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San Francisco is a vibrant, competitive city with a world class port and a spectacular natural setting. Sure it has problems, the biggest of which is probably the cost of housing. That is a tribute to the vitality of the place. A lot of people want to live there. A quake probably wouldn't change that, at least not for long.
(Mind you, I don't want to live there. I was there once, for one day, and that was enough. As far as I can tell, coastal Cali is just one long traffic jam and I can do without it.)
So suppose a quake wrecked SF. We'd bulldoze the wreckage, toughen up the building standards, and private investors -- individuals and businesses both -- would snap up the land. The city would be rebuilt very rapidly. It wouldn't look the same and the neighborhoods would be rearranged, but the location is too desirable to pass up. We wouldn't be sitting around waiting for the government subsidy machine to do all the work. It wouldn't be necessary.
Now we come to the important point that most folks overlook. In at least one important respect, EXACTLY the same thing has already happened in New Orleans as would happen in SF after another quake. The economically viable parts have already been fixed. The Mississippi River and Gulf Coast ports are vital. The Port of New Orleans is just one of several and is actually rather far down the list, but the regional port complex is huge and important. The ports were up and running very quickly post-Katrina. Government didn't have to do much. The same is true of the refineries and offshore drilling platorms. These suffered major damage but they have been put back into operation as fast as the crews can repair them.
The point is, if it's really important, it gets fixed.
What then is the problem in NO? Well, as noted above, the economically significant things are already back in business. What we are stewing about now is the "legacy" city -- all the relics of a bygone age, colorful but no longer economically viable. New Orleans is a city in serious, long-term decline. The legacy city was subsisting on fumes even before Katrina. Why rebuild this?
I am not being disrespectful to New Orleans. There are many cities in decline. Suppose the New Madrid fault broke and wiped out East St. Louis, which is the biggest urban joke in the country unless things have changed recently. Would we rebuild it or say good riddance? How much of the other St. Louis -- the big one -- would we rebuild? Probably more, but not all of it. Suppose Godzilla emerged from Lake Michigan and stomped Gary and East Chicago into the ground. (Could we be so lucky?) Would we rebuild them in more-or-less their current form? Not a chance.
Here's the unified field theory of all this:
Most cities grow initially for location-dependent reasons. Most of the biggest ones historically have been ports. Pittsburg is where it is because it was cheaper to move the iron ore to the coal than the other way around. The economics of transportation are a common denominator in most cases.
However, if the city prospers and grows, it then acquires two more things. The smaller but more prominent of these is the "endowed sector." Perhaps "status sector" is a better term. This consists of the universities, museums, theaters, orchestras, philanthropic and civic good works of all kinds. These institutions exist because of the wealth created by the primary economy but over time they acquire a gravity and staying power of their own. Their location is an historical accident but they are often too big to move easily so they become fixtures of the landscape.
In addition, the city acquires a service economy, the location of which is utterly arbitrary. There are the shopping malls, groceries, restaurants, dry cleaners, realtors, construction firms, fast food joints, etc. They exist simply because there are a lot of people around to buy things, but they could be anywhere. Move the people, and they will move as well.
One of the interesting things that happens as cities age is that sometimes the original, location-dependent rationale disappears or at least erodes in significance. When this happens, the city may continue to thrive if its existing infrastructure and civic amenities continue to make it a desirable location for location-independent businesses. But aside from the sunk cost of infrastructure, there is really no reason for anyone to be in that particular location any longer. As long as I don't need a deep water port, there are a lot of places I can put my widget factory or outlet shopping center.
In the modern American, service-dominated economy, most people work in this third sector. This is what has been displaced in New Orleans. There is absolutely no reason the strip mall economy has to be in location X instead of location Y. And there is a very good reason not to spend huge sums of money trying to reverse Mother Nature's handiwork. If large numbers of people want to come back to the New Orleans area, fine. But move the strip malls, movie theaters, and McDonald's to higher ground a few miles back from the river. Granted, that may not be within the city limits of historical New Orleans, let alone the lower Ninth Ward, but that is irrelevant. Build somewhere safe. If people want to tempt Mother Nature, let them do it with their own money.
P.S. Just so you know I'm consistent on this: I'm one of those cranks who is opposed to subsidizing rebuilding on barrier islands and coastal strips on the Atlantic Coast as well. Every time we get a big hurricane, the cry goes up that it's dumb, dumb, dumb to rebuild the condos on the barrier islands. And it is. It's just as dumb to rebuild NO below sea level.
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