Hurricane Katrina

September 26, 2005

U.S. Armed Forces as First Responders

"On Sunday, President Bush called on Congress to consider a larger role for U.S. armed forces in responding to natural disasters, as he completed what White House aides called a weekend 'fact-finding' mission to determine whether the Pentagon needs more control," the Washington Post reports.

"Bush is asking Congress to consider a major change, potentially shifting federal responsibility for major natural disasters from the Department of Homeland Security to the nation's top military generals. The Defense Department has been hesitant to take such a role because of sensitivity to the idea of adopting a police presence on U.S. soil and because of strains on the armed forces from the war in Iraq."

In "Domestic Militarization: A Disaster in the Making," Gene Healy, senior editor at the Cato Institute, writes: "Having already wrecked a legendary American city, Hurricane Katrina may now be invoked to undermine a fundamental principle of American law; that principle, enshrined in the Posse Comitatus Act, is that when it comes to domestic policing, the military should be a last resort, not a first responder."

September 22, 2005

The Global Warming Blame Game

"In recorded history, two storms as powerful as Hurricanes Rita and Katrina have never hit the United States in one season. A coincidence, perhaps, but scientists say ocean temperature could be big factor," MSNBC.com reports.

"It's global warming that many experts say results partly from humans releasing greenhouse gases -- possibly creating even more violent storms in the future."

"While many people attempt to connect this season's unusually strong hurricane activity in the Gulf of Mexico with global warming, this is simply not the case," argues Patrick Michaels, senior fellow in environmental studies at the Cato Institute.

"Severe hurricanes, from Category 3 through 5 on the Saffir-Simpson scale, require water temperatures greater than 82 degrees Fahrenheit. However, beyond 82 degrees, there is no statistical relationship whatsoever between hurricane intensity and sea surface temperature, based upon an analysis of the 49 Category 3 or higher storms that occurred between 1982 and 2003. Because of its location, the Gulf of Mexico reaches or exceeds this critical temperature every year, regardless of planetary temperature."

In Meltdown: The Predictable Distortion of Global Warming by Scientists, Politicians, and the Media, Michaels discusses climate-change science. He cites hundreds of errors and exaggerations in scientific papers, news reports, and television sound bites--from the "National Assessment" of global warming, a Clinton-era document that used computer models that its authors knew did not work, to the infamous New York Times story about the melting of the North Pole, published in September 2000 and halfheartedly retracted three weeks later.

September 21, 2005

Rebuilding New Orleans

As the discussion turns to the rebuilding of New Orleans, the focus will shift to the best ways to accomplish the task and whether the federal government will play the lead role in the process. Cato’s Daniel Ikenson argues that President Bush can take the lead on the issue of rebuilding by making good trade decisions: “President Bush has already said he'll tap the Strategic Petroleum Reserve to help mitigate the post-Katrina oil shock. He should take a similar bold step on crucial (re)building materials — by repealing trade restraints on steel, lumber and cement.”

“U.S. trade policies restrict the supply and boost the costs of all these vital-to-reconstruction items. Indeed, pervasive restrictions on imported construction materials are already partly to blame for tight supplies and inflated prices. The exact impact varies enormously from product to product and year to year, but could push up prices by 50 percent or more. With severe shortages and spiking prices likely in the wake of the disaster, lifting those restrictions should be a no-brainer.”

School Choice for Katrina Displaced

"Under President Bush's plan to cover most of the cost of educating students displaced by Hurricane Katrina, parents could enroll their children in a private or religious school this year at federal expense, even if they had gone to public schools back home, administration officials said yesterday," the Washington Post reports.

"In proposing $1.9 billion in aid for kindergartners through 12th-graders whose schools were ruined by the storm, Education Secretary Margaret Spellings originally said the administration was setting aside $488 million for private-school tuition and other help, to re-create as normal an environment as possible for the uncommonly large segment of children from New Orleans who had attended Catholic schools."

