Regional Analysis Brief: South China Sea
Source: Energy Information Administration
The East China Sea is a semi-closed sea bordered by the Yellow Sea to the north, the South China Sea and Taiwan to the South, Japan’s Ryukyu and Kyushu islands to the East and the Chinese mainland to the West. Evidence pointing to potentially abundant oil and natural gas deposits has made the sea a source of contention between Japan and China, the two largest energy consumers in Asia.
The sea has a total area of approximately 482,000 square miles, consisting mostly of the continental shelf and the Xihu/Okinawa (Chinese name/Japanese name) trough, a back-arc basin formed about 300 miles southeast of Shanghai between the two countries. The disputed eight Daioyu/Senkaku (Chinese/Japanese name) islands lie to the northeast of Taiwan, with the largest of them two miles long and less than a mile wide. Though barren, the islands are important for strategic and political reasons, as ownership can be used to bolster claims to the surrounding sea and its resources under the United Nations Convention on the Law of the Sea. To date, China and Japan have not resolved their ownership dispute, preventing wide-scale exploration and development of East China Sea hydrocarbons.
Source: Brookings Institution
When it comes to Japan’s defense, the Japanese political system and the Japan Self-Defense Force independently decide the national policies as they are ultimately responsible for the country’s safety and security. However, due to the crucial nature of the U.S.-Japan alliance to Japan’s overall security, it is impractical not to take into account American thinking. As a result, it is important to better understand where and how American thinking on Japanese security is influenced.
The scope of this research goes beyond the official statements of the legislative and executive branches of the U.S. government. The author sought to explore the role that experts and think tanks play in American discourse and opinion of Japanese security. This included extensive research of American media reports on Japanese security issues as well as interviews of key American experts and opinion leaders on Japan, mostly located in and around Washington, DC.
This project is therefore unique and novel in its approach to this key topic in Japan and the U.S. A number of Japanese reports have been published in the past about American experts’ views towards Japan, yet few incorporate both a survey of media and interviews with key current figures or focus exclusively on Japanese defense. Moreover, such viewpoints and thoughts are always changing; therefore, it is meaningful to spot the current status at such a crucial time of change, both in the U.S. and Japan, not to mention the wider Asia-Pacific region.
Rainmakers: Why Bad Weather Means Good Productivity (PDF)
Source: Harvard Business School Working Paper
People believe that weather conditions influence their everyday work life, but to date, little is known about how weather affects individual productivity. Most people believe that bad weather conditions reduce productivity. In this research, we predict and find just the opposite. Drawing on cognitive psychology research, we propose that bad weather increases individual productivity by eliminating potential cognitive distractions resulting from good weather. When the weather is bad, individuals may focus more on their work rather than thinking about activities they could engage in outside of work. We tested our hypotheses using both field and lab data. First, we use field data on employees’ productivity from a mid-size bank in Japan, which we then match with daily weather data to investigate the effect of bad weather conditions (in terms of precipitation, visibility, and temperature) on productivity. Second, we use a laboratory experiment to examine the psychological mechanism explaining the relationship between bad weather and increased productivity. Our findings support our proposed model and suggest that worker productivity is higher on bad rather than good weather days. We discuss the implications of our findings for workers and managers.
Country Analysis Brief: Japan
Source: Energy Information Administration
Japan has few domestic energy resources and is only 16 percent energy self-sufficient. It is the third largest oil consumer in the world behind the United States and China and the third-largest net importer of crude oil. It is the world’s largest importer of liquefied natural gas (LNG) and second largest importer of coal. In light of the country’s lack of sufficient domestic hydrocarbon resources, Japanese energy companies have actively pursued participation in upstream oil and natural gas projects overseas and provide engineering, construction, financial, and project management services for energy projects around the world. Japan is one of the major exporters of energy-sector capital equipment, and has a strong energy research and development (R&D) program supported by the government, which pursues energy efficiency measures domestically in order to increase the country’s energy security and reduce carbon dioxide emissions.
On March 11, 2011, a 9.0 magnitude earthquake struck off the coast of Sendai, Japan, triggering a large tsunami. The earthquake and ensuing damage resulted in an immediate shutdown of 12,000 MW of electric generating capacity at four nuclear power stations. Other energy infrastructure such as electrical grid, refineries, and gas and oil-fired power plants were also affected by the earthquake, though some of these facilities were restored. Between the 2011 earthquake and May 2012, Japan lost all of its nuclear capacity due to scheduled maintenance and the challenge facilities face in gaining government approvals to return to operation. Japan is substituting the loss of nuclear fuel for the power sector with additional natural gas, low-sulfur crude oil, and fuel oil.
