The areas hit hardest this week by the mega storm Sandy, particularly New York and New Jersey, are if anything more economically important, with much larger populations and a bigger industrial base. But what happened after Katrina offers evidence of how the modern U.S. economy really works — and some reason for relief.
Essentially, Katrina was a case study in how stunningly effective corporate America can be in adjusting supply chains and distribution channels to prevent obstructions from getting in the way of the flow of goods to the people who need them. I wrote that 2005 Post article, and with hindsight, the details were accurate, but the overall thrust was dead wrong: Katrina was more testament to the resilience of the American economy than its fragility.
The example that received the most headlines then was Wal-Mart, which deployed its legendarily efficient distribution to get goods to the places that were desperate for food, water and supplies for rebuilding. If “the American government would have responded like Wal-Mart has responded, we wouldn’t be in this crisis,” Aaron F. Broussard, then-president of the Jefferson Parish outside New Orleans, said on “Meet the Press.”
Days earlier, as the storm gathered force offshore, Wal-Mart’s emergency command center had begun routing to the Gulf Coast’s distribution centers the goods that would be in high demand after a disaster: flashlights and generators, of course, but also strawberry Pop-Tarts. “They are preserved until you open them, the whole family can eat them, and they taste good,” Dan Phillips, a Wal-Mart vice president for information systems, told Fortune magazine in October 2005.
From an emergency operations center in Bentonville, Ark., trucks were dispatched after the storm. Information on which roads and bridges were blocked — and the detours around them — was channeled to drivers. When a person in the field needed 10 trucks of water, an operations manner in the command center could check supplies and reply, “I can get you eight today and ten tomorrow,” Jason Jackson, Wal-Mart’s director of business continuity, told CIO magazine in 2005. “He then tells the logistics guy. This all takes place in a matter of seconds.”
Although Wal-Mart got lots of attention, countless companies exhibited the same kind of flexibility in the weeks after Katrina, ensuring that some of the worst fears of those initial days did not materialize. The farmers in the Midwest who rely on a clear channel out the Mississippi River to get wheat and corn to the global marketplace at harvest time were able to do so. There were no great banana or coffee shortages, as some had feared, after the usual import lanes were temporarily shut.