4 ms·

> Second, governments and private companies should be looking at (socializing) mitigations that will keep risk within tolerable levels The moral hazard is kill

by kibwen 1y ago

> Second, governments and private companies should be looking at (socializing) mitigations that will keep risk within tolerable levels The moral hazard is killer here. I fear that in practice what this means is that the rest of the US will end up bailing out the gormless Floridians who refuse to stop building McMansions on the coast. Insert the gif of Bugs Bunny cutting off Florida and letting it drift off into the Caribbean.

whatwrongwyou 1y ago
This presumes that everyone who builds in coastal areas is "gormless" and deserves hardship. Millions of people live on islands and they don't get a choice where they build. Several Polynesian countries will disappear by the end of the decade. Are they "gormless"?
- FireBeyond 1y ago
  When you’ve rebuilt in the Dane location for a third or fourth time, on the same lot, why should we keep subsidizing the process? At what point do we say “you cannot build here any more”?
  - whatwrongwyou 1y ago
    Even if that location is a fire-prone hillside in Los Angeles? Is the gormlessness of a housing choice correlated with the income of the homeowner?
  - UltraSane 1y ago
    At the very least houses should be required to be MUCH stronger, able to withstand 185 mph winds, which seems to be the highest ever for a Florida hurricane.
hansvm 1y ago
Easy. Don't apply the policy to new homes.
- giantg2 1y ago
  That' funny. In some cases the new homes have newer construction methods that make them more resilient, such as hurricane straps or better fire resistance.
  - bevhill 1y ago
    People in red states can't afford those materials. Half of the houses in the Midwest still use PVC siding and wooden stilts in crawlspace. The first hot day or heavy rain they see and they start melting and molding. But that's all you can do on $30,000 a year from your Walmart job when every other employer in town leaves for the coasts.
    - giantg2 1y ago
      If these were really common issues, the code wouldn't allow them. The melting siding is generally caused window reflections from other houses, especially with high efficiency windows. This happens all over the country.
Spivak 1y ago
You have to be careful when applying moral hazard, because it's just authoritarian behavior with a more polite coating. There are times when it's appropriate and necessary to tell people what they can and can't do but I think this is a case where you either have to write and pass a law forbidding people to build and explicitly define the areas, even if it only forbids new construction, or continue bailing them out like any other natural disaster. This doesn't feel like a situation to "let the market figure it out" or abruptly pull disaster relief after the damage is done.
- kibwen 1y ago
  No, what's authoritarian is an unavoidable insurance scheme that ignores the concept of moral hazard. In fact, I am all for insurance, it's extremely efficient at large and an institution as old as humanity itself, but if you don't deal with moral hazard then the wheels come off the engine. If I'm in an insurance pool with a smoker and they break their leg, that's fine. If I'm in an insurance pool with a smoker and they get lung cancer, they better be paying more than me. Some things are decisions, not fate, and people need to be willing to bear the cost of their decisions. To the point, if that Floridian's house burns down or that Californian's house floods then that's fine; vice versa is the problem.
giantg2 1y ago
And the western US with their fires? Or the southern east coast that also gets hit with hurricanes? How about the increased flooding in the midwest? New construction size has increased across the US too. It's not a single zone.
- toomuchtodo 1y ago
  Red states and the Federal Government don’t believe in climate change. Let them cover their own climate costs. California alone sends $86B to the Federal government. The moral hazard is covering the cost of bad faith actors acting in bad faith. Bootstraps and all that.
  - giantg2 1y ago
    CA can't even get their own house in order. If they were serious, they would apply the wildlands fire code to all the new construction in LA after the recent fires, but they won't. The real moral hazard is thinking the risks, costs, and benefits are as clear cut as you're making them... plus the non-starter about implying not paying taxes.
    - toomuchtodo 1y ago
      They’re the world’s fourth largest economy (behind the US, China, and Germany), they’ll be fine economically. Red states actively choose to ignore climate change, with Texas going so far as to attempting to disadvantage renewables while supporting fossil fuels [1]. Florida’s insurance market is functionality insolvent [2]; they extend and pretend. Why would we financially help folks who don't believe in the active climate crisis? Vote for folks who dismantle FEMA? Vote for folks who rollback the inflation reduction act and climate mitigation spending [3]? Vote for folks who rollback vehicle emissions standards? Enjoy your vote. Better luck next time. [1] https://prospect.org/environment/2025-06-05-texas-legislature-beats-back-assault-on-clean-energy/ https://prospect.org/environment/2025-06-05-texas-legislatur... [2] https://www.bloomberg.com/news/features/2024-04-24/home-insurance-with-lax-oversight-hides-florida-climate-risk https://www.bloomberg.com/news/features/2024-04-24/home-insu... | https://archive.today/g8Ic5 https://archive.today/g8Ic5 [3] https://www.lw.com/en/insights/one-big-beautiful-bill-new-law-disrupts-clean-energy-investment https://www.lw.com/en/insights/one-big-beautiful-bill-new-la...

by kibwen 1y ago

whatwrongwyou 1y ago

This presumes that everyone who builds in coastal areas is "gormless" and deserves hardship. Millions of people live on islands and they don't get a choice where they build. Several Polynesian countries will disappear by the end of the decade. Are they "gormless"?

