The Witness Chronicles July 19, 2023
The looming home insurance disaster in Florida, 97 degree ocean waters, and falling inflation
Two climate-related stories this week highlight the new reality gripping much of the world. One is a business story that could drastically impact housing markets in disaster-prone areas. The other is another record temp, but one that reverberates all over the country.
In the realm of more positive news, inflation has fallen from a high of 9% in 2021 to 3% now. It’s good news for the economy, but bad news for the Republicans who have focused on attacking Biden over inflation numbers, despite his having almost nothing to do with it. The wind just went out of that sail.
The Witness Chronicles showcases some of my opinion and observation writing from Medium.com. I feel a responsibility to serve as a witness to these changes and to call out the extensive misinformation the right is using to sow division when we desperately need to work together.
Be nice. I respect your right to disagree if you’re nice and back up your views with facts, not Fox News lies (we know they don’t even believe them). Why people trust this stuff is beyond me.
Florida Homeowners Are Waking Up
Many face ruin while their governor plays
Home insurance is taken for granted in this country. Banks require it before they will issue mortgages. In disaster-prone areas (there are many more of them these days, as much as one third of the country) insurance is the only protection for many against losing everything.
So this once simple protection, relatively inexpensive, serves a vital financial role in our society, literally enabling home ownership for many. But the insurance industry is waking up to the fact that climate-related weather is changing their risk calculations in drastic ways.
Managing risk is literally what the insurance business is all about. Their actuaries assess risk and make determinations of how much they can handle. If their estimates work out, the business can be profitable, if they don’t, there is no viable business.
In Florida and other vulnerable states, insurers are determining that they cannot be profitable anymore and they are pulling out or raising rates and deductibles, turning them into major expenses for many homeowners. There is also evidence that smaller regional insurers are refusing to pay out after events like Hurricane Ian, citing natural disaster, or ‘acts of God’, exceptions in the policies.
In the past week major insurers Farmer’s and AAA announced they are not issuing new policies in Florida and other states like California that are wracked by natural disasters like extreme weather, fires, floods, and water access issues. And homeowners are starting to realize the drastic impact of being unable to get home insurance.
In Florida the pullout of these major insurers is causing panic as people see the possibility of losing everything with no recourse if another major hurricane hits the state, a nearly inevitable event. It’s not just the ability to get a mortgage, it’s the ability to rebuild or be compensated for a potentially catastrophic loss.
In Florida the problem is made worse by a lack of leadership at the top of the government and denial of reality by those elected to serve the state. One major political figure described the reasons for the pullout as being ‘woke’, a meaningless statement not based in any reality. He is being ridiculed for echoing his Governor’s mantra against whatever wokeness is.
And that governor is not governing as he makes an increasingly pitiful run for his party’s nomination for President in 2024. He doesn’t seem to understand that this insurance issue can blow up in his face in a national election next year. It is already blowing up in his home state while he plays at being a national political figure.
DeSantis is not known for his empathy. He doesn’t appear to have any, making him another of the political type narcissists that seem to be appearing more and more in the Republican Party across the country, no doubt modeling themselves on former President Donald Trump, a textbook narcissist bordering on sociopath.
So we have an ideological collision in the making as supporters of these politicians see their politics run into their personal finances. Trying to reconcile losing your insurance with politicians who don’t seem to care is going to cause a rupture in the politics of places like Florida.
Right now the news of insurers pulling out of certain states doesn’t seem to be seen as a major news item, probably because for most, insurance is a necessary evil or simply a boring necessity.
Until you can’t get it. Then it becomes existential and the logical action would be to get out while you still can extract value from your home. That’s the kind of decision most middle class homeowners may face and it is a challenging one, requiring significant life changes, not always under circumstances you control.
There is no simple resolution to this. Climate change is real, it’s here and it is very serious. You can’t fault the insurers when they look at a market and determine it is not only no longer viable and could be catastrophic. These are for profit businesses not government services. They have a fiduciary responsibility to their shareholders to increase value.
The Florida situation is particularly bad because their leadership is focused on issues like censorship while serious problems on multiple fronts need their leadership. The Republican Party’s long time denial of climate issues, funded by the oil and gas lobby, has made the subject taboo, no matter what the reality.
Florida homeowners are between a rock and hard place and they are starting to understand the implications. If their political leaders don’t start acting, there will be an economic catastrophe in their state.
Meanwhile, the war on woke continues.
97 Degree Ocean Water? The New Reality
Florida has yet another climate change problem
One of the main draws to the Sunshine State is the glistening ocean waters just off its wide, sandy beaches. It’s hot down there but there is always the promise of a cooling swim. But that may be changing.
Actually, like almost every natural condition we take for granted, it has changed and the change is unprecedented. Current ocean surface temps in the Keys are hovering around the mid-nineties Fahrenheit, closer to bath water than a cooling dip.
That sucks if you need a swim to cool off but that’s not even close to the biggest problem with these astronomical temperature numbers. It increases the humidity of the atmosphere and, if you know Florida, it’s already too humid much of the year.
But the really big problem with record surface temperatures is they are fuel for increasingly violent and frequent storms including hurricanes and torrential rainfalls like those we have experienced in the northeast this week. Fronts pick up the saturated air and carry it with them.
When conditions are right, that suspended moisture condenses and we get rain, a lot of rain. And it can affect weather far from the shores of Florida. I live in Western NY and a few days ago a town just south of me got 5.5” of rain in two hours, causing flash floods.
