updated 9/20/2005 9:24:10 AM ET 2005-09-20T13:24:10

Guests: Richard Wagenaar, Stephen Perry, Dave Cohen, Michael Olivier, Jim

Bernazzani

CHRIS MATTHEWS, HOST:  Fear and loathing in a flooded city.  Who should we trust in the latest battle of New Orleans?  Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.  The battle over New Orleans continues.  After initially encouraging residents to return to New Orleans, Mayor Ray Nagin suspended the reopening of the city late today.  The mayor wanted some of the residents to return, but the head of the federal government‘s response team, Vice Admiral Thad Allen, said it is too early.  And today President Bush weighed into the fight. 

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  We want this city to reemerge.  I mean, you know, as I said, I can‘t imagine America without a vibrant New Orleans.  It‘s just a matter of timing.  And there is issues to be dealt with.  I mean, you know, if it were to rain a lot, there is concern from the corps—Army Corps of Engineers that the levees might break.  And so therefore, we‘re cautious about encouraging people to return at this moment of history. 

(END VIDEO CLIP)

MATTHEWS:  So is it safe to come back?  New Orleans still lacks drinkable water and food.  And bottled water is scarce.  The environment is toxic, with the soil and remaining floodwater contaminate.  Hospitals are closed, and the 9/11 emergency system is still not in place.  And a weakened levee system could be tested by Tropical Storm Rita, which is headed to Florida today, but could turn towards New Orleans later this week. 

Louisiana Governor Kathleen Blanco is about to hold a news conference on Tropical Storm Rita in just a moment, but we begin with NBC‘s Michelle Hofland in New Orleans.  Michelle, is this press about the weather that‘s about to change down there? 

MICHELLE HOFLAND, MSNBC CORRESPONDENT:  Well, the weather is about to change down here.  The skies are sunny—the skies are clear right now, but boy, there are a lot of people worried that Hurricane Rita is going to slam into this coast. 

And I‘ll tell you what, not only is there a problem with the weakened levees and the fear about the problems with the floodwaters, but I‘ll tell you, most of these buildings here, as I flew over this afternoon, so many of them have ripped off roofs, and they don‘t have any tarps over those.  Not to mention the mental state of the people who are here in Louisiana right now.  It has been three weeks.  Most of them have not been back in their homes.  They‘re exhausted.  Add to that, the firefighters, the rescue workers, the people who have been here trying to clean up.  All the volunteers.  They are wiped out, Chris.  They‘re exhausted.  And another storm and more things to worry about, that‘s the last thing that these people here need. 

MATTHEWS:  And late this afternoon, we talked to the head of the Army Corps of Engineers on site there, and he said he can‘t be sure that even a Category 1 hurricane would not destroy the levees again and flood that city one more time even deeper. 

HOFLAND:  Well, and you know, I just spoke with the sheriff of St.  Bernard Parish.  And what he told me is he has about 1,200 people in his parish right now, a lot them contractors, environmental consultants and things like that, but also some homeowners.  He is very worried about those people.  And what he said, he is going to have a mandatory evacuation tomorrow.  He is going to order all of those people out of there.  And even the people who are in there working, you know, they‘re staying in those trailers, and that‘s the last place that these people need to be in if we get another 120-mile-an-hour winds coming through here.  So he is very concerned about the people who are in his parish, and he wants them out tomorrow. 

MATTHEWS:  When you talk to people down there this afternoon, Michelle, are they siding with the president and FEMA?  Or with the mayor with regard to this debate as to whether people should return or not? 

HOFLAND:  Well, you know, it depends who you talk to, but the ones that I spoke with said—this environmental consultant that I spoke with a little while ago, he said he can‘t believe people are allowed down in St.  Bernard Parish at all, because his guys are in white suits, masks and gloves because of this horrendous bacterial level, and he just can‘t believe people are down here just for that particular thing.  And not to...

MATTHEWS:  Michelle...

HOFLAND:  ... mention, there‘s no electricity or power or anything else. 

MATTHEWS:  Michelle, stay with us.  Louisiana Governor Kathleen Blanco is holding a press conference on Tropical Storm Rita, which is barreling down on the Florida Keys right now and could threaten the Gulf Coast midweek.  Here‘s the governor.

GOV. KATHLEEN BLANCO (D), LOUISIANA:  Is the admiral coming?  OK.  All right, if he shows up, he will.  OK.

MATTHEWS:  We have Kathleen Blanco.  She‘s the Democratic governor of the state of Louisiana.  Of course, there‘s been three main players down there.  The president of the United States, of course, George W. Bush.  He spoke to the nation from down there last Thursday night.  Of course, the governor, here she is.  And the mayor, of course. 

BLANCO:  ... the situation with Tropical Storm Rita has been over the last 24 hours, as it has been moving into the Gulf of Mexico. 

