Taxpayers Send $62B to “Free Money” FEMA

Bush has declared that the cost of rebuilding after Katrina will “cost whatever it costs ” and has promised to “be wise about the money we spend.”

Taxpayers have already handed over an $62.3 billion to FEMA (with a possible total of $200 billion) even though the agency has badly mismanged much smaller sums of money.

The Florida Sun-Sentinel examined 20 of the 313 disasters declared by FEMA from 1999-2004 and found that 27% of the $1.2 billion in those disasters went to “areas where official reports showed only minor damage or none at all.”

The full article can be found here. It’s not hard to understand how the agency aquired the nickname “free money” FEMA:

Misallocation: $41.4 million to 28,500 Cleveland-area residents for a 2003 storm that brought less than an inch and a half of rain; city officials documented 73 homes with only minor damage. $21.6 million went to pay for “clothing losses.” $168.5 million to Detroit residents for a rainstorm in 2000 that the then-mayor doesn’t even remember.

Scams: Scamming FEMA is notoriously easy. “All you had to do was tell FEMA stuff was ruined and they’d send you a check….If you had a little water in the basement, you could throw some stuff down there and get some money for it.”

Poor Follow-up:“FEMA rarely follows up to see how the money was spent” and one resident reports being able to rent a second house with her FEMA check.

In the midst of all this waste, many victims are still waiting for FEMA to notice them; some disaster victims in Iowa are still paying taxes on worthless land, lost in flooding.