Neal McCluskey, an education policy analyst at the Cato Institute, comments: "An important step in recovering from this calamity is for the children to reclaim a level of normalcy in their lives, and going to school enables them to do just that. Now is the time to help people whose lives were turned upside down by Katrina, not by forcing them into government schools, but by letting them choose the schools they actually want their children to attend, whether public or private."

In Voucher Wars: Waging the Legal Battle over School Choice, Clint Bolick recounts the dramatic 12-year battle to finally give families a choice in education and looks ahead to a future when every child can get the best education possible. While the battle over educational freedom is not over, Bolick notes that school choice "will begin to help our nation finally deliver on its promise of opportunity."

September 20, 2005

Catastrophe in Big Easy Demonstrates Big Government’s Failure

Cato executive vice president David Boaz on big government: “You've got to hand it to the advocates of big government. They're never embarrassed by the failures of government. On the contrary, the state's every malfunction is declared a reason to give government more money and more power.”

“Take Hurricane Katrina, a colossal failure of government at every level--federal, state, and local. Thirteen days after the hurricane, the Sunday Washington Post blared, 'The Steady Buildup to a City's Chaos/Confusion Reigned at Every Level of Government.'"

“And what's the response of the big-government crowd? 'The era of small government is over.' 'It's libertarianism, more than anything else, that has transformed [New Orleans] into an immense morgue.' 'Americans living along the Gulf Coast have now reaped the consequences of that hostility . . . to the role of government as a force for good.'"

“Let's look at the facts. Government failed to plan. Government spent $50 billion a year on homeland security without, apparently, preparing itself to deal with a widely predicted natural disaster. Government was sluggish in responding to the disaster. Government kept individuals, businesses, and charities from responding as quickly as they wanted. And at the deepest level, government so destroyed wealth and self-reliance in the people of New Orleans that they were unable to fend for themselves in a crisis.”

“And some people conclude that we have too little government?”

September 16, 2005

Bush Vows ‘Greater Federal Authority’

"Federal funds will cover the great majority of the costs of repairing public infrastructure in the disaster zone, from roads and bridges to schools and water systems," vowed President Bush in a speech to the nation on Thursday, as reported by CNN.com. "Our goal is to get the work done quickly. …And taxpayers expect this work to be done honestly and wisely, so we will have a team of inspector generals reviewing all expenditures.”

“It is now clear that a challenge on this scale requires greater federal authority," he said, "and a broader role for the armed forces -- the institution of our government most capable of massive logistical operations on a moment's notice."

In a piece for today's Newsday, Cato’s Steve Slivinski writes: "There's no reason why money spent on natural-disaster relief should not compete with spending in other areas of government. If the relief spending is truly more necessary than other programs in the budget, then those less essential programs should be pared back to make room for it. Congress does not seem concerned about how the federal government (read: taxpayers) is going to pay for any of this. Yet now is exactly the time to figure that out. Charity does require sacrifice, even from big-spending politicians using other people's money for charitable purposes."

Link Asserted Between Global Warming, Hurricanes

"A new study concludes that rising sea temperatures have been accompanied by a significant global increase in the most destructive hurricanes, adding fuel to an international debate over whether global warming contributed to the devastation wrought by Hurricane Katrina," the Washington Post reports. "The study, published Friday in the journal Science, is the second in six weeks to draw this conclusion, but other climatologists dispute the findings and argue that a recent spate of severe storms reflects nothing more than normal weather variability."

In "Sowing the Hurricane Whirlwind," Patrick Michaels, Cato senior fellow in environmental studies, argues that the media loves hurricanes because it can push a global warming agenda: "[Some people] claim that this year's hurricane activity is a product of global warming and that warming will make hurricanes worse. Here's the simplistic argument. Hurricanes require warm water. Global warming means more of that. Therefore, more hurricanes.

"The fact is that there's plenty of warm water for hurricanes every year -- virtually the entire tropical ocean is hot enough, and yet there are only about 10 per year in the Atlantic. The real research question on these storms is not why there are so many but, rather, why there are so few, given the massive expanse of warm water available to them."

