New Orleans: I Have Seen the Future, and It's Houston

For many who love New Orleans, the changes that accompany commercial growth inspire fear—but in the meantime the city's economy stagnates and its population declines

The Superdome sprang fullblown from the forehead of one Dave Dixon, a local promoter and former car salesman. Dixon managed to sell his idea in 1965 to Governor John McKeithen. Dixon tells the story that after he described his idea to McKeithen, the governor "bolted out of his chair and said: 'By God! That will be the greatest building in the history of man. We're gonna do it!'

The Superdome did not, however, turn out to be the greatest building in the history of man, or even the second greatest. It was beset with cost overruns and political scandals. Voters in 1966 were told that the Superdome would cost $35 million, the same as Houston's Astrodome, which it would dwarf; instead, the final figure was $165 million. The Dome was supposed to make an operating profit its first year; instead, it has shown a large deficit for each of its three years of operation, and no one today seriously thinks the Dome will ever come close to paying for itself. Last year's operating loss was $5.5 million, not including debt service, which runs to $10 million a year. In fact, the Dome costs $50,000 a day to keep open—whether it is used or not.

Civic boosters in New Orleans tend to point to the Dome as the main impetus behind the city's building boom of the past ten years. It is probably true that hotel chains such as Marriott, Hyatt, and Hilton have come to New Orleans in large part because of their expectations about the Dome. But it is hard to see how the Dome can take credit for office buildings such as the sixty-story One Shell Square (an undistinguished piece of architecture, a copy of a banal Houston tower) or for the $500 million Canal Place office-condominium project which local developer Joe Canizaro is building, with help from the shah of Iran's Omran Bank, along the river at the foot of Canal Street.

At around the same time the Dome was being sold to the public, a forty-year-old financial wizard from Texas named Jimmy Jones was becoming president of the city's second largest bank, the National Bank of Commerce. Jones brought in new deposits and put the money to work with aggressive lending, much of it in real estate. While his direct, abrasive style made him lots of enemies among the city's gentry, it had a profound impact on the city's other banks—profound but brief.

After trying unsuccessfully to get the state to liberalize its banking regulations to allow New Orleans banks to branch beyond the city, Jones left town to become president of the Bank of California. Jones's own bank suffered from some of its adventuresome real estate loans, and two others, the International City Bank and the Republic Nation Bank (the latter a black-owned institution nurtured by Jones himself), failed in 1976 and 1977. These mishaps and the continuing disaster of the Superdome quickly brought the city's effort at economic renaissance to a halt. It had lasted two years.

The Carnival game

It is almost impossible to talk about the economy of New Orleans without talking about the people who are supposed to "run" the city—its gentry, its social elite. New Orleans is perhaps the only large city left in America where birth counts for so much. And it is hard to say just why—unless the answer lies in Mardi Gras, which is a highly structured social ritual rather than a pubic spectacle like the Rose Bowl Parade.

Among the critics of the social order the theory goes that Carnival parades provide bread and circuses for the masses, who scramble for beads and coins tossed from parade floats by people of privilege. There is royalty in Carnival—a careful hierarchy of krewes (or clubs) which stage balls and parades and appoint kings or queens and princesses.

The best-known krewe, Rex, holds its parade on the morning of Mardi Gras. It touts itself as the "civic krewe"; recent years Jews and non-natives and politicians have been taken into the membership. Blacks have not—but least a few of them have been invited to the Rex Ball on Fat Tuesday night. Rex is still run, however, by the gentry, and the King of Carnival comes from its ranks. This year's king was Edmund McIlhenny, a lawyer (two other members of his small law firm were past Rexes) and a member of the Tabasco family; the queen was Kitty Duncan, a Radcliffe sophomore whose father is an awning tycoon and one of the few socialites who was close to Mayor Landrieu.

Carnival is a game that almost everyone in New Orleans plays; there are sixty parading organizations, each a private club and each numbering 200 to 500 members. There is a distinct social order to the groups—the krewes of Comus (the oldest krewe and one of the smallest), Momus, and Proteus are at the very top. Like the city's leading downtown luncheon clubs—the Boston, the Pickwick, and the Louisiana—their membership is generally restricted to natives and to the circle of families that has dominated society, business, and the law here since the Civil War.

