DNC - Senator McCain Watch: McCain Brags About Opposition to Catastrophic Insurance Fund

Against Advice of Supporter Governor Crist, McCain Backs Bush in Opposing CAT Fund


Washington, DC -
Today, John McCain will visit Florida, where he will face Floridians - as well as one notable supporter, Governor Charlie Crist -- over his opposition to a national catastrophic insurance fund, which would provide economic relief for Americans struggling with rising insurance costs by creating a national pool for disaster insurance. McCain has changed his position on the national catastrophic insurance fund multiple times, reversing himself twice - he was against it, then for it, then against it again - and now has established himself as a proud opponent, in line with President Bush - while ignoring the advice of governor crist.

McCain is out of touch with Americans burdened by rising insurance costs and facing the economic aftermath of disasters. Senator McCain now brags about campaigning in Florida against the establishment of a national catastrophic insurance fund. McCain claims FEMA can handle disaster preparedness, making a national catastrophic insurance fund unnecessary. But FEMA has little or no effect on insurance costs.

Residents of Florida and many other states are deeply affected by natural disasters, struggling not only in the aftermath of tornados and hurricanes but from day to day under the burden of rising property insurance costs. Hurricanes in 2004 and 2005 in Florida caused some Floridians' property insurance rates to triple by 2007. Yet when discussing catastrophic insurance, McCain said, "If people are going to build homes where hurricanes hit, they have to assume a great part of that liability." He added helpfully, "We don't have that many hurricanes that hit Arizona."

Americans want - and need -- change, but McCain is offering more of the same failed Bush policies that have left residents of Florida and other at-risk states burdened by soaring insurance rates and struggling after natural disasters. 

Of course, McCain isn't the only one who will face tough questions about his opposition to the CAT fund during his trip -- Governor Crist will also have to answer questions about how he so strongly supports a candidate who stands in such strong opposition to a key state priority.  Crist is a strong supporter of the CAT fund, championing it consistently and even testifying before the US Senate Banking Committee, saying, "A federal catastrophe fund would provide protection for American homeowners throughout the nation" and stating that a CAT fund would strengthen insurance markets. 


MCCAIN'S REVERSALS ON A NATIONAL CATASTROPHIC INSURANCE FUND

First, He Implied He Had An Open Mind…

October 2007: Mac Is Back?  McCain Now Back on the Insurance Bandwagon?  Meeting with Gov. Charlie Crist in Florida, McCain "said he was interested in Crist's effort to create a national catastrophic-insurance fund to cope with major disasters like monster hurricanes or earthquakes." [The News-Press (Fort Myers, Florida), 10/2/07] 

Then, Crist Praised McCain For His Support Of The Fund…

March 2007: McCain On Board With Gov. Crist's Idea of National Catastrophic Insurance Fund.  In March 2007, Gov. Charlie Crist "praised McCain for his support of Florida issues such as a national catastrophic fund for disasters." [Palm Beach Post, 3/28/07]

But McCain Reversed Himself Again…

January 2008: McCain Refused To Support National Catastrophic Insurance Fund. In a speech in Coral Gables, Florida, McCain suggested that the government should do more to bolster FEMA and rejected the National Catastrophic Insurance Fund. McCain said, "I do not support a national catastrophic insurance policy… 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."  [Miami Herald, Naked Politics Blog, 1/21/08]

Now, He's Bragging About His Opposition.

February 2008: McCain Bragged About His Opposition To A National Catastrophic Insurance Fund. In his speech to CPAC, McCain highlighted his opposition to the national insurance fund, bragging, "I campaigned in Florida against the national catastrophic insurance fund bill that passed the House of Representatives..."  [John McCain CPAC Remarks As Prepared For Delivery, 2/7/08]


HIGHLIGHTS FROM MCAIN'S OPPOSITION TO A NATIONAL CATASTROPHIC INSURANCE FUND

McCain Says People Who Live "Where Hurricanes Hit" Should "Assume a Great Party of that Liability." As reported by the Tampa Tribune, "The Arizona senator has long opposed the creation of a national fund to help insurers cover catastrophic damage from natural disasters. "If people are going to build homes where hurricanes hit, they have to assume a great part of that liability," he once explained. "We don't have that many hurricanes that hit Arizona.'" [Tampa Tribune, 7/29/08]

McCain Opposes A National Catastrophic Insurance Fund, Even Though Some Of His Supporters Backed It. 
"McCain also faced criticism for opposing a national catastrophic insurance fund for hurricane-prone states.  Democrats noted that Crist, who gave McCain a critical boost by endorsing him just before the Florida primary last January, had lobbied congress for the fund.  His predecessor as governor, Jeb Bush, also backed the fun. … McCain has said he would instead bring industry and government together to protect homeowners.  His spokesman, Tucker Bounds, said Thursday that the government-run fund would ignore the need for reforms of the private insurance market to make sure everyone can get coverage."  [Miami Herald, 6/5/08]

McCain Withholds Backing For National Disaster Fund.  Concerning the proposed national disaster fund, McCain "is resisting calls to back the program.  'This is a very large federal program,' and the only state currently in a position to benefit is Florida, said Douglas Holtz-Eakin, Mr. McCain's policy director. … Mr. McCain, who opposed the federal catastrophe plan, received $690,000 from individuals in the insurance industry, $9,000 from Allstate employees and $21,000 from employees of State Farm."  [Associated Press Financial Wire, 6/2/08]

April 2007: Bush Administration Stated Opposition to 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]

CRIST CHAMPIONS NATIONAL CATASTROPHIC INSURANCE FUND

 Crist Cites Cat Fund as Way to Ensure "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: "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]

MCCAIN BRINGS MORE OF THE SAME FAILED BUSH-MCCAIN POLICIES TO FLORIDA

Unemployed Up 61%. The number of unemployed workers in Florida has increased by 61% under President Bush. The number of unemployed has gone up from 316,059 in January of 2001 and preliminary figures for June of 2008 are 507,582, an increase of 191,523 workers, or 61%. The unemployment rate similarly increased from 4% to 5.5%.  [Local Area Unemployed Statistics, (Seasonally Adjusted), Bureau of Labor Statistics, accessed 7/20/08, data.bls.gov]

Income Stagnant. 
Median household income in Florida only increased from $44,415 in 2000 to $45,038 in 2006, a difference of $623 per household. [Joint Economic Committee Fact Sheet, 8/29/07, (Bureau of the Census, U.S. Department of Commerce), jec.senate.gov]

Some Floridians' Property Insurance Rate Tripled from 2004 to 2007. As reported by the New York Times, "But while Mr. Crist, a Republican, and the Republican-dominated Legislature said last week that they were committed to significant across-the-board rate reductions, reality proved more complicated. South Floridians covered by the state-run insurer of last resort because private companies refuse to insure their homes will see the smallest savings -- as little as 8 percent. Their insurance costs have as much as tripled since 2004, forcing many people to consider leaving Florida." [New York Times, 1/27/07]