Coyote Blog

Geographic mobility costs are a drag on the economy, because they slow and/or truncate relocation of labor to shifting areas of demand (a good example is the fact that North Dakota currently can't get enough workers because people can't/won't move there to take advantage of the opportunities.

Apparently, there are economists who make the argument that one reason for the post-WWII boom is that the war increased mobility for a variety of reasons, not the least of which was the forced extrication of young men from their homes via the draft.  Apparently Hurricane Katrina may have had the same effect, blasting people out of the moribund New Orleans economy and forcing them to move to more dynamic areas.

This is probably true, but also one of those areas where economic analysis falls short of total well-being analysis (for lack of a better term).  I know folks from New Orleans and they often seem to be deeply tied to the New Orleans culture and miss it when they have moved away.   Many move back.  So just because someone is better off economically with a job in Houston does not necessarily mean they consider themselves better off.

I guess I could have predicted this, but I didn't know until this weekend that a variety of conspiracy theories were circulating about the BP oil platform fire and spill, including the incredibly absurd notion that the platform was torpedoed by a North Korean submarine.

I am not a military analyst, though my sense is that a North Korean submarine would have difficulty even sailing reliably to the Gulf of Mexico.  But I do know petroleum operations.  And I can say that any petroleum facility is a playground for fire, and only unwavering, intelligent management can prevent disaster  (and even then sometimes shit happens).

It seems that, like the 9/11 truthers, the arguments are based on statements that sound plausible to laymen but in fact are meaningless.  An example:

Many have concluded that the platform sunk due to sabotage of some nature. No oil spills happened when Hurricane Katrina hit the area in 2005, they note.

While hurricanes are dangerous to oil rigs, they are something rigs are designed for.    This kind of blowout likely was due to forces at work down in the borehole, meaning that the problem was thousands of feet below the surface of the ocean, where one would not even know a hurricane was present.

This piece of evidence is funny

This conclusion has been spurred by alleged Kremlin reports that the Obama Administration has ordered a news blackout, preventing reporters from gaining access to the area or discovering information that would confirm or disprove the charges

LOL, the Obama Administration ordered a news blackout of gay protesters around the corner from the White House.

The Associated Press has an article on how the demographics of New Orleans changed post-Katrina:

Those who have moved back to New Orleans in the three years since
Hurricane Katrina devastated the city are likely to have higher incomes
and more education than people who haven't come back, demographic data
shows.

New Orleans remains predominantly black, as it was before Hurricane
Katrina struck in 2005, U.S. Census Bureau figures show. But people who
have some college education, are above the poverty line, own homes
and have no children are more likely to have returned to the city than
others, says William Frey, a demographer at the Brookings Institution
in Washington.

The city was 59 percent black in 2006, the most recent census
figures available, compared with 68 percent in 2005. Census data shows
20.6 percent of New Orleans residents were below the poverty level last
year, compared with 24.5 percent in 2005.

OK, the fact that the demographics of New Orleans have changed coincident with the Katrina evacuation  is a fact.  It is based on probably the best demographic data available, though it is not clear that Mr. Frey has the evidence at hand to separate the effects of economic growth in New Orleans from migration patterns in explaining the drop in people below the poverty line, but I will cut him some slack compare to this next statement:

"The people who have come back are the people with the best resources
to come back," said Frey, a demographer at the Brookings Institution in
Washington who has studied the demographics of New Orleans. "The people
who have not come back are lower-income, minorities, largely renters.
They were the least equipped to come back and have not been able to."

This is a guess.  The data Mr. Frey is working with sheds no light on the reason certain groups did not return.  His statement that they did not come back because they did have the resources to do so is an unproven hypothesis.  I could easily offer a counter-hypothesis, that the issue was that these folks did not have the resources or the knowledge to leave New Orleans to find opportunities to escape their poverty, and having been granted the unique opportunity by the Katrina evacuation to get out, they have found opportunity elsewhere and see no reason to return to the place where they were formerly impoverished.  I actually think my hypothesis is more likely than Mr. Frey's, but in the end both of us are guessing.

