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Comment by kibwen | Hacker News Reader

> Second, governments and private companies should be looking at (socializing) mitigations that will keep risk within tolerable levels

The moral hazard is killer here. I fear that in practice what this means is that the rest of the US will end up bailing out the gormless Floridians who refuse to stop building McMansions on the coast. Insert the gif of Bugs Bunny cutting off Florida and letting it drift off into the Caribbean.

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And the western US with their fires? Or the southern east coast that also gets hit with hurricanes? How about the increased flooding in the midwest? New construction size has increased across the US too. It's not a single zone.

Red states and the Federal Government don’t believe in climate change. Let them cover their own climate costs. California alone sends $86B to the Federal government. The moral hazard is covering the cost of bad faith actors acting in bad faith. Bootstraps and all that.

CA can't even get their own house in order. If they were serious, they would apply the wildlands fire code to all the new construction in LA after the recent fires, but they won't. The real moral hazard is thinking the risks, costs, and benefits are as clear cut as you're making them... plus the non-starter about implying not paying taxes.

They’re the world’s fourth largest economy (behind the US, China, and Germany), they’ll be fine economically. Red states actively choose to ignore climate change, with Texas going so far as to attempting to disadvantage renewables while supporting fossil fuels [1]. Florida’s insurance market is functionality insolvent [2]; they extend and pretend. Why would we financially help folks who don't believe in the active climate crisis? Vote for folks who dismantle FEMA? Vote for folks who rollback the inflation reduction act and climate mitigation spending [3]? Vote for folks who rollback vehicle emissions standards? Enjoy your vote. Better luck next time.

[1] https://prospect.org/environment/2025-06-05-texas-legislatur...

[2] https://www.bloomberg.com/news/features/2024-04-24/home-insu... | https://archive.today/g8Ic5

[3] https://www.lw.com/en/insights/one-big-beautiful-bill-new-la...

I'm not sure what you're even going off on at this point. You completely ignored my comment about how CA is handling things like fire code and fire insurance. It seems like youre just trying to start a political flame war.

I'm unsure how this isn't political. Some states are economic engines of the US, some states are net takers of resources. States that have resources by way of being economic engines should protect themselves from the coming impact of climate change (if one doesn't believe in climate change, or the impending risk it presents, don't bother replying, there is no common ground to be had). That's it, that's the thesis. How California is handling fire code and mitigation currently is somewhat immaterial; more importantly, they have the resources by way of their economy to fix the problem if and when they choose to (to spend to de-risk against fire risk). They have the economy of a developed nation state. They can spend whatever is required when they decide to appropriately spend. If you don't have the resources to defend against climate risk, or don't believe in the risk, you have little recourse against it.

This could've been a collective action problem at the nation state level; it no longer is due to political choices by people who believe a global climate phenomenon is a hoax. So those who can afford it must go it alone for the foreseeable future.

So according to you CA has the resources to rebuild themselves and should protect themselves, but you consider it immaterial that they are choosing not to protect themselves with fire code and insurance changes? This sounds classist - we can do whatever we want because we have money, but we don't want to pay taxes because that might help other states that are also making suboptimal choices. But both Florida and Texas (your examples) are also donor states. It's hard to find what the basis is for your thesis when it seems to be applied irrespective of the facts.

Yes, I am saying if you have the economic resources as a state, you should not help other states economically that do not believe in climate change (within the context of climate mitigation spending and transfers). Why would you help people working against you or who don't believe in what you're defending against?

Money is fungible, taxes don't work that way, both of your examples of FL and TX produce more fed tax revenue than they receive, so it's hard to see how you think this would apply.

States can increase their income taxes, which can be deducted against federal income taxes. This keeps the tax revenue internal to the state and avoids sending it to a federal government who would spend the tax revenue suboptimally. These funds can be spent on climate mitigation programs within a state. If your state has no income tax and relies on the federal government, that’s unfortunate (I suppose increasing property and sales tax is an option, if not regressive).

SALT limits have been bumped to $40k from $10k: https://www.nerdwallet.com/article/taxes/salt-tax-deduction

Lots of ways to make this work with policy.

Not really. They're still going to get the money, but the deficit will be bigger.

Love this line of thought. Tired of dealing with bible thumpers who can't understand the basic physics of carbon in the atmosphere. All productive states (aka BLUE states) should keep their money and tell the feds to FAFO at this point. We need to protect ourselves, if they want to have their idiotic belief systems that's too bad. "Don't appeal to mercy to God the Father up in the sky, little man, because he's not at home and never was at home, and couldn't care less. What you do with yourself, whether you are happy or unhappy - live or die - is strictly your business and the universe doesn't care."

Let's think about this. You say that Texas and Florida are "donors" in the same way as California is. But what do those states do? Take Texas. Its main industry by far is oil and gas -- an extractive and polluting industry, and one that causes pollution far and wide wherever the products are used. Any money that Texas has is paid for by current and future suffering, by causing the very climate change they say doesn't happen.

