Where has New Orleans’ housing monies gone?

It appears that as time passes by, as the U.S. imperialist wars in Iraq and Afghanistan blunder on, and as many people continue on with their daily lives, fooled into thinking that this or any administration in U.S. capitalist society cares about workers and the poor, the tragedy of Hurricane Katrina and its aftermath recedes into the back of the collective mind.

A condemned home in New Orleans. Over 100,000 were condemed or destroyed. Only 27 families have received assistance. WW photo: Monica Moorehead

According to the Institute for Southern Studies’ Gulf Coast Reconstruction Watch, nearly 300,000 people from New Orleans alone have not been able to return. More than a year after the storm hit, hundreds of thousands along the Gulf Coast are still displaced. Some 80,000 along the Gulf Coast remain housed in FEMA trailers.

After thousands, many of them poor and Black, were left to die, billions of dollars were supposedly allocated to rebuild New Orleans, and millions more collected through private donors.

While monthly rents were greatly inflated, beyond the reach of many pre-storm residents, and as public housing units as well as private homes were demolished or being slated for demolition, many people in New Orleans had nowhere to which to return.

Of the billions of dollars allocated to rebuild homes, a lot of it has gone or is going to corporations, or being siphoned off by officials at every level.

The Road Home program, created by Gov. Kathleen Blanco, the Louisiana Recovery Authority and the Office of Community Development with the state legislature’s approval, was supposed to channel $7.5 billion to those who needed it.

It was to be the largest housing recovery program in history, providing grants of up to $150,000 to cover uninsured losses for homeowners.

From the very outset, the program was a problem for workers and the poor in the area—to say the very least. The Peoples Hurricane Relief Fund says the program is “a fraud and an attempt for developers to permanently displace working-class and poor New Orleanians.”

Furthermore, it “prevents those with modest means from rebuilding because the maximum grant of $150,000 is based on the pre-Katrina value of one’s home ... minus any insurance proceeds ... minus any FEMA grants ... minus penalties for not having flood insurance ... minus penalties for moving out of the state if the homeowner sells her/his property; thus leaving homeowners with not enough funds to rebuild.”

Of the more than 100,000 homes that were damaged or destroyed, only 27 families have received any assistance. Gov. Blanco says that, already, nearly 1,500 should have received assistance.

Almost 500 days have passed since Hurricane Katrina hit. So even if 1,500 families had received assistance instead of 27, it would not be much progress.

And this is merely the tip of the iceberg. As many people are becoming aware, much of the billions of dollars in federal monies not delivered to those who need it appears to be getting siphoned off to corporations. According to the Gulf Coast Reconstruction Watch, ICF International is to receive $756 million over a three-year period. ICF International is a corporate management company that, a year ago, had revenue totaling $177 million.

What’s more, Entergy New Orleans was given $200 million by the state of Louisiana, through federal Community Development Block Grant monies funneled through the Road Home program. Entergy is a private utility company. It received this money as a bailout.

The company was claiming bankruptcy and was given corporate welfare, though its parent company Entergy Inc. reported $777 million in net cash flow for third quarter 2006.

While millions of dollars meant for homeowners to rebuild are being pilfered, no money was set aside for renters. And half of all New Orleanians rented.

Some 5,100 public-housing units in New Orleans are set for demolition. For the Gulf Coast Reconstruction Watch, law professor Bill Quigley of Loyola University in New Orleans writes: “U.S. Housing and Urban Development, which has taken over the local Housing Authority of New Orleans, is seeking millions in hurricane relief tax credits to demolish over 5,000 apartments. Since Katrina, HUD and HANO have barred thousands of families from returning to their apartments. All the renters are African American, most are mothers and grandmothers. Some are elderly and disabled. Private apartments are out of the question as rent in the New Orleans area is up nearly 80 percent over last year.

“These apartments are safe and could have already been repaired, but almost all the maintenance workers were fired. A professor from MIT recently inspected the apartments and declared they are structurally sound and in better shape than most of the rest of the housing in New Orleans.”

The fight for New Orleans continues. It is a fight of self-determination for oppressed nations. The same struggle is taking place around the country, as gentrification grows and the poor are pushed out of their communities to the edges of metropolitan areas.

Cops, landlords and “neighborhood watch” groups are being utilized to terrorize the poor, workers and people of color so that developers can steal land and build condominiums and shopping outlets for the rich.

The difference in New Orleans is that the local ruling class of bankers and landlords used a hurricane to finish the job, on top of the storm of great poverty and degradation.