The report is entirely correct in saying that there will be a lot of economic activity, i.e. money changing hands from insurance companies to the insured to Home Depot, etc. Also the gov't will be spending money to rebuild roads, etc.
I didn't see anything stated here that syas we haven't had a huge hit to the total wealth of the nation. Since the thrust of the article was that New Orleans was needed to keep the economy of the great interior going, it wasn't essential to point out the great loss we've taken; the loss is implicit in the need to rebuild.
The BWT theory only applies if you claim the loss of New Orleans is a net positive after rebuilding and not acknowledging the foregone possible other uses of our savings.
What this article claims is that, given that NO is gone, that rebuilding NO is a better choice than other use of our savings.
I was actually responding to all the posters who WERE invoking the broken window theory, not the article itself.