Latest / The Fiscal Policy Podcast with Fexingo: Government Budgets, Stimulus, and Public Spending
Why the Government's Flood Insurance Program Is Drowning in Debt
The National Flood Insurance Program is over $20 billion in debt, and its pricing model is decades out of date. In this episode, Lucas and Luna dig into how the program was born from a private-market failure in 1968, why it charges the same rates to a beachfront McMansion and an inland bungalow, and how recent attempts to fix the pricing — like Risk Rating 2.0 — ran into political fire. They trace the weird incentives that keep subsidized rates alive: coastal homebuilders, real estate agents, and lawmakers who see cheap flood insurance as a development subsidy. They also look at what happens…
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