U.S. Marshal officers and Arizona emergency workers return to dry land after searching homes for survivors in the mid-city section of New Orleans on Sunday. AP Photo/Houston Chronicle, Mayra Beltran

NEW ORLEANS - Business owners in the central business district were issued passes into the city today to retrieve vital records or equipment needed to run their companies, as New Orleans slowly and painfully stirred back to life two weeks after being slammed by Katrina.

Traffic was heavy on the only major highway into the city that was still open, and vehicles were backed up for about two miles at a National Guard checkpoint in Westwego, a suburb across the Mississippi River.

There were also signs of life at businesses elsewhere in the city, after a weekend in which trash collection began and the airport reopened to cargo flights.

In the French Quarter, Nick Ditta was at Mango Mango, the bar he manages on Bourbon Street, searching for time cards.

"It's a mess, man. There is no doubt about it," Ditta said. "But our people are going to get paid. That's all I'm worried about."

President Bush got his first up-close look at the destruction in New Orleans today, taking a tour that took him through several flooded neighborhoods. Occasionally, he had to duck to avoid low-hanging electrical wires and branches.

The president denied there was any racial component to the way the government responded to the disaster, disputing assertions that Washington was sluggish because so many of the victims were poor and black.

"The storm didn't discriminate and neither will the recovery effort," Bush said. He also rejected suggestions that the nation's military was stretched too thinly with the war in Iraq to deal with the Gulf Coast devastation.

Military cargo airplanes were set to begin spraying the New Orleans area on Monday to kill flies and mosquitoes. The standing water from Katrina is expected to worsen Louisiana's already considerable mosquito problem.

Though 50 percent of New Orleans remained flooded and teams continued to collect the corpses, there were signs that the hopelessness was beginning to lift.

"Each day there's a little bit of an improvement," Coast Guard Vice Adm. Thad W. Allen, commander of the New Orleans relief efforts, told NBC on Sunday night. "And in the end run, maybe a week, two weeks from now, someone's going to wake in the morning and have something they didn't have the day before, and that's hope."

The waters in New Orleans, which once covered 80 percent of the city, have pulled back far enough to allow for a scenic drive down Esplanade Avenue.

The same can be said for Saint Charles Avenue. While many homes are deserted and the old street cars are gone, the beauty of the Greek Revival and Victorian homes, fronted by a canopy of live oaks, overwhelms the sight of debris piled along the road.

"I think it's livable," said John Lopez, who moved to New Orleans from the New York City area about a year ago. "If they got running water to all these buildings that are obviously inhabitable, they could get the city cleaned up a lot faster because people would be cleaning up their own blocks and their own neighborhoods."

Lopez and others are among those in the city who survived the hurricane at home, refused the subsequent order to leave and have started to clean up their neighborhoods.

Authorities raised Louisiana's death toll to 197 on Sunday. Teams pulled an unspecified number of bodies from Memorial Medical Center, a 317-bed hospital in uptown New Orleans that closed more than a week ago after being surrounded by floodwaters.

Elsewhere, there were nuggets of encouraging news:

n Louis Armstrong New Orleans International Airport reopened for cargo traffic Sunday and planned to open to limited passenger service starting Tuesday.

n The city's main wastewater treatment facility was expected to running by today, said Sgt. John Zeller, an engineer with the California National Guard.

And residents of New Orleans were trying to re-establish pieces of the city's inimitable character. Some even found things to laugh about.

Barbara Hoover, who lives in the Faubourg-Marigny neighborhood just downriver from the French Quarter, said the military's ready-to-eat meals are "just as good, if not better, than the South Beach Diet. They're amazing."

- AP writers Erin McClam, Mary Foster, Colleen Long, Warren Levinson and Howie Rumberg contributed to this report.