Rep. Ron Paul questions value of federal flood aid for victims of Hurricane Sandy

Rep. Ron Paul (R-Texas) said Monday that the billions of dollars in damage Hurricane Sandy caused in New York and New Jersey raises "uncomfortable questions" about whether taxpayers should continue to pay for the cleanup from natural disasters.

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While many New York and New Jersey members are calling for billions in additional funds, Paul said on his website that the government will continue to lose money by insuring these sorts of events. 

The former GOP presidential candidate said most of the funding to help with Sandy will come from the Federal Emergency Management Agency (FEMA) and the National Flood Insurance Program (NFIP). But he said these agencies will only put taxpayers deeper in debt by writing checks.

"Many think there is a need for the government to provide flood insurance of this kind," Paul said. "After all, the market would never provide insurance in flood prone areas at an affordable price. But shouldn't that tell us something?


"Shouldn't that tell us that it is a losing proposition to insure homes in coastal areas and flood plains often threatened by severe and destructive weather patterns? And if it's a losing proposition, should taxpayers subsidize the inevitable losses arising from federal flood insurance?"

Paul said the NFIP in particular creates a moral hazard by making it more affordable for people to keep building and rebuilding in flood prone areas.

"The obvious and expected outcome is more danger to life and limb when disaster strikes," Paul wrote.

Regarding FEMA, Paul said that agency has a record of "mismanaged recovery and relief" efforts in the wake of Hurricanes Katrina and Ike. He said charities and private organizations are better equipped to help people that FEMA.

"Organizations such as the Red Cross and private companies like Home Depot and Duracell have already stepped in admirably to help those in need, and we can only hope FEMA has learned this time not to impede and frustrate private efforts as they have in the past," Paul said.

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