How Insurance Works

Stossel: Hurricane Reconstruction

This fall’s hurricane devastation is severe. What should the federal government do? This massive rebuilding effort will end up being one of the biggest ever. We will be seeking resources from the Congress, to make sure that disaster relief is available. Politicians from the areas that were hit always say, give us lots of money! We do need and will need federal resources. Texas congresswoman Sheila Jackson Lee wants about $150 billion — just for Texas. So far, Congress has agreed to a portion of that. Of course, only the federal government can send in the military and other first responders. After Irma, 13,000 National Guard soldiers helped rescue and evacuate people. This the kind of emergency response we expect from the federal government. But rebuilding afterward? Why is that the federal government’s responsibility? We’re going to have to restore a lot of
housing. Our infrastructure has to be restored. Yes, but why is that a federal job? Washington has no money of its own. Anything it spends is taken from states and local governments, from people who would probably have been smarter about spending it locally. This idea that it’s always the federal government’s responsibility is new, until recently businesses and charities handled most disaster response. In 1906, the massive San Francisco earthquake and fire that followed destroyed 80 percent of San Francisco. Despite this vast amount of destruction, the city was rebuilt quickly. Population recovered to pre-quake levels within just three years. This happened because rebuilding was done by residents, charities and businesses, not by a bureaucratic government. The disaster even created some opportunities. All San Francisco’s banks were destroyed, But one banking entrepreneur reopened quickly, giving loans to all sorts of people who needed help. His bank grew to be the Bank of America. Seven years later, the Midwest was hit with a huge storm now called the “Great Easter Flood.” Eleven states flooded. Rising water and tornadoes killed 600 people. The federal government’s did very little. But businesses stepped in. The National Cash Register Company built 300 boats to rescue flood victims, and then provided meals and shelter for thousands of people. The role of businesses after disasters is seldom appreciated. Yes, they want profit. But they also want to help neighbors, and they want a good reputation. Giving out water and ice. After the recent hurricanes, big box stores like Home Depot and Wal-Mart were quick to bring in, fresh water, the batteries and food. In Puerto Rico, Coca Cola donated $1 million Pepsi Co, $2 million Elon Musk offers to rebuild Puerto Rico’s electricity grid. Researchers found after Hurricane Katrina business and charities provided much more help than FEMA did. A few years ago, Oklahoma took a big hit. For three days tornadoes tore through the state. FEMA spent lots of money to help rebuild but even NBC’s anchors noticed that private charities did a better job If you’re waiting for the government, you’re going to be in for an awful long wait. The Baptist men, they’re going to get it done tomorrow. The Baptist men got bulldozers and cleared tornado debris from more than a thousand homes. They brought in Bobcats and bulldozers and chainsaws and they just went to work. Within days, the Baptists gave them a new home. It was a mess out here, and they cleaned it up. And they’ve done that for our whole neighborhood. All the sudden we hear hammering and Maddie looks back and she grabs my shoulder and I look up, and they’re already on our roof. You have people driving though handing you meals. People I didn’t know, would just walk up and give us money it’s just overwhelming to me that we were that taken care of. For two hundred years, when disasters hit neighbors took care of neighbors. But now we hear, “a big storm requires big government.” I say, the head of the Baptist charity has it right I don’t think there’s any kind of disaster that can take place that the non-profit and faith-based groups cannot take care of.

Reader Comments

  1. uhhhhh Elon aint gonna build that battery backup electrical grid for song and a blowjob. It's going to be hundreds of millions of dollars if he does it.

  2. Insurance is what fixes unexpected damage. Yes, short term emergency help is what government should offer, but if they didn't offer flood insurance and the like, people wouldn't choose to live in these areas. If you build it, you fix it. It'll be so much better if done this way.

  3. The common good comes from common people. Libertarianism, where your religion isn't enforced by state, but shared trough good deeds.

  4. It’s in the government’s best interest to invest in rebuilding. It’s an investment in producing citizens, not a “hand out”.

  5. As expected, there are a ton of comments from people who don't get the point of the video. You've got evidence of private charities and non-profits literally rebuilding communities stricken with disaster and you still think the feds need to tell them to "fuck off, let us do it"? The federal government's job is only emergency response. Rebuilding is something best left up to the communities.

