Hey, Big Spender
Senators Mary Landrieu (D-La.) and David Vitter (R-La.) took Bush up on his promise and presented a bill asking for $250 billion for Gulf Coast reconstruction, in addition to the $62.3 billion in already approved emergency spending (which works out to $312,300 per person potentially affected by the storm). The new bill includes $40 billion for the Army Corps of Engineers in Louisiana—10 times last year’s Corps budget for the entire country—as well as $50 billion for communities with vague “long-term recovery” plans, and even more blatant boondoggles like $8 million for training on how to preserve historical artworks, $8 million for alligator farms, and $35 million for seafood-industry marketing.
But there’s no free lunch. Spending billions on these pet projects will require either raising taxes on everyone or cutting spending on other government programs. Although the Bush administration is right to rule out tax increases to finance the reconstruction—increasing taxes would undercut our economic growth at the worst possible time—without spending cuts, the country will simply go further into debt, which amounts to simply a delayed tax increase. And with discretionary spending soaring at eight percent each year under the Bush administration, there’s little reason to believe that there will be spending cuts to compensate for Gulf Coast reconstruction. Instead, our generation will be left to pick up the tab for our present-day leaders’ generosity.
Who is going to benefit from this largess? It won’t be the poor Superdome victims highlighted on national television. Instead, chances are that cronyism and corruption will line the pockets of well-connected businessmen and officials. The government has a proven inability to manage and oversee spending (just think about the Big Dig), and Louisiana—a byword for political corruption—is probably the last place in America that should get billions of no-strings-attached dollars. This is the state that ranked third in per capita public corruption convictions over the past decade. (Neighborhing Mississippi was first.) Friends of the Bush administration are already salivating at the sight of billions in no-bid contracts, and like the reconstruction of Iraq, the money allocated for the reconstruction of the Gulf Coast is liable to windup in useless pet projects or outright malfeasance.
Moreover, beyond the issue of the Louisiana senators’ bald-faced avarice and the bill’s grotesque fiscal obscenity, the basic question is, why should the rest of the country pay to rebuild New Orleans? If it is worth being rebuilt, then it will be rebuilt on its own, through private investment. Clearly, certain parts of the city will be rebuilt—perhaps the historical districts, perhaps the docks—but these districts would be rebuilt without government intervention because there is private incentive to build them (in the examples above, tourist dollars and shipping dollars, respectively). The victims of Katrina deserve more than rebuilding for the sake of rebuilding; they would be better off if the federal government spent a fraction of the proposed reconstruction money on helping them resettle in other areas of the country that are not in danger of being submerged and, more importantly, have more economic opportunity than the now-moribund coast.
The solution to bad government isn’t more government; only in politics does colossal failure lead to increased funding. Instead of attempting to resurrect New Orleans by sheer force of bureaucratic will, the federal government should limit itself to rebuilding basic public infrastructures, like roads, and take a few simple steps to empower victims, helping individuals to help themselves. To its credit, the Bush administration has taken some steps in the right direction. Regulatory relief, which encourages entrepreneurship and reduces the cost of rebuilding, will help. So will the innovative Urban Homesteading Act, which, by allowing victims to gain title to federal land, could be a successful low-income housing program that actually builds communities instead of housing projects.
However, the vast majority of spending is not going to victims themselves and is instead being spent “on their behalf” by officials who are confident that they know best. This gravy train—more than twice the inflation-adjusted size of the Marshall Plan—will please politicians (and their friends) but won’t actually help victims. Instead, the government should directly give victims money, allowing them to escape or rebuild the Gulf Coast as they see fit. The government should give victims vouchers and let the private market supply housing, not order FEMA to build refugee camps. Before the elephant of big-government conservatism stumbles into mangrove swamps, vowing to set things right, Republicans need to remember that the lesson of Katrina is that individuals and local communities should be empowered, not trapped in moral or financial dependency upon an inept federal government.
Piotr C. Brzezinski ’07, a Crimson editorial editor, is a social studies concentrator in Winthrop House.