Motivated by a mixture of commonsense and selfishness, a consensus is emerging that it is not wise to rebuild New Orleans to the spatial extent it had been prior to Katrina. The chicken-and-egg nature of the problem is boggling. The core is the problem of the interim: Do you allow people to rebuild in below sea-level areas prior to the reestablishment of the levees and the barrier islands, which may take decades? And in that interim where do the people live? And is it realistic for us to rebuild a city for people who have put down roots elsewhere? That's the prudence & commonsense part.
More on the necessity of rebuilding the barrier islands in Bayou Farewell : The Rich Life and Tragic Death of Louisiana's Cajun Coast. Haven't read it but it sounds interesting. The author's website — Katrina No More! And an interesting radio show on Protecting New Orleans. (Scroll down the page.)
The selfishness part is that the voters of New Orleans are a fraction of what they were 4 months ago and New Orleans has diminished political capacity to gain Federal funds because the rest of us will temporize about paying for flood-proofing areas where no one lives. (Mind, I am not saying that is right but merely observing what I think are the politics.)
Here is a post from a law professor on Ghost towns (and New Orleans) and Public Choice.
My intuition is that the federal government ought to help rebuild New Orleans in a manner that aims to support and house 100,000 (rather than 450,000) people. If more people want to live there, they will need to tax themselves in order to create the necessary infrastructure.
BTW, it's interesting that among the professions lawyers and law professors seem to be in the lead as early adopters of blogs. Is it true? If so, does it have to do with the mental thrust-and-parry which law school inculcates.
UPDATE: Some words from Alan Sullivan on the issue, though I don't believe that the "foolish plan" to which Alan refers is still being taken seriously by very many:
The post-storm analysis underscores the importance of reconsidering the foolish plan to make everything exactly as it was. New Orleans is untenable in its historic configuration. The low parts should be abandoned, and new defenses prepared only for two areas: (1) the port and old city along the Mississippi, (2) the university complex along Lake Ponchartrain. Those places are higher and more defensible. The rest of the city should be razed and allowed to go wild. That's the hard truth. If people won't face it, they'll spend stupendous amounts of money, only to lose the battle again.
What I'd add is that practical politics and human decency require the rest of us to give generous aid for serious resettlement aid. Help the displaced and current citizens of New Orleans to rebuild — but not below sea level.