Connect the Dots: "

Thursday Sept 1, 2005
Posting a little out of phase due to Labor Day holiday, and will return on Tuesday, but some things worth commenting on about the aftermath of Katrina.

People are emailing me to ask is this the start of the Long Emergency?

It is certainly an event of great significance. The effects of damage to our oil and gas infrastructure in the Gulf of Mexico is already being felt in rocketing gasoline prices and a burgeoning supply crisis, especially in the southeast. The home heating situation is becoming a crisis before householders even turn their furnaces on. Half the houses in America are heated with natural gas, which is now clocking in at $12 a unit (1000 cubic feet). It was $3 a unit in 2003. It could go to $16. Connect the dots.

The crisis at the gasoline pumps will thunder through the economy, most ominously in the bubble suburban sprawl-building sector, which adds up to over 40 percent of business activity in the US. How many people will now contemplate buying a new McHouse 32 miles outside Atlanta (or Dallas, or Kansas City, or Washington), and what will happen in the production home-building industry as a result?

What will happen in the financial sector when the no-money-down-interest-only mortgage racket ceases to generate ever more hallucinated tradable debt? What will happen to Fannie Mae and Freddie Mac, the two federal governments sponsored entities at the center of that racket, and to their sponsor, whose treasury certificates are held by nervous foreign investors? And finally what happens to a dollar hammered by high energy costs and repatriated treasury certificates?

Turning to New Orleans. . . viewing the hurricane damage on TV, it is hard not to conclude that most of the building stock in the city is irreparably ruined. One can't help feeling that the city we knew and love is really gone forever. Some kind urban settlement will remain, but New Orleans' downtown of hotel towers and megastructures may be the first comprehensive ruin of the Modernist city. Much of the stuff just outside New Orleans, and along the Gulf Coast, was largely post-war suburban fabric -- collector boulevards with their complements of fry pits, malls, muffler shops and subdivisions. We'd hope that the states of Alabama, Mississippi, and Louisiana will not undertake to rebuild them they way they were. The era of easy motoring is over now, and to rebuild suburban sprawl would be a double tragedy.

Of the desperate behavior seen in New Orleans this week, I don't have much to say right now. The significance of it is largely self-evident. The suffering of the people stuck in the Superdome is very impressive, though. One wonders at the failure of FEMA to airdrop water and food to those stuck on highway overpasses and in high-rise buildings such as Mercy Hospital. On the agenda next, I'm sorry to say: cholera and typhoid fever. I'll be back here on Tuesday.

"

(Via Clusterfuck Nation by Jim Kunstler.)