Belmont Club

Joe Waits for the Volcano

Pinatubo eruption courtesy USGS

One of the most famous lines about waiting is naturally enough from the movie Casablanca: “And so a tortuous, round-about refugee trail sprang up. Paris to Marseilles, across the Mediterranean to Oran [in Algeria], then by train or auto or foot across the rim of Africa to Casablanca in French Morocco. Here the fortunate ones through money or influence or luck might obtain exit visas and scurry to Lisbon, and from Lisbon to the New World. But the others wait in Casablanca, and wait…and wait…and wait.”

Waiting for disaster is often worse than “getting it over with.” Two years ago Dr. Peter Ward of the U.S. Geological Survey described what it was like waiting for Mt. Agung to erupt in Bali after a number of episodes in 2017-18.

Emergency evacuation centers had been planned. Bali was prepared for what could happen, but as time wears on with no eruption, the economic fallout keeps getting worse.

Agung is capable of a very large and devastating eruption, or it might cool down and become inactive. Meanwhile, the odds are that millions of tourists, visiting tens of miles away from Mt. Agung, can continue to enjoy Bali without harm, but no one can guarantee that.

Official estimates suggest uncertainty concerning when and if Agung will erupt cost the island $151 million in the first month since the alert was raised on September 22. In this first month, Bali’s tourism sector lost $19 million, but Bali’s banking industry is expected to have the greatest losses. Balinese locals, evacuated from their homes, farms, and businesses, have lost jobs and income and will not be able to repay their debts while evacuated, costing banks in the region over $82 million per month.

But the truth is that not even the best science can exactly predict when the big one is going to come. Not in Bali, along the San Andreas Fault, Tokyo’s Kanto Plain or Taal Volcano. In the face of the unknown or what is possibly the unknowable, Japan has adopted the risk management strategies of insurance (civil defense) and diversification (redundancy). Speaking of its Internet, one notes that “the backbone topology is fully redundant and overprovisioned to ensure automatic failover.”

By contrast, Internet connection to the towns surrounding Taal is slow or down.

The Japanese approach highlights the advantages of a rising design margin, of having more than you need, in the face of an unpredictable and conceivably indeterminate threat. This raises questions for the viability of disaster-avoidance strategies that rely on the reduction of GDP, which effectively reduces the design margin. Economic output reduction is the principle method used to pursue the policy of fighting greenhouse gases.

This could mean a smaller design margin. Some have argued that GDP — and the design margin — can be simultaneously increased, but this remains a challenge. The British government noted in 2019 that much of its ability to meet carbon targets relied on exporting pollution to China.

The impact of globalisation on CO2 emissions has resulted in service-based economies creating indirect emissions by outsourcing manufacturing products to countries with lower labour costs and less stringent pollution regulations. We find that the UK is a net-importer of CO2 emissions, with most of the imported CO2 emissions coming from China. Therefore, any apparent decline in territorial CO2 emissions is overestimated. However, in recent years the UK has made genuine efforts in cutting down both its territorial and consumption-based emissions despite continued growths in its GDP per head.

While the UK has shown evidence of absolute decoupling of GDP per head and CO2 emissions, the global coupling of GDP per head and CO2 emissions has persisted. Given there is no production boundary for air pollution, the reduction of air emissions while maintaining GDP growth, is a global responsibility.

Without China and India, Green in the West would have been problematic. Without shifting the location of the smokestack industries it might have had to make do with genuinely fewer goods. Can Joe meet the challenge of the volcano with a strategy of less and less? Or is it better to store up against the unforeseeable? We wait…and wait…and wait.

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Books:

Loserthink: How Untrained Brains Are Ruining America, by Scott Adams. The creator of Dilbert has come up with a guide to spot and avoid mental habits trapping victims in their own bubbles of reality, such as the inability to get ego out of your decisions, thinking with words instead of reasons, failing to imagine alternative explanations, and making too much of coincidences.

Humanity in a Creative Universe, by Stuart A. Kauffman. Best known for his philosophy of evolutionary biology, Kauffman calls into question science’s ability to ever accurately and precisely predict the future development of biological features in organisms. He argues that our preoccupation to explain all things with scientific law has deadened our creative natures and concludes that the development of life on earth is not entirely predictable, because no theory could ever fully account for the limitless variations of evolution.

Working , by Robert A. Caro. From the two-time Pulitzer Prize-winning biographer, an unprecedented memoir of his experiences researching and writing his acclaimed books.

Private Empire: ExxonMobil and American Power, by Steve Coll. A masterful result of Coll’s indefatigable reporting, this book draws on more than 400 interviews; field reporting from the halls of Congress to the oil-laden swamps of the Niger Delta; more than 1,000 pages of previously classified U.S. documents obtained under the Freedom of Information Act; heretofore unexamined court records; and many other sources. This is a defining portrait of ExxonMobil and the place of Big Oil in American politics and foreign policy.

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Open Curtains by George Spix and Richard Fernandez. Technology represents both unlimited promise and menace. Which transpires depends on whether people can claim ownership over their knowledge or whether human informational capital continues to suffer the Tragedy of the Commons.

The War of the Words, Understanding the crisis of the early 21st century in terms of information corruption in the financial, security and political spheres

Rebranding Christianity, or why the truth shall make you free

The Three Conjectures, reflections on terrorism and the nuclear age

Storming the Castle, why government should get small

No Way In at Amazon Kindle. Fiction. A flight into peril, flashbacks to underground action.

Storm Over the South China Sea, how China is restarting history in the Pacific.