The latest information from the National Hurricane Center has this storm becoming a hurricane tonight and entering the Gulf by tomorrow.  Predictions are that this storm could reach Category 3 by the time it makes landfall later in the week.  Yesterday, it appeared that Rita would in all likelihood make landfall on the Texas coast near Mexico.  But today, the projected track of the storm has steadily been moving eastward, closer to Louisiana, with every update from the National Hurricane Center that we receive. 

Earlier today, I was in New Orleans, to celebrate the reopening of the Folgers plant, and to talk about the ways that business is coming back to life in the city and in the region.  After that, I had a very encouraging meeting.  I went to, I went immediately to the USS Iwo Jima to meet with Admiral Allen and General Honore.  There, we had a very serious conversation about the potential threat of Tropical Storm Rita to Louisiana, and we talked about the impact that this storm would have on our already strained infrastructure and resources. 

General Honore is here, and Admiral Allen may be coming in shortly, but they both agreed with me about the need to watch this storm very, very closely.  We must prepare accordingly, so that the possibility that it might hit Louisiana‘s coast doesn‘t come as a surprise, and that we find ourselves ill prepared. 

I would certainly let them speak for themselves about the actions that they are taking in response to this potential threat, but after my meeting with them, I am confident that together, we‘re going to respond to this situation appropriately. 

Mayor Nagin made a decision today to suspend re-entry of residents into New Orleans.  This is a very wise decision in light of the threat of Hurricane Rita.  Hurricane Rita may cause very serious complications to the situation in the southeastern region of the state if indeed it continues to move more easterly than was originally projected. 

The mayor very wisely decided that citizens should not be returning to New Orleans at this time, when federal, state and local assets might be needed to prepare and respond to yet another hurricane. 

Less than an hour ago, I participated in a conference call with federal, state, and parish officials from the southwest region of Louisiana.  We talked about the potential threat to this storm, and they are preparing within their own parishes to determine what kind of evacuation must take place.  And based on what I heard during this call, I‘m satisfied that our federal, state and local officials are watching this hurricane potential very closely, and they are prepared to take the necessary actions. 

Even if it doesn‘t strike the Louisiana coast directly, if the eye of the hurricane goes into our neighboring state of Texas, into the eastern side of Texas, I want to remind our citizens that we are on the east side of the hurricane, and we could potentially have the same impact that Mississippi received.  So we are still in a very dangerous place in relation to what that hurricane is demonstrating right now. 

It is for that reason and for the potential threat to the New Orleans region—because right now, we still do not know exactly where this hurricane will end up—we are taking Rita very, very seriously. 

This evening, I want to send a message to all citizens who live in coastal Louisiana, but especially those right now in the southwest region of the state.  And as the hours go on, we‘re going to be watching this, and so just keep in mind that we may be talking to the entire coast before this hurricane actually determines its final destination.  But I want citizens who are in the coastal parishes to start making preparations to leave now.  And I‘m not suggesting that you need to leave.  If you can, do so, but make your preparations.  Make thoughtful preparations.  Think about keeping your family together and on independent resources for several days.  You need to make sure that your homes are secured and that the yards are clear of any flying objects.  That will help you in the long run. 

But I am asking people to make preparations now.  Prepare your family.  Prepare your house for the possibility of evacuation.  It is never too early to make preparations.  Secure your property and plan where you will go. 

Now, we have some complications here because of the severity of Katrina and the displacement of so many of our citizens in southeast Louisiana.  One particular concern regarding this storm and the potential evacuation of yet another region of Louisiana is the intense strain it will have on the shelters throughout both Texas and Louisiana. 

Now, remember, this storm is currently projected to impact Texas—the Galveston, Beaumont, perhaps Houston area—so our people cannot plan to go into Texas.  Our people cannot plan to go to the New Orleans area.  And southern Mississippi has been impacted. 

You must go north.  You must go north, into central or north Louisiana.  You need to hopefully connect with family or friends and get out of harm‘s way. 

Our shelter task force is hard at work on contingency plans to deal with the possibility of another mass evacuation.  There will be more in the coming hours and days about the details of that plan. 

The State Department of Social Services is working with FEMA and the Red Cross and drafting a plan to deal with this challenge.  While we hope and pray that Rita does not gain strength and threaten our coast, the prudent course of action is to prepare for the worst.  If Rita...

MATTHEWS:  That‘s Governor Kathleen Blanco of Louisiana calling for the citizens of her state of Louisiana to prepare for the worst.  She is encouraging them to make preparations to leave the coastal areas.  She said she‘s taking hurricane—I guess it‘s going to be Hurricane Rita—very, very seriously.  She is saying the latest weather reports suggest that Hurricane Rita may well be to a Category 3 by the time the storm reaches the coast, and therefore, even though it is still a tropical storm, if it reaches Category 3, as we‘ve all learned in the last couple of weeks, that‘s serious business in terms of the levees of New Orleans, which we‘re going to hear later in this show—because we had an interview earlier today—they‘re not able to take maybe even a Category 1, according to the Army Corps of Engineers.  So if it hits a Category 3, look out. 

