FEMA's Ship of Fools Sails Onward
Rep. Henry Waxman (D - CA) wants to know why FEMA is paying Carnival Cruise Lines so much to rent three cruise ships to house Hurricane Katrina evacuees. In 2002, Waxman discovered, Carnival had gross revenues of $150 million over six months. In 2005, it's charging the federal government $238 million for the same time-period, even though for this particular journey, it doesn't have to burn any fuel (the ships are docked) or pay as many employees as usual (the bars and casinos are closed).
Seems like a case of gross profiteering, but hold your horses, Rep. Waxman, it may only be a case of fairly restrained profiteering. Carnival says its 2002 revenues were unusually low because of a drop-off in tourism in the wake of 9/11. In other words, it's all Clinton's fault! (If only he'd taken out Osama when it was easy to do so.)
Plus, there's this: "The deal with Carnival includes government reimbursement for Carnival's losses from closed bars and casinos aboard the ships, additional costs from hiring American workers to service the ships instead of the foreigners it normally uses, and reimbursement of $35 million in U.S. taxes incurred while the vessels are tied up at U.S. ports."
So, ultimately, FEMA could have sent the evacuees on actual six-month luxury cruises, and not have paid a penny more (and maybe less). And yet this was the most cost-effective temporary housing it could find? Good thing a lot of the emergency workers are bringing their own hammers. — GREG BEATO
Lawmaker makes waves over cruise-ship housing [USA Today]
Contract Is No Carnival For Taxpayers [Think Progress]