Welfare more often than those in affluent neighborhoods, so if they don't move out of those neighborhoods they will lose their assistance.


Are heavy consumers of FEMA funds paying their fair share of FEMA insurance? Should there be a FEMA cap per state (or per state revenue)?

No.. This would be akin to saying those who use food stamps and medicare be forced to pay higher tax rates because they make use of the funds more so than the average tax payer.

Would FEMA money be better spent disallowing people from rebuilding in highly disaster-prone areas?

If you were to do this for Florida, then you would have to do the same for areas in Tornado alley, and areas along active fault lines and volcanoes.

I don't believe that analogy holds. People get food stamps precisely because they can't get food for themselves. If a US State proves it cannot pay for the disaster itself, then I'm sure the federal government could step in and pay for it. However, like the IMF does for debt-ridden foreign economies, it seems perfectly reasonable to make that state follow certain guidelines in order to ensure that they can pay for such disasters in the future. In other words, the money comes with strings attached.

Also, the issue is not whether or not FEMA should be paid, but whether or not it is being misused due to poor planning. If a person were abusing the food stamp system, then I'm sure you would like to see them removed from participation. Similarly, if poor development planning and location ensures FEMA overuse, then I can't see why caveat emptor wouldn't apply.


Yes, if it can be demonstrated that consistent use of FEMA funds occur in a given geographical area, then why can't FEMA disallow [re-]construction in those areas?

Are heavy consumers of FEMA funds paying their fair share of FEMA insurance? Should there be a FEMA cap per state (or per state revenue)?

As well as providing funds to city or county entities, FEMA evaluates damage to individual-ownned properties. I think that FEMA should limit how many claims an individual can make for the same location. After so many times, you should have learned something, and if it happened again, you're on your own. I believe that FEMA offers low-interest loans to individuals to rebuild, not outright grants (I could be wrong). I know that after the Northridge earthquake, I received a (relatively) small check for immediate needs, but I did not qualify for the FEMA loan because I was unemployed at the time.

I think that FEMA could toughen up their pre-disaster preparedness requirements. Florida goes through this every year, with tremendous and costly damage. You’d think they’d learn something in all these decades. But Florida also seems to be a hotbed for unscrupulous developers, shady inspectors (and politicians who allow it all to happen) allowing rampant and substandard building on swampy land, and having far too many mobile home developments for an area so susceptible to hurricanes. FEMA could demand that Florida do A, B and C before being eligible for any more repair monies. It’ll never happen, but it would be nice.

A good example of this would be the 5/14 interchange in SoCal - it collapsed in the 1971 Sylmar quake, and was rebuilt - supposedly to new quake specs - and it came down in the 1994 Northridge quake. If I remember correctly, the contractor had used an inferior grade concrete to fatten his profit. Rebuilding that freeway was a big part of the cost of Northridge. This kind of cra...stuff needs to be stopped in its tracks. Too often, greedy contractors pull the wool over FEMA's eyes in order to cash in on rebuilding after a disaster.

Would FEMA money be better spent disallowing people from rebuilding in highly disaster-prone areas?

No, though I think the number of claims for the same location should be limited (see above). Should we call NYC a disaster-prone area? 9/11 had to be one of the costliest disasters in history. I’ve said this before, but just about everywhere in this country, you face a certain amount of risk; whether it is from a natural disaster such as fire, flood, earthquake, landslide, avalanche, hurricane, tornado, etc. etc. or “man-made” disasters like 9/11. FEMA exists to help people and cities recover from these disasters.

Are heavy consumers of FEMA funds paying their fair share of FEMA insurance? Should there be a FEMA cap per state (or per state revenue)?

Would FEMA money be better spent disallowing people from rebuilding in highly disaster-prone areas?



This is a really good topic.

I also benefitted from a relatively modest FEMA check following the Northridge earthquake. That money was meant (and used in my case) for immediate emergency expenses. Mine went to pay for a new water heater.

It seems to me though that states might do a better job of planning for natural disasters that happen specific to those regions. California has an earthquake insurance fund that people can buy into and I heard just today that this fund is so full of money right now that there is consideration to reducing the cost for that kind of insurance. Perhaps Florida should look at a similar kind of thing for hurricanes and other states prone to floods, tornadoes and the like should do likewise. FEMA could and should still do the immediate disaster relief, but the heavy-lifting should be handled by the states I think.

Well this strikes oddly close to home (both the hurricane and the debate ).

