The Hurricane that Keeps Spending Our Money

August 26, 2010 by  
Filed under Fools of Finance

We have another post-Katrina announcement from one of Louisiana’s bevy of incompetent politicians.  The Federal Victim’s Insurance Company (aka FEMA) is dumping another $1.8 billion of taxpayer money into the New Orleans school system. Apparently, in the five years since Hurricane Katrina, school children in New Orleans haven’t become any smarter or less dependent on government support. So another $1.8 billion is supposed to change that.

If you read all the glowing reports about what a wonderful city New Orleans is or was, it’s all about drinking, eating, fishing, drilling for oil, then eating and drinking some more.  Periodically, you blow up an oil rig, soil the gulf, then call for another round of FEMA largesse. How much advanced education do you need to do that?

Also, according to the most recent statistics, approximately 20% of New Orleans’ population (100,000 dependents) left after Katrina and never came back. (Source) There are fewer than 400,000 residents now in New Orleans. Who is this $1.8 billion going to educate?

Of course the politicians will say that taxpayer money is being used to rebuild flood-damaged schools. If that is true, we can add “worlds most under-insured city” to New Orleans’  list of unwanted superlatives, along with “most female body parts exposed from public balconies”. We also know that at least 10%-20% of our taxpayer donation will be skimmed off the top to pay corruption tax.

If you want to live in New Orleans, I’m OK with that. After all, people still live in Detroit and I can’t figure that one out either. Just accept your risks, buy some insurance, and don’t ask me to pay for it when things go south. I felt the same way about GM and Chrysler.

Can we please have a statute of limitations on victim expectations?

Here is the full article: New Orleans schools get $1.8 billion for Katrina damage

P.S.  If you are reading this from your home in New Orleans or Detroit, feel free to comment but please don’t flame me. Remember, this blog has proudly featured the “hard truth about money and personal finance” from day one. Thick skins are needed all the way around. Grow one. Thanks.


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17 Responses to “The Hurricane that Keeps Spending Our Money”
  1. Money Beagle says:

    Detroit comment = not at all cool. Minus one subscriber and blogroll entry.

    • Sorry you are leaving. So much for thick skin. I was just speaking for the 1 million plus and counting folks who have escaped Detroit since 1950. When you elect people like Kwame Kilpatrick as your mayor, you’re gonna have problems.

      • Maria says:

        I am married to a man who grew up in Detroit and I have to agree with Mr. TML that it is hard to understand why people stay. The property taxes are surprisingly high even though the schools are dreadful, the police can barely keep up with rampant and pervasive violent crime (forget about small matters) and other city services (trash, mowing, fire, street cleaning and repair) are basically non existent. I agree that people should be free to live where they want to. I also think that taxpayer bailouts should be few and far between. So, right after the hurricane it probably made sense to provide massive support to New Orleans; how much benefit we will get from this latest infusion of cash is unclear. I suspect we will see a lot of the money siphoned off via the corrupt political process and the rest simply spent unwisely. Quite tragic in the middle of this economic downturn when a few smart, strategic steps (like some tax cuts) could actually create some jobs and help.

  2. Rick Beagle says:

    Not your finest article TML. Perhaps a bit more research would have been warranted instead of parroting the sound bites of people who really ought not to be trusted?

    Peace.
    Rick Beagle

    • So Rick I take it you believe that sending another $1.8 billion to NO for a five year old disaster is a wise expenditure of our tax dollars?

      • Rick Beagle says:

        Do I like my money being sent to any southern red state hoping that the money will truly be used to help the communities? No. As I have stated repeatedly, I despise the current crop of red/blue states that are perpetually on the federal welfare system.

        Isn’t there is a “fiscal” conservative leader in the Governor’s mansion? If I understand the governor’s powers in LO, and if the money is not needed, then he most certainly can say: “thanks but no thanks”. Imagine the great sound bite he would get by saying, “no, we got this. use the money to pay down the debt.”

        Finally, a BILLION dollars just disappeared under the Bush administration in IRAQ. Money sent there, and poof, it was gone. Where was your outrage for that? But send a billion to help students in our own country, and the “fiscal” hawks are pounding their desks in disgust.

