Why Risk Estimation Must Go Global
The ongoing and worsening mess at the Fukushima nuclear reactor in Japan illustrates an all-too-common failure to sufficiently plan on a global scale for catastrophic events that are exceedingly unlikely at any given place and time. The problem is bad enough when the effects are, like the aftermath of Hurricane Katrina in the United States or the earthquake in Haiti, essentially confined to one country. Everything compounds when, as with Fukushima, the effects are felt not only locally, but far and wide beyond national borders.
There is a wealth of data showing that we consistently, if irrationally, overestimate the likelihood of some events while discounting the probability of others. It would be easy to chalk this bias up as just another human foible, akin to believing that we are more in control of events than we really are, were it not such a damaging predilection when it guides public policy or global risk estimation. Basing legislation regulating gun ownership, for instance, on an irrationally high estimation of their usefulness in thwarting crime (compounded by a irrationally high estimation of the likelihood that ordinary citizens will be the victims of violent crime) is a recipe for disaster. By the same token, failing to allow for a possibility that might be extremely rare in any one place, but much more likely when risk is viewed on a global basis, is at the heart of the Fukushima mess.
Despite the presence of at least 350 commercial reactors worldwide (and another few dozen for academic or research use), apparently the world community has never felt the need to plan for a disruptive event someplace. It's a cliche, of course, but it was only a matter of time before something like Fukushima happened, and that it is in Japan is merely a matter of chance (given the abundance of significant fault lines in the world).
Strategists of all types need to allow for rare contingencies as they build scenarios to describe the future. Problems will happen someplace. What will you do if it is in your bailiwick?
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