This society, it should be noted, is quite distinct from Creole society—the descendants of the French and Spanish colonists who settled mostly in the French Quarter in the eighteenth and early nineteenth centuries. The locus of Creole society was Esplanade Avenue, the downriver border of the Vieux Carré, while Mardi Gras society was concentrated in the Garden District and the uptown area around Tulane University—what was called "the American Sector," above Canal Street. Creole society is long gone now, but it doesn't hurt at all in Carnival society to have a French or Spanish ancestor.

Members of this Carnival society have little political power themselves these days: the last serious attempt by a King of Carnival to run for office was Leon Sarpy's in 1973; he was defeated for the state supreme court by Mayor Landrieu's former law partner, Pascal Calogero. However, they still dominate New Orleans's powerful non-elective boards—the Dock Board, the Board of Liquidation (which approves bond sales), and the Sewerage and Water Board (an important institution in a city below sea level).

The power of status quo

But the main power of the gentry is a purely negative one. A brash businessman from Texas, such as Jimmy Jones (or even a non-brash businessman from Texas, such as Jones's successor at the bank, Rodger Mitchell), who would have been a definite celebrity in Houston, couldn't make the Boston Club or the Dock Board in New Orleans. Along with top executives from Shell and Exon, Jewish real estate barons, and politicians, Jones would lunch at the frankly unsocial Petroleum Club or International House or the Sazerac Restaurant in the Fairmont Hotel (formerly the Roosevelt Hotel, Huey and Earl Long's haunt).

The style of these nonnatives dos not seem to mesh with that of the dean of Carnival society—men such a Richard Freeman, who owns the local Coca-Cola franchise, and Darwin Fenner, as in Merrill Lynch, Pierce, Fenner & Smith—so they aren't accepted into the inner circle. This sort of exclusion is practiced on a smaller scale every day in New Orleans, and it is cited by members of the city's Economic Development Council as a major deterrent bringing new businesses into the city.

New Orleans society is not rich or clever or fashionable or outrageous or any of the things that society tends be in more cosmopolitan cities these days. It is simply well-bred and bland and its blandness is reflected each morning in the Times-Picayune, the city's leading daily paper (the other daily is the States-Item, which has half the circulation and about a tenth the influence, though it does have a few very good writers; both the Picayune and the States-Item are owned by the Newhouse chain).

The best adjective to describe the New Orleans dailies was used ten years ago by Calvin Trillin: "discreet." One is rarely surprised by the papers, and rarely enlightened either. The dailies are not well liked in New Orleans, but they are enormously influential. "If it isn't in the Times-Picayune," says one local lawyer (influential himself), "then it hasn't happened. That's the attitude of people here."

The new mayor

Stepping into this fairly dismal state of affairs on May 1 was the new mayor, Ernest N. ("Dutch") Morial, a black man with white skin, a New Orleans Creole with a French heritage (his parents spoke French at home). Morial was the first black man to graduate from LSU Law School, the first black state legislator since Reconstruction, and the first black judge to sit on the state court of appeals. Now he is New Orleans's first black mayor and the black mayor with the largest constituency in the South.

Morial's victory last November was something of a fluke. A black man wasn't supposed to have been elected mayor in 1977, especially since black registered voters represented only 43 percent of the electorate. But in the primary, the two middle-of-the-road candidates were quite surprisingly squeezed out by two special-interest candidates: Morial, who received 60 percent of the black vote and 7 percent of the white, and Joseph V. DiRosa, a city councilman who had defeated Morial in a council race in 1968. DiRosa's appeal was to older, low-income, conservative white voters—the ones who lacked the means to move to the suburbs and who were unhappy with the way blacks and liberals had dominated Mayor Landrieu's administration.

