Tuesday, March 15, 2011

Stocks Slump Worldwide as Investors Flee Risk

Investors around the world made a dash for safety on Tuesday, fearing the possibility of a nuclear catastrophe in Japan.

Justin Lane/European Pressphoto Agency

Traders on the floor of the New York Stock Exchange at the opening bell on Tuesday.

Stock indexes in the United States, Asia and Europe fell nearly 1.5 percent as traders worried that the turmoil in Japan, the world’s third-largest economy, could slow down growth worldwide. Bond prices rallied and yields fell as investors turned to safe havens like the dollar and French, German and American bonds.

For investors, the questions were urgent but largely unanswerable: How significantly would production fall in Japan? Which companies were most at risk? How would a loss of nuclear power in Japan affect energy markets worldwide?

“Today is a panic day,” said Beat Lenherr, chief global strategist at LGT Capital Management in Singapore. “The question is, Where is the bottom?”

The benchmark index in Tokyo fell more than 11 percent, its lowest close in nearly two years and its largest two-day drop since 1987.

In the United States, the Dow Jones industrial average was down 162.53 points, or 1.4 percent, in afternoon trading, while the broader Standard & Poor’s 500-stock index dropped 16.29 points, or 1.3 percent. The Nasdaq lost 37.53 points, or 1.4 percent. As investors fled risky investments, they turned to bonds, sending the yield on the benchmark 10-year Treasury bond to 3.29 percent from 3.36 percent late Monday.

European indexes also fell significantly, with the DAX index in Frankfurt shedding 3.2 percent, the CAC 40 in Paris losing 2.5 percent and the FTSE 100 in London dropping 1.4 percent.

“Investors are moving to the sidelines,” Marc Chandler, global currency strategist for Brown Brothers Harriman, said. “They are selling the things they were buying and buying the things they were selling.”

The turmoil extended to energy markets, as analysts warned that diminished growth in Japan could prompt a sharp decrease in oil demand. “We don’t know the extent to which the post-tsunami Japan is going to grow, and whether or not there will be consequences for other countries as well,” said Chris Lafakis, an energy economist for Moody’s Analytics.

Many companies with ties to Japan were hit hard. Shares of the insurance giant Aflac, which depends on Japan for much of its profit, fell more than 7 percent. Shares of General Electric dropped more than 2 percent; investors worried that the company would be liable for damages from a nuclear disaster, given its role in designing the reactors.

Luxury goods companies, which rely on strong Asian sales, were also down sharply. The luxury jeweler, Tiffany & Company, and the handbag designer, Coach, each fell more than 3 percent.

Commodity prices dropped on growth concerns after rising sharply in recent weeks. Oil prices fell $3.45 at $97.74, and copper, gold, corn, wheat and soybeans were all lower. Analysts said investors were moving their money from commodities to safer investments.

“It is a flight to cash,” Mike Zarembski, a senior commodity analyst at OptionsXpress, said. “They are selling to get into cash or the try safe havens like U.S. Treasuries, Swiss franc and U.S. dollar.”

As investors tried to assess the fallout from the crisis in Japan, the broader concern remained the potential harm to the global recovery. In particular, analysts were worried that disruption to supply lines in Japan, home to some of the world’s biggest manufacturers and technology firms, could spread to other countries and increase the risk of a global slowdown.

Economists said the disaster would almost certainly lead to a contraction in the Japanese economy in the second quarter, but that the economy could rebound later in the year as workers rebuilt infrastructure.

Carl Weinberg, chief economist at High Frequency Economics, said that “every company in Japan almost certainly faces worse prospects for growth than it did before last Friday,” when an earthquake spurred a tsunami that led to the nuclear crisis. He said Japan’s banks were particularly fragile and could affect banks in Europe and the United States.

Philippe Gijsels, head of research at BNP Paribas Fortis in Brussels, characterized the sell-off in stock markets on Tuesday as a “knee-jerk” reaction to events in Japan, but noted that policy makers have limited tools to handle major economic shocks, given the high level of budget deficits in the West and the fact that monetary policy options are almost exhausted.

Analysts at Credit Suisse and Barclays Capital have estimated the damage in Japan at up to 15 trillion yen, or $183.5 billion. Tohru Sasaki, a foreign exchange strategist at JPMorgan Chase, said that while the damage had been “very large,” in the long run, the stock market should reflect the prospect for corporate earnings. “But right now there’s no arguing with panic,” he said.

