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Does that socialize the risk? Only somewhat - after all, the risk is already partially socialized, by our shared values that we're not going to allow a flood-struck community to go without aid. It's hard to let the 'market' work when you're going to step in and provide an emergency backstop on the public dime anyway - it can be more expensive for the government than just coming in from the outset.

Certainly we will help. But what sort of help?** However, I think the subsidized insurance encourages development in places where it shouldn't.

I am all for regulations so that someone buying a property is informed (and signs-off on) the flood plain status. That's a routine part of buying property here in AZ. And I can even see requiring insurance in particularly high-risk areas. Unsubsidized insurance.

**I think people living on the beach shouldn't get any if they didn't buy insurance. I would have more sympathy for a farmer in the midwest. No, I'm not sure how to codify that into a regulation or law. If we're just going to bail out everyone (no pun intended), then why bother with the facade of insurance at all? And what about New Orleans? Relocating those people would have been better "help" than trying to rebuild a doomed city.
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