How Does Katrina Affect The Economy

ABSTRACT

Never before in the history of the United States, had this nation witnessed and suffered from such a costly and severe hurricane like Katrina, which occurred in August, 2005. This paper, based on secondary research, discusses the influences of Katrina on the American life. In particular, the findings explore and answer three questions of what this hurricane was, how it damaged the most developed country in the world and what responses were given by the authorities and the non-governmental organizations together with the criticisms of the people. Finally, the paper draws conclusion that Katrina remarkably altered the United States; furthermore, this nation must find solutions for the problems inside itself in order to avoid
Hence, there is doubt that the economy of the United States suffered its dramatic damages. The figures provided by The White House indicates that the unemployment rate doubled from 6 to 12 percent in the most influenced areas of Louisiana and Mississippi during the time of crisis which was between August and September. The salaries and wages went down sharply by about 1.2 billon dollars in the third quarter of 2005 (Chapter One: Katrina in perspective). The storm also demolished 113 offshore oil and gas platforms, damaged 457 oil and gas pipelines, and discharged almost as much oil as the Exxon Valdez oil disaster. This affected 19 percent of U.S. oil production; therefore, the cost of oil and gasoline rose considerably by 3 dollars a barrel for oil and 5 dollars a gallon for gas (Amadeo 2012). The joined effects of both Hurricane Katrina and Hurricane Rita, which made landfall soon after Katrina in the outskirt of Louisiana and Texas, resulted in the total number of 114 million unused oil barrels. This number was equal to over one-fifth of the annual output of oil production in the Gulf of Mexico (Chapter One: Katrina in perspective). Additionally, according to the reports of The Department of Energy, this powerful storm made roughly 2.5 million customers suffer from power outages (Chapter Four: A week of crisis). The damages inflicted by the hurricane in the economy can be found in the
What were the reactions and criticisms?

With such a troublesome disaster, came the troublesome issues. First of all, there were many problems in the reactions after the hurricane. In order to provide helps for the victims of the catastrophe, the United States government and other non-governmental organizations (NGOs) carried out one of the largest disaster-response operations in the history of the nation.

Government search and rescue efforts were executed by Coast Guard, FEMA Urban Search and Rescue Task Force (FEMA US&R), the Department of Defense, and other Federal agencies. The Coast Guard managed to rescue and evacuate over 33,000 people. This earned them the name the “New Orleans Saints”. FEMA US&R teams also saved 6,500 lives (Chapter Four: A week of Crisis). Furthermore, FEMA was one of the first organizations to provide housing assistance to over 700,000 citizens after the hurricane. They also paid the hotel costs for families that were homeless for months (Hurricane Katrina