In a bid to contain the stock market sell-off and to prevent a sharp rise in the yen as companies repatriated cash to pay for the costs of the quake and tsunami, the Bank of Japan pumped more liquidity into the financial system Tuesday, adding to the record amounts that were injected Monday.

Brown Brothers said that the Bank of Japan added 8 trillion yen, or about $98 billion, to the financial system on Tuesday.

Japan radiation leaks feared as nuclear experts point to possible cover-up

Japan radiation leaks feared as nuclear experts point to possible cover-up

Lack of radiation readings echoes pattern of secrecy employed after other major accidents such as Chernobyl

    Japan nuclear explosino, Fukushima
    A screen grab taken from news footage by Japanese public broadcaster NHK shows the moment of a hydrogen explosion at the Fukushima nuclear plant. Photograph: -/AFP

    Nuclear experts have thrown doubt on the accuracy of official information issued about the Fukushima nuclear accident, saying that it followed a pattern of secrecy and cover-ups employed in other nuclear accidents. "It's impossible to get any radiation readings," said John Large, an independent nuclear engineer who has worked for the UK government and been commissioned to report on the accident for Greenpeace International.

    "The actions of the Japanese government are completely contrary to their words. They have evacuated 180,000 people but say there is no radiation. They are certain to have readings but we are being told nothing." He said a radiation release was suspected "but at the moment it is impossible to know. It was the same at Chernobyl, where they said there was a bit of a problem and only later did the full extent emerge."

    According to some reports, 17 helicopter crewmen helping in rescue efforts were contaminated with low-level radiation, but Japanese officials declined to comment.

    The country's government has previously been accused of covering up nuclear accidents and hampering the development of alternative energy.

    In a newly released diplomatic cable obtained by WikiLeaks, politician Taro Kono, a high-profile member of Japan's lower house, tells US diplomats that the Ministry of Economy, Trade and Industry – the Japanese government department responsible for nuclear energy – has been "covering up nuclear accidents and obscuring the true costs and problems associated with the nuclear industry".

    In 2008, Kono told them: "The ministries were trapped in their policies, as officials inherited policies from people more senior to them, which they could then not challenge." He mentioned the dangers of natural disasters in the context of nuclear waste disposal, citing Japan's "extensive seismic activity, and abundant groundwater, and [he] questioned if there really was a safe place to store nuclear waste in the 'land of volcanoes'."

    "What we are seeing follows a clear pattern of secrecy and denial," said Paul Dorfman, co-secretary to the Committee Examining Radiation Risks from Internal Emitters, a UK government advisory committee disbanded in 2004.

    "The Japanese government has always tended to underplay accidents. At the moment the Japanese claims of safety are not to be believed by anyone. The health effects of what has happened so far are imponderable. The reality is we just do not know. There is profound uncertainty about the impact of the accident."

    The Japanese authorities and nuclear companies have been implicated in a series of cover-ups. In 1995, reports of a sodium leak and fire at Japan's Monju fast breeder reactor were suppressed and employees were gagged. In 2002, the chairman and four executives of Tepco, the company which owns the stricken Fukushima plant, resigned after reports that safety records were falsified.

How to Get Gaddafi

How to Get Gaddafi

Mr. President, don’t send guns to the Libyans. Send them a piece of paper.

President Gerald Ford signs the Final Act document in Helsinki in 1975. Bettmann-Corbis

President Gerald Ford signs the Final Act document in Helsinki in 1975.

President Obama is reluctant to intervene in the bloody civil war now underway in Libya. As a senior aide told The New York Times last week, “He keeps reminding us that the best revolutions are completely organic.” I like that notion of organic revolutions—guaranteed no foreign additives, exclusive to Whole Foods. I like it because, like so much about this administration, it is both trendy and ignorant.

Was the American Revolution “completely organic”? Funny, I could have sworn those were French ships off Yorktown. What about Britain’s Glorious Revolution, the one that established parliamentary rule? Strange, I had this crazy idea that William III was a Dutchman.

