The Federal Government has apparently spent $127 Billion(!) in New Orleans, an amount that rivals the state’s GDP and does not include the billions already disbursed by various insurance companies. Larry Kudlow puts this into perspective:
You might be asking: Where in the hell did all this money go? Well, the White House fact sheet says $24 billion has been used to build houses and schools, repair damaged infrastructure and provide victims with a place to live. But isn’t everyone complaining about the lack of housing?
Perhaps all this money should’ve been directly deposited in the bank accounts of the 300,000 people living in New Orleans. All divvied up, that $127 billion would come to $425,000 per person! After thanking Uncle Sam for their sudden windfall, residents could head to Southern California and buy homes that are now on sale thanks to the sub-prime mortgage crisis and bid up the sagging house prices in the state.
The fact sheet goes on to say that $7.1 billion went to the U.S. Army Corps of Engineers to rebuild the levees; that the U.S. Department of Education spent $2 billion on local schools; and that the Laura Bush Foundation for America’s Libraries has awarded more than $2.5 million (the pikers). The administration also provided $16.7 billion as part of the largest housing-recovery program in U.S. history.
So the billion-dollar question becomes: Where did the rest of that money go?
Meanwhile, according to an article by Nicole Gelinas at the Manhattan Institute, New Orleans has earned the distinct honor of becoming the murder capital of the world. The murder rate is 40 percent higher than before Katrina, and twice as high as other dangerous cities like Detroit, Newark, N.J., and Washington, D.C.
Think of this: The idea of using federal money to rebuild cities is the quintessential liberal vision. And given the dreadful results in New Orleans, we can say that the government’s $127 billion check represents the quintessential failure of that liberal vision. Hillary Clinton calls this sort of reckless spending “government investment.” And that’s just what’s in store for America if she wins the White House next year.
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New Orleans has not seen 127 Billion. No one in the gulf coast has seen 127 billion. Check out the hill blog: New Orleans Isn’t Falling for Bush’s False Sympathy.
You want to know where the money went? Ask Bush and Cheney. It’s their friends who are making out, not the people of New Orleans or the people of the Gulf Coast.
LewisC
Interesting facts and all, but New Orleans is notoriously corrupt and its people notoriously lazy. Even $15b is a lot, and these people need to learn to work for themselves, rebuild their own city, grow up, and quit complaining about our very compassionate country’s lack of compassion. Biloxi looks a lot better than New Orleans right about now, and it’s crime rate has not doubled. It has a lot to do with the character of the people in New Orleans.
Predominantly black areas, whether they be neighbourhoods, cities or countries appear so uniformly depressing that it’s a struggle to find a success story. From what I can gather, the Caribbean island of Anguilla is probably the best majority black society of any considerable size.
Like all democratic cities with large black populations, New Orleans is a cesspool of crime and degradation.
To have allocated $127B for 275m people is sheer lunacy.
Let’s hope the murder rate gets to 90% then we’ll have less parasites to feed and allow to propagate.
New Orleans, the perfect example of the Democratic Utopia.
1. The $127B is not just for New Orleans, it is for the whole “disaster” region, which actually stretches to places in the middle of Alabama, for instance.
2. Much (the majority I think) of the $127B is in tax incentives / relief, such as tax exempt bonds and accelerated depreciation. The majority of these incentives aren’t even going to places like New Orleans or Biloxi, because they are suffering from massive insurance hikes that are inhibiting building. Tax incentives are being used further north in places that were relatively unaffected. For instance, accelerated depreciation was used to spur sales of football-focused luxury condos at the University of Alabama.
3. A majority of the actual federal spending (as opposed to tax incentives) has been allocated but is still unspent. For instance, Mississippi is just now seeing the “Katrina cottages” being produced. This was a program to replace FEMA trailers with a better emergency housing alternative. Unfortunately, it’s two years after the storm so their main effect is going to be to compete with the real home building that is finally starting to happen here. There are many, many other programs with money still to spend.
4. As admittedly corrupt as Louisiana is, it has actually been slower in releasing much of its aid money than Mississippi. For instance, its direct aid to home owners, the Road Home program, has still only disbursed a minority of its funds, while Mississippi is pretty much done with its direct relief to homeowners. Of course, the Road Home is your classic example of a horribly administered government program for other reasons.
5. The people who have recieved the least aid in this whole affair are the poor blacks of New Orleans, who you seem to imply are the ones recieving the majority of it. They were for the most part renters and so didn’t qualify for programs like the Road Home. Nor did they possess the resources or education necessary to deal with much of the bureaucracy involved in these programs. To the extent they recieved aid, it was mostly in the form of rental assistance after they left the city (and many haven’t come back).
6. New Orleans problem is less how it has wasted federal money, and more how its complete lack of leadership has prevented it from getting the money spent. While the Mississippi Coast is finally seeing the money start to be spent, Louisiana is still coming up with and ignoring rebuilding plans.
To sum it up, there’s no shortage of waste and inefficiency in this story, but to say that it has all been sucked up by the corrupt inhabitants of New Orleans is a complete innaccuracy.
I didn’t mean to imply the residents of New Orleans were getting rich or stealing the money, though there was undoubtedly some fraud in the immediate wake of the storm. I do think the people, the politicians, and the attitude in New Orleans is all a terrible vicious circle, though, and it’s hard to say who is most at fault. I think the idea of “rebuilding cities” versus “helping people” is the problem here. People should get money and do what they will with it. If they want to move, great. If they want to stay, great. I think New Orlenas itself needs ultimately to be swallowed by the sea; it’s a unsustainable, below-sea-level city that has been in decline for over a century.
A large part of the city, particularly its most historic parts, received little or no flooding (the 18-19th century city was built on the high ground). There are many other cities in the country that flood as much as the historic parts of New Orleans did – think about Houston after a good tropical storm.
Just because you don’t like a city doesn’t mean it should or will be swallowed up by the sea, or that it should not recieve help from the government when the worst disaster in its history befalls it.
The real questions are whether the low parts of New Orleans should be rebuilt and whether we should attempt to artificially restore the population to its previous level. I think the answer to both questions is no, but that reality is having its own say in the matter, largely to the same end.
By the way, the ethnic composition of the city has shifted significantly due to the storm, and I am guessing that your main concern with the recoverabilty of city is the old ethnic composition of the city, which has now changed considerably.
Also, I don’t plan on paying much attention to Kudlow’s economic pronouncements after seeing the lazy thinking and failure to even remotely research the subject of his article.