US: Underlining the difficulties facing this devastated city, Mayor C Ray Nagin has announced with "great sadness" that New Orleans would have to lay off half its municipal workforce due to the financial fallout from hurricanes Katrina and Rita.
Mr Nagin said that cutting some 3,000 jobs would save up to $8 million of the city's $20 million monthly payroll. No police officers, firefighters or emergency medical technicians would lose their jobs, but "non-essential" support workers in those departments would be dismissed.
With few residents having returned to the city and only a handful of businesses functioning, New Orleans has virtually no tax money coming in to pay employees. The city has received $202 million from the US Federal Emergency Agency, but federal law allows that money to go only to overtime.
Mr Nagin said he had secured a verbal promise of $50 million from a bank; that credit would enable a slimmed-down city to survive about two more months - and hopefully avoid bankruptcy.
City workers expressed dismay and disappointment that the federal government had not found a way to keep New Orleans running. "If you're not able to keep the city operating, businesses and people might not come back at all," said David Benelli, president of the Police Association. - (LA Times-Washington Post Service)