Will this disaster be the last straw?
Immediate thoughts:
1) Depending on how much of the nuclear industry was affected, this could result in the need for more imported oil, putting more pressure on global prices.
2) If the yen collapses, it can’t be good news for either Europe or us, as the article points out.
3) This is good news for Korea and Taiwan, and even China, who will pick up a lot of the manufacturing slack at least in the near term.
4) Expect to hear a lot of ignorance about how this is the best thing that could have happened to the Japanese economy, with all the jobs that will be created rebuilding, and comparisons to how they recovered from much worse devastation after the war. This will be a display of the broken window fallacy, and it will be ignoring the fact that the resources necessary for that renaissance (which took decades) came from the US. Any time wealth is destroyed (see “cash for clunkers”), the world is worse off, even if localities benefit.
[Sunday morning update]
The financial impact: five things to watch.
You’re definitely not thinking like a demagogue. “Let no crisis go to waste…”
Technology pundit Robert X Cringley suggests that perhaps none of the Japanese reactors will ever go back online:
http://www.cringely.com/2011/03/flea-powder-may-be-saving-lives-in-japan/
Hopefully this won’t be the case, but I would expect that all of them will be offline for months while inspections are conducted and repairs are made. This likely will result in the need for more imported oil, putting more pressure on global prices.
It worries me how vulnerable the first world economy is becoming. One or two more big hits like this and things could get really bad.
There are consequences to not running robust economies and keeping on top of things like entitlements, productivity, governmental efficiency and demographics. Sure some natural disaster might get blamed, but that is not the root cause.
The longer a recession goes on, the more entrenched it becomes – behaviors change. Increasingly people start turning on each other (zero sum game), the likelihood of revolution and war increases as does the vulnerability to disease, famine and natural disaster.
With a recession, people become focused on the present – where their next three meals are coming from, they stop investing in the future and they stop investing in each other. They stop having children, they stop doing R&D, and they stop improving infrastructure. This is all sensible enough in the short term, but if it goes on for too long, the future becomes the present and the lack of investment in that future can lead to economic collapse. Expenditures do not tend to reduce as quickly as revenues and economic collapse can become a positive feedback loop.
The US, like Japan, is playing a very dangerous game with not addressing the fundamental weaknesses and inefficiencies in its economy, its luck will not last forever.
We may see most of the financiers looking to re-set on how to pay, when to pay and how much is owed. It will do them no good to cut off the borrowers when they are down. They certainly can’t ‘foreclose’ on Japan and have the Sheriff throw out the old dead beat tenants!
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“Toyota’s phone calls to its plants in affected areas were not being answered,”
I realize that the Japanese throw themselves into being good Company Men. But expecting someone to be sitting there NOW, in case Tokyo calls, seems shortsighted even by Asian standards. I expect that the phone answering person is either dead or attempting to stay alive in a very bad situation.
And doing so with a “…and screw Toyota” attitude.
Sadly, the chain of coolant losses affecting Japanese reactors will give Obama the perfect excuse to delay any nuclear construction in America, not that he was doing anything but delaying it anyway. He won’t even issue an offshore drilling permit till the government spends 15 years figuring out if drilling can be done “safely.”
Ironically, even though Japan has four missing trains, with probably hundreds of passengers dead, Obama’s plans for high-speed rail won’t be re-examined in the same light that nuclear will. As an aside, how much would it cost to make sure high-speed rail lines (and their speeding trains) can take a magnitude 9.0 earthquake? I’d guess a million dollars a foot.
I’m curious to know how Japan’s major wind farms did. They had installed about 2 GWe of wind turbines, and how many are lying shattered across the landscape? If the answer is “most of them”, I think it would point to another flaw in green energy plans.
Obama wasn’t delaying nuclear construction in America — utilities who basically said “we won’t do it without lots of money from Uncle Sugar” were doing a fine job of stopping it all by themselves.
(The large amount of natural gas that will be coming from shale means gas turbines will continue to stifle nuke development here as they have done for the past few decades.)
There was a long stretch where permits were auto-denied because of “inadequate provision for permanent storage.” Read: There is no such thing as “permanent storage” until Yucca Mountain is finished. And it wavers between dead and mostly-dead.
Al: link? You may be thinking of obstacles that were thrown up to life extension of existing nuclear plants, where wet storage pools were filling up (since resolved with the acceptance of dry cask storage), but AFAIK there were no plans for new plants in the US that were blocked by such considerations. Utilities lost all interest in new nukes after their costs came in too high and natural gas became so cheap.
