Jackson called it "corrupt" that storm survivors were left jobless and about half the city staff was being laid off in the aftermath of hurricanes Katrina and Rita, while contracts to rebuild the region go primarily to out-of-state corporations.

"There is no job being done right now by Halliburton and Bechtel that can't be done by people who live here," Jackson said, making reference to a pair of major corporations, one with ties to US Vice President Dick Cheney.

Responding to the crisis by suspending minimum wage laws, environmental regulations, and race considerations in employment and subcontracting is tantamount to declaring "marshal law on civil rights," Jackson said on a roadside in the hard-hit Ninth Ward.

Jackson condemned a decision announced earlier in the day by New Orleans Mayor Ray Nagin to lay off about half of the city's employees because there wasn't money to continue paying them.

Storm-savaged cities in the region have had their tax bases stripped away, and federal rules bar federal funds from being used for routine worker wages. The state governor has asked President George Bush to suspend that rule in Louisiana.

"If the mayor says he doesn't have the money, then where is the money?" Jackson asked. "Maintaining the local workforce should be a priority."

"All displaced citizens should have a right to return home to jobs, job contracts, and training."

Jackson said he was delivering to FEMA, the Red Cross and local officials copies of a petition bearing the signatures of 100 storm "exiles" in Chicago asking for help returning to return to New Orleans.

Preventing people from returning to New Orleans threatens to alter the demographics of the city, which was predominately African-American before Katrina struck August 29, Jackson said.

Not rebuilding the poor, predominately African-American Lower Ninth Ward neighborhood that was nearly obliterated in the storms would amount to "racial profiling," Jackson said.

"It is more than just a black culture," Jackson said. "Everywhere that was hit by the hurricane, whether they are white or black or brown, those who have been displaced have a right to return home."

A levee protecting the neighborhood from nearby Lake Pontchartrain broke in two places, and a colossal barge rode in with the water and crushed homes. The neighborhood flooded anew during Hurricane Rita.

Engineers from the Army Corps of Engineers hoped to have the last of the flood water pumped from the neighborhood by Wednesday.

Jackson, a well-known public figure, has visited the hurricane zone repeatedly and has been a fierce critic of the government's response to the disaster since it began on August 29.

Jackson raised the sensitive issue of race, simmering below the surface in New Orleans, even before the hurricane tragedy, pointing out that many of those trapped in the city by the storm were poor and black.