With hurricane season underway, lawmakers want to overhaul disaster spending
But the program is fiercely opposed by many environmentalists and conservatives, who believe it could magnify federal spending rather than reduce it. Claims that a national catastrophe fund — as the reinsurance program is often called — would cut disaster aid are just wrong, said Eli Lehrer, president of the R Street Institute and an expert on insurance.
He says disaster aid is predominantly used to rebuild public infrastructure, pay for rescue efforts, and cover the overtime of police and fire personnel — none of which is insured. So the government would be taking on more costs, not fewer, by agreeing to also underwrite insurable losses, Lehrer said.
Another notion is that the program’s cheaper insurance rates — which critics fear would be politically suppressed below the true level of risk — could encourage increased building along the nation’s already fast-growing coastlines. That might increase disaster spending if more people were encouraged to move within reach of ocean storms, opponents of the plan say.
“This is clearly maladaptive with regard to climate change,” Lehrer said. “Sea-level rise, the possibility of more intense storms, all of these things are real considerations. The bigger consideration is the fact that these areas are hurricane-prone regardless. You could reduce carbon emissions to zero tomorrow, and the wisdom of subsidizing people to live near the coast would still be nonexistent.”