September 15, 2005

Hurricane Economics

Cato’s Alan Reynolds takes on the idea of disaster relief as “economic stimulus,” in a piece today at townhall.com.

“The alleged "fiscal stimulus" of $62.3 billion of debt-financed federal funding in the hurricane-afflicted cities is pure illusion. The notion that replacing destroyed property will somehow boost the economy is, as economist Walter Williams reminds us, the old "broken window fallacy" exposed by Frederic Bastiat in 1848.”

“Breaking windows may create work for glaziers, but property owners whose windows were broken will then have less money left over to spend on something more enjoyable. Society then has to devote scarce real resources to this unfortunate task, rather than another. Meanwhile, interest expense on the extra $62.3 billion of national debt is a burden on taxpayers, not a free lunch.”

“There were about a million people potentially affected by the hurricane, so Congress plans to spend $62,300 for every man, woman and child who used to live in the affected area. In constant dollars, $62.3 billion far exceeds combined spending on the six biggest natural disasters since 1989.”

Return to Big Government

"President Bush will tell the nation tonight that he's committed to rebuilding New Orleans and the Gulf Coast, while eliminating the poverty and joblessness that were exposed in the wake of Hurricane Katrina," USA Today reports.

"In a prime-time speech from New Orleans, Bush also will pledge more federal help providing housing, health care and education to evacuees. 'We want to see a region that is better and stronger than before,' said Bush spokesman Scott McClellan."

In "No Longer out of Sight," Michael D. Tanner, director of health and welfare studies at the Cato Institute, writes: "In the wake of Hurricane Katrina, there will justifiably be calls to do something about the poverty that existed unseen in New Orleans and still exists in so many cities across America. Most of those speaking longest and loudest will be telling us to pour more money into various welfare programs. Doing so will help salve our conscience and tuck the poor safely out of sight until the next disaster forces us to face the consequences again. But it will do little to help these people escape poverty.

"The poor of New Orleans have been victims twice: of the storm and of the failed welfare state. As we pick up the pieces, let's not victimize them a third time. Let's try fighting poverty in ways that work."

In an article appearing in today's Washington Post, Cato Institute scholars Stephen Slivinski, director of budget studies, and Chris Edwards, director of tax policy studies, are quoted, warning of a looming "budget disaster," in response to the unprecedented federal spending for Hurricane Katrina relief.

To offset Katrina relief in the short-term and create savings to reduce the federal deficit over the long-term, Slivinski and Edwards propose $62 billion in spending cuts, including: "Cutting NASA in half, slashing energy research and subsidies just as Congress is gearing up to increase them in the face of soaring gasoline prices, cutting the U.S. Army Corps of Engineers' budget by $4.6 billion after its levees failed to protect New Orleans, and eliminating $4.2 billion in homeland security grants while lawmakers are debating the nation's lack of preparedness."

September 14, 2005

Katrina Blame Game

"President Bush yesterday said he takes personal responsibility for the federal government's stumbling response to Hurricane Katrina, as his White House worked on several fronts to move beyond the improvisation of the first days of the crisis and set a long-term course on a problem that aides now believe will shadow the balance of Bush's second term," reports the Washington Post.

"'Katrina exposed serious problems in our response capability at all levels of government,' Bush said at a White House news conference with Iraqi President Jalal Talabani. 'And to the extent that the federal government didn't fully do its job right, I take responsibility. I want to know what went right and what went wrong.'"

In "A Government Spread Too Thin," Patrick Basham, a senior fellow in Cato's Center for Representative Government, writes: "Politically, President Bush may find it difficult to recover from Hurricane Katrina, but not for the reasons you might think. Mr. Bush's real problem isn't aiding the hurricane victims or the search for uplifting Reaganesque rhetoric. Instead, it's the weight of an oversized federal government that hindered both preparation for and the response to this tragedy. It is a government that may fail again during this presidency. Mr. Bush did acknowledge the unacceptable nature of the relief effort. Since then, he's paddled furiously to stay ahead of the media and partisan blame game, but point-scoring shouldn't be the president's principal political concern."