Comparison of coffee, tea and green tea consumption between Japanese with and without metabolic syndrome in a cross-sectional study
There are some reports that coffee consumption improves insulin resistance. Therefore, we investigated the link between metabolic syndrome and coffee, tea and green tea consumption in Japanese. We used data of 150 men and 227 women who were not taking any medications, aged 22 – 74 years, in this cross-sectional investigation study. Habitual coffee, tea and green tea consumption was defined as drinking one or more cups of coffee, tea and green tea per day. The diagnosis of metabolic syndrome was based on the Japanese criteria. In subjects without medications, 34 men (22.7%) and 10 women (4.4%) were diagnosed with metabolic syndrome. Coffee and green tea consumption was weakly and positively correlated with age in women. Significant differences of coffee consumption between women with and without abdominal obesity, dyslipidemia and hypertension, tea consumption between men with and without dyslipidemia were noted after adjusting for age. However, there were no significant differences of other consumption between subjects with and without metabolic syndrome in both sexes. Among Japanese not taking medications, coffee, tea and green tea consumption was not clearly associated with metabolic syndrome in the Japanese population.
Japan-U.S. Relations: Issues for Congress (PDF)
Source: Congressional Research Service (via Federation of American Scientists)
The post-World War II U.S.-Japan alliance has long been an anchor of the U.S. security role in East Asia. The alliance facilitates the forward deployment of about 36,000 U.S. troops and other U.S. military assets in the Asia-Pacific, thereby undergirding U.S. national security strategy in the region. For Japan, the alliance and the U.S. nuclear umbrella provide maneuvering room in dealing with its neighbors, particularly China and North Korea.
When a devastating earthquake and tsunami hit Japan on March 11, 2011, U.S.-Japan relations were stable but still recovering from a difficult period in 2009-2010. The Democratic Party of Japan’s (DPJ’s) landslide victory in the August 2009 elections for the Lower House of Japan’s legislature marked the end of an era in Japan; it was the first time Japan’s Liberal Democratic Party (LDP) was voted out of office. The LDP had ruled Japan virtually uninterrupted since 1955. Since the resignation of the DPJ’s first prime minister, Yukio Hatoyama, in June 2010, bilateral relations have been smoother under the leadership of Naoto Kan and Yoshihiko Noda. The party appears to have shifted its strategic thinking after a series of provocations from North Korea and indications of growing assertiveness from the Chinese military in disputed waters in 2010. The massive and immediate relief provided by the United States following the March 11 disaster bolstered the relationship further.
Difficult problems remain in the alliance, particularly in resolving problems related to the stationing of marines on Okinawa. In April 2012 the governments agreed to relocate several thousand marines elsewhere in the region, but have been unable to make serious progress on implementing a 2006 agreement to relocate the controversial Futenma Marine Air Station to a less densely populated location on Okinawa. Futenma Air Base remains open and presents a risk of an accident or crime that could exacerbate local-base relations further. In addition, concerns and uncertainty about the cost of the realignment plans has drawn criticism from several U.S. senators, putting funding at risk.
Japan is one of the United States’ most important economic partners. Outside of North America, it is the United States’ second-largest export market and second-largest source of imports. Japanese firms are the United States’ second-largest source of foreign direct investment, and Japanese investors are the second-largest foreign holders of U.S. treasuries, helping to finance the U.S. deficit and reduce upward pressure on U.S. interest rates. Bilateral trade friction has decreased in recent years, partly because U.S. concern about the trade deficit with Japan has been replaced by concern about a much larger deficit with China. One exception was U.S. criticism over Japan’s decision in 2003 to ban imports of U.S. beef, which have since resumed, but on a limited basis.
However, the economic problems in Japan and the United States associated with the credit crisis and the related economic recession, together with the impact of the March 11 disasters, have played a role in the bilateral economic agenda. Japan has been hit particularly hard by the financial crisis and the subsequent economic downturn. Japan’s gross domestic product (GDP) declined 1.2% in 2008 and 5.3% in 2009 but grew 4.0% in 2010. It declined 0.7% in 2011. However, the major focus of discussions has been on Japan’s expressed interest in joining the Trans-Pacific Partnership (TPP) and under what conditions Japan might join.
