Catastrophe in Big Easy Demonstrates Big Government’s Failure

Take Hurricane Katrina, a colossal failure of government at every level–federal, state, and local. Thirteen days after the hurricane, the Sunday Washington Post blared, “The Steady Buildup to a City’s Chaos/​Confusion Reigned at Every Level of Government.”

And what’s the response of the big-government crowd? “The era of small government is over.” “It’s libertarianism, more than anything else, that has transformed [New Orleans] into an immense morgue.” “Americans living along the Gulf Coast have now reaped the consequences of that hostility … to the role of government as a force for good.”

Let’s look at the facts. Government failed to plan. Government spent $50 billion a year on homeland security without, apparently, preparing itself to deal with a widely predicted natural disaster. Government was sluggish in responding to the disaster. Government kept individuals, businesses, and charities from responding as quickly as they wanted. And at the deepest level, government so destroyed wealth and self-reliance in the people of New Orleans that they were unable to fend for themselves in a crisis.

And some people conclude that we have too little government?

Start with the failure to plan. As Paul Krugman wrote on September 2:

The warning was there. And after 9/11, federal spending on homeland security skyrocketed, up to about $50 billion in the current fiscal year. A Department of Homeland Security was created, with FEMA folded into it. Meetings were held, memos were written, 190,000 employees went on the DHS payroll, billions were spent. If the FEMA memo and the Houston Chronicle article weren’t enough, the New Orleans Times-Picayune published a five-part series in 2002 titled “Washing Away.” So federal, state, and local governments were prepared for Katrina, right?

Wrong. During the Bush administration, Louisiana received far more money for Army Corps of Engineers civil projects than any other state, but it wasn’t spent on levees or flood control. Surprisingly enough, it was spent for unrelated projects favored by Louisiana’s congressional delegation.

What about the state and local governments? If you’re going to have a city below sea level in hurricane country, you’d better have some disaster plans. And plans they had. But apparently those plans didn’t include strengthening the levees or evacuating residents.

After Katrina left a path of destruction in Florida and picked up steam over the Gulf of Mexico, Governor Kathleen Babineaux Blanco conferred emergency powers upon herself. So she knew disaster was coming, not that that seemed to matter. Her Department of Homeland Security refused permission for the Red Cross and the Salvation Army to go into the city and deliver water, food, medicine, and other relief supplies to those suffering at the Superdome and convention center. Similarly, she took several days to sign a simple proclamation allowing doctors licensed out of state to help the sick and injured. Several doctors sat around for days waiting to go to work. As the storm hit New Orleans with full force, the local government effectively abdicated. Reports of looting began only hours after the assault.

FEMA issued a sternly worded release on August 29, the same day the hurricane made landfall along the Gulf Coast, titled “First Responders Urged Not to Respond to Hurricane Impact Areas.” FEMA wanted all the responders to be coordinated and to come when they were called. And that was one plan they followed. As the New York Times reported September 5:

Those weren’t the only examples. The city declined Amtrak’s offer to carry evacuees out of the city before the storm. On September 2, the South Florida Sun-Sentinel reported, “Up to 500 Florida airboat pilots have volunteered to rescue Hurricane Katrina survivors, transport relief workers and ferry supplies. But they aren’t being allowed in.” Hundreds of firefighters responding to a call for help were held in Atlanta by FEMA for several days of training on community relations and sexual harassment.

Even President Bush acknowledged September 13 that “all levels of government” failed to respond adequately to the most-anticipated natural disaster in history. But the government failure in this instance runs deeper.

Who were the people who suffered most from Hurricane Katrina? The poorest residents of New Orleans, many of them on welfare–the very people the government has lured into decades of dependency. The welfare state has taught generations of poor people to look to government for everything–housing, food, money. Their sense of responsibility and self-reliance had atrophied. When government failed, they had few resources to fall back on.

Some journalists have suggested that the despair of poor New Orleanians undermines President Bush’s case for the “ownership society.” In fact, the suffering visible in the poorest parts of the city is a perfect example of the failure of the “non-ownership society.” People had become trapped in dependency, with neither financial nor moral assets to rely on.

Meanwhile, despite FEMA’s best efforts, immediately after the hurricane the private sector–businesses, churches, charities, and individuals–began to supply services to the victims. Within 10 days after the catastrophe, charities had raised $739 million, far ahead of the pace of donations after the 9/11 attacks or the Asian tsunami. Experts predict that donations might eventually exceed the $2.2 billion donated after 9/11.

Even though private companies have no obligation for disaster relief, they started planning for a Katrina response before the hurricane made landfall. Two Washington Post reporters wrote that it’s “unsettling but inescapable” that commerce resumes quickly after natural disasters, that “Wal-Mart and Home Depot are in a class by themselves, going to extraordinary lengths to keep their customers supplied.” Would they really prefer that Wal-Mart and Home Depot closed in honor of the victims? Surely it was better for the survivors that these companies planned for disaster and reopened their stores rapidly.

Wal-Mart’s emergency preparedness division had ordered 10,000 seven-gallon water jugs for hurricane season. A full week before Katrina hit New Orleans, Wal-Mart ordered 40,000 more. Jefferson Parish president Broussard said that “if American government would have responded like Wal-Mart has responded, we wouldn’t be in this crisis.”

Drug companies created their own distribution systems to move medicines and medical devices into the storm-ravaged areas. Ten days after the storm the U.S. pharmaceutical industry had donated cash and products worth $42.5 million.

Churches and charities in the area and as far away as New Mexico and Maryland began sending trucks loaded with food and clothing and offering homes to evacuees. The Washington Post reported that “owing to stealthy acts of hospitality that are largely invisible to government”–and fortunately so, lest the government try to shut down these uncoordinated efforts –“hundreds of thousands of people displaced by Hurricane Katrina seem to be disappearing–into the embrace of their extended families.”

That’s nothing new. After Hurricane Andrew in 1992 the government set up tent cities, which went largely unused as people were taken in by family, friends, church members, and neighbors.

Faced with yet another failure of government to plan or respond adequately, a surprising number of people want to transfer more money and power from the private sector to government. After colossal disasters, politicians have two or three typical responses. They visit the stricken area; throw money at the problem–Congress has approved $62 billion in emergency aid so far for the ravaged areas; and usually add a new layer of bureaucracy to existing government agencies. After 9/11, Congress created the Department of Homeland Security. Could adding “and Natural Disasters” to the department’s title be far behind?

Coincidentally, Congress passed a second, $51.8 billion relief bill on the same day the Associated Press released a study of where the $5 billion small-business relief money after 9/11 went. It found that the funds went to a South Dakota country radio station, a Virgin Islands perfume shop, a Utah drug boutique, and more than 100 Dunkin’ Donuts and Subway shops–“companies far removed from the devastation.” Fewer than 11 percent of the loans went to companies in New York and Washington.

But it’s no accident that governments often fail at their tasks. The incentives are all wrong. Profit-seeking companies are constantly driven to innovate, improve, cut costs, and deliver better service for less money, lest they lose customers to their competitors or even go out of business. Churches and charities are motivated by love and commitment, as well as by the need to satisfy donors or run out of money. Governments can raise taxes or print money. If a government agency fails at its mission, the usual response is to give it more money next year–not a very good incentive for success. Politicians would rather cut a ribbon at a Cowgirl Hall of Fame than fix potholes or levees.

Before and after Hurricane Katrina, businesses and charities responded effectively. Government failed at even its most basic task of protecting lives and property from criminals. When massive and bloated governments at all levels disappoint, the solution is not to give them more money. Rather, the solution lies in a government limited in scope and ambition, and focused on its essential functions.