Sunday, March 20, 2011

notes on japan, nuclear power, & the week ending march 19th

what has been happening around the fukushima nuclear facility in japan has been, of course, the big story the week, and it's also been the continuing question of the week, as all we're really getting is second hand regurgitations of the pablum releases of the japanese & US governments, which often conflict in important ways beyond details...so with that caveat, i'll try to explain what i've picked up, not from specifically looking for info, but because the story & its implications have saturated the internet...as of the time of this writing, (saturday evening) volunteer utility workers were attempting to reconnect power to the damaged plants, so the cooling pumps could be restarted to keep the reactor cores from melting down (any more than they may have already)...but even if this is successful, the real problem lies in one of the cooling ponds for spent fuel rods, which has been compromised and has leaked some or all of its water...various methods have been attempted to keep this spent fuel cool, including helicopter drops of water, at least some of which were aborted because of high radiation in the area...this situation seems to be the long term problem for the site, and one engineer opined that "The best thing to do is use as much of the Pacific Ocean as possible," ...as boron was in short supply in japan, both US & south korea are sending shiploads of boron, which slows down fission in nuclear reactions, to japan; whether that may eventually alleviate the problem or not is anyone's guess..

   a lot of what we have learned about these plants & Tokyo Electric over the past week is feeling like a little BP oil spill all over again...the plants and their operator have a history faked repair reports, cheapest way shortcuts, cozy government complicity, et al; & the weak design of the GE mark 4 reactor has been questioned since 1972... moreover, when it became clear that the cores were overheating, TEPCO postponed using seawater to cool them for almost a full day because the salt would damage their equipment...whether a correction of these aspects could have headed of this catastrophe or not is questionable, but it's clear that as long as profit motivated private enterprise is involved, corners will be cut that in the end come back & bite the rest of us...

   although some east coast japanese ports were damaged by the tsunami, and most of the infrastructure in a primary agricultural region has been destroyed, it appears the major problem facing japan right now is lack of electrical generating capacity; citigroup analysts say it may be "irreversible" and tokyo has been warned of blackouts during cold weather; this is not so much because of the loss of the infrastructure; rather, the 9.7 GW taken out of service with the six closed reactors is a lions share of the electric power in the east, which operates on US style 60Hz power; while the generating capacity in the west of japan is a legacy of 19th century german generators, which run at 50Hz, and the two systems dont talk to each other...the shortfall may eventually be made up by spare gas and diesel generating capacity, but as of yet i've yet to see a timeline as to when...

   so at present, even many of the japanese manufacturers who were not damaged by the quake have shut down their production lines, and as many are the sole makers of various automotive & electral components, manufacturing in taipei, china, and south korea is already being affected...so far, only one GM truck plant in louisiana has been shut down in the US, but japanese automakers in the US have cancelled all overtime to conserve what little parts inventory is still in the pipeline...how bad this can become globally is still anyone's guess, but in the one similar experience we had with a resin plant fire in japan in 1993, prices of semiconductors doubled in a matter of days...in just one example of the problem, making the i-phone alone involves 9 different companies, in Korea, Japan, Taipei, China, Germany, and the US...

   we are about to witness an interesting experiment with regards to the "danger" of government debt as well, because of all the industrialized countries, including the so called PIIGS of europe, no country has a higher debt to GDP ratio than does japan, which at around 200% is almost three times the effective publicly held debt of the US...so they will now be embarking on a large scale reconstruction of their infrastructure which will require even more borrowing than they have already planned for, yet over the past week their long term borrowing costs fell and the yen skyrocketed to its highest value against the dollar since world war II, prompting an emergency G7 meeting and a co-ordinated intervention in the currency markets by the Fed, the ECB, and the central banks of canada & the UK, the first time they've intervened in this fashion in 11 years..with britain embarking on austerity to curtail their debt (which has already knocked their GDP into negative territory), it will be interesting to see which of the two extremes of fiscal policy proves to be more effective in the long run...

