Pressure Builds to Stop Disaster Profiteering
The Center for American Progress offers a good run-down on the no-bid contracts going out to administration-connected corporations in the wake of Katrina, making the clear connection to Iraq:
It's the same mindset that has governed the reconstruction efforts in Iraq, which have lined the pockets of politically connected corporate interests while leaving Iraqis with an infrastructure less capable than it was under Saddam Hussein.
CAP also notes that the General Accounting Office plans to audit Katrina-related contracts, although the GAO's attempts to rein-in contracting fraud and waste in Iraq hasn't had much impact.
Rep. Nancy Pelosi's (D-CA) proposal to set up an independent commission to monitor contracts is the best plan -- similar to the bi-partisan call for a new Truman Commission to monitor military contracts.
Today's Wall Street Journal (reg. req'd) also has a damning piece on post-Katrina contracting, including the use of "cost-plus" contracts which allow a company to run up virtually limitless "expenses" and stick taxpayers with the tab:
The Bush administration is importing many of the
contracting practices blamed for spending abuses in Iraq as it begins
the largest and costliest rebuilding effort in U.S. history.
The first large-scale contracts related to Hurricane Katrina, as in
Iraq, were awarded without competitive bidding, and using so-called
cost-plus provisions that guarantee contractors a certain profit
regardless of how much they spend.
Contracts for temporary housing have been awarded to politically
connected companies like Fluor Corp. and Bechtel National Inc., a unit
of Bechtel Group Inc., leading congressional Democrats to renew charges
of cronyism they first leveled when the firms won lucrative work in Iraq.