Unwise
24 August 2006
Editor, The Washington Post
1150 15th St., NW
Washington, DC 20071
Dear Editor:
Russ Wise wants insurance rates in Louisiana to be set by Uncle Sam (Letters, August 24).
Mr. Wise's complaint is not that current rates don't reflect the cost of supplying insurance. Instead, when he writes that "a federal agency could set rates on a more fair and equitable basis, spreading risk among tens of millions of people instead of just a few thousand," he's complaining that residents in places such as Wyoming and Vermont are not forced to subsidize insurance coverage for residents of the hurricane- and flood-prone Gulf Coast.
Contrary to his assertion, however, there's nothing fair or equitable about such forced subsidization. In fact, it would be grossly unfair and inequitable - as well as economically foolish - to force people living in places less prone to flood and wind damage to subsidize people who choose to live on the Gulf Coast.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Editor, The Washington Post
1150 15th St., NW
Washington, DC 20071
Dear Editor:
Russ Wise wants insurance rates in Louisiana to be set by Uncle Sam (Letters, August 24).
Mr. Wise's complaint is not that current rates don't reflect the cost of supplying insurance. Instead, when he writes that "a federal agency could set rates on a more fair and equitable basis, spreading risk among tens of millions of people instead of just a few thousand," he's complaining that residents in places such as Wyoming and Vermont are not forced to subsidize insurance coverage for residents of the hurricane- and flood-prone Gulf Coast.
Contrary to his assertion, however, there's nothing fair or equitable about such forced subsidization. In fact, it would be grossly unfair and inequitable - as well as economically foolish - to force people living in places less prone to flood and wind damage to subsidize people who choose to live on the Gulf Coast.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Posted by Don Boudreaux on
Thursday May 10, 2007 at 9:19pm