Wednesday, September 21, 2005

Newer Orleans

Interesting article by George Friedman in the current issue of the New York Review of Books about the potential fall-out from the Katrina disaster. Friedman essentially compares Katrina to a nuclear strike on New Orleans, arguing that the economic impact of the disaster could be pretty much the same. His argument is basically that the New Orleans Port is critical for the US economy, as it is a important and unique shipping point, both for foodstuff going out of the country and for raw material coming in. While the basic shipping infrastructure seems more or less unharmed, Friedman's point is that without a city to support it this infrastructure may not be able to run - with catastrophic results for the US Economy.

While I think the overall article is interesting, especially in the way it focusses on the strategic and economic significance of New Orleans rather than its cultural significance, I think there are several flaws in the argument. To begin with, the comparison to a nuclear strike is fairly ridiculous. Friedman writes: "It is in this sense, then, that it seems almost as if a nuclear weapon went off in New Orleans. The people mostly have fled rather than died, but they are gone." Most people would consider that a fairly important difference.

Second, while Friedman begins by painting a cataclysmic scenario - he's soon forced to backtrack. As he acknowledges, the port facilities in New Orleans seem reasonably intact, and one could argue that if there really is so much economic value to shipping from New Orleans then the city (or at least the port) will be revived quickly. Friedman seems to believe that no one will ever come back to New Orleans - I'm not entirely convinced of this - one would think the employment opportunities would draw people back. Basically the free market would operate to create incentives that equilibriate the supply of these services with their value.

Which brings me to the third question - how valuable is New Orleans as a port? a) Is the stuff shipped up the river really that critical to the US economy? and b) surely there are other ports that could be scaled up and used. I don't know the answers to this, but I'm sceptical about the sort of doomsday pronouncements Friedman seems to make. It's interesting that Friedman provides no real figures / projections to back up his case.

Altogether, I thought the article lacked both depth and perspective. It felt like Friedman was so desperate to find something new to say about New Orleans that he picked an off-center topic and just tried to make it stick.


Veena said...

Comparing Katrina to a nuclear disaster? Should tell this guy to go to Nagasaki when he gets a chance!

I do think he raises some valid points though - there have been enough cities which so didn't pick up momentum after a natural disaster. Galveston, TX for example - it was more important than Houston before the 1900 hurricane but nothing really happened after that.

Also, think New Orleans is a pretty important port mostly because its connected to both the river and the ocean. Apparently a good % of basic stuff such as coffee and general grocery stuff were transported thru here.
Not sure whether other ports would be able to handle all this traffic now.

Falstaff said...

Veena: Right, my point is that you can't have it both ways - either New Orleans is unique and critical, which means it will pick up momentum quickly (don't know how critical Galveston's location was) or you can find other ports that will work, in which case the city may not come back, but it doesn't really matter from a purely geo-economic perspective.

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