Fukushima Tokyo Earthquake Book
Fukushima and the coming Tokyo Earthquake and what it will mean for fragile world economy is a new book by Tony Smyth.
This book is constructed around a tale of two earthquakes, one that has already occurred, and one that has not, but is imminent. The Tohoku earthquake of March 2011, its enormous tsunami, and the resultant nuclear meltdowns at Fukushima Dai-ichi power plant was by far the biggest news story of that year. It had consequences that stretched far beyond Japans borders. Subsequent to the Fukushima crisis, the German and Belgian governments pledged to phase out all nuclear plants. Switzerland abandoned plans to build new reactors, as did Italy. Kuwait, Mexico, Bulgaria and Venezuela suspended planned nuclear development. So too did West Bengal.
We live in a world that has taken energy abundance for granted. The exponential growth that has powered our economies for more than a century is heavily dependent on cheap energy, obtained from resources that are now being rapidly depleted. Peak oil is upon us. Moreover, opposition to use of fossil fuel consumption is growing, as the effects of climate change caused by use of those fuels become increasingly evident. Several chapters of this book examine whether, on a warming planet, a combination of nuclear and renewables should replace fossil fuels.
An earthquake near or under Tokyo would have effects far beyond the Japanese coastline. When the financial catastrophe of 2008 almost brought down the global banking system, the world experienced its deepest recession since the 1930s. As a direct result, living standards have fallen in many countries. Official unemployment climbed to two hundred million worldwide by 2013, and is projected to rise further. The European Central Bank, the U.S., and now Japan, have attempted to stimulate their economies by printing money (quantitive easing) and dropping interest rates to anaemic levels, creating in the process trillions of dollars of fresh debt − over $17 trillion and rising in the United States alone. We live in a world awash in debt, one whose economies are extremely fragile .
The 2011 earthquake, tsunami and resultant nuclear meltdowns represent, in total, the world’s most expensive natural disaster, with reconstruction costs in excess of $500 billion. Such a massive financial burden would be difficult for any country to bear, more so for one that has the highest debt level among advanced economies, and also the world’s most rapidly aging society. Japan’s foreign exchange reserves are the second largest in the world, some one trillion dollars invested in U. S. treasury securities. The final chapters of this book attempt to show that, should even a portion of these bonds be sold to pay for reconstruction work in an earthquake devastated Tokyo, the consequences for U.S. bonds, and consequently the world’s stock markets, would be severe.