I've seen precious little on this issue, other than some posts at Revkin's Dot Earth blog, such as the one above.
But it certainly appears that Texas' famously loose regulation of zoning and land use (which libertarians tend to celebrate, even if Houston seems to routinely score high on World's Ugliest Cities lists) is responsible for developers being free to build lots of homes on known dangerous flood plains.
It appears there have been plenty of warnings about it, all ignored.
Way to go, libertarians. Cheaper housing for everyone, just don't be in it when it rains heavy.
And by the way, the rain in two American States last month really was record breaking:
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