Introduction: Amid all the cries for government action to improve disaster relief, and to rebuild the entire city of New Orleans, the libertarian desire for less government involvement has seldom been heard. Accordingly, I have asked two friends who know libertarianism far better than I to contribute this letter. — Loren Cobb, Editor (from Lima, Perú).
Libertarian Remedies for Future Katrinasby Jerry Van Sickle and J. D. Von Pischke
The libertarian point of view emphasizes self-reliance, voluntary cooperation, and the benefits which will follow for those who are most vulnerable. Many examples of individual initiative and official failures occurred during Hurricane Katrina's horrifying aftermath, but few discussions of that disaster have emphasized the underlying causes or the libertarian responses that will be suggested here.
In spite of these recent failures, most citizens and many libertarians may still accept the management of emergencies as a legitimate and necessary function of government. So it's time to ask an important question: What will happen if individuals, voluntary groups, neighborhoods, and businesses decide to provide solutions, before and during disasters, to supplement helpful government action?
TQE readers may agree that deep-seated weaknesses and dangers exist wherever goods and services are provided by a monopoly or under a single chain of command. Many of the causes are understandable: deference to seniority; long traditions that discourage new ideas or reforms from within; friendships and loyalties that resist outside influences. The burden of responsibity for changing directions after years of emotional and physical investments invite caution and conservatism. Maintaining consensus and teamwork are difficult — and unwinding red tape may be impossible. The most recent and glaring example has been the failure to integrate the CIA, FBI, FEMA, Homeland Defense, State Agencies and local first responders — in spite of overwhelming public and political pressures during the four years since the terrorist attacks on New York City and the Pentagon.
What is missing is the creative ferment and positive incentives of competition. New or better ideas are often initiated by unrecognized geniuses and visionaries, or by ornery upstarts and outcasts. Those who are unable to endure the constraints of bureaucracy become the yeast that keeps conservatism and political establishments from stifling the search for improvements. The advance of science throughout history offers a profound example of the discovery process and its official opponents.
A multitude of individuals, startup firms, and corporations are needed to create, fund, and test endless new possibilities. Any successes will lead most competitors to improve their products or services, and a few will launch another round of improvements and breakthroughs. This is the story James Burke showed us on public television a few decades ago: each invention triggers many more in an endless cascade. The result has been an industrial and computer revolution that constantly gives birth to improved or less expensive products and services.
In contrast, the drawbacks of a single supplier are compounded in areas that apply especially to emergencies:
In New Orleans federally funded levees and flood insurance undermined the need for investors, lenders, and private insurers to demand reliable protection or safer locations for their buildings. By-passing powerful financial checkpoints may account for the loss of many lives and billions of dollars.
Earlier generations formed fraternal organizations whose dues created a pool of savings for their unlucky members. Their members knew each other and would help those who were deserving and unable to care for themselves. Today's large insurance firms must look for less personal ways to remove the temptation to misuse or profit from insurance. The last thing they are likely to do is insure anyone to build or live in the path of predictable flooding.
Seen from an insurance point of view, flooding differs from hurricanes and other insurable losses in which the number of actual victims is small compared to those at risk. Potential flood victims form a much smaller risk pool, and nobody on higher ground needs to share their risk. So the basic ingredients of insurance are missing.
Government has defied these basic principles by insuring buildings and lives in harms way. Congressional logrolling and pork barrel politics, backed by taxpayer sympathies, enabled their neighbors and the politician's own constituents to build in the path of predictable flooding. Given such harmful enticements, the outpouring of concern and help after Katrina may be altogether fitting and proper.
Tragedies caused by human kindness are hard to acknowledge. We understand the concepts of tough love and of enabling self-destructive behavior, yet our government invited people to live where their lives are at risk, and may soon enable them to build there again! Will all these lessons, and all the lives lost, be in vain?
Libertarian Remedies for these Tragic Mistakes
Can the same approach apply to terrorist emergencies? The owners of tall buildings, stadiums, airlines, and the shipping industry will probably be the first to search for self-funded ways to reduce risks and facilitate escape. To offer a single example: many upper story connections between tall buildings could provide multiple escape routes, and strengthen buildings from unplanned stresses. Added rents could fund the project and repay taxpayers for the use of their space above public streets. Endless brainstorming of this sort wll appear in trade journals, and actual investments will then create an ever-increasing portfolio of ever-improving remedies for disasters caused by man or Mother Nature.
Issues raised by Hurricane Katrina reveal a widespread hope that government itself can be our shared insurance agency. But political pressures, incentives, and monopolies produce the opposite results. Politicians are bound to favor more visible projects and powerful interests over adequate safeguards. Legislators and public officials are not liable for the results of their decisions.
