Cronyism in Overdrive - The Disaster Profiteers

First came the phone calls -- 6,300 by last Wednesday to the U.S. Army Corps of Engineers alone, from contractors offering "'cure-all' technologies and services" for the Gulf Coast reconstruction effort. Then came the cash: more than $500 million a day is being spent already, much of it on Iraq-style no-bid contracts, since normal federal contracting rules were "largely suspended" in the days following Katrina's landfall. The White House mindset, according to Time magazine: "Spend freely, and worry about the tab and the consequences later. 'Nothing can salve the wounds like money,'" one official said. It's the same mindset that has governed the reconstruction efforts in Iraq, which have lined the pockets of politically connected corporate interests while leaving Iraqis with an infrastructure less capable than it was under Saddam Hussein. "This is very painful," says Danielle Brian, director of the Project on Government Oversight, a nonprofit government spending watchdog group. "You are likely to see the equivalent of war profiteering -- disaster profiteering."

IN FEMA WE TRUST: FEMA proved itself largely incapable of carrying out its primary responsibility of emergency preparedness but was rewarded with a $50 billion windfall and vast new responsibilities. Congress last week passed a $51.8 billion Katrina aid package after just 40 minutes of debate, during which members were barred from proposing amendments. All but $2 billion was placed under the control of Mike Brown and his associates at FEMA. "As the title says, FEMA is an emergency management agency, not a reconstruction agency," Josh Marshall points out. "It doesn't have the organizational structure or competence to run the economy of a significant chunk of the United States for the foreseeable future, which is what this amounts to." But the funding would be questionable even if FEMA did have the organizational structure -- just last year, the agency was caught "giving out FEMA money as political pork with an eye to the 2004 elections."

Links and more at American Progress Report