Ramping up the blame game

Blanco.jpgAs noted here earlier, I don’t think it’s the time to point fingers at each other while there are still people to be saved inside New Orleans, although I do think the question of why troops were not used earlier to re-establish civil order is a reasonable one.
However, among the early analysis of what went wrong with the various governmental responses to the aftermath of Hurricane Katrina, this Washington Post article makes it clear that the Bush Administration is not going to take all the blame for various shortcomings:

Behind the scenes, a power struggle emerged, as federal officials tried to wrest authority from Louisiana Gov. Kathleen Babineaux Blanco (D). Shortly before midnight Friday, the Bush administration sent her a proposed legal memorandum asking her to request a federal takeover of the evacuation of New Orleans, a source within the state’s emergency operations center said Saturday.
The administration sought unified control over all local police and state National Guard units reporting to the governor. Louisiana officials rejected the request after talks throughout the night, concerned that such a move would be comparable to a federal declaration of martial law. Some officials in the state suspected a political motive behind the request. “Quite frankly, if they’d been able to pull off taking it away from the locals, they then could have blamed everything on the locals,” said the source, who does not have the authority to speak publicly.
A senior administration official said that Bush has clear legal authority to federalize National Guard units to quell civil disturbances under the Insurrection Act and will continue to try to unify the chains of command that are split among the president, the Louisiana governor and the New Orleans mayor.

As one my former professors used to remind me, “they fiddle while Rome burns and, to make matters worse, they do not realize that Rome is burning or that they are fiddling.”
Meanwhile, this City Journal article is a pretty darn astute analysis of what happened last weekend in New Orleans. Hat tip to Tom Smith over at the Right Coast for the City Journal piece.

A massive relief effort that you do not see

astrodome inside.jpgAs Americans are still attempting to absorb the shock of the largest exodus of citizens during our nation’s modern history, the Chronicle’s Steve Campbell’s great photo of the inside of Houston’s Astrodome provides the backdrop to a huge part of the Hurricane Katrina relief effort that you do not see on television — the massive effort by a network of Houston-area churches and charities to provide relief resources to the tens of thousands of Gulf Coast evacuees who are residing in hotels and homes throughout Houston and Texas.

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Updating Katrina’s economic ripples

refinery.sunset.web2.jpgSix days after Hurricane Katrina hammered a main conduit of the U.S. energy and shipping industries, much of the crucial infrastructure on the energy industry in the Gulf Coast region those remains shut down. Although a full assessment of the status of the region’s infrastructure still cannot be made because of the post-storm chaos, it is becoming increasingly clear that refining and production capacity in the region will be curtailed for a prolonged period of time. Earlier posts on the developing economic effects of Katrina over the past week are here, here, here, here, here and here.
First, the impact on refining capacity. The storm shut down about two million barrels a day of crude-oil refining capacity. That translates to the loss of about one million barrels a day of gasoline production, which is about 10% of total U.S. demand. It is now apparent that at least four refineries that together generate about 5% of U.S. oil-refining capacity will be down for at least a month as those facilities are repaired. Meanwhile, damage to production capacity has also been extensive. Although production is coming back on-line slowly, it’s becoming clearer that it will take at least several weeks — and perhaps months — for production levels to return to near pre-Katrina levels.

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Robert Reich on the dangers of the political economy status quo

reich.jpgRobert B. Reich is University Professor and Maurice B. Hexter Professor of Social and Economic Policy at Brandeis University and at the Brandeis Heller School of Social Policy and Management. He has served in three national administrations, most recently as Secretary of Labor in the Clinton Administration. Daniel Drezner points us to this NY Times op-ed in which Mr. Reich provides a fine analysis of the dangerous economic effects of the seemingly intractable governmental tendencies toward protectionism and pork-barrel spending:

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Chief Justice William Rehnquist, R.I.P.

Rehnquist.jpgChief Justice William H. Rehnquist‘s death Saturday night creates a second vacancy on the Supreme Court and raises the stakes in what will likely be an intense political battle over the Supreme Court’s future.
Over the next days and weeks, many Supreme Court commentators more knowledgeable than I will place Chief Justice Rehnquist’s judicial career in perspective (four good previous ones are here, here, here and here), so I will pass along the best of those commentaries. However, one thing is clear at this point: Chief Justice Rehnquist will be remembered — along with John Marshall and Earl Warren — as one of the Supreme Court’s three most influential Chief Justices.
Chief Justice Rehnquist’s death comes less than a month before his 81st birthday, only three months after the retirement of Justice Sandra Day O’Connor and just days before hearings on a former clerk of Justice Rehnquist, John Roberts, who President Bush nominated to replace Justice O’Connor. Judge Roberts confirmation hearing is currently scheduled to open Tuesday, but it likely will be delayed as a result of Justice Rehnquist’s death.

