The Sietch Blog

Feb 04
Reasonable Behavior

Written by Rt

In our insane world of wanting to have our cake and eat it too here is another example. We continuously want the best of everything with no repercussions – especially to ourselves.

Wikipedia pic

Like other states, California began an intensive review of its flooding risk after the devastation wrought along the Gulf Coast in 2005 by hurricanes Katrina and Rita.

Many of California’s levees were built decades ago by farmers and are riddled with rodent holes and weakened by overgrowth. In most cases, the local water and farming districts that are supposed to maintain them have little if any money to make repairs.

I’m against the artificial and capricious (read that, our) use of mechanisms to satisfy ill-conceived desires (living on land close to coasts in this case). Lest you think I am a Luddite think again – I am not. I love progress, but not all progress is good. In general, concepts (as opposed to ideas) are not good or bad -it is the implementation of such that is the problem. As I am fond of saying, the devil is in the details.

The case above involves living close to the water. It is a river in this example but where I live it is the Gulf of Mexico. Whether it is a flood plain or a barrier island the principle remains the same – you make a bad decision you suffer for it. If you live on a cliff in California and your house is wiped out by a mudslide then too bad. That’s between you and your insurer.

What if, again the example above, you were led to believe that this area was “safe”. This is more difficult. What if that belief was based on a governmental statement. This is much more difficult.

Last month, the Federal Emergency Management Agency withdrew its certification for the levees that are designed to keep the Sacramento River within its banks as it winds past the sprawling neighborhood Melendres calls home.

Let’s examine the the “reasoning” behind such a poor decision to declare this land safe. Again, this applies to many situations and I am using this to talk about the Gulf states. First, the principals knew their actions were risky, to change nature is temporary, and were willing to accept the risk for the initial time frame. The “I love it so I’ll live here” syndrome. Ok, these people were careful to watch for warning signs of danger.

“Levees are spectacularly unreliable partners in flood management,” said Jeffrey Mount, a professor of geology and director of the Center for Watershed Sciences at the University of California, Davis.

This then passes to subsequent owners where there is ignorance (either active or denial) of the situation, or deception. In either case the desire is to blame someone else (perhaps rightfully so) to recoup damages. This is where the government comes in. Perhaps the insurance companies have been selling insurance too cheaply to cover potential costs but it sells more policies that way so they do it.

“The reason I left the Bay area is because of the earthquake insurance. Now I’ve traded it for another problem,” said Melendres, 59.

What’s the gov’t to do? They “can’t” let the insurance industry fail (explain why again), and they have to keep their constituents happy (especially the ones with waterfront property who are often the government themselves).

“We’ve already identified a plan to fix them. What we need now is the money,” said Mark Isaacson, director of the King County Water and Land Resources Agency.

Deja vu again, didn’t this happen with the banking industry? In that case the gov’t set up the FDIC to spread the pain. Maybe it is time for national insurance. It would provide cover for those who are trying to make a quick buck off of insurance, and those making huge bucks off of real estsate.