Letter From Washington: Heart-Warming And Wrenching

by Eli Lehrer on March 29, 2011

photo by suttonhoo/Flickr, used under a Creative Commons license

The California Earthquake Authority has hired the PR firm Ogilvy to monitor everything that’s being said about it. I know because an Ogilvy employee—an acquaintance of mine it so happens—e-mailed me a 693 word response to a 225 word press release that Heartland put out condemning a proposal from Senators Feinstein and Boxer to provide CEA with massive taxpayer subsidies. The Ogilvy employee said it was “on background” so I’ll respect that.


The Terrorism Risk Insurance Act (TRIA) is up for renewal in just three years (2014).  The program, which imposes a virtually limitless liability on taxpayers and promises a national insurance premium tax following a major terrorist attack, is not the best.

That said, virtually all primary insurers want it renewed and there’s currently no private market for terrorism insurance. Some reinsurers think that they can write the risk. I’m somewhere in-between. On one hand, I think that there are some workable alternatives (I discuss one here) to TRIA and that the private industry, in time, should write almost all terrorism coverage. On the other, I can’t see anything but a two-track system as a likely possibility in the short term.

Heartland is going to be doing a lot more on TRIA as we move towards reauthorization.


There’s a story – at once heart-warming and heart wrenching – about a chef who has worked to provide free pasta to “motel kids” in California. These motel families are particularly common around Disney World in Anaheim where lots of older motels have been converted into modern single room occupancy hotels.

Contrary to the implication that the article makes, the motel kids aren’t remotely new: when I visited with the Anaheim Police Department in 2000 and 2001, several people told me about efforts to help them. Families have been living in motels since at least the 1980s.

Three observations: it’s the fault of liberals, it’s the fault of conservatives, it’s not all that bad anyway.

It’s the fault of liberals because “growth management” has made it difficult to build new housing. Efforts to prevent sprawl (in a place where everyone drives on freeways) and protect the environment  have made it very hard to build inexpensive new housing for lower income families while making things, well, prettier, for the already well-to-do.

It’s the fault of conservatives because property tax caps and housing project laws have made it difficult to build new housing. Caps on property taxes have made “land banking” attractive to developers and made purchase prices of property higher. In addition, a de facto bad on new subsidized housing (written into California’s housing law) has made it harder for governments to build new developments anywhere. On balance, governments should help people with vouchers, not directly subsidized housing but there’s

That said, it actually isn’t that bad. Visible homelessness – which I’ve never seen in Orange County myself – exists in many large cities because urban planners tore down skid-row single-room occupancy hotels and leftists (my father among them) destroyed the business model of those that remained by demanding that they act like landlords rather than the hotels they are.  For some people who have significant drug, alcohol, or mental illness problems but are still capable of living independently, privately-run rent-by-the-week accommodations are the best housing option.

It’s unfortunate that children end up in these places but, even if their parents have problems (and I have no idea about that), it’s almost certainly better than forcing them into foster care.

Until next week,

Eli Lehrer, Vice President, Washington, D.C. Operations

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