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Katrina may convert New Orleans into Mexico

One unpredictable impact of Hurricane Katrina will be how the demographic changes it brings, centered in New Orleans, will affect Louisiana’s economy.

For over a century, the city has been in decline. It incompletely made the transition from a commercial capital in an agricultural-driven economy to the same status in an industrial-driven economy, and would have failed to do so without the oil and shipping industries. But when much of the oil industry fled starting 20 years ago, reducing the need for shipping as a consequence, and the city failed to make the transition into the information-driven economy, the steady ride downwards took on more the characteristics of falling off a cliff.

The main source of this decline came from a creeping political liberalism and populism which, ironically, penetrated the city later than the rest of the state but which today retards it more than anywhere else in the state. The New Orleans Ring political machine resisted the socialism of Gov. Huey Long past any other area of the state because it was the power he supplanted.

It then became exasperated by a series of mayors more interested in wealth redistribution, to both the “disadvantaged” and their own cronies, beginning with probably the worst, Bob Maestri, but fortunately followed by two relative reformists, deLesseps “Chep” Morrison and Vic Schiro. However, starting with Maurice “Moon” Landrieu, whose grandest economic idea was to build a storm shelter for uncivilized behavior, things began sliding backwards progressively with Ernest “Dutch” Morial and his son Marc Morial sandwiching the reign on the benign but un-visionary Sidney Barthelemy. (Many had high hopes for current mayor C. Ray Nagin, but his performance relative to the disaster ought to snuff those out pretty quickly. Also worth noting – all were Democrats and, beginning with Dutch Morial in 1978, all were black)

So, for the better part of 35 years, New Orleans has had political leadership that, if not outright corrupt, has been particularly ill-suited to bring development to New Orleans in the modern economy. This has created a city whose population continues to decline dramatically and which disproportionately leaves poorer and higher proportions of blacks in it.

In one respect, Katrina may cause New Orleans to become akin to Mexico, exporting poor people away from an environment that does not hold out much promise for economic development. Those who got out showed a determination not unlike that of illegal aliens (and, in fact, probably faced more hurdles than the typical border-crosser given our lax efforts to protect our southern border).

But while one might be tempted to regard this as a refreshing thing (getting the disproportionate number of the poor out who heavily use government services as a result of their poverty), in fact it probably acts as a curse. It was the mainly the most infirm, most unskilled, and most criminal element that did not leave, who are the greatest burden on government and taxpayers. Worse, joining the more-motivated poor who now reside in places where they can do better, a number of more productive citizens who stayed because of certain attachments, with those attachments now gone, also will never return.

(As a case in point, a friend of mine with an Ivy League degree and an advanced degree had just moved to the city to work in order that he and his wife be closer to her family. Her family lost most everything. Now, he reports they are unlikely to return and will head back east.)

These factors complicate the affirmative answering of the question whether New Orleans can even come close to its pre-Katrina semi-glory, much less reverse its decline. With now even the tourism prop somewhat knocked out from under it, a population disproportionately depleted of its more-capable citizens, and a city and state whose political leadership has had a hard time of mastering concepts which have led to growth elsewhere, New Orleans may continue not just to export it citizens as if it was Mexico, but soon also to look more than just politically like Mexico than the U.S.

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