Reps. Costa and Cardoza Call for “Katrina” and “Rita” Bonds;

In FresnoPress Conference, Central Valley LawmakersExpress Concern Over Waste From Reconstruction Effort and Ballooning Deficits

Fresno, CA -Congressmen Jim Costa (D-Fresno) and Dennis Cardoza (D-Merced) today called forgreater accountability for federal dollars spent on Gulf Coastrecovery and reconstruction as well as a renewed focus on fiscal responsibilityin light of the current crisis. Inaddition, Costa and Cardoza supported the issuance of "Katrina" and "Rita"bonds, which would reduce the level of U.S. borrowing from foreigncountries to pay for this unprecedented recovery effort.

Costa:

"It is extremely difficult to watch our fellow citizenssuffer through these disasters. While itis our responsibility to explore all potential avenues for aid to the manypeople who are in need; it is also our duty to ensure the funds raised are usedto provide relief in an appropriate manner."

"Through implementation of Katrina and Rita Bonds, reform ofthe Medicare prescription drug plan and placement of a moratorium on tax cutswe can assure fiscal accountability in relief funding. It is our obligation to provide for ourfuture generations while we responsibly deal with today's crises."

Cardoza:

"My thoughts and prayers go out to everyone who is sufferingdue to these natural disasters. Congressman Costa and I are both committed toproviding all resources needed to aid victims and to rebuild shatteredcommunities. We must ensure that these funds go to the communities devastatedby these Hurricanes - not to line the pockets of unscrupulous contractors hopingto benefit from tragedy. "

"This catastrophe will cost the federal government hundredsof billions of dollars. Due to the current fiscal crisis, we are now forced toborrow staggering sums of money. This will mean exploding deficits and soaringdebt. It is time to finally implement long-overdue common-sense budget reforms. In addition - by issuing ‘Katrina' and ‘Rita'bonds - to be sold only to Americans - the U.S.can reduce its dependence on borrowing from Chinaand Saudi Arabia to fund theGulf Coast recovery effort."

Congressmen Costa and Cardoza Proposals:

• Issue "Katrina" and "Rita" Bonds

The outpouring of charitabledonations in response to Katrina was extraordinary. American investors shouldalso participate by being able to purchase "Katrina" and "Rita" bonds -US Treasury bonds to be sold over the next year to American citizens andcompanies. These bonds would be sold only to US buyers and would enableus to reduce our growing dependence on foreign capital to fund our rebuildingefforts

• Reform the Faulty Medicare Prescription Drug Plan

Congress can rewrite thePresident's deeply flawed Medicare Prescription Drug law - preserving the goodaspects such as benefits for low-income seniors, the drug discount cards thatseniors have already received, and the benefits for safety net and ruralhospitals - and save several hundred billion dollars in the next ten years.

Savings: $20 billion in FY05;$32.8 billion in FY06, $724 billion in FY06-15

• Force Government to be Accountable for Runaway Deficits

Our nation is currently facing afiscal catastrophe that could have been avoided. The broken budgetprocess has led to deficits of historic proportions, and these debts have leftour nation ill-prepared to absorb the costs of post-Katrina and Ritareconstruction. To get our nation back on track, we call for thefollowing:

• A bipartisan budget summit between the President and Congress.

• Immediate enactment of the Blue Dog budget process reform plan, which includes such sensible measures as restoration of Pay-As-You-Go or PAYGO limits sothat any new spending must be paid for by cuts in other programs or by new revenues, and a rainy-day fund to prepare for future contingencies.