Edwards Calls Recovery 'National Embarrassment'

Democratic White House hopeful John Edwards calls Gulf Coast recovery efforts a "complete failure of presidential leadership." Edwards also explains his handling of a personal financial matter related to Gulf Coast recovery.

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MICHEL MARTIN, host:

And now Democratic presidential candidate John Edwards. The former North Carolina senator has made rebuilding the Gulf a focus of his campaign. He launched his presidential bid from New Orleans, and he's called for a series of steps to jumpstart the post-Katrina recovery in the city. We caught up with John Edwards yesterday from a campaign stop in Miami.

Mr. JOHN EDWARDS (Former Senator, Democrat, North Carolina; Presidential Candidate): Thank you so much for having me.

MARTIN: Now we just spoke with a resident of New Orleans who says that, you know, he appreciates all the, you know, the college students and the faith-based groups who come down to help out gutting houses and so forth. But he's still very disappointed in the government's efforts to aid the rebuilding. And I'd like to ask what stake do you think the rest of the country has in rebuilding New Orleans?

Mr. EDWARDS: I think America has an enormous stake in rebuilding New Orleans. We've seen one of our great cities pummeled and much of it destroyed by hurricane, and this could happen in many places in America. It doesn't necessarily have to be a hurricane, but the forces of nature are powerful, and America has to be there for any of our cities or communities that get destroyed. And I think, unfortunately, this is an example of bad, not good, because I think the federal government's response to Katrina has been a national embarrassment.

MARTIN: Why do you think the rebuilding is not going as quickly as many people would like, especially as quickly as many of the residents would like? Do you think that's a private problem - it's an insurance industry problem, or do you think that there's a bigger policy problem?

Mr. EDWARDS: I think it's a failure of presidential leadership. I think the president of the United States did not take control of the situation, demand action at the highest level, eliminate some of the bureaucracies and red tape that stand between the citizens of New Orleans and the help that they need. I mean, as you well know from your coverage, the - if you walked through the Ninth Ward of New Orleans or St. Bernard's Parish, there's virtually no difference from the time, you know, of just a month or so after the hurricane hit.

We took 700 college kids down there to work to rehab houses, who gave up their spring break to go to work. And you didn't see any sign of the government anywhere. And the same thing's been true every time I've been to New Orleans. The work that's being done is being done by volunteers, by faith-based groups, by charitable groups, and, probably most importantly, by the people who live there. I think there's been a complete failure of presidential leadership in bringing the tools that are available to provide help to the community.

MARTIN: As part of your proposal to help New Orleans get back on its feet, you're talking about putting a lot of emphasis on health care, of creating a biomedical quarter, investing in nursing school capacity, building another veteran's hospital, as I understand it. How is that relevant to the basic needs of people? Most people are there for a place to work - most people don't work in health care - and a place to live?

Mr. EDWARDS: All of these things are related. They're connected to one another. In order for the people of New Orleans to come back home, the first thing they need is they need a safe place to live. In other words, the community, the city has to be secure. And the security means having enough police officers -they're about 500 shy now. The crime rate's significantly up. Having enough police officers - this is something the federal government could help with. And secondly, making sure the levees are rebuilt in a way that's secure and protects the city.

But in addition to that, people won't come home if they don't have a hospital to go to if their children get sick. They don't have a school for their children to go to. So rebuilding the infrastructure of the city is also crucially important, having more nurses available, making sure that the V.A. hospital is located in the city, which actually helps with jobs in addition to other things. I mean, most of this is not rocket science.

(Soundbite of music)

MARTIN: Just ahead, we're going to continue our talk with John Edwards, plus the mental health crises - the toll the hurricane is taking two years later.

Unidentified Woman: Since that time, I have been coping with my situation and trying to come back to life and be whole again, but two years later and I'm still suffering it.

MARTIN: The crises in mental health. That's just ahead.

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MARTIN: I'm Michel Martin. This is TELL ME MORE from NPR News.

