Affordable Housing Institute : US

A couple of weeks back, so quietly you might have missed it [You certainly did! — ed. I said it was quiet, didn’t I? — Ed.], the President took his (and therefore the Federal government’s) position on the rebuilding of New New Orleans. 

 

He punted.

 

“Put that problem in somebody else’s territory.”

 

He issued Executive Order 13389 — Creation of the Gulf Coast Recovery and Rebuilding Council, with the following stirring mandate:

 

Section 1. Policy.  It is the policy of the United States to provide effective, integrated, and fiscally responsible support from across the Federal Government to support State, local, and tribal governments, the private sector, and faith-based and other community humanitarian relief organizations in the recovery and rebuilding of the Gulf Coast region affected by Hurricane Katrina and Hurricane Rita.

 

“Apres vous, my dear Alphonse”

 

The Executive Order thus places the burden on state and local government to develop a reinvention plan.  Under ordinary circumstances, this would made perfect sense … but this is the Big Easy, and who is going to spend the money, New Orleans city government? 

 

Among the many daunting challenges New Orleans faces in its rebuilding is replacing its battered housing — but many homeowners may not return. (By James A. Finley — Associated Press)

 

Many are covering their eyes:

 

Billions of dollars in public and private funds are going to be spent on rebuilding New Orleans, but those efforts could be undermined by forces that have long beset the city — a tradition of corruption and dysfunction and a weak economy that clouded New Orleans’s future years before the rains began in August.

 

“Always broke. Worst school system in the state. Highest crime rate in the nation. Shrinking population. All the corporations have moved out,” said Bernie Pinsonat, a political analyst in Baton Rouge. “Any poll I do, the rest of Louisiana thinks, ‘New Orleans is a deep, dark hole, and no matter how much money we send, it doesn’t seem to get better.’ “

 

To give you some idea of how things worked in the Big Easy:

 

“We’ve seen every type of corruption imaginable,” said U.S. Attorney Jim Letten, whose office indicted 44 public officials in the past fiscal year alone. He pointed to skimming, bribery and shakedowns across a spectrum of government employment: judges, police, teachers, administrators and traffic court workers.

 

Nor is the state government regarded as any paragon of virtue:

 

In a recent Louisiana State University poll of 419 business executives, corruption was ranked among the worst aspects of doing business in Louisiana. Investors and managers elsewhere are reluctant to come “because they don’t want to pay the corruption tax,” said Rafael C. Goyeneche, president of the Metropolitan Crime Commission.

 

The challenges ahead are huge, for the New New Orleans will be vastly different from the old:

 

A significant uncertainty is how large the city will be, and how many of its more than 450,000 residents will return, given an economic base that has been shrinking for years, especially since the oil and gas business migrated to Houston. The Port of New Orleans, for generations an economic engine, is so mechanized that it needs just 2,500 workers on an average day. New Orleans has one Fortune 500 company.

 

Analysts doubt that the largely unskilled workforce, even if it does come back, can sustain a prosperous modern economy. One in four adults has no high school diploma. The poverty rate in New Orleans is more than twice the national average, and the crime rate is among the nation’s worst.

 

The challenge is unprecedented, the complexity enormous, the need for urgency great, and the local administrative capacity indicted.  Markets and people are moving even if government is not, and the problems are piling up: a local utility gone bankrupt, housing prices skyrocketing as FEMA funding drives the market in what is likely a boom-and-bust cycle. 

 

The deferential “apres vous, Alphonse,” however administratively restrained and politically prudent, means the big decisions that have to be made first will not be made at all.

 

I am absolutely sure the Administration believes it is acting prudently.  Forcing a Federal czar onto Louisiana would not only invite infinite political scapegoating, it would also inhibit state and local authorities taking responsibility and making better decisions.  So the case can be made.  But in my bones I feel that while this worked brilliantly in New York City after 9-11, it will not work in the Big Easy, for several reasons:

 

• New York City had one site flattened.  New Orleans has had its entire infrastructure wiped out.
• New York City relocated only a few people, and not beyond reach of the subway.  New Orleans has been depopulated and the diaspora is returning slowly if at all.
• New York City was and is thriving.  New Orleans was on the wane.
• The part of New York damaged was the central business district, a place to which money flows first. The part of New Orleans most damaged was the worst, where money will flow last, if at all.

 

Even with all that, the Federal government stepped in early with the victims’ compensation fund:

 

Because of concerns that liability claims would clog the courts and create further economic harm, the federal government limited the liability of airlines, airports and certain government bodies. The government established the Victim Compensation Fund to make payments to families for the deaths and injuries of victims. In addition, the government funded a major economic revitalization program for New York City.

 

No analogous action, like condemning and compensating all of Under New Orleans, is taking place on the delta.

 

Should one adhere to a sound philosophy when there won’t be a second chance?  When the funds wasted may run into the billions, and the city’s future irretrievably compromised?

 

That’s using your head

 

Send post as PDF to