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Forbes on FOX Guest: Louisiana So Much A Welfare State That France Looks Like the Mecca of Capitalism

Reported by Marie Therese - September 18, 2005

On the 9-17-05 edition of Forbes on FOX, host David Asman introduced the all-Forbes business panel which included Publisher Rich Karlgaard, Editorial VP Jim Michaels, Staff Writer Lea Goldman, Bureau Chief Mark Tatge, Senior Editor Mike Ozanian and Bureau Chief Quentin Hardy. It was very interesting to me that Ms. Goldman, the lone woman, was not identified in the chyron when she first spoke, yet each and every man was clearly identified the first time he made a comment. We had to wait until her second appearance to see her name in print.

The topics of the day were the aftermath of hurricane Katrina, soaring gas prices and the future of NOLA's evacuees. Clearly, Lea Goldman and Quentin Hardy represented the more liberal POV while the others generally agreed on a conservative approach. Poor Quentin Hardy got exactly one opportunity to speak very early on in the show, then dropped off the radar screen.


Some of the more pertinent commentary:

JIM MICHAELS: "You've got to be careful about overkill here. I mean, you've got all that federal money. Ya' got $65 billion at least of insurance money pouring in. As far as relief is concerned, the government's gotta spend what it takes. But when you're talking about rebuilding, the more the government gets involved in it, the more corruption, the more inefficiency and the more - just an orgy of stupidity. What the government should do is set incentives in place for the state and local governments and private enterprise to come in an do the rebuilding job."

COMMENT: Does Michaels mean the same private companies that have already bilked us out of billions of dollars in Iraq?

While the men focused on the possibilities for corruption in contracts, Lea Goldman mentioned the stark fact that this is a reconstruction effort on a par with the Civil War or WWII and therefore both the federal and state governments have to take a large role. She said "What concerns me about putting the onus on private enterprise is that you have unfettered regulations and those who were ruined by this - by Katrina - would be the least likely to benefit."

Ozanian jumped right in with what has become the FOX News-GOP-Talk Radio mantra these days. He passed the buck to the state government of Louisiana.

OZANIAN: " ... One of the big problems here is that Louisiana had become such a welfare state before this catastrophe that, I mean, it made France look like the Mecca of capitalism, OK? And what bothers me about this money being spent is that I hear nothing about the fact that they're gonna change the way the government operates down there and instead of chasing away business, instead of having, you know, proper tax codes down there, instead of bringing more permanent employment - not just after they send the money down and get this thing rolling, but ten, fifteen years from now. You know, it used to be a very hot economy down there and in the last 30 years, a lot of companies left. They went to places like Houston. What guarantees do we have that this money is not going to be squandered into making Louisiana like it was?"

QUENTIN HARDY: "Well, it's a strange day when a conservative is talking about how the federal government should come in and tell the state and local government how to run itself. But I want to circle around and tell 'ya - it ain't what you spend, it's the way that ya' spend it. Now, Rich, you compared Bush to FDR and LBJ. Those Presidents knew about the plight of the poor in America. George Bush appears to have noticed that for the first time in the past couple of days. now here he's got a fine opportunity to employ local people, give them job skills and education but I gotta tell ya', you got a President here who couldn't account for $9 billion in Iraq, who signs off on a highway bill that has a $230 million bridge to nowhere and who appears to like to employ cronies in important, critical positions.

At this point Mr. Hardy was interrupted by several voices - and (surprise, surprise!) - was never heard from again!


DAVID ASMAN: "There was one goal that the President put out which is empowering poor people, that is, giving them ownership of their homes rather than putting them back in public housing. Isn't that a good thing?"

JIM MICHAELS: "David, now you're talking! The first thing they should do, when they can, is bulldoze those public projects which are breeding grounds for crime and drugs and poverty. Bulldoze the damned things. Let private enterprise put in housing. Make those tenants owners and let the government step in by subsidizing their mortgages. The government subsidizes my mortgage and your mortgage. Why the devil shouldn't they subsidize the mortgages of the poor and the invalid?"


LEA GOLDMAN: "Jim is right but the problem is, if you offset that responsibility to private enterprise, what you're gonna end up with is condos and what you're gonna end up with is beach front property. You're not gonna end up with affordable housing. That's the bottom line. That's always happened."

ASMAN: "So, Mark, we don't want the market unfettered here?"

MARK TATGE: "Well the real problem, I think, is whether we should be spending any money at all in New Orleans. We should - if we're spending money, why don't we relocate these people to higher ground where it's not gonna flood again."

MIKE OZANIAN (shifts blame to Louisiana government): "... Louisiana was - increased spending by 51% after inflation the last ten years . that's a tremendous amount of spending, but none of that money went to proper precautions against this type of disaster. How do we know that those crooked politicians that set these people up for this catastrophe are gonna be changed and not do the same thing."

COMMENT: Whatever happened to Mississippi? The assumption by these people seems to be that money given to Louisiana - specifically New Orleans - will somehow go astray, while they never once brought up the massive damage and huge amounts of money necessary to put Biloxi and its environs back in shape. Could it be that FOX News is implying that only a Democratic-run state will abuse federal aid while Republican Mississippi under Bush buddy Governor Haley Barbour is so straight and true-blue American that they wouldn't think of misusing federal funds? Throughout the entire Katrina coverage, FOX News has harped endlessly on Louisiana and virtually ignored Mississippi's very considerable devastation.


The title of this segment was "$3 Gas: No Problem!" Mike Ozanian hopped right on the "let's drill more" bandwagon. He said: "They're getting oil from the sands in Canada. They're now going down two miles deep off of the Gulf. This is great news 'cause they'll increase supply."

