Sunday, September 11, 2005

Compensating victims

The Becker-Posner blog says we should treat compensation to victims like an insurance company would. Pay for losses incurred by people unable to insure themselves (for instance, if they were too poor). I think that's a fine idea, though I disagree with some of the way they play it out.

I favor sticking people with the bill rather than offering flood insurance or government support when they build in a floodplain and know that the area floods every n years (for n less than something like a lifetime, say 50 years). If you know the house will get flooded, you should suck it up.

That's not quite the situation with Katrina. To treat this like any old flood would be like saying all the deaths on 9/11 should be covered by life insurance.

I thought it was a bit inequitable that the 9/11 compensation went to every family according to the earnings potential of the person who died. The family of a very rich person is, in principle, better situated to survive without the breadwinner and has taken a smaller increase in risk of poverty than the family of a person earning minimum wage. That person's family was already at great risk. If he was the sole wage-earner supporting a child, or a sick relative, those people stand a chance of being left entirely without income.

There's an argument to be made for paying a flat rate per body, or paying only according to the person's age. I'm not saying the system was horribly broken, but I'm not sure it was entirely equitable.

That's the precedent, either way. Every person who died in No Man's Land should get compensation to family according to earning potential. Every house lost should be compensated according to the same standard.

The only reason people don't expect this result is that the World Trade Center was full of incredibly rich (white) people, while the losses in No Man's Land are principally poor (black) people. As I've said, I think race is secondary, but it shouldn't be ignored.

Yes, that was terrorism, this is a natural event, but I don't see how that makes a difference.

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