Alex Majoli / Magnum for Newsweek

Photos: Libya at War

Libya at War: Clashes from Benghazi to Ras Lanuf

The reality is that very few revolutions, good or bad, succeed without some foreign assistance. Lenin had German money; Mao had Soviet arms. Revolutions that don’t get some help from outside aren’t so much inorganic as unsuccessful. Indeed, they generally don’t go down in history as revolutions at all. More than one revolt has been brutally crushed by an Arab dictator—think of the Marsh Arabs’ fate at the hands of Saddam Hussein. Such events tend to be remembered as massacres. We must hope that someone gives President Obama a history lesson before thousands of Libyans share their fate. It will be tragic indeed if America concludes from the experience of overthrowing murderous tyrannies in Afghanistan and Iraq that the correct policy is to turn a blind eye to murder in Libya. That, remember, was the policy pursued by the last Democrat to occupy the White House, in Rwanda as well as, for much too long, in Bosnia.

Yet it would also be an erroneous conclusion that the only form of assistance America can give to good revolutions is military. A no-fly zone was not, after all, what helped the Central and Eastern European revolutionaries of 1989 topple their tyrants. The assistance we gave them was not military. It was moral.

One of the many unsung achievements of President Gerald Ford, the Helsinki Final Act of 1975, was history’s biggest-ever poison pill. The document was the result of two years of haggling at the Conference on Security and Cooperation in Europe, originally a Soviet initiative to deal with security issues, but one that veered unexpectedly to address issues of human rights.

Eight of the 35 countries that signed the Final Act were communist. Yet it contained the following startling words:

The participating States will respect human rights and fundamental freedoms, including the freedom of thought, conscience, religion or belief, for all without distinction as to race, sex, language or religion … The participating States will respect the equal rights of peoples and their right to self-determination.

So accustomed were the Soviet authorities to lying that they saw no harm in subscribing to these pledges. Indeed, the Final Act was reprinted in full in Pravda. But for dissidents inside the Soviet bloc like the physicist Andrei Sakharov or the Czech playwright Václav Havel, Helsinki represented a huge stick with which to beat their persecutors.

The Cold War ended not because the United States achieved a military edge over the Soviet Union, but because the legitimacy of the Soviet system collapsed from within. Our role was to insist on the importance of those “human rights and fundamental freedoms.” Even if not all our allies in the Cold War always upheld them, the other side respected them less.

Why have we failed to learn from that success? Why have we allowed a mockery to be made of the United Nations Human Rights Council, which numbered Libya among its members until just the other day and still includes Saudi Arabia, not to mention China and Cuba?

Memo to the president: organic revolutions, just like your Whole Foods arugula, need sunlight and watering. It’s time for a new Helsinki, aimed at discrediting all of today’s unfree states, starting with the four I’ve just named.

America Needs Straight Talk

America Needs Straight Talk, Not Pampering

The Obama administration figures that it has read the national mood well. This therapeutic generation of Americans loves to talk and worry about problems and then assumes that either someone else will solve them or they will go away on their own.

And why not, since we have had periodic "energy crises" since 1974, have run budget deficits in most years since World War II, and have been warned about a looming Social Security meltdown for the last decade — and yet remain wealthy and affluent.

But now gasoline costs more than $4 a gallon in many places in California, and averages more than $3.50 nationwide. In response, the Obama administration is reportedly considering tapping into the nation's Strategic Petroleum Reserve to increase supplies and drive down high prices brought on by a recovering world economy and unrest in the oil-rich Middle East.

Yet the reserve depot was not designed to alleviate periodic gas-price spikes, but to ensure our very survival during a global catastrophe that might result in a cutoff of most petroleum imports from overseas.

There are now more than 700 million barrels of stored oil in the reserve. In times of near-Armageddon, even that huge supply would provide for all of the nation's oil needs for only a single month. It would make up for all imported oil cutoffs for only two months.

Wrong To Drill

So how is it wise to tap this critical but finite reserve — especially when the current administration had prohibited new oil and gas production in large parts of the Gulf of Mexico and the western United States? The administration certainly will not reconsider new drilling in oil-rich areas in Alaska or elsewhere off the American coasts.

The message to Americans seems to be that it is OK to consume old oil stockpiled by previous generations (the reserve was begun in 1975), but quite wrong to drill for new oil to be used by the present generation.

