Stratfor Public Policy Intelligence Report
September 14, 2005


By Bart Mongoven

One of the many terms that Hurricane Katrina has made popular in the
American lexicon is the phrase "toxic gumbo" -- referring to the mix
of sewage, industrial chemicals and other pollutants that presumably
were swirling in the waters engulfing New Orleans after the levees
broke on Lake Pontchartrain. The question in the wake of the hurricane
was not whether the rising waters were dirty, but just how dirty.

Testing thus far shows that the waters are indeed full of raw sewage
and microorganisms that spread infection and disease. There is a film
on the surface of the water, consisting of oil and gasoline that is
leaking from cars, boats, trucks and anything else that uses an
internal combustion engine, and household chemicals have been released
into the waters as well. But as yet, there is no evidence that the
centerpiece of the "toxic gumbo" fear -- major toxic leakage from the
dozens of industrial facilities that line the Mississippi River from
the Gulf coast to Baton Rouge -- has materialized.

Just as Katrina will be a major factor in discussions on energy policy
and disaster preparedness, it likely will play a major role in shaping
crucial realms of environmental regulation as well. It was clear even
before the flood that Katrina would have an impact on the debates over
environmental management and regulations. But if it is proven that
there were no major industrial accidents following the hurricane, the
debates that emerge in the coming months will not be those that were
anticipated at the beginning of the crisis -- in other words, the
debates will not be about the impact of industrial accidents. Instead,
in the short term, the chemical and refining industries actually might
come out looking pretty good in the aftermath of Katrina. Over the
longer term, however, the sediment the floodwaters leave throughout
Louisiana might bring new questions about chemicals to the public's

That major facilities remain intact, and appear not to have dumped
tons of toxics into the environment, shows that industry has
established environmental management systems (EMS) that work even
under extreme conditions. EMS -- which can be thought of essentially
as applying widely accepted business principles to environmental
protection issues -- is used by most major industrial facilities to,
at the very least, ensure compliance with environmental regulations.
EMS includes such processes as identifying crucial environmental
issues; establishing corporate policies and objectives; determining
how to achieve these objectives; implementing strategies; and
periodically reviewing both performance and the process itself. These
management systems guide day-to-day operations and also govern how
facilities prepare for disasters and respond to emergencies.

So far, it appears there have been no massive environmental management
failures by industrial facilities in the hurricane zone. If this
holds, the implications for future debates and discussions of
chemicals will be numerous.

First and foremost, it should give communities near industrial
facilities some confidence that the nearby plants are well-managed.
Community relations is an increasingly important issue for major
facilities -- particularly in the Gulf Coast region, where some living
near industrial plants harbor significant distrust of state and local
regulators. In this region, a number of local organizations have been
actively demanding that facilities adhere to higher standards for
environmental performance and compliance than they currently do. These
local citizen groups, skeptical of both corporate and official
reassurances that industrial emissions are not hazardous, have taken
to testing the local air and water themselves. They keep tabs on
"upsets" such as flaring and other irregularities, and they report
their findings to lawyers and to government at all levels. The solid
performance by industry during and after Katrina is not likely to
stifle these demands for more stringent EMS standards, but the
apparent lack of catastrophic problems should provide some context for
communities trying to judge just how safe the local facility really

Further, the absence of major industrial incidents in Louisiana will
raise the level of attention that industry and government give to
environmental management standards. It is particularly difficult for
government to regulate disaster preparedness among industrial
facilities, but Katrina shows that it can be done effectively with
EMS. The government does not have the resources to tailor its
management systems on a facility-by-facility basis, and it likely
would be inefficient and ineffective for government to implement a
command-and-control management system that anticipates Katrina-like
situations. But the government can, and to some extent does already,
encourage industry to adopt EMS systems. The lack of Katrina-related
industrial pollution will increase the level of consideration given to
the most influential EMS standards, particularly ISO-14001, and EMS
may emerge with an increased role codified in environmental