So the governor is doing a very smart job here, it seems to me, of warning people as to the worst. 

Let‘s go to Michelle Hofland, who‘s on the ground in New Orleans.  Well, that was a sobering report from the governor of this state, Michelle, right? 

HOFLAND:  Yes, it was.  And you know, she‘s telling people to prepare to go.  The question is, Chris, where to go?  The hotels around here are booked.  Well, there aren‘t any open here in New Orleans, but outlying areas that we have checked, there are no rooms at all because of all the people who have evacuated from around New Orleans and in the other areas that have been hit by this hurricane.  And everyone that I‘ve talked to does have a standing house.  Their house is filled with other people.  There are 20 people staying with them. 

So you know, I‘m wondering, where are these people going to go unless they have friends that are up in the northern part of the country?  Because there‘s just not much place to go around here, Chris. 

MATTHEWS:  Well, it sounds like she‘s aware of that.  She went through all the problems that people have seeking refuge.  They can‘t go to southern Texas.  They can‘t go to New Orleans.  They can‘t go to Baton Rouge.  It‘s packed.  They‘re going to have to move further up the Mississippi, well up to the top of the state, as well as to the top of Louisiana.  It looks to me like they‘re going to have to visit their cousins. 

The interesting thing is, she didn‘t quite say evacuate.  I want to tell everybody who is watching right now who is affected by this.  She said, prepare to evacuate.  She said, get yourself together, supplies you might need for a long stay somewhere.  But you don‘t necessarily have to leave. 

I think by tomorrow morning, we‘re going to get a better report.  She did say that the weather report, each one following the other, shows the storm getting closer and closer, away from Texas to the landfall perhaps right there in New Orleans.  Another direct hit.  And that‘s what she was talking about.  Another scary prediction here tonight from the governor of Louisiana, that her state may be the hardest hit again. 

Anyway, thank you very much, Michelle Hofland in New Orleans. 

Coming up, after Katrina, should New Orleans be reopened for business?   And is it safe for residents right now and tourists?  Well, not because of Rita, but maybe bigger reasons than that.  We‘ll be back with a top FBI special agent in New Orleans.  You‘re watching HARDBALL only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Jim Bernazzani is the FBI special agent in charge in Louisiana.  He joins us now from Baton Rouge. 

Jim, I met you last week when I was down there. 

Let me ask you about this standoff between the mayor down there—there seems to have got a truce on it, a cease-fire on it late today—but a standoff as to whether it is right to go back into the city.  Let‘s listen to the mayor right now, Jim.

(BEGIN VIDEO CLIP)

RAY NAGIN (D), MAYOR OF NEW ORLEANS:  We are suspending all reentry into the city of New Orleans as of this moment.  I am also asking everyone in Algiers to prepare to evacuate as early as Wednesday.  I am also asking anyone who is on the east bank of Orleans Parish to also start to prepare yourselves to evacuate on Wednesday. 

(END VIDEO CLIP)

MATTHEWS:  In a security situation—I should say, in terms of security, safety of the streets down there, who is right, the federal government or the mayor, in terms of this standoff? 

JIM BERNAZZANI, FBI SPECIAL AGENT:  Well, relative to the FBI mission, irrespective of who is coming in two or who is leaving, the mission does not change. 

The FBI here is to support DHS, the federal lead, the New Orleans Police Department, Louisiana State Police, in making sure the community is secure.  If we have movements of peoples, they just provide unique opportunities to execute operations.  But the fact of the matter remains that the FBI mission has not changed.  We will continue to track down violent criminals and remove them within the legal construct, while, at the same time, setting up task forces to sense anomalies relative to white-collar crime and fraud. 

MATTHEWS:  Let me ask you about the street situation.  We have had the 82nd Airborne down there.  I met them down there.  They‘re very impressive.  More importantly, they‘re impressive to people who might think of criminal actions, because, apparently, for whatever reason, these guys armed with camouflage and M-16s intimidate criminal behavior. 

Once they are removed from the site, are we facing more stressful situations for homeowners and property owners? 

BERNAZZANI:  Well, I don‘t think so. 

I think our intelligence assessment is going to tell who is in town and how much of a problem we have.  Relative to violent criminals, one of four things happened.  They either drown, they are under arrest, they are holed up in areas where we can‘t get to them as quick as we could because of the water, or they are out of town. 

And the FBI, with our law enforcement partners, has put together an intelligence assessment designed to track these individuals, to give us a baseline of intelligence, of knowledge, to understand the threat picture and understand the environment.  And, right now, we have a window of opportunity to set this up, because most of the violent criminal activity we believe has either been neutralized or is out of town. 

MATTHEWS:  What about the elements—and I am not saying how many there were, but there are criminals, armed criminals, who were stalking the Superdome.  Where did they go? 

BERNAZZANI:  Well, we are in the process right now, again, of—with an intelligence assessment designed to locate these individuals. 