The AP does a great job in this story reporting absolutely everything but the most important fact:

The Supreme Court has refused to offer help to Hurricane Katrina
victims who want their insurance companies to pay for flood damage to
their homes and businesses.

Wow, those insurance companies suck, and they have the Supreme Court in their pocket.  The only teeny-tiny fact missing is that the people suing had policies that very explicitly did not cover flood damage.    They sortof acknowledge this but say the insurance companies should pay anyway, because the flood was caused by a broken levee and that somehow is not really the same kind of flood, sort of.  Or whatever. 

I have had experience on several occasions attempting to bring private solutions (at no cost to the city government) to certain municipal problems.  The general approach to such offers, which seems to be similar in every city I have lived in, is to get together a meeting of every single government authority that could possibly have some tangential jurisdiction over the particular problem (e.g, city, county, state, highways, parks, water, environment, etc. etc.).  In this meeting, the discussion goes around the table, with every single participant adding another reason why the proposal is a problem and/or another roadblock or required approval.  This is not an exaggeration - I can't remember one person in such a meeting try to fix a problem or make something happen.  Everyone in government has an incentive system, it seems, that revolves around avoiding risk and preventing change. 

That is why I know that this story is typical of government, not an aberration:

LSU hospital officials began planning for a temporary network of
neighborhood clinics in early November 2005, barely two months after
Hurricane Katrina knocked Charity Hospital out of commission and threw
health-care services for many of the city's uninsured into disarray.

Eight months later, in late June and early July, FEMA delivered the
trailers to New Orleans, with the $761,000 bill picked up by the
federal government.

It wasn't until last week that the New Orleans City Council agreed
to temporarily waive the city's zoning code to allow the trailers to be
located at six schools around the city -- three on the east bank and
three in Algiers -- for two years.

In between fell more than 100 meetings and dozens of e-mails about
the issue involving LSU executives and officials at the city, state and
federal levels. And the journey is not over. The zoning waivers still
need approval from Mayor Ray Nagin, which cannot occur until next week
at the earliest, as well as permits from the city that could take up to
six months to acquire.

For the past 6-months, gas station owners have been under attack by state regulators for their pricing practices just after Katrina, when fears of shut-in Gulf oil production and refining capacity led to a temporary spike in gas prices.  Gas station owners have tried to patiently explain about supply and demand and market dynamics, but to no avail, and are starting to settle:

Sunoco Inc. became the second oil company to
settle a price gouging lawsuit brought by New Jersey authorities,
agreeing to pay $325,000 but admitting no wrongdoing....

As part of a state probe into all oil companies doing business
in New Jersey, more than 100 violations were found at 400 gas
stations in the first week of September, the most common of which
were prices being raised more than once every 24 hours, and
stations showing different prices at the pump compared to their
posted prices, officials said.

Nobody is really getting fined hundreds of thousands of dollars for changing their prices more than once in a day.  Gasoline retailers are getting fined for being unliked, and because politicians find it a populist boon to their reelection to wack on oil companies every once in a while.  One of the reasons that gasoline retailers get fined for petty crap like this is that they are the only retail industry that I know of that actually posts their prices so you can see them on the street when you drive by.  A while back we also highlighted this funny bit of high-handedness in Illinois:

Illinois State Attorney General Lisa Madigan asked 18
operators whose prices jumped significantly after Hurricane Katrina to
donate $1,000 to the American Red Cross or risk a potential consumer
fraud lawsuit, reports the Chicago Tribune.

And you just knew enemy-of-Antarctica and Aspiring Governor Eliot Spitzer couldn't miss out on the populist fun:

Illinois isn't the only state to go after retailers for
price gouging after Hurricane Katrina; New York Attorney General Eliot
Spitzer fined 15 operators $10,000 for pumping up their prices.

