I was recently in Fort Myers Beach, Florida for a short time. The beach on the Gulf of Mexico is beautiful. One thing I did not expect is just how much the city is still recovering from Hurricane Ian, which was just short of being a category 5 hurricane when hitting shore.
There were many condos and apartments on the beach that were vacant. The windows were boarded up if there were windows at all. The hurricane hit in September 2022. Over a year and a half later and they are still not even close to being back to normal.
There was massive flooding, as well as wind damage. All of the buildings I saw on the beach that weren’t new would have been underwater during the storm, or at least the entire first floor would have been.
I spoke to someone who lived just north of Fort Myers. He said that houses that had a certain amount of damage had to be torn down and rebuilt to new code. In other words, you could have a house that could be fixed for far less than the cost of a new house, but it won’t get fixed.
The government has the building codes that have to be followed, but the insurance companies are really part of the determination. It wouldn’t make sense to pour $50,000 to fix a house and then have another storm come along and do the same damage again. I don’t know, but I expect new houses have to be built on stilts or be raised somehow to not get flooded in the main living area.
Some people think that the government building codes are good and necessary. But this is just government hopping on board the parade. If anything, government distorts things by often subsidizing insurance for places being built in high-risk areas.
Strict building codes in the United States are only possible because of the wealth that Americans have. When there is an earthquake in a third-world country, you see massive devastation. Sometimes there are thousands of people dead. In the U.S., you might have just a few deaths from a similar incident.
You could implement these strict building codes in a third-world country, but if they were strictly obeyed then almost nobody would have a place to live. It wouldn’t be possible to build houses to a strict code with the lack of capital.
In a free market economy, insurance companies would set the standards. They wouldn’t be willing to insure a house made out of sticks near the beach. In addition, a mortgage company wouldn’t be willing to lend money to someone using a stick house as collateral. You would be free to buy land and build a stick house, but it’s not likely anyone would loan you the money to do it, and nobody would give you insurance.
Voluntary Action
One of the problems with government interference right after a disaster hits is that it is typical to have so-called anti price gouging laws. In other words, sellers are not allowed to sell products for what they are worth in the market.
If you have a shortage of bottled water and generators, the last thing you want to do is prevent sellers from raising prices. You need higher prices to help meet consumer demand. You want to give buyers an incentive to conserve, and you want to give sellers an incentive to direct more supply to that area.
As with anything, the only role of government should be to protect people’s lives and property from aggression. If there are evacuation orders, they should be voluntary. They technically usually are voluntary. It’s just that you won’t get emergency services during the storm if you are in trouble.
It is probably difficult to get contractors after the storm is over and the recovery begins. You think about this one small area, and all of a sudden there is a massive increase in demand for roofers, plumbers, electricians, and other contractors. Again, if you allow higher prices, it gives incentive for workers to go to that area.
It was kind of sad to see the place so long after the storm hit. It was a beautiful day on the beach, and I even spotted a dolphin swimming near shore. So, it was mixed emotions. There was one building that looked nice that was occupied, probably with tourists. I have no idea if it was a new building or if it was fixed up from the storm. I was just surprised how many buildings were still sitting empty.
I heard that there were restaurants that used shipping containers to serve food. I also heard that a new Margaritaville restaurant had opened up. There were some shops that were open. There was definitely activity, so it’s not as if the city is dead and not coming back. Farther inland was busy. If you were far enough inland to avoid significant flooding, then this is the big difference maker. It is usually the difference between a livable and unlivable house.
The nice thing to see is people coming together. We talk about voluntary action of people exchanging goods and services using money. The reality is that when there is a disaster, people do come together and help each other. They will give up their own time and resources in many cases to help their neighbor.
Conclusion
There are always disasters in life. Government interference usually makes them worse.
It is possible for government to direct money to disaster areas. This may or may not help. But this has never made sense to me because there are many people who suffer tragedy who get nothing.
Why did the families of the victims on 9/11 get money? This almost seemed like an admission of guilt from the government. But it was to show how much politicians can care with other people’s money. You could die of a disease or an accident, and your family isn’t getting anything from the government. You depend on insurance and charity, if anything.
In spite of government, it is good to see people come together on a voluntary basis and make things better. The hurricane gets covered by the news media well when it happens, and then everybody not in that area forgets about it. The people in Fort Myers Beach haven’t forgotten. Some of them have moved to other areas. But there is still a spirit of recovering and getting back to normal with buildings that will be stronger than before. This would have happened without building codes.