The largest city in the state suffers from a declining population (currently around 275k), poverty, failing schools (which the state took over) and a serious violent crime problem. Many of the city's remaining citizens are fed up with the current bald, business-oriented Democrat mayor, even though his predecessor was corrupt.
Years ago, a horrendous man-made disaster affected the area. In the aftermath, insurance rates rose, along with uncertainty and frustration. The entire country was impacted in some way. Even so, the rest of America hardly realizes the strategic and economic importance of this city, as it is home to one of the busiest seaports in the country.
Now, however, after a weekend of violent shootings, the national media is reporting that things are coming to a head for the embattled mayor:
NEW[City], Aug. 6 — As a weekend of bloodshed gave way to a day of mourning, the... public battering [was] beginning to take a toll on [the Mayor].... A group of protesters on the steps of City Hall were calling for his resignation, while a large huddle of reporters down the street waited with unanswerable questions about Saturday night’s fatal shooting of three [people]. ... [The Mayor] finds himself blamed for everything that is wrong with [the state's] largest city... after galloping into City Hall on a promise to change the political climate.... [the Mayor] finds himself at the nadir of his tenure, battling a homicide rate that refuses to yield and a growing tide of public hostility. ... It is worth noting that [the Mayor] held his news conference in the Police Department’s operations center, where 32 wireless surveillance cameras, installed two months ago, keep an eye on some of the city’s most lawless neighborhoods. But the new equipment and a strategic overhaul of the department have not reduced the steady drumbeat of killings. ... Then there was the [controversial speech].... [What the Mayor] intended as an affectionate tribute... was viewed as disparaging.
For both his enemies and his supporters, the episode seemed to crystallize a widespread sentiment here that [the Mayor]... is not entirely attuned to the culture and sensitivities of his constituents. [The Mayor] has apologized for the speech, but many are still feeling wounded. ... [A] small group of protesters... were ostensibly seeking an end to the senseless violence. But despite the placards calling for peace and unity, most at the rally outside City Hall on Monday were demanding the mayor’s ouster.
“He totally disrespects us,” said... a frequent critic of the mayor, screaming into a megaphone. ... [The Mayor] has long waved away such critics, saying they are surrogates for his political opponents or that they are seeking City Hall jobs that would buy their quiescence. Many of them, he points out, traffic in outlandish stories about the mayor.
“We have to use this as a pulling together, not a ripping apart,” he said about those using the killings to call for his resignation.
This all sounds eerily similar. Might this be an article about New Orleans and Mayor Nagin?
No, silly. Read the rest and you'll see where the similarities end:
But [the Mayor] has clearly been rattled by the recent violence, and by the rising tide of people expressing disappointment in him. He said on Monday that he had not slept in 48 hours. On Monday morning, he returned to the scene of the shootings to speak to hundreds of children at a summer program at the Mount Vernon School, promising the students that such a brutal crime would not happen again.
Moments before [the Mayor] was to step in front of the cameras, a mayoral aide noticed two middle-aged women and a man sitting silently among the crowd — relatives of... one of the shooting victims. Officials quickly ushered them to a back room to meet [the Mayor], who offered his condolences and promised that the police would stop at nothing to find the killers. ... Although [the Mayor's police director] frequently tries to remind the public that shootings are down 80 percent and that every other category of crime has dropped, Newark is just three body bags away from the 63 homicides tallied at this time last year, the highest in a decade.
Instead of losing sleep for days after a brutal violent crime and promising that the killers will be found and no more such crimes will occur... OUR MAYOR forms a consultantocracy to do his job for him while he goes on unannounced fundraising junkets so he can consider running a vanity campaign for Governor rather than running a city that desperately needs safe streets (not to mention cranes in the sky and explosives in the pie).
In case you didn't catch it, New Orleans and Newark have about the same population but Newark has 60 homicides so far this year, while New Orleans has about double that amount. ---
1. The T-P asks and answers the question: "What's Houston Got That New Orleans Doesn't?" Apparently the answer includes: oil companies, no state income tax, and that gloriously refreshing "favorable business climate" we keep hearing so much about. The comments in the T-P blog are typical. Depressing, irritating, racist and ignorant-- with one or two bright spots.
