Out of Control Policy Blog

Best Hope for New Orleans: Less Government

Thomas Bray offers some interesting thoughts on post-Katrina governance in the New York Sun:

    No doubt Washington will have a big role to play in clearing the debris, rebuilding roads, and helping with other infrastructure. And there will be pressure to establish some sort of victim's compensation fund, over and above the normal disaster relief.

    But the American taxpayer shouldn't be asked to rebuild New Orleans as it was. That would be an invitation to another disaster. Nor should American taxpayers be asked to create a "model city," writing blank checks for some Washington planners' sentimental, utopian view of how the Big Easy ought to look physically.

    Instead, federal and state authorities should focus on clearing away the barriers that have made it so difficult for any American city to grow in modern times. That would mean setting aside the regulations, taxes, minimum wages, and other burdens that serve mainly to engorge the federal and state bureaucracies. Make New Orleans a tempting place for entrepreneurial activity, able to compete with Houston and other port cities. Then stand back and let New Orleans spring back - if it will.

    The truth is that we cannot know what the new New Orleans will look like. That can only be decided by individuals who see opportunity there. Government's role is to reduce the barriers to opportunity, not erect a new city.

I wholeheartedly endorse this sentiment in general, but I think Bray misses a chance to focus on the local barriers to opportunity and economic development, which in New Orleans have been considerable for as long as anyone can remember. Though the floodwaters have lain waste to the city, the local governance structure remains intact, which doesn't bode well for the type of radical changes the city will need to reestablish itself.

There is some reason for hope, however, as Mayor Nagin -- despite the abundance of criticism heaped upon his shoulders due to the city's inadequate preparedness -- comes from a business background (former cable executive) and was elected on a platform of reducing regulatory barriers to economic development and routing out corrupt elements in city hall. It could be that the current disaster will offer his adminstration far wider latitude for reinventing city government than was feasible before. But it will be a long road from here to there.

Leonard Gilroy is Director of Government Reform


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