Just ahead, what New Orleans may need most: care for the caregivers. That's a few minutes from now.

But first, we're going to continue our conversation with presidential hopeful John Edwards, who has put fighting poverty and rebuilding the Gulf at the center of his presidential campaign. Recent news reports have noted Edwards' $16 million investments in and consulting relationship with Fortress Investment Group. It's been reported that subprime lending units of Fortress were foreclosing on victims of Hurricane Katrina.

Mr. Edwards has said he would redress the situation, and I asked him how.

Mr. EDWARDS: I've done several things. One is to contact the people who are involved with the company - basically, it was a fund that had lots of investments, but one of the investments was in one of these companies - to contact them and tell them they needed to do something about this, first. Secondly, to start identifying - I've been working, actually, with the NAACP to identify the people who are in danger of losing their homes.

I've actually met with some already - in fact, I met with a family yesterday in New Orleans - to figure out what we can do to help, and we're working on putting together a system that will provide aid and assistance to the families who are in danger of losing their homes. And, in fact, I expect we'll have an announcement about that sometime in the next week or so.

MARTIN: And you've said you're going to divest your portfolio of the investments in subprime mortgages, but I think you've also said you were going to keep that investment in the hedge fund. So how is that possible? Have you asked the fund to divest itself of its subprime portfolio, or how is that going to work?

Mr. EDWARDS: I am not going to have any money that my family is investing - invested in anybody that's foreclosing on anybody in New Orleans. Period. And - so that's the reason we took the money out.

MARTIN: Okay. And finally, on this point, you've attacked mortgage lenders for predatory lending that preys on lower-income borrowers. And it was reported in the Wall Street Journal that some of the loans by the Fortress unit including fees and penalties that some people consider predatory. Did you know at the time that you were making these investments, and do you - is there a way that you could have been better informed about these kinds of fees?

Mr. EDWARDS: Oh, there's always a way. With enough time, you can figure out anything. So - but what I specifically asked before I had any connection with any of these companies, I specifically asked, is there anything that would - because of all the work that I'm doing on the issue of poverty and helping families who are living in poverty, I cannot and will not be associated with any sort of predatory activity because I'm - actually, I have put out the most aggressive plan to stop predatory lending in this country, and been pushing very hard for a national predatory lending law. So I said I can't be associated with anybody, anything that's doing that, and I was assured that they were not.

MARTIN: Do you think that further regulation is needed to avoid these kinds of situations in the future? Because obviously, you know, other people have different points of view on that. On the one hand, they say that products are being made available to people who otherwise would not have had access to credit. On the other hand, there are people who feel that these are - these policies prey on the people who are least able to protect themselves from the negative consequences.

Mr. EDWARDS: Yes. The answer to that question is absolutely. We should have a national predatory lending law. I was the first presidential candidate to propose this - an aggressive national predatory lending law that prevents the abuses, prevents the charging of fees that shouldn't be charged, prevents interest rates that are out of whack. I mean, all of those things are important. It can be done - you know, there's a distinction, which you just made, between lending at rates that are slightly above the market so that credit can be made available to people who don't - otherwise don't have it, and some of these abusive tactics. And it's the abuses that need to be stopped. And that's exactly what I've been pushing for.

MARTIN: I want to go back to New Orleans where - a place where you've spent a considerable amount of time. And NPR's MORNING EDITION covered your parents in New Orleans on Monday, and some of the residents they talked to afterwards said they were tired of having politicians use their city as a backdrop for campaigning without following through. So how do you plan to assure the residents of the Gulf - in New Orleans and the rest of the Gulf - that you do plan to follow through, that you're not just using them as a photo op?

Mr. EDWARDS: Well, first of all, what you will hear from most people in New Orleans is they think they've been forgotten, that there was a lot of attention, a lot of politicians coming down in the few weeks right after the hurricane hit, but they don't see anybody anymore. Nobody comes anymore. There's no national attention. Nobody is focusing attention on the struggles that they're going through. And, you know, at the risk of arguing, I think that there is real value in continuing to bring to the attention of America the failures that have occurred in New Orleans and the needs of the people of New Orleans, so that they are not forgotten.

