A few years ago, the St. Petersburg Times sent reporters out to investigate grouper, the succulent, meaty fish drawn from the Gulf of Mexico. They bought the fish at restaurants around the Tampa Bay area and had it tested at a DNA laboratory. Most of it was something else.

Some of it was hake, some of it was pollock. Some, as the newspaper put it, was "Asian catfish masquerading as grouper." The contents of one meal were unidentifiable, even to the DNA technicians.

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The Foreclosures R Us bus, Fort Myers, Florida. (Alan Habbick/CBC)

The stories provoked an uproar and Florida state authorities were forced to step in. Inspectors did another round of tests and found that just about everybody was passing off cheap fish as the more expensive grouper. Eventually, fines were paid and the state stopped investigating.

Last year, an identical scam was uncovered further south, in Fort Myers. Still, just about every restaurant I visited along the Gulf Coast last week was cheerfully offering bargain grouper.

Fried, crusted in pecans, sautéed, baked. Whatever. It tasted all right and, anyway, the actual DNA of whatever is on the plate is the least of anybody's worries nowadays.

Swindled and beaten bloodier than most states by the economic crisis, Florida is lying awake at night like a terrified cardiac patient, praying the angina will pass. The confidence games here were ruinous. The housing fraud was industrial-scale. The economic shortsightedness bordered on lunacy. 

End of the dream

Lehigh Acres, a sprawling bundle of communities without any kind of municipal government, is the worst. You enter it along Gunnery Road, running east of Fort Myers, and pretty soon the dilapidation flows everywhere.

Particularly striking is the newness of it all. Some of these homes — pastel orange, blue or green — have never been occupied, yet the windows are smashed, the appliances have been ripped out and the yards are a tangle of garbage-strewn brambles.

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Foreclosed house in Fort Myers. (Alan Habbick/CBC)

Many of the residents now are renters, attracted from even tougher areas, living alongside despairing homeowners who thought they'd bought a piece of what some still insist on calling the American Dream.

Four years ago, Lehigh Acres homes were selling as fast as they were built and speculators and developers threw them up cheap and quickly. Back then, anybody who could fog a mirror could get a mortgage. Housing prices swelled every week.

Many of the mortgages were predatory, even fraudulent; buyers were encouraged to lie about their incomes, and many did.

By December 2005, when the housing market began to collapse, the median sales price of a home in the Fort Myers area was $322,000. Today it is $99,000.

In Lehigh Acres, it is more like $50,000. Marc Joseph will gladly sell you one.

Foreclosures are us

"The beauty of these prices is that people are here taking advantage of the glass being half full," says Joseph, with the relentless optimism of a realtor. "Some people lost. For other people, they gain."

Trim and energetic, Joseph is prospering. He runs Foreclosure Tours R Us, a company that does just what its name implies. His green bus, blaring the company's logo, hauls around groups of bargain-hunters responsible for the sudden upsurge in real estate sales.

In upscale neighbourhoods, people just glare at the bus and retreat inside their homes. On more distressed streets, he's just ignored.

"This is the time to pull the trigger," he tells his clients. "If the market has not reached bottom, it is very close to bottom. Things are turning around."

Perhaps. That remains to be seen. South Florida's recent sales surge is more likely due to the sudden willingness of federally-supported banks to accept half, or even a third, of what a property was once worth.

These same banks account for nearly two-thirds of the sellers here. In other words, the market is still deeply diseased, just shedding its more gangrenous flesh.

Up and left

Floridians, meanwhile, still have to live here, striving for normalcy as their society shrivels around them.

Cape Coral, more upscale than Lehigh Acres, lies on the other side of Fort Myers, surrounded by the clear water of the Gulf. It's the second biggest city in Florida by size, with more canals and water access than any city in America.

A vast, rambling place with no core and ghost towns on its edges.