We have information indicating certain individuals are in select cities.  And we have notified those local police departments.  You have got to understand, Chris, prior to the storm, relatively speaking to per capita, New Orleans was the murder capital of the world.  It was a very violent city. 

And with our law enforcement partners, we did an intelligence assessment that identified both the top 100 most violent individuals in New Orleans. 

MATTHEWS:  Yes. 

BERNAZZANI:  That intelligence assessment has been pushed to all 56 field offices with instructions to get with state and local law enforcement to begin the process to assess the displaced community from New Orleans to determine if any of those individuals, amongst the large numbers of law-abiding citizens, represent a problem for them and, if so, take appropriate action with the state statutes. 

MATTHEWS:  OK. 

Let me ask you about—give me a design, if you can, of the kind of crime you have had in New Orleans all these years.  Is it, like we had here in D.C. for a number of years, and still do, a crack business which is all based on violence and turf and people kill each other to keep their peace?  Is it like that? 

BERNAZZANI:  Yes, it is like the Southeast back in the early ‘90s. 

What we have here is a large youth population with no opportunity.  And when you introduce automatic weapons, which are relatively new, the AK-47S and the SKS‘s, as well as crack cocaine, it is the only opportunity for these individuals to improve what they perceive to be a lousy quality of life.

MATTHEWS:  Right. 

BERNAZZANI:  And there also is a perception in the community that the state judicial system has failed them.  If you look at the state judicial system last year, relative to the incarceration rate of convictions, it stands, incredibly, at 7 percent. 

And when the community feels the state judicial system has failed them, a second judicial system kicks in, street justice. 

MATTHEWS:  Right. 

BERNAZZANI:  And the killings beget the killings beget the killings. 

And that is what we have right here. 

MATTHEWS:  Yes.  I am one of these people that compares the number of people killed in Washington with the number of convictions for murder.  And always I find it frightening to realize that a huge percentage of the killers are walking past me every day.

We will be right back with Jim Bernazzani of the FBI.

Up next, when will New Orleans be ready for residents and tourists to return?  That is still the hot question still in dispute. 

That‘s next when HARDBALL returns.

(COMMERCIAL BREAK)

MATTHEWS:  Back to HARDBALL. 

We are back with Jim Bernazzani, who is the FBI special agent in charge of the New Orleans division. 

Jim, it is great having you on the show. 

What do you think was about this fight between the president, the FEMA on one side and the mayor of New Orleans about whether to let people back in?  Where were you guys on—where was the FBI on that issue? 

BERNAZZANI:  The FBI was on the streets working investigations. 

Irrespective of the agreement between the mayor and FEMA, the FBI‘s mission will continue.  And that is, it runs the gamut from countering the next terrorist attack, to getting these violent criminals off the street, to ensuring that well-intended individuals who wish to donate are donating to real charities, and not some individual who is setting up a false Web site. 

MATTHEWS:  “The American Political Almanac,” which we all use in politics, I‘m holding a copy of it here.  It is almost like our Bible.

It reads, “Louisiana often seems to be America‘s banana republic, its public sectors sometimes laced with corruption.”

How would you rate the public sector down there in terms of cleanliness?  I‘m talking about the mayor‘s office, the parish presidencies, the governor‘s office, the rest of it? 

BERNAZZANI:  Well, as far from the FBI office, we have a tremendous working relationship with all government, whether it is state, federal or local, whether it is law enforcement or it‘s from the mayor‘s office or from the parish presidents. 

We have no problem with that.  What we do have here, unfortunately, is a target-rich environment relative to select individuals who would abuse their office for personal profit.  Within the FBI, New Orleans ranks 19th in size, but we are third in public corruption convictions. 

And the unintended consequence of public corruption is not only are they stealing from the people, but they are contributing to this violent crime landscape, in that companies from out of state will not invest in New Orleans, because they are sick and tired of the bribe and the kickback. 

MATTHEWS:  Yes. 

BERNAZZANI:  And the intended consequence of this is two-fold.  One, the city of New Orleans is denied tax windfalls that could provide programs for the youth to provide opportunity.  And, two, the youth have no jobs. 

And with this landscape, you get into this cycle. 

MATTHEWS:  Right. 

BERNAZZANI:  And when you have the relative collapse of the educational system and the problems with the perception of the state judicial system, we have the violent crime problem we have today. 

MATTHEWS:  Yes.  Well, maybe some day, those people will learn that graft isn‘t colorful. 

Anyway, thank you very much, Jim Bernazzani. 

BERNAZZANI:  My pleasure, Chris. 

MATTHEWS:  Up next, the latest on—from the ground in New Orleans. 

Plus, how soon can businesses in New Orleans get up and running? 

You‘re watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

(NEWS BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

New Orleans Mayor Ray Nagin suspended plans today to allow residents to reenter the city.  It was late today he made the announcement. 

MSNBC‘s Michelle Hofland joins us now with the latest—Michelle.

