From: Ryan Grim [mailto:ryan.grim@xxxxxxxxxxxxxxxx] ;
Sent: Sunday, October 15, 2017 9:50 PM
To: miriamvieni@xxxxxxxxxxxxx
Subject: The $16 billion flood insurance giveaway, while House Republicans warn
Congress not to "bailout" Puerto Rico
As of now, roughly 85% of Puerto Rico is without power. Torrential rains swept
away entire towns and laid waste to the roads needed to get supplies to them.
With essentially no economic activity and no tax collection to speak of, the
government is about to run out of cash. The response from Congress has been to
offer Puerto Rico a $5 billion loan.
Meanwhile, the flood insurance program is getting a $16 billion debt wipeout.
Why a loan instead of a grant, the type of aid often given to a region in the
U.S. devastated by a natural disaster? Rep. Mark Meadows, the chairman of the
Freedom Caucus, explained to The Intercept’s Aida Chavez that “for them to
suggest that it’s fair, for someone in another state to put forth money that is
not just directed at relief, to bail out a government, whether it be Puerto
Rico or Illinois or some other state, is not fair for a state that’s been
fiscally responsible.”
Washington loves its metaphors, but man, deploying the word “bailout” while
Puerto Ricans are still literally bailing out from a hurricane takes an extra
level of detachment.
In the same bill, the flood insurance program is getting its above-mentioned
bailout, so to speak. In a few weeks, that program expires, meaning rules
around it are being rewritten now. It’s one of the first legislative debates
that is being forced to consider the impact of climate change, even as one side
refuses to admit it’s real. But when money is involved, that’s harder to do.
Here’s Kate Aronoff’s story on the latest politics of the flood program.
An Increase In Catastrophic Storms Makes Calls To Reform the National Flood
Insurance Program Urgent
THE SENATE IS expected to vote this week on $16 billion in debt forgiveness for
the National Flood Insurance Program, continuing the bizarre bipartisan
politics that have defined the beleaguered FEMA program. Meanwhile, Congress
has less than two months to decide whether to reauthorize the NFIP, renewing
calls for an overhaul of the program made especially urgent by the climate
change-related increase in catastrophic storms.
The House approved the debt forgiveness in a 353-69 vote on Thursday. As The
Intercept previously reported, the bill cancels two-thirds of the flood
program’s debt while offering Puerto Rico a $5 billion loan from the U.S.
Treasury—a baffling move considering the small island is already at least $74
billion in the red to a number of mostly foreign creditors who aren’t about to
give up their investments without a fight.
The difference? Puerto Rico is effectively a colony of the United States. The
National Flood Insurance Program (NFIP) happens to help a lot of millionaires.
For that reason, the NFIP has historically been a rare spot of cross-aisle
agreement, with loyalties divided more along geographic lines than partisan
ones. Because homeowners living in floodplains are required to purchase flood
insurance, the politicians who represent coastal constituencies tend to favor
keeping rates low in order to keep them happy.
Yet the forgiveness—which came partially at the request of the White House—is
still something of a surprise. Prior to a few weeks ago, Rep. Maxine Waters,
D-Calif., who’s gained a considerable following among progressives for her
opposition to President Donald Trump, was the main advocate pushing for her
colleagues in Congress to forgive the flood insurance debt in its entirety.
FULL STORY
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