A Monument to Disaster

by DOUG THOMPSON

When all the post-mortems over the incredible FUBAR called local, state and federal response to the Hurricane Katrina tragedy publish their last word, one sad fact will remain: You can’t protect people with giant federal bureaucracies.

Among the many missteps and mistakes that will forever haunt the failed presidency of George W. Bush, creation of the giant, and ineffective, Department of Homeland Security will stand forever as a monument to madness.

Most of the fingers pointed at the ineptness of federal response to the Katrina tragedy are aimed at the Federal Emergency Management Agency but FEMA lost any effectiveness once the Bush administration chose to transfer it into the black hole called DHS. Doing so destroyed a tight little federal agency whose sole responsibility was to respond quickly in times of national emergency and aid victims of hurricanes, tornados, earthquakes and floods.

Then Bush screwed up even more with the cronyism that has marked his lackluster Presidential career – installing a hack like Michael Brown as head of FEMA. Brown’s so-called credentials for the job included getting canned from an Arabian horse owners association and having a connected college roommate. Bush likes to hire fools who failed at their previous jobs. This is the same President who picked John Ashcroft to be attorney general after he lost a Senate re-election bid to a dead man.

But FEMA’s problems go much deeper than just having an idiot as its boss. Originally created to replace the civil defense agencies of the cold war era, FEMA became a tight-knit, autonomous government unit with the power and ability to respond quickly in times of natural disaster. When hurricanes struck Florida, FEMA trucks were first on the scene. When tornados leveled Midwestern towns, FEMA arrived quickly and set up shop.

That changed after 9-11 when America turned into a police state and the Bush administration created the nation’s largest – and least effective – bureaucracy to run it, bundling FEMA and 21 other smaller federal agencies into the Department of Homeland Security. Bush wasn't alone in this madness. He had the help of both Republicans and Democrats in Congress who voted to approve his bad idea.

FEMA fell far down the organizational ladder, lost funding and personnel, and became just a cog in a bureaucratic machine that has neither the organization nor the ability to respond quickly in times of emergency.

While FEMA should, and could, have been the federal government’s first responders to New Orleans and other parts of the Gulf Coast, it couldn’t because it no longer has the ability to operate on its own. It must wait for approval to go through the many layers of a federal bureaucracy that cannot, and will not, respond quickly to an emergency.

And if the bloated Department of Homeland Security cannot protect American citizens from a hurricane that gave us plenty of advance warning before roaring ashore last week, how in the hell can we expect it to protect this country the next time a terrorist attacks without warning.

The sad truth is that it can’t – and won’t. What we saw in New Orleans this past week is just a preview of what will follow the next time a terrorist organization pulls off a large-scale attack on American soil. Creating a useless monolith like the Department of Homeland Security doesn’t protect Americans. It only protects political jobs, wastes enormous sums of taxpayer dollars and puts every citizen of this country at greater risk.

FEMA screwed the pooch when it came time to prove it could do its job but the real failure lies with the people who call the shots at DHS and the path for blame for creating this monument to disaster routes through the office of every member of Congress to voted to create it and then stops at the desk in the Oval Office at 1600 Pennsylvania Avenue.

© Copyright 2005 Capitol Hill Blue

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The Red Cross and Amtrak

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The State and the Flood

From: http://www.mises.org/story/1902 The Ludwig Von Mises Institute

by Llewellyn H. Rockwell, Jr.

"No one can escape the influence of a prevailing ideology," wrote Ludwig von Mises, and Gulf Coast residents know precisely what it means to be trapped — ostensibly by a flood but actually by statist policies and ideological commitments that put the government in charge of crisis management and public infrastructure. For what we are seeing in New Orleans and the entire Gulf Coast region is the most egregious example of government failure in the United States since September 11, 2001.