MICHELLE HOFLAND, NBC CORRESPONDENT:  Good evening, Chris. 

That is right.  He may have done that.  But I will tell you what.  Looking on the roads around here, the folks still heading in to the city, heading in with trucks and tractors and flatbed trucks to get those things out of here, those people obviously don‘t know it.  We saw some checkpoints, long lines of people trying to get into the city to get what they can out of their homes, their important documents and things like that.

I just left a few minutes ago St. Bernard Parish, where the sheriff there is—is, frankly, beside himself.  He has all sorts of people, he said about 1,200 people inside his parish right now, including homeowners who are just beside themselves looking at what is left of their homes and very upset right now, and then also a number of contractors and all sorts of other people in there.

And he says he is going to order them out of the county tomorrow because of the hurricane that is headed towards this—the Gulf.  He fears for their safety.  So, he is going to order them out of the county tomorrow.  He is very concerned about that, as well as a number of other people in this area.  And, frankly, rain is the last thing that the people down here need.  There are so many roofs that are still not closed and all of the mud and contamination. 

He is very concerned about this upcoming storm and all the people who have been allowed back into the county—Chris.

MATTHEWS:  Well, clarify this for New Orleans.  Are the New Orleans people going to be sent back packing because of the oncoming hurricane or what?  Are they going to stay there? 

HOFLAND:  Well, there is a, what is it—the dusk-to-dawn curfew. 

So, they had to get out of here by nighttime anyway. 

And, you know, there is still no freshwater to drink here, no electricity or anything else in much of the area.  So, those people were supposed to leave anyway.  In a lot of these areas, like St. Bernard Parish, there isn‘t any place for any of these people to stay.  So, they were supposed to leave at nighttime, and I guess they will just not be allowed back in tomorrow.

But the concern is for some people who are trying to find someplace to stay down here, and they want to make sure that they get those people out of here before this other storm arrives. 

MATTHEWS:  Do you understand the mayor‘s position now?  Is it that, because of the likelihood or possibility of being hit by another bad weather situation, in this case Tropical Storm Rita, that the people of New Orleans are not supposed to come back, in fact are not allowed to come back in the city?  Is that the position of the city now? 

HOFLAND:  Well, that is what I understand. 

That is—I actually didn‘t hear the press conference, because I was

I had to get a ride from somebody that was in St. Bernard‘s Parish, an environmental consultant.  So, I was racing back here to get onto your show. 

(CROSSTALK)

HOFLAND:  And we didn‘t have any radio contact.

(CROSSTALK)

MATTHEWS:  OK.  I think that is the situation right now, because we just watched the mayor‘s press conference. 

HOFLAND:  Right.  Right. 

MATTHEWS:  Hey, I am one of your biggest fans, Michelle.  You are one street reporter.  And, sometimes, you have to swim.  You are the best. 

HOFLAND:  Well, thank you. 

MATTHEWS:  Thank you. 

Thank you very much, NBC‘s Michelle Hofland in New Orleans. 

Michael Olivier is the secretary of economic development of Louisiana.  And he has been working on helping New Orleans and other areas get back to business.  And Doug Brinkley is a regular on this program.  He‘s a special historian, a longtime resident of New Orleans. 

Let me go to Mr. Secretary, Mr. Olivier. 

What does it take, if you had to do it in sequence—we did it with Broussard, Aaron Broussard, the president of the parish up there next door.  What does it take to put a city back together?  In what order do you need to put a city back together? 

MICHAEL OLIVIER, LOUISIANA SECRETARY OF ECONOMIC DEVELOPMENT:  Well, the first we have to do, obviously, is secure the city and dewater the city.  And that is the main thing. 

And I want to remind the viewers that we are not only talking about the city of New Orleans.  We are talking about a 10-parish area.  We are talking about 960,000 square miles of the area that‘s been impacted, in addition to the Mississippi coast and the Alabama coast that has been impacted. 

We have got a lot to do in terms of getting ready, not only security, but getting all of our utilities back in play.  And that is coming online pretty fast.  Our port—our deep water port is back in action.  We are making some great strides, as we try to attempt to bring some normalcy back to that region. 

MATTHEWS:  Is the mayor striding too fast in pushing to get the city reopened? 

OLIVIER:  Frankly, we were glad to see the mayor reopen the city, because we had a number of business—and that was the first case, was letting the businesses, allowing businesses access, so they could get their records, so they could make their SPA loans, so they could get to their insurance adjusters, because they have got to get back in business. 

If they are delayed any longer, they won‘t be back in business and we will have a lot of insolvent businesses from that region that we just can‘t stand.  We can‘t take that as a negative economic impact. 

MATTHEWS:  Is there a fear on the part of the mayor and other people in local politics down there in business that, if you let the residents stay away too long, they will never come back? 

OLIVIER:  No.  The New Orleanians and the people in the river region are going to come back.  We are convinced about that. 

