Tuesday, December 18, 2012

Fukushima and the Privatization of Risk 2: What is the Privatization of Risk?

In the summer of 2012, the Japanese Diet issued a report chaired by Kiyoshi Kurokawa, a professor emeritus at the University of Tokyo, sharply chastising the management of the disaster by the Japanese Government and Tepco in the days immediately following the earthquake. The Diet report concludes that managing panic was prioritized over data-driven evacuation of citizens. The Diet report does not speculate on the potential effects of the disaster. However, concerns have been raised about the long term effects on citizens in Fukushima, particularly for children given their special vulnerabilities to ionizing radiation. 
Yet, cancers and other diseases caused by radiation typically take years, if not decades, to manifest. Therefore, the true risks for Fukushima residents and others exposed to Fukushima fallout will only be realized in the future, retrospectively, through epidemiological studies. These studies will be challenged by layer upon layer of uncertainty that complicate our understanding of the disaster. How much radiation was released into the air and ocean from March 2011 until today? How much radiation will bio-accumulate in human beings and what health effects can we expect? In a sense, the very uncertainty surrounding the scale of the disaster and the scope of its effects result in the privatization of risk.
The privatization of risk is a global social trend occurring in myriad ways as risk is shifted from organized entities – such as government and corporations -- to private citizens. Risk is privatized when organized institutions re-negotiate social and economic contracts so that risk is de-collectivized. Jacob Hacker was one of the first to describe how economic risk was being displaced from government and corporations to individuals and their families. The transfer of risk Hacker observed is a trend that can be found globally. 
Jacob Hacker describes his understanding of the privatization of risk here:
the shift of responsibility for managing economic risk from government and employers onto individuals and their families. I have elsewhere called this “The Great Risk Shift” (Hacker 2006), and it is, in my view, the defining economic transformation of our times. The individual management of the economic risks of modern capitalism, whether through private retirement accounts or through personal investments in education and housing, has never been as widespread or as widely celebrated as it is today. Yet with this responsibility has come pressing new questions about the ability of individuals to perceive, plan for, and secure themselves against the most threatening risks to their financial welfare. [end excerpt from Hacker. See full discussion here )
Naomi Klein described this convergence of natural disaster and privatization of risk in The Shock Doctrine. She has found the privatization of risk occurring in the response and aftermath of varied disasters ranging across the 2004 Asian Tsunami, 2005 Hurricane Katrina, and the Greek financial crisis of 2012. You can watch her 7 minute video here
Another way of looking at the privatization of risk is to examine externalities. Externalities are indirect effects of production or consumption that affect individuals who are not the originators of the activity.[i] Industrial pollutants producing health risks for citizens illustrate externalities. Health externalities are largely absorbed by citizens through personal health spending and social and occupational impacts. Measurement of externalities can be challenging and tends to be retroactive in character. As explained by Kodama Tatsuhiko, head of the Radioisotope Center at the University of Tokyo, when it comes to environmental produced disease, and radiation caused cancer specifically,“epidemiological evidence is extremely hard, and in most cases, proof is impossible until all episodes finish running their course.” Tatsuhiko’s point is that firm data on the relationship between disease and environmental causes are typically available only retrospectively. Thus, the affected present population typically absorbs the majority of the economic and social impacts. Externalities privatize risk.
The risk shifts described by Hacker occurs as the Japanese government shifts the costs of the disaster from Tepco and the other nuclear utilities to Japanese citizens in the form of tax-payer supported bailouts and by allowing Tepco to pass on rate increases to consumers to pay for the disaster. In the aftermath of the disaster, the Japanese government has systematically shifted the costs of clean-up and decontamination to the prefectures and local communities. The risk is shifted once again to citizens.  Below find news article that describes how the decontamination process is being shifted to Japanese citizens:

Soil issue buried for lack of storage By KAZUMA TARUMI Friday, July 27, 2012. The Japan Times http://www.japantimes.co.jp/text/nn20120727f1.html

[Excerpted] At a hamlet in a mountainous area where decontamination was attempted last autumn, airborne radiation was recently found to have returned to 2 microsieverts per hour, the same as it was beforehand and too high for human habitation, local officials said.
"I imagine it's cesium dust coming from the hill behind the village," a local chief lamented. "All we can do is decontaminate the area again, but there is nowhere to store the soil."...
...Anticipating a storage space shortage, the central government has been advocating the "upside-down" method of storage — which actually means burying the tainted topsoil below that excavated from further down, instead of collecting it for storage.
This method has been strongly criticized, especially by those who were forced to leave their hometowns behind.
"This is simply a measure to reduce (radiation)," an official in the deserted Fukushima village of Katsurao angrily said. "It's nothing more than an attempt to conceal radioactive substances."
...Many officials in the designated municipalities said they felt the central government had changed its stance on its responsibilities and involvement in the decontamination process...


[i]           Laffont, J.J."externalities." The New Palgrave Dictionary of Economics. Second Edition. Eds.  Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008. The New Palgrave Dictionary of Economics Online.   Palgrave Macmillan. 10 December 2012

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