2. A & P's twenty-one New Orleans area Sav-A-Center stores are for sale. CityBusiness explores the tantalizing possibility that "a consortium of independent grocers such as Breaux Mart and Zuppardo’s Family Supermarket" may try to buy the stores, (which A & P wants to sell all together). Boy, it would make my day to see Breaux and Zuppardo's pull off an expansion like that.
3. Also, Citybusiness had a story titled "License to Rebuild: Construction permit levels top $1B in Orleans as recovery intensifies" and cites the 4,803 commercial permits the New Orleans Safety and Permits office has issued post-Katrina for work valued at $1.339 billion. Nice.
Some of the permits may be for Al Copeland jr, who plans to rebuild his shuttered New Orleans restaurants on St Charles Ave. The Cheesecake Bistro will open in November, but there's still "no timeline" in place for when the Copeland's eyesore on Napoleon will open. (Not that either location will cease being an eyesore after renovations, but they'll at least be open eyesores.)
[Researchers report that] the United States-— with five percent of the world’s population—- houses 25 percent of the world’s inmates. Our incarceration rate (714 per 100,000 residents) is almost 40 percent greater than those of our nearest competitors (the Bahamas, Belarus, and Russia). Other industrial democracies, even those with significant crime problems of their own, are much less punitive: our incarceration rate is 6.2 times that of Canada, 7.8 times that of France, and 12.3 times that of Japan. We have a corrections sector that employs more Americans than the combined work forces of General Motors, Ford, and Wal-Mart, the three largest corporate employers in the country, and we are spending some $200 billion annually on law enforcement and corrections at all levels of government, a fourfold increase (in constant dollars) over the past quarter century. ... [the researchers conclude] Incarceration begets more incarceration, and incarceration also begets more crime, which in turn invites more aggressive enforcement, which then re-supplies incarceration...
You've probably seen Jim Cramer's volcanic rant on CNBC by now. It's emotional enough to interest people who are bored by markets and business TV. Go see it. (Music "Mash Up" to the rant found here, and read the comments in the CR link above and here if you have the time.)
That's not a staged or premeditated Cramer Clown Show, folks. That wasn't done for ratings, nor was it some sort of planned gambit to "move the market". It was an explosion of genuine frustration; primarily at the "armageddon" in the bond markets due to the subprime mortgage meltdown and resulting credit crunch which is hurting Cramer's hedge fund friends who had overleveraged bets on these repackaged mortgages. Cramer wants the Fed to start cutting interest rates, but that won't really help anything but inflation at this point. He's enraged at being trapped by what bankers are desperately telling him off the record, contrasted with the soothing things they say with a calm face during the day on CNBC.
Of course, after Cramer went off and the market dropped another 150 points, conservative Larry Kudlow talked about whether the Democrats were the cause of Wall Street's worries, and then he got OMB Director Rob Portman to deny that there were any embedded problems in the economy, and to declare that the economy is "strong and growing", and that the housing market has definitely "bottomed".
That sort of naive "happy talk" would make me crazy, too. Like Cramer said, "It's a different kind of market" out there right now. But it 's not like we haven't been warned about overlooked risks. Here's some quotes that might be of interest:
The marking errors in the derivatives business have not been symmetrical. Almost invariably, they have favored either the trader eyeing a multimillion-dollar bonus or the CEO wanting to report impressive “earnings” (or both). The bonuses were paid, and the CEO profited from his options. Only much later did shareholders learn that the reported earnings were a sham.
Derivatives can exacerbate trouble that a corporation has run into for completely unrelated reasons. This pile-on effect occurs because many derivatives contracts require that a company suffering a credit downgrade immediately supply collateral to counterparties. It can all become a spiral that can lead to a corporate meltdown.
Derivatives also create a daisy-chain risk that is akin to the risk run by insurers or reinsurers that lay off much of their business with others. History teaches us that a crisis often causes problems to correlate in a manner undreamt of in more tranquil times. ... The derivatives genie is now well out of the bottle, and these instruments will almost certainly multiply until some event makes their toxicity clear. Central banks and governments have so far found no effective way to control, or even monitor, the risks posed by these contracts. Derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal."
