The people of New Orleans and the entire Gulf region continue to suffer because of the criminal neglect of the U.S. government. The suffering expanded following Hurricane Rita, which hit Texas and Louisiana just weeks after Hurricane Katrina hit the Gulf region on Aug. 29.
After the massive devastation and loss caused by Hurricane Katrina, New Orleans mayor Ray Nagin recently announced the layoff of up to 3,000 city workers—half of the city workforce. “I wish I didn’t have to do this. I wish we had the money, the resources to keep these people,” he said.
For some, Nagin became a hero in the days after Katrina’s impact for his open criticism of the Bush administration. “His flying over in Air Force One does not do [the situation] justice,” Nagin said in an interview on Sept. 2, 2005. As a Black mayor of a mostly Black city, his condemnation of the federal government’s response to Katrina affirmed that the issue underlying the disaster was racism. But Nagin’s criticism could only extend so far. He is a politician, formerly a highly paid regional head of Cox Cable, and ultimately beholden to the capitalist system.
Under capitalism, workers get laid off because of a lack of resources, while plenty exist for corporations to make billions rebuilding the Gulf region. This is the nature of capitalism. It allocates resources to generate profits for the owning class, not to meet the needs of the working class.
New Orleans devastated
Hurricanes Katrina and Rita have hurt millions of people. More than 1,300 people are confirmed dead and thousands are still unaccounted for. Hundreds of thousands of working-class families have lost their homes, jobs, cars and all possessions. Many of them are facing bankruptcy at exactly the time when a new law pushed through by the big banks has made that process much more costly and difficult.
The African American community in New Orleans was hit especially hard. The legacy of centuries of slavery, segregation and racism made it impossible for tens of thousands of people to obey the “free market” evacuation order from the government. In keeping with the “ethic” of capitalism, there was an evacuation order but no evacuation plan.
The government ordered people to leave New Orleans before the hurricane hit, but it did not provide the means to do so. New Orleans has the lowest rate of automobile ownership of any major city in the country. The very lowest percentages of households with their own cars were in the 98 percent Black Lower Ninth Ward and adjacent areas. Those were the communities where so many people were trapped in their homes or on rooftops, and where most of the deaths occurred.
Leaving New Orleans was chaos on the roads. Hundreds of thousands of private vehicles crept along a few miles an hour, thousands running out of gas along the way.
Profit-driven housing woes
Most who could leave did so, heading north in search of a hotel room out of harm’s way. People fleeing Katrina who were lucky enough to find a hotel or motel in the last days of August were still in those rooms six weeks later. Most hotels continued to charge their standard rates, up to $100 each night. FEMA and the Red Cross began picking up the tab for some of the rooms in mid-September, a program scheduled to end by Oct. 15. According to the Washington Post, 100,000 people were still living in shelters and 400,000 in hotel rooms on Oct. 2.
The new Federal Emergency Management Agency plan is to give families whose homes were destroyed either a lump sum of $2,358 or $786 per month for three months with the possibility of a 15-month extension. Given FEMA’s abysmal record—countless thousands have not received any benefits so far—that “possibility” is slim at best.
At the rates the hotels are now charging, FEMA’s plan would mean that families could only afford to stay for one week. Then, if they do not have their own resources, they would be evicted. Many people have nothing left, which is partly why the hotels want them out, even if the government were to keep paying for the rooms.
One of the largest chains in the world, Hilton Hotels Corp., has informed Katrina evacuees they must pack up and move out, according to an Oct. 6 AP article. The reason: whole families packed into large rooms “use more water and electricity, and do not spend much on food and incidentals.” Wall Street hotel industry analyst Bjorn Hanson is quoted in the article as saying that the rooms “could otherwise be occupied by a higher-paying guest who’s spending lots of money on telephone, food and beverage.” Hanson does not claim that the hotels are not making money; they are just not maximizing profits.
The biggest housing problem is that the government has made available only a tiny percentage of the necessary long-term housing alternatives. The government could seize hotels under the existing state of emergency or order them to lower their rates. It could also conduct emergency surveys of vacant housing or potential housing in the region—apartments, houses, mobile homes and other buildings, and order that they be made available. But such steps would impinge on the property and profits of the big hotel chains and landlords, something far more unacceptable to the Bush administration than homelessness for hundreds of thousands of people.