If the current assessment holds, then, what we likely will find in the
near future is that fears of "toxic gumbo" were overwrought: The bulk
of the water pollution problem does not stem from toxic chemicals
found at dangerous, poorly managed facilities, but from organic waste
that will decompose over the coming weeks and eventually dissipate.
Over time, however, will come the realization that, given the absence
of industrial leaks, the relatively small amounts of toxic chemicals
that were in the water are the stuff of daily modern life, not exotic
substances used in obscure industrial processes. Chlorinated
pesticides, brominated flame retardants used in furniture and
electronics, mercury in cars and all the rest that is being deposited
in the soil are not industrial leaks, but merely the chemicals that
surround us at all times.

We do not expect these chemicals will be found in such dangerous
amounts that there will be calls to turn swathes of the flood-stricken
region into Superfund sites. But the soil, when eventually drained of
floodwater, will contain the chemicals that most of us keep under the
kitchen sink -- and this could strengthen calls to examine the
chemicals used in daily commerce.

The public discussions resulting from what we learn about the toxicity
of the New Orleans floodwaters will have two main thrusts -- one
specific to Louisiana, the other more national and social in scope.

First, there will be questions about how to rebuild Louisiana
communities in a way that minimizes the chances of another flooding
disaster, but also in a way that minimizes the ancillary problems --
such as the toxic releases. Despite the apparent lack of significant
industrial breaches, any neighborhoods that have been rendered
uninhabitable and that are near industrial facilities likely would be
rebuilt farther away from those facilities. Many communities -- most
famously Norco, Louisiana -- have petitioned in recent years to have
entire neighborhoods moved away from refineries and other plants. If
similarly situated neighborhoods are to be rebuilt, they likely will
be moved.

Second, many activists will use the presence of toxics in the water
and soil to argue for as much environmentally safe design and
technology as possible in reconstruction efforts. Remembering the
fears of "toxic gumbo," those debating the minutiae of rebuilding of
Louisiana communities will search for ways to limit the use of
environmentally harmful materials or building methods use as few toxic
materials as possible. The so-called "green building" movement --
which predates Katrina by a decade -- likely will benefit from this
push in the coming months, as unprecedented levels of new construction
are commissioned, amid a policy atmosphere still suffused with fears
of toxins in the environment.

More broadly, as researchers determine what chemicals are being
deposited in the soil across Louisiana, the public will be presented
with a unique glimpse of just how many chemicals are involved in our
daily lives. Environmentalists can be expected to emphasize that the
data from soil samples indicates an unhealthy reliance on chemicals in
everyday products. There already are a number of groups and coalitions
calling for electronics, cars, building materials, cosmetics and other
consumer products to be reformulated, to use the smallest possible
amounts of hazardous chemicals. These groups' arguments will surface
as soil samples show what has been deposited in Louisiana, but the
groups will not use this information to argue that the region's
industrial facilities must be shut down. Instead, they will point to
the soil and argue that the products in people's homes should not
contain so many toxic chemicals that, released from the bottles,
batteries and fabrics that normally contain them, they could render
the land "contaminated."

Environmental activists have used national disasters as a platform for
their messages before -- such as in the aftermath of the World Trade
Center destruction, which coated much of New York City in toxic dust.
However, calls for the reduction of toxics in buildings and consumer
products in the wake of the Sept. 11 attacks were ill-timed -- they
came far too soon after the event -- and were poorly justified; thus,
they did not result in policy change. Katrina, however, was a natural
disaster that has elicited very different emotions among populace:
Americans are much more questioning of their government and themselves
in the wake of this event than they were after the Sept. 11 strikes,
and, as a result, national politics are shifting.

For the environmental movement, the outstanding question now is
whether the public will come to view the chemicals in Louisiana's soil
as an acceptable cost of modern life or as an indicator that the
country has been short-sighted in its choices.

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