This same self-centered approach characterizes the federal budget. The Obama administration appointed a national debt commission — only to ignore so far its recommendations because they're seen as too painful.

But note that the commission did not call for a balanced budget for years to come. It suggested that only after 26 more years of massive federal borrowing would we be able to ensure at last Social Security's long-term financial health.

The president often expresses concern over the escalating debt, but then he increased annual borrowing this year, leading to a record $1.6 trillion annual deficit. He senses that Americans can neither sustain the present borrowing nor endure the necessary cuts in federal spending, so in response, the mere promise of future frugality seems to excuse even greater present profligacy.

Looking For Truman

There are two constant refrains about the Social Security crisis. One, we are lectured that payouts have already exceeded revenue. Two, we are promised that only future generations, currently far from retirement age, will have to work longer and get less to ensure that the system is solvent.

But if all that math is true, why wait to act? If Americans assume that our children and grandchildren may well have it worse than the baby boomers, then why not rework existing retirement plans right now, either by freezing cost-of-living raises or increasing the retirement age?

Otherwise, we send the message that a more affluent generation can demand that a less affluent generation should make all the sacrifices.

It might seem ecologically noble to divert federal irrigation water from hundreds of thousands of acres of California agricultural land to ensure year-round flowing rivers and the health of small fish species. And if we do not wish to drill for more petroleum, then subsidizing the diversion of Midwestern silage land to ethanol production would likewise seem to make sense.

But at some point, someone is going to have to tell the people that the less land you produce food on, the less food you have, and the more you pay for what is available. In a time of spiraling food prices, that honest message has rarely been delivered.

The United States needs some Harry Truman-like plain speaking, instead of each administration putting off a national reckoning onto the next. Don't drill for oil and grow food — and the price for both goes up. Spend what you don't have, and later you will have to pay even more back.

The generation that ran up the debt and was largely responsible for the Social Security crisis has a responsibility to make things right on its watch.

Such blunt talk is considered political suicide for candidates; in fact, anything less for the rest of us is national suicide.

Averting the Washington Monument ploy

RAHN: Averting the Washington Monument ploy

By Richard W. Rahn

If your accountant told your family that you are spending 40 percent more than you are earning and that your borrowing limits have been reached, how would you cut your expenditures? Would you stop buying food and not pay your mortgage and utilities, or would you first cut out entertainment, such as movies, sports events, cultural performances, nice restaurants and vacation trips? Rational people would do the latter, but government bureaucrats often do the equivalent of the former. This is known as the Washington Monument Ploy, which got its name when a national parks director shut down the Washington Monument and Grand Canyon for two weeks in 1969 to protest budget cuts, rather than cutting administrative costs, deferring maintenance and curtailing new projects.

When faced with a need to cut budgets, the Washington Monument Ploy - or stunt - is the political tactic of shutting down the most visible, popular and/or valuable government service while leaving less important and less appreciated government activities untouched. This is designed to pressure legislators to appropriate more funds for the more popular government service.

Many businesses find that over the years they have allowed some fat to grow in their operations. During recessions or periods of increased competitive pressure, businesses realize they must cut costs drastically in order to remain profitable and survive. Firms like IBM and Ford have done this in recent years, and now both are in fine shape. The process of getting rid of non-essential activities is painful but the alternative is far worse.

All bureaucracies have a tendency to grow fat and lazy over time, whether they are in businesses, nonprofit hospitals, associations, charitable foundations or governments. Other than in government, all other entities normally go through periods of cost-cutting and renewal. Government should not be exempt. Some state and local governments are now suffering through painful, but necessary, cost reductions because they must comply with balanced-budget requirements and they have reached their limits on increasing taxes or borrowing.

Only the federal government can go on without facing normal economic constraints because it prints its own money. However, Congress could require every government agency to rank its programs from the most to the least cost-effective, and present a detailed plan as to how each agency would deal with a required 10, 20 or even 40 percent budget reduction, just as businesses often have to do.

To bring the federal budget into balance this year would require spending cuts of approximately 40 percent. No one has proposed cuts of that magnitude at the moment - Republicans are proposing cuts of about 1.8 percent of this year’s budget and Democrats are only proposing cuts of 0.28 percent. If Congress and the administration fail to agree on a budget or debt-limit increase, government tax revenues would only cover about 40 percent of spending, so a ranking of spending priorities would be necessary.