FireBeyond 1y ago
When you’ve rebuilt in the Dane location for a third or fourth time, on the same lot, why should we keep subsidizing the process? At what point do we say “you cannot build here any more”?
- whatwrongwyou 1y ago
  Even if that location is a fire-prone hillside in Los Angeles? Is the gormlessness of a housing choice correlated with the income of the homeowner?
- UltraSane 1y ago
  At the very least houses should be required to be MUCH stronger, able to withstand 185 mph winds, which seems to be the highest ever for a Florida hurricane.

hansvm 1y ago

Easy. Don't apply the policy to new homes.

giantg2 1y ago
That' funny. In some cases the new homes have newer construction methods that make them more resilient, such as hurricane straps or better fire resistance.
- bevhill 1y ago
  People in red states can't afford those materials. Half of the houses in the Midwest still use PVC siding and wooden stilts in crawlspace. The first hot day or heavy rain they see and they start melting and molding. But that's all you can do on $30,000 a year from your Walmart job when every other employer in town leaves for the coasts.
  - giantg2 1y ago
    If these were really common issues, the code wouldn't allow them. The melting siding is generally caused window reflections from other houses, especially with high efficiency windows. This happens all over the country.

Spivak 1y ago

You have to be careful when applying moral hazard, because it's just authoritarian behavior with a more polite coating. There are times when it's appropriate and necessary to tell people what they can and can't do but I think this is a case where you either have to write and pass a law forbidding people to build and explicitly define the areas, even if it only forbids new construction, or continue bailing them out like any other natural disaster. This doesn't feel like a situation to "let the market figure it out" or abruptly pull disaster relief after the damage is done.

kibwen 1y ago
No, what's authoritarian is an unavoidable insurance scheme that ignores the concept of moral hazard. In fact, I am all for insurance, it's extremely efficient at large and an institution as old as humanity itself, but if you don't deal with moral hazard then the wheels come off the engine. If I'm in an insurance pool with a smoker and they break their leg, that's fine. If I'm in an insurance pool with a smoker and they get lung cancer, they better be paying more than me. Some things are decisions, not fate, and people need to be willing to bear the cost of their decisions. To the point, if that Floridian's house burns down or that Californian's house floods then that's fine; vice versa is the problem.

giantg2 1y ago

And the western US with their fires? Or the southern east coast that also gets hit with hurricanes? How about the increased flooding in the midwest? New construction size has increased across the US too. It's not a single zone.

toomuchtodo 1y ago
Red states and the Federal Government don’t believe in climate change. Let them cover their own climate costs. California alone sends $86B to the Federal government. The moral hazard is covering the cost of bad faith actors acting in bad faith. Bootstraps and all that.
- giantg2 1y ago
  CA can't even get their own house in order. If they were serious, they would apply the wildlands fire code to all the new construction in LA after the recent fires, but they won't. The real moral hazard is thinking the risks, costs, and benefits are as clear cut as you're making them... plus the non-starter about implying not paying taxes.
  - toomuchtodo 1y ago
    They’re the world’s fourth largest economy (behind the US, China, and Germany), they’ll be fine economically. Red states actively choose to ignore climate change, with Texas going so far as to attempting to disadvantage renewables while supporting fossil fuels [1]. Florida’s insurance market is functionality insolvent [2]; they extend and pretend. Why would we financially help folks who don't believe in the active climate crisis? Vote for folks who dismantle FEMA? Vote for folks who rollback the inflation reduction act and climate mitigation spending [3]? Vote for folks who rollback vehicle emissions standards? Enjoy your vote. Better luck next time. [1] https://prospect.org/environment/2025-06-05-texas-legislature-beats-back-assault-on-clean-energy/ https://prospect.org/environment/2025-06-05-texas-legislatur... [2] https://www.bloomberg.com/news/features/2024-04-24/home-insurance-with-lax-oversight-hides-florida-climate-risk https://www.bloomberg.com/news/features/2024-04-24/home-insu... | https://archive.today/g8Ic5 https://archive.today/g8Ic5 [3] https://www.lw.com/en/insights/one-big-beautiful-bill-new-law-disrupts-clean-energy-investment https://www.lw.com/en/insights/one-big-beautiful-bill-new-la...