Hurricane Katrina: Profiteering

"As recovery on the Gulf Coast morphs into reconstruction, the federal government will be handing out billions of dollars in contracts," Michael Hiltzik wrote in the September 12, 2005, Los Angeles Times.

"Who will reap this bonanza?," he asked. "Not the people employed to remove wreckage, build houses and restore the infrastructure. While Congress was appropriating nearly $52 billion in relief and reconstruction programs last week, Bush quietly suspended the Davis-Bacon Act in the flood region. This law mandates that workers on federal construction projects be paid at least the prevailing local wage. ... The disaster entrepreneurs, meanwhile, are already saddling up."

"Those no-bid, cost-plus contracts already being dealt out to the usual suspects tell you what you need to know about future cost-overruns, klepto-reconstruction activities, and the like which are practically guaranteed to deconstruct the bulk of the Gulf Coast and leave New Orleans, the destroyed parts of Mississippi, and the hundreds of thousands of evacuees, not to speak of Congress, gasping for breath amid a landscape largely sucked dry, not of water, but of cash and sustenance." --Tom Engelhardt and Nick Turse, TomDispatch, September 13, 2005.

Profiteers
The following are companies or individuals who have been identified as profiteering from Hurricane Katrina.


 * Bechtel National Inc. unit of San Francisco-based Bechtel Corp.
 * CH2M Hill
 * Dewberry Technologies
 * Fluor Corporation
 * Intelsat
 * Joe M. Allbaugh (lobbyist for KBR/Halliburton)
 * Kellogg Brown and Root Services unit/Halliburton subsidiary (Allbaugh client)
 * Kenyon Worldwide Disaster Management is "the sole private company on retainer with the U.S. government to respond to disasters and help manage events causing a catastrophic loss of life."
 * Kenyon Worldwide Disaster Management, "a wholly owned subsidiary of SCI Corp., 'the largest provider of funeral, cremation, and cemetery services in North America.' SCI Corp is owned by major Bush contributor and friend Robert L. Waltrip, who was at the center of the scandal known as 'Funeralgate'." Thanks to News Hounds.


 * Segovia
 * The Shaw Group, Inc. (Allbaugh client)

Bush Proclamation on Suspending Minimum Wage
President Bush [http://www.whitehouse.gov/news/releases/2005/09/20050908-5.html signed] a proclamation September 8, 2005, which suspended the minimum wage -- "Within a Limited Geographic Area in Response to the National Emergency Caused by Hurricane Katrina" -- on "every contract in excess of $2,000, to which the Federal Government or the District of Columbia is a party, for construction, alteration, or repair, including painting and decorating, of public buildings and public works of the Government or the District of Columbia that are located in a State or the District of Columbia and which requires or involves the employment of mechanics or laborers shall contain a provision stating the minimum wages to be paid various classes or laborers and mechanics. ...

"And, as to such contracts to be performed in such jurisdictions, I do hereby suspend, until otherwise provided, the provisions of any Executive Order, proclamation, rule, regulation, or other directive providing for the payment of wages, which provisions are dependent upon determinations by the Secretary of Labor under section 3142 of title 40, United States Code."

This includes: 6 counties in Alabama, 3 counties in Florida, 65 parishes in Louisiana, and 81 counties in Mississippi.

