'Downright criminal.' That's the verdict of a report into New Orleans'
reconstruction, and the huge contracts handed to non-local firms
A year after Hurricane Katrina, the reconstruction of the devastated
Gulf coast is being severely hampered by waste and inefficiency overseen by
"disaster profiteers" who are making million of dollars, according
to a watchdog group. The group claims the inefficiency - along with the companies'
political connections - follows a pattern similar to what happened in Afghanistan
With much of New Orleans still in ruins and its population half of what it
was before the hurricane, a new report claims millions of dollars has been squandered
by wasteful processes that have seen 90 per cent of the first wave of reconstruction
contracts awarded to firms outside Louisiana, Mississippi and Alabama. Local
firms have been frozen out while immigrant workers have been exploited and often
"One year after the disaster, the slow-motion rebuilding of the region
looks identical to what has happened in Afghanistan and Iraq," said Pratap
Chatterjee, the director of Corpwatch. "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 favour of politically connected corporations
from elsewhere in the US that have used their clout to win lucrative no-bid
contracts with little or no accountability."
When President George Bush addressed America from floodlit Jackson Square in
New Orleans on 15 September last year, he said: "Our goal is to get the
work done quickly. And taxpayers expect this work to be done honestly and wisely....
And in the work of rebuilding, as many jobs as possible should go to the men
and women who live in Louisiana, Mississippi, and Alabama."
Yet the report details how the overwhelming majority of initial contracts for
construction went to companies - "usually large, politically connected
corporations - based outside these three states". Among the biggest winners
of contracts were Florida-based Ashbritt, which received a $500m contract; Bechtel
of San Francisco, which has received $575m worth; and Texas-based Fluor Corp
- $1.4bn. One Louisiana company that received a large contract was the Shaw
Group, which was awarded $950m worth.
There is no suggestion that any of these companies has acted illegally or stepped
outside acceptable commercial practice.
The report's author, Rita 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. Corporations are growing rich
off no-bid contracts while the sub-contractors [get] peanuts."
Another aspect highlighted is the failure to pay immigrant workers, who do
much of the reconstruction work. It details the efforts of the Mississippi Immigrants
Rights Alliance which has had to fight for $300,000 in wages owed to immigrant
Rosana Cruz of the National Immigration Law Centre said: "The level of
assault against workers feels like war. There is vulnerability in each successive
layer of sub-contracting. This is a microcosm of what is happening around the
world. If you're poor and you're brown we can do what we want with you."
Companies named in the report dismissed its findings. Bechtel quoted the Federal
Emergency Management Agency's (Fema) assessment of its work as "remarkable"
and said its rate of providing emergency housing was "faster than at any
time in Fema's history". It said 70 per cent of its sub-contracts went
to local firms.
A Fluor spokesman said it had provided temporary homes for 150,000 people and
had used 30 local vendors: "We are very proud of the work we have been
able to do in Louisiana."
Federal authorities have issued $9.69bn in Katrina reconstruction contracts.
The Department of Homeland Security's inspector general, Richard Skinner, told
Congress in April: "The federal government, in particular Fema, has received
widespread criticism for a slow and ineffective response. Unfortunately, much
of the criticism is warranted."
Golden Pyramid: How dust and debris turns into dollars
The report claims many large companies established 'contracting pyramids',
with each layer skimming money. It highlighted the $500m contract awarded to
Ashbritt to remove debris, which worked out at $23 per cubic metre of rubbish
moved. In turn, it hired C&B Enterprises to do the work for $9 per cubic
metre, which in turn hired Amlee Transportation which was paid $8 per cubic
metre. Amlee hired another company for $7 a cubic metre. Finally, the work was
done at $3 per cubic metre by a haulier from New Jersey.
Read from Looking Glass News
is Racism: An Update on the New Orleans Tragedy
Clears Way For New Orleans "Land Grab"
Levees vs. Our Levees
U.S. Government Saboteurs Involved In A Fatal Shootout With New Orleans Police
Officers On Sept. 4 At The Danziger Bridge?
Witnesses Living Near 17th St. Levee Say Loud Explosion Heard Just Prior To
Raging Waters Flooded 9th Ward
Took Part In New Orleans Looting, Witnesses Say
Are The 75,000 Body Bags For?
La. outsource Katrina body count to firm implicated in body-dumping scandals
Orleans SWAT Team Thugs Wear Flaming Skulls
Earwitness tells ABC explosives blew Industrial Canal levee
IN NEW ORLEANS" News Articles