According to CNN 1,833 people were killed by Hurricane Katrina and insurance companies alone lost 41.1 billion dollars. As well the government spent billions of dollars trying to repair New Orleans. History.com, the website corresponding to the popular History TV channel, estimates that in total Katrina caused over one hundred billion dollars in damages. Houses were destroyed and business were lost it was as if the apocalypse had hit the bustling city of New Orleans. Hurricane Katrina was the most devastating natural disaster to hit America. On top of this destruction Hurricane Katrina left a huge burden on the personal finances of those affected, left an impact on the economy and left an impact on the city of New Orleans that is still felt today.
Imagine this its early on the morning of Saturday August 27, 2005 your scrambling to prepare your livelihood and life’s passion for the great stormed that the news and media are warning you about. This is exactly what is happening to Laura Maloney in Douglas Brinkley’s New York Times Bestsellers Book The Great Deluge. In the his novel we are introduced to Mrs. Maloney a New Orleans resident. She was a former employee at zoo’s in Philadelphia and New York before landing a job at the Aquarium near the French Quarters in New Orleans. Once hear she met her husband Don. On a trip to the New Orleans SPCA to adopt a dog she fell in love with the idea of saving animals. So she stepped down from her then job at a mineral company to become executive director of the Louisiana SPCA. One this morning she was scrambling to move animals from their main location in New Orleans to Houston. Maloney was worried not just about the well being of the animals but also about the idea of losing the location in New Orleans which happens to also be the main office of the Louisiana SPCA. Many individuals were put in similar situations. ( Brinkley, 2007)
Michael Dolfman states that he believes job loss to be one of the biggest effects of Hurricane Katrina in his article What was the effect of Hurricane Katrina on New Orleans Economy. In the same article Dolfman tells us that in the months following the Hurricane 103,316 were lost. According to this same article in the Monthly Labor Review “46.1 percent were centered in just three sectors”. The three industry’s that had the most job loss were; retail trade which lost sixty-two point eight percent of its total employees, accommodation and food services which lost just under sixty percent of its total employees and lastly health care and social assistance which lost fifty-six point four percent of its total employees. (Dolfman, 2007)
This caused huge problems for employers and employees both. Many employers lost their business in total and thousands employees were left with no way to earn a living. A natural disaster is a terrible time to lose your job considering many people had to pay thousands of dollars to repair their homes. One story in the Hurricane Digital Memory Bank, an online digital archive, describes the struggles of home repair following the hurricane. The author of this story Richard Stone, who was eighteen at the time, tells us how expensive hurricane insurance is in the gulf area. He tells us “because hurricanes are a normal thing the owners of the house have to pay 10% of the house value before the insurance picks any of it up” (Stone). Richard estimates that his parents home was worth two hundred thousand dollars meaning his family would have had to pay twenty thousand dollars just to be insured from hurricanes. Mr. Stone tells us to “trust me we don’t just have 20,000 dollars lying around in our back pocket.” For this reason, his family did not have home insurance when the hurricane hit in the summer of two thousand and five. Stone’s family eventually found the money to fix their home but stone described the time as “one of the roughest times my family and I had ever been through”. When looking at the massive number of people that lost their jobs on top of the thousands of dollars spent on repairing and replacing belongings it is evident that Hurricane Katrina had a monstrous impact on the personal finances of the people living in the affected areas. (Stone)
As result of the destruction of homes and loss of jobs there are multiple stories of the mass migration out of New Orleans that is still felt today. One of note is by an anonymous author on the Hurricane Digital Memory bank. In the authors story titled “Moving On” they describe to us the process of how they moved on and got over the events of the hurricane. The author was luckily evacuated the day before the storm. They spent four months in Alabama working at an offsite affiliate of there job back in New Orleans before they decided to move to Oregon. Here they have stayed ever since. Although the author says “New Orleans will always be in my heart” it is evident that the author has no intentions of returning any time soon. (Unkown)
Multiple other people went through similar situations. In fact, New Orleans has yet to recover from the great migration that struck the city after Katrina. According to CNN “The population of New Orleans fell from 484,674 in April 2000 to 230,172 in July 2006”. Although the city has bounced back to a population of over three hundred thousand it is still no where near what the city use to be. One interesting thing to note is that African Americans have returned back to New Orleans at much lower and slower rates. In his article “Housing, Race, and Recovery from Hurricane Katrina” Rodney Green blames most of this on the historic settling pattern in New Orleans. In the same article Rodney tells us that African Americans made up sixty-seven percent of New Orleans population at the time of the hurricane. However, in the population that lived in the damaged areas of New Orleans African Americans made up seventy-five percent. We can also see in this article that damaged population were more likely to be poor or unemployed when compared to the total population. Meaning that it was much more difficult for these individuals to rebuild. Much of the poor population in New Orleans at this time, which includes a higher proportion of African Americans, did not have the finances built up to rebuild in New Orleans but instead had to start new jobs in new city’s. (Green, 2011)
On top of the hardship faced by those who lived in New Orleans Katrina also impacted the national economy. In an article published by Bloom Berg BusinessWeek Robert Kuttner tells us just how the hurricane will effect Americas economy. Most of the effects he predicts focuses on energy prices. Kuttner predicted that there would be “gasoline price spikes that will last for months” and that these spikes would not only increase gasoline prices but also increase electricity and heating bills. He was right that in a sense that there was an increase in gas prices but it did last for several months. According to the U.S Energy Information Administration gas prices in 2005 peaked at two dollars and ninety-five cents on September twelve just a week and a half after Katrina made land fall. Following this gas prices fell all the way down to two dollars and ten cents bellow what the had been before the hurricane made land fall. However, in the month and half time that gas prices increased we know that this must have caused increases in prices of good that must be transported long distances. We could especially predict that agricultural products that really on big gas guzzling pieces of machinery experienced an increase in price. An increase in gas increases the cost to harvest corn, which increases the price of feed, which increases the price of beef and so on.
Within his article we can see Kuttner alludes to one of the reasons he might be wrong.