To assess the Japanese experience, The Heritage Foundation reassembled a team of experts to evaluate Japan’s long-term efforts to recover from the Great Eastern Japan Earthquake and to prepare for future catastrophes. Based on extensive literature and interviews with Japanese officials and experts, the team identified four critical areas that affect response to a catastrophe: recovery and resiliency of critical infrastructure, environmental remediation, compensation and disaster assistance, and population resiliency. In each area, the team made key observations, determined findings, and developed recommendations for learning from Japan’s experience.
Effects of Radiation from Fukushima Dai-ichi on the U.S. Marine Environment
Source: Congressional Research Service (via Federation of American Scientists)
The massive Tohoku earthquake and tsunami of March 11, 2011, caused extensive damage in northeastern Japan, including damage to the Fukushima Dai-ichi nuclear power installation, which resulted in the release of radiation. Some have called this incident the biggest manmade release ever of radioactive material into the oceans. Concerns arose about the potential effects of this released radiation on the U.S. marine environment and resources.
Both ocean currents and atmospheric winds have the potential to transport radiation over and into marine waters under U.S. jurisdiction. It is unknown whether marine organisms that migrate through or near Japanese waters to locations where they might subsequently be harvested by U.S. fishermen (possibly some albacore tuna or salmon in the North Pacific) might have been exposed to radiation in or near Japanese waters, or might have consumed prey with accumulated radioactive contaminants.
High levels of radioactive iodine-131 (with a half-life of about 8 days), cesium-137 (with a halflife of about 30 years), and cesium-134 (with a half-life of about 2 years) were measured in seawater adjacent to the Fukushima Dai-ichi site after the March 2011 events. EPA rainfall monitors in California, Idaho, and Minnesota detected trace amounts of radioactive iodine, cesium, and tellurium consistent with the Japanese nuclear incident, at concentrations below any level of concern. It is uncertain how precipitation of radioactive elements from the atmosphere may have affected radiation levels in the marine environment.
Scientists have stated that radiation in the ocean very quickly becomes diluted and would not be a problem beyond the coast of Japan. The same is true of radiation carried by winds. Barring another unanticipated release, radioactive contaminants from Fukushima Dai-ichi should be sufficiently dispersed over time that they will not prove to be a serious health threat elsewhere, unless they bioaccumulate in migratory fish or find their way directly to another part of the world through food or other commercial products.
Radioactive contamination of seafood from the nuclear disaster in Japan has not emerged as a food safety problem for consumers in the United States. According to the U.S. Food and Drug Administration (FDA), the damage to infrastructure in Japan limited food production and associated exports from areas near the Fukushima nuclear facility. FDA and Customs and Border Protection continue to screen imported foods from Japan, including seafood, before they can enter the U.S. food supply.
Based on computer modeling of ocean currents, debris from the tsunami produced by the Tohoku earthquake was projected to spread eastward from Japan in the North Pacific Subtropical Gyre. Approximately two to three years after the event, the debris plume likely will reach the U.S. West Coast, dumping debris on California beaches and the beaches of British Columbia, Alaska, and Baja California. Although much of the radioactive release from Fukushima Dai-ichi is believed to have occurred after the tsunami, there is the possibility that some of the tsunami debris might also be contaminated with radiation.
Guam: U.S. Defense Deployments
Source: Source: Congressional Research Service (via Federation of American Scientists)
Since 2000, the U.S. military has been building up forward-deployed forces on the westernmost U.S. territory of Guam to increase U.S. presence, deterrence, and power projection for potential responses to crises and disasters, counterterrorism, and contingencies in support of South Korea, Japan, the Philippines, Taiwan, or elsewhere in Asia. Since 2006, three joint exercises based at Guam called “Valiant Shield” have boosted U.S. military readiness in the Asian-Pacific region. The defense buildup on Guam has been moderate. China still has concerns about Guam’s buildup, suspecting it to be directed against China. There has been concern that China and North Korea could target Guam with missiles. Still, Guam’s role increased in engaging with China’s military.