Mother Nature can be cruel, but even at her worst, she is no match for government. It was the glorified public sector, the one we are always told is protecting us, that is responsible for this. And though our public servants and a sycophantic media will do their darn best to present this calamity as an act of nature, it was not and is not. Katrina came and went with far less damage than anyone expected. It was the failure of the public infrastructure and the response to it that brought down civilization.

The levees that failed and caused New Orleans to be flooded, bringing a humanitarian crisis not seen in our country in modern times, were owned and maintained by the Army Corps of Engineers. The original levees surrounding this city below sea level were erected in 1718, and have been variously expanded since.

But who knew that a direct hit by a hurricane would cause them to break? Many people, it turns out. Ivor van Heerden of Louisiana State University, reports Newsday, "who has developed flooding models for New Orleans, was among those issuing dire predictions as Katrina approached, warnings that turned out to be grimly accurate. He predicted that floodwaters would overcome the levee system, fill the low-lying areas of the city and then remain trapped there well after the storm passed — creating a giant, stagnant pool contaminated with debris, sewage and other hazardous materials."

Newsday goes on: "Van Heerden and other experts put some of the blame on the Mississippi River levees themselves, because they channel silt directly into the Gulf of Mexico that otherwise would stabilize land along the riverside and slow the sinking of the coastline."

He is hardly some lone nut. National Geographic ran a large article on the topic last year that begins with a war-of-the-worlds scenario and reads precisely like this week's news from New Orleans. It is the Army Corps of Engineers that has been responsible for the dwindling of the coastline that has required the levees to be constantly reinforced with higher walls. But one problem: no one bothered to do this since 1965. That's only the beginning of the problems created by the Corps' levee management, the history of which was documented by Mark Thornton following the last flood in 1999.

Only the public sector can preside over a situation this precarious and display utter and complete inertia. What do these people have to lose? They are not real owners. There are no profits or losses at stake. They do not have to answer to risk-obsessed insurance companies who insist on premiums matching even the most remote contingencies. So long as it seems to work, they are glad to go about their business in the soporific style famous to all public sectors everywhere.

And failure of one structure has highlighted the failures of other structures. The levees could not be repaired in a timely manner because roads and bridges built and maintained by government could not withstand the pressure from the flood. They broke down.

And again, it is critical to keep in mind that none of this was caused by Hurricane Katrina as such. It was the levee break that led to the calamity. As the New York Times points out: "it was not the water from the sky but the water that broke through the city's protective barriers that had changed everything for the worse.... When the levees gave way in some critical spots, streets that were essentially dry in the hours immediately after the hurricane passed were several feet deep in water on Tuesday morning."

Indeed, at 4pm on Monday, August 29, all seemed calm, and reports of possible calamity seemed overwrought. Two hours later the reports began to appear about the levee. A period of some twelve hours lapsed between when the hurricane passed through and when the water came rushing into the city. There is some dispute about precisely when the levees broke. Some say that they were broken long before anyone discovered it, which is another outrage. There was no warning system. There is no question that plenty of time was available between their breakage and the flooding to enable people to make other arrangements — and perhaps for the levees to be repaired. People were relieved that the rain subsided and the effects of Katrina were far less egregious than anyone expected.

That's when the disaster struck. The municipal government itself relocated to Baton Rouge even as the city pumps failed as well. Meanwhile, the Army Corp of Engineers apparently had no viable plan even to make repairs. They couldn't bring in the massive barges and cranes needed because the bridges were down and broken, or couldn't be opened without electricity. For public relations purposes, they dumped tons of sand into one breach even as another levee was breaking. But even that PR move failed since most helicopters were being used to move people from spot to spot — another classic case of miscalculation. Many bloggers had the sense that the public sector essentially walked away.

But the police and their guns and nightsticks were out in full force, not arresting criminals but pushing around the innocent and giving mostly bad instructions. The 10,000 people who had been corralled into the Superdome were essentially under house arrest from the police who were keeping them there, preventing them even from getting fresh air. A day later the water and food were running out, people were dying, and the sanitary conditions becoming disastrous. Finally someone had the idea of shipping all these people Soviet-like to Houston to live in the Astrodome, as if they are not people with volition but cattle.