That same storm moved on to dump as many as twelve inches into one Hudson Valley town then moved on to do the same in Vermont where it is still coming down.
These are what are known as thousand year events because they are so rare they are only experienced once every thousand years on average.
Not the case any more.
Is it a stretch to blame hot water in the Gulf of Mexico for rain thousands of miles north? Not at all. It is weather 101. The Gulf provides the fuel for extreme weather all over the Eastern United States, not just Florida and the Deep South.
So, this isn’t just Florida’s problem and it goes far beyond taking away our ability to cool down with a quick dip. When you combine that moisture bomb with flow patterns high in the atmosphere you create the eastern version of those atmospheric rivers we read about on the west coast.
You know, the ones that brought a huge lost lake back to life in central California and created so much snow pack that people are skiing in shorts in Tahoe in July.
The point of all this is that water surface temps are not just weird news about a place far away. This is a story of a closed system, the terrarium we call planet earth and we all live in it.
But if you live in a place like Florida you’re probably watching the tv weather a lot more often than you used to because weather might mean your life being upended and losing everything.
It is a peculiarity that there are humans who choose to live in hostile environments and learn to love them. A drive through the Mojave desert, maybe on your way to Vegas, will reveal small towns in the hottest, driest places on the planet.
There are a lot of Americans who are opting for a fantasy life based on what a place used to be like. Maybe it’s the high Arizona desert or a home on the Gulf in Naples. It’s the pursuit of the American Dream to build a life in these places, which can be amazingly beautiful much of the time.
Unless a hurricane is coming your way and your home insurer has decided your dream home is too risky to protect financially. Or the suburban new house you bought in Phoenix no longer has access to public water because there isn’t any.
When I read a headline or see a news story that is about hitting yet another milestone in extreme weather, my mind goes down these paths. What would 97 degree waters in Florida mean for me in Western New York? How soon will they change things?
The answer is they already have.
The Inflation Boogeyman is Fading Away
That’s bad news for right wing politicians, but not the rest of us
Some really good numbers came out yesterday, major indicators are that the economy is chilling, though the job markets are still very strong. You’re going to hear a lot of BS on Fox about this because it shows yet another lie they’ve gone into full bore on is bullshit.
The mantra has been Biden= inflation, ad nauseum, but it is simply not true. The numbers don’t lie, no matter how the right will try to prove they do, and that this is a vast conspiracy of something or other.
The problem is these numbers come from both public and private sector economists and our banking system and businesses make decisions based on them, not on hysteria from a Republican Party that just had the floor pulled out from under their only real political issue.
Like a lot of their issues, it doesn’t hold up to scrutiny and the light of day.
Yes, I know prices are still high and things like gas are still very expensive. But before you start complaining that inflation is not going down in your life, understand something basic about these numbers: they are leading indicators, new data that companies will use to price their products competitively in the near future.
People cut back on a lot of discretionary spending because prices were pinching our pocketbooks. And that created a glut of unsold products that will be discounted to clear out inventories. That’s one way prices come down.
Prices on highly inflated products like used cars have gone down by five per cent and lots are full now that Covid-related supply chain issues have lessened.
Gas and fuel costs are an issue on their own because of the Ukraine War which has taken a lot of cheap Russian oil and gas off western markets. And OPEC and the big oil companies who have artificially limited supply to create historic profits quarter after quarter, profits that come directly from all of our pockets.
It’s called price gouging and it has been blatant. But inflation has been real. A year ago it was around 9% which means that everything cost more and we all saw it. But today it is around 3%, a massive improvement.
Besides gas, the price of eggs, a commodity, was the most obvious shocker for consumers. But that was not just inflation. Bird flu meant that the poultry industry had to destroy a huge percentage of their hens and it takes time to grow new ones. Egg prices have been creeping down and they may fall quickly as those new hens start laying.
It’s the politics of these numbers that will further divide the country. The right has been using inflation as proof of all kinds of things from Joe Biden’s competency to that vast conspiracy thing I mentioned earlier. They just lost their biggest scary boogeyman and they don’t have much left beyond Biden’s age.
A reminder, their guy is no spring chicken and lives a lifestyle that can charitably be called very unhealthy.
The interesting thing about inflation as a political bludgeon is that it is cyclical. What goes up must come down. And it has been the number one issue determining re-election of Presidents, historically.
Historically. But the arc of history has changed with the pandemic and the politics of division far beyond anything seen in recent decades. Respect and decency, once required of politicians, seem to no longer be important to politicians who would rather scream bloody murder over imagined things than actually govern.
Here’s a good roundup of the new numbers and how they will affect all of us:
Inflation drops to lowest levels since March 2021 as economy cools
Even if the numbers bewilder you, give it a read. It’s very good news, though not for the Republican political machine.
When I write on these topics I try to avoid projecting a doom and gloom attitude because I don’t feel it. But there’s no doubt the future is going to be very different in ways we cannot fathom. I think the insurance story is an example of how a seemingly mundane business story could mean life changes for many people.
Thematically, the pattern is how changes in one region can affect far distant parts of the country and the world, demonstrating that our planet is a closed system and everything is completely interrelated. It’s a lesson our politicians on both sides need to grasp, though ideas are not their forte.
I hope you’re able to stay cool and safe.
Did you write today?
Martin Edic (Martin is my first name, some commenters seem to think it is Edic which they may be reading as Eric. Not a new thing for me.)
2481 words
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