Swamp after the storm
The Puerto Rico power deal was all too typical
Facing unanswerable criticism from members of Congress and the Federal Emergency Management Agency back in November, the governor of Puerto Rico canceled the $300 million contract awarded to a small Montana company to rebuild part of the island’s battered power grid.
Just how small is the company? A profile on a site that tracks federal contracts lists the firm, named Whitefish Energy Holdings, as having just two employees and $1 million in annual revenue.
One doesn’t have to be an electrical engineer to question their ability to rebuild the grid of an island of 3.4 million people, many of whom are still without power since Hurricane Maria hit in late September (and some have been suffering since Hurricane Irma passed through earlier in September).
Obviously, a tiny, inexperienced company like Whitefish was a mystifying choice for this job. But it makes more sense in light of the fact that Whitefish is based in the hometown of Secretary of the Interior Ryan Zinke. The company’s chief executive, Andy Techmanski, is his neighbor.
It also makes sense in light of recent history. Increasingly, corruption seems endemic to U.S. government-funded humanitarian rebuilding programs.
When a 7.0 earthquake struck Haiti in January 2010, at least 160,000 people were killed and another 2 million were forced from their homes. More than $10 billion in foreign aid later, 2.5 million Haitians are still in need of humanitarian aid, according to the most recent estimates by the United Nations.
The Haitian contracts consistently prioritized the interests of the companies performing the services — and those of their benefactors in Washington — well above the needs of the displaced.
Take Clayton Homes, the recipient of a contract to build “hurricaneproof ... emergency shelters that can also serve as schools … to ensure the safety of vulnerable populations in high-risk areas during the hurricane season.”
When a team of reporters working for The Nation magazine visited the shelters six to eight months after installation, they found “20 imported prefab trailers beset by a host of problems, from mold to sweltering heat to shoddy construction.” The trailers were also leaking high levels of formaldehyde, a carcinogen.
Or InnoVida, recipient of $10 million in loans from the U.S. government to build 500 homes in Haiti. Before a single house had gone up, the company defaulted on the loan.
So why did Clayton Homes and InnoVida get contracts? Both had donated handsomely to the Clinton Foundation, and Hillary Clinton, at the time, was well-placed to reward those contributions. There were numerous other such instances.
Another natural disaster in the Caribbean, seven years after the scandal that was the U.S. government’s attempt to rebuild Haiti, a similar pattern re-emerges.
Humanitarian relief programs funded by American taxpayers need much closer oversight than they have gotten. The abuses are manifold, extravagant and, by now, predictable. Whitefish was relatively easy to catch for the scheme’s sheer boldness. But how many other sweetheart deals are hiding in how many more cleaner-seeming contracts?