In 2006, the United States and Japan agreed on a Realignment Roadmap to strengthen their alliance, including a buildup on Guam to cost $10.3 billion, with Japan contributing 60%. Goals were to start the related construction on Guam by 2010 and to complete relocation of about 8,000 marines from Okinawa to Guam by 2014. In Tokyo on February 17, 2009, the Secretary of State signed the bilateral “Agreement Between the Government of the United States of America and the Government of Japan Concerning the Implementation of the Relocation of the III Marine Expeditionary Force Personnel and Their Dependents From Okinawa to Guam” that reaffirmed the “Roadmap” of May 1, 2006. The two governments agreed that of the estimated $10.27 billion cost of the facilities and infrastructure development for the relocation, Japan will provide $6.09 billion, including up to $2.8 billion in direct cash contributions (in FY2008 dollars). The United States committed to fund $3.18 billion plus $1 billion for a road for a total of $4.18 billion.
However, completion of the marines’ relocation by 2014 would be unlikely, and the original realignment actually would have involved more than moving 8,000 marines to Guam. In September 2009, the Democratic Party of Japan (DPJ) became the ruling party. This political change raised uncertainty as Japan sought to re-negotiate the agreement, even while the United States sought its implementation. The dispute over the location on Okinawa of the Futenma Replacement Facility (FRF) to replace the Marine Corps Air Station Futenma raised implications for the relocation of marines from Okinawa to Guam. Then, North Korea’s attack on South Korea’s naval ship Cheonan in March 2010, and China’s deployment of its Navy near Okinawa and confrontation with Japan’s forces in April, catalyzed Japan to resolve the dispute in favor of stronger deterrence in alliance with the United States. On May 28, the Secretaries of Defense and State and their counterparts in Japan issued a “2+2” Joint Statement, in which they reaffirmed the 2006 Roadmap and the 2009 Agreement. In September 2010, the Navy and Army issued a Record of Decision that deferred some decisions for Guam. Nonetheless, despite the dispute over the FRF, Japan has budgeted for direct contributions and loans for the marines’ relocation to Guam.
By 2011, some Members urged attention to concerns that included Japan’s impasse, expanded costs, and the delay in the realignment even as the U.S military presence and readiness remain critical. On May 11, 2011, Senators Carl Levin, John McCain, and Jim Webb called for a review of plans to restructure military forces in South Korea, Japan, and Guam. Meanwhile, President Obama issued in January 2012 a new strategy of rebalancing priorities more to the Pacific. Finally, on February 8, the United States and Japan agreed to “adjust” the Roadmap and separate the move of marines from the plan for the FRF, in order to make progress separately. According to news reports, of 8,000 marines to transfer from Okinawa, only 4,700 could move to Guam. Legislation includes the National Defense Authorization Act (NDAA) for FY2012, P.L. 112-81. Updated as warranted, this CRS Report discusses major developments and policy issues related to the defense buildup.
U.S.-Japan Economic Relations: Significance, Prospects, and Policy Options (PDF)
Source: Congressional Research Service (via U.S. Department of State Foreign Press Center)
Japan and the United States are the two largest economic powers. Together they account for over 30% of world domestic product, for a significant portion of international trade in goods and services, and for a major portion of international investment. This economic clout makes the United States and Japan potentially powerful actors in the world economy. Economic conditions in the United States and Japan have a significant impact on the rest of the world. Furthermore, the U.S.-Japan bilateral economic relationship can influence economic conditions in other countries.
The U.S.-Japan economic relationship is very strong and mutually advantageous. The two economies are highly integrated via trade in goods and services—they are large markets for each other’s exports and important sources of imports. More importantly, Japan and the United States are closely connected via capital flows. Japan is a major foreign source of financing of the U.S. national debt and will likely remain so for the foreseeable future, as the mounting U.S. debt needs to be financed and the stock of U.S. domestic savings remains insufficient to meet the demand. Japan is also a significant source of foreign private portfolio and direct investment in the United States, and the United States is the origin of much of the foreign investment in Japan.
The relative significance of Japan and the United States as each other’s economic partner has diminished somewhat with the rise of China as an economic power. For example, China has overtaken Japan and is the largest source of foreign financing of the U.S. national debt. In addition, U.S. economic ties with Canada, Mexico, and China have deepened, further eroding the direct relevance of Japan. Nevertheless, analyses of trade and other economic data suggest that the bilateral relationship remains important, and policy leaders of both countries face the challenge of how to manage it.
