New Orleans: A Necessary Location

George Friedman has a fascinating article in the current New York Review of Books, explaining why New Orleans must exist. Basically, an ocean port at the end of the Mississippi is crucial both to agriculture and to the manufacturing industries of the US.

A simple way to think about the New Orleans port complex is that it is where the bulk commodities of American agriculture go out to the world and the bulk commodities needed for American industrialism come in. The commodity chain of the global food industry starts here, as does that of American industrialism. If these facilities are gone, more than the price of goods shifts: the very physical structure of the global economy would have to be reshaped. Consider the impact on the US auto industry if steel doesn't come up the river, or the effect on global food supplies if US corn and soybeans don't get to the markets.

The river is simply the only way to keep these aspects of the American afloat, so to speak.

Thankfully, Friedman writes, the various facilities have not been damaged beyond repair. The key problem is that there's no-one left to work them.

The displacement of population due to destruction, disease, and pollution is the crisis that New Orleans faces. It is also a national crisis, because the largest port in the United States cannot function without a city around it. The physical and business processes of a port cannot occur in a ghost town, and right now, except for the remaining refugees, that is what New Orleans is. It is not about the facilities, and it is not about the oil. It is about the loss of a city's population and the paralysis of the largest port in the United States.

When Bush made the surprising comment that New Orleans would be rebuilt at any cost he wasn't speaking out of turn (he rarely does). The city's recovery is not solely a matter of sentiment, just as it's location was never a matter of serendipity. It was there and it'll have to be rebuilt again, as Friedman says, because a city there is a must.