The Foreclosure Report

New Orleans On 'Economic Canvas'

Remember when speculation was that the hurricanes would create a bonanza in Louisiana? An update, "Loren Scott and LSU economist Jim Richardson went public with the two-year economic outlook they annually prepare. So dismal was the news that Scott was almost apologetic as he announced hurricanes Katrina and Rita 1) wiped out 11 years of statewide job growth, 2) rolled New Orleans' population back to 1965 numbers, and 3) will keep the Crescent City on the economic canvas for the foreseeable future."

"My guess is Scott was unusually glum because he, like everyone else who understands how economies work, knows the financial future of this state is linked to the recovery of New Orleans. Baton Rouge may now be king, but it won't be much of a kingdom if the city that care, and apparently Congress, forgot doesn't come back to life."

"Just wait until early next year when banks come out with their fourth quarter financials. The news won't be pretty and some smaller institutions will fail under the weight of bad debt."

"Tt's incredible to hear state lawmakers complaining about cuts to their local projects as the state scrambled to address a $1-billion shortfall in tax revenue caused by the storms. Moreover, the state faces a $3.7-billion tab from the federal government. Let me ask these numbskulls a question: If you're not willing to give up pet projects in Zwolle or Rayne, how in the hell do you expect a Congressman from Peoria or Walla Walla to give up his pork for New Orleans and Louisiana?"

"Note to Congress: Pass Richard Baker's proposal to create a government-backed corporation that will buy property ruined by the hurricanes and redevelop it. Not only will it return housing to the area, but also it will be a huge help to banks facing huge mortgage defaults."

posted by Ben Jones @ 10:41 AM