January 4, 2011
In 2006, Chris Edwards discussed FEMA’s “deep-seated and long-standing” record of wasteful spending on Bill O’Reilly’s radio show. At the time, a government auditor’s report found that at least $1 billion out of $6 billion in one FEMA aid program for Hurricane Katrina was paid out fraudulently, including money spent on a Girls Gone Wild video.
Unfortunately, FEMA’s poor stewardship of taxpayer money continues.
Last year, an independent audit of FEMA’s disaster contract management conducted for the inspector general’s office spent forty pages detailing mismanagement and wasted taxpayer money. For example, three of the contracts had cost overruns of 1000 percent or more for activities such as housing inspections.
A new audit from the Department of Homeland Security’s inspector general finds that FEMA has yet to even approve a recoupment process for a whopping $643 million in improper disaster assistance payments made to 160,000 applicants following hurricanes Katrina and Rita. It’s bad enough that FEMA made 160,000 mistakes at a total cost to taxpayers of more than a half billion dollars. But as the audit explains, FEMA has had since June 2007 to come up with a gameplan for recouping the money.
A Cato essay on fraud and abuse in federal programs explains that subsidies provided in the wake of emergencies are highly susceptible to fraud and abuse because funds are usually pushed out the door quickly with little planning or oversight.” Given the federal government’s continued post-emergency bureaucratic bungling, Congress should devolve responsibility for disaster assistance to state and local governments, private insurance companies, and charities.
