The Price of Katrina

Once the storm finally passed, the floodwaters finally receded, and the levees were put into some sort of repair, Hurricane Katrina left its everlasting mark. Through its path of destruction, it left New Orleans and the surrounding areas in one of the costliest states of disrepair ever seen from a natural disaster in U.S. history. From the damage to infrastructure, to the lost jobs, to the loss of life, Hurricane Katrina left a devastating impact causing damages in the billions of dollars, hurting the area people and economy in many ways.
Hurricane Katrina left in its wake an estimated 350,000 homes either destroyed or made uninhabitable, and 34.4 billion dollars in property damage. Overall, 850,791 housing units in New Orleans sustained some sort of damage (Kirchhoff, 2005). New Orleans is surrounded by water and in many cases, it is below sea level. Although there are many protective levees and barriers in place to protect residents from storms, a powerful storm surge like the one brought in from Hurricane Katrina, can easily top the walls and leave the city trapped in a flood for weeks. Emergency officials agree that many of the buildings in these areas would not survive the winds of a high category storm in this situation (McQuaid and Schleifstein, 2002). Billions of dollars have been invested in levees, sea walls, pumping systems and satellite hurricane tracking that has saved thousands over the years (McQuaid and Schleifstein, 2002). Despite these new tools, Hurricane Katrina still managed to catch New Orleans off guard with the magnitude of destruction it brought leaving a death toll of more than 1,200 and putting tens of thousands out of their homes (Dolfman, Fortier, and Bergman, 2007). In addition to the infrastructure damage and loss of life and welfare, Hurricane Katrina had a big effect on the city’s economy, labor market, and individual businesses. During the first ten-month post-Katrina period, total employment was down 105,300 from the previous year. To go along with the loss of jobs, the total loss of wages in this same ten-month period was approximately $2.9 billion with the private sector taking $2.2 billion of that major blow to the economy (Dolfman, et al. 2007). Taking into account more than just the damages and loss of individual wages, estimates on the total economic loss from Hurricane Katrina have been set as high as $250 billion (Weinstein, 2007). These numbers include the 19 percent of total US oil production affected by the hurricane along with the hundreds of destroyed and damaged offshore oil and gas platforms and pipelines. Other economies of New Orleans that were hurt include the port of New Orleans which ranked fifth among U.S. ports in tons of cargo handled and 12th in foreign trade. The port sustained an estimated 100 million dollars in damage with another 280-300 million dollars in damage to port-dependent business (Sayre, 2006). In addition to the industrial part of New Orleans, an important and often overlooked economic loss is that of tourism. Before Hurricane Katrina, New Orleans had one of the biggest tourism industries in the U.S. that brought in 10.1 million visitors the year before the storm and created $5 billion annually.