“I’m curious to know how Japan’s major wind farms did.”
Excellent question, and one for which I find no answer (at all) in the news.
The immediate solution would be to put them off of the coast, which makes sense from the standpoint of Japan’s extremely limited land area. The wind nuts are all over this solution, though commentary on their part as to what happens in a typhoon is curiously lacking — as it was from Pickens when he was promoting the installation of wind farms throughout Tornado Alley.
Paul, mostly dredging that up from longterm memory – engineering classes in the pre-internet (or, ‘internet is 100 computers connected by string era’) and nukes-are-waning era. The entire pool of NukEs were shifting towards fusion or asking questions like “So, what are the ChemE’s classes like?”
It seemed like an acceptance that permits would be denied. Much like very few people bothered to even apply for gun permits in a couple of places pre-Heller. It wasn’t that your permit would be denied, just that you’d never get accepted.
Much like an extension of the issues in storage at existing plants: “If we can’t even get this extension, why bother with a new plant… which would need this same permission and wouldn’t be grandfathered in.”
I don’t doubt that pricing was the ultimate tipping point, but a large part of pricing anything this large is the budget for legal fees and compliance. Overlookable and seemingly minor lines like “must provide suitable permanent storage for all waste” can turn into very large estimates when one realizes even Hanford doesn’t qualify.
Add in the fact that certain groups were using just about every method in the book to harass nuclear plant production and make them unprofitable, and the government at times tacitly supported them…
For a business, it’s often easier to go with the flow and get out of the way of political agendas… unless you can figure out how to harness one yourself.
With regards to the “reconstruction was good for Japan” argument, I don’t think the argument was ever that all that post-WWII rebuilding was good for the Japanese economy because it was inherently stimulating. At least the version I’ve always heard is that it led to a system-wide modernization of Japanese industry, which gave them a competitive edge when competing with western powers who hadn’t had their factories smashed, and who were therefore slower to modernize and kept relying on out-dated plant. Much the same was said of Germany. Whether this view is correct or not, I’m not sure. I just don’t think it was necessarily the “broken glass” argument that was applied to this situation. (Yes, I know both Japan and Germany had some pretty important cultural factors at play too, and foreign aid was vital.)
I can’t believe how the media is freaking out about the nuclear plant problems. According to reports by the japanese, the worst of the radioactivity around the plant is measured at something like 40 microSv/hr, or 0.004 rem/hr, 100 rem being required for radiation sickness. If this is the case, nothing radiologically dangerous has happened yet. (The explosion did injure some people).
And yet, we have people freaking out about “fallout” heading towards the west coast. It’s insanity. In a sane world, the nuclear plant wouldn’t even make the page next to all the other disasters in Japan.
Ams,
In the risk communication field this is referred to Risk Amplification, where folks takes a small risk and blow it all out of proportion because of its link to something that creates deep seated fears, in this case the word nuclear. Google Paul Slovic in Google Scholar and you will find a number of articles on it, including some that deal with space nuclear power. I discussed the issue in detail in my doctoral dissertation on Commercial Spaceports in 1994.
Since its based on emotion and perception it’s nearly impossible to counter with logic and rational arguments. Your only hope is to use analogy – i.e. the increase health risks are less than a transpolar flight from Japan to Europe…
The fundamental problem with the Japanese economy is its aging population. If this disaster creates a baby boom, as often happens with major disasters, it could actually revitalize it in the long run.
A second POSSIBLE long term impact, one with implications for space entrepreneurs, is if it focuses Japan on options like Space Based Solar Power. Yes, I know the economics of nuclear power are much better, but this would be politically driven with economics a secondary factor.
If what they’re reporting now (40 rem/hr) is correct, then there are now dangerous levels of radiation around the plant.
What we will see is a big uptick in imports from the US, and loss of export capacity in Japan will boost US exports, leading china to start significant dumping in various industries that will be undeniable. Expect WTO to collapse.
Vermont Yankee nuke plant, similar to the Fukushima reactors, will, despite earning a AEC license renewal the day before this disaster, be stymied in the Vermont legislature as all the tree hugging idiots refuse to recognise that Vermont will never see an earthquake even 1/1000th as powerful as the Sendai quake, and the Connecticutt river will never see a tsunami…