Before Hurricane Katrina, Americans took natural disasters and financial setbacks in stride. Americans are a resilient bunch and used to be able to take many setbacks on the chin but not anymore. Today, more and more people have their hands out for help whether they truly need it or not. People think that they are “owed” something for their lot in life.
I grew up in Charleston, South Carolina, and my parents and I lived through Hurricane Hugo in 1989. Thankfully, we did not have too much damage to our home. Like most hurricane victims, we needed new shingles on our roof, and my parents’ homeowners’ insurance covered the cost of the repairs (minus their deductible, of course).
No one received a government handout in 1989. We did not get Visa debit cards from the American Red Cross. In those days, if you needed help, you went to the Red Cross shelter that was the high school gymnasium. The bailout trend did not take off until Hurricane Katrina struck New Orleans in 2005. Federal and state governments should not bailout individuals or even businesses for that matter. That is what insurance is for. Why are we subsidizing people for needless risk and ill-preparedness? When people used their government sponsored handouts in Louisiana for frivolous purchases that were not related to hurricane displacement, that should have been the proof needed once and for all that government bailouts do not work.
Now, people think that the government owes them something for the littlest wrong that happens in their lives. But, they have failed to remember that those events are just life. Things happen that we cannot explain. We should always hope for the best but prepare for the worst. Our government is not the backstop for disasters, natural or manmade. Insurance is the backstop that should be used in these situations. When banks fail the Federal Deposit Insurance Corporation…insurance backs us up. When a hurricane blows your house down, insurance helps you rebuild. The only industry in America that has a reasonable rationale for any type of bailout would be the insurance industry.
But, we have already fallen down the slippery slope. Now, the nasty trend has developed where everyone has their hand out for help regardless of real need. What will happen years down the road when a new person is in the White House and help will not be readily available? Most people do not really need help. They are being rewarded for taking too much risk. What are we teaching the people that the government is bailing out? We are teaching them to continue their risky ways because the government will always be there to help them keep their McMansions without paying all of their mortgage balances. The tax payers would not have benefited if these corporations and individuals gambles had paid off handsomely. Why should we subsidize their losses now?