Property over people
The primacy of private property over people under capitalism is further illuminated in a statement from Rosemarie Hunter, a FEMA spokeswoman in Louisiana: “We have 12,000 mobile homes with no place to put to them.” Is the problem a lack of land or space? Not at all.
FEMA purchased $1.5 billion worth of recreational vehicles and trailers in September, often buying out entire dealerships. But, according to the Oct. 2 Washington Post: “In FEMA lots in Alabama, Louisiana, Mississippi and Texas, several thousand trailers stand empty, waiting for the agency to navigate land leases, zoning laws, local opposition and policy questions.”
It’s not only the big hotel chains and recreational vehicle industry that have profited from disaster.
The oil monopolies jacked up gas prices an average of 46 cents per gallon in the week after Katrina hit. The price hike applied to areas of the country that depended on the Gulf coast refineries and those that did not.
How much extra profit did that reap for the oil companies? With 320 million gallons used in the United States, on average, the price increase brought in $150 million per day—more than $1 billion per week—in excess profits.
Despite some more disingenuous statements from President Bush about “not tolerating price-gouging,” the U.S. government made no attempt to stop or control it. If the excess oil company profit was seized to provide relief, it would match several times over the $1.4 billion pledged by private charities for hurricane assistance.
The Bush administration also began handing out “no-bid” contracts to some of its favored corporate construction companies, like Halliburton, Bechtel and Fluor. That caused such a stir that FEMA was forced to announce that it was recalling the contracts and putting them out for bid. The same companies will likely still end up with the contracts.
Job and wage cuts in reconstruction effort
As the immediate crisis for the people of New Orleans subsides, those who are able are returning to their homes and communities to rebuild and start a new life in the demolished city. But without homes or jobs, the possibility of returning to “life as usual” seems bleak.
According to the Congressional Budget Office, at least 279,000 jobs were lost due to the hurricane. That is only an initial estimate. While businesses are re-opening, they are unable to function because many workers cannot return to the city. People still lack housing, electricity, food, and all the basic necessities for survival.
The mass layoff of city workers compounds the problem. Why isn’t federal relief aid being utilized to keep these workers employed? Many of them and their families have already suffered grievous losses. Now their misery is being deepened by loss of jobs.
The aim of the capitalists, and the government that serves their interests, is to make sure that as much of the $200 billion or more in relief and recovery assistance is converted into new profits.
The key to maximizing corporate profits in the hurricane recovery business is the same as in every other business: exploiting labor as cheaply as possible. Keeping New Orleans city workers does not accomplish this aim. Paying construction workers minimum wage on a monumental construction project, however, does.
To forward the capitalists’ goals, Bush recently signed an executive order waiving the enforcement of the Davis-Bacon Act. Davis-Bacon, passed during the depression of the 1930s, requires construction companies that are awarded federal contracts to pay workers the “prevailing wage.” The “prevailing wage” and accompanying benefits are calculated county-by-county across the United States. Where construction unions are strong, the wage rates and benefits are higher than where unions are weak or non-existent.
For example in Los Angeles, a highway carpenter working for a federal contractor must be paid $31.71 per hour with an additional $8.47 per hour in benefits.
In the South, unions are generally weaker. Before Bush’s waiver of the Davis-Bacon provisions, the same carpenter working in Jefferson Parish, Louisiana, for a federal contractor was required to be paid only $13.42 per hour, with $3.04 per hour for health and pension benefits. In Montgomery County, Mississippi, it was just $8.18 per hour with no benefits. (“Lessons for post-Katrina reconstruction,” Economic Policy Institute Briefing Paper, Oct. 6, 2005)
With the waiver of Davis-Bacon, there is no requirement to pay construction workers more than the federal minimum wage—$5.15 per hour. Nor do employers have to provide any benefits.
Undocumented immigrant workers suffer
Who will do skilled construction work for minimum wage?
