Katrina’s Bigger Picture

This is the fourth in a series of five to help the Democratic Party, particularly its presidential hopefuls, to get the framework right, to broaden its lens through which it views Katrina, what’s stopping recovery, what will speed up a vibrant recovery, and how Katrina affords us the opportunity to transform the basic quality of life for all Americans.

Clearly, the Democratic debate on PBS hit a bit of a raw nerve with me. The debate question and candidates’ answers reflected the framework for our national discussion, which has been too narrow, too tiny when discussing who Hurricane Katrina impacted and what the impact was, as well as the solutions offered. So let’s put on a lens through which we can see Katrina’s bigger picture.

First, Hurricane Katrina itself destroyed the Mississippi Gulf Coast. However, the New Orleans disaster was another matter. As so aptly stated on Levees.org, “New Orleans was destroyed primarily by bad engineering and not bad weather.”

Moreover, “[r]esponsibility for the levee failures on August 29, 2005, in New Orleans rests squarely on the U.S. Army Corps of Engineers and on Congress. This means that the federal government bears primary responsibility for the flooding of metro New Orleans and the destruction of hundreds of thousands of homes and livelihoods.”

When Hurricane Katrina breached the levees in New Orleans, the floods indiscriminately drenched Republican and Democratic, wealthy, middle class, and low income homes and neighborhoods as well as every ethnic group in this international city. However, had the U.S. Army Corps of Engineers carried out its responsibilities, these New Orleans residents would have been spared this horrendous flood. To carry out their responsibilities, of course, requires financial resources as well as solid policy based on sound engineering and environmental principles.

The Washington Post reported

Bush repeatedly requested less money for programs to guard against catastrophic storms in New Orleans than many federal and state officials requested.

When disclosures like this came out in Katrina’s immediate aftermath, the Army Corps of Engineers defended the Bush Administration. "It was not a funding issue," said Carol Sanders, the chief spokeswoman for the corps. "It's an issue of the design capabilities of these projects." What a disingenuous though unsurprising answer since the Corps “worked closely with White House officials” on the responses to these tough, important questions regarding the Bush Administration’s responsibility in deliberately cutting the corps’ budget.

The Washington Post article continued.

Local and federal officials have long warned that funding shortages in the New Orleans area would have consequences. They sounded the alarm as recently as last summer [meaning 2005] when they complained that federal budget cuts had stopped major work on New Orleans east bank hurricane levees for the first time in 37 years. Al Naomi, the senior project manager for the Army Corps of Engineers, reported at the time that he was getting only half as much money as he needed and that much of the funding was being used to pay contractors for past work.

"When levees are below grade, as ours are in many spots right now, they're more vulnerable to waves pouring over them and degrading them," Naomi told the Times-Picayune of New Orleans. Walter Maestri, the emergency management chief in Jefferson Parish (county), at the time linked the funding shortfall to the cost of the Iraq war. "It appears that the money has been moved in the president's budget to handle homeland security and the war in Iraq, and I suppose that's the price we pay," he told the newspaper. Maestri added, "For us, this levee is part and parcel of homeland security because it helps protect us 365 days a year."

Indeed, if this city had had the kind of protection that the Netherlands has, my family members who live in the Big Easy would have had it easy after the storm. Here are pictures that demonstrate the difference between the levees in New Orleans and those in the Netherlands.

New Orleans Levees
Photos by National Geographic.

The repaired Industrial Canal levee wall in New Orleans' Lower Ninth Ward is green with new turf in July 2006 (top). The U.S. government says the city's levees are back at pre-Katrina conditions.A school bus sat stranded near a breach in the same levee on September 12, 2005 (bottom). The embankments were built to endure Category Three storms, yet several crumbled after Katrina's Category Three assault, perhaps as a result of poor design and construction.

Mario Tama / Getty Images file
Workers rebuild the levee along New
Orleans' Industrial Canal in the Lower
Ninth Ward

Netherlands Levees











Photo Credit: By Molly Moore -- The Washington Post Photo
Ted Sluyter, who organizes school tours of the Dutch sea defense system, says the calamitous 1953 flood bears clear parallels to the New Orleans disaster.