A top Federal Reserve official warned yesterday that the U.S. financial system is evolving faster than the ability of investors, lenders and regulators to evaluate and manage the risks involved. ... "The complexity of many new instruments and the relative immaturity of the various approaches used to measure the risks in those exposures magnify the uncertainty involved," he said.
Some bankers talk publicly as if the inventory (of Leveraged Buy Out Deals) will vanish after a few weeks of vacation. In private, though, the mood has gone from Nantucket holiday to Bataan Death March. As one top merger banker put it on Friday: "I'm underwater on every single loan on my book." Translation: He's stuck with deteriorating loans that he was supposed to sell to others.
Despite the fallout, both bank and hedge-fund investors are willing to pay upfront money without seeing back-end results. The consequence is a free-rider's paradise, where individuals can stack up the short-term benefits for themselves, while letting the institution bear the brunt of their actions.
The result is a banker getting handsomely rewarded in January for making a loan that blows up in August. The hedge-fund manager, meanwhile, is able to buy up billions in suspect subprime real-estate loans and derivatives, clipping a 2% management fee along the way.
There is a market trade-off to these high rewards. Bad decision-makers can get yanked from their jobs at a moment's notice. But this can have the effect of creating still more incentive to land the big score.
Given the dollar amounts in play, that's getting increasingly possible, says Alan Johnson, managing director of Johnson Associates, which advises Wall Street firms about compensation. "The sums are getting bigger and bigger," Mr. Johnson says. "You've got young people doing aggressive things that have never been done before. What if it turns out really badly? It's what keeps CEOs up at night."
A few weeks ago one of my contacts heard that members of the RNC employed in D.C. were confident that the media was about to break another hooker story on Vitty-cent. This one involved an alleged $200k payoff Vitter made to his "baby mama" in Virginia.
Mark Kleinman has reported that former French Quarter prostitute Wendy Cortez now lives in Alexandria Virginia, with Vitter's child. (Nearly three years ago, Kos said Vitter had a love child, but it wasn't with Cortez.)
Now, obviously the story didn't break as the RNC members expected. Nor has Larry Flynt presented any new information on Vitter, despite claiming numerous New Orleans hookers (including Wendy Cortez) were linked to the Senator. But this particular rumor interested me because
1) The RNC was concerned 2) the $200k in "hush money" was a specific detail and 3) the Virginia angle corroborated what Kleinman has reported.
Time has a wide-ranging story discussing levees, coastal wetlands, USACE and the political games at all levels that have hindered the state's ability to acquire a sufficient flood protection system. I like the article, mostly, with some reservations that I don't have time to explain now. It begins with the strongest and most direct statement about the Federal Flood that I've seen in a national publication. If anything, the article nearly overstates the extent to which the catastrophe in New Orleans was a "man made" disaster, and I never ever thought I'd see that. Thanks to Michael Grunwald for writing this story.
The most important thing to remember about the drowning of New Orleans is that it wasn't a natural disaster. It was a man-made disaster, created by lousy engineering, misplaced priorities and pork-barrel politics. Katrina was not the Category 5 killer the Big Easy had always feared; it was a Category 3 storm that missed New Orleans, where it was at worst a weak 2. The city's defenses should have withstood its surges, and if they had we never would have seen the squalor in the Superdome, the desperation on the rooftops, the shocking tableau of the Mardi Gras city underwater for weeks. We never would have heard the comment "Heckuva job, Brownie." The Federal Emergency Management Agency (fema) was the scapegoat, but the real culprit was the U.S. Army Corps of Engineers, which bungled the levees that formed the city's man-made defenses and ravaged the wetlands that once formed its natural defenses. Americans were outraged by the government's response, but they still haven't come to grips with the government's responsibility for the catastrophe. ... As the disaster's Aug. 29 anniversary approaches, there will be plenty of talk about the future of New Orleans—-how to rebuild; bring home the diaspora; and deal with crises like housing, crime and education. But in the long run, recovery plans won't matter much if investors, insurers and homesick evacuees can't trust the Corps to prevent the city from drowning again.
