When IWF did an iconoclastic panel on Hurricane Katrina and the roots of poverty, Nicole Gelinas, a financial writer with the Manhattan Institute, was one of the panelists. (Charles Murray, Star Parker, and John McWhorter were the others.) 

Our event was a year after the hurricane. New Orleans was home to rampant crime, an abysmal conviction rate for the rare offender the police actually bothered to arrest, corruption in the government, and people holding their hands out for more federal money. It appeared that New Orleans, a city whose corruption and poverty were exacerbated but not created by the hurricane, would not make a comeback.

But Gelinas has taken another look at New Orleans recently and finds it thriving. The New Orleans renaissance holds lessons for the entire country. Writing in City Journal, Gelinas notes that Hurricane Katrina may have actually helped the city: 

But when New Orleanians evacuated to places like Houston after the storm (see “Houston’s Noble Experiment,” Spring 2006), they learned an all-important lesson: cities could govern themselves well. Starting in late 2005, the exiles gradually returned to New Orleans with a new understanding that streets could be smooth, people could walk to their cars at night without fear, and school districts might actually try to educate poor kids from single-parent homes.

The shock of Katrina, it turns out, produced a surprising renaissance in citizen initiative, one result of which was widespread recognition among New Orleanians that all that federal cash wasn’t going to solve the city’s long-standing problems on its own. Instead, engaged residents have kept local politicians on their toes, making sure that they use the recovery funds to transform and rejuvenate the city. They have taught the rest of the country, still reeling from the financial and economic crisis, a lesson: how to do recovery right.

New Orleans, long a haven of racially-based grievance politics, began-slowly-to develop a different kind of leadership:

It turns out that instead of looking for a heroic potentate to work miracles from on high, New Orleanians were making smaller-scale, bottom-up changes that would truly help their city. Beginning in the same election, voters reshaped the city council: today, only one of the seven council members is a pre-Katrina holdover. More important is that the members’ résumés are subtly different from those of the old days. Fewer have community-organizing or social-services backgrounds; more have had careers in law, real estate, and management. These new members are likelier to view government as a provider of efficient public services than to consider it a weapon for social justice or a dispenser of jobs. They know, too, that city voters are paying attention in a way that they never have before. As new councilwoman Susan Guidry puts it, the biggest change in the electorate is “the level of citizen involvement” in day-to-day issues.

One of the most interesting things is the degree to which the city cut its bloated public payroll. Gelinas points out that before Katrina, New Orleans employed 7,406 full-time workers. That was cut slashed in late 2006 to 4,735, a 36 per cent cut, and hasn’t gone up significantly since. Isn’t that better than spending more “stimulus” to keep the public payroll larger than it needs to be? Who ever thought we’d be talking about the Big Easy as an urban success story?