Did Katrina Victims Really Spend Their Relief Money on Gucci Bags and Massage Parlors?

Want to win an argument about an excruciatingly sensitive topic like, say, how best to aid the victims of Superstorm Sandy? Watch how Iowa Republican Steve King did it yesterday. Then do the exact opposite. 

King, who is running for a sixth term in the House against Democrat Christie Vilsack, was arguing that Congress shouldn't approve additional funds for relief efforts on the East Coast without a detailed spending plan from the government, in order to make sure the money doesn't go to waste. In the process, he let loose with the following aside about Katrina's Victims (per the Huffington Post):

"I want to get them the resources that are necessary to lift them out of this water and the sand and the ashes and the death that's over there in the East Coast and especially in the Northeast," King said during a Tuesday evening debate in Mason City, Iowa.

"But not one big shot to just open up the checkbook, because they spent it on Gucci bags and massage parlors and everything you can think of in addition to what was necessary," he said later, referring to Hurricane Katrina.

The phrase "Gucci bags and massage parlors" sounds frighteningly close to a dog whistle a la "welfare queens." Whatever his intention, though, it appears King was gesturing towards a substantive point. Over the disastrous course of its Katrina relief efforts through February of 2006, the Federal Emergency Management Agency (FEMA) handed out between $600 million and $1.4 billion dollars in "improper or potentially fraudulent" aid payments to actual Hurricane victims as well as con artists posing as them, according to a pair of reports by the Government Accountability Office (GAO). About 16 percent of the total disaster assistance payments were eaten up that way. People used fake addresses, social security numbers from prison inmates, and other ruses to collect cash from the government.

FEMA tried to speed up some of these payments to Katrina's survivors by handing out $2,000 debit cards, meant to cover basics like food and clothes. But, as the GAO dryly noted, "debit cards were used for items or services such as a Caribbean vacation, professional football tickets, and adult entertainment, which do not appear to be necessary to satisfy disaster-related needs as defined by FEMA regulations." 

Here are some of the more questionable purchases the GAO discovered:


Note the massage parlor, third from the bottom. Clearly, there were problems with this aspect of the relief effort, either because a few people were scamming the government for money they didn't really need or because they were simply making some dubious spending choices. (That said, I'm not sure I would begrudge anyone a post-Katrina beer). More questionable examples below.


Because the debit cards were mostly used to withdraw cash (as shown in the following pie chart) it was impossible for the GAO to determine exactly where the money was actually spent. 


Now, is this all a reason to hold up funds for Sandy's victims? Maybe, maybe not. Katrina era FEMA was an unholy bureaucratic mess, and it seems unlikely that we'd see the same level of institutional incompetence repeated. On the other, FEMA has funds available to deal with the initial damage from this catastrophe, and double checking that they have some new organizational safeguards in place isn't necessarily the worst idea before releasing more. That's rational due diligence. 

But that brings us back to the rhetoric. King managed to turn serious issue into a racially loaded broadside on storm victims. The fact that his comments grew from a kernal of truth isn't a defense -- after all, there really once was a woman known as the "welfare queen" of Chicago, too. There's just no need to throw that kind of a bomb.

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Jordan Weissmann is a senior associate editor at The Atlantic.

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