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Thursday, June 15, 2006

Where is Katrina money going?

Newspapers and blogs (including progressive ones) are trumpeting the latest tale of FEMA mismanagement in the wake of Katrina, outlined in a recent GAO report and reported in this widely-circulated AP story:
The government doled out as much as $1.4 billion
in bogus assistance to victims of Hurricanes Katrina and Rita, getting
hoodwinked to pay for season football tickets, a tropical vacation and
even a divorce lawyer, congressional investigators have found.

The GAO concluded that as much as 16 percent of the billions of dollars in FEMA help to individuals after the two hurricanes was unwarranted.
Republicans are seizing on the report as evidence of the need to scale back Katrina aid and launch a massive investigation:
is an assault on the American taxpayer," said Rep. Michael McCaul,
R-Texas, chairman of the subcommittee that will conduct the hearing.
"Prosecutors from the federal level down should be looking at
prosecuting these crimes and putting the criminals who committed them
in jail for a long time."
While stories of FEMA
incompetence are no surprise, one should ask the question: are wrongful
payments to Katrina victims really bankrupting the American people?

Dig down into the story, and starting at paragraph 11 one finds some actual numbers which don't support the hype. In reality, only 1,500 cases of potential fraud have been confirmed to date, at a cost of $16.8 million -- a far cry from the "$1.4 billion" blasting across headlines today.

the new report is just a projected estimate, based on GAO's assumption
that it is "95 percent confident that improper and potentially
fraudulent payments" are higher than what is now confirmed. And their
projection doesn't give a firm number, just a range: "between $600 million and $1.4 billion" in wrongful outlays. Always beware of news headlines based around the phrase "as much as ..."

The GOP's outrage over possible
mis-spent money on Katrina survivors is especially disengenuous given
their nonchalance over hundreds of millions in no-bid Katrina contracts
known to have been awarded to Halliburton, Bechtel, Blackwater and other companies. FEMA promised to re-bid the contracts, but as we exposed at Gulf Coast Reconstruction Watch, they never did.

The hundreds of thousands of people displaced by Katrina need more
federal support, not less. The vast majority are still struggling to
make ends meet, endlessly bracing themselves for news that FEMA and
other agencies are ready to pull the plug on assistance for housing and
other needs. See, for example, this recent action alert from Color of Change:
month FEMA started denying long-term housing assistance to evacuees who
by its own standards should have been found eligible. After being
presented with evidence, FEMA acknowledged the problem but made no
guarantee that it would fix it, or that those unfairly denied would
have a chance to qualify for long-term assistance.

Please take a moment to email David Paulison, Director of FEMA, letting him know that this is unacceptable.
there's no doubt some have taken advantage of Katrina aid funds (and
FEMA's disarray). But how does that compare to the scandal of the
billions shoveled to politically-connected contractors and for unused
FEMA trailers -- 10,000 still sitting empty in Hope, Ark. -- while so little has been spent on rebuilding the Gulf coast and helping those genuinely in need?

And why are progressive websites playing along?
read the rest......
Katrina rip-off


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