We are going to have to certainly give them some incentives and some good reasons to come back.  And we are doing that.  Our Governor Blanco is really working with our congressional delegation.  We are working with the congressional delegations and the mayors of the other two states.  We feel very positive about being able to produce a package of incentives that‘s going to be good for the individuals and good for businesses, as well as attracting new capital investment to the river region. 

MATTHEWS:  Explain, if you can, Mr. Secretary, the sequence of the last day, the events.  What, from your backroom—back-of-the-room perspective, went on that got the president, the FEMA director, the—rather, the Admiral Allen, who is acting on this scene as FEMA director, to agree that it was time not to let the people come back into town, even though the mayor was pushing for it?  How did this work out behind the scene? 

OLIVIER:  I don‘t know the detail about behind the scenes. 

I can tell you that we—today, the governor participated in a media event, where the Procter & Gamble operations, the Folgers plants, which are coffee plants, were—a couple of them were put back into operation today. 

They have four of them in the New Orleans river region.  I think that is indicative of how we feel that we have to get back into a sense of business and bring people back to the city.  I understand that, you know, at first, there was a concern for health issues.  That concern has diminished.  What we are hopeful of that we are going to get back into operations soon, save it for this storm that is coming, this new storm that is coming, Hurricane Rita. 

MATTHEWS:  Yes.   

Thank you.  Hold on there.  Thank you very much, Mr. Secretary, Michael Olivier, who is secretary of economic development for the state of Louisiana.

Let me go to Doug Brinkley. 

Doug, you are a resident of New Orleans.  What do you fear about going home, back to the city?  What is—is it—is it the levees?  Is it the crime?  Is it the water quality? 

DOUGLAS BRINKLEY, NBC ANALYST:  Chris, I was there a weekend. 

And let me make something very clear.  Do not go back to New Orleans right now.  If you are talking about economic reasons, yes, it might make sense.  But when you‘re talking about people and lives, the answer is no.  There is no—the sewage is everywhere on the streets.  There is no electricity.  There is no running water right now. 

You would be delinquent, if you were a parent, like I am, with two kids to say, come on, let‘s go back to New Orleans right now.  Mayor Nagin is dazed.  He‘s confused.  He is tired.  He is making a lot of bad judgment calls right now.  And I am very glad to hear, at the end of the day, he had a conference and decided to tell people, stay out. 

We all want to get back home, but give it another week.  It is not ready to inhabited yet.

MATTHEWS:  I always assume rationality on the part of politicians who managed to get elected.  And Nagin to me, I have a sharper image of him, perhaps, maybe more of a romantic notion.  I think he is better than you just suggested. 

But what is his political purpose in wanting the people to come back so fast? 

BRINKLEY:  Well, he obviously wants what he thinks is best for the city. 

And you just heard the economic scenario.  It is true that some of the people that saved New Orleans are people that are there right now.  There are incredible stories of Royal Sonesta Hotel open and feeding people and trying to get the Slim Goodie diner open to give food and get New Orleans going again.  We all want that. 

But what we saw is that there is a lot of death and a lot of despair and that the public health concerns are real.  My house, for example, is not in too bad a shape.  But, when I went there, it‘s just electrical wires dangling all over the city, like spider legs.  There is a smell of gas leaks everywhere. 

MATTHEWS:  Right. 

BRINKLEY:  And these things just need to be checked out for a few more days.

MATTHEWS:  OK. 

BRINKLEY:  With the hurricane coming, let‘s give it a break and revisit it next week. 

MATTHEWS:  Thank you very much, Doug Brinkley.  He‘s a professor at Tulane University.

And thank you, Michael Olivier, again, sir, secretary of economic development for the state of New Orleans—state of Louisiana.

Coming up, what will it take to get the New Orleans tourism industry back on its feet? 

This is HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS:  Still ahead, some residents of New Orleans are returning home.  But is the levee system ready for another hit? 

HARDBALL returns after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

NAGIN:   I understand the federal government was a little excited about the plan.  They didn‘t feel as though conditions were quite right.  But my thought has always been that, if we have this many resources in the city working cooperatively, then we can correct just about any situation that was out there.  The only thing that I really needed to know was what was the EPA‘s assessment of the health risks associated with the city of New Orleans?

(END VIDEO CLIP)

MATTHEWS:  Welcome back to HARDBALL.  That was New Orleans Mayor Ray Nagin explaining his decision to suspend the reopening of the city. 

I am joined now by Stephen Perry, the president and CEO of the New Orleans Convention and Visitors Bureau, and by David Cohen of WWL Radio in New Orleans.

Let me go David first.

As you understand it, what are the marching orders for the people of New Orleans between now and Thursday, when Rita is expected to arrive? 

DAVE COHEN, WWL RADIO:  Don‘t come in.  If you were headed back to New Orleans or the metropolitan area, do not come in.  Turn around.  Go back where you were, and plan to stay there, while we wait to see what Rita does. 

