A Japanese house swept to see by Tsunami. Photo by US Navy Mass Communication Specialist 3rd Class Dylan McCord
To turn human horror into statistics and data is heartless, a psychological defense, and a pragmatic response.
Japan illustrates two types of causalities and inevitabilities that impact economic forms: physics and relationships. For many hours, government executives and business executives have pondered the causal calculus of Japan’s disasters, trying to guess the probabilities being created from all the confounding variables. It's already tagged as the Japan Effect.
Why? Because steps taken now will have huge impact. The potential futures we’ve yet to see unfold depend on these first few steps.
Before last Friday’s 9.0 earthquake (the earthquake was upgraded from 8.9), Japanese disasters were something that brought up old Godzilla movies in our minds, and more distantly, the horrors of Nagasaki and Hiroshima. Japan is evacuating, at last count, 310,000 members of its human assets during transport problems, power grid failures, and basic water and food supply problems. The destinations of these people, both temporary and permanent, remain to be seen.
Now, as human costs swell, the Texas business community scrambles to both defend against the consequences of Japan, and to take economic advantage of Japan.
These acts have nothing to do with compassion. These acts have everything to do with the destruction of economic assets, which, ironically, creates other economic assets. Numbers crunch on even as infrastructure crumbles, radiation spews and death mounts.
As the Japanese nuclear reactors exploded, the Japanese government pumped billions into its markets to try to prop up its economy from a total meltdown. The Chinese markets in Hong Kong and Shanghai fell. IBM shudders as at least 10 percent of its revenue originates in Japan.
Russians monitor the situation from its Southern Kuril Islands, visible from Japan. Sakalin Island hold Russia’s biggest gas reserves in the Far East. Radiation levels already have risen slightly, according to Russian monitors, and evacuation plans are being prepared if the levels continue to rise.
The so-called nuclear rennaisance, which seemed to be on an unstoppable upswing until Friday’s earthquake, has come to a screeching halt. Switzerland declared no more nuclear power plants. Germany placed a three-month delay on development of the country’s 17 nuclear power generators. In fact, 62 nuclear reactors are under construction on the planet. Another 482 are planned in various stages of plans, proposals and pitches.
Eyeballs turn towards Texas nuclear power projects. Comanche Peak at Glen Rose, which has plans to double its generating capacity, now must face questions and difficulty.
CPS Energy chief executive Doyle Beneby said Monday, three days after Japan’s onset of disasters, that the utility and NRG Energy, the majority partner in the South Texas Project expansion, stopped talks over CPS buying power from the two proposed reactors, which were scheduled to be licensed and begin construction in 2012. That construction most likely will never begin.
Both the South Texas and Glen Rose reactors reportedly supply 10 percent of Texas’ electricity.
Other Texas companies have scrambled, and continue to scramble with their response. Within hours, Texas Instruments quickly assessed damage at its two damaged Japanese factories and began shifting production to other factories. Austin's Freescale Semiconductor shut down its siicon wafer plant, which was near the epicenter of the quake. Most Texas oil companies, which have been in a huge revival with ongoing Middle East disruptions, continue to ramp up as nuclear energy takes a hit. And the sell of uranium stocks makes you ponder what Lewisville's Uranium Resources Inc.'s response will be.
Who would think days ago the news of the Middle East would be overshadowed?
Early winners from this scenario will be the more traditional energies of oil and gas and coal. Long term winners will be renewable and alternate energies.
The shoes continue to drop. Texas business executives watch and wait and calculate.