This is a rush transcript from "Your World With Neil Cavuto," August 27, 2010. This copy may not be in its final form and may be updated.

NEIL CAVUTO, HOST: Five years after Katrina, $5 billion in aid still unspent. Are you hearing this? That is a quarter of the more than $20 billion in housing and urban development relief funds promised for Gulf states. And now the big storm after the big storm and the big financial fuss over what happened to the dough. How could this have happened?

Michael Brown knows bureaucratic incompetence -- the man who became a caricature for all that went wrong in Katrina, but was later completely vindicated on Katrina, here to say this was not only a storm of monstrous proportions. It was a perfect storm of mixed and muddled oversight of even bigger proportions that continues to this day.

The former head of FEMA, Michael Brown, with me right now.

Michael, good to have you back.

MICHAEL BROWN, FORMER FEDERAL EMERGENCY MANAGEMENT AGENCY DIRECTOR: Hi, Neil. How are you?

CAVUTO: How do you feel, by the way, about this anniversary? They always truck out the old video and --

BROWN: Oh, I know, you know, "Heck of a job," all of that.

But it's been fascinating to come down here. And I have been visiting with people. I was having dinner last night and talked to a man for almost an hour that was trapped in the Superdome. And he told me a story about it. It was a fascinating story. So it has been a very good reception down here the past couple of days.

CAVUTO: You know, the general media will never, ever get beyond looking at the facts in the case and the investigation of Katrina --

BROWN: Right.

CAVUTO: -- and the fact that you were exonerated, and the fact that you did warn about the levees, and the fact that you did say some deep doo-doo is coming -- pardon my French here. That is neither here nor there.

BROWN: Right.

CAVUTO: So, let people have it with you.

I'm wondering why no one is having at it with officials today on the $5 billion that has as yet to be spent.

BROWN: Let me tell you something. I was shocked. I'm still kind of personally ticked off about Ground Zero and the fact that we don't have the Freedom Towers up yet, because of all the fights and the lawsuits and everything else.

And then I come down here, and I think the one place that bothered me the most was Charity Hospital, because that hospital, we worked so hard to take care of those patients and to evacuate them, get the generators in.

And do you know that today, five years later, Charity Hospital is surrounded by a barbed-wire and chain-link fence? Now, you have got to tell me. Somebody needs to go to whoever has got that paperwork on their desk and say, just fix it. Just do it. It's crazy.

CAVUTO: You know, I was reminded of the Gulf oil leak. And you and I got into this when we were getting in a philosophical discussion one time.

(LAUGHTER)

CAVUTO: And I have a theory on this that -- it's probably wrong, but I think, when you have so many cooks in the kitchen, the food is lousy. You know what I mean? And I think that everyone means well.

BROWN: Yes.

CAVUTO: I take nothing away from what various agencies and public officials are trying to do, but you don't know who is running the show.

(CROSSTALK)

CAVUTO: And, as a result, someone says, I thought you had that money covered. Oh, I thought you were going to move those trailers here. Oh, I thought you were going to -- and there's no point person.

BROWN: There's not.

And, in fact, what happens is, they are so -- and it's just -- I am not saying it is wrong. It's just -- it's human nature. There are so many rules and regulations that somebody could be sitting with that paperwork on their desk, and they know the right thing to do, but they are constrained by a rule and they are scared to death to go around that rule or to say, this is just stupid, this is what we need to do, because, as you and I know, they will be dragged in front of Congress, and there will be some pompous congressman with a camera in front of him berating this individual for having cutting a check for something.

CAVUTO: Right.

BROWN: In the meantime, it is just sitting there.

CAVUTO: And you know what is anything thing, Michael? We learned it with -- you remember the guy who -- the Christmas Day bomber, got on the plane?

BROWN: Yes.

CAVUTO: Plenty of warnings about him --

BROWN: That's right.

CAVUTO: -- plenty of emergency memos that were sent. One agency ignored, oh, the father of this guy on this flight says, watch out, my son is a lunatic and all that. And it gets lost.

BROWN: Right.

CAVUTO: Like what led up to 9/11, what happened with the Gulf oil spill, what -- time and again, we see it.

But we have not learned from Katrina, where it was this issue on steroids, have we?

BROWN: Not at all.

And, in fact, if Congress wanted to do something, they would step up and they would say, come to us and tell us how to rewrite the regulatory scheme that get this money out. Tell us how to move it faster. And then instead of waiting for the agencies to do it through the regulatory process, just enact statutes that say, you can go do this. Give them some flexibility. And let's recognize that that is the only way it's going to speed the process up.