Earlier this week a friend sent me a piece he'd culled from an email newsletter he subscribes to. It came from an organization called the Center for American Action Fund (www.americanprogressaction.org). I'd never heard of them, but what he sent to me infuriated me, and not at him and not at the Center for American Action either.
Under the Radar
KATRINA -- NEW ORLEANS LEVEE WORK SLOWS AS COMMERCIAL INSURER PULLS OUT OF CITY: The Army Corps of Engineers for months "frantically" prepared for hurricane season, "patching broken levees and building floodgates." "That repair work is essentially complete and the corps has moved on to the task of strengthening flood protection in New Orleans beyond its pre-Hurricane Katrina level, hoping to entice residents back," the New York Times reports. "But lately the bulldozers have been idle, and the trucks motionless." "To save money, the corps will skip interim steps on some projects and go straight for the higher, 100-year level of protection." The move "will leave the city at risk until 2010 at least." The corps "has also scaled back plans to armor the levees against being scoured away when water flows over the top." Meanwhile, "Louisiana's largest commercial insurance provider" has announced it has plans to "cancel all its commercial property policies in the New Orleans area next year, sparking fears that other insurers will follow and slow the region's economic recovery." "This is sending a shock wave through the business community," said one economic development official. "We cannot exist as a business community without insurance." Another commentator says the announcement could be "disastrous to the recovery of New Orleans."
Naturally, I knew of the insurance pullout and had been following the news stories and the blog posts. But for some reason this particular piece struck the very last nerve I had. I think it was gems like "to save money" and "scaled back" and "scoured away" that really got me.
I had remembered hearing somewhere years ago that the California legislature had passed a law after the Earthquake in 1989 forcing insurers to keep homeowners' policies up and running in the state or lose the lucrative automobile/boat/etc. market. I searched for a couple of hours in vain and then came across a blog by a California attorney with the unlikely name of George Wallace here. He had some really interesting posts about insurance issues in California so I wrote him asking if he knew what the law I thought I remembered was. He very kindly and graciously responded with this:
"I don’t recall specifically, but as best I remember California never reached the point of threatening to cut off insurers entirely if they pulled out of the homeowners’ market. In fact, the long term result of the San Francisco/Loma Prieta earthquake and of the Northridge earthquake was to shift nearly all earthquake coverage to a separate entity, the California Earthquake Authority. Not having to answer directly for most earthquake losses, the private insurance industry has happily pushed along writing homeowners coverage.
I know some states have tried the approach you mention – it seems to me that New Jersey and/or Massachusetts, for instance, clamped down when insurers tried to pull out of the private auto insurance market, and I know there have been regulatory pressures on insurers who have tried to pull out of Florida in recent years (after that state’s string of hurricane losses). There is a lot of debate over whether this sort of approach actually works in creating a marketplace in which consumers can get the insurance they need at prices they are willing to pay.
All of that is a roundabout way of saying that I can’t point you to any specific law of the kind you are asking about. The idea you are talking about, though, is one that other states have tried. Since I don’t practice in those other states, I regret that I can’t give you anything more specific."
There, again, were interesting terms: "California Earthquake Authority," "clamped down," "insurance they need at prices they are willing to pay." What about a Gulf Coast Hurricane Authority? Is it possible? What about an Insurance Commissioner who was willing to "clamp down?" Fascinating ideas. But what really struck me was the "insurance they need" part.
The articles saying that 30% of our current residents are considering leaving in the next year are discouraging, but I don't know anyone I talk to regularly who would fall into that category. Most of the people I know are gutting and rebuilding their pre-Katrina homes or are trying to purchase new ones. And there's the rub. How can you close on a home loan without insurance? The short answer is: You can't. No insurance, no mortgage. No mortgage, no home. No home. . . . . .well it's anyone's guess where it goes from there, unless you're so incredibly rich that it barely matters to you. But that's not the case for most.
