Government Should Cut Spending to Offset Katrina Costs

President Bush recently announced a massive spending project to rebuild New Orleans, including a down payment of more than $50 billion. One of his key proposals is a modern homesteading law, in which the federal government will give state-owned land to anyone from the region who promises to build on it.

The end price could well be several hundred billion dollars. Pundits and editorial boards on the left are calling for even more spending — to rebuild the city, to compensate those who lost property in the flooding, and to address the class and race issues they say the storm exposed.

I find this all very hard to swallow. In its sluggish and inept response to Katrina, government at the local, state, and federal level failed on a massive, catastrophic scale. And the response is….we need more government?

We have a city built below sea level, one that is especially vulnerable to hurricanes and prone to flooding. It’s a city that sinks several inches per year into the Gulf of Mexico. Nearly every scientist with expertise in the field asserts that New Orleans will flood again, and that ensuing floods are likely to be worse than those before. Well-maintained levees and rebuilt wetlands — both very expensive to taxpayers — may delay the inevitable, but they won’t prevent it.

And the response is, we’re giving people free land to resettle in the area? Essentially, the government is asking taxpayers to rebuild a city that was destroyed by inept management of taxpayer dollars. We’re being asked to pay for incentives that will in all likelihood make the situation worse the next time it happens. And when it does happen, and the result is worse, they’ll almost certainly ask us to pay then, too.

New Orleans’ problems — both with respect to the storm and with respect to race and class — were created by government. The considerable poverty was created by decades of a federal welfare system that offered perverse incentives when it comes to building families and stability. The crime and destitution come from, among other things, a drug war that makes the violent drug trade exponentially more lucrative to people with dim prospects than more legitimate means of making a living. It is government policies that created a system ruled by heartbreaking mores and devastating values, where criminality and failure are lauded, while legitimate achievement is viewed with suspicion.

To the extent that the government failed the people in New Orleans — both in respect to its dismal storm response, and to the years of ill-considered policies that exacerbated it — government is obligated to help. But with two stipulations.

First, government help should be limited to making people hurt by Katrina whole again. Those who want to relocate should be permitted to do so. Katrina evacuees in Houston, San Antonio, and elsewhere shouldn’t be treated less favorably than those who want to return to New Orleans. In that they’re trying to escape the cycle of poverty and despair and start again, they should probably be treated better.

Likewise, New Orleans shouldn’t be “rebuilt” with government funds, nor with government planning. Government contracts are notoriously prone to cronyism and graft. Great cities flourish organically. Central planning begets miserable attempts at utopia.

Business owners should be compensated for what they lost, then be free to rebuild where they deem appropriate. Even if that isn’t New Orleans. Anyone who chooses to live or build there should do so without incentives from government, and with the clear understanding that from here forward, insurance and aid from natural disasters is a private matter. It’s simply not the government’s job to continue bailing people out of poor decisions.

And let’s be clear, to the extent that government does help those affected by Katrina, government should be making the sacrifices. Not taxpayers. The American people have already proven their generosity in the aftermath of Katrina. Donations to private charities have flourished. Corporations have made remarkable contributions to the relief effort. Civic organizations, philanthropic groups, and volunteers have shown that they— not our elected leaders— are what gives America its mettle. There’s no reason why taxpayers should be asked to pay for the failings of their government.

Some have suggested that Congress should revisit the pork-laden highway and energy bills. That’s a good start. Every congressman should be asked to axe one pork project from his district from either bills (or better yet, from both) to pay for compensating the victims of Katrina.

Likewise, every cabinet department within the federal government should be asked to trim 2 percent of its budget for relief efforts. The White House should trim its staff and expenditures, too. Each Congressional office should cut its budget for salary and office expenses. And given that bloat and bureaucracy within the Department of Homeland security aided the delayed response, DHS in particular should have to find extra ways to trim from its expenditures.

These measures would just be a start. The Cato Institute and the American Enterprise Institute have each also put together ways to trim the federal budget to pay for Katrina without raising taxes, or rescinding recent tax breaks.

Our elected officials are fond of asking us Americans to make sacrifices. Our two most recent former presidents have toured the country asking us to give money for relief efforts. That’s fine. But it’s time the politicians and bureaucrats whose neglect, oversight and pet projects gave rise to the problems we’re facing today made some sacrifices, too.

Radley Balko maintains the The Agitator weblog.

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