During the last decade policy leaders seem to have made a deliberate effort to drastically reduce the friction that prevailed in the economic relationship. On the one hand, this calmer environment has stabilized the bilateral relationship and permitted the two countries to focus their attention on other issues of mutual interest, such as national security. On the other hand, as some have argued, the friendlier environment masks serious problems that require more attention, such as continuing Japanese failure to resolve long-standing market access barriers to U.S. exports. Failure to resolve any of these outstanding issues could cause heightened friction between the two countries.
More generally, other issues regarding U.S.-Japan economic relations may emerge on the agenda of the 112th Congress. U.S. and Japanese leaders have several options on how to manage their relationship, including stronger reliance on the World Trade Organization; special bilateral negotiating frameworks and agreements; or a free trade agreement. On November 11, 2011, Prime Minister Noda announced at a press conference that he decided, after many consultations with potentially affected parties, that “[Japan would] enter into consultations toward participating in the TPP negotiations with the countries concerned on the occasion of the [November 12-13, 2011] APEC Economic Leaders meeting in Honolulu, Hawaii….” Japan’s participation in the TPP will likely be the focal point of U.S.-Japan economic discussion for the foreseeable future.
Current Price Topics: The Impact of the Earthquake in Japan on U.S. Imports
Source: Bureau of Labor Statistics
On March 11, 2011, northeast Japan was hit with the strongest recorded earthquake in that nation’s history, measuring 9.0 on the Richter scale. The earthquake and subsequent tsunami, which together left more than 20,000 people dead or missing, also damaged much of Japan’s infrastructure, especially the country’s electric power grid. The economic impact of the disaster on Japan, including its impact on the Japanese export trade to the United States, remained uncertain at the time, in terms of both the availability and prices of Japanese goods.
Despite this uncertainty, and that of the impact of the quake on the world economy, a major earthquake in Japan is not unprecedented. The Hanshin earthquake that hit Kobe on January 17, 1995, offers some insight into what might be expected this time. Although that incident was a considerably smaller seismic event, measuring 6.8 on the Richter scale, the affected regions made up 12.4 percent of Japan’s GDP at the time, compared with 7.8 percent in the less industrialized northeast region that bore the brunt of the recent disaster. In 1995, despite extensive damage in the region of the quake, Japanese output actually increased in February and March 1995, following a 1-month drop in production. Even in Kobe, manufacturing output was at 98 percent of prequake levels within 18 months of the disaster.
What was different with the 2011 earthquake was the impact on Japan’s overall power grid from the damage done to a major nuclear powerplant. That damage led to rolling blackouts which, combined with the damage from the quake, forced a number of major companies, such as Toyota, Sony, Honda, Nissan, Toshiba, and Texas Instruments, to either shut down or cut back production at multiple plants. Industrial production in Japan, which had risen 1.9 percent from January 2010 to February 2011, plunged 6.4 percent in March in the aftermath of the disaster. Once the power grid was largely restored, and thanks in part to the spare-production capacity in Japan, industrial production recovered to nearly the February level by July.
Interestingly, the value of Japanese exports actually increased in March 2011, but largely because goods had already left Japanese ports at the time of the earthquake. Exports did fall sharply the next 2 months, and in May were 10.3 percent below the value of what was exported the previous May. In subsequent months, the value of exports recovered: August recorded a 12-month increase of 2.8 percent, the first 12-month advance in the measure since February. Despite the August increase in the value of exports Japan recorded a 10.1 billion dollar trade deficit, that same month because of a surge in the value of imports, which was 12.4 percent higher in August than at the same point in 2010. Much of the increase in imports has been in the form of higher fuel imports in an effort to make up for the electricity supply shortages that resulted from the closing of the Fukushima nuclear powerplants.
As regards trade with the United States, Japan is the world’s third-largest economy and ranks as the fourth-largest import trading partner of the United States. In 2010, the United States imported more than 120 billion dollars of merchandise goods from Japan, representing 6.3 percent of overall imports. As can be seen in table 1, five broad harmonized product categories—motor vehicles; machinery and mechanical appliances (including computers); electrical machinery; motor vehicle parts; and optical, photographic, measuring, and medical instruments—made up almost three-quarters of total U.S. import trade with Japan.