Having been through hurricanes and the devastation of hurricanes in North Carolina, what I know is there's lots of attention in the immediate aftermath, and then everybody's attention fades. So I think, first, bringing attention is a very positive thing. Second, there need to be very concrete proposals about what can be done to rebuild New Orleans. The ideas that I've developed are not abstract. They come from having spent time in New Orleans, listening to the residents, understanding what the needs are. I mean, the things that we - that I have proposed to create jobs - 50,000 stepping-stone jobs.

People have to have jobs to come back to, otherwise, they can't support their families. Helping them in rebuilding their homes, funding the programs that are available to help those whose houses are lost that are not insured, and the losses were not insured. Making sure they live in a safe place where they don't have to worry about crime, and they're not worried about another storm. I mean, all of those things are absolutely crucial to rebuilding the city.

MARTIN: Which of your proposals that you've made to rebuild New Orleans will you commit to at least attempting to implement in the first 100 days of your presidency?

Mr. EDWARDS: I commit to doing everything in my power on all of these things in the first 100 days. And what I have said is we need, at the White House level, one person whose job it is to oversee the rebuilding of New Orleans - somebody who reports to me daily about exactly what's being done in New Orleans. And we need somebody to audit what's been done and what is being done with the billions of dollars of federal money that have been appropriated but don't seem to be used and aren't getting to the ground.

We need to determine where the money is, why it's not getting to the places we know that there's a huge bureaucratic backlog. We know there's red tape that stands between people and the help that they need. But the president of the United States is the only one that can cut through that red tape.

MARTIN: And finally, senator, I wanted to ask you, you've made New Orleans kind of a lead motif for your campaign, your - it's kind of a symbol of your broader concern about the poor. Do you think that the rest of America, given all that is on the country's agenda, given the concerns that middle-class people have about, you know, their own health care, their own job security, given the concerns that everyone has about national security and the war on terrorism, do you think the country really is ready to focus on the concerns of the poor again?

Mr. EDWARDS: I do. I see it in the behavior of America. You watch the immediate response to the aftermath of the hurricane. There were huge outpouring of support - contributions and taking families into communities and volunteers going to New Orleans to do work. So I know that America cares about this, but it's one of those things that will fade from memory without presidential leadership. That's the reason it's so important for the president of the United States to keep reminding the country that there's work to do in New Orleans. There's work that we, as a nation, need to do if we're going to be there to help rebuild this great American city.

MARTIN: While I have you, senator, can I ask you - obviously, you're not in the Senate at present, so you don't get a vote on this - but Attorney General Alberto Gonzales resigned yesterday and I wanted to know if you have a comment on that, and also that Homeland Security Secretary Michael Chertoff is being discussed in some circles as his possible successor. And I wanted to know if you have a comment on that.

Mr. EDWARDS: Well, I think in the case of Gonzales' resignation, it's better late than never. He should have been gone awhile back. I've been calling for his resignation for months now. And I think the fact that he's gone - I think America clearly lost confidence in him as attorney general, and he needed to be gone.

As to Michael Chertoff, I don't think we should replace the man who gave us Guantanamo with the man who gave us Katrina. By replacing Alberto Gonzales with Chertoff, to me, I think, sends the wrong signal to the American people. There are thousands of highly qualified lawyers who are perfectly - maybe not political - but perfectly capable of doing a great job as attorney general of the United States. And I don't - it's just hard for me to understand why George Bush's circle is so small.

MARTIN: Former North Carolina senator, John Edwards, Democratic candidate for president, joined us from Miami. Senator, thank you so much for speaking with us.

Mr. EDWARDS: Thank you for having me.

MARTIN: I hope we'll speak again.

Mr. EDWARDS: Me, too.

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