By Yochi J. Dreazen
The Wall Street Journal
Hurricane Katrina ended the government career of Federal Emergency Management Agency director Michael Brown, but it is providing his two immediate predecessors, both now in the private sector, with lucrative – and controversial – new opportunities.
Clinton administration FEMA director James Lee Witt has been hired as Louisiana Gov. Kathleen Babineaux Blanco’s top adviser on Hurricane Katrina relief efforts at a rate of $275 an hour.
His firm, James Lee Witt Associates, based in Washington, had a prior contract with Allstate Corp.’s Allstate Insurance Co. to lobby policymakers to create a government disaster fund to help insurers cover catastrophic losses after future storms.
After questions about a possible conflict of interest, however, he said he would suspend the insurance contract until he had finished advising Blanco.
Joe Allbaugh, who ran the agency for President Bush from 2001 through 2003, now operates a namesake Washington lobbying firm whose corporate clients are seeking – and winning – Katrina-related contracts.
One of his first steps after the storm hit was to fly to Louisiana to advise executives from the Shaw Group of Baton Rouge to help the company tailor its pitches to the various government entities doling out Katrina funding.
The effort, which involved an array of other lobbyists and consultants, worked: Shaw won a pair of no-bid, $100 million contracts with FEMA and the Army Corps of Engineers. Another of Allbaugh’s clients, controversial government contractor Halliburton Co., is repairing Navy facilities on the Gulf Coast under an existing $500 million contract.
Men such as Witt and Allbaugh are in demand for both their expertise and their connections. Each is an expert in navigating the often-Byzantine federal-procurement process, and each has a network of contacts inside federal, state and local government offices forged during his years at FEMA.
Blanco, for instance, hired Witt mainly to help with FEMA bureaucracy as she sought federal aid for relief and recovery efforts in her state, according to spokeswoman Denise Bottcher.
“His help there has in and of itself been invaluable,” Bottcher says. “FEMA is enormously complicated.”
The two men’s success also highlights the revolving door between government and the private sector, which has accelerated in recent years because of the enormous amounts of federal money allocated, first for the rebuilding of Iraq and now for hurricane-related efforts.