U.S. Senator Mary Landrieu (D-LA) led a 40 member delegation from Louisiana to the Netherlands to tour the world's largest levee system.

"When the unprecedented disasters of Hurricanes Katrina and Rita, and the subsequent levee breaks struck Louisiana, the Netherlands was one of the first nations to come forward to offer their support," Sen. Landrieu said. "The Dutch know all too well the challenges we face, having lived for centuries under the threat from similar vulnerability themselves."

Protecting a world class city like New Orleans with a world class levee system like the Dutch have is what we need to do to protect this national treasure. A Netherlands-type of levee system will protect residents, neighborhoods, and businesses in New Orleans. That’s what homeland security is about. It is the smart, savvy, and environmentally sound thing to do. Plenty of good jobs and spin-off business will come from investing in this.

The wider view is that our nation will once again be demonstrating a commitment to investing in the best here at home for our own people, using information rooted in scientific fact.

The wider view still is something I learned from Levees.org. Twenty eight (28) states have at least 120 levees that are vulnerable to the same catastrophic failure New Orleans experienced. One hundred and twenty potential government-created environmental and economic disasters?! Holy Moly!

The spin off benefits of this kind of a levee system will be fantastic. What an awesome boon to our educational system alone with a renewed national commitment to math, science, and technology. Remember the seven-year old African American girl whom I had met at the Bay St. Louis library? She had proudly shared with me that she gets “A’s in math and science!”

With these kinds of projects in 120 areas across the country, little girls and boys in the surrounding areas would grow up with dreams of being engineers and scientists who work at world class facilities just down the street. This is a way we build great communities in which families can live, work, and play generation after generation after generation. What a concept, huh?!

Through the lens of the Katrina travesty, we have learned that we need to reform our national priorities to invest in world class levees in over half the states in our nation. We have also learned of another national problem requiring a national solution. Insurance carriers are jacking up premium costs or not covering homeowners here in Katrina Land . . . and all across the country.

Broadening Katrina’s Lens:
A five Part Series
Part 1: Broadening Katrina's Lens
Part 2: Recovery’s Two Major Impediments: $$$ and the “F” word
Part 3: The "F" Word: FEMA
Part 4: Katrina’s Bigger Picture
Part 5: Katrina’s Karmic Payback: Insurance Reform

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Recovery’s Two Major Impediments: $$$ and the “F” word

This is the second in a series of five to help the Democratic Party, particularly its presidential hopefuls, to get the framework right, to broaden its lens through which it views Katrina, what’s stopping recovery, what will speed up a vibrant recovery, and how Katrina affords us the opportunity to transform the basic quality of life for all Americans.

Our recovery has two speeds: s-l-o-w and s—l—o—w—e--r. One reason is a lack of money both from the insurance companies and from FEMA. Today, we’ll talk about money and the insurance industry.

Tomorrow, we’ll talk about the other reason for this unacceptably s-l-o-w recovery: the abysmal lack of appropriate and innovative leadership from those sitting in our White House. Hands down, there is no better example of this than Bush’s FEMA. But we’ll just have to wait ‘til tomorrow to skewer that subject.

Money
Money would solve nearly all of the problems we face in reviving our lives, jobs, communities, cities, and region and to do so in innovative ways so that we protect the wetlands throughout the region while implementing a world class environmentally sound levee system like that in the Netherlands.

Money will help us to recover in a way that adopts the best of the best practices for everything from low income housing to public education. Rather than the painfully s-l-o-w way experienced since Bush finally decided to end his infamous month long vacation a few days after Katrina ravaged the area, money will infuse the area with much needed cash . . . and infuse the area with a much needed emotional and psychological lift in spirits.

We need money to rebuild the infrastructure of our cities for things like roads, firehouses, school buildings, drains, street signs, stop lights, stop signs, and light posts. We need money to rebuild public buildings such as court houses, city halls, and other government offices Katrina destroyed.

Businesses need money to rebuild their buildings and replace the contents inside of those buildings.