September 13, 2005

Fearing Political Backlash in Katrina’s Wake, Congress Tables Plans to Extend Tax Cuts

From the Wall Street Journal: “In a major shift of priorities after Hurricane Katrina, Republican leaders in Congress have delayed plans to extend dividend and capital gains tax cuts and may shelve them for the rest of the year.”

“The House and Senate had planned a fall legislative agenda around a massive budget bill that extended to 2010 the 15% tax rate on dividends and capital gains signed by President Bush two years ago. The cut was one of the president's signature initiatives and is seen inside the White House as a key part of his economic legacy.”

“The 15% rate isn't scheduled to expire until the end of 2008 -- meaning there's still time to push an extension through. But Republicans, chastened by the costs of rebuilding the Gulf Coast and negative public assessments of Washington's initial response to the hurricane, have decided that taking any action on the bill is politically untenable at least until late October in the suddenly changed political and budgetary environment.”

Quoted in the article is Majority Leader Bill Frist’s top budget aid Bill Hoagland, who says, "The overall environment here has been shaped by the large [Katrina] spending bills and I'm starting to sense that some people are getting a little nervous about the deficit."

September 12, 2005

Flood Damage Leaves Residents High and Dry

"Louisiana is facing an epic legal battle to determine who should pay to repair damaged properties, with insurance experts predicting that tens of thousands of homeowners will discover their insurance claims will not cover the cost of rebuilding their homes," according to the Financial Times.

"Jim Brown, Louisiana's insurance commissioner from 1992 until 2004, estimates that only a quarter of houses in the poorest areas affected by Hurricane Katrina had flood insurance. Standard insurance policies, carried by almost all homeowners, cover damage caused by storms but not floods."

In "Managing Catastrophe Risk" from Cato's Regulation magazine, Paul R. Kleindorfer and Howard Kunreuther conclude that "many simple risk-mitigation measures (RMMs) would save homeowners, insurers, and taxpayers a lot of money. But homeowners do not invest voluntarily and insurers do not reward such investment behavior because of a variety of existing policies as well as decision-making limitations. Limitations in individuals' ability to judge and prepare for the consequences of rare events also decrease their willingness to invest in RMMs. And housing developers do not reveal information about the disaster resistance of their structures because potential purchasers do not seem to value mitigation and banks and insurers do not have enough incentive to care."

Spending Spree

Today on CNBC's Countdown to Opening Bell, Representative John Hostettler (R-IN) - one of only 11 members of the House to vote against Thursday's $51.8 billion emergency relief package - noted, "We are going to spend more in 7 weeks on Katrina than the combined fiscal budgets of Lousiana, Mississippi, and Alabama spend in 78 weeks."

In a report by USA Today, Senator Jeff Sessions (R-AL) is quoted as saying, "This is so massive and the potential for fraud and abuse is so great, we are going to have to watch it. The government will spend your money before you know what happened to it."

Cato policy analyst Radley Balko, in a piece for FoxNews.com, explains why trusting government in these matters may be a perilous decision.

September 9, 2005

An Op-Ed Frenzy

Will Wilkinson, a policy analyst at the Cato Institute, highlights the Katrina-related absurdity on the nation's big editorial pages today in a piece for Tech Central Station. Wilkinson writes: "Why did government fail so totally to fulfill its basic tasks? Why does Orleans Parish have a poverty rate of 34%, almost triple the national average? These are hard questions that demand serious answers. But rather than offer serious answers, the wise scribes at America's elite newspapers prefer to use the occasion of disaster, death, and mourning to parade their benighted ideological prejudices."

"Maureen Dowd at the New York Times opines, "when you combine limited government with incompetent government, lethal stuff happens." The Washington Post's Harold Meyerson belches, "more than anything else," it is the president's "economic libertarianism . . . that has transformed a great city into an immense morgue."

"Dowd's statement leaves her reader in lurch. Her entire column is about the incompetence of the government. So what is she saying about limited government? When you combine limited government with competence does "lethal stuff" still happen? If not, the problem is just incompetence. And then why mention limited government at all? Dowd must think there is something dangerous about limited government, per se. But the alternative is. . . what? Unlimited government? She's not making sense..."

