Bush: Rebuilding Must Address Inequality

WASHINGTON - President Bush said the Gulf Coast must be rebuilt with an eye toward wiping out the persistent poverty and racial injustice plain to all in the suffering of the black and the poor in Hurricane Katrina's wake.

In a prime-time address delivered Thursday night from a largely empty, still-darkened Jackson Square in New Orleans, Bush accepted responsibility on behalf of the federal government for a response that he conceded was inadequate, and he sketched a reconstruction effort that aides said could rival the largest public works programs in American history.

"There is no way to imagine America without New Orleans, and this great city will rise again," the president said, standing before the floodlit statue of Andrew Jackson with the shuttered St. Louis Cathedral behind him.

Bush proposed a Gulf Opportunity Zone that would offer tax breaks and loan guarantees to businesses that rebuild in the disaster region, worker recovery accounts to help evacuees pay for job training and education, and an Urban Homesteading Act that would transfer surplus federal property to displaced families willing to build on it.

"It is entrepreneurship that creates jobs and opportunity," Bush said. "It is entrepreneurship that helps break the cycle of poverty."

The president did not name a price tag. Congressional budget analysts have privately estimated the federal share could reach $200 billion, a figure that has unsettled some Republicans already alarmed by record deficits.

Bush said the spending would be offset by cuts elsewhere in the federal budget, and he ordered his budget director to scour the government for savings. "We will do what it takes, we will stay as long as it takes," he said.

For a second time this week, the president took responsibility for the federal government's stumbles. "Four years after the frightening experience of Sept. 11, Americans have every right to expect a more effective response in a time of emergency," he said. "When the federal government fails to meet such an obligation, I as president am responsible for the problem, and for the solution."

Democrats gave the speech a guarded reception. House Democratic Leader Nancy Pelosi of California said the president "offered more of the same Washington approach" and renewed her call for an independent commission, modeled on the Sept. 11 panel, to investigate the response.

In New Orleans, where pumps continued to drain flooded neighborhoods and officials have pushed back the timetable for repopulating the city, reaction among evacuees watching in shelters around the country was mixed between gratitude for the promised aid and skepticism that it would reach them.

Bush also ordered the Homeland Security Department to review emergency plans in every major American city, and he suggested Congress consider giving the Pentagon a larger role in disaster response — an idea that drew immediate questions from legal scholars about the reach of federal military power on U.S. soil.

The speech capped a difficult two weeks for the White House, during which Bush's job-approval ratings sagged to the lowest levels of his presidency and the head of the Federal Emergency Management Agency, Michael Brown, resigned under fire.