1.) Well, if we are going to do FEMA by "you consume, you pay more" then what purpose does that serve? The point of federal aid is to help, not to sap people of their money in order to receive a small fraction back when the time comes for it to be applied. So in a logical sense, I think yes we (as the state of Florida, for example) are paying our fair share- the same as everyone else.

1.5.) No. Disasters cannot be foreseen or have a price tag put to them. Fate only knows the amount a certain situation will tap into FEMA (or any other) funds. To cap a state out at a certain amount would be literally a death sentence to those unreached by aid because funds have simply stopped flowing.

2.) I think Sleeper is right. One of my parent's homes was destroyed in Pensacola last year, if they were not permitted to rebuild: A.) illegal, the government cannot interfere in the personal decisions of it's citizens unless they are in danger from external sources (one could argue that a hurricane is a natural source). B.) all places prone to even as much as rain, which can cause flooding, must be torn down and remain uninhabited- a stretch? Darn right it is.

Florida is a peninsula, for gosh sakes we have a target painted across the center of the state. The fact of the matter is not that we are constantly bombarded with hurricanes, this isn't our fault. The hurricanes keep ramming into us, and if the government didn't want the state to be rebuilt after disaster I would recommended going back in time and never buying Florida from Spain... just a suggestion.

Are heavy consumers of FEMA funds paying their fair share of FEMA insurance? Should there be a FEMA cap per state (or per state revenue)?



What about a more Insurance-like approach? People pay into it (subsidized with a portion of the FEMA funding we have now) and when they need it, it is there. Of course, those in higher risk areas would be required to pay a higher amount, but why is this wrong? Why would we want to promote people living in areas that are a greater risk? Why should we subsidize their lives? I realize that sounds harsh, but when you consider the current sad state of the Federal budget, we are going to have to make some hard choices at some point (though there are of course many other areas we can address as well).

I Live in the midwest. Tornados are a risk here. I see no reason why I should not have the choice to pay into a federal assistance program, or waive my access to that assistance.

Would FEMA money be better spent disallowing people from rebuilding in highly disaster-prone areas?



I disagree. What about building codes, zoning, the National electrical code? The government interferes with our "personal decisions" regarding where and how we live everyday. If you look at "personal decisions" in a broader sense, then you can see that the governments restrictions on them are pervasive.

I don't see why we should restrict people in this manner. But I think we could deter future development and expansion simply by developing a program like the idea I mentioned above.



Again, this will sound harsh but, is not the option to move a choice that can be made? When someone chooses to live in a trailer in "Hurricane Alley" should we really continue to replace those trailers day in and day out knowing that it will happen again, and could easily result in a loss of life? (Not suggesting this refers to your parents in anyway).

Again, a program like the one I suggested above would seem fair. Those that choose to live in riskier environments, pay a higher portion of the costs of the program due to that increased risk. I think it is safe to say that there are alot of benefits people receive living in the vast majority of these higher risk areas. Access to the Ocean, better climate, etc. Why should people not be asked to pay a bit more for those benefits to avoid making the rest of us, who do not enjoy the same benefits pay for someone elses enjoyment of them by mitigating their financial risks?

I'm going to largely echo what OS has stated.


It doesn't have to be this way. It could be that an insuree pays funds proportional to the risk. This is how the insurance industry does it. So, if you decide to own in a known high risk area, then you should pay a proportionally higher fee. Of course, there's no reason why you couldn't forgo FEMA aid.


Yet, the risk of disasters can be foreseen. If people didn't own in high risk areas, then the monetary losses from a natural disaster would be lower.


If a person chooses to build in a high risk area, then that's their decision. Why does FEMA need to be invoked for a personal decision? What ever happened to "personal responsibility"?


If you're building in a high risk area (the key here is risk), then you should pay for that risk. Hurricanes seem to scrape parts of Florida clean from time to time. Why should FEMA be used to reconstruct reconstructed buildings from the previous natural disaster? (Note that I'm picking on Florida only because it's frequently in the news for natural disasters; the principle holds for all high risk states though).

Another way of putting this is: the fair market value of insurance has been skewed by FEMA. That is, insurance companies know that FEMA will offset claims made on their policies, thus they can make those policies artificially lower. In a sense, FEMA subsidizes insurance companies.

I think that is an excellent suggestion. Do Floridians and Gulf Coasters get their insurance rates hiked after each hurricane? Or have even the availability of such insurance removed (as happened with the Northridge quake)? Structuring hurricane insurance the same way could ease the enormous financial burden the federal government takes on every year.