The Republicans are now being criticized in the media for some of their proposed budget cuts. We have all been exposed to the heart-tugging stories of how small children will go without adequate food if the budget is cut. Everyone who has ever worked for or interacted with government knows there is tremendous waste and inefficiencies and that there are programs that just don’t need to be funded, such as National Public Radio, the Organization for Economic Co-operation and Development, and ethanol subsidies. I often speak before groups of government executives, and when I ask them, “If you were forced to substantially reduce your budgets without impairing the effectiveness of your operation and mission, could you do so - if you were freed from unnecessary paperwork and other absurd requirements?” The answer is almost always “yes,” including those in the military.

Rather than taking all of the heat, the members of Congress should do what boards of directors in companies and other organizations do and that is to require management to come up with specific - and very substantial - budget cuts that would not impair the core functions of the organization. Specifically, they should require each government department to state specifically how it would reduce its budget (by some specified amount) in the most cost-effective way, and be prepared to defend it before the appropriate congressional committees. In addition, the government departments should be required to rank the importance of their activities on the Internet and state how they would reduce the budget (if required to)so members of the media and the public could comment on their rankings. Even the managers of Social Security, Medicare and Medicaid should be forced to come up with proposed reforms to their programs to meet the budget constraints.

Congress could enforce compliance with this requirement by denying the right of any department to spend monies, after a specified date, until each department has submitted an acceptable budget-cutting plan to Congress. The bureaucrats would hate it, but the American people would relish it.

Richard W. Rahn is a senior fellow at the Cato Institute and chairman of the Institute for Global Economic Growth.

Global Market Selloff

Japan's Nuclear Risk Rises

Huge Nikkei Selloff over Japan Fears

Battle of Wisconsin

Japan's Nukes

Dow Slides as Japan Fears Send Investors Scrambling

Dow Slides as Japan Fears Send Investors Scrambling

NEW YORK—U.S. stocks plunged as deepening worries over the specter of a nuclear power crisis in Japan and its economic implications sent investors scurrying again for safety.

Stocks and commodities plummeted around the world Tuesday following a more than 10 percent decline in Japan's Nikkei average. Paul Vigna, Dave Kansas and Kristina Peterson have details.

The Dow Jones Industrial Average sank 202 points, or 1.7%, to 11784, while the Standard & Poor's 500-stock index lost 22 points, or 1.7%, to 1274. Stocks had initially tumbled more, with the Dow posting its biggest intraday loss of the year, before slightly paring its slide in late morning trading.

All of the Dow's 30 components were in the red. Shares of General Electric dropped 3.9% to lead the declines, amid concerns about the company's involvement in the design of all six reactors at the Fukushima Daiichi nuclear plant in Japan.

All 10 sectors of the S&P 500 were in negative territory, and only 19 companies within the index were trading higher.

Tech and industrial stocks posted the heaviest losses. Alcoa fell 2.6%, Intel declined 3.6%, Caterpillar shed 2.1% and 3M lost 2.9%.

Insurers were also under pressure as concerns grew about the rising costs in Japan. Aflac fell 9.6%, Hartford Financial shed 6%, MetLife dropped 5.1% and Prudential Financial fell 5.6%.

WSJ's Isabella Steger and Jonathan Casey join the News Hub and report on the global impact of the 11% drop by Japan's Nikkei Index.

The Nasdaq Composite, meanwhile, tumbled 46 points, or 1.7%, to 2655, dipping briefly into negative territory for 2011.

The selloff came after news of two more explosions at Japan's Fukushima Daiichi nuclear-power plant that released large amounts of nuclear material into the atmosphere. Prime Minister Naoto Kan warned of "substantial" radiation leaks. Tokyo also suffered another earthquake of 6.1 magnitude in the late evening.

Investors said the mounting damages and risks from the disasters continued to inject new sources of anxiety into the market.

Japan's Nikkei slumped 11%, dragging regional and global benchmark indexes down, on concerns over the country's radiation levels. WSJ's Jake Lee and Isabella Steger discuss.

"This is a tragedy of immense proportion but we still don't know exactly what the parameters of that are," said Fred Fraenkel, vice chairman of Beacon Trust Company. "It's evolving and getting worse and we don't know where it will end or how it will end," he said. Still, he said, the economic blow to Japan should not derail long-term growth in other countries.