Lea Goldman took the side of the consumer, declaring that "it hurts like hell" and that retail, manufacturing and most especially transportation sectors are getting clobbered by higher gas prices.

Rick Karlgaard disagreed, saying "It doesn't hurt a lot. I mean, the numbers don't support it. The GDP growth rate since gas prices have been rising has not been dinged much, if at all. If it goes to $5.00 a gallon - sure. But I'm more inclined to agree with Oz that $3 will cause a tipping point and cause oil companies to start really being aggressive about investment."

Mark Tatge piped up to say that he thought the rise in gas prices "has already started to hurt" citing decreased sales at Wal-Mart and other retailers. "It's killing the airlines," he said. "We've go two more that are in bankruptcy and airlines are trying to push through fare increases. We're gonna see a gradual increase in prices."

Jim Michaels summed it up: "Look. You haven't seen anything yet. When the snow starts to fall and the temperatures start dropping to zero, people are gonna suddenly see their heating bills go up as much as their gasoline bills, so people in the north are gonna face a double whammy this year. And sure there's no way it's not gonna impact consumer spending. The good side is that it's possible that reconstruction spending in the south will take up some of the slack."

Mike Ozanian found the silver lining in all this doom and gloom. He oozed happily that the Fed will raise interest rates which will, in turn, slow down American consumption of Chinese goods.

Rick Karlgaard predicted that the price of gas would come down because the high prices are being kept high due to speculative buying on the part of hedge funds. He referred to the pricing as a "bubble" and implied that the bubble would burst if only President Bush would tap the strategic oil reserves a second time.

Of course, SOMEONE (Mark Tatge) had to argue that we need to build more refineries and then SOMEONE ELSE (David Asman) had to mention that the onerous EPA restrictions could be lifted to facilitate construction of those refineries.

ASMAN: " ... Maybe those restrictions will be lifted by those folks inside the beltway?"

The ever blunt Jim Michaels answered that hopefully we would even begin drilling in ANWAR, but then pointed out: "That's five years down the pike. Right now, when old man winter hits, people are gonna take a real - take it on the chin in their heating bills, whether they use oil heating or natural gas."

SUGGESTION: If we need more refining capacity, why couldn't we strike a deal with Mexico or Venezuela to refurbish some refineries in their territory, perhaps ones offline for maintenance, and then lease those until the Gulf refineries can be put back online? Wouldn't this kind of cooperative effort go a long way towards mending our tattered relationships with those countries by upgrading their refineries, providing them with extra income and easing the burden on our own citizens this winter?


In the show's third segment, Forbes Senior Editor Elizabeth MacDonald reported from Houston, Texas, saying that the Katrina tragedy underscored "with ruthless cruelty" the recent census report that more and more people "have fallen under the poverty line." She noted: "The people in Houston, though, have responded with open arms. The 2nd Baptist Church has started an interfaith effort to train 42,000 volunteers, who are working throughout Houston to handle the influx of people who've come in from New Orleans and the surrounding areas. It's an extraordinary operation. They're working with Centerpoint Energy, which had a disaster plan in place to take care of these people and many of them are staying right behind me in the George R. Brown Convention Center."

Continuing FOX's deliberate, consistent, coordinated assault on Louisiana's local and state governments, Asman asked her to compare apples to oranges: "Do you see any of the kind of confusion and disorder that we saw at the Superdome there in Houston?"

Gee, what do think her answer was? In what can only be described as a complete mental disconnect, MacDonald actually pretended that there is parity between the situation in the Superdome in a flooded city two days after a hurricane and a completely planned process, weeks in the making, in an area unaffected by natural disaster.

She went into a solemn ode to Houston: "I think Houston is showing the world how to handle an evacuation effort. It's really, truly extraordinary. It's like a mini-city. They have a pharmacy, a dental station, a medical station, a diaper station. You know, these people - and the food is fantastic. It seems to me, if I were there, I wouldn't want to leave. They're serving catfish, beef and chicken, you know, fajitas. The food is extraordinary and I think, you know, what's really important, though, is that these 42,000 volunteers are trained within five days and they come from all faiths. They come from the Catholic Church, Muslims, Jewish people are stepping up and they're doing shifts inside to help people get on with their lives. There's another interesting point."

ASMAN (interrupting): "Elizabeth, let me just ask a question. Where - do the evacuees want to go back to New Orleans or do they want to start a new life elsewhere?"

MacDONALD: "You know, I asked a lot of them if they would go back and they are worried that it is effectively a toxic waste site and they worry for health reasons. They're really torn because they don't want to leave their things behind, of course, but what's another thing that's interesting here - this speaks to the housing bubble - there was a housing glut in Houston and what's going on now is that the operations here - they want to move people into housing, so they're moving them into hotels, into motels, into apartments where people are getting six months' worth of rent for free so people are going to put down roots in the Houston area. ..."

COMMENT: Wow! Looks like the philanthropy of Houston might have had a financial motivation! Of course, the Bush administration and its cronies in the real estate industry want "these people" to settle in Houston and elsewhere. Mark my words. The battle lines are being drawn between NOLA Mayor Ray Nagin, who's trying to get as many former residents of New Orleans back into the city as fast as possible, and the Bush administration, who really doesn't want "those people" back in the city at all.

What the fat cat developers want is a city plan they can sell to wealthy investors, complete with neighborhoods designed like a Disney theme park, devoid of poor people, except the "have-nots" imported from outside the city to serve the "haves."

Mayor Nagin, on the other hand, seems to understand that the "soul" of New Orleans was (and is) a direct result of its rich intermingling of class and culture.

High-priced, well-connected developers may find that the call of the bayou is stronger than all the millions in campaign contributions big developers gave to George W. Bush.

My money's on Soul to defeat Greed.

Gumbo is so much better than Velveeta and crackers!

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