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Conservative Republican proposes massive government rebuilding plan

Rep. Richard H. Baker (R-Baton Rouge) has proposed the "Louisiana Recovery Corporation" which would spend up to $80 billion to buy up property, pay off the banks, and the like: "A Big Government Fix-It Plan for New Orleans". It was passed over late last year, but Baker's hopeful it will be approved this year. Join the NYT as they spot conservatives in the mist:

...The passage of the bill has become increasingly important to Louisiana because the state lost out to the greater political power of Mississippi last month when Congress passed a $29 billion aid package for the Gulf states region. The package gave Mississippi about five times as much per household in housing aid as Louisiana received - a testimony to the clout of Gov. Haley Barbour of Mississippi, a former Republican National Committee chairman, and Senator Thad Cochran, chairman of the Appropriations Committee.
Louisiana officials say they were forced to go along with the appropriation, because they may not have received an aid package at all otherwise. But now they are focused even more intently on Mr. Baker's buyout bill; many economists here say there may be no alternative to buyouts for homeowners who cannot make mortgage payments on ruined properties...
Under his plan, the Louisiana Recovery Corporation would step in to prevent defaults, similar in general nature to the Resolution Trust Corporation set up by Congress in 1989 to bail out the savings and loan industry. It would offer to buy out homeowners, at no less than 60 percent of their equity before Hurricane Katrina. Lenders would be offered up to 60 percent of what they are owed.
To finance these expenditures, the government would sell bonds and pay them off in part with the proceeds from the sale of land to developers.
Property owners would not have to sell, but those who did would have an option to buy property back from the corporation. The federal corporation would have nothing to do with the redevelopment of the land; those plans would be drawn up by local authorities and developers...

Bush is interested, but his rebuilding czar Donald E. Powell isn't so convinced. However, Walter Isaacson's Louisiana Recovery Authority supports it, as do many... Democratic politicians. On the other hand, it was "shunned by many conservatives" in the House.

WaPo on NO's history of poverty and corruption

From this:

Huge stretches of the city are fallow: no power, no water, no sewer system, no life. Half the city workforce has been laid off, not a single public school is open, and the police department is being run by an acting chief after its former head quit. Mayor C. Ray Nagin is forced to hold town hall meetings in Baton Rouge, 70 miles away.
The litany of problems faced by New Orleans in the aftermath of Hurricane Katrina is unmatched by any other U.S. city in recent history. Billions of dollars in public and private funds are going to be spent on rebuilding New Orleans, but those efforts could be undermined by forces that have long beset the city -- a tradition of corruption and dysfunction and a weak economy that clouded New Orleans's future years before the rains began in August.
"Always broke. Worst school system in the state. Highest crime rate in the nation. Shrinking population. All the corporations have moved out," said Bernie Pinsonat, a political analyst in Baton Rouge. "Any poll I do, the rest of Louisiana thinks, 'New Orleans is a deep, dark hole, and no matter how much money we send, it doesn't seem to get better.' "
...The blue-ribbon commission he appointed to help with reconstruction is rife with internal squabbles, some of them racial, and with fears it could be reduced to irrelevancy because of the state government's own commission and the recent appointment of Donald E. Powell, chairman of the Federal Deposit Insurance Corp., to oversee federal relief work. "We're kind of a work in process," Nagin said during a recent interview...
...In a recent Louisiana State University poll of 419 business executives, corruption was ranked among the worst aspects of doing business in Louisiana. Investors and managers elsewhere are reluctant to come "because they don't want to pay the corruption tax," said Rafael C. Goyeneche, president of the Metropolitan Crime Commission.
"We've seen every type of corruption imaginable," said U.S. Attorney Jim Letten, whose office indicted 44 public officials in the past fiscal year alone. He pointed to skimming, bribery and shakedowns across a spectrum of government employment: judges, police, teachers, administrators and traffic court workers...

Rebuilding czar: FDIC Chairman Donald Powell

Federal Deposit Insurance Corporation Chairman Donald Powell - a "longtime friend and political supporter of President Bush" - has been appointed to lead the Gulf Coast rebuilding effort, aka the Rebuilding Czar:

According to the Department of Homeland Security, as coordinator, Powell will serve as the administration's primary contact with Congress, state and local governments, the private sector and community leaders on mid- and long-term recovery plans. He reportedly will report to President Bush through Chertoff.
Powell also will help direct the spending of federal aid money...

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Rebuilding czar considered

From this:

...Republican Senator Judd Gregg of New Hampshire and Democrat Ted Kennedy of Massachusetts said today that they have introduced legislation to create a federal agency to oversee the recovery. The director of the agency, appointed by the president and confirmed by the Senate, would oversee all federal resources involved in the recovery effort, under the legislation.
``We must provide an accountable structure for ensuring that these taxpayer dollars are spent wisely and in a systematic way,'' Gregg said in a statement.
Bush said Sept. 26 that a federal reconstruction czar is ``an idea that I'm still considering.''

Katrina Rebuilding Czar considered

Developing...

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