Washington – Taxpayers will pay the bill for the massive reconstruction program outlined by President Bush for the hurricane ravaged-Gulf Coast and the huge expense will worsen the nation’s budget deficit, White House officials said today.
With disaster costs estimated at $200 billion and beyond, Al Hubbard, director of Bush’s National Economic Council, said, “It’s coming from the American taxpayer.” He acknowledged the costs would swell the deficit – projected at $333 billion for the current year before Hurricane Katrina slammed into the Gulf Coast.
President Bush, in an address to the nation Thursday night, said the recovery effort would be one of the largest reconstruction projects the world has ever seen. He promised that the federal government would pay for most of it.
Claude Allen, the president’s domestic policy adviser, said the administration had not identified any budget cuts to offset the disaster expense.
The government failed to respond adequately to Hurricane Katrina, Bush said. Dogged by criticism that Washington’s response to the hurricane was slow and inadequate, Bush said the nation has “every right to expect” more effective federal action in a time of emergency such as Katrina. The hurricane killed hundreds of people across five states, forced major evacuations and caused untold property damage.
Disaster planning must be a “national security priority,” he said, while ordering the Homeland Security Department to undertake an immediate review of emergency plans in every major American city.
“Our cities must have clear and up-to-date plans for responding to natural disasters and disease outbreaks or a terrorist attack, for evacuating large numbers of people in an emergency and for providing the food and water and security they would need,” Bush said.
He acknowledged that government agencies lacked coordination and were overwhelmed by Katrina and the subsequent flooding of New Orleans. He said a disaster on this scale requires greater federal authority and a broader role for the armed forces. He ordered all Cabinet secretaries to join in a comprehensive review of the government’s faulty response.
“When the federal government fails to meet such an obligation, I as president am responsible for the problem, and for the solution,” Bush said, looking into the camera that broadcast his speech live on the major television networks from historic Jackson Square in the heart of the French Quarter. “This government will learn the lessons of Hurricane Katrina.” Bush faced the nation at a vulnerable point in his presidency.
Most Americans disapprove of his handling of Katrina, and his job-approval rating has been dragged down to the lowest point of his presidency also because of dissatisfaction with the Iraq war and rising gasoline prices. He has struggled to demonstrate the same take-charge leadership he displayed after the Sept. 11 terror attacks four years ago.
Aaron Broussard, president of Jefferson Parish near New Orleans, was happy with Bush’s speech. “Mainly he gave hope, and right now in this area people need hope more than anything,” he told CBS’ “The Early Show.” In his speech, the president called for a congressional investigation besides the administration’s self-examination. But Democrats want an independent probe similar to the one conducted by the Sept. 11 Commission instead of reviews that will be led by the Republican-controlled Congress and White House.
The president said the federal government will pay most of the costs of rebuilding the Gulf Coast, including New Orleans.
“There is no way to imagine America without New Orleans, and this great city will rise again,” Bush said.
House Speaker Dennis Hastert, R-Ill., speaking after the president’s address, acknowledged that the recovery programs would add to the nation’s debt. GOP leaders are open to suggestions from lawmakers to cut government spending elsewhere, but the task is urgent, he said.
“For every dollar we spend on this means a dollar that’s going to take a little bit longer to balance the budget,” Hastert said.
Congress already has approved $62 billion for the disaster, but that is expected to run out next month.
Even before Bush spoke, some fiscal conservatives expressed alarm at the prospect of such massive federal outlays without cutting other spending.
“It is inexcusable for the White House and Congress to not even make the effort to find at least some offsets to this new spending,” said Sen. Tom Coburn, R-Okla.
Bush repeated a hotline number, 1-877-568-3317, for people to call to help reunite family members separated during the hurricane.
Moments later, Sen. John Kerry, D-Mass., criticized Bush, saying “Leadership isn’t a speech or a toll-free number.” Bush proposed establishment of worker recovery accounts providing up to $5,000 for job training, education and child care during victims’ search for employment. He also proposed creation of a Gulf Opportunity Zone in Louisiana, Mississippi and Alabama offering tax breaks to encourage businesses to stay in the devastated region and new businesses to open. The White House said today that each of those initiatives would cost about $2 billion.
Bush said the goal was to get evacuees out of shelters by mid-October and into apartments and other homes, with assistance from the government. He said he would work with Congress to ensure that states were reimbursed for the cost of caring for evacuees.