   the nuclear "accident" has also touched off a lot of debate about the future of nuclear power in this country & elsewhere; about 2 dozen articles, analysis, pro & con are included in my blog sequence with "energy & the environment", whereas the economic impacts on japan are covered with "other non-western countries"...so far, both germany and china have curtailed their nuclear power programs, but the US energy secretary Chu says we're still good to go...my own position on nuclear power originates in my days as an anti-nuke activist in the 80s, so that obviously colors what i have to say now...my objection to nuclear power is that radioactive materials are entirely different than other types of pollution, in that it's mutagenic, tetragenic and carcinogenic to a degree that no other substance is...biological life is the only & a fragile counter-entropic (i.e., generating organization rather than defaulting to randomness) force on our planet, and we dont want to upset the delicate balance that allows life to organize molecules…radioactivity is known to be one of the most potent disorganizers of life, and as such increasing it would further lower the ecological potential of the planet…deaths in auto accidents (which nuclear apologists site) or from coal induced pollution dont upset the unpinning of life on the planet in the way ionizing radiation does…that no deaths have yet been caused immediately is not the issue; the issue is the mutagenic properties of nuclear radiation; it takes four generations for the effects to even start to show up in mice; we’ve barely gone thru 2 human generations since the widespread atmospheric testing in the 50s…we still dont have a way of dealing with the spent fuel and other nuclear wastes that are a by-product of producing power in this manner; germany encases them in concrete, china ships them off to the western provinces, but japan & the US both store them on site...but spent nuclear fuel is dangerous for 100,000 years, & has a half-life of 10,000 years, which is five times longer than christianity lasted...lest we forget; there is still 740,000 cubic meters of lethally contaminated crap to clean up at cherobyl alone; the stone "sarcophagus" which encases the site is crumbing, gases as hot as 200C are escaping, and it's basically been abandoned with the breakup of the soviet union (its not russia's problem, it's the ukraine's)...in the US, we have two serious problems which are remnants of our nuclear arms programs; one is the hanford nuclear reservation on the columbia river, where 53 million gallons of nuclear waste is being stored in 177 leaky underground tanks; the other is the savannah river site in s.carolina, where the government has stored the high level radioactive waste produced at the plant on site in 51 massive underground tanks, and proposed methods for withdrawing it have proven unsafe...something else co-incidential about those two sites; just offshore from washington state is the cascadia subduction zone, very similar to the japanese quake site, & the site of a 9.2 earthquake in 1700, and the savannah river site is near the site of 1886 charleston earthquake, second only to the new madrid quakes of 1811-12 among the largest quakes east of the rockies...they say the waste wont get into the water supply...

ok, off the soapbox and back to the congresscritter's insanity...after two weeks of unproductive debate, the house and senate both passed the sixth “continuing resolution” of this fiscal year, which will fund government operations until april 8th...about $6 billion of budget cuts were agreed to by both parties, but it wasnt enough cutting for some house republicans, as 54 voted against it...the 13 votes against it in the Senate were on the principle that we shouldnt be funding the government a couple weeks at a time...

  the Fed announced that it completed it's stress tests on the nation's 19 largest banks, and to no ones surprise they all came thru in flying colors, which apparently means they can start paying dividends again...JP Morgan, Wells Fargo and SunTrust also announced stock buybacks, which reduces their bank capital, something they complained would happen under the weak Basel III capital requirements, because it would reduce their ability to lend...

there were conflicting signals in economic reports out this week, as the Philly Fed index of manufacturing activity saw its best growth since 1984, right after a similar strong report from the NY Fed district...however, both industrial production and capacity utilization declined for february...the best capacity utilization growth was for textile mills, which i can only assume that's because so many have been shuttered that any pickup shows a % growth; also, port export traffic showed a YoY decline....meanwhile, new home starts fell to their second lowest ever (since 1959) at 479K, and building permits were at the lowest level since record keeping started in 1968; multi family starts were also down, while both multi-family permits & home remodeling showed a year over year increase...not much of surprise there, as census figures are now showing home vacancy rates as high as 25% in some cities, and as high as 18% over the entire state of florida....producer prices showed a one month gain of 1.6%, almost entirely food and energy, with produce alone showing a 50% jump for the month...consumer prices showed a seasonably adjusted .5% gain, but the core inflation rate, which influences Fed policy, was only up .2%...so according to the official numbers, inflation is up either 1.1% YoY or 2.1% YoY, depending on whether you choose to eat & heat or not...GDP declined 0.8% in january, according to macroadvisors, who also forecast quarterly GDP growth to be 2.4%, barely over stall speed...and stagflation, a word i hadnt seen since the 70s, showed up in reports at least three times this week...                                                     (click on above chart to enlarge CPI components)

the above are my weekly comments that accompanied my sunday morning links mailing, which in turn was selected from my weekly blog post on the global glass onion…if you’d be interested in getting my weekly emailing of selected links that accompanies these commentaries, most coming from the aforementioned GGO posts, contact me...

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