"Far more baffling is Dowd's bizarre conviction that our present government, in addition to being incompetent, is in fact limited in some principled way. Dowd's Times colleague Paul Krugman labors under a similar fatuity, writing that "the federal government's lethal ineptitude . . . was as a consequence of ideological hostility to the very idea of using government to serve the public good."

"But President Bush has been on an historic spending spree, each cent no doubt justified by an appeal to the numinous public good. FEMA, having been brought under the umbrella of the Department of Homeland Security, is now part of the newest, largest, most lavishly funded bureaucracy in US history, instituted for our common protection."

Congress Rams Through Emergency FEMA Funding

"Congress yesterday passed a $51.8 billion emergency package to keep the Federal Emergency Management Agency from running out of money, but both Democrats and Republicans said the administration must be accountable when it comes back for the next installment," reports the Washington Times. "The bill passed the House 410-11, with 11 Republicans voting against it, and was then approved by the Senate 97-0. The White House said President Bush is going to spend whatever it takes."

The rush is on. It is apparent that almost nobody in Washington, including the President, wants to be viewed as being against helping the hurricane victims. FEMA is currently allocating federal money in hurricane areas at an astonishing rate of $2 billion per day.

• "Federal Failure in New Orleans" by Doug Bandow
• "A Government Spread Too Thin" by Patrick Basham
• "The FEMA Snow Job" by James Bovard

September 8, 2005

Funds for New Orleans Diverted for Pork

"Before Hurricane Katrina breached a levee on the New Orleans Industrial Canal, the Army Corps of Engineers had already launched a $748 million construction project at that very location. But the project had nothing to do with flood control. The Corps was building a huge new lock for the canal, an effort to accommodate steadily increasing barge traffic. Except that barge traffic on the canal has been steadily decreasing," reports the Washington Post.

"In Katrina's wake, Louisiana politicians and other critics have complained about paltry funding for the Army Corps in general and Louisiana projects in particular. But over the five years of President Bush's administration, Louisiana has received far more money for Corps civil works projects than any other state, about $1.9 billion."

In "Both Parties Find Trough to Their Liking," Chris Edwards, Cato's director of tax policy, points out that spending on pork-barrel projects is nothing new: "Federal pork spending has exploded in recent years. The highway bill passed in July was bloated with 6,371 pork projects, or earmarks, inserted by members of Congress. Overall, the number of pork projects has increased ten-fold during the past decade. ...The pork explosion is a neon sign advertising the fiscal failure of today's congressional leadership."

Bush Wants Additional $51.8 Billion in Katrina Aid

"President George W. Bush on Wednesday dramatically boosted the federal response to Hurricane Katrina when he called on Congress to approve $51.8 billon in additional funding to aid relief efforts," the Financial Times reports. "The request -- more than double the total federal aid granted to New York after the September 11, 2001 terrorist attacks -- is expected to be followed by additional demands. According to some congressional estimates, federal aid could reach more than $150 billion, raising fears about the storm's impact on the federal deficit."

In the Policy Analysis "The Grand Old Spending Party: How Republicans Became Big Spenders," Stephen Slivinski, director of Cato's budget studies, details the spending history of the Republicans and names President Bush as "the biggest spending president since Lyndon B. Johnson."

According to Slivinski, "Once President Bush was elected, the spending floodgates opened: Congress sent to the president's desk budgets that spent a total of $91 billion more than the president requested for domestic spending. Instead of drawing the line at his already-extravagant budget proposals, Bush signed every spending bill during his first term." This lack of restraint led to a 33 percent increase in his first four years.

September 7, 2005

Horsing Around with FEMA

"Top officials of the Federal Emergency Management Agency have strong political connections to President Bush, but they also share at least one other trait: They had little or no experience in disaster management before landing in top FEMA posts," according to the Chicago Tribune.

