Wednesday, August 31

The hopping mad actuary as engine of rapid innovation

I've been reading your blog for more than a half year. A lot of the things you said came together for me last night as I realized we're facing the possible loss of New Orleans.

Pork barrel politics and wars between Democrats and Republicans about ideological issues took up a lot of energy and diverted attention and resources from fixing critical structural problems in cities and regions across America. Then around 2000 events started forcing Americans to deal with situations that we put off dealing with for decades, such as our aged electrical grid system, the policy on handling forest fires, the illegal immigrant situation, vulnerability of port cities to hurricanes and other natural disasters, our aged [oil] refinery system, the list goes on.

I think you looked at those situations as a whole and saw the end of an era approaching. That explains your tough line about development and aid policies and in general policy toward developing countries. You've been warning that other countries shouldn't assume that America's level of assistance over the past half century will remain the same.

My question is whether you think the government and the public will see the Katrina disaster as an interruption or a wake-up call, once the immediate crisis has passed.
Tom in Sioux City"

Dear Tom:
The "wakeup call" stage is long past; that stage came with Hurricane Andrew. At this moment the CEOs of US oil and refinery companies would prefer to face the entire remnants of al Qaeda rather than meet one insurance claims adjuster in a dark alley. CEOs at Lockheed and all other major corporations in the New Orleans area share the same preference.

This is what's known as increasing the R&D budget at the point of a gun. This is America, not Bangladesh. So 25% of a major US industry shouldn't be shot to hell for weeks because of a storm. A key American city shouldn't be 80% flooded within 24 hours of a storm and with no immediate way to deal with rising waters.

The only question now is whether to rebuild or move New Orleans. If they want to rebuild, Louisiana has to spend megabucks on existing technologies or ask for new ones, if they want to perch a key American city below sea level between a river and a lake in a hurricane alley.

If they don't have the bucks -- either the federal government pulls a rabbit out of the hat or New Orleans is removed from the map.

I think the American public understands that -- or they will, by the end of this week.

Regarding your comments, I hope I haven't given the impression that I see America tottering to the poorhouse. This is an incredibly powerful, wealthy and vital nation. Yet our level of assistance to other countries waxes and wanes according to our domestic needs and foreign policy emphasis. That's a self-evident fact many countries have come to ignore. They need to pay attention to the fact.

I don't see the line I'm taking as tough; I'm just squarely confronting realities and urging others to do the same. American aid and development policies were not overhauled when the Cold War ended, just as US defense policy was not overhauled until 9/11 forced a review. It's past time for the overhaul.

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