And for those people who are emergency workers, the state announced today they are putting together a plan right now, how they will get the National Guard out, the other military out and all the emergency workers out, particular if Orleans, Plaquemines and St. Bernard parishes, because they are afraid, if they are there when Rita comes ashore, they could end up being casualties. 

MATTHEWS:  Do you think there is a fear that the levees will break? 

COHEN:  The Army Corps of Engineers has indicated that the levee system is not what it was before Rita—I mean, before Katrina.  And we saw that wasn‘t enough for Katrina. 

So, that tells you that, if it wasn‘t enough for Katrina and now it is in disrepair—they have made temporary fixes.  They are working on it, but the levee system is not what it was.  And what it was, was not enough.  So, I don‘t think the levee system can hold up.  If we get another monster hurricane and if we end up with the same kind of storm surge, we in real trouble. 

MATTHEWS:  Stephen Perry, do you agree on behalf of business down there that the mayor was right or he was wrong in pushing to reopen the city so quickly? 

STEPHEN PERRY, NEW ORLEANS CONVENTION AND VISITORS BUREAU:  Chris, I think the real answer lies somewhere in between. 

The critical factor right now is that business owners needed to get back into the city, as Secretary Olivier said.  You had business owners that had to recapture their servers, their financial records, their databases with customers, and even some to get into the warehouses to recapture products.

If we had blocked them out of the city, you would have made it—you would have decimated numbers of companies and you would have harmed individuals.  So, I think the real—the real hybrid answer to this is, people don‘t need to be coming and staying 24 hours a day, seven days a week.  But you have got to let the residents get back to assess the condition of their homes, to take pictures for insurance, to understand, for their personal planning, Chris, whether they need to have their kids in school for the next six months in another district or whether it‘s going to be a longer period of time. 

So, I—I—I think the truth lay somewhere in between.  They were both a little bit right.  But I think the dynamic has changed with the storm now, because, with that, I think every prudent individual knows New Orleans is not the place to be. 

MATTHEWS:  Steve Perry, Stephen Perry, do you trust the levees?  We are looking at one right now being rebuilt, or it has been rebuilt.  Do you trust them in a Category 2 or a Category 1 even? 

PERRY:  Chris, Chris, the levee—Chris, the levees are proven right now to have been temporarily repaired.  And they are not ready to take higher-level storm damage and wind pressure. 

(CROSSTALK)

PERRY:  So, I think it is very important that we keep the city clear, but that, immediately thereafter, not necessarily going back to live as if nothing is wrong and nothing has changed.  But I think it is critical that business owners and the occupants of the areas of New Orleans that were the least damaged, the French Quarter, the warehouse and arts district, the warehouse district...

MATTHEWS:  OK. 

PERRY:  ... the Garden District, that they get back to assess their homes, because they are going to have to do some planning in their lives. 

(CROSSTALK)

PERRY:  But I think they‘re too prudent to stay all night.

MATTHEWS:  I got you.  Come back and visit, get your books, and head out.

Thank you very much, Stephen Perry of the hotel—of the industry of tourism down there.

And thank you very much, as always, WWL‘s David Cohen. 

And up next, how safe is New Orleans from more floodings?  We are talking about it.  We are going to keep talking about it with the commander of the Louisiana Army Corps of Engineers. 

You‘re watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

So, where does the rebuilding of the levee system stand and can it withstand Hurricane Rita?  Colonel Richard Wagenaar is the commander of the New Orleans District Army Corp of Initials. 

Colonel Wagenaar, thank you for joining us. 

A big question.  If Katrina strikes again next week, the same type of hurricane, would it break through the levees? 

COL. RICHARD WAGENAAR, NEW ORLEANS CORPS OF ENGINEERS:  Boy, right now, we have minimal protection with the levee systems that are left after Katrina.

So, with Rita coming, we have got some intermediate actions we are going to take near term.  Right now, the protection levels are pretty low. 

MATTHEWS:  So, if we got hit by a Category 3 or a 2 or a 1 even, we‘d be in trouble? 

WAGENAAR:  I can‘t say for a 1.  And it really depends on the dynamics of the storm, but most likely we would have problems with any hurricane that would come into the system, either through storm surge or from significant amounts of rainfall. 

MATTHEWS:  So, we‘re less prepared now in terms of just dealing with the immediate challenge, if it comes as bad as Katrina, than we were before Katrina? 

WAGENAAR:  I would agree. 

MATTHEWS:  OK, let me ask you about the long term and the short term. 

In the long term, do you think we might see a real state-of-the-art flood control system down there, like they have in Holland and places like that, where it‘s really a work of human genius? 

WAGENAAR:  I believe we are.  Some of the engineers and the teams right now that are looking at New Orleans‘ future I think are looking at very long-term Category 5 protections, state-of-the-art type systems. 

MATTHEWS:  Is that a lot of money? 

WAGENAAR:  It will be a lot of money.  Yes, it will. 

MATTHEWS:  Ten billion? 

