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Mind boggling. How did this place function??

Teetering on the edge of the precipice, looks like. Finally went over, sadly.
Did you hear Rush yesterday?

He had this story (exerpt) which helps you understand the makeup of New Orleans:

Many years ago, an oilman in Houston pointed out to me that there was no inherent reason Houston should have emerged as the world capital of the petroleum business. New Orleans was already a major city with centuries of history, proximity to oil deposits, and huge transportation advantages when the Houston Ship Channel was dredged, making the then-small city of Houston into a major port. The discovery of the Humble oil field certainly helped Houston rise as an oil center, but the industry could just as easily have centered itself in New Orleans. When I pressed my oilman informant for the reason Houston prevailed, he gave me a look of pity for my naiveté, and said, “Corruption.” Anyone making a fortune in New Orleans based on access to any kind of public resources would find himself coping with all sorts of hands extended for palm-greasing. Permits, taxes, fees, and outright bribes would be a never-ending nightmare. Houston, in contrast, was interested in growth, jobs, prosperity, and extending a welcoming hand to newcomers. New Orleans might be a great place to spend a pleasant weekend, but Houston is the place to build a business. Today, metropolitan Houston houses roughly 4 times the population of pre-Katrina metropolitan New Orleans, despite the considerable advantage New Orleans has of capturing the shipping traffic of the Mississippi basin. Many years ago, an oilman in Houston pointed out to me that there was no inherent reason Houston should have emerged as the world capital of the petroleum business. New Orleans was already a major city with centuries of history, proximity to oil deposits, and huge transportation advantages when the Houston Ship Channel was dredged, making the then-small city of Houston into a major port. The discovery of the Humble oil field certainly helped Houston rise as an oil center, but the industry could just as easily have centered itself in New Orleans.

When I pressed my oilman informant for the reason Houston prevailed, he gave me a look of pity for my naiveté, and said, “Corruption.” Anyone making a fortune in New Orleans based on access to any kind of public resources would find himself coping with all sorts of hands extended for palm-greasing. Permits, taxes, fees, and outright bribes would be a never-ending nightmare. Houston, in contrast, was interested in growth, jobs, prosperity, and extending a welcoming hand to newcomers. New Orleans might be a great place to spend a pleasant weekend, but Houston is the place to build a business.

Today, metropolitan Houston houses roughly 4 times the population of pre-Katrina metropolitan New Orleans, despite the considerable advantage New Orleans has of capturing the shipping traffic of the Mississippi basin.

It is far from a coincidence that Houston is now absorbing refugees from New Orleans, and preparing to enroll the children of New Orleans in its own school system. Houston is a city built on the can-do spirit (space exploration, oil, medicine are shining examples of the human will to knowledge and improvement, and all have been immeasurably advanced by Houstonians). Houston officials have capably planned for their own possible severe hurricanes, and that disaster planning is now selflessly put at the disposal of their neighbors to the east.