        Peace.
        Rick Beagle

      • Jack Clark says:

        Actually it is a wise expenditure since the prior administration at the time did such a piss poor job of handling a situation that was already botched from the start.

        I’m not going to be a whining wuss like Money Beagle, but TML a lot of your posts smack of a serious double standard.

        You asking Rick that question is like me asking you if it’s a wise expenditure of our tax dollars to spend Billions for Medicare, Medicaid, SSI, and Medicare Part D for Tennessee where your obesity rate is either the highest or second
        highest in the nation?

        Do I want to pay for that? Hell no.

        But at least I understand that some things need to be done for the common good or for the well being of others when they can’t help themselves. And the NO situation was not handled even close to correctly five years ago and if it takes another 1.8 to make that area better than so be it.

        Like Rick said, where should people be allowed to live?

        Between Tornadoes, Earth Quakes, Fault Lines, Hurricanes, Extreme Ice, Snow, or Heat is anywhere safe enough so that your precious tax dollars don’t have to get spent on others.

        I mean you’re fairly close to Tornado Ally and Tennessee picks up its fair share of Tornadoes.

        Should my tax dollars be spent to force you to move because of a G4 or G5 that may never happen? (Just like Katrina II.)

        • Jack: You still haven’t convinced me that spending billions to further protect a city that shouldn’t even be there is a wise expenditure. Houses built directly on the ocean on the eastern seaboard are washed into the sea every year due to natural, unavoidable erosion. The federal government is not protecting or rebuilding those homes.

          Your tornado argument is not logical. Yes tornadoes are inevitable in my part of the country. I can choose to live here. Because I have, how about you send $15 billion to Tennessee so that we can build tornado-proof homes just in case? By the way, Tennesseans are not permitted by state law to build homes inside 100 year flood plains, of which we have many. The entire city of New Orleans is a flood plain.

          I have no problem with my money being spent on emergency post-disaster relief for large scale natural disasters like Katrina but not to act as insurance company or to build a fortress against the inevitable.

          • Jack Clark says:

            “The federal government is not protecting or rebuilding those homes.”

            Sure they are Federal, State, and Local Governments.

            Check out of much money is spent on off shore dredging and beach replenishment annually to protect coastal homes.

            In New Jersey around Ocean City alone they are spending two million dollars per mile of beach. Florida has spent a half a billion dollars over the last decade.

            http://www.cbsnews.com/stories/2009/05/26/eveningnews/main5041144.shtml

            http://www.heraldtribune.com/article/20100313/ARTICLE/3131022

            All of those homes are in unsustainable areas. But because a whole lot of those residents are wealthy and well connected they get something like the people in Cape May, New Jersey which has had their beaches replenished 24 times.

            I don’t hear any loud cries to get people off the beaches and to stop the free money for that group of homeowners.

            “Your tornado argument is not logical. Yes tornadoes are inevitable in my part of the country. I can choose to live here.”

            My tornado argument is logical TML.

            Just like you can choose to live in a Tornado-prone area with the inherent risks associated with that and no one is asking you to leave. (And if a disaster were to happen, God forbid, you and everybody else would get aid and assistance from FEMA and other agencies.) No one is asking the residents of FLA to leave or at least leave the coastal areas when they get hit with the hurricanes and massive beach erosion every year.

            If the residents of tornado alley or tornado prone areas that get hit with G4’s and G5’s annually aren’t forced to move, and residents of coastal areas get that get hurricanes and massive beach erosion aren’t forced to move, why should everybody in NO move?

            It’s the same principal. Each group gets direct and indirect government assistance every year into the hundreds of millions of dollars for early warning, radar, FEMA, and beach replenishment. Why is NO different?

            Spend the money to finish the job that Bush’s team never did; do it right and the city will be the better for it.

          • Jack Clark says:

            “The federal government is not protecting or rebuilding those homes.”

            Sure they are Federal, State, and Local Governments.

            Check out of much money is spent on off shore dredging and beach replenishment annually to protect coastal homes.

            In New Jersey around Ocean City alone they are spending two million dollars per mile of beach. Florida has spent a half a billion dollars over the last decade.