Anyway, I guess we still haven't gotten to the "consistency" thing I mentioned in the title.  Having been at the receiving end of such ill-conceived and populist price-gouging and anti-trust lawsuits, what is the gas station trade group doing this week?  Why, appearing in front of Congress to accuse someone else of price-gouging.  In this case, they have dragged credit card companies in front of Congress to demand action on interchange fees:

All consumers pay more at the store and at the pump" as
a result of high interchange rates, added Mierzwinski. He also noted
that "legally suspect" practices have led to market power of the card
associations, and that banks engage in a variety of deceptive practices
to steer customers toward higher transaction fees, such as charging
customers who use PIN debit, as opposed to signature-based debit, which
is much less secure yet carries a higher transaction fee to the
retailer.

Of course, he is all for free markets, as he says with this pious piece of BS:

I believe in the light of day and I believe in free
markets," noted Armour, in explaining what retailers are--and
aren't--seeking with regard to interchange. He stressed that retailers
are not requesting price caps and price controls, but rather a better
understanding of why U.S. interchange rates are so high.

Right.  Then why are we dragging these people in front of Congress, except that you want to use the coercive power of government to change their business practices?  If you have Ralph Nader's PIRG behind you, then you are looking to weild the government's hammer to achieve something you couldn't achieve through free, voluntary association and negotiation.

As a retailer, credit card companies piss me off too, but I don't run to Uncle Sam for relief.  I just don't accept certain types of cards, like ATM cards with PIN verification, since they cost a fortune in fees.   And in a lot of locations, I don't accept cards at all.  We have put ATM's onsite in a lot of places, reasoning that if consumers want debit card convinience, they can pay the fees by using the ATM machine and then paying us in cash.

This holiday season, several gasoline retailers found extortion notes from the state AG in their stockings.  In Illinois:

Illinois State Attorney General Lisa Madigan asked 18
operators whose prices jumped significantly after Hurricane Katrina to
donate $1,000 to the American Red Cross or risk a potential consumer
fraud lawsuit, reports the Chicago Tribune.

I would define consumer fraud as getting something from a retailer different than was promised.  I am not sure how it is fraud if retailers put their prices on a great big sign right on the street, and then actually charge those prices as promised.  Unfortunately, we seem to have filled positions of political power with the economically ignorant, who are stuck on cost-based pricing:

"When we're in an emergency situation, such as we were,
retailers have the obligation not to increase their prices to the
general public over what wholesalers are charging them," Hagan told the
Associated Press.

Uh, why?  Retailers move their markup around all the time.  Most every retailer has drastically higher markups on December 1 for Christmas tree ornaments than they do on December 27, but no one seems to complain.  Workers increased the price of their labor post-Katrina, sometimes by a factor of three, and their costs weren't going up at all, so why weren't they gouging?  Its just bizarre how we treat gasoline so much different than every other product we buy.  Perhaps its because they are the only retail product that actually posts their current prices right on the street. 

As I read this article, AG Hagan reminded me of my least favorite Aspiring Governor, fellow Princetonian and enemy-of-Antarctica Eliot Spitzer.  So it was funny when the article continued on to discuss similar actions taken by Spitzer.  This was the quote I loved:

Spitzer told the Press & Sun-Bulletin that
he "hoped it would send a clear message to others that 'you cannot,
under New York law, use an environmental emergency to raise prices.'"

OK, but can I use a massive supply-demand imbalance caused by an environmental disaster to raise prices?  And I sure bet that politicians can use an environmental emergency to raise taxes  (in fact, since NY's gas tax is a percentage of the price rather than fixed, the state of NY did indeed contribute to the post-Katrina price hike). 

Here is my quote back to Mr. Spitzer:

"I hope to send a clear message that the state Attorney General position cannot be used for grandstanding forays against innocent but unpopular business entities* in order to raise one's profile to run for higher office"

*See Dick Grasso, Microsoft, et al.