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A remarkable city responds as Katrina’s economic ripples ease a bit

astrodome7.jpgIn the chaos of the worst natural disaster of our time, the remarkable Houston community provided extraordinary relief for tens of thousands of New Orleans area evacuees and, in so doing, provided a substantial part of the calming effect that steadied jittery economic markets still attempting to stabilize from the effects of Hurricane Katrina.
First, the economic update. As the evacuation of New Orleans picked up steam on Friday, crude-oil and gasoline futures fell sharply as the federal government and the International Energy Agency arranged to release almost 2 million of barrels of oil daily to cover shortages caused by Hurricane Katrina. The short-term supply relief drove benchmark light, sweet crude oil October futures contracts down nearly $2 to $67.57 a barrel on the Nymex Exchange. Earlier posts on the developing economic effects of Katrina over the past week are here, here, here, here and here.
In addition to the drop in crude futures, Nymex gasoline futures for October fell 22.53 cents to finish at $2.1837 a gallon and the October contracts fell another 23 cents in overnight trading to end at $2.2295 a gallon. Also, Nymex heating oil futures for October traded down 10.74 cents to $2.0911 a gallon.

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Grilled by Koppel

tedkoppel.jpgLate night television viewers are still shaking their heads over ABC Nightline’s Ted Koppel‘s interview last night of Mike Brown, embattled director of the Federal Emergency Management Agency (FEMA). Here is a partial transcript of the interview, a portion of which went like this:

Koppel: You have chaos and anarchy breaking out in a number of different places in New Orleans, it would seem the first thing is to get good solid combat troops like the 82nd airborne or 101st in there. These are guys who are ready to move immediately. Instead you send National Guardsmen and it’s taking time. You don’t have time.
Brown: [T]here will soon be 30,000 armed National Guard troops in there to restore order, to take control of the facilities and allow us to do our job.
Koppel: Mr. Brown, you know, forgive me . . . But here we are, essentially five days after the storm hit, and you are talking about what’s going to happen in the next couple of days.

It didn’t get any better for Mr. Brown. Read the entire piece here.
Update: Stephen Bainbridge is asking the same question as Mr. Koppel.

A hero in New Orleans

New Orleans.jpgMy sense is that this is not the time to be blathering about who to blame for what has happened in New Orleans and the governmental response to it. The logistical complications alone of obtaining and organizing the resources necessary to evacuate hundreds of thousands of people under flooded and destroyed conditions are not understood by many of the folks who are criticizing those who are attempting to coordinate that task. So, I prefer to focus on that effort and the heroes who are arising amid the squalor.
One of those is Dr. Steve Phillip, who wrote the following email this past Tuesday afternoon from downtown New Orleans:

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Katrina’s economic ripples

katrina_box.jpgAs state and federal officials grappled with the massive human toll that Hurricane Katrina exacted on the Gulf Coast region, further assessment of the damage is indicating that the storm has wreaked havoc to key business properties along the Gulf Coast.
In positive developments, crude-oil prices eased early Friday morning in electronic trading and gasoline futures fell for the first time this week as several energy facilities on the Gulf Coast started up again for the first time. The front-month October contract on the Nymex Exchange fell 42 cents to $69.05 a barrel after rising 53 cents during trading on Thursday. However, crude oil contracts for November through February — traditionally high-demand months because of heating oil demand — were all trading above $70 a barrel amid worries that the storm had wiped out key refining capacity.

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Judge examining Lay-Skilling witness tampering charges

ken lay10.jpgSkilling4.jpgFollowing on this post from earlier this summer, U.S. District Judge Sim Lake gave his strongest indication to date that he is prepared to take action against the Enron Task Force’s strategy to deny former Enron chairman Ken Lay, former CEO Jeff Skilling and former chief accountant Richard Causey as many defense witnesses as possible in their upcoming corporate and securities fraud trial.
After attorneys for Messrs. Lay and Skilling filed another motion under seal with Judge Lake alleging prosecutorial misconduct in the Task Force threatening potential defense witnesses, Judge Lake on Thursday ordered another hearing next week after stating on the record that he believed the defense assertions that many witnesses had at least a perceived threat from the Task Force. Although careful to state that he had not yet concluded that prosecutorial misconduct had taken place, Judge Lake directed defense lawyers to provide to the Task Force a list of witnesses who have declined to talk to the Lay-Skilling defense team. The Task Force has named 114 unindicted co-conspirators in its legacy case against Messrs. Lay, Skilling and Causey, which is a far larger number of co-conspirators than has ever been alleged in any other federal white collar criminal case.

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