  6. I have been the person who lost their home. I got nothing from the federal government. This time I was fortunate and Harvey did very little to the part of Houston where I now live. Through HEB stores and my church I have contributed to the local relief efforts. I look back on both and am glad. I wouldn't want it any other way. The greater the federal involvement, the more enslaved we are to the idea that we not only can do nothing for ourselves, but can do nothing for others.

  7. Maybe the culture in Europe has been Americanized, but boy American politics is Europeanizing. Sad to see the US slowly turning into just another socialist democracy, instead of a free Republic.

  8. i totally agree with this point of view,i grew up in new Orleans we had lots of bad hurricanes,Louisianians always managed to rebuild on their own,FEMA is a secret army to get in the way,they want you to live in pac in stacks,not rebuild.its agenda 21.

  9. Normally like this channels opinions but feel this vids a bit ideological. Charities are obviously great to help rebuilding a city and have done great work but you’ve got to be delusional to think there big enough and there’s enough money there to rebuild major cities. At the turn of the 1900 I’m guessing the cost to rebuild would be dramatically less than today because of populations and everything built over 100 years. Nice to get liberal vids because this view is almost extinct in the U.K.

  10. I recall in 2010 when the floods hit we were out in boats while the rain was still coming down getting people off their cars and off roofs. It was just a bunch of country guys in their fishing boats. The day the waters receded about 200 strangers (myself included) made the trek to a neighborhood called Fieldstone Farms and started tearing out drywall and flooring in flooded houses. Churches were everywhere giving food and water, one group was taking clothing and getting it washed and dried and returning it to the owners…it was really amazing.

    About three of four weeks later FEMA showed up at my in-laws house and dropped off a half pallet of water. My in-laws had been unaffected by the flood and tried to explain it to FEMA but their English isn't great so they just ended up with a shit ton of water.

    I look at the Nashville area where everyone jumped in to take care of each other and how fast we rebuilt with no one crying for FEMA to save us and it is as it should be. Conversely I look at New Orleans who seemed to want to rely only on FEMA and 15 years later they are still bitching about no one helping them. Its the sort of observation that has always shaped my opinion on recovery.

  11. Puerto Rico is different. Its an economic basket case (Largely from their own poor choices), 72 Billion in debt, and a creaky infrastructure, with most roads and bridges washed out. There is no choice but for the Federal Government to help. Also, as an island, it has no neighbors who were unaffected, and who could help.

  12. Excellent, excellent, video..the ultra left however demands that government step in because no one but the federal government knows how to rebuild things! It shows the how the left depends on handing out free things so in election season they can stand there and say “look at what we did for you!” I believe politicians should get out of the way and let the not for profit/business/neighborhoods fix the problem!

  13. I recommend a book about post-Katrina New Orleans called "We're Still Here, Ya Bastards!" Basically everything the private sector did worked and EVERYTHING the State did made things worse.

  14. Elon Musk is massively federally subsidized and the amount of relief private help offers is a fraction of the total costs of damages. Sure some companies donated a million or two, but that just scratches the surface of the multibillion price tag. A while ago ReasonTV put up a video celebrating Texas' lack of building codes and is now silent when a hurricane devastated the least zoned areas the worst, while Florida had far less damage due to its protection of natural environments that absorb storm waters and buildings up to code to withstand hurricane force winds. Puerto Rico is also in mass devastation due to their weak codes and what is essentially a colony status. Praise corporations for virtue signalling all you want, but the government is not an alien force that gets in the way; it's taken for granted.

  15. Forcing taxpayers to pay these things is immoral. Americans Are extremely generous and mandating charity is robbing good people of very possibly doing a more effective job with that money or resources. Thanks to crowd-sourcing platforms money can be raised fairly quickly without the government

  16. Mister Stossel confounds short term relief with long-term reconstruction. He uses isolated incidents to falsely imply widespread response. He would prefer us to return to the conditions of over a century ago rather than deal with the realities of today. His seemingly sincere "Why this?" and "Why that?" ring false in the face of logic and modern life within the complex, interconnected web of a modern economy. He sounds, at best, slyly naive.
    Even so, why we continue to rebuild in obvious disaster zones without allowing for a recurrence of those disasters is a question that begs an answer. I'm not saying such places shouldn't be rebuilt, but they should be rebuilt to resistant standards and only such reconstruction should be eligible for future assistance.