Update:  More at Professor Bainbridge on Elito Spitzer  (and here)

Jason McBride was arrested for selling gasoline at too high of a price during the shortages that followed Katrina, under an Alabama anti-price-gouging law.  What was the legal price he violated?  Well, the law doesn't actually set a price maximum, it just makes you liable to be arrested if a random government bureaucrat feels like your price is too high.  Mr. McBride followed up with more information on his original story to Christopher Westley at the Mises Blog:

I recently heard from Jason McBride, who was the subject of my last Mises.org
article, "The Right to Set Your Own
Price". McBride, a gas station owner from Aliceville, Alabama, was arrested
for violating Alabama's "anti-gouging" law on the day that Hurricane Katrina
slammed into the Gulf Coast.

Jason told me that there was more to the story than what had been reported in
the newspapers. He said that the price he charged for a gallon of gas that day
was actually $3.49 (not the $3.69 that was reported) and that he purchased that
gas that very day for $3.29 a gallon. He said that this information was provided
to the district attorney during his investigation.

But there's more. Jason told me that he sold gas for only three hours at the
$3.49 price until he received a call of complaint from the D.A.'s office. His
response was to shut down his pumps until the the State of Alabama contacted him
with a "correct price." His pumps were shut down for 18 hours until the
state told him he could sell gasoline for $3.09 a gallon. This happened in the
midst of a crisis when consumer demand for gasoline increased dramatically.

Despite his bending over backwards to comply with the law, and despite zero
evidence of malicious intent, the district attorney's office still arrested him.
His picture was on the front page of a state newspaper the next day (while, he
pointed out, a report on a murder was relegated to page 6).

Gee, why isn't the Congress doing something about this price gouging in a scarce commodity post-Katrina?

Burger King is offering a $6,000 signing bonus to anyone who agrees to work for
a year at one of its New Orleans outlets. Rally's, a local restaurant chain, has
nearly doubled its pay for new employees to $10 an hour...

On any given day, contractors and business owners pass out flyers in
downtown New Orleans promising $17 to $20 an hour, plus benefits, for people
willing to swing a sledgehammer or cart away stinking debris from homes and
businesses devastated by Hurricane Katrina ...

"I'd say I'm paying two to three times as much as I would in normal
circumstances," said Iggie Perrin, the president of Southern Electronics, a
supplier in New Orleans, who has offered as much as $30 an hour when seeking
salvage workers on Canal Street...

In a remarkable example of an anti-business hit-piece called "Fueling Contempt" on the front page of the AZ Republic, the Republic leads with this line:

Reaction to major oil producers' staggering profits ranges from rage at
the pumps to calls for profits to be reinvested in exploration,
alternative-energy research or simply returned somehow to the public.

The article is mainly focused on the profit announcement at Exxon-Mobil, so I will use their numbers to put "staggering" into context.  E-M announced profits of $9.9 billion on sales of $101 billion.  For those who cannot divide, that is a profit margin of 9.9% of sales.  Since when is a profit margin at a cyclical peak of 9.9% considered "staggering"?  Microsoft makes 30%, in good times and bad, with a fraction of the investment or risk X-M takes.  From this chart, you can see the average for all industry is about 8%, with the oil industry generally below this number in all but cyclical peak quarters and banks, pharma, software, semiconductors, financials, household products and many others all consistently over 10%.  Procter and Gamble makes a margin of nearly 13% of sales selling toothpaste and detergent but we are going to begrudge oil companies 7.6% on average and 10% in their best quarters?

The article does absolutely nothing to put the profits in their proper context, though I was able to do it in one paragraph.  This is the only context the article offers:

The oil companies assert that their profits are no larger than other
businesses and that they just look big because it is a big business.

Exxon Chairman Lee R. Raymond said in a statement that the company
"acted responsibly" in its pricing and said its fourth-quarter profits
would come nowhere close to the $9.9 billion in the third quarter.

That doesn't necessarily wash with Adrienne Valdez of Phoenix.

"I can't afford to buy socks because I am paying twice what I used to
for gas," she said. "It's not right that they should be making billions
at our expense."

In Phoenix, gas prices soared to $3.14 after Hurricane Katrina hit the
Gulf Coast. The average Valley price per gallon, which has been falling
in recent weeks, was $2.72 Thursday, according to AAA Arizona.