I met a woman named Connie there, living in a bungalow. She allowed herself to be coaxed out into the flat March sunlight on the promise that her family name wouldn't be used. She's embarrassed by the state of her neighbourhood and probably embarrassed by her own impending eviction.

The house next door is empty. Foreclosed. The one two doors down is empty, never occupied.

The family across the street abandoned their home a year ago. Just packed up and left.

Connie thought they were going on vacation. They even left their car, a late-model white Dodge Intrepid. A notice on the driver's window threatens it will be towed, at the owner's expense, if it isn't moved in three days.

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South Florida University professor Gary Mormino, creator of the notion of The Ponzi State. (Alan Habbick/CBC)

"The city put that notice on nine months ago," says Connie. "I wish they'd tow it. I hate looking at it. I hate it."

She hates the overgrown yards, too. They're a fire hazard and they attract snakes.

The Ponzi state

Cape Coral can't afford to tow the car, though, or clear the brush from yards. The loss of taxes from foreclosed properties is strangling its municipal government. It's the same story all over the state.

Not that there was ever much government to strangle. Florida is light on government in general. Governments cost money and Floridians don't like paying taxes. There is no state income tax here.

Gary Mormino, a professor at the University of South Florida, has compared the economy here to a giant Ponzi scheme, the confidence game in which investors are paid with the money of new investors.

The Ponzi State. The phrase is catching on and it's making Mormino famous.

He says Florida's economic setup has always depended on ever more people, often retirees on fixed incomes, arriving from out of state with money to spend.

Since 1970, the state has grown by an average of 350,000 new residents a year — or a thousand a day.

To accommodate them, politicians in Tallahassee basically let developers build whatever they wanted just about anywhere they wanted. Usually, that has meant apartment towers and minimally inspected cinder-block homes on concrete slabs.

The construction barely paused and neither did the waves of tourists — as many as 80 million vacationers a year, all ready to pay hotel taxes and rental taxes and restaurant taxes and sales taxes.

Now, everything's flat. In fact, more residents might be leaving than arriving. And the tourists are staying away.

For Mormino, Florida is just a palm tree fantasy with a tax structure "that was insane." And now, he says, "we're paralyzed."

Unemployment is nightmarish and rising. Tax-hating Floridians, turning to their government for help, are finding a stunted, business-driven entity with nothing to offer.

"When people began looking behind the palm trees and into the account books," says Mormino, all they discovered was "massive fraud and lack of oversight."

The 'rocket docket'

The disposal pipe for this dismal mess is the Lee County Courthouse in downtown Fort Myers.

Here, judges brought back from retirement preside over something called a "rocket docket," expressly designed to push through thousands of foreclosures a month.

The homeowners who actually show up for this last hearing have no fight left. Many are working-class minorities who were talked into believing you can own a house on minimum wage. They seem to shrink when they stand to face the bench.

Judge Jack Schoonover is gentle with them. If there are kids in the house he'll usually allow 60 days. But they will have to leave.

Schoonover won't tolerate poor paperwork by bank lawyers. If they make a mistake, he kicks the case to the back of the line and tells the homeowner to go home for awhile longer. But a hardship plea goes nowhere with him. He tells one woman he can't find her a job. "The president has to do that for you."

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Storm clouds in Florida as the housing skid pushes it to the top of the foreclosure heap. (Alan Habbick/CBC)

By midday, he's dealt with 190 cases, creating more product for the bottom-feeding investors who come in and buy in bulk.

At the Anna Maria oyster bar in Bradenton, waitress Carolyn Walker is keeping up a stream of cheery patter for the tables of retirees in plastic bibs. Lobster is on special tonight.

"I'm an optimist," she stresses, setting down my fried grouper.

But she does allow that tips are stingier these days. Her life is getting tough.

She has a 12-year-old daughter she hopes someday to send to college. Lately, though, she's been "literally living day to day."

In middle age, she's taken a second job cleaning people's homes and that helps. "My daddy," she says, "raised me to be happy."