All Commentary
Sunday, October 1, 1972

Flood Relief

If a flood destroys my property, am I thereby entitled to yours?

Aside from lives lost, early estimates of flood damage when tropical storm Agnes moved up the East Coast in June 1972 approached $2 billion, two-thirds of it in Pennsylvania.

What does one think as he sloshes and scoops and picks through the rubble and slime and stench, sorting what might be saved from what can’t or shouldn’t?Hours of steady, heavy downpour. Rivulets turning to torrents. Warnings and a rush to evacuate known flood plains and other low-lying areas. Bridges out. Cars stalled on flooded and debris-strewn highways. Daring boat and helicopter rescues of hapless victims. Trees uprooted, lawns and fields eroded, homes and cabins and trailers inundated if not upset or washed away entirely. Basements filled, motors and transformers and electrical appliances ruined, wells polluted, broken gas and water mains — and the fires, burning to the waterline with no way to get fire-fighting equipment to the scene. Water rising in the street, into the lower and sometimes the upper stories of homes and places of business. Services swamped, or entirely out of business. Rescue and relief stations. Emergency hospitals, housing, feeding, clothing, pumping, water testing, vaccinations.

Then the crest passes. Owners —and probably some looters—wade back to survey the damage and carry on the salvage, repair, restoration — or further destruction.

What does one think as he sloshes and scoops and picksthrough the rubble and slime and stench, sorting what might be saved from what can’t or shouldn’t? Give thanks that so many lives were saved, that not all property was destroyed? Pray that the sun may shine! Regret the hours and funds expended to build what is gone! Wonder what part of the loss, if any, might have been covered by insurance! How to deduct the rest from his income tax! How to obtain a grant or loan! How to build or hedge against future flooding! Feel sorry for all victims, but especially sorry for himself!

$2 Billion in Perspective

Perhaps it might take some time, perhaps it might never occur to most victims of the flood damage to view the $2 billion in perspective. The toll taken by Agnes in lives and property in the United States is roughly equivalent to the cost of one Apollo mission to the moon — or two weeks of U.S. involvement in Vietnam — or 4 days of government expenditures on domestic welfare programs — or 30 hours of total spending of taxpayers’ property in the U.S.

To be sure, it is no way to measure the total loss of one man’s business, his home, his life savings — say $100,000 — as amounting to an average of half a mill for each person in the United States, or the $2 billion total flood loss as an average of $10 per person. Any loss of private property falls entirely upon the owner of that property, just as a lost life is always that of some one individual. And any loss of “public” property, such as roads, streets, parks, schools, post offices, libraries, sewers, water systems, fire stations, and the like, falls proportionately upon the taxpayers of the unit of government involved.

The real loss is in the removal of $2 billion from the market in scarce and valuable goods.Yet, the real loss, wherever the burden falls, is not in the disappearance of $2 billion of money or currency. Rather, it is a removal from the market of $2 billion worth of scarce and valuable resources — materials and services no longer available to help meet current demands. And in this sense is a storm like Agnes equivalent in destructive power to an Apollo moon shot. It destroys or removes from the market $2 billion worth of scarce and valuable resources for which willing customers and property owners had in mind, and in fact, other uses. The fact that a moon shot assesses the $2 billion damage against a broader group of property owners — at an average of $10 per man, woman, and child — does not render it less destructive on the whole than storm Agnes which hit Pennsylvania hardest. The toll in property, and lives and livelihood dependent on that property, is about the same in both of these catastrophes.

When Federal, state, and local governments spend well over $200 billion a year waging various wars against communism, famine, pestilence, ignorance, poverty, this means that property, lives, and livelihood are being withdrawn from the open market of willing buyers and sellers at the rate of a storm like Agnes about twice a week. And recent flood victims can testify, that’s a lot of resources down the drain.

It may be argued, of course, that space exploration is well worth $2 billion a shot. And who is to say him nay if any individual wants to risk his own life and invest his own scarce and valuable resources in such research and exploratory ventures? Or to fight communism in Vietnam? Or to support the prices of farm products? Or to carry out various other welfare programs? Or whatever else an owner voluntarily does with his property in ways not injurious to other peaceful persons?

What is deplored are devastating forces raging out of control — coercive power that destroys the lives and the property of innocent and unwilling victims: a violent storm like Agnes, a moon shot or any other government project that is not essential to the defense of life and property and that might not be done if the doing depended upon willing buyers and sellers.

Violent Recovery?

How do individuals, how does an economy recover from an Agnes-type disaster? According to the Wall Street Journal, July 13, 1972, “Flood relief funds exceeding $1.7 billion were requested by the President… to meet fully the requirements of some 115,000 homeowners and 6,000 businessmen in six states who sustained flood damage… 30-year loans at 1 per cent interest, and repayment on the first $5,000 wouldn’t be required… the largest single amount [$1.7 billion] ever allocated for a recovery effort.”

The proposed program of coerced relief from Agnes is simply another disaster of almost the same proportions.One’s heart bleeds for the victims of Agnes, especially if he happens to be one of them. But the harsh fact is that neither the President nor the Congress possesses $1.7 billion worth of scarce and valuable resources to give to flood victims. The proposal is to take that additional amount of resources, by the coercive power of taxation, from present owners, at an average rate of $8.50 per man, woman and child — at a substantially higher rate, of course, from the smaller number who pay taxes directly: the producers, savers, investors, workers and providers of jobs and goods and services. But where does the brunt of this $1.7 billion burden eventually come to rest? It rests upon the jobless, the homeless, the hungry, the sick, the aged and feeble — upon the victims of inflation! For the fact is that the U.S. Federal government will resort to the printing press to extract an additional $1.7 billion of scarce and valuable resources from the market. And the resultant higher prices and costs will, in effect, bar from the market the least affluent among prospective consumers.

The proposed program of coerced relief from Agnes is simply another disaster of almost the same proportions. And this, bear in mind, does not begin to encompass the demands that will arise for dikes, diversion dams, and countless other flood control measures in areas subject to chronic or occasional flooding — all at taxpayer expense.

The Voluntary Way

Admittedly, this is no simple, easy problem to resolve. And of only one thing may anyone be certain: There is no possibility of a solution unless the owners of private property stand ready to shoulder full responsibility for the use of such property, including any loss as well as any gain accruing from such use. To help a man build — or rebuild — on a flood plain, if he cannot bear to be flooded, is no service to him or to society.

The tide of welfarist protectionism and government regulation and control of our lives is at flood stage.To cite facts and principles in the face of perhaps the worst natural disaster in American history may seem unrealistic. The voters of America, generous to a fault, are far more apt to applaud than oppose in the wake of Agnes a major government relief program. Indeed, individuals might voluntarily contribute $2 billion of scarce labor and other resources to such an effort. But, of course, we shall never know, in our present state of dependence on government force to satisfy human wants.

Nevertheless, one is bound to call attention to the inescapable fact that government is force, and that unlimited force is unbearable tyranny. Somewhere, sometime, somehow, each of us must face the issue and draw the line if he would perserve his freedom and human dignity. The tide of welfarist protectionism and government regulation and control of our lives is at flood stage. Will the American people build and man the dikes, and do so voluntarily? Or will we continue to build houses on sand, in the flood plains, in the naive faith that the flood will curb itself and care lovingly for us from cradle to grave?

  • Paul L. Poirot was a long-time member of the staff of the Foundation for Economic Education and editor of its journal, The Freeman, from 1956 to 1987.