Bruce Trushinsky, owner of the former Moon Valley Exxon station at 1901
W. Thunderbird Road in Phoenix, called Exxon Mobil's $9.9 billion
quarterly profit "disgusting."

He became so upset at the $7.6 billion profit posted by the company in
the second quarter that he canceled a longtime branding agreement.

"I ripped down all the Exxon signs and threw them in the garbage,"

he said. Now, after 30 years, Moon Valley Exxon is Carmel Automotive
and Fuel. Trushinsky said the high wholesale prices charged by Exxon
were devastating to his business and that the last straw was when the
company canceled its dealer-incentive program.

"They cut us off, then they announced their (second-quarter) profit increased $2 billion."

This is populist crap, and is the reason the MSM cannot be taken
seriously when they say that they are neutral reporters.  They are not
reporting, they are cheerleading an anti-oil company bigotry that has
existed for decades.  I think that the E-M management should be embarrassed to make such a small return in their best quarter.  Shareholders should take management to the woodshed for investing and risking so much in a cyclical business and making so little.  For gods sakes, they make a lower margin than Jif peanut butter earns.  Is anyone suggesting that we impose a windfall profits tax on Charmin?

I find the title of the article "Fueling Contempt" interesting - I am not sure if it was meant to refer to high oil company profits or if it was just a statement of intent for the article.

UPDATE:

Since 1977, governments collected more than $1.34 trillion, after adjusting for
inflation, in gasoline tax revenues"”more than twice the amount of domestic
profits earned by major U.S. oil companies during the same period

This is just gasoline taxes - it does not include income tax payments, property tax payments, and oil lease royalty payments.

My liberal in-laws always give me this strange condescending look whenever it comes up that I have voted for a Republican at some point in time, that same look you might give the otherwise beloved family dog that keeps pooping on the front lawn.  As a libertarian, I seldom fully agree with any political candidate of either party.  Every election is a tradeoff:  Do I vote for the unelectable and perhaps truly odd Libertarian candidate?  Or do I vote for a mainstream party with which I disagree with about half of everything they promote?

So here is how I normally make the decision:  On pure self-interest.  Since, as a small business owner, I am much more likely to need strong protection of property rights than I am going to need an abortion, a gay marriage, or legal marijuana, I end up voting Republican more often than I vote Democrat.  For this reason, the Republican party has generally garnered a good many libertarian votes, and the two most identifiable libertarians in Congress (Flake and Paul) have both called themselves Republican, though I am sure with some reservations.

This relationship, however, may be at an end as Republicans are disavowing their libertarian wing, and returning to their large government tendencies of the 1970's.  Bush and his buddy Tom Delay are turning out to be classic Nixon Republicans.  The most recent evidence comes from the fact that the following is not from our Republican President, or our Republican Speaker of the House, but from the for-god-sakes Washington Post:

But this spirit of
forbearance has not touched the Louisiana congressional delegation. The
state's representatives have come up with a request for $250 billion in
federal reconstruction funds for Louisiana alone -- more than $50,000
per person in the state. This money would come on top of payouts from
businesses, national charities and insurers. And it would come on top
of the $62.3 billion that Congress has already appropriated for
emergency relief.

Like looters who seize six
televisions when their homes have room for only two, the Louisiana
legislators are out to grab more federal cash than they could possibly
spend usefully. ...

The Louisiana delegation has apparently devoted little thought
to the root causes of the Hurricane Katrina disaster. New Orleans was
flooded not because the Army Corps of Engineers had insufficient money
to build flood protections, but because its money was allocated by a
system of political patronage. ...

The Louisiana bill is so preposterous
that its authors can't possibly expect it to pass; it's just the first
round in a process of negotiation. But the risk is that the
administration and congressional leaders will accept the $250 billion
as a starting point, then declare a victory for fiscal sanity when they
bring the number down to, say, $150 billion. Instead, Congress should
ignore the Louisiana bill and force itself to think seriously about the
sort of reconstruction that makes sense.