  17. I'm from Puerto Rico, and the private sector has done much, much, much more than the public sector for the good of the country.

  18. Wow. Skipping over a very interesting point here aren't you Stossel?

    You mention the 1906 San Francisco fire and the flood of 1913. Anyone wanna guess what's different between now and then? Anyone?

    No federal income tax. The 16th Amendment wasn't ratified until 1913. So yes. If I pay FEDERAL taxes I expect FEDERAL assistance, beyond rescue, during the rebuilding period. Otherwise you really aren't getting anything for your dollar, are you? I will never understand the American citizens penchant for wasting tax dollars and being completely ok with it. I find it weird that ReasonTV/Stossel would skip over this obviously important part. Even I know there was no federal taxes back then, and I'm a Canadian.

  19. Coke donated a million dollars to Puerto Rico? Great! But, the estimated damage in Puerto Rico is as high as 100 billion, a hundred thousand times more than what Coke donated. It's wonderful that businesses and charities are helping, but they're not donating enough to rebuild the states that were hit this year.

    I live in Texas, it's going to cost ~100 billion dollars to rebuild my state. Texas's state budget is ~200 Billion. The damage from Harvey is literally half of my state's annual budget. Despite being the second largest economy in the country, my state can't afford a 100 billion dollar rebuild. Puerto Rico's annual budget is about 10 billion a year. Are they supposed to spend 100% of their state budget on hurricane repair for the next decade?

    The federal government is a bureaucratic mess, but until you can come up with another source to provide the hundreds of billions of dollars needed to fix Florida, Texas, and Puerto Rico, I think it's the best option. Maybe we should have the states pay for it; maybe bankrupting Texas, Florida, and Puerto Rico would help the country. Or maybe this is one instance where your "government should do nothing" narrative has some flaws.

  20. What I don’t get is why everyone was wearing suits while cleaning up the rubble in SF. So glad I didn’t live back then.

  21. BlueNinjakoopa553,

    John Stossel is spot on. The stupid and slum morons always rely on the government to take care of them. We, the American must stop this slum genes running from one generation to the next.

  22. The private sector produces housing, water systems, plumbing, food, and other goods and services…

    Our Federal Government role in our lives is too much….I still want some government services, like search and rescue; but other things not so much.

  23. "Why does the federal government have to pay for rebuilding " AKA why should my tax dollars go to help people who I've never met.

  24. Considering FEMA is big brother, and they used weather modification technology to create and steer these storms, why wouldn't they want full control in the aftermath? Agenda2030?

  25. Call in everyone to help out, volunteers, charities, business, militias, do what ever it takes, give in everything that you have to spare.

  26. The left used this disaster to pressure a lot of the more libertarian Republicans into voting for the debt ceiling raise. 🙁

  27. Its go againts their agenda.. they scare the faith base charity steal their believer into believing God.. they afraid people no longer believe in goverment n thus less power to engineer soviety thru govt..

  28. I live in Ohio and I am sick and tired of paying for people who live in areas that have hurricanes every other year. Move or pay for it yourself.

  29. Why is the government bailing out insurance companies? Do the banks get bailed out as well? Why not give money directly to individuals instead of funneling it through the hands of bureaucrats? Because 911 was an inside job?

    Congress should implement a negative income tax and administer pharmacological freedom instead of forcing everyone to bail out our terrible medical care system. The government can cram their blue pills right up their bolsheviks crack.

    "Poison is in everything, and no thing is without poison. The dosage makes it either a poison or a remedy." — Paracelsus

    "It's a moral problem with a harm which government is doing." — Milton Friedman

  30. But the government creates too much money literally they can create as much as I want and just make it up like it with credit cards

  31. A big storm requires the government to an extent but we don't need scammers coming in and just saying okay now I have to money I do need that but not to that extent

  32. Damn Gummint rules and mindless bureaucrats just don't use common sense to get things done. Just as the injured go through triage after mass casualty events, the same thing needs to occur with natural and/or man-made disasters regarding rules and procedures.

