Tuesday, September 05, 2006

Mike's Eyes See The Unseen

With all the hand-wringing articles written this past week about how all the King's horses and all the King's men still haven't put Humpty Dumpty (New Orleans) back together again, I thought it would be good to focus attention not on those things that reporters, photographers and politicians can see, but on things that they can't or won't look at.

They can't see for example that in a laissez-faire economy, the government would not be permitted to interfere in the market in any way, that the government's sole responsibility would be to protect the individual rights of its citizens by providing a military, police and the courts.

What does this mean in regards to Katrina? It means that there would not have been Congressmen and Senators using altruism to pass legislation to provide flood insurance for people who wanted to open businesses or build homes on nothing more that Delta silt. The government would not have been allowed to build levees at taxpayer expense so that some people could live in a paradise at the expense of others. In short New Orleans probably would not exist.

But suppose a conglomeration of wealthy businessmen wanted to build there anyway and were willing to pay for the building and the insurance. Because they are motivated by the quest for profits, insurance companies would have some stringent requirements. I can see where they would insist that millions of yards of sand and soil be brought in to raise the ground level to or above sea level as was done after a hurricane devestated Glaveston Texas at the turn of the century. They would also demand that levees be built to withstand the worst case scenario--a catagory 5 hurricane. To insure those levees, the underwriters would demand that maintenance be performed according to a regular schedule. Inspections would be held to ensure the schedule was followed.

There would be other requirements as well. I can see where the insurance companies would demand for example that all buildings with back-up generators place those generators no lower than say, the third floor. I can see where businessmen would want to work with law enforcement and city and state government to ensure an effective evacuation plan. Of course this is all motivated by the profit motive.

But in reality, congress decided it would interfere in the marketplace to provide flood insurance. They were motivated by the ritual-oriented morality of altruism, not the profit motive. No politician stood to lose a cent if disaster struck and people died. A rational motivation just wasn't there. But an irrational one was, the ritual of "It's not for me I do this, it's for others." If you perform this ritual, it forgives all evil that may result.

It's obvious that Gov. Blanco and Mayor Nagin never bothered to ask what if. What if the city flooded with all those buildings having back-up generators on the first floor? What if it flooded and all those school busses were rendered useless? These and other questions were never asked. There was no motivation to ask them. Neither the mayor, the governor nor even the boss of FEMA would lose a fortune in any disaster. Nor would they stand to save a lot of money by doing things right.

The inefficiencies of government were slap-in-the-face obvious. It's way past time to get the government out of the crises preparedness business and let private enterprise handle it. This is not to say there is no role for government in the aftermath of a disaster. The government can and should have troops poised to move in and patrol the streets to prevent looting of homes and businesses until local law enforcement can regain control. The protection of property rights is a proper function of government.

Laissez-faire capitalism can prevent and at least ameliorate most human disasters. Notice also that there would have been no "projects" built by government to encourage able bodied people to adopt a dependency mindset and to make sitting ducks of the infirm and disabled of that group. The efficiencies of the private sector were only glimpsed in Katrina. But it is time to focus all eyes on the private sector and see what they need to handle the Katrinas of the future.

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