And then there's the effect on the nation's real estate market! The Sacramento Business Journal reported that in Sacramento county alone, since no home buyer can get a mortgage without flood insurance, thanks to a filibuster by Republican Senator Jim Bunning for several days, the National Association of Realtors estimated that about 1,400 real estate transactions a day were stalled during the lapse.
So if we got rid of the National Flood Insurance Program, in every county nationwide that requires flood insurance, which includes most cities on or near a river, the real estate market would come to a screeching halt. What would that do to our nation's economy? Of course, this is only for the citizens who actually decided to stay in flood-prone areas despite the fact that there was no flood insurance available. One also has to wonder what the owners of tens of millions of acres of farmland would do when their crops were destroyed by floods, if there were no flood insurance. As I said, Ron Paul didn't think things through.
But this article was also about FEMA, wasn't it? So let's think about what Ron Paul said, that people should rely on insurance alone (as if everyone can afford insurance). What happens when a major disaster hits? Let's look at the Jones family who just lost everything, absolutely everything but the clothes on their backs, and we all know that in major disasters, such a scenario is not at all unusual.
What do the Jones do in Ron Paul world? They thank God that they're still alive, and they wait for the insurance adjusters. Now said insurance adjusters (who may or may not have also suffered in the same disaster) are going to be trying to make it to all those covered by the company, and the numbers of their constituents can run into the thousands. So the adjusters have to each find their way to the addresses, if the addresses can be found after said disaster, mind you, and try to do their jobs. And then the real frustration starts. Why? Because if the insurance adjuster does not personally know the victims, then the victims have to somehow prove who they are, and this can be problematic if identifications were lost in the disaster. Furthermore, does the insurance company cough up money immediately? And in the unlikely event that they do, is there even a place where the victims can readily purchase food and water? Bear in mind that all this is if the insurance adjuster can find them in the first place, since they may be at what is left of their residence, or they may be in an aid shelter, or the may be someplace else shivering in the cold. And they need most of all what the insurance company does not provide (and what local charities almost certainly cannot provide enough of in a truly major disaster): food, water, blankets, clothing, medical aid.