  33. The National Guard is not a “federal” entity, the national guard is a state entity and in Texas it was deployed by the governor not the president.

  34. Yes, business should help. But we as a society have gotten more powerful, wealthy and able to setup funds within the federal government to take care of citizens.
    Some business will not have the resources to rebuild and recuperate from a disaster, and there the federal government, with our money allocated for disaster relief can come in and help rebuild and get the economy running again.

  35. In Mexico the Federal Government is the one that takes the urban planning in hands. It's simply a disaster. Some experts say its practically imposible to work that way. An architect said it was a lot less bureaucracy while he was working for the NY governemnt than when he was working for the CDMX government. It's simply ridiculous how much paperwork you need only to pass the federal, state and city government and build a public space. Now imagine how hard would it be to work with federal government to rebuild homes and buildings.

  36. The government should only intervene when a foreign or domestic enemy is threatening our nation or when infrastructure is damaged beyond repair period

  37. it depends on what sort of country you want to live in, things have moved on since a hundred years ago, government has got it's fingers in far many more pies these days. If you want to go back to pre 1930's where the federal government did little get people in power to push that agenda, but I doubt the grey voters would vote for it.

  38. I live down in Naples and we just through Irma last month. What we needed more than anything wasn't provided by the government. Water, Gas, and power are all things that we needed and all of these were provided by private businesses.

  39. "Businesses and charities provided much more help than FEMA did"; that is a lie Stossel, what a fricken troll he is. What sellout he is to the Koch brothers.

  40. John, I love you, but you’re such a hypocrite. You took FEMA money when your beachfront property was destroyed because you couldn’t find a private insurer to cover you.

  41. I want to build a million dollar oceanfront palace/ forested mountain retreat / sunny earthquake California, for MYSELF! Now who can I force into paying for it?

  42. FEMA you mean the same government organization that forces people into flood ins that really dont need it. with all of the disasters that have been going on nationally, my premiums have steadily risen to now $1,500. i have minimal to no risk, the house is 130 years old and sits on its original stone foundation. we live in a rural town and are considered flood zone "a" meaning they dont do actual studies in rural towns, they simply look at see if you live near a steam or creek. we live near a stream, a stream that is quite a distance from the house, i have lived here since 2009 and even when its at its worse with rain (had allot this year), the water has never even come into the yard, much less anywhere near the home.

    this is a scam, fema is broke and im sick of subsidizing rich people with beach front property. im broke and dont want to feed this corrupt system anymore. the premiums were $800 when i bought this house in 2009 and now is $1,500 WHY???? outrageous. IF i have any risk at all (i dont think so) then its not like whatever risks i had went up 2x. its like having car insurance, never having a wreck or claim and paying double for no reason at all.

    fema is fraud.

    now i just paid someone to come out and do an elevation study on the property and send all of that buisness to fema. the cost, outrageous $700, $350 of which goes right into fema's pocket. hopefully it will be gone soon and i can rid myself of this financial burden. $125 of my mortgage goes to this horrid government waste.

  43. So by the people for the people is a joke now , we already have the best world system so why try to do better ? And that bank of Italy that became bank of America was ran by a honest hard-working intelligent man things that Corporate America no longer is.

  44. The states used to handle rebuilding after disasters, but that was before the income tax and the federal government took all our money away from us. Texas could rebuild themselves if they didn't have to hold up Washington DC.

  45. You know you can say anything in that tone of voice that you say "But REBUILDING? Afterward?" Look imagine me saying "A stupid mustache? On THAT face?" You see? Now this is cheating because this guys face is objectively stupid but it still makes my point. That this man is stupid and annoying has a dumb mustache and uses a stupid tone of voice even a toddler would find patronizing. I think we can all agree in hoping this person doesn't live very long so as few people as possible have to hear his dumb stupid voice and that his family choose to have a closed casket so nobody has to see his stupid face. Also his fair is dumb and annoying too.

  46. My only objection to faith based groups being able to take care of these issues is the fact many faiths are losing influence in today's society.
    Sure, now they have plenty of older donors but when my generation reaches old age they won't. My generation is filled with nothing but atheists and nihilists who aren't apart of any local faith organizations and dontate little of their income to charity. So they expect the government to make up for their lack of real compassion through taxes.

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