[percy-l] hurricanes

Tim Cole tcole at adobe.com
Mon Sep 5 13:25:52 EDT 2005

Irrespective of whether or not one can argue that it's really the rest 
of the country's responsibility or not, the city and the economic 
activity it enables are critical. I think that both the feds and the 
local govts. have performed poorly in all this, particularly the latter 
(Nagin reminds me far more of Coleman Young than Giuliani in the way 
he's managed both his city and the pressure of this particular crisis).

New Orleans is going to be rebuilt...because it has to be. Here's an 
article on the economic an strategic importance of New Orleans.


New Orleans: A Geopolitical Prize
By George Friedman

The American political system was founded in Philadelphia, but the 
American nation was built on
the vast farmlands that stretch from the Alleghenies to the Rockies. 
That farmland produced the
wealth that funded American industrialization: It permitted the 
formation of a class of small
landholders who, amazingly, could produce more than they could consume. 
They could sell their
excess crops in the east and in Europe and save that money, which 
eventually became the founding
capital of American industry.

But it was not the extraordinary land nor the farmers and ranchers who 
alone set the process in
motion. Rather, it was geography -- the extraordinary system of rivers 
that flowed through the
Midwest and allowed them to ship their surplus to the rest of the 
world. All of the rivers flowed
into one -- the Mississippi -- and the Mississippi flowed to the ports 
in and around one city: New
Orleans. It was in New Orleans that the barges from upstream were 
unloaded and their cargos
stored, sold and reloaded on ocean-going vessels. Until last Sunday, 
New Orleans was, in many
ways, the pivot of the American economy.

For that reason, the Battle of New Orleans in January 1815 was a key 
moment in American history.
Even though the battle occurred after the War of 1812 was over, had the 
British taken New Orleans,
we suspect they wouldn't have given it back. Without New Orleans, the 
entire Louisiana Purchase
would have been valueless to the United States. Or, to state it more 
precisely, the British would
control the region because, at the end of the day, the value of the 
Purchase was the land and the
rivers - which all converged on the Mississippi and the ultimate port 
of New Orleans. The hero of
the battle was Andrew Jackson, and when he became president, his 
obsession with Texas had much to
do with keeping the Mexicans away from New Orleans.

During the Cold War, a macabre topic of discussion among bored graduate 
students who studied such
things was this: If the Soviets could destroy one city with a large 
nuclear device, which would it
be? The usual answers were Washington or New York. For me, the answer 
was simple: New Orleans. If
the Mississippi River was shut to traffic, then the foundations of the 
economy would be shattered.
The industrial minerals needed in the factories wouldn't come in, and 
the agricultural wealth
wouldn't flow out. Alternative routes really weren't available. The 
Germans knew it too: A U-boat
campaign occurred near the mouth of the Mississippi during World War 
II. Both the Germans and
Stratfor have stood with Andy Jackson: New Orleans was the prize.

Last Sunday, nature took out New Orleans almost as surely as a nuclear 
strike. Hurricane Katrina's
geopolitical effect was not, in many ways, distinguishable from a 
mushroom cloud. The key exit
from North America was closed. The petrochemical industry, which has 
become an added value to the
region since Jackson's days, was at risk. The navigability of the 
Mississippi south of New Orleans
was a question mark. New Orleans as a city and as a port complex had 
ceased to exist, and it was
not clear that it could recover.

The Ports of South Louisiana and New Orleans, which run north and south 
of the city, are as
important today as at any point during the history of the republic. On 
its own merit, POSL is the
largest port in the United States by tonnage and the fifth-largest in 
the world. It exports more
than 52 million tons a year, of which more than half are agricultural 
products -- corn, soybeans
and so on. A large proportion of U.S. agriculture flows out of the 
port. Almost as much cargo,
nearly 17 million tons, comes in through the port -- including not only 
crude oil, but chemicals
and fertilizers, coal, concrete and so on.

A simple way to think about the New Orleans port complex is that it is 
where the bulk commodities
of agriculture go out to the world and the bulk commodities of 
industrialism come in. The
commodity chain of the global food industry starts here, as does that 
of American industrialism.
If these facilities are gone, more than the price of goods shifts: The 
very physical structure of
the global economy would have to be reshaped. Consider the impact to 
the U.S. auto industry if
steel doesn't come up the river, or the effect on global food supplies 
if U.S. corn and soybeans
don't get to the markets.

The problem is that there are no good shipping alternatives. River 
transport is cheap, and most of
the commodities we are discussing have low value-to-weight ratios. The 
U.S. transport system was
built on the assumption that these commodities would travel to and from 
New Orleans by barge,
where they would be loaded on ships or offloaded. Apart from port 
capacity elsewhere in the United
States, there aren't enough trucks or rail cars to handle the 
long-distance hauling of these
enormous quantities -- assuming for the moment that the economics could 
be managed, which they
can't be.

The focus in the media has been on the oil industry in Louisiana and 
Mississippi. This is not a
trivial question, but in a certain sense, it is dwarfed by the shipping 
issue. First, Louisiana is
the source of about 15 percent of U.S.-produced petroleum, much of it 
from the Gulf. The local
refineries are critical to American infrastructure. Were all of these 
facilities to be lost, the
effect on the price of oil worldwide would be extraordinarily painful. 
If the river itself became
unnavigable or if the ports are no longer functioning, however, the 
impact to the wider economy
would be significantly more severe. In a sense, there is more 
flexibility in oil than in the
physical transport of these other commodities.

