ADVERSE SELECTION

Any top executive an insurance company can tell you about adverse selection. That is when you attract the wrong customers. For example those insurance companies in California who offered more flexibility in writing homes in areas with a high wild-fire risk literally got burned. A lot of insurance carriers lost money in California. Those who were more competitive in places like Paradise suffered catastrophic losses. One even went insolvent. Other carriers, who were more selective, had much better results.

The insurance industry in California has figured this out. Today no standard admitted carrier will write any new homeowners’ insurance if your home is located anywhere near a wild-fire area. In addition, insurance carriers have greatly expanded what they consider to be high risk areas to make sure they don’t accidentally miss anyone.

This problem was easy to predict. One of my first assignments in the insurance industry was to underwrite homeowners’ policies in California. That was more than 40 years ago, and everyone already knew about the risk of wild-fires in California. Although our esteemed governor thinks this is a new development because of global warming (climate change) it actually isn’t new at all. We just have built a lot more homes in areas where wild-fires are not only possible, they are not only probable, in some cases they are inevitable. Now everyone is shocked to learn that what is was and will be obviously true is obviously true.  When you think about it, only a Democratic politician would be stupid enough to bitch about the weather in California.

Incredibly Democrats are doubling down on adverse selection. It started with the homeless population. California passed laws to make it easier to be homeless. Police can’t arrest you anymore. New taxes are designed to generate more revenue to provide additional services to the homeless. Nothing will change, except the number of homeless people. People all over the country are waking up and deciding that if they have ever considered trying for the coveted homeless lifestyle, now is the time and California is the place.

Los Angeles and San Francisco have already deteriorated to the point where the problems are drawing national attention. Nothing being proposed has any chance of even reducing the problem. Even diseases like the bubonic plague are showing up again.

So what could make this worse? Easy. In addition to encouraging homeless people, go all out to be more welcoming to illegal aliens. Explain that California is the place you want to be. We’ll even offer you free medical care. No one is illegal here.

The great migration is already underway. People with jobs, we call them taxpayers, are moving out of state. People here illegally and those who are homeless are already flooding in. The only person doing anything to stop the flood, Donald Trump, is being resisted at every opportunity.

Now Donald Trump just took steps to increase the pace on the road to destruction. Democrats were too stupid to realize what will happen. He announced plans to deport over one million people who are here illegally. Chuck Schumer says this is impossible. It would be if people like Schumer were in charge. But Trump doesn’t actually need to deport these people, he just needs to encourage them to move someplace else, like California.

ICE will deploy to locations where local law enforcement will actively cooperate. Illegal aliens will either get arrested or move. The MSM will help Trump in his mission by publicizing all these nasty arrests and deportations. Once again, Trump is getting free advertising from the MSM. Those here illegally who are not already in California are packing their bags. With each deployment by ICE, large sections of the country will be cleared of illegal aliens. They will flock to places like Sacramento, Los Angeles and San Francisco. They will also flock to states like New York, but in spite of the best efforts by people like Governor Cuomo, the weather still sucks. California will be the big winner of the illegal alien lottery.

Democratic politicians will respond by making things worse, much worse. They will raise taxes and use the money to fund free housing and free medical for the homeless. Then they will wonder why there are more homeless. They will block the police from arresting illegal aliens and then wonder why the crime rate is skyrocketing.

Those who already live here, who have jobs and who pay taxes will be punished. They will also be lectured by liberals and the Hollywood elite on the need to be more welcoming. Liberals will be shocked to discover that a lot of people are just leaving. They will be even more shocked when the outrage reaches the point where they are thrown out of office.

If you doubt that, start paying attention to Europe. All of those progressive politicians who embraced open borders and mass migration are being voted out of office. The same thing will happen here. It is not only possible, it is not only probable, it is inevitable. The homeless and the illegal aliens will not help Democrats win elections, because they don’t pay taxes and they don’t vote. Eventually the rest of the people, who do pay taxes, will revolt and vote the bums out of office.

Anyone who has studied the insurance industry knows all about adverse selection. This has happened many times before and the results have always been the same. California is using adverse selection to gain new residents. It is only a matter of time before they pay the price for that. The last people to figure this out will be Democrats. But eventually, even they won’t be able to tolerate the stench.

TDM

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