[NYTr] Big, Easy Money: Katrina 2 Years Later

[All the News That Doesn't Fit]

Corporate Watch - Aug 17, 2007
http://www.corpwatch.org/article.php?id=14023

Big, Easy Money

Disaster Profiteering on the American Gulf Coast

Disaster profiteers make millions while local companies and laborers in
New Orleans and the rest of the Katrina-devastated Gulf Coast region
are systematically getting the short end of the stick, according to a
major new report from the nonprofit CorpWatch.

A CorpWatch analysis of FEMA's records shows that "fully 90 percent of
the first wave of (the post-Katrina reconstruction) contracts awarded -
including some of the biggest no-bid contracts to date -- went to
companies from outside the three worst-affected states.  As of July
2006, after months of controversy and Congressional hearings, companies
from Louisiana, Mississippi and Alabama had increased their share of
the total contracts to a combined 16.6 percent."  The CorpWatch
analysis shows that more federal reconstruction contracts have gone to
Virginia and Indiana - usually large, politically connected
corporations -- than to any of the three Katrina-devastated states.

The CorpWatch report also exposes abusive "contracting charge pyramids"
where the companies doing the actual reconstruction work often get only
a tiny (and insufficient) fraction of the taxpayer money awarded for
projects and widespread non-payment of local companies and laborers,
including what has been alleged to be the deliberate and systematic
exploitation of immigrant workers, including undocumented individuals.

“One year after disaster struck, the slow-motion rebuilding of the Gulf
Coast region looks identical to what has happened to date in
Afghanistan and Iraq. We see a pattern of profiteering, waste and
failure - due to the same flawed contracting system and even many of
the same players" says CorpWatch Director Pratap Chatterjee. "The
process of getting Katrina-stricken areas back on their feet is
needlessly behind schedule, in part, due to the shunning of local
business people in favor of politically connected corporations from
elsewhere in the U.S. that have used their clout to win lucrative
no-bid contracts with little or no accountability and who have done
little or no work while ripping off the taxpayer."

“Big, Easy Money” report author Rita J. King said:  "The devastation of
the Gulf Coast is tragic enough, but the scope of the corporate greed
that followed, facilitated by government incompetence and complicity,
is downright criminal. Sadly, disaster profiteering has become
commonplace in America. Well connected corporations are growing rich
off of no-bid contracts while the sub-contractors - the people who
actually perform the work - often do so for peanuts, if they get paid
at all."

Click here to read the report (text version), 
http://www.corpwatch.org/article.php?id=14004

to see key findings, 
http://www.corpwatch.org/article.php?id=14028

or to download it as a PDF (1.75 MB).
http://www.corpwatch.org/downloads/Katrina_report.pdf

For more information, call Patrick Mitchell at the Hastings Group, +1
703 276 3266 or pmitchell[at]hastingsgroup.com

Pratap Chatterjee, +1 510 759 8970 (mobile phone) or +1 510 271 8080.
Email: pratap[at]corpwatch.org