The political debris from Hurricane Katrina washed up on the shores of the Potomac this week as Congress and the Bush administration scrambled to demonstrate compassion and competence in the face of the country's costliest natural disaster.
With gut-wrenching images of death and destruction and hardship still fresh in voters' minds, congressional leaders put off scheduled votes on a round of tax cuts. The problem wasn't just the uncomfortable political juxtaposition of so many poor people who had lost everything against the wealthy investors and inheritors of large estates who would benefit from tax breaks. It was also that with the government facing as much as $200 billion in recovery and reconstruction costs, $62.3 billion of which was approved by Congress last week, this hardly seemed the time to reduce government revenue. There was also a nagging suspicion that too much tax-cutting -- along with too much spending on the war against terrorism -- may have denied the resources needed to protect the Gulf Coast from flooding and to fund emergency preparedness.
The emotional aftershocks from Katrina included anger at the sheer incompetence of government at every level and national shame and embarrassment that so much of the suffering is concentrated on those who are poor and black. The ingenuity and selflessness of businesses large and small that were able to evacuate and relocate employees, ship in supplies and restore services seemed all the more remarkable when compared with reports of command centers without power or working radios, runaway cops, misdirected medical volunteers and finger-pointing politicians. And how, we asked ourselves, did it come to pass that Bangladesh has offered relief aid to the richest nation on earth?
In the face of $3 gasoline and a lengthening list of energy surcharges, a just-signed energy policy seemed suddenly out of date. While some refineries and terminals in the Gulf resumed operations, it became clear that it would be months before all the damage could be repaired -- not soon enough, surely, to avoid big spikes in winter heating bills.
Others likely to feel the effects include farmers who face trouble getting fall crops to markets; insurers looking at covered losses of as much as $60 billion; banks with loans to companies without revenue and households without jobs; and automakers with too many gas-guzzlers to sell. The Congressional Budget Office predicted Katrina would knock as much as 1 percentage point off the economic growth rate by year's end, with 400,000 added to the unemployment rolls. And increased food, energy and construction prices could easily add another percentage point to the inflation rate.