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The Big Easy highlights Bush's fiscal facade

By Jason Leopold - posted Thursday, 29 September 2005


Republicans like to brag that, as a political party, they are more fiscally responsible than their Democratic counterparts. Well, thanks to President Bush’s four years in office, that theory can now take up residence in the urban legend department.

If anything, Bush’s tenure as president proves the Republican tax cuts (which everyone knows truly benefit the wealthiest 1 per cent) have cost taxpayers and their unborn grandchildren more money than anyone could have ever imagined - by drastically slashing funds in the federal budget for much-needed improvements to the country’s ageing infrastructure (a perfect example being the outdated power grid), and trying to get away with launching wars on the cheap.

Simply put, since he became president, Bush has not invested the funds to fix the cracks in the country’s façade, despite repeated warnings from experts and intense lobbying by state officials that ignoring the problem will make it worse in the long run. Instead, the President pumped tens of billions of dollars into an unnecessary war that, when it became evident attaining victory was tougher than the war planners imagined, required tens of billions of dollars more just to continue the fighting.

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Only when devastation and catastrophe struck the nation did the federal government cough up the funds. But by then there wasn’t much of choice, and a US$1 billion restoration project - before a devastating hurricane touched down on the Gulf Coast - has turned into a US$200 billion reconstruction effort and saddled taxpayers with economic woes that no tax cut can relieve.

You don’t have to look much further than New Orleans, a city wiped out by Hurricane Katrina, as evidence of the Bush administration’s and Congress’ fiscal irresponsibility. It’s a direct result of Washington’s financial incompetence that the cost for rebuilding The Big Easy is estimated to top US$200 billion.

Flooding is the most destructive and costly natural disaster in the United States, accounting for about 75 per cent of all disasters declared by the President annually. About 160 million acres, or 7 per cent of the United States, are estimated to be floodplains and urban expansion into floodplains continues at an increasing rate, according to the Public Entity Risk Institute, a non-profit think tank that aims to educate the public and government on disaster management.

Sadly, no one was becoming any smarter. Instead of funding flood-control projects, the Bush administration cut the Army Corps of Engineers’ budget, forcing the city of New Orleans to loan the agency US$1 million in December of 2003 to keep one crucial flood-control project from shutting down entirely.

“It's not every day that New Orleans has to bail out the federal government,” said the Times-Picayune in a January 2, 2004 story. “But that's exactly what happened last month when the Orleans Levee Board voted to advance the Army Corps of Engineers US$1 million to prevent a vital flood control project from shutting down.”

Al Naomi, a senior project manager for the corps, told the Picayune that federal funding had all but dried up, threatening to put hurricane protection plans that were already underway on hold indefinitely.

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Naomi said the corps had been strained for money, as the federal government's priorities had shifted to other concerns, such as homeland security, which prior to Hurricane Katrina meant protection from terrorist threats, and the war in Iraq.

Before Bush delivered his better-late-than-never speech to the nation earlier this month in front of Andrew Jackson’s statue in New Orleans, he personally shot down repeated requests for federal assistance from Louisiana officials over the past four years - the most recent in June - to help repair New Orleans’ eroding coastline. Even prior hurricanes, such as Ivan, which just missed New Orleans last September, wreaked havoc similar to that of Katrina on the city, forcing local officials to evacuate residents and call on the federal government for help. This was still not enough to sway President Bush to focus on domestic threats instead of pouring all of his energy into terrorism and the war in Iraq.

So, to hear the President in a televised speech promise to spend whatever it takes to rebuild one of the nation’s great cities is not a sign of progress: rather it’s a symbol of the total breakdown of his administration, and an attempt to conceal what could arguably have been a man-made disaster because of his policies.

The final blow, however, came in June. Louisiana state officials had been hoping a provision in the Senate energy bill calling for US$500 million in offshore energy revenue from the federal government would finally provide Louisiana and four other coastal states with the funds they desperately needed to repair their damaged wetlands to protect themselves, among other things, against possible weather-related disasters.

But the White House adamantly refused to part with the US$5 billion it gets from drilling in the Gulf Coast, its second biggest source of revenue (after the Internal Revenue Service), choosing to use most of those funds to finance the Iraq war.

To ensure that the message came across crystal clear, Bush ordered White House aides to take the unusual step of sending a letter to House and Senate negotiators advising them to kill the revenue-sharing plan in the final version of the energy bill.

The White House’s Office of Management and Budget released a policy statement in June that said the Bush administration opposed “the significant new funding authorisations and diversion” of Outer Continental Shelf revenue included in a national energy bill being discussed in Congress.

"Currently the federal government does share royalties with coastal states - more than US$3 trillion to date, in fact. Changing this amount only increases the budget deficit and diminishes the benefit the rest of the nation receives from these national resources," Scott Milburn, press secretary for the White House’s Office of Management and Budget, told The Associated Press in June.

“Disheartening,” “frustrating,” “upsetting” and “just another nail in my coffin” are how Louisiana senators, community leaders and coastal advocates responded to the news that the White House intervened and advised the Senate to defeat the revenue provision, according to a June 16 report in the Louisiana’s Houma Courier.

Ironically the erosion to the state’s coastline - which became considerably worse over the past five years - is due, in part, to oil and gas drilling in the Gulf, much of which takes place right in New Orleans. Although the state is responsible for repairing its coastline to support its oil and gas infrastructure, it barely benefits financially from the drilling that takes place in its own backyard.

“While inland states enjoy 50 per cent of the tax revenue from drilling on their federal lands, Louisiana gets back a mere $35 million of the $5 billion it contributes to the federal treasury each year from offshore drilling, or less than one per cent,” the Courier said.

In a written statement, Louisiana Democratic senator Mary Landrieu, condemned the White House position. Landrieu said the Bush administration simply could not  comprehend why Louisiana needed compensation for producing a bulk of the nation’s energy supply. Coastal oil and gas-producing states account for 25 per cent of the nation’s natural gas and 30 per cent of oil.

“The President’s statement indicates a failure to appreciate the burdens borne by the people of Louisiana and other coastal oil-and-gas-producing states,” Landrieu said.

It wasn’t long after the White House issued its statement on the revenue-sharing concept that Louisiana lawmakers predicted an apocalyptic end to New Orleans.

Louisiana civil engineer and coastal advocate Clifford Smith, who is also a member of the US Army Corps of Engineers’ Mississippi River Commission, told the Courier in June that without federal assistance New Orleans could very well drown if it took a direct hit from a hurricane.

"We’re not going to get the kind of recognition and concern we deserve until we have a disaster," he said.

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Article edited by Allan Sharp.
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About the Author

Jason Leopold is the author of the National Bestseller, News Junkie, a memoir. Visit www.newsjunkiebook.com for a preview. Mr. Leopold is also a two-time winner of the Project Censored award, most recently, in 2007, for an investigative story related to Halliburton's work in Iran.

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Creative Commons LicenseThis work is licensed under a Creative Commons License.

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