US offers Katrina families $2,000 each
(AP)
Updated: 2005-09-08 08:51

Dispossessed families of Hurricane Katrina will receive debit cards good for $2,000 to spend on clothing and other immediate needs, the Bush administration announced Wednesday, working to recast a relief effort drawing scant praise from Republicans and scathing criticism from top congressional Democrats.

Democrats attacked as House Speaker Dennis Hastert and Senate Majority Leader Bill Frist announced creation of an unusual joint House-Senate panel to investigate the government's readiness for Katrina as well as its response. "Americans deserve answers," they said in a statement, setting a Feb. 15, 2006, deadline for a report.

At the White House, spokesman Scott McClellan defended Bush from Democratic attacks but conceded, "There are ongoing problems on the ground, and that's why we're working to address those issues."

The administration formally asked Congress for $51.8 billion in relief and recovery expenses in addition to $10.5 billion already approved, calling it the latest installment, but not the last. "We will in fact need substantially more" money, said budget director Josh Bolten, estimating the money would cover expenses for "a few weeks."

Bolten said about half of the newly requested funds would take the form of direct aid to individuals, and the administration said that included an estimated 320,000 of the $2,000 debit cards per household at a cost of $640 million.

Michael Brown, the embattled director of the Federal Management and Emergency Agency, said those eligible for the unprecedented debit cards would be permitted to use the money "for emergency supplies they need" such as clothing. "The concept is to get them some cash on hand which allows them, empowers them to make their own decisions about what do they need to have to repair their own lives," he said.

The federal government produced a seemingly endless stream of reminders of the devastation wrought by the storm as it battered the Gulf Coast from Louisiana to Florida.

Stephen L. Johnson, the head of the Environmental Protection Administration, said the floodwaters in New Orleans were so dangerous that there was a risk from mere skin contact, much less drinking. Initial government tests detected sewage-associated bacteria was at least 10 times higher than safe levels.

The Congressional Budget Office reported to congressional leaders that national employment could be reduced by 400,000 in the coming months, with a cut in economic growth of as much as a full percentage point.

The report said that Katrina's impact was likely to be "significant but not overwhelming" to the overall U.S. economy, especially if energy production along the Gulf Coast returns to pre-hurricane levels quickly.

Apart from the tab for federal relief, the House cleared two measures during the day to meet needs that didn't exist two weeks ago.

One bill would allow the administration to waive a requirement for students to repay their Pell Grants when they are forced to withdraw from classes due to natural disasters. The other would allow federal courts to conduct special sessions outside their geographic boundaries when they are unable to meet because of emergency conditions.

With polls showing Bush's approval ratings at low levels, Democrats seemed more emboldened to criticize him than at any time since he won a new term and they lost seats in 2004. They sought to use the events to question the appointment of John Roberts as chief justice and call on the GOP to put off a looming deficit-reduction package.

"We have just had a massive disaster," said Sen. Kent Conrad. "This is not a time to be cutting services to the most needy among us."

Referring to large numbers of poor and black New Orleans residents who were dispossessed by the storm, Sen. Edward M. Kennedy, said earlier in the week the disaster underscored "the glaring economic disparities facing our citizens."

"As a nation, we must be sensitive to this inequality, sensitive as we respond to Katrina, and sensitive, too, as we select now justices for the Supreme Court," he said. "That's a critical question for Judge Roberts. Can he unite America for the future?"

Top Democrats expressed unhappiness at the announced congressional investigation, to be run by a panel comprised of more Republicans than Democrats. The committee "is not truly bipartisan ... cannot write legislation, and will not have bipartisan subpoena power," Pelosi said.

In a letter to one Republican, Reid pressed for a wide-ranging investigation and asked: "How much time did the president spend dealing with this emerging crisis while he was on vacation? Did the fact that he was outside of Washington, D.C., have any effect on the federal government's response?"

McClellan brushed aside Reid's suggestion, saying the senator would not have engaged in "such personal attacks" if he were aware of Bush's efforts both before and after the storm.

Pelosi, speaking at a news conference, said Brown had "absolutely no credentials" when Bush picked him to run FEMA.

She related that she urged Bush at the White House on Tuesday to fire Brown.

"He said, 'Why would I do that?'" Pelosi said.

"I said because of all that went wrong, of all that didn't go right last week.' And he said 'What didn't go right?'"

"Oblivious, in denial, dangerous," she added.

McClellan disputed Pelosi's account of the meeting, and later, Brown sidestepped when asked whether he had offered his resignation.

It fell to Ken Mehlman, head of the Republican Party, to counterattack. "While countless Americans are pulling together to lend a helping hand, Nancy Pelosi and Harry Reid are pointing fingers in a shameless effort to tear us apart," he said.