After evacuations, the looting began and created a despicable sight of criminal gangs stealing everything in sight as the police looked on (when they weren't joining in). Now, this scene offers its own lessons. Why don't looting and rampant criminality occur every day? The police are always there and so are the hoodlums and the criminals. What was missing that made the looting rampage possible was the bourgeoisie, that had either left by choice or had been kicked out. It is they who keep the peace. And had any stayed around to protect their property, we don't even have to speculate what the police would have done: Arrest them!

Now, in the coming weeks, as it becomes ever more obvious that the real problem was not the hurricane but the failure of the infrastructure to work properly, the political left is going to have a heyday ( here too ). They will point out that Bush cut spending for the Army Corp of Engineers, that money allocated to reinforcing the levees and fixing the pumps had been cut to pay for other things, that we are reaping what we sow from failing to support the public sector.

The ever-stupid right will come to the defense of Bush and the Iraq War that has completely absorbed this regime's attention, pointing out that Bush is actually a big and compassionate spender who cares about infrastructure, while demanding that people recognize his greatness, along with all the other pieties that have become staples of modern "conservatism."

But this is a superficial critique (and defense) that doesn't get to the root of the problem with public services. NASA spends and spends and still can't seem to make a reliable space shuttle. The public schools absorb many times more — thousands times more — in resources than private schools and still can't perform well. The federal government spends trillions over years to "protect" the country and can't fend off a handful of malcontents with an agenda. So too, Congress can allocate a trillion dollars to fix every levee, fully preventing the last catastrophe, but not the next one.

The problem here is public ownership itself. It has encouraged people to adopt a negligent attitude toward even such obvious risks. Private developers and owners, in contrast, demand to know every possible scenario as a way to protect their property. But public owners have no real stake in the outcome and lack the economic capacity to calibrate resource allocation to risk assessment. In other words, the government manages without responsibility or competence.

Can levees and pumps and disaster management really be privatized? Not only can they be; they must be if we want to avoid ever more apocalypses of this sort. William Buckley used to poke fun at libertarians and their plans for privatizing garbage collection, but this disaster shows that much more than this ought to be in private hands. It is not a trivial issue; our survival may depend on it.

It is critically important that the management of the whole of the nation's infrastructure be turned over to private management and ownership. Only in private hands can there be a possibility of a match between expenditure and performance, between risk and responsibility, between the job that needs to be done and the means to accomplish it.

The list of public sector failures hardly stops there. The outrageous insistence that no one be permitted to "gouge" only creates shortages in critically important goods and services when they are needed the most. It is at times of extreme need that prices most need to be free to change so that consumers and producers can have an idea of what is needed and what is in demand. Absent those signals, people do not know what to conserve and what to produce.

Lew speaks: $24
Bush was on national television declaring that the feds would have zero tolerance toward gouging, which is another way of saying zero tolerance toward markets. If New Orleans stands any chance of coming back, it will only be because private enterprise does the rebuilding, one commercial venture at a time. Bush's kind of talk guarantees a future of mire and muck, the remote possibility of prosperity and peace sacrificed on the altar of interventionism.

Moreover, every American ought to be alarmed at the quickness of officials to declare martial law, invade people's rights, deny people the freedom of movement, and otherwise trample on all values that this country is supposed to hold dear. A crisis does not negate the existence of human rights. It is not a license for tyranny. It is not a signal that government may do anything it wants.

This crisis ought to underscore a point made on these pages again and again. Being a government official gives you no special insight into how to best manage a crisis. Indeed the public sector, with all its guns and mandates and arrogance, cannot and will not protect us from life's contingencies. It used to be said that infrastructure was too important to be left to the uncertainties of markets. But if it's certainty that we are after, there is a new certainty that has emerged in American life: in a crisis, the government will make matters worse and worse until it wrecks your life and all that makes it worth living.

