Scores of tiny silver hand bells tinkled, as the city's prominent Mayor Ray Nagin led a poignant memorial service to the 1,500 dead across the Gulf Coast and remembered the devastation which laid waste whole communities.

Two years on, much of the city famed for its jazz and Creole cooking still lies abandoned after surging seas whipped up by the hurricane breached its levees on August 29, 2005.

Bush, who was sharply criticized for failing to respond swiftly to the enormous tragedy unfolding before the nation's eyes, on Wednesday paid his 15th visit to the city since the storm hit on August 29, 2005.

"New Orleans, better days are ahead," he said during a visit to a school which was submerged under 15 to 18 feet of water.

"When Hurricane Katrina broke through the levees, it broke a lot of hearts, it destroyed buildings, but it didn't affect the spirit of a lot of citizens in this community."

But in the separate ceremony led by Nagin, who has become a prominent US figure with his tireless campaign to rebuild the city, tears flowed amid the bitter memories of the storm which tore apart the Big Easy.

"Give us what we need to move forward or we'll figure it out ourselves," Nagin, who had dined with Bush late Tuesday at a popular Creole restaurant set to reopen after being rebuilt.

At precisely 9:38 a.m., the moment when authorities say the first levees crumbled in face of the storm, Nagin and the gathered mourners rang silver bells in remembrance of the dead.

Lone trumpeter, Irvin Mayfield, played a soulful rendition of a funeral dirge, "A Closer Walk With Thee."

While parts of the city, such as the famous French Quarter, have managed to come back to life thanks to their higher elevation, much has been left to rot, a silent testament to the inefficiency of the US emergency services.

Some 80 percent of the city was left inhabitable when Katrina struck and two years on some 42,250 families in Louisiana are still living in cramped government-supplied trailers.

Billions of dollars in federal aid remain wrapped up in bureaucratic red tape and blame is flying in all directions.

Later Wednesday, the city was to unveil the Katrina Memorial in a nearby park. Some 1,500 people were killed across the Gulf Coast, some 1,100 of them in New Orleans.

About 100 of the storm's unidentified and unclaimed victims are to be laid to rest at the new mausoleum set to be built at a later date.

The president and First Lady Laura Bush traveled later to Mississippi to be briefed on rebuilding there and make a statement before heading back to Washington.

In Ninth Ward, a traditionally black neighborhood which has seen little rebuilding, demonstrators planned to march to Congo Square, which the city designated in 1817 for slave assemblies, dancing and voodoo rituals.

Activist Brad Ott said he planned to join the march to highlight the dismal health care in the city, post-Katrina.

"We have the worst mental health care crisis in the country and arguably the worst mental health care crisis in 100 years," Ott said.

Life remains hard here.

The musicians, artists and everyday residents who made the jazz mecca unlike any other place in the country are battling with exorbitant rents, rising costs of utilities, high insurance, spiking property taxes and crime.

Homeowners are still struggling to find reliable contractors and weave through the bureaucracy of the government and insurance companies so they can pay them.

And workers in the remote, heavily damaged residential areas of eastern New Orleans find little safety in numbers -- gunmen rob job sites en masse in broad daylight.

The stress is taking a huge mental toll: a recent government study found that mental illness has doubled among Gulf Coast residents, there is a surge in the number of people considering suicide and there are more people suffering from post-traumatic stress now than there were a year ago.

And the city is on pace to become the nation's homicide capital with 140 murders so far this year in a depopulated city of only 275,000 people.

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