Video: Hurricane spending fears

By Tom Costello Correspondent
NBC News
updated 9/28/2005 7:31:04 PM ET 2005-09-28T23:31:04

In the port of Mobile, Ala., Wednesday sits the Holiday cruise ship chartered from Carnival Cruise Lines by the Federal Emergency Management Agency. In New Orleans, the Ecstasy and Sensation are docked, able to house thousands of Hurricane Katrina evacuees and first responders for up to six months.

The price tag?

$236 million, or $1,225 a week per evacuee. But the ships are less than half full.

“Since they're only half full,” says Tom Schatz of Citizens Against Public Waste, “they're really paying $2,500 per person, per week — almost four times as much as it would take to send the ship on a seven-day cruise!”

Carnival tells NBC News the price is “based on what Carnival would have earned during the charter period if the ships had been kept in regular cruise service.”

But government watchdog groups say that's the kind of poor planning that could cost billions.

On Wednesday, inspectors general from half-a-dozen government agencies promised lawmakers to keep an eye on what may be a tsunami of Katrina-related spending and no-bid contracts.

“We're stepping back,” says the Department of Homeland Security’s Inspector General Richard L. Skinner. “And we are going to be looking at all of those no-bid and even those limited-competition contracts."

Already, lobbyists are working the halls of Congress, trying to squeeze pet projects into Katrina legislation.

For example, Louisiana wants $250 billion. That includes:

  • $8 million for alligator farms.
  • $25 million for a sugar cane research lab.
  • $35 million to market seafood.
  • $50 billion in open-ended grants.

“We may be up to $200 billion," says Rep. Jay Inslee, D-Wash. “It's critical that we protect these funds from fraud, waste and abuse.”

On Wednesday, the governors of the affected states and a few senators were urging quick action.

“I don't want to waste money,” explains Sen. Trent Lott, R-Miss. “But I want compassion. And I want action now. Our people are hurting, and they need help.”

And there's more. From struggling airlines to oil and insurance companies, dozens — perhaps hundreds — of industries are looking for a piece of the pie in what may be the biggest government spending project ever.

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