On the meaning of Katrina.

WE HAVE WITNESSED a terrible human tragedy on the Gulf Coast and in New Orleans as a result of Hurricane Katrina. While expressing our sympathy, it is also time to contemplate the morals of the story for chief executives and public policymakers alike.

* After the terrorist attacks of Sept. 11, 2001, we heard a great deal about how CEOs were going to make their companies more resilient in the face of potential disaster. We heard more of the same after the failure of the electricity power grid in the Northeast.

But Katrina has revealed how little progress has really been made. The energy industry's supply chains were completely disrupted, sending a cascading effect on gasoline prices through much of the United States. Telecommunications and transportation were once again knocked out. No company can ever be fully insulated from disaster, but in an era of increasingly globalized supply chains and outsourced information technology programs, Katrina sends a signal that more needs to be done on disaster preparedness and risk mitigation.

* We all have watched in recent decades how the quality of government in this country has deteriorated. The least intelligent, least entrepreneurial and least motivated people seem to go into government. One result: Government has gradually become a backwater. Few CEOs thought there would be a price for that. But now we see that in the case of Katrina, municipal, state and federal government agencies all failed to anticipate and coordinate. Government didn't work. The lesson: Bad government costs everybody.

* A national energy strategy should be a major priority. How was it that we as a nation allowed a single storm to knock out about 10 percent of our gasoline refining infrastructure? It seems there's been almost no discussion about the security and resiliency of that system.

And isn't it a mistake to be so dependent on imported crude? What happens if there's a meltdown in Venezuela or Nigeria or Saudi Arabia? It seems obvious that we should have more diversified sources of energy, including domestic ones. That might mean it may be time to open up the Alaskan reserves. And alternatives ranging from solar and wind to nuclear power ought to be promoted more robustly.

* Our economic growth patterns may be part of our vulnerability. The development of a casino industry near Biloxi and the location of summer homes and retirement facilities in a hurricane zone seem mildly insane in retrospect. Building has occurred throughout the South on shorelines that often get hit by storms. Land use policies allow it, and the insurance industry is writing policies to cover those buildings. That makes business sense in periods of quiet weather. But is it smart over the long term? It doesn't appear to be.

If there was one overarching impression from watching the disaster unfold on television, it was this: "Is this happening in America?" How suddenly a major metropolitan area was plunged into Third World chaos! Television viewers around the world saw desperate images in the streets of a major American city.

The lesson for both private sector and government leaders is that it is time to work together in the right sort of ways to create smart long-term policies for everyone's benefit. One way to display that kind of leadership would be to build a better New Orleans and surrounding areas as quickly and wisely as possible. We are aware of the argument that it doesn't make economic sense to locate a city beneath sea level. But Holland is an entire nation protected by dykes. With proper planning and maintenance, it obviously can be done. Perhaps some particularly exposed coastal areas should not be rebuilt. But failing to rebuild New Orleans would send a hugely negative message to the world that American leadership no longer works.