Thinking it over, I think Edge made an interesting, albiet unintentional, pt about this thread. And it really is an interesting thread that goes to the heart of the differences in political philosophy of liberalism and conservatism going back to JFK and Goldwater.
The govt requires lenders to only lend on mortgages in flood zones if the mortgagee also buys flood insurance. The mandate is on the lender, not the mortgagee. Moreover, a person can buy a home in flood zone with private money and no mortgage and no flood insurance. The govt's interest is not in protecting homes from floods, but rather in protecting investors who purchase the mortgages as mortgage backed securities in the form of qualifided debt obligations. And those QDOs were what led to the credit meltdown. Not because of a lack of flood insurance on flood zone mortgages, but rather mortgages that were more about having a mortgage to sell than lending money that would likely be paid back to whomever ended up owning the mortgagor's right to payment. There's never been a question that the govt has the power to regulate banking (commerce).
But what's interesting for OP purposes is the effect, or lack of effect, on homeowners. Think back at how often the govt has bowed to political pressure, from senators and congressmen from states that suffer some awful flooding, to allow uninsured homeowners to sort of retroactively buy into flood insurance. The effect of that is you and I, the general tax payers, end up subsidizing illogical, poor decsion makers ... or cheapskates. Flood insurance premiums cannot cover this retroactive insurance, so we use deficit dollars to do it. That ain't no way to run an insurance program. But then, the people really being insured were the owners of the mortgages.
Compare that to medicare. There's no individual mandate with medicare, yet there's near universal coverage. And that's because seniors know sooner or later they gotta enroll, and there's penalty for not doing so when they are first eligilbe.
Part A late enrollment penalty | Medicare.gov
So, oddly, the first situation has a mandate that doesn't really fully protect homeowners, and the second situation does not have a mandate, yet still nearly everyone enrolls.
Interesting thead. Thanks again.
