Blogs > Liberty and Power > Government's Track Record in the Insurance Business

Aug 13, 2009 11:24 am

Government's Track Record in the Insurance Business

Barack Obama and many others want the government to get into the health-insurance business. Very good. Is the government in any other kind of insurance? As a matter of fact, it is: flood insurance. It essentially has a monopoly. Here's a Reuters story about the House last month extending the"troubled [i.e., broke] program" for six months while postponing a comprehensive overhaul. Why does it need an overhaul?

The program has been deep in debt ever since the costly hurricane seasons of 2004 and 2005. Repeated rescue efforts have failed....

[T]he administration said it favors forgiving the 40-year-old program's $19 billion debt.

This would not be the first time the program was bailed out by Congress or had its huge debt forgiven. This trouble did not begin with Katrina. See this article I wrote 16 years ago. (Scroll down.)

About the postponement of comprehensive reform, Reuters reports that Financial Services Chairman Barney Frank"said discussion on repairing the program needed to be put off due to other pressing matters, including healthcare and financial regulation reforms."

Translation: Government can't fix what it's already screwed up right now because it's too busy screwing up some other things.

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