Families need money to rebuild their homes whether those homes were in the 9th Ward at one end of the economic spectrum or in Lakeview, a New Orleans neighborhood at the other end of the economic spectrum. Families need money for their homes located in Slidell, Louisiana, which is just east of New Orleans or Long Beach, Gulfport, Biloxi, Ocean Springs, and Pascagoula, Miss., on the far east of the Mississippi Gulf Coast. Money is needed to completely rebuild the towns of Pearlington, Waveland, Bay St. Louis, and Pass Christian, Miss.,— each of which Katrina wiped clean and which comprise Katrina’s ground zero. (Yes, Katrina’s ground zero was in Mississippi, about 60 miles or so east of New Orleans.)

Money will help the Katrina region retain the dignity of its residents be they a disabled veteran, a senior citizen, a working class laborer, a computer geek, hair dresser, janitor, teacher, nurse, doctor, realtor, oil rig worker, etc. and so forth.

A major bottleneck for getting money to where it needs to go rests with Bush’s FEMA and the insurance companies. We certainly pay plenty enough taxes to expect FEMA to be here pronto stat when we need the agency to help communities, businesses, and families get back on their feet. We don’t expect amateur hour or some version of “Whose job is it anyway?” to be played.

We expect insurance companies to own up to their financial obligation and promptly pay on the wind insurance policies when its customers appropriately submit claims. We need that kind of confidence in our financial markets. Insurance companies are part of our financial security be it for our health, car, life, or home.

If we are going to insure what is clearly the greatest financial asset for most American families—our homes, then we must have insurance entities in whose hands we have complete confidence and on which we can depend–just like a good neighbor.

The way that insurance companies have turned their backs on the very customers who have paid the premiums that created the industry’s $108 billion profit in 2005 and 2006, they ought to be ashamed of themselves. Their greed is downright sinful, and the means by which the companies attained their wealth seems criminal. As a result of failing to pay on the legitimate wind claims, families and businesses cannot return to their homes, livelihoods, communities. What’s happening here is not unique except in its scope.

Private insurance companies are raising rates to astronomical levels for significantly less coverage for commercial and residential policies. They are also choosing to stop writing new policies not just here along the Gulf Coast but also all over the country from the West Coast to the Mid-West to the East Coast.

The private companies have not just failed us but also are deliberately abandoning American families and businesses everywhere just as it did in the 60’s with regard to flood insurance. The private sector simply begged off of it. That is the reason that the federal government stepped up to the plate and began its flood insurance program in 1968. And so it is again with Gulf Coast Congressman Gene Taylor’s proposed Multiple Perils Insurance Act of 2007 to include windstorms, floods and other purposes in the Federal Government’s Flood Insurance Program. The insurance industry’s insatiable insanity demands we act quickly to protect our families, our homes, and our businesses.

The Insurance Industry’s Insatiable Insanity

Insurance Company Documents

Nationwide on 9/4/2005: “if loss is caused by both flood and wind there is no coverage.”

State Farm instructions to adjusters on 9/13/2005: “where wind acts concurrently with flooding to cause damage to the insured property, coverage for the loss exists only under flood coverage.”

The documents from which the above excerpts have been taken, certainly appear to indicate that the insurance companies have deliberately directed its workers to refuse to pay legitimate claims from its policyholders. No wonder we need to pass the Multiple Insurance Act of 2007! (For more information on these documents, read Wind? Water? More like a bunch of hot air!)

When these private companies refuse to own up to their financial responsibilities, who do these companies stiff with their financial tab? That’s right! The federal government’s flood insurance program and policy holders like you and me.

The federal government contracts with the private insurers to adjust the claims for the federal insurance program. The private companies send the bills to Uncle Sam’s insurance program for payment. That sounds all fine and dandy until something like Katrina hits and the insurance industry ends up in a position where it determines whether to pay the full amount of wind damages for which it is fully responsible or to shift its own costs to the U.S. taxpayers through pushing off claims to Uncle Sam’s federal flood insurance program.

This is an obvious conflict of interest that Gulf Coast Congressman Taylor proposes to remedy with passage of the Multiple Perils Insurance Act of 2007. The amount of damages not covered by the flood insurance are born by the policy holders themselves. There are two reasons for this. First, for those permitted to buy flood insurance, the policy severely limits coverage and whenever damages exceeded the limits, those costs were then shifted to the policyholders themselves.

Secondly, many businesses and homeowners were prohibited from buying flood insurance because their homes and/or businesses were not in a flood zone. So when an insurance carrier wrongfully (and deliberately) asserts that the damage came from flooding and not from wind, the policyholder is left to finance the damages.

