New Orleans

Many of the problems that plague New Orleans existed prior to late August, 2005 when storm surges in the wake of Hurricane Katrina breached the levees and flooded the city. In the time that has followed, much has been said and little has been done, reflecting much broader issues in our contemporary landscape. Politics, priorities, poverty, power and the role of government are all under the microscope. Small victories and individual success are overmatched by systemic neglect and incompetence.


The city has yet to rebound fully and several factors have contributed to this shortfall. Failure of recovery in one area affects other industries. Tourism is a large component of the New Orleans economy, providing work for 63,000 people and providing 36% of the city's tax revenue. In 2004, 10 million visitors spent $4.9 billion; in 2006, comparable figures were 3.7 million tourists who spent $2.9 billion. Repercussions from this decline are felt in the music business, restaurants, and hotels. Conventions, always a large source of employment have fallen 30%.

Next to tourism, health care is the city's largest private employer. There are 16,800 fewer jobs now than there were before Katrina, down 27%. Only one of the city's seven hospitals is operating at pre-Katrina levels. Two are partially open and four remain closed. The number of hospital beds has dropped by two-thirds. Residents are packing the emergency rooms at six hospitals in neighboring Jefferson Parish (Figure 20). Hundreds of doctors did not return and of those who did, many are looking to relocate. Decline in hospital functioning affects everyone from florists to uniform suppliers.

The insurance industry was greatly affected and has paid out close to $25 billion in claims associated with Hurricane Katrina. The federal government has allocated $27 billion for housing, levees and "hazard mitigation." Yet despite the presence and/or potential of this money, many are hesitant to rebuild. Offshore oil and seafood industries have been hurt by interruption in the Gulf. The port is operating at pre-Katrina levels but many companies used the gap in services to relocate to more modern facilities in Houston or Mobile.


Rebuilding is slow and sporadic. There are signs of activity throughout the city but reconstruction efforts are haphazard. It took over a year to establish a fund to provide compensation for uninsured homeowners. Even for those with insurance and personal savings, there is a shortage of both skilled and unskilled labor to do the work. Plumbers, in particular, who need special skills to deal with the flood prone residential areas, are in short supply. Only now are some homeowners receiving some of the $6.3 billion allocated from the Road Home program but 80% of the applicants have yet to receive any assistance.

People are not rebuilding for many reasons. Many are hopeless and feel abandoned. Others are not sure it is worth rebuilding, either because they are still considering relocation or wonder if their new homes will survive the next Katrina. Only 22% of the federal money received by individuals has been spent. Insurance is available but it is extremely expensive: in flood prone areas, the standard rate is $2162 per $100,000 of house value. These rates are prohibitive for many whose personal resources and livelihoods have been stretched to the breaking point.

Only a small portion of money is designated for the construction of rental units. 21% of the 77,000 rental units which existed prior to Katrina are slated to be rebuilt and rates are expected to be two to three times as high. Out of the $6.3 billion slated in state funds for Road Home, less than $900,000 is earmarked for renters and most of those will go to middle class dwellers, such as teachers and police. Because these individuals never owned homes, they are not eligible for federal rebuilding money.

Large scale construction companies have been recruiting temporary workers from South and Central America. As these workers establish themselves, the demographics of the city are changing. There are 50,000 new Hispanic residents in Jefferson Parish and New Orleans.


Before Katrina, the population of New Orleans was approximate 450,000. Current estimates place the number at 250,000. Residents have returned to every part of the city except the Lower Ninth ward (Figure 17). Whole neighborhoods were destroyed and the communities they contained may never be rebuilt without the extended kin networks necessary for survival.

As of May 2007, 30,000 families displaced by both Hurricanes Katrina and Rita were spread across the country in apartments paid for by FEMA. Another 13,000 families are living in FEMA trailers in mobile home parks. These are the individuals least able to recover because they have the fewest resources and the least transferable job skills. They are rarely welcome in their new environments, often far from public transportation, job opportunities, and schools. They are also cut off from their support networks and those resources that enabled them to survive daily life.


