Much has been written and said about the economic aftermath of Hurricane Katrina, most of it initially about the loss of gaming taxes in Louisiana and Mississippi. Whilst this income is an important part of Louisiana’s budget, the state has to come to terms with more far reaching losses. The city of New Orleans is thought to have provided up to 40% of state revenue through income tax and sales tax, and most of the residents of New Orleans at present are not there to either work or spend.

Notwithstanding conspiracy theories that the levees protecting the city were breached on purpose to allow the clearance and redevelopment of large tracts of land in poor neighbourhoods, the flooding of New Orleans was a tragedy waiting to happen. The old French quarter suffered less damage than surrounding areas because they had the sense to build above sea level. Nowadays, with or without the contributory effects of global warming, too much residential development takes place on river flood plains and below sea level – and not just in the United States.

At Tuesday’s meeting of the Louisiana Gaming Control Board in Baton Rouge an update on the gaming industry as a result of the hurricane was on the agenda. It has been estimated that three of the fifteen Louisiana riverboat casinos are out of commission and thousands of video poker machines. The lack of revenue from the Belle of Orleans, Boomtown and Treasure Chest casinos, plus the machines, will create a hole of over $9.5 million a month in the state purse. The fact that Harrah’s New Orleans is not badly damaged is of little consolation to either the state or the operator, as gamblers will be hard to come by in the deserted city.

It is not just the speed of getting the casinos up and running again that is important for Louisiana and Mississippi. It is rebuilding the shattered tourist industry and bringing back the scattered residents, many of who may elect to rebuild their lives in other states. The final assessment of the recent events, in terms of state finances, will be a long time in coming. (E-09.14.05)

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