The Republicans are lost.  Combine this kind of spending with their Patriot Act and Sarbabes-Oxley driven Big-Borther-Is-Watching intrusiveness, luke-warm committment to free-trade, and bizarre , and I find nothing at all attractive about the party.  Only the economic insanity of the opposition party continues to keep Republicans in power. 

More on the Louisiana money grab here.

Following up on posts here, here, here, here, and here is yet another in a series on government preference for control over results, this time via Overlawyered.com:

In the midst of administering chest compressions to a dying woman
several days after Hurricane Katrina struck, Dr. Mark N. Perlmutter was ordered
to stop by a federal official because he wasn't registered with the Federal
Emergency Management Agency. "I begged him to let me continue," said Perlmutter,
who left his home and practice as an orthopedic surgeon in Pennsylvania to come
to Louisiana and volunteer to care for hurricane victims. "People were dying,
and I was the only doctor on the tarmac (at the Louis Armstrong New Orleans
International Airport) where scores of nonresponsive patients lay on stretchers.
Two patients died in front of me.

"I showed him (the U.S. Coast Guard official in charge) my medical
credentials. I had tried to get through to FEMA for 12 hours the day before and
finally gave up. I asked him to let me stay until I was replaced by another
doctor, but he refused. He said he was afraid of being sued. I informed him
about the Good Samaritan laws and asked him if he was willing to let people die
so the government wouldn't be sued, but he would not back down. I had to
leave."

In a formal response to Perlmutter's story, FEMA said it does not accept the
services of volunteer physicians:

"We have a cadre of physicians of our own," FEMA spokesman Kim Pease
said Thursday. "They are the National Disaster Medical Team. ... The voluntary
doctor was not a credentialed FEMA physician and, thus, was subject to law
enforcement rules in a disaster area."

So for those of you who draw the conclusion from Katrina that we need more big government rather than less, that would help.... how?

Technorati Tags:  Katrina

Preface:  Over the years, technocrats have always had a distaste for capitalism.  Their desire has always been the curb to bottom-up disorder and inherent chaos of succesful capitalism with top-down order and control.  In the early half of the 20th centruy, the leading economic argument against capitalism was technocratic-fascist:  That capitalism and competition were wasteful and disorderly and should be replaced with a more orderly state control.  The ultimate legislative result of this thinking was FDR's National Industrial Recovery Act, his emulation of Mussolini-style corporate fascism which was fortunately struck down by the Supreme Court.

While numerous large-scale failures of state economic control have mostly beaten back the technocratic argument, we can still see the fundamental failure of this approach in the last few weeks with the government's handling of the Katrina recovery:

A few days ago I had thoughts on top-down vs. bottom-up approaches to hurricane relief.  After watching the relief effort over the last couple of days, I am more convinced than ever that part of the problem (but certainly not all of it) with the relief effort is the technocratic top-down "stay-in-control" focus of its leadership.  Take stories like this:

Lots of
people including yours truly have volunteered to bring (including food,
generators, food, etc., to be self sufficient for a week or so) the most
important thing which is a boat but have been told NO under no uncertain terms.
"My" town is under water, people are in critical condition, and I have skill
sets and assets - including a boat which will come out of the hole in 14 inches
of water - and we are being denied the opportunity to help. And quite frankly,
that REALLY PISSES ME OFF.

And this:

A visibly angry Mayor Daley said the city had offered emergency,
medical and technical help to the federal government as early as Sunday
to assist people in the areas stricken by Hurricane Katrina, but as of
Friday, the only things the feds said they wanted was a single tank
truck.
[...]
Daley said the city offered 36 members of the firefighters' technical
rescue teams, eight emergency medical technicians, search-and-rescue
equipment, more than 100 police officers as well as police vehicles and
two boats, 29 clinical and 117 non-clinical health workers, a mobile
clinic and eight trained personnel, 140 Streets and Sanitation workers
and 29 trucks, plus other supplies. City personnel are willing to
operate self-sufficiently and would not depend on local authorities for
food, water, shelter and other supplies, he said.