WAGENAAR:  Hard to estimate.  I think we will just have to see where the estimate comes out and let it go from there. 

MATTHEWS:  We‘re looking right now on the screen.  It‘s a very appropriate screen.  We‘re looking at piles of what look like cement bags.  They were dumped to up seal up one of the levees, the big breach in the levee.  How sound are they? 

WAGENAAR:  Generally, they‘re sound for what they‘re doing now and that‘s just passing water through the canal systems.  Our plan right now is, if Rita comes in and gives us problems, we will seal off the ends of the two canals we had problems with.  And that will prevent any water from coming from the lake into those canals. 

MATTHEWS:  What is the most vulnerable, the levee system, which are giant mounds of dirt and gravel, or the flood walls themselves that protect the canals?  What is more vulnerable right now? 

WAGENAAR:  Right now, I think the one London Avenue Canal, we believe, is the most vulnerable from a structural integrity perspective. 

MATTHEWS:  That‘s the one that just blew open, right, because of the force of the water?  One of them was—almost like a broadside of pressure from the water, right? 

WAGENAAR:  Right.  And it had two holes in it, one in each side, the east and the west sides. 

MATTHEWS:  Do you know what it would have cost—this is a speculative question, but would we have had the damage to New Orleans, what you see right now, which could be months or perhaps years long, if we had a better system?  And that may not be just a definitional question, but was it feasible to have a better system that would have worked? 

WAGENAAR:  Well, it‘s hard to say, because this was a Category 3 system that we had built and put in place.  And so all the funding—you know, the hypotheticals are out there, but all the funding is balanced against everything else that‘s going on across the country.  So...

MATTHEWS:  Sure. 

WAGENAAR:  I mean, I guess it would be feasible—would have been

feasible to build a Category 5 system.  But, at the end of the day, was the

were—was the American people—were the American people willing to truly pay for a Category 5 system prior to this storm?  That‘s hard to say. 

MATTHEWS:  Were the locals pushing for a Category 5 protection? 

WAGENAAR:  Well, I think they were.  I think everybody realized that the city needed better protection.  But they were also balancing that against other priorities in the area, to include coastal restoration. 

MATTHEWS:  Yes. 

So, let me ask you now.  I know you‘re a military guy and not a political guy.  But based upon what you‘ve experienced, is it logical to project the fact that the new reality is here and that what was not a priority, building a Category 5 protection system, a levee system and a flood wall system, that now there is that political will? 

WAGENAAR:  I think that there is right now. 

I just hope—you know, America forgets very quickly.  I just hope that the political will stay with this and we can look at a valid system for this region. 

MATTHEWS:  Would you open that up?  If you were making the call, sir, Colonel, would you be opening up the bid? 

Like, you know, we have watched the World Trade Center, the jockeying that is still going on there to pick a suitable structure and a suitable engineering firm to design it, to replace the World Trade Center, which was lost on September 11.  Do you believe that there will be an international bidding to try to create the best state-of-the-art system?  Or will it be more of the old cronyism and maybe graft that we have seen in the past? 

WAGENAAR:  Well, I think, interim wise, we‘re going with multiple contractors and work with the locals to make sure they get benefits from that. 

Large—long term, we will see what the acquisition strategy is.  But I think, you know, probably, we will go with a global type of contract and see who wins that.  It could be a large U.S. contractor working with many local firms.  It all depends. 

MATTHEWS:  Let me ask you a tough question.  Did the flood walls break along the London Canal because of inferior materials that were below spec? 

WAGENAAR:  I don‘t know. 

I—we right now are trying to—we‘re going to start planning and pulling out the material, the flood walls themselves, to look at them for an investigation to determine what happened.  We don‘t know what happened.  My—my people want to know as bad as everyone else, because they‘re locals.  They designed—and they were built here.  And so they want to know what happened to these walls just as bad as everyone else. 

MATTHEWS:  What institution was responsible for verifying the specifications, verifying the quality of the work and the materials used in constructing those flood walls that gave way? 

WAGENAAR:  It depends on which flood walls.

MATTHEWS:  London.  The London Canal. 

(CROSSTALK)

WAGENAAR:  ... between the Corps or an A.E. firm or the local levee district.  It really depends on which specific one you‘re talking about. 

MATTHEWS:  Do you think someone will be held to account if there was foul play here or there was graft, inferior materials used? 

WAGENAAR:  That‘s hard to say, Chris.  I really don‘t know.

MATTHEWS:  OK.  I know it was a tough question, perhaps an unfair one, but it‘s—I‘m curious about it. 

Hey, sir, thank you very much.  It‘s an honor to have you on.  Thank you, Colonel Richard Wagenaar, commander of the Army Corps of Engineers in New Orleans.

WAGENAAR:  Thank you. 

MATTHEWS:  Join us tomorrow night at 5:00 and 7:00 Eastern for more

HARDBALL. 

Right now, it‘s time for “THE ABRAMS REPORT” with Dan. 

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