Japan’s New Growth Strategy to Create Demand and Jobs
Source: Organisation for Economic Co-operation and Development
The New Growth Strategy aims to create demand and jobs through regulatory reform and fiscal measures. The Strategy focuses on key challenges, notably climate change and population ageing, which can be turned into sources of growth. Given Japan’s precarious fiscal position, it is essential to co-ordinate spending related to the Strategy with the medium-term fiscal plan, in part by increasing the emphasis on regulatory reform. Such measures should cover the entire economy, rather than being limited to the seven areas identified in the Strategy. Among those areas, effectively promoting green innovation will require market-based instruments to place a price on carbon, preferably through a mandatory and comprehensive emissions trading system, to promote private investment, accompanied by a range of other policies. Achieving deeper economic integration with Asia depends on reducing support for agriculture to facilitate more bilateral and regional trade agreements, while bringing down barriers to foreign direct investment and foreign workers. Policies to expand venture capital would help launch innovative firms. This Working Paper relates to the 2011 OECD Economic Survey of Japan (www.oecd.org/eco/surveys/Japan).
+ Full Paper (PDF)
New Study: U.S. Ranks Last Among High-Income Nations on Preventable Deaths, Lagging Behind as Others Improve More Rapidly
New Study: U.S. Ranks Last Among High-Income Nations on Preventable Deaths, Lagging Behind as Others Improve More Rapidly
Source: Commonwealth Fund (Health Policy)
The United States placed last among 16 high-income, industrialized nations when it comes to deaths that could potentially have been prevented by timely access to effective health care, according to a Commonwealth Fund–supported study that appeared online in the journal Health Policy this week and will be available in print on October 25th as part of the November issue. According to the study, other nations lowered their preventable death rates an average of 31 percent between 1997–98 and 2006–07, while the U.S. rate declined by only 20 percent, from 120 to 96 per 100,000. At the end of the decade, the preventable mortality rate in the U.S. was almost twice that in France, which had the lowest rate—55 per 100,000.
In “Variations in Amenable Mortality—Trends in 16 High Income Nations,” Ellen Nolte of RAND Europe and Martin McKee of the London School of Hygiene and Tropical Medicine analyzed deaths that occurred before age 75 from causes like treatable cancer, diabetes, childhood infections/respiratory diseases, and complications from surgeries. They found that an average 41 percent drop in death rates from ischemic heart disease was the primary driver of declining preventable deaths, and they estimate that if the U.S. could improve its preventable death rate to match that of the three best-performing countries—France, Australia, and Italy—84,000 fewer people would have died each year by the end of the period studied.
“This study points to substantial opportunity to prevent premature death in the United States. We spend far more than any of the comparison countries—up to twice as much—yet are improving less rapidly,” said Commonwealth Fund Senior Vice President Cathy Schoen. “The good news is we know lower death rates are achievable if we enhance access and ensure high-quality care regardless of where you live. Looking forward, reforms under the Affordable Care Act have the potential to reduce the number of preventable deaths in the U.S. We have the potential to join the leaders among high-income countries.”
Financing Recovery After a Catastrophic Earthquake or Nuclear Power Incident (PDF)
Source: Congressional Research Service (via Federation of American Scientists)
On August 23, 2011, a rare, powerful magnitude 5.8 earthquake and aftershocks hit Mineral, VA, shutting down two North Anna Power Plants located about 7 miles from the earthquake’s epicenter. The earthquake was felt from Georgia to southeast Canada. Other earthquakes have also occurred in the area, as well as in surrounding areas. For example, on July 16, 2010, a 3.6 magnitude earthquake occurred in Gaithersburg, MD, about 110 miles from the epicenter. Seismologists report that although Virginia is classified as a “moderate” seismic risk zone, since 1977, the state has experienced 160 earthquakes, of which just 16% were felt. According to the U.S. Geological Survey (USGS), this earthquake was the strongest earthquake to hit the entire states since the 5.8 magnitude tremor in 1897.
Separately, on March 11, 2011, a massive 9.0 magnitude earthquake struck off the coast of Honshu, Japan. It was the most severe and likely the costliest earthquake to hit Japan in the 130 years of recorded history. The Japan earthquake and tsunami caused more than 10,000 casualties, widespread property and infrastructure damage, blackouts, fire, and nuclear meltdowns. The nuclear crisis has compounded the challenges faced by a nation struggling to clean up and recover from the earthquake and tsunami. Two weeks later, the disaster triggered a crisis at the nuclear power facility; Japan’s government said there was a leaking reactor core at the Fukushima Dai- ichi nuclear reactor complex, releasing radioactive contamination into the atmosphere and groundwater.