While turning down offers to help, when everyone agrees not enough is being done, may seem unthinkable, these are actually predictable outcomes from a bureaucracy of technocrats.  Technocrats value process over results, order and predictability over achievement.  More important than having problems fixed is having an ordered process, having everything and everyone under control.  In this context, you can imagine their revulsion at the thought of having private citizens running around on their own in the disaster area trying to help people.  We don't know where they are!  We don't know what they are doing!  They are not part of our process!  Its too chaotic! Its not under control!

Nearly everyone who is in government has a technocratic impulse - after all, if they believed that bottom up efforts by private citizens working on their own was the way to get things done, they would not be in government trying to override those efforts.  But most emergency organizations are off the scale in this regard.  99% of their time, they don't actually have an emergency to deal with - they are planning.  They are creating elaborate logistics plans and procedures and deployment plans.  Planners, rather than people of action, gravitate to these organizations.  So, once a disaster really hits, the planners run around in circles, hit by the dual problem of 1) their beautiful plans are now obsolete, since any good general can tell you that no plan ever survives first contact with the enemy and 2) they are by nature still planners, trying to get order and process underway and create a new updated plan, rather than just getting every possible resource out there fixing the dang problem.

The army has had to deal with this conundrum for years.  How do you have soldiers who are good planners before a battle, but men of action and initiative once the battle is underway?  How do you run a fundamentally top-down organization such that when it matters, individuals will take the initiative to do what needs to be done?  Its a really hard problem.

Unfortunately, I fear that the lessons from this hurricane and its aftermath will be that we need more top-down rules and authority rather than less.  It is the technocrats on the sidelines who are most appalled by the screw-ups, and will demand more of whatever next time.

Here is an example of what I think we should do instead.  Let's accept that we can't plan for everything, can't have every resource stockpiled for an emergency, and that our biggest resource is our private citizenry.  Let's provide rules of engagement for 3rd parties to come into the disaster area and help with minimum supervision.  There might be different rules for trained rescue people and untrained private citizens.  Here is an example of the type of thing that might work better:

Every private citizen with a boat larger than X and a draft less than Y who would like to help can bring their boat and three days food and clothing to such and such boat ramp.  All municipal firefighters and rescue teams that want to help, come to such and such building, check in, and we will assign you a sector.  Rescue crews need to bring their own food, equipment, and waterproof paint to mark the buildings you have searched.  Then, go out to the boat ramp, find a boat and driver in the pool there, and go.  FEMA will bring in a fuel truck to refuel boats and will indemnify all boat owners for damages.  All survivors found should be brought back to the dock, and ambulances will be standing by.

Update: OK, I know some of you don't believe that this is a control issue for the bureaucrats.  Well, here is more evidence, from the Red Cross web site, via Instapundit.

Hurricane Katrina: Why is the Red Cross not in New Orleans?

• Access
  to New Orleans is controlled by the National Guard and local
  authorities and while we are in constant contact with them, we simply
  cannot enter New Orleans against their orders.
• The state Homeland Security Department had requested--and
  continues to request--that the American Red Cross not come back into
  New Orleans following the hurricane. Our presence would keep people
  from evacuating and encourage others to come into the city.

Update #2:  Still reluctant to believe that control over the process is more prized by bureaucrats than results?  Try this, from CNN and via Instapundit:

Volunteer physicians are pouring in to
care for the sick, but red tape is keeping hundreds of others from
caring for Hurricane Katrina survivors while health problems rise.

Among
the doctors stymied from helping out are 100 surgeons and paramedics in
a state-of-the-art mobile hospital, developed with millions of tax
dollars for just such emergencies, marooned in rural Mississippi.

"The
bell was rung, the e-mails were sent off. ...We all got off work and
deployed," said one of the frustrated surgeons, Dr. Preston "Chip" Rich
of the University of North Carolina at Chapel Hill.

