Our government absolutely has to step up to the plate and help the Gulf Coast rebuild. However, I somehow get the feeling that this whole thing is being set up as a no questions asked "spend as much money as we need" to fix it program.
Today I ran across this article from the Wall Street Journal (paid subscription required).
When President Bush announced last Thursday that the feds would take a lead role in the reconstruction of New Orleans, he in effect established a new $200 billion federal line of credit. To put that $200 billion in perspective, we could give every one of the 500,000 families displaced by Katrina a check for $400,000, and they could each build a beach front home virtually anywhere in America.
This flood of money comes on the heels of a massive domestic spending build-up in progress well before Katrina traveled its ruinous path. Federal spending, not counting the war in Iraq, was growing by 7% this year, which came atop the 30% hike over Mr. Bush's first term. Republicans were already being ridiculed as the Grand Old Spending Party by taxpayer groups.
As much as I would like a beach house, I don't think I want the federal government to buy me or anyone else one. We have to help the victims of the hurricanes, but we have to do it in a way that won't bankrupt the country. In spite of owning the printing presses for money, there is a limit to how much we can spend before some serious dislocations start to take place. I'm not an economist but this kind of spending binge on top of tax cuts cannot be sustained.
David Brooks wrote the following in the NY Times on September 18.
On Thursday, President Bush went to New Orleans and gave the second most important domestic policy speech of his life. Politically it was a masterpiece, proof that if the president levels with the American people and admits mistakes, it pays off.
But in policy terms, the speech pushed the journey toward Bushian conservatism into high gear. The Gulf Coast will be a laboratory for the Bushian vision of energetic but not domineering government.
I've already penned a couple of posts in response to David Brooks. They're at my Justmypolitics blog.
Somehow when the top procurement official in the White House, David H. Safavian, has just been arrested according to the Washington Post, I'm a little leery of the oversight on the spending of $200B. We can't exactly trust Congress to not waste money these days after their less than sterling effort on the transportation bill, "Road Bill Reflects The Power Of Pork."
After all there have been more than a few questions about the spending on the war in Iraq and the number of bids awarded without competition.
Of course that's not holding up things in Washington. An article in the Houston paper states "Auditors investigate Katrina contracts." Even CNN has an article, "Firms with White House ties get Katrina contracts."
I was pretty suspicious when I got up this morning. Reading Doonesbury (September 26) confirmed it. I read that Duke was pulling up stakes in Iraq and following Halliburton to New Orleans. Duke always has a nose for easy money.
Hopefully we can get the Gulf Coast rebuilt without our country going broke or Duke getting too rich.