The news about the Federal Emergency Management Agency’s response to last year’s Hurricane Katrina just keeps getting more and more shocking. As Maine Republican Sen. Susan Collins put it, “The blatant fraud, the audacity of the schemes, the scale of the waste — it is just breathtaking.”
A survey by the New York Times of audits, congressional investigations and prosecutions filed suggests that at least $2 billion of the $29 billion in taxpayers’ money FEMA has spent went to fraud or waste.
Washington officials told the Times that fraud associated with disaster relief is usually in the range of 1 percent to 3 percent. If $2 billion was wasted on Katrina and Rita — you can be sure the figure will rise as more investigation is done — that’s 11 percent of the $29 billion FEMA has spent.
In May, the Government Accountability Office reported that as much as 21 percent of the $6.3 billion given directly to hurricane victims was delivered improperly, most often to people scamming the system.
Perhaps it’s not all that surprising. Within hours of the levees breaking, FEMA and the administration were being criticized for their slow and inadequate response. That’s when they opened the sluice gates and spewed out money. With the emphasis on getting money spent, it’s not surprising there would be more than the usual amount of fraud and waste.
There was. A hotel owner in Sugar Land, Texas, for example, submitted $232,000 in bills for victims who never stayed at his hotel, the Times reported. About 1,000 prison inmates in the Gulf Coast collected about $10 million in rental assistance. FEMA spent $7.9 million to renovate a former Army base in Alabama. Ten hurricane victims showed up.
Remember the mobile homes that FEMA bought for temporary housing?
The agency, it turns out, bought about 20,000 of them at $34,500 apiece (you’d think they would have gotten a quantity discount). But local officials balked at setting them up in inland locations, and most were never used. About 10,000 of them are now sitting at an airfield in Arkansas, where taxpayers are still paying some $250,000 a month for space rental.
Then, of course, there was the Louisiana Department of Labor clerk who has been charged with issuing about 80 fraudulent disaster unemployment-benefit cards in exchange for bribes of up to $300 each.
He just wanted to “get something out of it,” he told one man he “helped.”
This tale of incompetence, fraud and failure will probably lead to FEMA having an even bigger budget next year. That’s the penalty for failure in government: You get more of the taxpayers’ money.
Instead, we should abolish FEMA and return disaster relief to state and local agencies and private charities. The feds have proved they can’t handle the job.