There will indeed be a lot of talk about the future of New Orleans as the Aug 29 anniversary approaches. In fact, the Rising Tide 2 conference will feature two important presentations about levees and about the Corps' role in protecting the city and South Louisiana. Why not register to attend today? ---
Update: please read Matt's take in the comments section to this post. --- Update #2:Jeffrey writes an excellent critique about some of the things I had reservations about but was too lazy to properly explain.
In early June, longtime Louisiana right-wing radio talk show host and unabashed Duke supporter Keith Rush, 75, was elected to the Republican State Central Committee, the governing body of the Louisiana state Republican party. Another loyal Dukey, veteran GOP activist Vincent Bruno (Duke’s former “spiritual advisor” and a member of his inner circle of advisers in the late 1980s and 1990s), nominated Rush for the powerful position.
When Duke ran for governor in 1991, he backed Rush’s candidacy for Jefferson Parish Council, telling supporters in an endorsement letter, “He thinks like we do. He believes in the things we believe in.” One of Rush’s campaign fliers was titled, “Who is this racist?” In it Rush wrote, “This racist believes that ‘real’ racism thrives on affirmative action programs.” Rush was also a featured guest speaker at “Duke Fest,” held July 4, 1991, in New Orleans’ City Park. ... Rush’s election has so far gone unnoticed by national media, althoughRight Hand Thiefand the Flaming Liberal have been dogging the story since mid-June.
Why will no one in the State GOP publicly oppose Keith Rush's election to the RSCC? How many more David Duke supporters will they allow into their party's governing body? More here.
And big thanks to the indefatigable Flaming Liberal who originally broke the story.
Quite simply, Ron Paul authored a racist and nativist newsletter in the nineties. There's no two ways about it, and I fully retract and apologize for my earlier (and quite limited) support for Ron Paul to win the GOP nomination. Though I lived in S. Tejas when he was doing this racist fearmongering, I can't recall ever seeing his writings.
For me, his newsletter's outrageous statements about Barbara Jordan-- a true politicalhero of mine-- are unforgivable. Paul called one of the most honorable politicians to ever come out of Texas a total "fraud". What a disgraceful charge.
--- Note: I edited the last sentence after publishing.
Barbawit at Prytaniawaterline is concerned the upwardly revised property assessments in New Orleans will be too high, and is so angered by the slow pace of the recovery that he's considering leaving the Crescent City.
I'd like to see more progress, too. Regarding the property tax issue, though, I agree 100% with this post by Cold Spaghetti. It perfectly expresses how I feel. Go read it.
Remember: Millages determine tax rates, not assessments. Now that assessments are becoming more accurate, it's imperative that we drastically cut millages (and loudly proclaim to the world that property tax rates in New Orleans are going down!). New Orleans had some of the highest millage rates in the country. Why? Because for decades the assessments were so g-ddamn artificially low! Millages were cut last year, and must be drastically cut again this year.
Also, keep in mind that a major reason why this backassward system is getting unwound is because District 6 in Uptown elected a reform candidate committed to fair assessments, and removed a family that had controlled the office for 80+ years. Unfortunately, both the Gambit and the Times Picayune refused to endorse the "IQ" reform effort , which sought to replace corrupt cronies like 4th District Assessor Betty Jefferson, Dollar Bill's sister. Only one reform candidate was able to win office, no thanks to the local media.
The case for a tax rate reduction, or millage rollback, is a no-brainer. By bringing real estate valuations closer to market values, the reassessment will effectively expand the city's tax base and generate more taxes for each mill -- the unit in which property tax rates are expressed.
This year, one mill generated almost $1.5 million in property taxes citywide, but the same mill could collect as much as $3 million next year if assessments across the city go up as much as some anecdotal evidence suggests, said David Gernhauser, secretary for the Board of Liquidation-City Debt, which oversees city borrowing.
The millages must be reduced so that residents and businesses won't be hit hard just as they are facing higher costs of insurance, utilities and other necessities.
Reducing millages is not up to the assessors, who only set the taxable value of homes and businesses. By law, all government entities must reduce millages after a reassessment, but they can raise them back up with a two-thirds vote of their governing body.
The New Orleans City Council and the Orleans Parish School Board make the ultimate decision on tax millages for the vast majority of property taxes collected citywide.
