John Stossel of ABC News appeared on The O’Reilly Factor this evening in an excellent segment on the idiotic incentives that FEMA and the National Flood Insurance Program create for wealthy people to build in high-risk areas. Stossel knows about the government boondoggle personally–he built a beachside home and was compensated by your money and mine when it was wiped out.

Stossel recounted the lessons in Reason magazine.

It’s a good refresher course on the fiscal disaster of our federal disaster programs. I know many of my conservative friends are livid over the unhinged left’s Bush-bashing. I am, too–but not enough to give the feckless FEMA bureaucracy a pass.

See also: Frances, Fraud, and FEMA. As readers will recall, I called attention on this blog in January to the phenomenal waste of federal emergency funds in Florida and called on media outlets to pay closer attention to federal disaster rip-offs. That goes double, triple, quadruple for the billions about to be spent on Katrina relief.

The NYTimes reports on jaw-dropping figures in its Friday edition:

White House officials and Congressional budget experts now assume that federal costs for the hurricane will shoot past $100 billion, which itself is more than twice the entire annual federal budget for domestic security. Congress on Thursday approved $51.8 billion in spending, bringing the total so far to more than $62 billion…

…The torrent of money – more than $2 billion a day over the weekend, and expected to remain above $500 million a day for the foreseeable future – prompted several lawmakers to warn about the perils of an open checkbook.

“We are reaching a perfect political storm,” said Senator Jeff Sessions, Republican of Alabama. “We have all the earmarks of a rush to spend money that is very dangerous.”

Mr. Sessions called on President Bush to appoint a person with significant business experience to oversee the spending. Contained within the spending measure approved Thursday is a provision that directs an extra $15 million to the inspector general’s office in the Department of Homeland Security. The agency is also ordered to provide at least weekly reports to Congress on the use of the money.

More:

Tyler Cowen has a short history of FEMA and poses some good questions on levee subsidies.

Stephen Bainbridge writes on outsourcing disaster relief at TCS and follows up here.

Jerry Pournelle on abolishing FEMA.