            All of those homes are in unsustainable areas. But because a whole lot of those residents are wealthy and well connected they get something like the people in Cape May, New Jersey which has had their beaches replenished 24 times.

            I don’t hear any loud cries to get people off the beaches and to stop the free money for that group of homeowners.

            “Your tornado argument is not logical. Yes tornadoes are inevitable in my part of the country. I can choose to live here.”

            My tornado argument is logical TML.

            Just like you can choose to live in a Tornado-prone area with the inherent risks associated with that and no one is asking you to leave. (And if a disaster were to happen, God forbid, you and everybody else would get aid and assistance from FEMA and other agencies.) No one is asking the residents of FLA to leave or at least leave the coastal areas when they get hit with the hurricanes and massive beach erosion every year.

            If the residents of tornado alley or tornado prone areas that get hit with G4’s and G5’s annually aren’t forced to move, and residents of coastal areas get that get hurricanes and massive beach erosion aren’t forced to move, why should everybody in NO move?

            It’s the same principal. Each group gets direct and indirect government assistance every year into the hundreds of millions of dollars for early warning, radar, FEMA, and beach replenishment. Why is NO different?

            Spend the money to finish the job that Bush’s team never did; do it right and the city will be the better for it.

          • Rick Beagle says:

            I guess what you don’t seem to understand TML is that this expense, and this disaster were all preventable. Unfortunately for NO the proactive and reactive elements of our then Federal, State, and Local governments failed the people living in that city.

            You also fail to comprehend that NO provides and has provided state and federal governments with their fair share of taxes. If you have a problem paying for this, merely imagine that the people of NO paid for this with their hard earned money. I will leave you to google how much tax revenue is generated by the city of NO every year. Not the cash cow that is California and New York, but amongst those pesky southern states, it is a solid anchor of revenue for the area.

            And again, there is a “fiscal conservative” in the governor’s mansion. So quit arguing with the liberals on this site, and use your blog to tell that governor, if the state and city do not need this money to continue rebuilding, send the money back.

            Just a lib snip, cause you know I have to: after watching the Beck rally yesterday, it was very obvious that we need to spend a helluva lot more on education, especially in the south.

            Peace.
            Rick Beagle

    • Oh and this is on top of the $15 billion the Army Corps of Engineers is spending to build 350 miles of levees and flood walls combined with 78 pumping stations and numerous emergency flood gates to help seal the perimeter of the city and its surrounding areas in the event of a major storm.

      The money would be better spent moving the residents to an area that is comfortably above sea level and not smack in the middle of the coastal Mississippi Delta. The entire city is an engineering and environmental disaster. Katrina II will eventually remind us of that.

      • Rick Beagle says:

        I imagine that your views extend to California as well? How about those of us sitting with St. Helens in our backyard? How about Florida and their hurricanes? Tornado alley? NYC is on a fault line due to split open any day now!

        Based on your comments, there isnt a place in the US that isnt foolishly placed in the middle of potential natural disaster.

        BTW The Army Corp knew that the levy that failed was a problem, and requested that it be updated (for a few million requested for several years). Guess who said no? Now the repair bill is in the billions.

        That stimulus money you keep railing about restored funding on the repairs for a lot of our infrastructure. Just thought you would want to mull that over.

        Peace.
        Rick Beagle

  3. MasterPo says:

    It has been well documented even by the media-at-large (like ABC and CBS) that the mayor of New Orleans and the then-Governor of LA *TOTALLY* dropped the ball on disaster planning and emergency preparedness. Even when the hurricane was less than 24 hours away no plans to use the thousands of yellow scholl busses to evactute residence was even thought about.

    But the people of New Orleans got creative and survived. Afterall, shaming store windows for plasma TV is bartering, not looting. 😉

    ps- Hey Ricky, just in case you didn’t see the other thread: I was at the Restoring Honor Ralley in DC yesterday and thought of you. :-)

  4. Rick Beagle says:

    “Hey Ricky, just in case you didn’t see the other thread: I was at the Restoring Honor Ralley in DC yesterday and thought of you.”

    Hope you had a good time!
    Peace.
    Rick Beagle

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