Transcript: Gulf Coast Rebuilding Chief on 'FNS'

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The following is a partial transcript of the Aug. 27, 2006, edition of "FOX News Sunday With Chris Wallace":

"FOX NEWS SUNDAY" HOST CHRIS WALLACE: Joining us now, Don Powell, the president's point man for rebuilding the Gulf Coast.

Mr. Powell, thanks for coming in.


WALLACE: Let's start with Tropical Storm Ernesto, which has just been upgraded to a hurricane, and could, according to some forecasts, hit the Gulf Coast over the next few days. Now, the head of the U.S. Army Corps of Engineers said yesterday he doesn't know if the rebuilt levees in New Orleans could withstand another hurricane.

What kind of shape is New Orleans and the whole Gulf Coast in to handle another major hurricane?

POWELL: I think we're in good shape. I know that the local people, the local officials, the state officials have been coordinating with the federal officials to anticipate this day. Hopefully, this will not come, but there is a widespread coordination, and I think we're ready. There's no question in my mind, we're ready.

WALLACE: And what about those levees that the Army Corps of Engineers says maybe can't withstand another hurricane?

POWELL: There's been an extraordinary amount of effort by the Corps of Engineers on restoring and repairing the levees, and I believe that the levees are ready for the hurricane season.

WALLACE: Let's take a look at the general rebuilding situation in New Orleans today, one year after Hurricane Katrina. Here it is.

More than 200,000 former residents — that's roughly half the pre-Katrina city — are still displaced. Only 29 percent of the schools have reopened. Only 17 percent of the buses are now operational.

Mr. Powell, a year later, are you satisfied with what's been done so far to rebuild New Orleans?

POWELL: Chris, let's step back just a minute and talk about this devastation. The city of New Orleans, 80 percent of the city of New Orleans, was underwater for 57 days. That's an area seven times larger than Manhattan. There was more debris in the Gulf Coast than all of Andrew and the World Trade Center, combined. There was 1,500,000 people affected by this storm, of which 800,000 of those were displaced citizens.

So this was a gigantic, catastrophic eventant for us to understand how large that is. The city of New Orleans, if it were a country, its gross national product would be the port, tourism and energy. The port is back to pre-Katrina levels, tonnage is back. Ship calls are more than they were pre Katrina.

The port is active. It touches 33 states in America, affects 62 percent of all of the consumers in America and it's back. Energy, 25 percent of the domestic production is supplied by the Gulf. It's all back. Refineries, oil, gas...

WALLACE: So you're saying there are no problems?

POWELL: I'm saying that those three components, tourism, energy and the port, is back to pre-Katrina levels, and that's critically important. Lots of jobs served by those industries. It's very important.

WALLACE: You are the president's point man for rebuilding the region. I want to take you back to the speech that President Bush made two weeks after Katrina, from Jackson Square in New Orleans.

Take a look.


GEORGE W. BUSH (R), PRESIDENT OF THE UNITED STATES: We have a duty to confront this poverty with bold action. We will identify property in the region owned by the federal government and provide building sites to low-income citizens, free of charge, through a lottery.


WALLACE: In fact, Mr. Powell, two of the three promises that the president made that night to fight poverty were never kept: the worker recovery accounts to help evacuees as they were looking for jobs after the displacement of the hurricane and the Urban Homestead Act, which was going to provide free land. Neither of those things ever happened.

Would New Orleans be in better shape today if the president and Congress had kept those promises?

POWELL: Chris, there has been an unprecedented amount of federal aid gone to the Gulf Coast, $110 billion has been allocated. Almost 50 percent of that money has been spent to the Gulf Coast. The balance is not unlike your checkbook. When you receive payment for your wages in your checkbook, you wait and you draw down on that checking account when you have bills to present.

So the balance of that money is going to be spent. So there has been an enormous amount of aid from the federal government to the Gulf Coast.

WALLACE: But, having said all that, we've got the U.S. Army Corps of Engineers saying the levees are, at best, state-of-the-art 1965 flood protection. Crime was so bad last month that they had to call in the National Guard. There's no city plan for rebuilding the city. A lot of people are just doing it on their own and building houses the same level, no elevation at all, could create another flood.

Aren't we spending those billions of dollars of taxpayer money to build another New Orleans with all of the same problems?

POWELL: The levees are back to where they were pre Katrina, and they're on their way to be the best, better and stronger than they have ever been. They will be certified to the 100-year floodplain by 2010.

The planning process for rebuilding New Orleans is the responsibility of the local people, and just this past week, the city council and the mayor agreed to the planning process, together with the Louisiana Recovery Authority. There's lots of progress that's occurring in New Orleans.

WALLACE: So, basically, you're saying, "Good news."

POWELL: I'm saying that we still have a long way to go, but the president's in it for the long haul. This is a process. It's not a one-time event. But there has been lots of progress.

WALLACE: Mr. Powell, we're going to have to leave it there. We want to thank you so much for updating us...

POWELL: Thank you, Chris.

WALLACE: ... on the situation along the Gulf Coast.

POWELL: Thank you, sir.