In the end, Morial ran a surprising first in the primary, 5000 votes ahead of DiRosa, who in turn edged out State Senator Nat Kiefer by 250 votes. Morial's victory in the runoff was assured two weeks into the second campaign when he trounced the inarticulate DiRosa in a TV debate. Morial is prone to bureaucratic jargon (his favorite phrase is "I will utilize the systemic approach to government"), but he comes across on television as cool and conservative—just what fence-sitting upper-middle-class whites were looking for.

The five-and-a-half month interregnum between Morial's election on November 12 and his inauguration on May 1 was the result of an oversight: a new law had eliminated the usual January general election, but it neglected to change the inauguration date.

While the transition period gave Morial a good chance to organize his administration (he has appointed twenty citizen task forces to investigate practically every aspect of city government and a twenty-nine-person advisory board to pick a new police chief), it also caused the new mayor a certain amount of financial hardship. Shortly after the election, he announced at a press conference that he was looking for a job. Eventually, he took three: he taught a course in campaigning at the University of New Orleans, served as a fellow at the Institute of Politics at Harvard, and acted as a consultant to a local TV station (a post that brought him some criticism).

New emphases

A good deal is expected of Morial, and he may be able to deliver. While Mayor Landrieu spent most of his time trying to improve race relations, seeking money from Washington, and making a name for himself nationally, Morial soon after election addressed himself to the city's severe economic problems.

In mid-January, he made his first major post-election speech. He talked to the Metropolitan Area Committee, an establishment-oriented group of businessmen, and he talked in the blunt way that few mayors of New Orleans have had: "In our urban ills, we differ from New York, Atlanta, Newark, Chicago, Houston, Dallas, and other great cities, primarily in the fact that we have never realized our great potential. We have preferred to live in an ancient dream of economic magnificence just around the corner while thousands and thousands of our citizens have never climbed out of soul-searing poverty . . . ."

Morial closed by talking about a study made by Professor Charles Chai, formerly of Tulane, on the power structure in New Orleans. Chai's methodology, Morial said, "consisted of asking key individuals which civic leaders were necessary to insure the success of a project. He then went to these people and repeated the question, finally coming up with a three-tiered list. But what astounded Dr. Chai was the fact that a majority of people failed to mention the mayor as a man essential to the communal equation."

The fact that the mayor has not historically been very important to the running of the city has made Morial's ascension a fairly easy one, despite his race. Race relations in New Orleans are not much different from those anywhere else in the country, which is to say that the Kerner Commission's characterization of America being two nations, divided by race, is still true. For example, only 25.7 percent of black adults in New Orleans have finished high school, compared with 52 percent of whites. (Whites, by the way, abandoned New Orleans public schools when integration came in the early sixties, but in recent years many young white professionals are sending their children to integrated public schools, half black and half white, mostly in the French Quarter and uptown.)

Race relations are probably a little better here than they are elsewhere in the South for two reasons. First, blacks have lived in proximity to whites ever since the city was founded; even in the most fashionable parts of uptown New Orleans, a block of mansions occupied by whites can lie next to a block of run-down wooden cottages occupied by blacks. Second, for the past ten years blacks have had an important role in conventional city politics, playing the game the same way that white ward heelers have played it for decades. The two black political organizations that helped Landrieu get elected—SOUL and COUP—have replaced white groups such as the Choctaw Club and the MidCity Democrats as experts in City Hall patronage.

Within another few years, New Orleans will have a slight black majority in population, but whites still have a significant edge in voter registration. Numbers, of course, do not equal power in this city, and Morial realizes that he can't govern without the support of the white establishment. In fact, the gentry was quite relieved that Morial beat DiRosa, who was much more virulent in his opposition to the social order. This is not to say, however, that the gentry supported Morial in the runoff; most of the socialites sat the election out. And while most aren't racists of the crude variety, their view of blacks is decidedly archaic: one of the city's leading investment bankers was quite liberally tossing around the word "nigger" the other day in polite conversation with strangers.

Morial may fool many of these men. He could emerge as the strongest mayor in the city's history. But, in the end, there is considerable doubt whether anyone can really change things here. Very little changes in New Orleans. The city's charms endure. New Orleans remains the municipal equivalent of a banana republic, a tropical paradise where the friendly natives unload the freighters by day and pull down the tourists' beds for the evening.

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