A Flood of Fraud by Russell Mokhiber and Robert Weissman
There's no question that post-hurricane relief and reconstruction in New Orleans and the Gulf Coast are going to pose many genuinely difficult challenges.
But some things seem pretty simple.
For example, it's a dumb idea to have cruise ships house evacuees and then pay the cruise lines as four times what they would charge vacationers.
As it happens, however, that's exactly what the Federal Emergency Management Agency (FEMA) is doing. An investigation by Senators Tom Coburn, R-Oklahoma, and Barack Obama, D-Illinois, found that what should have been a short-term FEMA emergency deal is turning into a six-month boondoggle. FEMA has contracted with Carnival Cruise Lines, to the tune of $192 million, to house hurricane evacuees on three cruise ships.
The result, according to the senators: "Taxpayers are paying, per evacuee, four times the amount a vacation cruise passenger would have to pay. Three Carnival ships are only half full and mostly occupied by relief workers. Carnival's overhead costs in the FEMA operation are far lower than during normal cruises. The Carnival ships are docked. No fuel is being used and no entertainment is being provided to the relief workers. Yet, taxpayers are paying $2,550 per guest per week, which is four times the cost of a $599 per person '7 Day Western Caribbean' Cruise from Galveston, Texas."
Another thing that seems straightforward: the government should not be contracting with companies that have made a habit of ripping it off, or engaging in illegal and irresponsible activities. (That happens to be existing U.S. law, which stipulates that the government should contract only with "responsible prospective contractors.")
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