Monday, November 14, 2005

New Orleans businesses struggle to survive

New Orleans companies like Hubig's Pies might fail if they can't resolve their cash flow problems. The Small Business Administration commendably changed its policy recently, allowing private banks to handle applications. That should get money in the hands of businesses sooner. Nevertheless, many business owners say they can't handle any more loans. Business owners who have business interruption insurance should be able to fill the gap, but are finding that process to be slow and frustrating as well. If insurance companies don't quickly get money in the hands of business owners, what's the point of having interruption insurance in the first place?

As a result, confirming estimates quoted earlier:

Michael Olivier, secretary of the state Economic Development Department, told a special U.S. Senate field hearing Monday that he estimates that four in 10 of the state's businesses -- nearly 81,000 -- will fail if they don't get money soon.

Hubig's Pies owner Andrew Ramsey is determined to keep the business afloat, but his sentiments explain why, with every single day that local, state, and federal leaders fail to act on a plan to rebuild New Orleans, people are deciding they can't survive here:
Every hour of every day that we don't have the ability for someone to find a job, they're going to find a job in Atlanta or wherever they are. They're not waiting around to make pies if when they call, I say, "I don't know." Ramsey said.

As I've said elsewhere, it's time for our leaders to get off their asses and do something.

Paul Krugman agrees that the response to Hurricane Katrina is a disgrace:
Disaster sometimes gives you an opportunity to rethink your premises and really go out and do something that becomes a model for future policy. What strikes me is that nothing is happening post-Katrina. There’s no sign of planning, there’s no sign of urgency, there aren’t even any discussions over how we should handle reconstruction. I just think that, faced with a genuine policy challenge that wasn’t part of their pre-existing agenda, the Bushies just lost interest. Where is the plan for reconstruction? We’re in the process of forgetting all about the Gulf Coast.

If the Bush administration and Congress can't keep New Orleans from collapsing after a natural disaster, hoping that Americans are losing interest, can any city really depend on the federal government to help in the event of another natural disaster or a terrorist attack?

Hat tip YRHT and 2millionth web log.


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