The people who live on the banks of Lake Managua are among the poorest in the Americas – many eke out a living as garbage-pickers or street vendors, living on less than a dollar a day.

When Hurricane Mitch hit Nicaragua in 1998, the lake rose 10 feet, forcing thousands from their ramshackle homes. The government moved 12,000 people to two fields in Ciudad Sandino in the hills above Managua, giving them each a plot of land 10 yards by 15 yards and a black plastic tarp to serve as a new home.

The survivors called their community “Nueva Vida” – new life.

Amid the squalor of the camp, a group of women came together determined to find a way to support their families. With the help of U.S. activists from the Center for Development in Central America, who had been doing work in Nicaragua for years, they organized a sewing cooperative, and managed to secure loans to build a factory and buy sewing machines and land a contract with Maggie’s Organics, a Michigan-based company that makes organic cotton clothing.

Today the cooperative employs the heads of 47 households, and pays them 40 percent more than they would earn at most other Nicaraguan factories In a country and an industry where most workers are forced to work long days and nights under harsh conditions, the members of the cooperative work eight hour shifts, are free to leave their work stations whenever they need to, and make their own rules collectively.

Eradicating poverty in Nueva Vida remains a distant dream – but the sewing cooperative is a powerful example of what people who have lost everything can achieve if they are given the resources and support they need and empowered to make decisions about how to rebuild their own lives. The community’s success was achieved through the courage, vision, and hard work of the women who started the cooperative, the willingness of donors and creditors to trust the women to chart their own course,

Like the women of Nueva Vida, many of the survivors of Hurricane Katrina come from tightly knit communities where people have a proud history of struggling together in the face of poverty, bigotry and neglect. In the poorest neighborhoods of New Orleans many risked their own lives and delayed their own escape in order to help the young, the old, the sick, and the stranded.

The example of Nueva Vida points the way to how we can begin rebuild the Gulf Coast without reinforcing the structures of inequality. The market alone can’t be trusted to bring the right kind of jobs back to the region.

Incentives for development and reconstruction need to be linked to fair working conditions and fair pay. People from poor communities need to have a voice in determining where and how resources will be invested.

Consumers have a role too, using their money to support Gulf Coast companies that are committed to paying workers a living wage, like Kenneth Gordon, a unionized garment factory in New Orleans that is keeping all of its workers on the payroll while the company rebuilds.

Hurricane Katrina revealed some hard truths about poverty and inequality in the United States. Let’s use the reconstruction effort as an opportunity to change those realities by building a fair economy.

Sean Donahue is director of PICA (Peace through Interamerican Community Action). He visited the Nueva Vida Cooperative while leading a delegation of U.S. activists investigating economic realities in Nicaragua last June. He can be reached at sean@pica.ws.