Just in time for the 12th anniversary of the Sept. 11 terrorist attacks, our friends at the Cato Institute have published an interesting new report that calls for letting the Terrorism Risk Insurance Program – the $100 billion federal backstop set up in the wake of the attacks –to expire when it comes up for renewal at the end of 2014.
That Cato wants TRIP to expire isn't the interesting part. Cato opposed its creation, and opposed both of its extensions, in 2005 and 2007. As "minarchist" libertarians, Cato is ideologically opposed to nearly any government program one could imagine. At the other end of the spectrum, most of the property/casualty insurance industry – primary insurers and reinsurers, agents and brokers, and many large commercial insureds – is firmly committed to extending the existing program in its existing structure.
Rather, what's interesting from our perspective, is what each side gets right and wrong about the issue, and parsing those arguments to find a middle-ground that both better protects taxpayers while also preserving a functioning market.
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