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Woolsey Fire, November 2018. Photo: Robyn Beck/AFP/Getty
For Californians — many of them inured to routine annual fires, mudslides and earthquakes — a key question is not whether to rebuild when catastrophe strikes yet again. It's whether they can afford it.
Kaveh Waddell and I looked at the rebuilding phenomenon: Since the middle of the last century, fire has destroyed an average of 500 homes a year in California, according to the Western Ecological Research Center.
But the level of danger may be growing too high: Insurance losses from California fires last year were about $12.5 billion and this year could be about $6.8 billion, reports Don Jergler of Insurance Journal. After this season, insurers could decide to stop issuing fire insurance in high-risk zones "because they are contributing to people building where they shouldn't at all," says Dante Disparte, founder of Risk Cooperative, a DC brokerage that provides insurance to insurance companies.
Christopher Thornberg, a professor at UC Riverside and founder of Beacon Economics, said people should be free to live where they want — as long as they are covering the full cost and not relying on government services to bail them out in a catastrophe. "Raise people's insurance costs to cover the real threat and let them make the decision where they want to live," Thornberg tells Axios.
Consider two of the recent California fires:
Despite the danger, demonstrated again and again, many in California's wine country, where fire swept through in the summer of 2017, have chosen to stay.
"A community is people. It's not buildings, it's not sewer pipes, it's not infrastructure, it's not a town hall, it's not a school. That's why they're rebuilding: They want to remain intact as a part of this community."— John Allen
A lower-income city than Santa Rosa, Redding has not seen nearly the same vigorous rebuilding effort since fire burned 1,079 homes last July, and produced only the second-known large fire tornado in history.
More than a thousand homes are still on the market, said Garbutt, the Vista Real Estate broker. Among the unforeseen costs of remaining are obtaining permitting, hiring contractors and meeting new fire-safety codes. Insurance policies only cover the cost of rebuilding a burned-down home; they don’t cover upgrades to meet relatively new fire ordinances, like the use of non-combustible roofs and other materials.
But, but, but: Garbutt said some people are betting that building will return to Redding. One local developer, he said, for instance, is buying up lots to hold for future construction.
Go deeper: Americans are moving into fire zones
In a potentially significant political trend, almost half of 6- to 21-year-olds in the U.S. are Hispanic, African-American or Asian, according to a study released today by Pew Research.
Axios' Stef Kight writes: Rapidly changing American demographics will have a profound impact on elections, government policies, economic opportunity, and more. "How we deal with this racially diverse generation ... will say a lot about how successful we will be as a nation," says Brookings' William Frey, author of "Diversity Explosion."
The political impact of changing U.S. demographics can already be seen in the high turnout of young Americans in the midterm elections, Frey tells Axios — an estimated 31% of people 18 to 29 voted, the highest since 1994.
The youngest generation is also the most highly educated, with 59% of 18- to 20- year-olds enrolled in college, compared with 53% of millennials when they were the same age.
Photo: Jeffrey Greenberg/UIG/Getty
In May, Walmart put the kibosh on cashierless shopping — it said that its customers aren't so interested in possibly faster checkout without human help. But tomorrow, it's trying again.
Axios' Erica Pandey writes: In Dallas, Walmart's Sam’s Club will launch "Now," a cashierless store half the size of a normal Sam’s Club. It will be a testing ground that will include augmented reality and mobile checkout.
The opening comes 10 months after Amazon opened Go, a cashierless store in Seattle, arguably setting Walmart behind the latest big trend in retail. But in a report today on its third-quarter earnings, Walmart reported a solid 43% jump in e-commerce sales, suggesting that the company may simply be following a differing path.
The future of pig organ donors (Tom Clynes - NYT Magazine)
Fires hit the stock market (Courtenay Brown - Axios)
Tencent: Pony Ma's annus horribilis (The Economist)
Facebook's paid campaign to discredit Soros (Sheera Frenkel, Nicholas Confessore, Cecilia Kang, Matthew Rosenberg, Jack Nicas - NYT)
Crypto-crash (David Meyer - Fortune)
Photo: Fox Photos/Getty
The Stone Age ended a long time ago, but Goldman Sachs hasn't forgotten. It's acquiring a Tokyo-based company that makes business cards, posters and other paper products from limestone.
TBM has been attempting to raise $27 million from investors, Bloomberg reports. The secret sauce — its limestone process requires no water, a big advantage over the usual method using trees.