NEW ORLEANS -- Huge stretches of the city are fallow: no power, no water, no sewer system, no life. Half the city workforce has been laid off, not a single public school is open, and the police department is being run by an acting chief after its former head quit. Mayor C. Ray Nagin is forced to hold town hall meetings in Baton Rouge, 70 miles away.
The litany of problems faced by New Orleans in the aftermath of Hurricane Katrina is unmatched by any other U.S. city in recent history. Billions of dollars in public and private funds are going to be spent on rebuilding New Orleans, but those efforts could be undermined by forces that have long beset the city -- a tradition of corruption and dysfunction and a weak economy that clouded New Orleans's future years before the rains began in August.
"Always broke. Worst school system in the state. Highest crime rate in the nation. Shrinking population. All the corporations have moved out," said Bernie Pinsonat, a political analyst in Baton Rouge. "Any poll I do, the rest of Louisiana thinks, 'New Orleans is a deep, dark hole, and no matter how much money we send, it doesn't seem to get better.' "
City leaders know they must change the reputation and the reality that fuels it if they are to make good on their pledge to deliver a "better" New Orleans. Danatus King, president of the city's NAACP chapter, warns against "the sins of the past and the mistakes of the past."
"We have a chance to do the big enchilada," said Bill Hines, a lawyer and former chairman of Greater New Orleans Inc., the chamber of commerce. "Let's hope we don't blow it."
The initial results have not been entirely hopeful. Nagin's efforts to take control of the laborious rebuilding process have been full of stumbles, and he has complained publicly that he is being criticized both for moving too slowly and for moving too quickly with the rebuilding.
The blue-ribbon commission he appointed to help with reconstruction is rife with internal squabbles, some of them racial, and with fears it could be reduced to irrelevancy because of the state government's own commission and the recent appointment of Donald E. Powell, chairman of the Federal Deposit Insurance Corp., to oversee federal relief work. "We're kind of a work in process," Nagin said during a recent interview.
New Orleans's fractured leadership has struggled for years to keep its finances in order and to bolster its clout in Baton Rouge and Washington, where essential decisions about the city are made. The federal government controls the city's public housing agency, for example, and state authorities set casino and hotel tax rates and also apportion the receipts.
In a recent Louisiana State University poll of 419 business executives, corruption was ranked among the worst aspects of doing business in Louisiana. Investors and managers elsewhere are reluctant to come "because they don't want to pay the corruption tax," said Rafael C. Goyeneche, president of the Metropolitan Crime Commission.
"We've seen every type of corruption imaginable," said U.S. Attorney Jim Letten, whose office indicted 44 public officials in the past fiscal year alone. He pointed to skimming, bribery and shakedowns across a spectrum of government employment: judges, police, teachers, administrators and traffic court workers.
"I honestly don't know if it truly can be said that New Orleans has measurably more corruption than other big cities," Letten said. "But I can say with some conviction that we as a culture have for far too long been exceedingly tolerant of corrupt politicians -- and that has cost us dearly."
Corruption has been so common that a citizens crime commission exists to solicit tips about shakedowns, payoffs and government thievery. Created in 1952 by fed-up civic leaders, the panel has fought a perpetual battle. Just last year, a tip from the commission led to the firing of an assistant district attorney who allegedly delivered extracurricular threats of prosecution in a private business dispute. Another led to charges against two city employees accused of selling engineering licenses.