We can participate in stopping these financial shenanigans. We can do our usual political hell raising to make this a legislative reality for our families and businesses all across the country. Call or email your congressional representative to voice your support for Taylor’s Multiple Perils Insurance Act of 2007. The bill will be discussed in the next few weeks when the Flood Insurance Program comes up for reauthorization. Click on the hyperlink to go to a page with a sample email and phone script you are free to use as you desire. There is also a link to find your representative’s contact information. Just let your fingers do the walking.

Congress Dems and the Katrina Task Force
As far as I’m concerned, Congressman Taylor is THE Congressional Democratic expert taking the lead on Katrina recovery. When the Democratic Caucus created a Katrina Task Force right after the hurricane hit, Taylor stepped up to the plate to chair it. The task force has issued an 18 page report of legislative recommendations. Katrina and Beyond: Recommendations for Legislative Action which included the following.

1. Investigate the Katrina claims practice of insurance companies that contract with the National Flood Insurance Program.
   
2. Repeal the federal antitrust exemption as it relates to price-fixing, bid-rigging, or market allocation in the market for property insurance.
   
3. Establish all-perils disaster insurance coverage backed by the federal government.
   
4. Rebuild levees and flood controls to higher standards.
   
5. Relieve FEMA of its recovery mission and reassign those responsibilities to the appropriate federal agencies.
   
6. Reform FEMA contract procedures to eliminate cost-plus noncompetitive contracts.

These are practical steps to remove the barriers to returning home and rebuilding communities and cities after natural disasters such as Katrina.

The staff of NPR and the Democratic presidential hopefuls would do well to call Taylor’s office to talk with even the most junior member on staff whom I am certain can cite chapter and verse of what is wrong and how to solve the problems. Senator Mary Landrieu (D-LA) who was raised and has strong family roots in New Orleans, is also a strong leader in Katrina recovery. Her office is surely to goodness another fabulous resource that researchers should tap for real-time information and solutions that address problems stemming from Katrina.

Preventing Collusion in the Insurance Industry
Closing the insurance industry’s loophole on anti-trust laws is another solution to the problems we’ve uncovered down here. The goal is to make it so that the insurance companies cannot engage in such things as price fixing or bid-rigging. At present, they are only one of two industries allowed to engage in any of these things and to do so with impunity as far as the law is concerned.

Let’s think about this a minute. Here at Katrina’s ground zero in Bay St. Louis, Miss., we’re in the middle of casino country. Can you imagine how many customers casinos would have here or in Vegas if they rigged everything and wouldn’t pay out the winners? Casinos don’t engage in this behavior, because the industry is regulated like crazy, as it should be. We need insurance reform to protect American families and businesses in both the property and casualty and health care insurance arenas. Insurance reform is a bread-and-butter issue for families and small businesses that the Democratic Party should immediately embrace and aggressively push.

The Senate’s Democratic Leaders have put together legislation (S.618) to strip the insurance companies of its 62-year old exemption from the nation’s anti-trust laws. U.S. Senators Mary Landrieu (D-LA) and Trent Lott (R-MS) are among its four co-sponsors. To close the loophole, click here for delightfully fun political hell raising activities. Turning up the heat is as easy as cutting and pasting into an email and reading a script into your phone. It’s hot as you-know-what down here in Katrinaville. Let’s help Washington DC feel the heat.

Between the increase in health care costs and increases in insuring our homes—in those areas of the country where we can still purchase it, this bread-and-butter issue is ripe for the Democratic Party to embrace and run on to expand its control of Congress and to recapture the White House. One or both of these areas impact each American some way or another. It’s certainly an issue that hits home with most folks, as long as we articulate our framework in a way that is smart, savvy, and sophisticatedly simple.

Broadening Katrina’s Lens: A five Part Series
Part 1: Broadening Katrina's Lens
Part 2: Recovery’s Two Major Impediments: $$$ and the “F” word
Part 3: The "F" Word: FEMA
Part 4: Katrina’s Bigger Picture
Part 5: Katrina’s Karmic Payback: Insurance Reform

Return to A.M. in the Morning! Home

Read More......