One of the largely hidden groups victimized by the hurricane disasters are Latino immigrant workers. There are now more than 200,000 in Louisiana, including an estimated 140,000 Hondurans. Many of them emigrated from their homeland after another disaster, Hurricane Mitch, devastated Honduras in 1998.
A high number of these immigrant workers are undocumented. The Department of Homeland Security threatened them with deportation if they sought emergency aid. Later, without withdrawing the deportation threat, DHS announced that it would not punish employers in the affected region who hire workers without the legally required documents.
From the construction companies’ standpoint, this is a perfect combination. Many of the undocumented workers lost everything and have been denied access to assistance due to terrorist threats by the DHS. Taking advantage of their desperation, the bosses hope that the undocumented workers will be forced to accept any wages and conditions, no matter how bad. The danger this situation poses to undocumented workers and all working people is obvious.
Hurricane Rita: Katrina redux
Based on the government’s response to Katrina, the people of Texas and Louisiana affected by Hurricane Rita can safely guess what to expect in the coming months: a lack of affordable housing, job cuts, miniscule wages, no benefits, price-gouging and no-bid contracts.
The similarities in the U.S. government’s tactics in dealing with the two hurricanes became evident in the days before Rita hit the Texas coast.
In mid-September, reports of a second, albeit less powerful, hurricane in the region started making news. In an attempt to prevent a more militant outcry from the people of the United States about their criminal neglect of working people, the federal government said it would prepare in advance for the impact of Hurricane Rita.
Unlike in New Orleans and Mississippi, buses from across the country were sent to Galveston, Texas, and the surrounding region to help people evacuate before the hurricane hit. But this modest government effort was a disgrace. There weren’t enough buses and safety was not a priority. Twenty-four people leaving a nursing home close to Houston were killed when their bus caught fire.
Hurricane Rita reached the coast on Sept. 24. It largely spared the cities but devastated rural areas, particularly in Texas. As with Katrina, the government had not adequately prepared for the coming crisis. FEMA began to close relief centers just a few days after the hurricane saying they were “caught off-guard by the number of people in need.” (AP, Sept. 28) People began to faint in the triple-digit temperatures as they waited in line to receive help.
FEMA also encouraged those in need to “wait a few days” if they did not need immediate assistance. In Port Arthur, a working-class Texas town full of oil refineries and chemical plants, 58,000 people lost all electricity and running water due to the hurricane. One city official helping with the relief stated that the town’s residents are “living like cavemen.” (AP, Sept. 27) Many of Port Arthur’s residents are Black and Latino.
It will be weeks before power or water are restored to areas hardest hit by the hurricane. Almost 500,000 people in Texas and 300,000 in Louisiana are living in the dark without running water. In Woodville, Texas, people are being forced to brush their teeth and bathe in the Neches River.
Reminiscent of Ray Nagin’s initial anger at the federal government’s response to Katrina, Port Arthur’s mayor Oscar Ortiz stated, “we’ve had 101 promises” for aid, “but it’s all bureaucracy.” Aid requests to the state and federal governments after Hurricane Rita “were met with requests for paperwork.” (AP, Sept. 27)
As demonstrated by both Katrina and Rita, it’s clear that the local, state and federal governments are not prepared to respond to the needs of the people. They respond to the needs of those that society really works for—the capitalist class.
It doesn’t benefit capitalists to provide immediate affordable housing to those who lost their homes in the hurricane. It doesn’t benefit the capitalists to provide electricity, or adequate water and supplies to workers before they rebuild businesses. It doesn’t benefit the capitalists to pay a living wage to workers helping to rebuild the city of New Orleans and the entire Gulf region. The system dictates that the needs of the owners will always come before the needs of the working class, even after a natural disaster.
What is needed to counteract the government’s criminal profit motive is a mass struggle that demands jobs at union wages or a living income, decent housing, health care and education for all people affected by the crisis—regardless of citizenship status—for as long as needed.
Thousands of people are unemployed in the wake of Katrina and Rita.
Photo: Andrew Cutraro
Hurricane evacuees lack necessary long-term housing.
Photo: Bill Hackwell
