March 20, 2006


Behind Louisiana Aid Package, a Change of Heart by One Man (SHAILA DEWAN, 3/20/06, NY Times)

Louisiana was in a foul mood on the February day that President Bush's Gulf Coast rebuilding coordinator, Donald E. Powell, stood before an audience of fellow bankers in Baton Rouge.

Two weeks before, the administration had rejected Louisiana's housing recovery plan. Mr. Powell's own idea of housing aid excluded thousands of homeowners, many of them poor, who lived in the flood plain but did not have flood insurance when Hurricane Katrina hit.

Asked about those who had counted on federally built levees to protect them, Mr. Powell, a wealthy man from the dry Texas Panhandle, noted that he had been responsible enough to buy flood insurance for his home in Amarillo.

The members of the Louisiana Bankers Association were not won over. Nor was The Advocate, Baton Rouge's newspaper, which demanded Mr. Powell's dismissal, calling him a "flint-souled" bean counter whose only concern was "guarding the money."

Those with a more charitable view, Senator Mary L. Landrieu, Democrat of Louisiana, among them, complained that he lacked the authority to be effective, and some critics wondered if he was simply another presidential crony.

But barely a week would pass before Mr. Powell did an about-face that turned many of his critics into fans, showing that not only had he listened to the locals, but also that his conclusions had carried weight with Mr. Bush.

With Gov. Kathleen Babineaux Blanco and Mayor C. Ray Nagin at his side, Mr. Powell announced that the president would seek $4.2 billion more for Louisiana to compensate homeowners — even those in the flood plain.

Mr. Powell's epiphany came after hours of listening to Louisianians: the decision makers; the woman who cleaned his room at the Sheraton; Victoria Reggie Kennedy, the wife of Senator Edward M. Kennedy (whom he called after hearing she was a Louisiana native); the inspectors examining high-water marks in homes. As he drove through New Orleans with Mr. Bush on March 8, he pointed to a small restaurant in the Ninth Ward and rattled off the owner's real estate woes.

"He had a learning experience," said Walter Isaacson, vice chairman of the Louisiana Recovery Authority. "It's the most amazing thing for somebody of his stature. It's because by himself, he walked around. He walked around and talked to people."

Mr. Powell says walking about in the region incognito, in blue jeans and boots, is becoming a bit harder now that people are starting to recognize him. "I went with no preconceived thoughts," he said. "And I realized that while Mississippi was an act of God, Louisiana was an act of God and man. There were some flaws. The levees breached."

Last week, Mr. Powell spent much of his time lobbying House members, successfully, to preserve the appropriation.

Posted by Orrin Judd at March 20, 2006 8:32 AM

Sometimes it's hard not to break my own rule of giving the president the benefit of the doubt when something like this happens. It's probably quid pro quo for voting for ANWR, but it still sticks in my craw that he does business with these despicable creatures.

Posted by: erp at March 20, 2006 9:51 AM

poor people who lost their homes?

Posted by: oj at March 20, 2006 9:54 AM

People who built in risky areas and expect someone else to pay the bill.

I am fine with buying them out – i.e. pay pre-flood fair market value with the proviso that it's now federal wetlands, no building allowed. Not one penny to rebuild. It's one thing to help out when someone's made a mistake, it another to pay them to make the same mistake again.

Posted by: Annoying Old Guy at March 20, 2006 10:18 AM

"People who built in risky areas and expect someone else to pay the bill."

Like, say, the entire West Coast? Anyone in tornado alley or the hurricane zones in Texas, Florida, the Carolinas? The southern half of the big island of Hawaii? Because if you, or anyone else, builds something there, anyone can put down good money on the chances of something serious hitting it within the space of a few decades.

Also stunning that you believe that the "poor people who lost their homes" also built them there. They found housing where they could, and like everyone else they believed that because the neighborhoods had been there for decades, they would continue to be there.

Posted by: M. Bulger at March 20, 2006 10:36 AM

M. has a good point - it's one thing to gripe about people who build on beach property (for a second home, a rental property, or just an investment), but the people who lived in New Orleans weren't making the same choice - they were living where they could, with what resources they had at hand. And how many of them actually owned their homes? Does anyone have any figures for New Orleans? For the infamous Lower Ninth Ward? For the Eastern suburbs?

Posted by: jim hamlen at March 20, 2006 11:10 AM

they were living where they could, with what resources they had at hand. And how many of them actually owned their homes?

SOMEBODY owned the homes! Flood insurance is cheap. Why should those owners who chose not to take out flood insurance be reimbursed by other taxpayers for being irresponsible?

Isn't that contrary to the sense of responsibility that the ownership society is supposed to foster?

Posted by: kevin whited at March 20, 2006 11:41 AM

M. Bulger;

I would offer the exact same deal to those people as well – collect from the federal government and it means that the area is too dangerous to build in. You get bought out and don't get to rebuild. Don't want to be bought out? Buy private insurance.

Posted by: Annoying Old Guy at March 20, 2006 1:03 PM


There was a story in yesterday's NO Times-Picayune that made the discovery that upwards of 2/3 of the homes in Orleans Parish had flood insurance. This was thought to be quite different than the previous assumption made. This also explains the massive payouts that have forced the program to borrow from the Treasury.

This, however, still does not explain why any further funds should be used to subsidize residential investment property in NOLA. Which, apparently, is what at least 50% of the residences are.

Posted by: Brad S at March 20, 2006 1:49 PM


There is a problem with the assumption that the neighborhoods would be around "forever." While the Times-Picayune continually castigates the Army Corps of Engineers (an easy target, to be sure) for its role in the levee failures, one of its own series in 2002 stated in no uncertain terms that NOLA should not believe for one minute that the levees would hold. Not to mention that the idea that NOLA would drown in a large hurricane surge has been a source of common knowledge throughout the populace.

Posted by: Brad S at March 20, 2006 1:55 PM

This case is a little different from the usual flood because the levy that failed was poorly designed and, in effect, built to fail by the state and federal government. It is a shame that the Corps of Engineers, perhaps the most overrated of government agencies, won't suffer any as a result of its failure.

As for paying people to rebuild in a flood plain, I'm against it, but the politics are undeniable. At least, as sheer waste of federal money goes, it is a relatively small amount of money.

Posted by: David Cohen at March 21, 2006 8:25 AM