Llewellyn H. Rockwell, Jr., is president of the Mises Institute and editor of LewRockwell.com.

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The Minimum Wage: Enemy of the Poor

by Jacob G. Hornberger, December 1998
Taken from The Future of Freedom Foundation: http://www.fff.org/comment/ed1298a.asp

Whenever politicians wish to score political points, they recommend raising the minimum wage. Parading as champions of the poor and downtrodden, they cry out against all those selfish and greedy employers who are paying less-than-subsistence wages to their employees.

The truth is that whenever public officials enact or raise a minimum wage, the only people who get harmed are the very people who are supposedly helped-those at the bottom rungs of the economic ladder.

In every voluntary economic exchange, both parties benefit. Each party to the transaction gives up something he values less for something he values more. If such were not the case, he wouldn't enter into the transaction.

The principle applies to labor relations. When an employer and employee voluntarily enter into working relationship, both of them benefit. The employer values the employee's work product more than he values the money he is paying the worker. The employee values the money more than he values the time and energy he is devoting to the business.

Let's assume that a certain employer offers to pay a job applicant $2 an hour and that the applicant refuses to take the job. We can assume that the applicant values his time more than he values the money.

What if the applicant offers to work for $5 an hour and the employer refuses? Here, the employer values his money more than he values the work product of the employee.

All of sudden, politicians step in with a law that requires employers to pay a minimum wage of $5 an hour. Is poverty alleviated? Is "exploitation" eradicated? Is the worker helped?

No. After all, a minimum-wage law does not force an employer to hire an applicant. The law simply says that if an employer hires an applicant, he must pay the legally established rate of $5 an hour. Which applicants will get hired? Only those workers whom an employer would have been willing to pay $5 an hour anyway.

In other words, if an employer values the money ($5 an hour) less than he values the work product of the employee, he'll hire the employee. But in such a case, the minimum-wage law is superfluous because the employee would have been hired in the absence of the law.

What if an employer values the money ($5 an hour) more than he values the person's work product? Then he doesn't employ him and, thus, the minimum-wage law has accomplished nothing.

So, what's the problem? The problem is that the minimum-wage law locks out of the labor market all of those people whose labor is valued by employers at less than the legally established minimum wage.

For example, suppose an employer and a worker both wish to enter into a working relationship at $4 an hour. The minimum-wage law prohibits them from doing so. Thus, the worker is condemned to unemployment and the employer loses the value of his labor services.

So, how would wages ever rise in the absence of minimum-wage laws? There is one and only one way that wages can rise in a society: through the accumulation of capital. With capital, workers become more productive. A farm worker who uses a tractor will produce more than his counterpart who uses a hoe. And more productivity means more money with which to pay higher wages.

Doesn't this mean then that employees are at the mercy of the kindness and benevolence of employers to pay them higher wages when they produce more? No. What motivates even the most self-seeking, profit-grabbing employers to pay higher wages is the prospect of competitors' bidding away their workers.

After all, if in the absence of minimum-wage laws, employers would pay only subsistence wages or less, then why do so many businesses today pay their employees more than the minimum wage? Competition in the labor market, not kindness or generosity, forces employers to pay the higher wages.

The key to raising standards of living then, especially for those at the bottom of the economic ladder, is (1) to prohibit governments from "helping the poor" by confiscating massive amounts of income and capital from the rich and middle class and (2) to prohibit government from "helping the poor" with economic regulations like the minimum wage.

If poverty could be eradicated with minimum-wage laws, everyone in the world would be rich. All that legislators would have to do is raise the minimum wage to match what they make. Come to think of it, why haven't they?

Mr. Hornberger is president of The Future of Freedom Foundation, which will soon publish Your Money or Your Life: Why We Must Abolish the Income Tax by Sheldon Richman.

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