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Source link: http://archive.mises.org/5176/is-the-market-the-cause-of-hurricane-damage/

Is the Market the Cause of Hurricane Damage?

June 12, 2006 by

An interesting challenge to the idea that markets can produce safety and quality comes from a report from the federal buildings inspection team. The National Institute of Standards and Technology, part of the Commerce Department, looked at homes that were damaged in Katrina and Rita last year. They found that many of them were not built to the highest standard of construction. Not surprisingly, they complain about unlicensed roofers and unregulated building, and demand a full-scale crackdown. We can take it for granted that the people who wrote the report believe that the free market failed. FULL ARTICLE


Brad Dexter June 12, 2006 at 11:07 am

Whatever failures the market has is no reason for more bureaucrats. That, of course, is the great divide, those who think the market is bulletproof, and those who think everything needs to be regulated. Since both populations come from fallible people, neither is going to be perfect. I just happen to believe that bureaucracies are worse in that they are much more inflexible than the market. The market my have some failures, but a bureacracy creates a false security while performing more poorly. Two outcomes from regulation, the same amount of houses blow away in the wind with the extra bureaucratic cost, or houses are built like bunkers costing three times as much, and new housing starts falls by 3/4ths, with extra bureaucratic costs.

Anarchist in the Military June 12, 2006 at 12:05 pm

Katrina exposed a more serious market failure to my family down home. In the days after the storm, my sister emailed me, informing me that she couldn’t get Nutella anywhere! Such disruption of chocolate breakfast spread highlights the need for swift government intervention! Just think, it could have been crunchy JIF!

Roger M June 12, 2006 at 12:16 pm

Very good article! The left loves to point out perceived market failures while ignoring the failures of socialism around the world.

Here’s another government failure exposed by the hurricane’s: The Feds have bailed out everyone in every hurricane with so much money that many people don’t build hurrican-resistant houses because they know the Feds will pay them for the destruction more than the house was worth.

Then there’s the Federal home insurance that encourages people to build right on the coast where their houses will suffer the greatest damage!

Yancey Ward June 12, 2006 at 1:02 pm

This past weekend there was a story in the newspapers about a small dog, in New York City, that was roasted to death by an unattended blow dryer in a pet grooming shop. Not surprisingly, and depressingly, there is now a call for licensing and regulating pet groomers.

However, I must admit that I am surprised that the state of New York, of all places, doesn’t already do this.

Anarchist in the Military June 12, 2006 at 1:29 pm

Roger, I think you missed the point. People like my friends and cousins who live in N.O. and Metairie didn’t intentionally invest in shabby housing because they counted on a gov. bailout. It has been decades since we have had a direct hit. A massive flood hasn’t occured there since the 1920s. People don’t think about thesethings. sure, a little damage here and there…may have to stay with friends in Hammond, or B.R. whatever. But nobody ever thinks about the levees breaking. The problem with South Louisiana has been that we’ve been getting the shaft ever since our homeland was unconstitutionally purchased by Jefferson. Oh and Madison’s conquest of the Republic of West Florida (my home and not even part of the purchase) is totally overlooked by the Constituion worshipers. Just leave us alone, and let us fix it ourselves. Washington has done nothing but screw us.

Manuel Lora June 12, 2006 at 1:42 pm

A massive flood hasn’t occured there since the 1920s. People don’t think about thesethings. sure, a little damage here and there…may have to stay with friends in Hammond, or B.R. whatever. But nobody ever thinks about the levees breaking.

Right. I lived in New Orleans for about 6 years and married my wife there (a native). No one ever thought that the whole thing would flood. That said, however, Anarchist in the Military is right: it had been so long since the last major one that people didn’t really care. But then again, everyone KNEW that it could happen. Year after year, the media (mainstream even did a good job covering this issue) would always talk about what could happen if the city flooded and the predictions were accurate. Back in the late 90s when I was in charge of a cable channel late night playback, they would air a computer simulation of what certain parts of the city would look like. 10 years later, reality looked just like the predictions.

Thus, as Mr. Rockwell says, people decided (for a variety of reasons) that it was simply not worth it to, at the time, build forts and bunkers but rather normal houses.

M E Hoffer June 12, 2006 at 1:59 pm

Y’all talk of Forts & Bunkers as if they would mirror the baronial castles of yore.

try: http://www.forms.org/ for starters.

