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New Orleans Lies in Ruins and a Nation is Poorer

By James R. Hood
ConsumerAffairs.com

August 31, 2005

New Orleans' St. Louis Cathedral as Katrina moved ashore -- Getty Images

Aside from the awesome human suffering she brought to the Gulf Coast, Hurricane Katrina will have a major impact on the lives of American consumers for months to come. That's because, unlike many cities that have turned their old seaports into museums, New Orleans is a working seaport -- a big one, usually ranked as the third or fourth largest in the world.

Forget oil and gas for a moment. Vast quantities of food, grain and other commodities move through the piers located along the 100 miles of Mississippi River that leads to the Gulf and the region is home to a byzantine network of warehouses, railroad and trucking terminals and other essentials of commerce.

The river remains closed to navigation because of debris, beached ships, rogue barges and possible changes in the river bottom caused by silt deposited by the storm. Freighters can't get into or out of port.

Even after the river opens to ocean freighters, which may be several weeks, the distribution network will be hampered until rail and highway traffic is restored and the teamsters, longshoremen and warehouse workers are able to return to the city and get back to work.

Food

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The storm and its aftermath are likely to drive up the cost of basic food commodities and possibly even cause shortages in some areas -- coffee and fruit being two of the most prominent examples.

Much of the coffee consumed in America enters through New Orleans, coming up from Central and South American plantations. Freighters are not able to dock and coffee already in warehouses can't be moved and, if it gets wet, will be ruined.

Chiquita Brands International moves millions of bananas and other fruit from Panama and other Central American countries through New Orleans. Fruit rots. The longer ships are unable to dock and warehouses aren't emptied, the more food will be lost to spoilage.

While a lot of goods come into the U.S. through New Orleans, more goes out as America's bountiful harvest of grain, corn and other staples is shipped worldwide, feeding the world and supplying vital revenue to farmers and others in the food production industry.

Energy

Besides the oil rigs in the Gulf, the state of Louisiana operates a huge off-shore terminal where ocean-going tankers offload millions of gallons of crude oil. The terminal was damaged by the storm and, like the drilling rigs, is shut down.

Oil pipelines that snake through Louisiana to the North and East are shut down until they can be checked for damage.

Chemicals

A number of major chemical plants are located along the Gulf Coast. DuPont has closed its large titanium dioxide plant in Louisiana and an aniline plant in Mississippi until further notice. Most of the material produced in those plants is exported, so its loss may not affect consumers directly but, like the grain that can't be exported, will affect the balance of payments and thus the U.S. economy.

Travel

With New Orleans International Airport and a smaller facility at Gulfport, Mississippi, closed indefinitely, hundreds of daily airline flights have been canceled, causing ripple effects throughout the nation.

American, Delta, United, US Airways and Southwest canceled flights to New Orleans and to numerous other airports in Florida, Mississippi and Alabama.

The Economy

This is the first time in most Americans' memory that an entire metropolitan area has been effectively destroyed. The cost of rebuilding will be massive, the losses to businesses and families in New Orleans staggering. Beyond that, each day that Greater New Orleans is effectively dead in the water, it is not generating consumer demand, not buying goods and services. The effect will be felt by retailers, manufacturers and distributors for months to come.

The Culture

No other city can match New Orleans. It is one of a kind, a Mediterranean port city plopped down in the American South, teeming with seamen, warehousemen, voodoo practitioners, dock workers, layabouts, artists, tourists and the most distinctive collection of musicians anywhere.

It's a town where a working man can get an outstanding lunch, perhaps an oyster poorboy, and an excellent cup of coffee for a few bucks.

Blues, jazz, Cajun -- New Orleans is a hothouse of down-to-earth creativity. Doctor John, Geno Delafose, Steve Riley and the Mamou Playboys and hundreds of others percolate through the watery parishes and the nightspots of the French Quarter, the Fauborg and Uptown, producing a sound that is constantly changing, always distinctive.

Whether all this talent can be reassembled before it disperses to points unknown is one of the biggest questions posed by Katrina, the killer who destroyed a city and may have stolen its soul.

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