One concern about climate change is that it may cause more natural disasters such as hurricanes, floods, droughts, and forest fires. People living along the East and Gulf coasts, major rivers, and in the West may face higher risks if pessimistic climate predictions come true. President Biden has proposed an array of new subsidies and regulations to address climate change, but big-government solutions to the problem are themselves very risky.

However, there is a way to reduce the risks of climate change that should be a no-brainer: governments should stop handing out anti-green subsidies. When it comes to flood risks, federal subsidies for flood insurance, flood control structures, beach replenishment, and disaster rebuilding have encouraged development in coastal areas and along flood-prone rivers. Since 1970, the number of Americans living in Special Flood Hazard Areas has increased from 10 million to more than 16 million, thanks partly to federal policies.

FEMA runs the National Flood Insurance Program, which has allowed people in flood-prone areas to buy insurance at artificially low rates. To reduce climate risks, the program should be privatized and insurance raised to market rates, as discussed here. That reform would be pro-market and pro-environment.

Despite all the concerns politicians express about climate change, many of them still support anti-green subsidies. The New York Times reports that Senate Majority Leader Chuck Schumer “is objecting to a plan that would raise costs for some of his constituents by bringing flood insurance rates in line with climate risks.” FEMA was set to impose new rates for coastal homeowners that “would more accurately reflect the risks they face. The change would very likely help reduce Americans’ vulnerability to floods and hurricanes by discouraging construction in high-risk areas.” Schumer is apparently worried that some homes on Long Island would face higher rates, including in “the Hamptons, which have some of the most expensive real estate in the country.”

Meanwhile, government water-supply subsidies have encouraged population growth and farming in areas prone to drought. And insurance and infrastructure subsidies have induced Californians to live in dangerous fire zones, which has exacerbated the damage caused by recent wildfires.

Anti-green subsidies are not just an American problem. A World Bank / United Nations study identified government-created distortions that raised climate risks in many countries. The report argued, “If property values reflect hazard risks correctly, people can make informed choices based on prices that guide their decisions on where to live and what prevention measures to undertake. … where markets function, prices tend to reflect hazard risk.”

Rather than layering on new environmental subsidies and regulations, the Biden administration should work to repeal all the anti-green policies that the government itself is imposing.

For more on these themes, see here, here, here, here, here, here, here, here, and here.