$200 billion post-Katrina rebuilding effort planned

Jonathan Weisman and Jim Vandehei, Washington Post

September 15, 2005 KAT0915

WASHINGTON, D.C. -- President Bush tonight will call for an unprecedented federal commitment to rebuild New Orleans and other areas obliterated by Hurricane Katrina, putting the United States on pace to spend more in the next year on the storm's aftermath than it has over three years on the Iraq war, according to White House and congressional officials.

With the federal tab for Katrina already nearly quadruple the cost of the country's previous most expensive natural disaster cleanup, Bush plans to offer federal assistance to help flood victims find jobs, get housing and health care, and attend school, White House aides said.

In a primetime speech tonight from the flood zone, Bush will commit the federal government to what many predict will become the largest reconstruction effort ever on U.S. soil. Republicans said Karl Rove, the White House deputy chief of staff and Bush's chief political adviser, is in charge of the reconstruction effort.

Soaring costs

The president will call on Washington to resist spending money unwisely, but some in his own party are already starting to recoil at a price tag expected to exceed $200 billion -- about the cost of the Iraq war and reconstruction efforts. As emergency expenditures soar -- with new commitments as high as $2 billion a day -- some budget analysts and conservative groups are warning that the Katrina spending has combined with earlier fiscal decisions in ways that will wreak havoc on the government's finances for years to come.

Bush and Republican congressional leaders, by contrast, are calculating that the U.S. economy can safely absorb a sharp spike in spending and budget deficits, and that the only way to regain public confidence after the stumbling early response to the disaster is to spend whatever it takes to rebuild the region and help Katrina's victims get back on their feet.

"I think absolutely it's going to convert the political landscape in Washington," Sen. Olympia Snowe, R-Maine, said of Katrina's impact. "We do have a social safety net in this country. Those aren't just words. Government has a role to play in people's lives."

According to a CBS-New York Times poll released Wednesday, Americans say rebuilding New Orleans is more important to them than cutting taxes or changing Social Security.

On message

Bush, who prides himself on being a direct communicator, has struggled to convey a clear message since the storm hit. He began this week by dismissing questions about what went wrong as a "blame game." But on Tuesday, he said he took responsibility for any failures on the federal end.

Hours before Bush speaks, the Louisiana congressional delegation will present its tab for reconstruction and rebuilding efforts, which could put pressure on Bush to spend money in areas not currently on his agenda.

White House officials have told Congress that the $51.8 billion approved late last week will only get the disaster relief effort through the first week of October, and senior congressional appropriations aides have told the White House they need to see the next request next week. Republicans say the next bill could top $50 billion.

But the scale of the disaster has not even come into focus, largely because many agencies have not been allowed into the disaster zone to assess the damage, according to congressional appropriations aides.

Nearly 1,000 drinking water and sewer systems -- 391 in Mississippi, 606 in Louisiana and one in Alabama -- remain shut down. Repairing and rebuilding such systems could cost between $3 billion and $10 billion, much of it on the tab of the Environmental Protection Agency.

Even before Katrina struck, the federal highway emergency relief fund faced a $120 million backlog of road repairs. Between crumbled bridges and washed-out highways, the fund's deficit will be in the billions, said appropriations aides.

The Air Force will be seeking up to $4 billion to repair damaged Gulf State facilities, a House Appropriations Committee aide said. Another $2 billion to $4 billion will be needed to finance the mobilization of the National Guard, the evacuation of military personnel and military family support programs. Damage to national parks, forests and wildlife refuges are estimated to be as high as $300 million.

On Wednesday, the spending continued as the Senate approved a measure to provide emergency housing vouchers to more than 350,000 families made homeless by the hurricane. Any displaced family regardless of income would be eligible for the program, expected to cost $3.5 billion over six months.

The Associated Press and New York Times contributed to this report.