Florida is a tourist state. Everyone loves Disney and the beach, but any money from tourism is just brought in from somewhere else. Florida's tourism industry is also extractive, and tourist travel also causes untold climate damage.

But California? We have agriculture. We have software. We have logistics -- everything in your house probably came through Long Beach and on our highways. We even have our own Disney so we don't have to fly to yours. California's industries aren't extractive. They're productive. And we're careful to minimize or eliminate the externalities of our industries while we work to create the things you use every day. In many ways, California is America. Without us, the country would shrink and shrivel day by day until you've extracted all the good and left everyone else nothing.

"We have logistics -- everything in your house probably came through Long Beach and on our highways."

So high carbon as well. Texas, and Flordia especially also have ag. CA has a lot of tourism too. Claiming that CA is the only source of "good" is a bit over the top.

So, you believe that people with higher incomes and greater social standing should be permitted to make suboptimal choices with regard to climate sustainability? Is it really just a class thing more than the scientific implications of changing climate?

I agree that we also shouldn't be subsidizing the insurance of California houses built in the exceptionally flammable urban wild-land interface

California supplies a significant percentage of the federal budget -- more than your state in all probability. And our insurance industry is the fourth biggest in the world. We can afford to build anywhere we want, and any FEMA funding we get is just our own taxes repaid to us. Get good or get over it.

This is a short sighted view. Fire insurance in CA is high cost, if you can even get it. Many people would not in fact be able to afford building anywhere. The subsidy argument doesn't have to be at the federal level be even within the state from low risk to high risk areas.

> California supplies a significant percentage of the federal budget -- more than your state in all probability

Exactly as much as my state, as it so happens.

Seconded.

> And the western US with their fires? Or the southern east coast that also gets hit with hurricanes? How about the increased flooding in the midwest?

* Don't build in the WUI. Enforce/enact building codes that take into account NFPA's Firewise USA.

* Don't build on the coast. Enforce/enact building codes that take into account IBHS FORTIFIED techniques.

* Don't allow building / residency permits in floodplains.

The problem is mostly the existing homes. Things like flood zones have been increased in size. People rebuild on previous home sites, but code doesn't require those hardened techniques. You could build a house in a fire zone if you use the right materials and landscaping.

Insurance, homes, etc. are flows for the purposes of this analysis and so they aren't really that big a problem. Change the codes, so the stupid can't be recreated and it will handle itself as the old stuff is destroyed and not rebuilt/rebuilt in a way that can handle the reality of the situation with minimal insurance claim. Even if the rate of disaster doubles it's still an insurable problem in this setup and within 20-30 years the problem handles itself through natural aging out plus insurable destruction of the old stuff.

The key is to make it very easy to rebuild whatever you want within the constraint of new codes that ensure your building can handle its environment. If we let a california happen and hold everything up in development hell so almost nothing is being rebuilt six months to a year after the destruction is the real economy killer that is relevant here.

You have to be careful when applying moral hazard, because it's just authoritarian behavior with a more polite coating. There are times when it's appropriate and necessary to tell people what they can and can't do but I think this is a case where you either have to write and pass a law forbidding people to build and explicitly define the areas, even if it only forbids new construction, or continue bailing them out like any other natural disaster. This doesn't feel like a situation to "let the market figure it out" or abruptly pull disaster relief after the damage is done.

No, what's authoritarian is an unavoidable insurance scheme that ignores the concept of moral hazard. In fact, I am all for insurance, it's extremely efficient at large and an institution as old as humanity itself, but if you don't deal with moral hazard then the wheels come off the engine. If I'm in an insurance pool with a smoker and they break their leg, that's fine. If I'm in an insurance pool with a smoker and they get lung cancer, they better be paying more than me. Some things are decisions, not fate, and people need to be willing to bear the cost of their decisions. To the point, if that Floridian's house burns down or that Californian's house floods then that's fine; vice versa is the problem.

Easy. Don't apply the policy to new homes.

That' funny. In some cases the new homes have newer construction methods that make them more resilient, such as hurricane straps or better fire resistance.

People in red states can't afford those materials. Half of the houses in the Midwest still use PVC siding and wooden stilts in crawlspace. The first hot day or heavy rain they see and they start melting and molding. But that's all you can do on $30,000 a year from your Walmart job when every other employer in town leaves for the coasts.

If these were really common issues, the code wouldn't allow them. The melting siding is generally caused window reflections from other houses, especially with high efficiency windows. This happens all over the country.

This presumes that everyone who builds in coastal areas is "gormless" and deserves hardship. Millions of people live on islands and they don't get a choice where they build. Several Polynesian countries will disappear by the end of the decade. Are they "gormless"?

When you’ve rebuilt in the Dane location for a third or fourth time, on the same lot, why should we keep subsidizing the process? At what point do we say “you cannot build here any more”?

Even if that location is a fire-prone hillside in Los Angeles? Is the gormlessness of a housing choice correlated with the income of the homeowner?

At the very least houses should be required to be MUCH stronger, able to withstand 185 mph winds, which seems to be the highest ever for a Florida hurricane.

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