"We have
tried so hard to do the right thing. It took us 30 hours to get here,"
he said. That government officials can't straighten out the mess and
get them assigned to a relief effort now that they're just a few miles
away "is just mind-boggling," he said....

It travels in a convoy that includes
two 53-foot trailers, which as of Sunday afternoon was parked on a
gravel lot 70 miles north of New Orleans because Louisiana officials
for several days would not let them deploy to the flooded city, Rich
said....

As they talked with
Mississippi officials about prospects of helping out there, other
doctors complained that their offers of help also were turned away.

A
primary care physician from Ohio called and e-mailed the U.S.
Department of Health and Human Services after seeing a notice on the
American Medical Association's Web site about volunteer doctors being
needed.

An e-mail reply told him to watch CNN that night, where
U.S. Health and Human Services Secretary Michael Leavitt was to
announce a Web address for doctors to enter their names in a database.

"How crazy is that?" he complained in an e-mail to his daughter.

Dr.
Jeffrey Guy, a trauma surgeon at Vanderbilt University who has been in
contact with the mobile hospital doctors, told The Associated Press in
a telephone interview, "There are entire hospitals that are contacting
me, saying, 'We need to take on patients," ' but they can't get through
the bureaucracy.

"The crime of this story is, you've got millions
of dollars in assets and it's not deployed," he said. "We mount a
better response in a Third World country."

Update #3:  Yes, there's more.  The Salvation Army has also been blocked, and the reason?  Their efforts did not fit snugly into the technocrats plans (via Cafe Hayek):

As federal officials tried to get some control over the deteriorating
situation in New Orleans, chaos was being replaced with bureaucratic rules that
inhibited private relief organizations' efforts.

"We've tried desperately to rescue 250 people trapped in a Salvation Army
facility. They've been trapped in there since the flood came in. Many are on
dialysis machines," said Maj. George Hood, national communications secretary for
the relief organization.

"Yesterday we rented big fan boats to pull them out and the National Guard
would not let us enter the city," he said. The reason: a new plan to evacuate
the embattled city grid by grid - and the Salvation Army's facility didn't fall
in the right grid that day, Hood said in a telephone interview from Jackson,
Miss.

"No, it doesn't make sense," he said.

Update #4:  I can't help myself.  Here is another:

The Fox News Channel's Major Garrett was just on my show extending the
story he had just reported on Brit Hume's show: The Red Cross is
confirming to Garrett that it had prepositioned water, food, blankets
and hygiene products for delivery to the Superdome and the Convention
Center in the immediate aftermath of the hurricane, but were blocked from delivering those supplies by orders of the Louisiana state government, which did not want to attract people to the Superdome and/or Convention Center.

Update #whatever-I-am-up-to: Welcome Instapundit readers!  I have posted a follow-up on big government and disaster preparedness here.

Technorati Tags:  Katrina, Economics

Now that Hurricane Katrina has moved inland, it's time for the next stage of preparation - preparing for the onslaught of global warming activists ready to use New Orleans' devastation to justify government intervention in the economy.  Heck, some global warming activists tried to blame the earthquake induced SE Asian Tsunami on global warming.

For the last couple of years, the meme has circulated that hurricanes are getting worse, and that this is a predictable result of global warming.  More destructive hurricanes may or may not be a result of global warming -- I don't know, and I challenge any climatologist who thinks they can make a definitive prediction on hurricane forces based on a half degree change in global temperatures. 

What is fairly clear is that hurricanes are not actually getting worse.  Damage from them is getting worse, but that is more of a function of building a lot of expensive structures close to the water over the last 30 years.  And it is particularly true in New Orleans, which relies on massive pumps operating 24 hours a day to keep the city above water on a good day.  Patrick Michaels has more on the hurricane meme here, including a disturbing tale of the religion of global warming trumping good science.  Where I am on global warming here.  More on global warming activism overcoming the scientific method here.  I will never forget this quote from Steve Schneider of the NOAA:

We have to offer up scary scenarios, make simplified, dramatic
statements, and make little mention of any doubts we have. Each of us
has to decide what the right balance is between being effective and
being honest.