The Mississippi delta is sinking and New Orleans was once on somewhat higher ground. Destruction of the swamplands has also made things worse.
I'm sure major changes will come out of this. The Loma Prieta earthquake resulted in the relocation of highways, the reinforcement of housing built on land fill, and a number of other measures that have made SF/Oakland much less vulnerable.
Katrina will probably result in many places being declared off-limits for housing (as along the Mississippi flood plain), a massive rebuilding project, and possibly a system of dikes or flood barriers. If nothing else, the port is too important to abandon. It will involve Federal money and work, but in this case, I think it's called for.
For one thing, NO - well, all of LA - is so corrupt that maybe getting the mitts of the local politicians off of the rebuilding effort would be a good thing. Not that this would prevent corruption, but it might make it a little harder and maybe a little more actual work on the problem at hand would get done.