From this I assume you have the same empathy for those of us on the shaky left coast? It's not our fault the earth decides to move around once in a while. The big difference is that we can't predict when and where a quake will hit. Weather services have gotten pretty darn good about predicting when and where a hurricane will hit. There are always areas prone to a certain natural disaster. For example, people who live on flood plains cannot get flood insurance. And for a while, all Californians were unable to get quake insurance.

I think Florida (and environs) need to take a real hard look at their building codes (and the enforcement of those codes), and prohibit the building of homes, or mobile homes, that can't withstand at least a mild hurricane.

The problem I see with this debate is that it's too blinkered. By putting one federal program under the microscope, we are ignoring the fact that our taxes pay for a wide range of programs, each of which could be seen to "favor" certain regions. For example, farm subsidies "favor" those states where agriculture is a major industry. Urban renewal programs "favor" those states with the largest cities. Similarly, FEMA "favors" those states that are more prone to natural disaster. So what?

The real problem with tax distribution is that the wealthier states disproportionately support the poorer states. It has nothing to do with individual programs, but with per capita income. Now, it could be argued that many of those programs would be better funded and administrated by the individual states in the first place, but that is not the premise of this discussion.

I have long felt that, apart from funding that goes to national services and infrastructure, federal taxes should be disbursed proportionately - states should get back what they put in. This could either be through federal programs or through direct refunds to the states so that they can take care of their own business. In other words, everyone's tax dollars should support the military, the interstate highway system, etc., but the surplus should either be allotted on the basis of what the citizens of each state pay in income taxes or it should simply be returned to the states (or taxpayers) themselves. As certain politicians depend on this sort of welfare to win the hearts of the heartland, however, a just system of federal funding will never be implemented.

Mississippi, as of 2003, got $1.89 in return for every tax dollar contributed. Alabama got $1.83. While little of that came from FEMA in terms of hurricane, flood, or tornado relief, it could be argued - easily - that they are being overly subsidized by wealthier states in general. The other biggest welfare recipients are Alaska, Hawaii, Kentucky, Montana, New Mexico, North Dakota, Virginia, and West Virginia, each of which gets back more than $1.50 for every dollar they put in - none of them all that disaster-prone. Lesser welfare states include Arkansas, the Carolinas, Idaho, Louisiana, Missouri, Oklahoma, and Tennessee. The biggest losers in terms of subsidizing the poorer members of the Union are New Jersey (which gets fifty-seven cents back for every tax dollar contributed), California, Connecticut, Illinois, Massachusetts, Minnesota, and New York, none of whom get back more than eighty cents. In short, the "northeastern elites" (and the left coast) are making the welfare payments to all those "red states" - and FEMA relief has little to do with it.

Are heavy consumers of FEMA funds paying their fair share of FEMA insurance? Should there be a FEMA cap per state (or per state revenue)?

Yes, they are. No, there shouldn't. As Florida has been singled out, it's worth mentioning that Florida and Oregon are the only states that get one dollar in return for every tax dollar they contribute. They are paying exactly their fair share of federal income tax and every program it supports - FEMA included. California, prone to earthquakes, brush fires, and mudslides, only gets seventy-eight cents back for every tax dollar they contribute - FEMA included. Arguing "fair shares" of FEMA "insurance" is specious.

Would FEMA money be better spent disallowing people from rebuilding in highly disaster-prone areas?

No, it wouldn't. FEMA is not, as characterized, "a type of federal insurance policy". It was not established to address any specific type of disaster (and, as it has been subsumed by the DHS, is now also geared toward relief in the event of terrorist attacks). It was certainly not established to determine where people should or should not live. It was established to provide emergency assistance for those afflicted with tragedy - any tragedy. Even disaster-prone welfare states like Louisiana and Mississippi should not be penalized because of geography. Suggesting that a humanitarian relief program like FEMA should be prejudicial on any grounds is downright perverse.

Well now. Every so often someone says something that makes me think, and even reconsider my position on something.

That is what happened here. Thanks Wertz, now I don't know what I think.

Excellent point. If we are going to consider who is "unfairly" subsidized with funds from tax-payers, we should consider all of the various unfair subsidies out there. Bravo!



I agree, but I would much rather see the money stay in the states to begin with. I see no point in loosing 20-60 cents on the dollar, just for the cost of federal bureaucratic administration of the "refunds". To me, it would be much better if the money never left the states to begin with. At least then, we would only loose 20-60 cents on the dollar to the State bureaucratic administration instead of that, and the additional loss that funds the federal bureaucracy.