Libertarian remedies will reverse today's perverse incentives. Multiple investors, suppliers, insurers — and taxpayers — will then be led to seek optimum safety for human beings coupled with the optimum protection of buildings and cities where they live and work.
We welcome reactions, along with more and better proposals.
Jerry van Sickle and J. D. von Pischke
Note: Please send comments on this or any TQE, at any time. Selected comments will be appended to the appropriate letter as they are received. Please indicate in the subject line the number of the Letter to which you refer!
In the absence of strong government, who will do the honoring, encouraging, directing, and allowing the libertarian principles outlined in numbers 1 to 6?
I too believe a libertarian society is best. But I believe a libertarian society must exist before a libertarian government. That will take a long time, maybe a century or more. Culture change is not quick.
— Jack Powelson, Boulder (CO) Friends Meeting.
Your first tenet, to "Honor promises to pay for losses, but only once and only on properties that are fully protected or are on higher ground," would result in the poorest of the poor losing everything they have while the wealthier would get reimbursed for their losses. The people who have built houses in the worst flood zones of New Orleans, e.g. the Ninth Ward, have done so because they have little and that is what they can afford. Not paying for their losses would be unjust, in my opinion.
— Ann Dixon, native of New Orleans.
It is clear that government (at least in the US) does not have the capacity to do it right. Whether there are realistic alternatives is not so clear. We are now learning that the Red Cross is also bogged down — it is a large organization too. Jack is right that the poor always suffer. I think the best we can do is a mixed economy solution, where we encourage the kind of private initiative you discuss, while seeking appropriate oversight from society (yes, regulation).
Jack's ideal future, in which society gurantees that no one is truly poor and leaves much of the rest up to individuals, seems to me attractive. That needs a lot of government regulation to share the wealth, but then leave people alone. Of course some of them will then choose to be poor anyhow, perhaps as a result of menatl illness.
— Bruce Hawkins, Northampton Friends Meeting (NEYM).
I'm sorry, but for sound mathematical and ecological reasons the proposals for more private insurance and participation in natural disaster prevention or mitigation just won't work in the real world. Insurances depend on data collection and an assessment of likelihood and probabilities. These make possible mathematical conjectures as to margins so that premia can be matched to a range of outcomes. This is the necessary premise for all viable insurance, and where the scale, range, target and magnitude of unknowns is even unconjectural — as is the case in a world of climate change — the bases of private insurances collapse. It is simply impossible to prepare insurance, investment, or stand-by, in situations which, by their defining nature, elude all such categorisations.
The recent earthquakes in Pakistan (presumably occurring after your piece was written) demonstrate that magnitudes and effects are simply not assessable in advance to any intelligent degree. The only rational structures to prepare for these eventualities stem from a willingness to abandon the cliches of disapproval for taxpayer involvement, or federal responsibility, and see the problem in its reality: we are all, world-wide, essential supporters and aid-workers of each other when it comes to catastrophes of this sort. Belated private contributions, whether of cash or aid, are precisely that — belated, i.e. too late.
It requires a very different mindset which can assume a collective responsibility for the well-being of all humanity. The public involvement needs to be enlarged and extended not diminished. In particular, as climate changes will almost certainly make migrations essential for the safety of people on all continents, including the north American continent, we would be better advised, as of now, to undertake socialist and community reciprocities for the imminent upheavals which are not only likely (though unpredictable) but virtually certain.
— Ian Flintoff, the Quaker Socialist Society, and Westminster Monthly Meeting, London UK.
Weak governments can be even worse if Germany of the 1930s or Russia of 1910s are any example. Or the weak northern alliance government that allowed an even worse Taliban to come to power. The problem is the citizens lack of transparency about their government, when that happens World Peace will have a real chance.
The national guard claims to have saved 11,000 lives during Katrina. I see no private organization willing to spend millions of dollars on that many helicopters, just to have them sit around in case of a emergency. Pakistan also shows that even with millions coming in you need a military to deliver the supplies, because if the transportation infrastructure is destroyed only the military has the capacity to deliver the aid in time.
— Doug Anthony, La Jolla (CA) monthly meeting (attender).
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PUBLISHER AND EDITORIAL BOARD
Publisher: Russ Nelson, St. Lawrence Valley (NY) Friends Meeting.
Members of the Editorial Board receive Letters several days in advance for their criticisms, but they do not necessarily endorse the contents of any of them.
Copyright © 2005 by Jerry Van Sickle and J. D. Von Pischke. All rights reserved. Permission is hereby granted for non-commercial reproduction.