Steven E. Landsburg asks, Hurricane Relief? Or a $200,000 Check?:
Before we spend $200 billion on New Orleans disaster relief, can we just pause for about three seconds, please? That should be long enough to divide one number by another. The numbers I have in mind are, on the one hand, $200 billion, and, on the other hand, 1 million people — the prestorm population of the New Orleans area, broadly defined.Two-hundred billion divided by 1 million is 200,000. For the cost of reconstructing New Orleans, the government could simply give $200,000 to every resident of the region — that’s $800,000 for a family of four. Given a choice, which do you think the people down there would prefer?
I’m guessing most of them would take the cash. I can’t prove that, but I think I can make it plausible: If your city were demolished, would you prefer to have it rebuilt — with someone else making all the decisions about how it gets rebuilt — or would you prefer to collect $800,000 in cash and move your family elsewhere? I’ve asked a lot of people this question during the last week, and, according to my informal unscientific survey, pretty much everyone would take the money and run.
(Hat tip to Arnold Kling.)