My new book, Texas Flood: Power, Money, Politics, History, Bureaucracy and Tragedy, is being published Tuesday, and it’s available on Amazon. In it, I discuss why I was sent to lead the Federal Emergency Management Agency (FEMA), how I would have shut down or radically transformed the agency, and how I overrode the Department of Homeland Security to ensure the people of Texas received the assistance they needed during one of six major fatal flash floods in American history.
I also discuss how the federally funded National Flood Insurance Program (NFIP) unfairly transfers wealth from around the country to scenic coastal communities along river and ocean shorelines.
If you have ever heard the song “When the Levee Breaks” by Led Zeppelin, then you’ve heard the echo of history that ended private flood insurance. The song was written by Memphis Minnie, not long after the Mississippi River breached the levees holding it at bay. That was 1927, and the flood damage bankrupted private flood insurance. After the Great Flood, as it became known, an estimated 700,000 people were displaced; many joined the Great Migration and moved north to places such as Chicago, Cleveland, and Detroit.
From the late 1920s until the 1960s, insurance firms would not issue policies for structures built in floodplains; it was actuarially deemed too costly and, therefore, bad business. Then, in the late 1960s, the federal government created a subsidized flood insurance program. From the start of this program, insurance companies could issue flood insurance policies at low premiums because the federal government subsidized the cost. In short, the burden of paying for flood damage shifted to all American taxpayers, not only the ones living in floodplains.
Eventually, the program landed at FEMA with the title National Flood Insurance Program, or NFIP. Since then, NFIP has influenced decisions to place buildings closer and closer to riverbanks and shorelines around the country.
Gilbert White, architect of the National Flood Insurance Program, wrote (1966): A flood insurance program is a tool that should be used expertly or not at all. Correctly applied, it could promote the wise use of floodplains. Incorrectly applied, it would exacerbate the whole problem of flood losses.
The original intent of taxpayer-subsidized flood insurance was to encourage insuring existing structures in areas at high-risk for flooding; it was to be phased out eventually. State and local governments were expected to couple NFIP with increased floodplain and land use management — think engineering projects like levees and local land use restrictions — to reduce flood risk and development in high-risk areas. Just the opposite happened; a building boom crowded high-risk flood areas with structures because taxpayer-subsidized flood insurance was available. Flood damage and associated damage cost ballooned. When storms knocked structures down or ruined them with water, it was somebody else’s problem.
In 2025, NFIP was $20,000,000,000.00 (that’s billion) in debt and working with Congress for another taxpayer-funded bailout. In the past, Congress relieved NFIP of similar inevitable debt because the low premiums paid by the insured did not cover the damage caused by storms. There have been modifications to NFIP, such as the opaque 2023 reform Risk Rating 2.0 — it’s FEMA’s own secret of how the rates for Risk Rating 2.0 are set, which increases premiums on a relatively few very high-risk structures. The reform has not solved the insolvency issue.
In short, the insolvent NFIP distributes wealth from areas less prone to floods to those having a greater propensity for floods. NFIP makes a specific type of lifestyle possible, a lifestyle for the well-heeled and situated along scenic coastlines, the epitome of what Gilbert White warned against. In these communities, very costly water damage is inevitable when storms brew in the Atlantic or Gulf and make landfall. Repetitive loss claims due to hurricane damage are not infrequent.
I once lived on a sandbar referred to as North Topsail Beach, North Carolina. In the ’80s, after a bridge spanning the intercoastal seaway was built, a community popped up where there had never been one before. It was made possible by NFIP — nobody in their right mind would build there without insurance. In the late ’90s, two minor storms, Category 2 or 3, hit the island; I watched wind knock down buildings and piers, but flooding caused most damage. Through NFIP, American taxpayers across the country footed recovery bills. This was not the intent of NFIP when it originated.
As “the Pope of FEMA,” a sobriquet I was tagged with during my tenure at the agency, I chaired several complex problem-solving sessions at the agency. In one of them, I asked, what is the root cause of NFIP’s insolvency? With the participation of senior people at FEMA overseeing and interacting with NFIP for years, we concluded: The unintended consequence of establishing NFIP separated the financial risk of flooding from those responsible for land use choices.
In other words, the people receiving help from NFIP were not the people paying for it; the cost is spread-loaded, and all American taxpayers are paying for coastal community living, not just those living there. Gilbert was correct. NFIP encouraged floodplain encroachment, and the burden to pay was transferred. Indeed, NFIP has never been applied expertly at all. We discovered Gilbert’s quote after we came to our conclusion.
The course of action we recommended to DHS to address the insolvency of NFIP was threefold: (1) Those at most risk pay premiums equal to that risk; (2) Garner and apply updated flood mapping; and (3) Scrutinize taxpayer dollars spent on mitigating flood risk. That is not good news for those living in high-risk areas. High premiums are the answer to living in a high-risk floodplain and coastal communities. This is commonly referred to in English as fair.
Inherent to the recommendation is the admission by the most senior people at FEMA in charge of NFIP that Risk Rating 2.0 can’t rescue NFIP from insolvency; NFIP will remain insolvent and continue to incur debt.
TRUMP IS HOLDING DISASTER AID HOSTAGE. HE KNOWS HE’S ON THIN ICE
In its report, the presidentially chartered FEMA Review Council recognized the need to reform NFIP. It won’t happen. Why? One, the FEMA Review Council and its recommendations are no match for confusion and entrenched federal bureaucrats at FEMA. FEMA folk can read what to do, but they can’t figure out how to get it done. It’s too complicated for them. Then, up the street from the FEMA building that houses 6,000 or so FEMA HQ personnel, there are those in Congress who simply want to revert to the original Risk Rating because their constituents living the coastal lifestyle don’t like the minor 2023 reform that is gradually increasing a small number of premiums.
And, finally, at DHS, there are no leaders with the intestinal fortitude and the know-how to implement the Council’s Recommendations on NFIP or any other of the 10 or so Council recommendations for that matter. Minor changes will likely be made and recorded in a lengthy ChatGPT-crafted, jargon-ridden memo and then hailed as evidence of reform, but NFIP will remain an insolvent program of big government wealth redistribution — money going from the not-so-well-heeled to the well-heeled.
David Richardson served as the Senior Official Performing the Duties of Administrator of the Federal Emergency Management Agency (FEMA). He is the author of Texas Flood: Power, Money, Politics, History, Bureaucracy and Tragedy.