Obama Camp Release on McCain's Opposition to National Catastrophic Insurance Fund

As John McCain visits Florida today, the Obama campaign released the following statement on McCain's opposition to a National Catastrophic Insurance Fund:

“Once again John McCain has made clear that he is much more interested in standing with George Bush than getting the facts right or doing what's right. But what John McCain doesn't understand is that by choosing to stand with George Bush's failed policies instead of standing with the families of Florida he can't deliver the change the country needs and deserves,” said Obama spokesman Hari Sevugan.

While Governor Crist was under the impression in 2007 that McCain supported the idea, after the Bush Administration came out against a National Catastrophic Insurance Fund, McCain publicly hedged for months and eventually opposed the proposal. In defending his opposition to the plan, McCain said he was “not in favor of spending $200 billion a year simply for the state of Florida.” As the Sun Sentinel noted, however, CBO estimates place the cost of the proposal at $25 million per year. Please find more background on the issue below.

AFTER HEDGING, MCCAIN JOINED THE BUSH ADMINISTRATION IN OPPOSING A NATIONAL CATASTROPHIC INSURANCE FUND

March 2007: Crist Praised McCain for Supporting a National Catastrophic Fund for Disasters. “McCain campaigned with Crist during his run for governor last fall, as did Giuliani and former Massachusetts Gov. Mitt Romney, and on Tuesday Crist praised McCain for his support of Florida issues such as a national catastrophic fund for disasters and a continued oil drilling ban off of Florida's coasts.” [Palm Beach Post, 3/28/07]

April 2007: Bush Administration Noted Opposition to a National Catastrophic Insurance Fund. The Tampa Tribune reported in April 2007 that the Bush administration opposed the creation of a national catastrophic insurance fund: “The Bush administration said Wednesday it opposes a national catastrophic insurance fund, even as Gov. Charlie Crist and Florida's two U.S. senators urged a congressional panel to help create one. … But Edward Lazear, chairman of the White House's Council of Economic Advisers, testified that the Bush administration thinks catastrophic risk insurance at the federal level, ‘although well intentioned, would have significant adverse consequences on the economy, and would be unfair.'” The Tribune's editorial board later wrote that “the administration's uncompromising opposition is disappointing. The creation of an emergency fund deserves a hearing in Congress, and the president need not get in the way.” [Tampa Tribune, 4/12/07; “President Should Stay Out Of Fight To Create Federal Disaster Fund,” Editorial, Tampa Tribune, 4/14/07; Testimony of Edward P. Lazear, Chairman, Council of Economic Advisers Before the Senate Committee on Banking, Housing, and Urban Affairs, 4/11/07, http://www.whitehouse.gov/cea/lazear20070411.pdf]

September 2007: McCain Appeared to be Uncommitted to a National Catastrophic Fund. “For most of the presidential contenders courting votes in Florida, it's a no-brainer: Declare full support - heck, even vague interest works - in creating a national catastrophe fund to alleviate Florida's property insurance crisis by spreading the risk to taxpayers across the country. … And McCain? ‘If people are going to build homes where hurricanes hit, they have to assume a great part of that liability. We don't have that many hurricanes that hit Arizona, as you know,' he declared in a Political Connections interview airing today on Bay News 9. ‘We need to all work together and see if the present unacceptable situation can be remedied, and if that requires some federal action, I'm for it - but not just insuring anybody for any circumstance. I'm not going to do that. I would not support such a thing.'” [Adam C. Smith, St. Petersburg Times, 9/2/07]

January 2008: McCain Said “I Do Not Support a National Catastrophic Insurance Policy.” As the Miami Herald's political blog noted in January 2008, McCain is “not taking up Crist's call for a national catastrophic insurance fund. McCain seemed to suggest that the government needs to improve the Federal Emergency Management Agency instead. ‘I do not support a national catastrophic insurance policy,' McCain said in Coral Gables. ‘That insurance policy is there and it's called FEMA and it's called national disaster preparedness...I still do not have confidence that FEMA is capable of handling those responsibilities.'” ["Naked Politics" blog, Miami Herald, 1/21/08, http://miamiherald.typepad.com/nakedpolitics/2008/01/so-much-for-cri.html]

January 2008: McCain Citied Incorrect Cost Estimate as a Central Reason for His Opposition to a National Catastrophic Insurance Fund; Said He was “Not In Favor of Spending $200 Billion a Year Simply for the State of Florida.” Campaigning in Florida in January 2008, McCain reiterated his opposition to a national catastrophic insurance fund, saying that one of his central objections to fund was its cost. McCain said that he was “not in favor of spending $200 billion a year simply for the state of Florida.” However, as the South Florida Sun Sentinel noted, “[t]he Congressional Budget Office estimated the cost at $25 million per year, nothing close to the billions McCain suggested.” [South Florida Sun-Sentinel (Fort Lauderdale), 1/23/08]

February 2008: McCain Highlighted His Opposition To A National Catastrophic Insurance Fund in a Speech to Conservative Activists. In a February 2008 speech to the Conservative Political Action Conference, McCain highlighted his opposition to the national catastrophic insurance fund, stating, “I campaigned in Florida against the national catastrophic insurance fund bill that passed the House of Representatives.” [John McCain, Remarks at the Conservative Political Action Conference, Federal News Service, 2/7/08]

CRIST HAS FOUGHT FOR A NATIONAL CATASTROPHIC INSURANCE FUND

Crist: A National Catastrophic Insurance Fund Would “Provide Protection for American Homeowners.” In April 2007, Gov. Charlie Crist testified before the U.S. Senate Banking Committee where he called for the creation of a national catastrophic insurance fund: “The work of the Florida State Legislature has begun to address the insurance crisis in our state, but federal action is also necessary. I implore Congress to take the next step to ensure the affordability and availability of property insurance. … A federal catastrophe fund would provide protection for American homeowners throughout the nation. A national program would spread the risk across the country, thus strengthening our insurance markets. Capital for the plan could come from a portion of the property insurance premiums already collected by insurance companies. The funds could grow tax-free, provide the financial capability to cope with the catastrophic risk and allow affected regions the ability to recover more quickly from natural disasters. This federal backstop for insurers is an essential step to addressing the insurance crisis.” [Testimony of Charlie Crist, Governor of Florida, before Senate Committee on Banking, Housing and Urban Affairs, 4/11/07, http://banking.senate.gov/public/_files/crist.pdf]

Tampa Tribune Headline: “Crist Leads Push For U.S. Disaster Fund.” “The Bush administration said Wednesday it opposes a national catastrophic insurance fund, even as Gov. Charlie Crist and Florida's two U.S. senators urged a congressional panel to help create one. ‘We have a national defense in this country to protect us from foreign invasion. That makes sense,' said Republican Crist, pressing his case before the Senate Committee on Banking, Housing and Urban Development. ‘Wouldn't it make just as much sense to have a fund to protect us from natural disaster?' Crist said. ‘Don't we have a duty to protect our people, whether it's from a foreign invasion or from a natural catastrophe?' But Edward Lazear, chairman of the White House's Council of Economic Advisers, testified that the Bush administration thinks catastrophic risk insurance at the federal level, ‘although well intentioned, would have significant adverse consequences on the economy, and would be unfair.'” [“Crist Leads Push For U.S. Disaster Fund,” Tampa Tribune, 4/12/07]