"Even in a worst case, dire scenario, which would be horrible for Japan, it probably would not abort the worldwide recovery," he said.

In Japan, the Nikkei Stock Average plunged more than 14% at its lows on Tuesday, setting off circuit breakers at the Osaka Securities Exchange to halt trading. The index closed down 11% in its biggest one-day percentage loss since the Oct. 16, 2008 during the aftermath of the global financial crisis.

The tumble sparked broad declines in Asian and European markets. Germany's DAX 30 index was particularly hard hit, dropping 3.9% in intraday trading. The Japanese selloff hurt sentiment across Asia, where Hong Kong's Hang Seng index closed down 2.6% and South Korea's Kospi fell 2.4%.

[0315trader] European Pressphoto Agency

Markets around the world are reacting to the aftermath of the earthquake and tsunami in Japan.

In the commodity markets, crude-oil prices tumbled to below $99 a barrel. Gold dropped to $1393 an ounce.

In U.S. economic news, New York manufacturing activity continued to expand in March, with more businesses raising prices in the face of higher costs, with a survey of business conditions handily beating expectations. The index for employment also jumped to a reading of 9.09 from 3.61 in February. But profit margins remained under intense pressure.

U.S. import prices also rose more than expected in February as costs increased for energy, industrial supplies and food. The price of goods imported to the U.S. climbed by 1.4% from the month before, the Labor Department said, topping consensus estimates of a 0.9% price increase in February.

Investors were also awaiting the outcome of a monetary-policy meeting by the Federal Reserve.

The Japanese Disasters

Quakes, Tsunamis, Meltdowns

The Japanese Disasters

By GARY LEUPP

It’s nicknamed Mori no miyako, “the forested capital.” Or maybe we could render it – Sendai -- the “Kyoto of the woods.” The castle of Lord Date Masamune, built in the 1600s, is called the Aoba-jo or “Green Leaves Castle” and the main street of the castle-town is called Green Leaves Avenue. When I visited for a week in 1986---a visit prolonged since typhoons were preventing rail travel---I was struck by the green so lacking in most Japanese cities, watered by the Hirose River. I fell in love with it, comparing it in some respects to Sapporo where I’d met my wife.

I will always associate, as do many Japanese, Sendai with the song Aobajo koi uta,a plaintive ballad that begins with this verse so representative of Japanese art, which always finds poignant beauty in the transience of life:

“Hirosegawa nagareru kishibe

Omoide wa kaerazu
Hayase odoru hikari ni
Yureteita kimi no hitomi
Toki wa meguri
Mata natsu ga kite
Ano hi to onaji nagare no kishi
Seoto yukashiki
Mori no miyako
Ano hito wa mo inai”

“On the bank of the flowing Hirose River
I’m remembering what can’t return.
In the dancing brightness of the rapids
I see your eyes brimming with tears.
Time goes around.
Summer comes again.
Just like on that day the rapids between the banks
the delightful sound of the rapids
in this wooded city.
That person no longer exists”

I am wondering if Sendai exists anymore. “Many areas of the town,” according to CNN, “are simply gone -- mud and boards littering an area where a row of homes used to stand; a vehicle upside-down among tree branches. A school, which had 450 people inside when the tsunami hit, stood with its doors blown open and a jumble of furniture -- plus a truck -- in its hallways. Some teachers and students were able to escape the building, but officials said others did not.”

Located just 100 miles west of the epicenter of Friday’s earthquake, Sendai incurred more damage than any other major Japanese city. Its Futaki neighborhood is being referred to as “ground zero” of the disaster. Sendai, in Miyagi Prefecture, is the most populous city in the vast Tohoku or Northeast region. It had a population of a million people before the quake and the tsunami it unleashed. It is thought that the nearby fishing town of Minamisanriku has lost around 10,000 of its 17,000 residents. Kasennuma, also in Miyagi, a city of 74,000, is totally submerged. Whole towns and villages have been sucked out to sea. The official death toll remains relatively low at 10,000, but the number of missing is huge. How many has Sendai lost?

