Reflections on Hurricane Katrina-4

September 13, 2005

[ Katrina 1 | 2 | 3 | 4 | 5 | Rita 1 | 2 ]

DISCLAIMER: Not only am I not a resident of New Orleans, I have (to my indescribable regret) never been there. Some readers who vehemently object to my conclusions, can throw this at me if they like. All I ask is, let me know how my non-residence in NO has led me into error.

Two points: one is, the accounts I've read that survived intense scrutiny, and the conclusions that make the most sense, are invariably made by those who love New Orleans and who live there. A lot of people living there evidently did not quite understand what an exquisitely well-endowed community NO was (and will be again). A lot of people observed the pandemonium and imagined they saw swarthy bodies of lümpenproletariat reverting to their animal nature; they saw human beings smashing windows and taking potable water, and other times of rapes in the Convention Center. They then argued this proved that the people of New Orleans were animals, or that so many were that un trago de metralla ("gulp of grapeshot") would serve well the squalid rabble. The lovers, the men and women whose intense personal affection for their city approximates that of, say, Romeo for Verona, were the ones who had the most plausible and trustworthy views.

The second is that New Orleans is special. The people from that city, I've come to learn, are not an atomized mob but proved to be resourceful, kind, and brave. The casual slanders of anonymous men and women, in their struggle to improvise, was a form of class warfare: not of conscious willful malice by the ranks of class warriors, as no war ever is, but fearful and dug into trenches in their soul.
I turn now to the reconstruction of the city.

The Delta has not only been a focal point of commerce since pre-revolutionary times, it has been a locus of financial management since the time of the 1st Bank of the USA (PDF & PDF). Nor is the city a has-been: while the US financial services sector has grown somewhat since 1805, New Orleans is still the seat of the National Finance Center, a nexus for payments for thrifts and home savings banks (what I normally call, in econo-speak, "financial retailing").

From the NYT, Sept 7, 2005

The photo above tells a lot about New Orleans: devastated job market, yet mediocre (as opposed to horrid) wage growth. Part two is visible in the gleaming highrises, which not only represent its thriving financial sector, but a booming government sector. Almost a fifth of the workforce in Lousiana works for the government (RECON), and payrolls are a larger relative share of the state total. This chart illustrates growth in US gov't employment in LA relative to the rest of the nation. State sector employment has grown in Louisiana for a combination of reasons, one of which is the mix of departmental activity already in the state (viz., Military and Treasury).

New Orleans, however, has suffered a decline in population since its peak of 630,000 (1960). In 2000, the population was only 485,000. Perhaps 250,000 will leave permanently.

BusinessWeek has an article describing the policy conundra of rebuilding. 80% of the city was flooded. Even if it is so that massive public works could have saved New Orleans, it's also unfortunately the case that massive public works have a weak constituency on both sides of the political spectrum. Conservatives generally oppose public works because they require taxes; liberals, because of unintended environmental consequences. Now, of course, no one is going to propose reproducing the status quo ante Katrina with its intractable risks of flooding every half-century. Hence, I believe it is most likely that a future NO will exlude the most severely flooded areas. These areas are too contaminated for ready reconstruction.

Gradually, substantiative reports are drifting in on the future of the city. They are, so far, an oppressively dismal lot; wrongly so. Much of the flood damage has spared the pool of fixed capital, such as the business district, manufacturing facilities, and toney neighborhoods where managers live. Resentment aside, the swathe of destruction has left the core of the city's primary economy intact. The future of New Orleans, however, will involve a changed geometry.

As with all US cities, geometry has been a devastating shortcoming. Cities simply have their productive cores too far away from ports or workers, not because euclidian geometry doesn't apply in this country, but because the shortsighted focus on automotive transit has made really productive densities impossible. If the city takes a linear form, like Seattle or the East Bay, its because of topographical features hemming it in. Commuters are therefore thrust ever farther away from their place of work, and houses within a "reasonable" commute distance become ever-more expensive. Seen in this light, the devastation of New Orleans has a startling result: like those cities of Germany and Japan, that burst back to overtake the victors of WW2, New Orleans will be physically transformed under historically fresh shaping forces. Planners and developers, barred for years from certain regions, are going to literally change the shape of the city to conform to the demands of $3.50/gallon gasoline. They may well find the challenge unmanageable, and leave the city en bloc, but I doubt it. Else, the problem is barely even acknowledged, let alone, the main course on everyone's plate.

"Movement faithful" have quite candidly scrambled to take advantage of Katrina for personal enrichment. PGL (Angry Bear) writes about the "suspension" of the Davis-Bacon Act, and wonders how contractors paying wages below the prevailing rate will be assured of quality work. Kash (same place) has a handy chart illustrating the fiscal impact of the Hurricane.

Awards to Halliburton/KBR are attracting attention (the Nation), although I'm afraid that entity is by now almost uniquely capable of carrying out the required operations in the region. In my view, the Halliburton contracts tend to arouse the wrong sort of indignation: not that the firm—a huge civil contractor with global reach and vertical integration—has ties to the White House and contracts as far as the eye can see; it's that the company remains unaccountable for its mismanagement and its anticompetitive practices. This company is now inescapable. That's the real problem.

(Part 5)

ADDITIONAL RESOURCES: I was impressed (or rather, made optimistic) by this David Moberg article's, "Will History Repeat Itself?" (In These Times, via Tiny Revolution, who also links to Mike Davis). I found the Beige Book for the 6th Federal Reserve District disappointing; the RECON page at the FDIC site whupped its ass.

See also Ms. Merritt at (Talk Left). At least one of her posts deals with the matter of Halliburton's close direct ties to outgoing FEMA heads Michael Brown (and his mentor, Joe Allbaugh). Prometheus 6 is another superb resource; he's rather like a utility I'd be devastated without. Courtesy of P6 we have NewBlackMan, with scholarly analysis of the sociology. How fast can a peer-reviewed journal cover this crisis, I wonder? Finally, there is the Washington Post and NY Times articles on reconstruction.