The free market is occasionally plagued by a phenomenon known as market failure, where the market degrades and no longer operates efficiently. One of the best established examples of market failure are "public goods." Public goods are non-excludable, which means that once the product is produced it is impossible to prevent people from consuming it. They are also non-rival, which means that many people can consume product without diminishing its usefulness to others. What this means in the free market is that "lacking control over use and redistribution of the good, private firms will choose not to produce it" (Henstra, 3). Disaster mitigation is a textbook example of a public good, and thus the government's responsibility.
             Disaster mitigation involves five main components: hazard assessment and monitoring; planning; prediction and warning systems; public education and research; and relief. The government has the lead role in perhaps all of these components. Which level of government is involved depends on the particular scenario considered and on the depth and breadth of the disaster. For a flood which affects one township, for example, the county government or the state government would take the lead. For a catastrophic event, such as Hurricane Katrina, the federal government must take the lead because the level of devastation is too large for the local governments to handle. Private actors are mostly involved tangentially. Governments may contract out aspects of the disaster mitigation plan, such as a hazard assessment, but it is the government that is in charge of the overall plan. Where private firms are most involved is in the relief aspect of a disaster mitigation plan, typically through the purveyance of insurance. However, almost all insurance policies have an "act of god" disclaimer-and it should be noted that this disclaimer is a tacit admission that disaster mitigation is,...