In a move that could ease the sting of new and in many cases sharply higher property assessments, the New Orleans City Council announced Wednesday that its members have agreed in principle to reduce the city's tax rate proportionally, so that the higher valuations won't necessarily mean big tax increases.
Meanwhile, the president of the Orleans Parish School Board, which receives the largest single share of the city's property tax revenue, said the board is likely to get behind the idea as well.
See, I told you this would work! Not all change is bad, New Orleans. Your fear of reform has let rich homeowners skirt their tax responsibilities for generations on end. Let's boldly enter the 20th century with a modicum of faith and unity. (And if you feel you've been legitimately overassessed, you have the opportunity this month to visit one of your seven highly compensated assessors, and make your case.)
Fun fact! I seriously considered running for Assessor in District 6 last year, until I learned about the coordinated "IQ" effort. It had been in the back of my mind since the summer of 2005, when I realized there was a political opportunity there. In fact, in August of 2005, I paid my local assessor a visit. I told him I was unsatisfied with my property assessment, as well as my neighbor's assessment. I told him they were far too low, and needed to be higher. You should've seen the look on his face.
My neighbor and I owned "sister" houses that were nearly identical. They were perfect comparables, and both were assessed at their purchase price. The problem was, I had purchased my house 3 years prior, and my neighbor had purchased hers 30 years prior. My house was underassessed by, say, 100k and my neighbor's was underassessed by 250k. I asked my assessor to properly adjust the assessments. He said he would correct the error sometime in coming years, but had no explanation as to why my neighbor's house hadn't been significantly reassessed for 3 decades. It didn't seem fair, I said. So he tapped on his desktop computer keyboard, and lowered my property assessment by 40k, below the purchase price, thinking that would satisfy me. I got a printout of the change and had my friend Medium Jim notarize the document, and planned to use it in my campaign.
The afternoons have been wet this summer. Sometimes the streets flood and people do strange things.
I just hope the pumps work and the canal walls hold.
From the Jay Z intro (which seems to be more about avoiding market downturns than rain or love or sex... but perhaps that's just me):
No clouds in my storms Let it rain, I hydroplane in the [wet] bank Coming down with the Dow Jones
When the clouds come we gone, we Rocafella She fly higher than weather And G5’s are better You know me, an anticipation, for precipitation. Stacked chips for the rainy day Jay, Rain Man is back with little Ms. Sunshine Rihanna where you at?
In a major blow to Louisiana, President Bush threatened Wednesday to veto long-awaited legislation with billions of dollars to shore up hurricane protection along the Gulf Coast.
House and Senate negotiators struck a bargain late last week on a $21 billion reauthorization of the Water Resources Development Act and it is expected to come to a vote before lawmakers leave for the month-long August recess.
But the Office of Management and Budget sent a letter to Capitol Hill on Wednesday saying that the price tag is too high and shifted too much of the cost of new projects from local governments and onto federal taxpayers. ... Among other things, the bill would authorize a 72-mile system of hurricane protection of levees and floodwalls to shield Terrebonne and Lafourche Parishes from storms sweeping in from the Gulf of Mexico. It also would streamline project approvals within the Army Corps of Engineers, provide enhanced hurricane protection levees for New Orleans and green-lighted coastal restoration projects.
"I am stunned by the President's WRDA veto threat. And I have one basic response- I will enthusiastically work to override his veto," said Sen. David Vitter, R-La., in an unusually harsh rebuke to the leader of his own party. "Considering the well-publicized criticism of the way the administration handled this (Hurricane Katrina) disaster, I'm stunned. I'm afraid the promise the president made to the nation in Jackson Square comes across as hollow today."
It really has been an extreme thrill to live in South Louisiana during the Bush era. It's almost amusing to see leftist bloggers from other regions of America (many comfortably ensconced in suburban habitats) work up the venom to cry out: "Chimpeach teh BusHitler!"
I wonder if they could endure living here, now. Where could they possibly find the words to adequately express themselves?
They don't understand the half of it. And most of the rest of the country doesn't understand a quarter of it. ---
Update: In the comments Schroeder provides links for some perspective to Vitty's sudden "enthusiasm".