In the aftermath of the recent East Coast earthquake (and shut down of the North Anna nuclear power plants) and Japan’s technological and natural disaster, U.S. policymakers are asking if it could happen here and, if so, how associated costs would be financed. In the event of a major natural disaster, several catastrophe risk financing and insurance issues could arise, including (1) the need to revisit the nature, extent, and timing of potential earthquake and tsunami hazards in the United States; (2) the adequacy of nuclear third-party liability insurance capacity; and (3) the challenges of financing recovery from natural disasters and making earthquake insurance more affordable. The latter challenge is largely a function of the national financial markets’ capacity to absorb the cost and economic burden of a devastating mega-earthquake.
Given the economic devastation in Japan, there is heightened congressional interest in finding ways to reduce disaster risk for homeowners, insurance companies, financial firms, and both federal and state governments. This report examines earthquake catastrophe risk and insurance in the United States in light of recent developments. It examines both traditional and non-traditional approaches for financing recovery from earthquake losses as well as challenges in financing catastrophe losses with insurance. The report also explores the feasibility of a federal residential earthquake insurance mechanism and assesses policy implications of such a program. Finally, the report examines legislation introduced in the 112th Congress that addresses issues related to earthquakes, including S. 637, the Earthquake Insurance Affordability Act. S. 637 would authorize the U.S. Treasury to guarantee up to $5 billion in bonds available to certified public entities, like the California Earthquake Authority (CEA), following a catastrophic seismic event. The entity would have to exhaust its claims-paying ability before the federal guarantee becomes available. The measure is designed to reduce earthquake insurance rates by reducing the need to purchase reinsurance. The bonds would be repaid with premiums.
This report will be updated as events warrant.
Japan Tsunami Current Flows Observed by HF Radars on Two Continents (PDF)
Source: Remote Sensing
Quantitative real-time observations of a tsunami have been limited to deep-water, pressure-sensor observations of changes in the sea surface elevation and observations of sea level fluctuations at the coast, which are essentially point measurements. Constrained by these data, models have been used for predictions and warning of the arrival of a tsunami, but to date no detailed verification of flow patterns nor area measurements have been possible. Here we present unique HF-radar area observations of the tsunami signal seen in current velocities as the wave train approaches the coast. Networks of coastal HF-radars are now routinely observing surface currents in many countries and we report clear results from five HF radar sites spanning a distance of 8,200 km on two continents following the magnitude 9.0 earthquake off Sendai, Japan, on 11 March 2011. We confirm the tsunami signal with three different methodologies and compare the currents observed with coastal sea level fluctuations at tide gauges. The distance offshore at which the tsunami can be detected, and hence the warning time provided, depends on the bathymetry: the wider the shallow continental shelf, the greater this time. Data from these and other radars around the Pacific rim can be used to further develop radar as an important tool to aid in tsunami observation and warning as well as post-processing comparisons between observation and model predictions.
Outdoor Advertising Control Practices in Australia, Europe, and Japan (PDF)
Source: Federal Highway Administration
Although the Highway Beautification Act (HBA) has been credited with reducing the number of nonconforming signs and removing illegal signs throughout the country, the law is controversial and costly to administer. Many have questioned whether it has controlled outdoor advertising or met the intent of the U.S. Congress. The Federal Highway Administration, American Association of State Highway and Transportation Officials, and National Cooperative Highway Research program sponsored a scanning study of Australia, Sweden, the Netherlands, and the United Kingdom to learn how they regulate outdoor advertising both inside and outside the roadway right-of-way. The scan team also conducted a desk scan of outdoor advertising practices in Japan.
In its study, the scan team observed the following: (1) context-sensitive and safety-oriented laws and regulations, (2) no regulation of nonconforming signs or distinction between on-premise and off-premise signs, (3) emphasis on safety and environmental impacts in guidelines and permit requirements, and (4) more collaboration between outdoor advertising stakeholders than in the United States. The scan team assembled implementation ideas under the following improvement goals: streamlining the program, improving efficiency, improving transparency, adopting a context-sensitive approach, and enhancing safety.