With the one-year anniversary of Katrina approaching, the White House knew it’s due for another chroncling of how it is failing the displaced victims.
So it dispatched Don Powell, the Federal Coordinator of Gulf Coast Rebuilding to ABC’s This Week and Fox News Sunday to spin hard and shift blame.
In particular, Powell knew he was going to get hit for the slow pace of aid: despite Congress having appropriated $110 billion, only $44 billion has actually been spent.
So he peddled this dishonest talking point about the status of the relief funds:
It’s not unlike your checking account. When your wages are deposited into your checking account, the money is there. The 110 billion dollars is there.
And you draw down on that checking account as you receive bills.
Of course, it’s not like a checking account at all.
If it’s in your checking account, then you have direct access to it, and you can get to work on rebuilding your life.
In reality, most people in need don’t have direct access to anything.
The money is not in their checking accounts. It’s bottled up in bad bureaucracy. They can’t rebuild until the money is actually distributed.
The Los Angeles Times has the gruesome details:
Some federal agencies acted quickly … Flood insurance payments moved early and efficiently … But other agencies proved inflexible and overwhelmed, making little effort to clear bureaucratic obstructions and releasing available aid at a trickle.
In July, Congress’ nonpartisan Government Accountability Office reported that disbursement of Small Business Administration recovery loans was marred by “significant delays.”
A report last week from Democrats on the House Small Business Committee said that of $10 billion approved for such loans, just 20% had reached recipients…
…The telltale effects of the unspent billions emerge in the bitter accounts of homeowners who have waited for months for trailers that have not arrived, merchants who agonize over government loans still pending, town officials frustrated by rebuilding efforts stalled by the vagaries of federal regulations…
…At times, FEMA’s slowness to provide funds has paralyzed state agencies required under federal law to match 10% of the cost of repair work, said [Brookings Institution’s] Amy Liu…”FEMA provided the most cumbersome, reflexively slow response we’ve ever seen when it comes to disaster assistance,” said Liu…
…When the Office of Management and Budget released its spending overview last week [it] showed that HUD had spent only $100 million of its overall $17.1 billion congressional allocation.
The failure to start a full-scale housing reconstruction program until nearly a year after Katrina, critics contend, left thousands of storm and flood victims in the lurch.
Also on This Week, Dem Senator Mary Landrieu lamented about the slow aid, saying that “the mechanisms that we have in Washington to receive that money and distribute it don’t work.”
George Stephanopoulos jumped in and suggested that fraud was the problem, that $2B of FEMA money has been lost to fraud.
Interestingly, Landrieu retorted “that’s the little fraud” done by individuals. She continued:
I’m talking about the big fraud … the money that came down to contracts for everything — from debris removal to blue tarps to the trailers — basically 30 to 40 percent never reached anybody because it went to the contractors for profits.
Stephanopoulos didn’t pick up on what she was talking about and moved on to another topic.
But New Orleans law prof Bill Quigley, in the latest Louisiana Weekly, expounds on what the Senator was referring to — the “disaster profiteers”:
Congress and the national media have so far been frustrated in their quest to get real answers to where the millions and billions went.
How much was actually spent on FEMA trailers? How much did the big contractors take off the top and then subcontract out the work? Who were the subcontractors for the multi-million dollar debris removal and reconstruction contracts?
As Corpwatch says in their recent report[:]
“Many of the same ‘disaster profiteers’ and government agencies that mishandled the reconstruction of Afghanistan and Iraq are responsible for the failure of ‘reconstruction’ of the Gulf Coast region. The Army Corps, Bechtel and Halliburton are using the very same ‘contract vehicles’ in the Gulf Coast as they did in Afghanistan and Iraq. These are ‘indefinite delivery, indefinite quantity’ open-ended ‘contingency’ contracts that are being abused by the contractors on the Gulf Coast to squeeze out local companies. These are also ‘cost-plus’ contracts that allow them to collect a profit on everything they spend, which is an incentive to overspend.”…
Senator Byron Dorgan of North Dakota has raised many protests and questions over inflated prices. “It is hard to overstate the incompetence involved in all of these contracts – we have repeatedly asked them for information and you get nothing.”…
…There are many other examples of fraud, waste and patronage.
How did a company that did not own a truck get a contract for debris removal worth hundreds of millions of dollars?…
…How did a company that filed for bankruptcy the year before and was not licensed to build trailers get a $200 million contract for trailers?
(By the way, if there’s one piece you need to read to fully understand what is happening in New Orleans, it’s Quigley’s: Trying to Make It Home: New Orleans One Year After Katrina.)
The White House’s credibility is shot in general. It’s especially shot when it comes to Katrina.
Sunday’s spinfest, once again juxtaposed with stark scenes of failure, will do nothing to salvage that deserved reputation.