After everything that has happened, the city is still using structural methods to address the problems of flood prevention. Close to two billion dollars has been spent by the Corps but many are concerned that the city is still at risk. Will the new levees installed be subject to breaches? Will the new pumps work quickly enough to eliminate water as it enters? The Mississippi River Gulf Outlet, responsible for so much of the flooding, has still not been sealed off and the Corps was getting bids for this project as recently as August 2007. Others lament that resources have been allocated to help some sections of the city at the expense of others. Floodgates installed to cut off fingerlike canals that allowed so much flooding seem to protect prosperous neighborhoods rather than poor ones.

The financing of these projects is still part of Congressional earmarks, subject to negotiation rather than priority concerns of safety and security. The city still lacks a comprehensive flood plan system. A $20 million study is expected in December 2007 that will outline the intended design.


If there was plenty of blame for the effects of Hurricane Katrina, the continued failures make for good political fodder. And while these recriminations might fill the hours on cable news shows, they do little to alleviate the problems of the residents of New Orleans. Worse still, is the absence of discussions of Katrina and New Orleans from our daily discourse. Whole sections of the city remain lifeless. Forty percent of the residents have not returned. Health care is inadequate yet the needs are dire. No one speaks of shrinking the size of the city; instead it is deteriorating from within.

Federal money has been allocated but does not seem to make its way to those individuals who need it the most. As of July, 2007, only one in five applicants has received money from the Road Home program although most are technically entitled to it. Out of 162,000 applications, 37,000 checks totaling $2.8 billion have been issued. Approximately 1000 applications per day were received as of August, 2007. At that same date, $6 billion dollars of FEMA money was not available. Federal rules mandate that recipients of disaster aid must apply for grants through their states which are required to make a 10% deposit for this grant. The intention is to guarantee state supervision of relief money but the 10% rule can be waived by Congress, as it did after September 11th. Congress did not grant the waiver for recipients of Katrina aid until June, 2007.

The people who are still in New Orleans suffer greatly. Those dispersed through the country and/or living in FEMA trailers have little hope of returning. Recent studies by the Sierra Club have even found toxic levels of formaldehyde in these mobile homes. Perhaps they are better off than the sick in New Orleans. The closing of most of the city's hospitals, particularly at a time when post Katrina ailments such as depression are on the rise, is taking an enormous toll. The Federal government advocates against reopening these hospitals but promotes building small state hospitals and using funds to get private insurance for the poor. More than half the uninsured would remain that way under this approach.

What Katrina has not generated in political circles is a genuine conversation about wetland restoration, infrastructure improvements and weather related disasters which will only increase in the years ahead. The markers of Katrina — poor and sick people on roof tops begging to be rescued, a president either unaware of or indifferent to the sufferings of the poor, and the incompetence of FEMA in handling the crisis — are the badges of shame we must all bear.

  1. How is Katrina the least of the problems that many New Orleans' residents face?
  2. What might have been done to facilitate the recover of New Orleans?
  3. How do problems in specific sectors — housing, economics, government — intersect to prevent recovery?
  • Dewan, Sheila. "Road to New Life After Katrina is Closed to Many." The New York Times. July 12, 2007.
  • ___________. "Hurricane Aid is Extended for Some." The New York Times. July 24, 2007.
  • Eaton, Leslie. "Shuttered Hospitals Ensure Slow Recovery in New Orleans." The New York Times. July 24, 2007.
  • Grunwald, Michael. "The Threatening Storm." Time Magazine. August 1, 2007.
  • Lashinsky, Adam. "New Orleans: Where's the Money?" Fortune Magazine. August 15, 2007.
  • Nossiter, Adam. "Largely Alone, Pioneers Reclaim New Orleans." The New York Times. July 2, 2007.
  • __________. "Hurricane Victims Rush to Apply for Grants as Deadline Looms." The New York Times. August 1, 2007.
  • Park, Andrew. "The Katrina Effect, Measured in Gigs." The New York Times. August 5, 2007.
  • Schwartz, John. "Engineers Faulted on Hurricane System." The New York Times. July 11, 2007.
  • _________. "One Billion Dollars Later, a City Still at Risk." The New York Times. August 17, 2007.
  • Simons, John. "New Orleans: Risky Business for Insurance." Fortune Magazine. August 7, 2007.
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