Recovery Architect

A Texas banker takes on the aftermath of the country's greatest national disasters.

Donald Powell had money on his mind the first time he visited the Louisiana-Mississippi coast after Labor Day weekend in 2005. Two or three days after Hurricane Katrina laid waste to 93,000 square miles of property and turned more than a million Americans into refugees in their own country, Powell needed to see the devastation firsthand. The former Texas banker was then chairman of the Federal Deposit Insurance Corporation, and the last thing he wanted was to preside over a slew of bank failures.

"We were concerned about liquidity and how people were going to get their money out of the banks. The banking sector was like everything else down there. It was upside down. Bank records were destroyed. Physical facilities were destroyed," he says. When asked two years later what that first post-Katrina visit was like, he takes a long pause before answering: "You can't describe it. It's eerie. Most of the people walking around had uniforms on-either police or military. Stray dogs were running through the streets. The water was still very high. We saw places where there were bodies. It was terrible."

With winds of 130 miles per hour and a storm surge as high as 27 feet stretching from Mobile, Ala., to New Orleans, Katrina devastated an area roughly the size of Great Britain, wiping out entire towns. New Orleans' 350-mile levee system was breached, flooding 80 percent of the city. The White House-directed government review of the storm and its aftermath estimated nearly $100 billion in damage, including 300,000 homes that were completely destroyed or rendered uninhabitable.

As even the White House report noted, the awe Katrina inspired in Americans was matched only by the anger and frustration most felt in witnessing widespread failures of government at every level. So when presidential aides Andrew Card and Karl Rove approached Powell soon after Katrina to discuss the creation of a federal coordinator position to manage the recovery, a lot of things went through his mind. "I'm sure there were other people they considered and maybe picked who turned them down," he says. "Obviously, I talked to people about it, and most said stay away from it. But I'm a kind of guy who likes deals nobody else wants to do."

So on Nov. 1, 2005, Powell became the federal coordinator for Gulf Coast rebuilding. His task is to prioritize needs for long-term recovery and to advise the president and senior administration officials on the most effective and fiscally responsible approach to supporting recovery.

The initiatives Powell and his staff of fewer than two dozen have taken on include:

  • Rebuild the region's water management system to world-class standards.
  • Restore wetlands.
  • Reconstitute the justice system.
  • Rebuild the health care delivery system.
  • Support business investment and economic development.
  • Repair critical infrastructure.
  • Rebuild and repair homes.
  • Improve and rebuild the education system.

Questioning Authority

"The office is long on good intentions, but I think it's very short on real authority to marshal the resources necessary for our recovery," says Sen. Mary Landrieu, D-La. "I think the chairman himself is very sincere in his desire to help the people of the Gulf Coast," she says of Powell, whose colleagues and staff refer to him as "the chairman" in a nod to the four years he spent as head of FDIC.

"He's made perhaps hundreds of trips to the region. He's walked through . . . destroyed communities and towns from Waveland, Miss., to Creole, La. But he virtually has no real authority," says Landrieu.

Powell skirts the issue: "I think anybody would acknowledge if you have authority, you have an advantage. But I don't wake up every morning and think about what I can't do. There's more than one way to skin a cat."

Powell says his role is "to shove, push, persuade, encourage our partners in the federal government to respond faster, more efficiently." For example, when the Federal Emergency Management Agency turned down a request from the Louisiana school system to build temporary classrooms to accommodate returning children this school year, Powell pushed the agency to reconsider.

"There was this thought that building temporary facilities was wasting the taxpayers' money. Well, that sounds great, but building permanent facilities takes time," and in the meantime, kids need to be in school, he says. The temporary facilities were built.

So many of the frustrations experienced by victims of Katrina stemmed from what he calls a lack of common sense among rule-bound government officials at all levels. As an example, he recounts receiving a phone call early last winter from a mayor in Mississippi who was worried that people with small children in his county were still living in tents.

"There were empty [FEMA] trailers next to these tents, but they could not get into them because they didn't have sewage permits," Powell says. "I understand the need for sewage permits, but what do you think the sewage was in those tents?" And so the Federal Coordinator for Gulf Coast Rebuilding urged the mayor to move people into the trailers, a violation of federal regulations, if not the law. When asked what happened as a result, Powell seems surprised by the question. "The [families] were warm and safe. I don't think anything happened to the mayor. Sometimes you have to use common sense."

Spending Transparency

In what Powell says is one of his staff's most important initiatives, the office will launch late this year a Web site that allows individuals to track the spending and progress of rebuilding projects. "If you're a mother or father and want to know when the Martin Luther King School is going to open, or what's the holdup-is it the federal, state or local government?-this will show you the flow of those dollars." If federal spending were more transparent, officials at all levels responsible for recovery operations would become more accountable to the public, Powell says.

Thus far, the government has distributed more than $96 billion out of $114 billion in federal aid for regional rebuilding, but there has been much confusion about where that money has gone. In some cases, projects have been delayed while states and localities develop comprehensive local and regional plans. The slow pace is in many ways inevitable, says Powell, because of the democratic nature of the recovery, where officials must seek consensus for rebuilding plans.

Tim Williamson first met Powell in late 2005, soon after he was appointed to the coordinator role. Williamson is president of the Idea Village, a nonprofit organization that helps entrepreneurs develop strategy and find talent and resources. Powell contacted Williamson to ask him to organize a meeting with some entrepreneurs in New Orleans.

The meeting involved about 25 local business owners, including the founder of a jazz orchestra, restaurateurs and a marketing company. "He asked a lot of hard questions. It was clear he was listening," Williamson says.

Powell remembers that he wanted to know about things like crime and the poor schools and how such things affected the business climate. "If I'm going to come back here and advocate for them, they have to believe [in the region's future]," Powell says. He met again with some in the group a couple of months later to discuss the recovery, and then arranged for a meeting of the group with Louisiana Gov. Kathleen Blanco to figure out how the state could better help small business owners. "From our perspective, he's been effective," says Williamson.

Not every encounter has been so positive. "I've been called everything in the world. I've been spit upon," Powell says, but adds that he doesn't dwell on either the positive or the negative reactions he's received. "I get a lot of satisfaction because I see things happening. I'm 66 years old and discovered a long time ago that not everybody's going to love me."

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