First there was the violent shaking, lasting over three minutes. As it started people must have thought, “Need to turn off the gas stove.” Every schoolchild has been taught that. Next: “Be concerned about a tsunami.”

But there was no time. Within minutes, as houses caught fire, the sea level dropped dramatically only to well up ferociously. The wall of water attacked the city, submerging the treetops, and inundated almost the entire Tohoku Pacific coast. The Sendai airport runway was flooded. City blocks blazed into the night as fire engines remained idle, unable to reach them through the inundated streets. The perfect storm of fire and water, a catastrophe of biblical proportions. A snowstorm made life more miserable for those lacking shelter.

Up the coast police found the bodies of 200-300 persons who’d been dragged out to sea, then returned to shore. This was the big one---not just the biggest in 140 years of scientific record-keeping, but probably in the last 1500 years. And it’s not over yet; aftershocks measuring magnitude 6 or more have been happening every few hours.

I grieve for Japan, where I spent six years, in general. The Friday quake impacted a huge swathe of the country. My mother-in-law in Sapporo, in the northern island of Hokkaido, definitely felt it. She told my wife (who got though to her on the third try since many phone lines are down), that she thought it was just another normal quake. (It was in fact 6.8 magnitude in Sapporo.) She was watching TV at the time and saw that a quake had hit Tokyo, over 500 miles to the south. What a strange coincidence, she thought, that there’d be earthquakes in Sapporo and Tokyo at the same time. She didn’t realize it was all the same quake, which was indeed felt as far away as Beijing.

Like most Japanese my mother-in-law has a very matter-of-fact attitude towards earthquakes. They are shikataganai koto, something that can’t be helped. One just has to deal with them rationally (even while perhaps trying to explain them with reference to the earthquake god Nai no kami, or the legendary giant catfishNamazu, who lives in the mud under the sea and thrashes about wildly when not restrained).

She opines that the quake is divine punishment for Japan for political corruption and factionalism. But the religiosity and fatalism of this 78-year old, very tough woman coexist with great practicality. Her up-to-date pre-fab home is programmed so that when the earth trembles the kitchen cabinets lock automatically so dishes don’t fall out. And the heater shuts down. She has her act together, as do the Japanese people in general when it comes to earthquakes, But this was not a normal one.

I mourn for the whole country but for Sendai specifically---Sendai with its unique dialect I found incomprehensible, Sendai with its exceptionally beautiful women, Sendai with its rich history. The Date samurai elite were for a time friendly to Roman Catholic missions, protecting them even when the central power persecuted Christians. In the 1610s Date Masamune sent emissaries to the Vatican to establish ties; they traveled across the Pacific to Mexico and on across the Atlantic. (In 1617 seven of the samurai mission members decided not to return home but settled in a town near Seville where hundreds of people today hold the surname “Japon.”)

The envoys brought back letters, paintings and maps preserved in the Sendai City Museum. At least I hope they are. And I hope the monument to the great Chinese writer Lu Xun, who studied in the city from 1904 to 1906, has not been damaged.

Japanese know Sendai as the home of Tohoku University, one of the finest public universities in the country. They also know about the city’s Tanabata Festival, held in early August every year. The population swells as what seem to be half the population of Tohoku gather to celebrate the Chinese myth of the love of the Weaving Princess (the star Vega) and the Cow Herder (the star Altair). The princess’s father, a powerful deity presiding over the Milky Way, allowed her to meet and marry the cowherd. But then he became angry when she neglected her silk-weaving duties and let cattle wander into heaven. He separated them, only allowing them to meet once a year, when magpies assist the princess to cross over a heavenly bridge to meet her husband.

The August festival, celebrating this divine liaison, is marked by the display of countless decorations throughout the city, spectacular fireworks displays, dancing and other events. Think of it as a kind of subdued Mardi Gras, and flooded Sendai as New Orleans after the hurricane. Will the festival, celebrating the persistence of love under the most unfavorable circumstances, survive?

My mother-in-law’s opinion notwithstanding, we cannot attribute either divine or human agency to the movements of tectonic plates of the coast of Honshu. This is just---shikataganai---the way things happen on our young vigorous planet. But it may happen that the worst part of this disaster will be man-made. When some human beings who in their quest for profit and prosperity deal with the environment stupidly, we really need to hold them accountable.

