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Mississippi flooding drowns crops and casinos: What's the economic toll?

The economic toll of the Mississippi River flooding has yet to be calculated, as the crest pushes past Memphis towards New Orleans, but is expected to run in the billions.

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Riverboat casinos will take a heavy hit, as will state tax revenues associated with it. Nineteen casinos in Mississippi will be closed for an expected six to eight weeks, says Sohini Chowdhury, an economist who tracks the Mississippi economy at Moody's Analytics in West Chester, Pa.

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That means some 13,000 people temporarily out of work, collecting unemployment benefits rather than paychecks. It also deprives the state of $14 million for each month that the casinos are shuttered, Dr. Chowdhury says. Louisiana and Tennessee also have casinos affected by the floods. Although the affected casinos are typically floating riverboats, which should survive the floods, surrounding businesses and infrastructure could be damaged.

Impact on businesses and homeowners

Businesses and homeowners in flood zones – notably Memphis, but also smaller communities along the river – are also feeling the impact.

River barge traffic – typically responsible for transporting billions of dollars of crops and merchandise each day – faces slowdowns, although these could be short-lived.

Some commodity experts warn of possible slowdowns in the region's oil refinery operations.

Repairing or rebuilding damaged homes and businesses could stretch into next year or even 2013, in parts of Memphis and other river communities.

In all, the flood damage known so far isn't big enough to change the economic forecast for the region, Chowdhury says. But it's still early.

"The flood is still moving southwards," she says. "Everything depends."

Floods will not crest in Louisiana before the weekend. Until they crest, questions remain: Will the levees hold? Will officials open the Merganza Spillway near Baton Rouge? That move would protect the city by putting nearby communities and farmland under water.

The floods also come as the government's flood insurance program is up for review in Congress. Some lawmakers, citing the program's recurring deficits, say the job of flood insurance should be handed over to states.

Farmers typically have crop insurance, so private insurance firms will bear much of the cost of agricultural losses.

As commodities traders try to gauge the effects of the floods and other recent weather on grain supplies, the US Department of Agriculture gave a forecast Wednesday that was more upbeat than expected. The USDA news helped corn and wheat prices fall in Wednesday futures trading.

IN PICTURES: Mississippi River floods

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