I am absolutely no fan of insurance companies, or corporate entities that value bottom lines, CEO salaries and stockholders over regular people including their employees. Mark Folse, at Wet Bank Guide wrote the ultimate piece on insurance companies as criminal monopolies a couple months ago (can't find the link--look through his archives and you'll find some brilliant pieces). I can't do better than that.
Altogether now, with gusto: IT'S THE LEVEES, PEOPLE.
I find myself in the curious position of saying that until or unless the Federal government holds the Army Corps of Engineers accountable and shows the political will to rebuild the levees (please re-visit this post at Ashley's if you're unclear on what I'm talking about), the insurance companies can make a fairly reasonable, if immoral, argument against issuing policies in any of the Gulf States.
So where does that leave us? That is exactly the problem. We don't know.
Sinn Fein, Ashley Morris' battle cry, is a rallying point for more than just the occupants of this house. His Rebuilding piece is a masterwork. Are we, indeed, in this on our own?
Many have talked about shutting down the port. Let all y'all up there in Minnesota (home of Travellers Insurance) have no toilet paper, wrapping paper (Oh Scrooge, ya don't mean it!), no oil, no natural gas, no NOTHING that comes through this port. Until these levees are rebuilt, you can all freeze and use newspaper to wipe your butts. Sounds cold, no pun intended, and you're right. You live in the United States. This stuff is taken for granted--pay your bill, get your heat. Uh uh. Pay your bill, build some levees for the rest of us who allegedly live in the United States with you, and THEN we'll open the port so you can get warm. Hope your axe is sharpened for all that wood you'll be cutting. (Ours down here are kept mostly for hacking through roofs.)
A friend of mine has also coined the term "economic secession." Let's all pay our Federal taxes. Do it early, but withhold them. I know, I know. An idea from some fantasy world (um, remember where we live?) We tell the Feds that we are willing to pay our income taxes provided that every stinking penny of it goes to build the levees, nothing but nothing else. All that money must go into a separate account, not Federal coffers. We'll pay for the damn things out of our own pockets willingly. Tell Blanco not to back down on this, to support us and we'll re-elect her (or not--hey, it's politics---no WAIT--it's LEVEES!)
These ideas sound seditious, eh? Hey you, up in Dubuque, not liking this? Think we're all a bunch of wild eyed radicals? WRONG, although we could be, soon. As Ashley said, in post-WW2 Europe people rebuilt their city themselves, in some cases brick by brick. Okay, is that what it will take? Tell us and we'll do it. Quit dicking around. We'll get the voter registration rolls and put everyone to work in shifts. Most of us would willingly tote wheelbarrows and trowels if it meant that we'd be safe, a term used often and with great effect in the "War on Terror."
The dictionary defines seditious as:
adj 1: arousing to action or rebellion [syn: incendiary, incitive, inflammatory, instigative, rabble-rousing]
2: in opposition to a civil authority or government [syn: insurgent, subversive]
Is that really what it's going to take? We've already found out that FEMA and the Army Corps of Engineers are not here to help us as Americans. (BTW, see da po' blog's post on FEMA's tale of woe. It's a beaut'. We should never have expected them to help, that's not their job. What on earth were we thinking?) If we're on our own, then tell us and we'll behave accordingly. We'll do what we have to do to rebuild this little blip on George Bush's radar.
We have our own terror here, and our terror isn't some religious zealot with a dirty bomb. The terrorists in our neck of the bayou are the ACoE, the insurance companies, and the inanimate levees that may or may not hold. These terrorists are keeping people from rebuilding with any semblance of confidence in their "safety"---a word that's been bandied about in the last six years more disingenuously than Anna Nicole Smith's wedding vows.
People who live with terror every day will eventually take action. Do we have to become insurgents in our own country in order to get this done?
The other night at the documentary premiere, there were two women of about my vintage who said, after seeing the film, "This time it was water. Next time it will be fire."
I truly hope they're wrong.
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