Liberals and Conservatives Hitch Wagons to Recovery

WASHINGTON —  Both Democrats and Republicans increasingly view the battered landscape of New Orleans and the Gulf Coast as a giant laboratory for testing their competing domestic policy agendas.

Politicians and policy advocates across the ideological spectrum -- John Edwards and Newt Gingrich, the Sierra Club and the Wall Street Journal editorial page -- are trying to jump-start new ideas, and revive old ones, by linking them to the massive post-Katrina reconstruction.

For Republicans, the proposals include initiatives such as tax cuts for business, education aid that would follow students to private schools and the relaxation of federal environmental regulations.

For Democrats, the priorities include expanded housing assistance for the needy, more generous income support for the working poor and new efforts to promote renewable energy and mass transit.

What both sides share is that they see the massive reconstruction as a way to demonstrate the value of programs they hope will be adopted nationwide.

“It is once in a generation that an opportunity like this comes along, where the status quo is called into question and where the policy community and Congress can look at it, change it and improve it,” said Michael Franc, vice president for government relations at the conservative Heritage Foundation. “Given how hard it is to change that status quo ... every policy organization, every think-tanker, every ex-Cabinet officer is going to have a vision, and even a plan, of what we should be doing.”

Most observers agree the reconstruction challenge -- and the enormous federal spending it will trigger -- offers an unusual chance to test new thinking on problems such as poverty, racial segregation, education, environmental protection and urban planning. But many caution that both parties could face a backlash if they allow philosophical disputes to slow practical responses to the region’s problems -- or seek to impose rigid ideological specifications on its rebuilding.

“You have a unique opportunity here for the first time to rebuild an American city,” said former Sen. John B. Breaux (D-La.). “That means not just the buildings have to be rebuilt, but you have to address the problems of race and poverty and culture.... But New Orleans and the South [are] not going to go through the second Reconstruction, where the federal government comes down and says ‘This is what we want you to look like.’ ”

Each side has accused the other of exploiting the tragedy to revive ideas it could not advance otherwise. Yet each side also believes the recovery effort is likely to provide the most powerful engine to advance domestic policy initiatives through at least 2008.

“Both sides of the spectrum are really going to use the opportunity provided by Katrina to really begin to test some ideas that they otherwise couldn’t test,” said Leon E. Panetta, former chief of staff for President Clinton.

In some instances, advocates appear to be reaching in an attempt to attach their platforms to the reconstruction challenge.

The liberal Campaign for America’s Future recently declared that Congress “should repeal the recently passed bankruptcy bill to help families struggling with disasters.”

Similarly, the libertarian Cato Institute said the images of destitution in New Orleans demonstrated the need for President Bush’s private investment accounts under Social Security because “asset accumulation plays a vital role in escaping poverty.”

Most proposals in the hurricane’s aftermath, however, seem to blend a genuine attempt to think creatively about the response with a desire to establish precedents that could shape national policies later on.

Republicans have emphasized the long-standing party goals of reducing taxes and regulation, as well as Bush’s vision of an “ownership society.”

The plan Bush unveiled in New Orleans this month centered on a Gulf Opportunity Zone that would promote economic recovery through tax breaks for employers. He also proposed an “urban homesteading” plan that would allow poor families to build homes on vacant federal properties -- a new twist on the homeownership initiatives that have been a hallmark of his domestic agenda.

The Bush plan advanced another longtime Republican goal by proposing that displaced families could use education aid to pay for private, as well as public, schools.

Republicans familiar with White House thinking say Bush may offer more detail in some of these areas, particularly in ways to combat poverty. In the meantime, other conservatives are filling in the gaps.

Gingrich, the former GOP House speaker, has urged big tax cuts to spur investments and the appointment of an “entrepreneurial public manager” to direct planning and “cut red tape.”

Last Wednesday, the Wall Street Journal editorial page proposed centering the recovery plan on even larger tax reductions. “Why not allow the Gulf [Coast] to operate as a laboratory for a flat tax, with an 18% [income tax] rate and no taxes whatsoever on capital investment for businesses -- small and large?” the Journal wrote.

Sen. James M. Inhofe (R-Okla.), chairman of the Senate Environment and Public Works Committee, and Sen. David Vitter (R-La.) proposed legislation authorizing the administration to suspend any environmental law for as long as 18 months during the cleanup. And Inhofe has suggested that he might seek to roll back citizens’ ability to file lawsuits against federal projects on environmental grounds.

Among conservatives, the Heritage Foundation has produced the most detailed response. The Washington think tank calls for eliminating capital gains taxes on investments in the region; tax credits to help displaced workers purchase healthcare; creation of more charter schools in the Gulf Coast; and enlisting the private sector to operate roads, rail lines and other infrastructure “under contract with” the government.

“If these ideas are given a fair chance in New Orleans and the gulf area,” the foundation’s Franc said, “their popularity and success will create a momentum for expanding them elsewhere.”

While denouncing almost all GOP ideas, Democrats and liberals are detailing plans that envision much more direct government involvement. Sen. Edward M. Kennedy (D-Mass.) has taken the lead in devising a proposal for a public-private Gulf Coast Redevelopment Authority that would manage the region’s overall revival, from flood control to housing. Kennedy said he was modeling the idea on the Tennessee Valley Authority, which President Franklin D. Roosevelt created to revive that region during the Great Depression.

Edwards, the 2004 Democratic vice presidential candidate, last week also reached back to FDR to propose a Works Progress Administration that would employ displaced residents in the reconstruction of their communities.

And the Campaign for America’s Future, an advocacy group, is promoting yet another Roosevelt precedent -- a modern Civilian Conservation Corps that would employ residents to rebuild the region in a more environmentally sensitive manner.

Environmentalists view Katrina as a warning sign -- and its aftermath as a testing ground. Sierra Club officials said that the loss of wetlands, which serve as natural protection against hurricanes, demonstrated the need for greater preservation.

On the liberal website TomPaine.com, one author last week proposed accelerating the use of renewable energy sources by rebuilding New Orleans as “the nation’s largest, most sustainable solar city.”

Donald F. Kettl, a University of Pennsylvania political scientist who specializes in public administration, said many of these ideas might be worth exploring. But he warned that advocates were overestimating the extent to which New Orleans was really a blank slate -- or the degree to which the reconstruction was likely to follow a consistent ideological direction.

“We are going to rebuild New Orleans more or less where it is, so we start out with a lot of constraints on the process,” Kettl said. “It is time to put a lot of interesting ideas in the hopper, but it is certainly clear that preconceived ideological notions ... are going to prove lacking.”