The Bush Way: CYA, Let Others Suffer

New York Times:

The Small Business Administration, which runs the federal government’s largest program to help disaster victims rebuild their houses, improperly canceled thousands of loans it had promised homeowners along the Gulf Coast after the 2005 hurricanes, a government audit has found.

The agency canceled nearly 8,000 loans without calling the borrowers or mailing them a notice, according to the audit by the agency’s inspector general. The homeowners did eventually receive a letter contending that they had voluntarily given up their loans, the report says, even though many told auditors that they actually needed the money.

The loans were canceled last year, after the agency had come under fire for being slow to give out rebuilding money, according to the audit. Former agency employees have complained that they were pressured to withdraw the loans to cut the number of applicants whose loans had been approved but not paid out.