Political Quotes

“reserving the right to object. We can today renew the National Flood Program and reform it. All it takes is for the Senators assembled here not to object to the reforms. I think that flood insurance provided by the taxpayer, subsidized by the taxpayer, shouldn't be for rich people or for their vacation home or their beach homes. Government has no business insuring rich people and their second homes. So I have some proposals to reform this system. We are being asked, though, to extend the flood program without any reforms, without any reforms to protect the taxpayers. Like many Federal programs, the flood insurance is well-intentioned, but it very well may be the best real-life example of a moral hazard. The program covers over 5 million policyholders and provides over $1 trillion in coverage. We are told that the program is funded through insurance premiums. But charging well below the market price of insurance and capping how much these rates can rise inevitably leads to shortfalls. A 2014 report by the Government Accountability Office found that the flood program collected as much as $17 billion fewer in premiums than what the market would have dictated. So when the program inevitably found itself in need of money, in theory, it borrowed that money from the taxpayers, not that the taxpayers had any choice in the matter. They took it. As they often are, they were on the hook regardless of whether they wanted to be or not.…”