Affordable Housing Institute : US

 

[Continued from the previous Part 1 and Part 2.]

Rand’s quantitative study definitively plots the likely upward trajectory of New New Orleans given ‘reasonable’ decision factors. Can nothing be done to make things better?

Paging Dr. Pangloss!

 

Ideally, the Gordian knots of bureaucracy would be sliced at once, even if that amputates and cauterizes parts of the city:

Repopulation could also be accelerated if government officials provide clear and comprehensive information about progress and the ultimate goals for restoring essential city services and systems such as public transportation, levees, public safety, public education and hospitals, the report says.

 

Indeed, New New Orleans needs not just information — accurate information — but also decisions instead of punts, and well-structured incentives instead of pontifications:

“If officials give clear and complete information to the residents and businesses of New Orleans, people can start to make solid plans, and this will encourage the reconstruction and rebuilding process,” said Narayan Sastry, a RAND researcher and co-author of the report.

I’ve said this multiple times.

“Im more persuasive when I shout!”

 

Other authors of the report – titled “The Repopulation of New Orleans after Hurricane Katrina” – are Kevin McCarthy, D.J. Peterson, and Michael Pollard, all of RAND.

“The extent of the human and physical costs of Katrina on New Orleans is virtually unprecedented,” McCarthy said. “But the uncertainties surrounding the recovery are probably the single most important factor in determining the pace and extent of the recovery. The more government at every level can do to reduce these uncertainties, the more rapid the conclusion of the recovery process is likely to be.”

 

Yes! Months ago (October 26, 2005), I said this:

So let’s say what seems abundantly obvious: everything below sea level is economically unsalvageable. Nothing below sea level should be rebuilt with Federal funding.

It isn’t that the homes are physically uninhabitable (although many of them are), but rather than they are economically untouchable (mold).

Let’s be clear: we’re not abandoning that property. Condemnation means compensation: pay the property owners the pre-Katrina value of the property, and allow them to resettle wherever they like.

 

After its baseline analysis, Rand then twiddled the knobs into a pessimistic and optimistic range of repopulated New New Orleans. (Pessimistic and optimistic are subjective; as Rand admits, ‘our method … does not provide confidence intervals,’ page 28.) The results were an upper estimate of 320,000 people, and a lower estimate of 223,000.

 

The people have moved on. Many of them are not coming back. Six months ago, had the moves been swift and sure, things might have been different, but:

There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or lose our ventures.

Is the future bound in shallows and in misery?

What then must we do?

In light of this evidence, and in view of the situation on the ground today, what then should we do?

“When you come to a fork in the road, take it.” — Yogi Berra.

The answer may surprise you, as it surprised me:

Stop thinking these numbers are bad.

In economics, a ’sunk cost’ is one already spent that cannot be recovered. The concept matters because people have a powerful psychological tendency to chase their prior investments; emotionally, we will take much greater risks to recover losses than we will to increase our gains. This is a trap, into which it is all too easy to fall.

Ed Glaeser has a point: we should care about the people rather than romanticizing a nostalgic past. Like a glass menagerie, the Tennessee Williams Old New Orleans is forever shattered and gone:

“I did so wish the old N’awlins would never break.”

But — why cannot the New New Orleans be leaner and healthier than the old?

 

The Old New Orleans was a sick city: declining population, high unemployment, very high poverty (23%), a shrinking economy, failing local government, and a wretched public housing authority. The rising phoenix, reborn, could and should be healthier.

Lance Armstrong won the Tour de France because he had cancer that nearly killed him. In that miraculous recovery from the brink of death, he shed pounds and lowered his metabolic set point: the same power with fewer pounds.

No fat on that frame ….

The reborn Armstrong was leaner and meaner (if that were possible), more committed to racing and winning.

Not everyone who left Old New Orleans will return. There will be self-selection among those who do; perhaps they who come back will be collectively more entrepreneurial than those who resettle elsewhere.

 

New Orleans is famous for the jazz funeral: the slow dirge of mourning

The adagio

that breaks into exuberant dance. It’s time to stop mournin’ that old N’awlins, and start stepping out to create the 21st century city:

“Oh when the saints/ go marchin’ in’!”

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