There is clearly good news as information comes in. By all accounts, 
the Louisiana Offshore Oil
Port, which services supertankers in the Gulf, is intact. Port 
Fourchon, which is the center of
extraction operations in the Gulf, has sustained damage but is 
recoverable. The status of the oil
platforms is unclear and it is not known what the underwater systems 
look like, but on the
surface, the damage - though not trivial -- is manageable.

The news on the river is also far better than would have been expected 
on Sunday. The river has
not changed its course. No major levees containing the river have 
burst. The Mississippi
apparently has not silted up to such an extent that massive dredging 
would be required to render
it navigable. Even the port facilities, although apparently damaged in 
many places and destroyed
in few, are still there. The river, as transport corridor, has not been 

What has been lost is the city of New Orleans and many of the 
residential suburban areas around
it. The population has fled, leaving behind a relatively small number 
of people in desperate
straits. Some are dead, others are dying, and the magnitude of the 
situation dwarfs the resources
required to ameliorate their condition. But it is not the population 
that is trapped in New
Orleans that is of geopolitical significance: It is the population that 
has left and has nowhere
to return to.

The oil fields, pipelines and ports required a skilled workforce in 
order to operate. That
workforce requires homes. They require stores to buy food and other 
supplies. Hospitals and
doctors. Schools for their children. In other words, in order to 
operate the facilities critical
to the United States, you need a workforce to do it -- and that 
workforce is gone. Unlike in other
disasters, that workforce cannot return to the region because they have 
no place to live. New
Orleans is gone, and the metropolitan area surrounding New Orleans is 
either gone or so badly
damaged that it will not be inhabitable for a long time.

It is possible to jury-rig around this problem for a short time. But 
the fact is that those who
have left the area have gone to live with relatives and friends. Those 
who had the ability to
leave also had networks of relationships and resources to manage their 
exile. But those resources
are not infinite -- and as it becomes apparent that these people will 
not be returning to New
Orleans any time soon, they will be enrolling their children in new 
schools, finding new jobs,
finding new accommodations. If they have any insurance money coming, 
they will collect it. If they
have none, then -- whatever emotional connections they may have to 
their home -- their economic
connection to it has been severed. In a very short time, these people 
will be making decisions
that will start to reshape population and workforce patterns in the 

A city is a complex and ongoing process - one that requires physical 
infrastructure to support the
people who live in it and people to operate that physical 
infrastructure. We don't simply mean
power plants or sewage treatment facilities, although they are 
critical. Someone has to be able to
sell a bottle of milk or a new shirt. Someone has to be able to repair 
a car or do surgery. And
the people who do those things, along with the infrastructure that 
supports them, are gone -- and
they are not coming back anytime soon.

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. Not 
all of the facilities are
destroyed, but most are. It appears to us that New Orleans and its 
environs have passed the point
of recoverability. The area can recover, to be sure, but only with the 
commitment of massive
resources from outside -- and those resources would always be at risk 
to another Katrina.

The displacement of population is the crisis that New Orleans faces. It 
is also a national crisis,
because the largest port in the United States cannot function without a 
city around it. The
physical and business processes of a port cannot occur in a ghost town, 
and right now, that is
what New Orleans is. It is not about the facilities, and it is not 
about the oil. It is about the
loss of a city's population and the paralysis of the largest port in 
the United States.

Let's go back to the beginning. The United States historically has 
depended on the Mississippi and
its tributaries for transport. Barges navigate the river. Ships go on 
the ocean. The barges must
offload to the ships and vice versa. There must be a facility to 
empower this exchange. It is also
the facility where goods are stored in transit. Without this port, the 
river can't be used.
Protecting that port has been, from the time of the Louisiana Purchase, 
a fundamental national
security issue for the United States.

Katrina has taken out the port -- not by destroying the facilities, but 
by rendering the area
uninhabited and potentially uninhabitable. That means that even if the 
Mississippi remains
navigable, the absence of a port near the mouth of the river makes the 
Mississippi enormously less
useful than it was. For these reasons, the United States has lost not 
only its biggest port
complex, but also the utility of its river transport system -- the 
foundation of the entire
American transport system. There are some substitutes, but none with 
sufficient capacity to solve
the problem.

It follows from this that the port will have to be revived and, one 
would assume, the city as
well. The ports around New Orleans are located as far north as they can 
be and still be accessed
by ocean-going vessels. The need for ships to be able to pass each 
other in the waterways, which
narrow to the north, adds to the problem. Besides, the Highway 190 
bridge in Baton Rouge blocks
the river going north. New Orleans is where it is for a reason: The 
United States needs a city
right there.

New Orleans is not optional for the United States' commercial 
infrastructure. It is a terrible
place for a city to be located, but exactly the place where a city must 
exist. With that as a
given, a city will return there because the alternatives are too 
devastating. The harvest is
coming, and that means that the port will have to be opened soon. As in 
Iraq, premiums will be
paid to people prepared to endure the hardships of working in New 
Orleans. But in the end, the
city will return because it has to.

Geopolitics is the stuff of permanent geographical realities and the 
way they interact with
political life. Geopolitics created New Orleans. Geopolitics caused 
American presidents to obsess
over its safety. And geopolitics will force the city's resurrection, 
even if it is in the worst
imaginable place.

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