My friend Richard Rider emailed me a great story about a city council that thought it could solve a “market failure” with a government enterprise, and now their reaping the whirlwind. Or rather the residents and taxpayers of the city are. I like Richard’s take on it. . . There are certain institutions all Americans tend to hate. Perhaps at the top of the list is the insurance industry. After all, they keep raising premiums, so surely they are making unfair (unconscionable, windfall, excessive, monopoly — you pick the adjective that you prefer) profits. I’ve always told the insurance industry critics that, if you think the companies are making too much profit, buy their stocks! Get a piece of the action. Of course, most people would not consider making significant investments in this risky industry, except perhaps in life insurance companies where the risk is well defined. Another option I suggest is to form one’s OWN insurance company. Let the socialist Hollywood elite form their “Feel Good” company, promising lower premiums while these “progressive” investors still reap (somewhat reduced) windfall profits. So far, no takers. Well, that’s not quite true. In 1991, two idiots on the Gardena [CA] city council talked the city into forming its own liability insurance company, funded with taxpayer money, and selling such insurance to other municipalities. Like all government ventures into the insurance business (flood insurance, crop insurance, pension insurance, etc.), this communal experience is ending disastrously. The city of Gardena is facing bankruptcy, and, at the very least, will suffer many years of reduced city services.