After The Fall: Saving Capitalism From Wall Street—and Washington

by Nicole Gelinas

In the Republican response to President Obama’s speech last night, Louisiana governor Bobby Jindal could have used his state’s searing Hurricane Katrina experience as an object lesson in the proper role of limited government in a relatively free-market economy. Sadly, the Katrina story he told made exactly the opposite point.

Jindal noted that Republicans have an “honest and fundamental disagreement” with Democrats about “the proper role of government.” Regarding the public sector’s ability to rescue Americans from the economic storm, he said, “those of us who lived through Hurricane Katrina—we have our doubts.” Jindal told how, in the immediate aftermath of the 2005 storm, he went to visit Sheriff Harry Lee (now deceased) and found him yelling into the phones. Lee had learned that volunteers in boats were ready to go out and help, but that “some bureaucrat” had told them they couldn’t do so without insurance and registration. The sheriff told the boaters to “ignore the bureaucrats and go start rescuing people.” From this tale, Jindal concluded, America should realize that “the strength of America is not found in our government” but in the “enterprising spirit” of regular people.

The problem with Jindal’s story—and one reason why Republicans are in so much trouble now—is that reasonable people don’t consider providing critical, life-saving support for starving and dehydrated people after an unprecedented natural disaster to be an example of scarily big government. That’s just minimally competent government, even in a country far less developed than ours. In fact, Jindal’s story illustrates the opposite of what he intended. Lee, a longtime government official, personified the functional, nimble government that we need. He overrode unnamed bureaucrats and told volunteers that he’d be personally responsible if they ran into any more trouble. Lee made a smart decision on the fly and saved lives. Unfortunately, other officials—at all levels, with only a few exceptions—proved shamefully negligent in their responses. Because they failed at their jobs, people died.

After the immediate danger receded, government still had a big role to play in setting the stage for private-sector recovery in New Orleans. The Army Corps of Engineers dredged thousands of tons of debris from clogged waterways so that private-sector firms could restart operations along New Orleans’s wharves. Government-paid contractors cleared an entire city of rubble, much of it yards deep, so that people could start rebuilding their homes. And National Guardsmen started to patrol the empty city to give residents a minimal measure of safety as they returned to their properties (since the local police force and justice system were ineffective—another government failure that the private sector can’t compensate for). When things worked right after Katrina, which wasn’t often, it was because government performed its essential function—providing infrastructure and public safety—so that the enterprising people Jindal mentioned could rebuild.

But there’s a back story here, too. Katrina became a catastrophe in the first place because of an avoidable failure of public infrastructure. New Orleans would never have flooded so thoroughly after Katrina if the levees and floodwalls that the Army Corps of Engineers had built—and which state levee boards were responsible for maintaining—hadn’t collapsed under the force of a storm that they were supposed to be able to withstand. The levees failed because even in a region vulnerable to catastrophic hurricanes, nobody—at the federal, state, or local level—seemed to believe that spending wisely on public infrastructure should take precedence over myriad other goals. At the federal level, in particular, entitlements and social spending have crowded out rational infrastructure investment.

So Jindal, from acute personal experience, had the street cred to tell conservatives and moderates something like this: “Louisiana knows what happens when a nation neglects its critical physical infrastructure. It has already paid a horrible price. And the stimulus bill that the president has just signed fails the people here. The bill’s authors have pretended that its infrastructure funds will make up for chronic neglect of infrastructure around the country. In reality, the bill’s paltry allocation to real infrastructure won’t even begin to make up for years of disinvestment. We have got to fix our budget so that the government can afford to pay for the twenty-first-century public infrastructure that the private-sector economy needs. If we don’t do this, we risk falling further behind other countries at best, and we risk people’s lives at worst.”

Americans don’t see abject government incompetence as an argument for no government. They see it as an argument for a government that is at least passably competent at fundamental tasks. Republicans do the country a disservice by not recognizing this truth. And since some Democrats seem to confuse Americans’ desire for a competent government with a desire for a government that does everything—a disastrous misstep in the opposite direction—Republicans need to provide a rational counterweight.

Nicole Gelinas, a City Journal contributing editor and the Searle Freedom Trust Fellow at the Manhattan Institute, is a Chartered Financial Analyst.