"Michael Brown, who heads FEMA as undersecretary of homeland security for emergency preparedness and response, already has endured sharp criticism for comments he made last week that seemed to suggest he did not understand that thousands of victims of Hurricane Katrina had taken refuge at the New Orleans convention center. Before joining FEMA in 2001, Brown, a protégé of longtime Bush aide Joseph Allbaugh, was commissioner of the International Arabian Horse Association and had virtually no experience in disaster management."

In Chapter 15 of the Cato Handbook on Policy, Stephen Slivinski, Cato's director of budget studies, and Dean Stansel, former Cato fiscal policy analyst, argue that many government agencies are costly and need to be eliminated, including FEMA, which costs taxpayers $3 billion a year: "Any time there is a natural disaster, FEMA is trotted out as an example of how well government programs work. In reality, by using taxpayer dollars to provide disaster relief and subsidized insurance, FEMA itself encourages Americans to build in disaster-prone areas and makes the rest of us pick up the tab for those risky decisions. Americans should not be forced to pay the cost of rebuilding oceanfront summer homes."

Repeal the Federal Gas Tax

"House Republican Leader Tom DeLay said on Tuesday there was no support for rolling back the federal gasoline tax to offset higher prices," Reuters reports.

"'Absolutely not,' he told reporters after a meeting with President George W. Bush on issues related to Hurricane Katrina. 'Now more than ever you're going to need ... that infrastructure, those highway trust funds, to rebuild the bridges that were destroyed, rebuild the railroads that were destroyed. You have to have the infrastructure or you can't have a recovery,' DeLay, of Texas, said."

"What has been the fastest-growing federal tax imposed on middle-income Americans over the past 20 years?," asks Stephen Moore, the former director of Cato's fiscal policy studies, in "Give Motorists a Tax Break." "It's the federal gasoline tax. The federal penalty for driving in 1980 was a tax of 4 cents a gallon. But the tax climbed by 5 cents a gallon under Reagan in 1982; by another 5 cents a gallon under George Bush in 1989; and by an additional 4.3 cents a gallon under Bill Clinton in 1993."

Moore continues: "For those who are counting, that's a steep four-and-a-half-fold increase in 16 years. When state and local gas levies are included, motorists in many states now pay 40 to 50 cents a gallon. It's hard to say where all the money has gone. Clearly, the nation's roads aren't four and a half times better today than they were 15 years ago. In fact, it seems that there are more watermelon-sized potholes nowadays than ever."

September 6, 2005

Private Charities, Not Government, to the Rescue

"Former President Bill Clinton on Monday said the government 'failed' the thousands of people who lived in coastal communities devastated by Hurricane Katrina, and said a federal investigation was warranted in due time," CNN.com reports.

"He and former President George H. W. Bush have launched the Bush-Clinton Katrina Fund to help raise money for those left homeless by the storm."

In "Civil Society to the Rescue," Michael Tanner, Cato's director of health and welfare studies, observes, "Private charities have been more successful than government welfare has at actually helping people for several reasons.

"[Perhaps most importantly], private charity requires a different attitude on the part of both recipients and donors. Recipients learn that private charity is not an entitlement but a gift carrying reciprocal obligations. Donors learn that private charity demands they become directly involved. There is no compassion in spending someone else's money--even for a good cause. True compassion depends on personal involvement.

"Thus private charity is ennobling for everyone involved, both those who give and those who receive. Government welfare ennobles no one."

Cato's Handbook on Policy states: "Any time there is a natural disaster FEMA (Federal Emergency Management Agency) is trotted out as an example of how well government programs work. In reality, by using taxpayer dollars to provide disaster relief and subsidized insurance, FEMA itself encourages Americans to build in disaster-prone areas and makes the rest of us pick up the tab for those risky decisions. In a well-functioning private marketplace, individuals who chose to build houses in flood plains or hurricane zones would bear the cost of the increased risk through higher insurance premiums. FEMA's activities undermine that process. Americans should not be forced to pay the cost of rebuilding oceanfront summer homes. This $4 billion a year agency should be abolished."