Katrina's Potential Silver Lining
by Gary DeMar

The blame game will continue as politicians and political action groups jockey for position and funding for the upcoming elections in 2006 and 2008. Acts of heroism, self-sacrifice, and just plain hard work will be rightly honored. Religious organizations will gain new respect from the people being ministered to in both body and spirit. New Orleans and the Gulf Coast will probably be rebuilt after a heavy infusion of capital (tax dollars) pours into the region. This will create an unprecedented building boom and an increase in jobs. In reality, it will be little more than a transfer of wealth.

A great deal of ink has been spilled over how mostly poor blacks were the ones caught in the maelstrom of Katrina’s wrath. New Orleans has one of the highest poverty rates of any of America’s big cities. The federal government, actually, the Bush Administration, is being blamed for this. Because of tax cuts, the poor were left out of the economic recovery. Let me be blunt: Poor blacks have been warehoused in New Orleans because of well intentioned by inherently flawed welfare programs. Housing developments, a euphemism for “the projects,” were built to stack poor people on top of poor people, all in the name of social justice. Government subsidies made it easy for the poor to stay right where they were.

In 1937, New Orleans became the first city in the United States to benefit under the Wagner Act to provide public housing for low-income families. There are a number of basic economic principles that politicians either don’t understand or refuse to believe. One very important law is, if you subsidize something, you’ll get more of it. If the government is making housing available at below market prices, there will a significant number of people who will take advantage of the offer. TheSt. Thomas housing development originally included 970 dwelling units contained in a multitude of two and three story solid masonry brick buildings arranged around outdoor spaces. In 1952, 540 more housing units were added. At first, only whites could occupy the units. The Civil Rights Act of 1964 changed all of this and eventually led to a racially diverse, low-income, working class group of families. When family income reached a certain level, residents had to move out. So how did some families respond to the new income rules? They cut down on their income level by not working. Fathers often left because any added income puts the family unit over the limit. It’s not a coincidence that 35 percent of families in the Lower Garden District and Orleans Parish are led by women only.1 Many of these families stay poor to keep their subsidized housing and other welfare benefits. Subsidies have led to the immobility of the poor, the breakup of the family, and dependency on government programs. There is little incentive to leave the area, since the risks are seen as being too great. Star Parker, once trapped in the welfare cycle, writes:

Thirty-five years of Great Society social engineering have forced the disadvantaged to live under the control of the federal government. Politicians control their housing, food supply, schooling, wages, and transportation. A centralized government makes decisions about their childcare, healthcare, and retirement.2

Most of the St. Thomas Housing Development has been demolished, with the former occupants relocated, but with the same insane economic policies still intact. Some progress was being made in bringing development to the area. Wal-Mart wanted to build a store on the site of the old St. Thomas housing development. Opposition was loud and fierce, but in the end, after nearly five years of battles, Wal-Mart prevailed, employing 600 people.

So what’s Katrina’s silver lining? The poorest of the poor of New Orleans have been forced to leave the place they’ve called home and taken to cities where they may have to begin a new life. Black migration is not new, but it has never been this sudden. Blacks migrated from the South in the 1920s. Thomas Sowell’s research shows that there were many reasons for the size and scope of the mass exodus: “worsening race relations in the South toward the end of the nineteenth century, improving race relations in the North during the same period, the economic distress in the South caused by the boll weevil, and increasing job opportunities caused by the World War I mobilization combined with a reduction of competitors as immigration fell sharply because of the war.”3 This black migration paved the way for later migrations. As history attests, it was not always an easy transition and assimilation. As difficult as blacks had it during this period, a distinctly black culture developed, even in the prevalence of racist attitudes and restrictive laws. “Because Washington was a segregated city, blacks simply created their own metropolis. . . . The first black bank, the Industrial Savings Bank, was started here.” While “the black population of New York’s Harlem inherited many of its buildings from previous white owners, . . . many of the buildings in Shaw were paid for by black businessmen and built by black hands.”4 Adversity led millions of blacks to parts unknown to make a better life for themselves and their families. It can happen again.

The evacuees, local governments, and Washington politicians have a choice. They can reengineer the same failed welfare policies that trapped and warehoused the poor in New Orleans, or they can advance a strategy of personal, family, social, and moral redevelopment. This is as good a time as any to dismantle the welfare state.

2. Star Parker, Uncle Sam’s Plantation: How Big Government Enslaves America’s Poor and What We Can Do About It (Nashville: WND Books, 2003), 72.

3. Sowell, Ethnic America, 209.

4. Mark Cauvreau Judge, If It Ain’t Got that Swing: The Rebirth of Grown-Up Culture (Dallas, TX: Spence Publishing, 2000), 4.