Also, cellular concrete slabs, utilized w/in a “post & beam” architecture, work quite well.

Both, ICF & the above, are less expensive, more durable, insect & fire resistant, and properly designed–virtually wind-proof.

Point? There are other building technologies than “stick-framing”( aka “Normal” housing ).

Wonders, they will never cease..

Curt Howland June 12, 2006 at 2:25 pm

M.E., “Y’all talk of Forts & Bunkers as if they would mirror the baronial castles of yore.”

Heck yeah! But then, if I had a choice right now (and a large enough lot) I’d likely go for the “open center” Roman style. Sunshine and privacy at the same time.

Have you ever been to the Cloisters, in NYC? Glorious. A perfect example of what would be possible if I had “all the money I could spend”.

David K. Meller June 12, 2006 at 3:10 pm

I think that a report about storm damage, coming from the government as it does, with its recommendations only favoring the said government, it’s power, it’s pork, it’s incompetence, and its all round irresponsibility, shows a lot of sheer gall to taxpayers and citizens, all of us were always so badly served by government on these and related issues in the past!

On countless previous occasions, the government, with its reports, and its “blue ribbon nonpartisan commissions”, and their recommended laws, with their “inspections”, their so-called “reforms”, their regulations, endless prosecutions and appeals, along with the inevitable bribes and kickbacks, union privileges, politically-based (and BIASED) blatantly unfair and uneven enforcement, and other scandal; along with the government’s preposterously uneconomic and extravagant tax-financed insurance subsidies to businesses and homeowners in flood-prone and storm-prone areas, mandated by the legislature, shows more nerve than brains on the part of the authorities issuing such a “report” to the rest of us.

This is a blatant insult! Unfortunately, we may have to vote for these politicians, deprived of anyone better, the way we are, but we are not all that STUPID!! We know from hard and bad expericence how worthless government action is!

The ONLY report which could be of interest to any American with an IQ over his shoe size would be a report freeing the construction, insurance, tourism, and housing industries, and the engineering profession, from the heavy hand of the State.

Even arch-statist Abe Lincoln said–”You can fool some of the people all of the time, all of the people some of the time, but you CAN’T fool all of the people all of the time.” Truer words were never spoken.

President Bush and his neocon/ New World Order owners and handlers are finding this out with their horrid wars in Iraq and Afghanistan. His counterparts (both Democrat and Republican) will find this out through this response to their cockamamie “report” on the issues of Storm damage and flood control.

Storm victims, along with the rest of us, need this Government issued report and its statist and aggressively interventionist recommendations like victims of lung cancer needs more cigarettes!!

David K. Meller

Cindy S June 12, 2006 at 6:20 pm

If buyers are more concerned with saving money, and cosmetic things, than quality underlying construction, it is only because they don’t realize quality isn’t a given. Most buyers assume there ARE strong controls but are surprised to find out there’s not, when they have a construction defect case.

Most buyers don’t know–and shouldn’t reasonably be expected to know–how to build a house properly. But in reality they really have to know enough to spot good construction when they see it, or they will end up with one of the crummy builders.

Sadly, many home builders don’t know proper construction, either. Builders “supervisors” often don’t even know major defects, and/or they don’t care.

Builders have often opposed stricter codes even when the requirements don’t raise the price of a house that much. What the builders object to is accountability. If they were held to higher standards, they’d have to use more skilled labor, do a better job of supervision, and stop taking shortcuts. Many new homes do not even meet existing codes. The same type of shortcuts are taken again and again, in homes of all price ranges.

A few thousand per house from all the shortcuts can add up to a nice profit in the builder’s pocket. Amazingly, the industry spins this to be a savings passed on to the buyer. They buyer then has to fork over thousands in repairs and perhaps also legal fees, etc, to bring the house up to snuff later.

Home buyers do need to be more educated. Not only about construction, but contracts, loans, and legal issues. Educated buyers DO care more about quality than trim, because they know that quality construction and building code compliance are not a given.

Roy W. Wright June 13, 2006 at 1:01 am

And if I, as a buyer, don’t want a house to meet the housing codes? If I, as an individual, prefer low cost to quality for whatver personal reason? Is that concept even possible to grasp in your world?

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