A little background. FEMA has an operational budget for their day-to-day needs, and a Disaster Relief Fund (DRF) for their disaster costs (individual assistance, public assistance, reimbursements, et al). The DRF is funded annually by Congress in an amount equal to a historical average of disaster costs. Generally, the DRF has anywhere from $1 billion to $20 billion in it for on-going disaster relief. Some projects funded by FEMA may take years to complete (bridge or highway rebuilding, retrofitting of public buildings, etc.). The money in the DRF is fungible, meaning that while dollars may be allocated for a specific project, those same dollars might be actually spent on a different project whose bills come due before the other project. So even though FEMA may have already allocated some money for a project, those dollars might not actually be spent yet because the bills haven’t yet become due. That is the current controversy. The DRF is low on money, so FEMA has invoked its “immediate needs funding” policy which says we pay current bills only, and defer other spending on other disasters until those bills come due.
Congress has not passed a budget in several fiscal years. The feds are operating on a continuing resolution which means you spend what was spent last time, nothing more, nothing less. It is an awful way to do business, but Democrats – and now Republicans – are failing to put together a federal budget. So, when FEMA’s DRF runs low, the agency can only spend what it has – thus the immediate needs funding to make sure what money they do have is spent on current bills. It’s similar to a family looking at the checkbook, saying here are the bills, here’s how much money we have, what do we pay first?Then comes Irene, and the debate begins.
Governor Chris Christie of New Jersey has been an outspoken critic of out of control government spending. He has taken on unions, teachers, pensioners, police, fire and other spenders of tax dollars in a way unlike most conservatives. He has actually put his money where his mouth is and cut spending, getting the New Jersey state budget under control. He has been heralded as a fiscal conservative and a potential GOP presidential candidate. He’s known for his tough language when it comes to cutting budgets:
Now let’s not start going down that road, I’m not going to be answering every one of these. Because we can’t afford it. The reason, by the way, that I cut every one of these is we can’t afford it. I’d love to do it. I’d love to do most of the things they put in there.
Eric Cantor, Congressman from Virginia, and House Majority Leader, recently provided a reality check during an interview on Fox News:
Speaking on Fox News Channel, House Majority Leader Eric Cantor said a natural disaster like Hurricane Irene is an “appropriate instance” for a federal role, but that the government can’t go deeper into debt to pay for unexpected outlays.
Succinctly stated, Mr. Majority Leader. Every dollar that FEMA spends, almost half must be borrowed – from investors ranging from the Chinese, to the Brits, to the Federal Reserve, to pension funds. The federal debt is why we’re in the fiscal mess we are. No one wants to cut anything, and Governor Christie, the fiscal conservative idol of many Republicans, revealed that inherent difficulty today:
Our people are suffering now, and they need support now. And they (Congress) can all go down there and get back to work and figure out budget cuts later…Nobody was asking about offsetting budget cuts in Joplin.
Yes, people are suffering, but what, if any, is the appropriate role of the federal government in a natural disaster? Should it pay for people’s rent for temporary housing? Should taxpayers in Tampa, Florida, pay for Denver, Colorado, to remove a record snowfall? Should taxpayers all across the country provided every person in a disaster area, whether they’re actually hurt or not, with ice and water? What’s the role of the federal government versus the role of state government in “ordinary” or “routine” disasters like Hurricane Irene? Is Irene routine, while Katrina catastrophic? Or is a catastrophic disaster only those where hundreds of thousands are without housing, such as an earthquake taking out Los Angeles?
What should the American taxpayer pay and what should a state taxpayer pay? Let’s have that debate.
Chris Christie has shown that even a conservative Republican is susceptible to the emotional draw of fellow citizen suffering. But, as Eric Cantor has said, what is the role of the federal, versus the state government, in helping that suffering citizen? These two Republicans show how difficult the debate will be. But, it is a debate sorely needed.