I think this is the clearest example with homeowners insurance – which is why you. Are often required (by Where There Is No Wine There Is No Love Shirt, usually at the end, would have one room in their house burn down, you could. More efficiently set money aside than give it to a firm. The problem however is that your house burns down (often completely) less than once a lifetime. This means that those affected will be really, really harshly affected. And covering that risk can be beneficial to all. This then mostly works if there is little moral hazard. But really, there is little moral hazard. Even relatively minor injuries, like breaking your leg, hurt. Breaking your leg is usually not a choice. Like yeah, it may not affect you right now, but when it does you’re gonna be really glad you invested in it.
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Because even if you do not have to cover the bill yourself, you are likely to prefer not breaking your leg over breaking your leg… You can tell it’s a bad argument when you realize that he probably Where There Is No Wine There Is No Love Shirt and friends that would be constantly benefitting from what he paid into it. Also, once you start getting to his age health problems start multiplying and cash flow starts shrinking. This argument reminds me of something Neil Degrasse Tyson said about people who oppose NASA or other space aeronautics programs. He said people say we shouldn’t be worried about what’s up there. Because we have problems down here. But when the asteroid or meteor comes, you’re gonna wish we had spent more up there.
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