2005

 * Lolita C. Baldor, "Halliburton Subsidiary Taps Contract For Repairs," Washington Post, September 4, 2005: "The subsidiary, Kellogg, Brown & Root Services Inc., won the competitive bid contract last July to provide debris removal and other emergency work associated with natural disasters."
 * "Price Increases in the Aftermath of Hurricane Katrina: Authority to Limit Price Gouging," Congressional Research Service, September 2, 2005; posted by Federation of American Scientists.
 * Timothy Noah, "Joe Allbaugh, Disaster Pimp. 'I don't buy the revolving door argument,' said Bush's former FEMA chief," Slate, September 7, 2005.
 * Max Blumenthal, "Pat Robertson's Katrina Cash," The Nation, September 7, 2005: "With the Bush Administration's approval, Robertson's $66 million relief organization, Operation Blessing, has been prominently featured on FEMA's list of charitable groups accepting donations for hurricane relief. Dozens of media outlets, including the New York Times, CNN and the Associated Press, duly reprinted FEMA's list, unwittingly acting as agents soliciting cash" for Pat Robertson.
 * "Bush Cohorts Profiteering at all levels," News Hounds, September 8, 2005.
 * "Fluor's slowed Iraq work frees it for Gulf Coast," Reuters, September 9, 2005.
 * "Firms with Bush ties snag Katrina deals," Reuters, September 10, 2005.
 * "Firms with White House ties get Katrina contracts. FEMA taps Halliburton subsidiary, Shaw Group, Bechtel for cleanup," CNN, September 10, 2005: "Shaw said on Thursday it has received a $100 million emergency FEMA contract for housing management and construction. Shaw also clinched a $100 million order on Friday from the U.S. Army Corps of Engineers. ... Shaw Group spokesman Chris Sammons said Allbaugh was providing the company with 'general consulting on business matters,' and would not say whether he played a direct role in any of the Katrina deals. 'We don't comment on specific consulting activities,' he said."
 * John Nichols, "Hurricane Halliburton," The Nation, September 11, 2005.
 * "Bush allies getting Katrina work. Companies with ties to the White House among the first awarded reconstruction deals," CNN "Money", September 12, 2005.
 * Michael Hiltzik, "A Perfect Time for Assessing Blame. The waters receding from a flood zone always leave exposed the unseemly reality lurking beneath the surface," Los Angeles Times, September 12, 2005.
 * Bill Berkowitz, "Joe Allbaugh's Moneymaking Mission to the Gulf Coast: Less than two weeks after Katrina devastated New Orleans and the Gulf Coast, the former FEMA head was on the scene to drum up business for his clients," Media Transparency, September 12, 2005.
 * Michael Hedges, "Daunting task: Houston company collecting remains," Houston Chronicle, September 12, 2005.
 * Tom Engelhardt and Nick Turse, "Corporations of the Whirlwind. The Reconstruction of New Oraq," TomDispatch, September 13, 2005.
 * "Slowness of recovery of Katrina dead criticized," Reuters, September 13, 2005: Louisiana's Governor Blanco "said she signed a contract with Kenyon International Emergency Services after the company threatened to pull out of the state for lack of a formal contract with anyone."
 * Miriam Raftery, "FEMA, La. outsource Katrina body count to firm implicated in body-dumping scandals," The Raw Story, September 13, 2005.
 * Charlie Cray, "Watch Who's Cleaning Up," Tom Paine.Common Sense, September 13, 2005.
 * Molly Ivins, "The Graft Goes On," AlterNet, September 14, 2005.
 * Jason Leopold, "FuneralGate. Corpse-Abusing Company Gets FEMA Contract," CounterPunch, September 15, 2005.
 * "Senators Ask Feds to Explain Katrina Cruise Contract," Associated Press (Fox News), September 29, 2005: "Sens. Tom Coburn, R-Okl., and Barack Obama, D-Ill., asked Homeland Security Secretary Michael Chertoff to explain why Federal Emergency Management Agency officials chose" to "sign a $236 million deal with Carnival Cruise Lines for Hurricane Katrina housing, saying Greece was ready to provide two ships for free. Carnival and turned down the Greek offer."
 * Griff Witte, Renae Merle and Derek Willis, "Gulf Firms Losing Cleanup Contracts. Most Money Going Outside Storm's Path," Washington Post, October 4, 2005.

2007

 * "New Orleans Pump Contract Investigated. Army Corps Copied Pump Maker's Specs In Bid, Gave $32M Contract To Politically Linked Company," Associated Press (CBS News), May 1, 2007. re Jeb Bush

Related SourceWatch Resources: Hurricane Katrina: List of related pages

 * In particular see Rebuilding the Gulf Coast in the wake of Hurricane Katrina: domestic policy initiatives.

Other SourceWatch Resources

 * FEMA contractors
 * Hurricane Katrina Price Gouging Probe
 * military-industrial complex
 * Project On Government Oversight (POGO)
 * war profiteering