One-third of Japan’s energy supply is provided by nuclear reactors. They are located for the most part on the thin strips of coastal land where the great majority of Japanese live, and vulnerable to inevitable cataclysms. When an earthquake or volcanic eruption disrupts the supply of electricity needed to pump the water that keeps the reactor cool, there can be a meltdown and release of lethal doses of radiation. The Chernobyl disaster of 1986 is thought to have produced many thousands of deaths from cancer in addition to 57 immediate deaths from radiation exposure.

What happens if -- as now seems highly likely -- power plants Dai-ichi and Dai-ni, up the coast from Sendai in Fukushima prefecture, experience meltdowns? Do we say shikataganai? Or do we demand the heads of the planners, politicians and corporate bosses who made this happen? For years public opinion polls have shown a plurality of Japanese opposed to nuclear power. A 1999 Asahi Shinbun poll showed 45 per cent of Japanese opposing nuclear energy, with only 32 per cent supporting it. In 1996 half the electorate of Mie Prefecture signed a position opposing the construction of a nuclear plant. But as a study on public opinion and nuclear power in Japan published by Rice University in 2000 noted, a minority argued that nuclear power was the key to Japanese energy independence. “These views allowed officials to discount protests as short-term, selfish economic anxiety. They effectively used financial rewards and compensation to dampen discontent. Little attention was given to the legitimacy of public concerns on safety.”

Despite public opposition, and the occurrence of level 2, 3, and 4 accidents (in 1995, 1997, and 1999 respectively), reliance of nuclear power soared. In 1990, 9 per cent of Japan’s electricity was generated by nuclear plants, while in 2000 the figure was 32 per cent.

In the 1990 film Yume (“Dreams”) by Kurosawa Akira, based upon the great film director’s own dreams, there is a short piece called “Mt. Fuji in Red.” In the nightmare, people are fleeing from an earthquake along a bridge. Several---a woman and her two small children, a man in a suit, and a man dressed casually---pause to stare up at Mt. Fuji, realizing in horror that it is erupting. (This is entirely conceivable. It last erupted in 1707 and has erupted about 75 times in the last 2200 years.) A huge radioactive red cloud appears on the horizon as huge columns of flame envelop the mountain. The uniformed man notes that the mountain is ringed by six atomic plants. They flee, although he declares that because Japan is small there’s no escape.

The scene changes to a deserted debris-strew cliff overlooking the sea. The casually dressed man asks where all the people have gone, and the other man tells him they’ve all leaped into the sea. He then points to the sky and explains: “That red one is plutonium 239. One 100,000,000th of a gram causes cancer. The yellow one is strontium 90. It gets inside you and causes leukemia. The purple one is cesium 137. If affects reproduction and causes mutations. It makes monstrosities. Man’s stupidity is unbelievable. Radioactivity is invisible. But because of its danger they colored it. But that only lets you know what kind kills you. Death’s calling card.”

He bows politely, says “Osaki ni (a phrase literally meaning, “in advance of you”), and turns to the cliff, preparing to leap into the sea. The other man tries to restrain him, noting that radiation doesn’t kill immediately, but is told that “waiting to die isn’t living.”

The woman hugging her children cries out, “They told us that nuclear energy was safe. Human accident is the danger, not the nuclear plant itself. No accidents, no danger. That’s what they told us. What liars! If they’re not hanged for this, I’ll kill them myself!” The man about to leap into the sea tells her that the radiation will kill them for her. He again bows low, and confesses he’s one that deserves to die. He throws himself over the cliff as the radioactive winds surround the living.

Was this nightmare scenario just the bad dream of the great Japanese director? Japanese officials are pooh-poohing the possibility of a major calamity. Chief Cabinet Secretary Edano Yukio “assumes the possibility of a meltdown” at one of the Fukushima reactors. “At the risk of raising further public concern,” he says, “we cannot rule out the possibility of an explosion. If there is an explosion, however, there would be no significant impact on human health.”

Reminds me of the woman in the film: No danger. That’s what they told us. I don’t want to predict the worst, knowing little about nuclear power. But it’s obviously not safe when you have to evacuate 180,000 people as a precaution, when workers have to struggle to avert disasters, and countries are urging their nationals to leave Japan with radiation a principle concern. There is already a significant influence on the mental health of Japanese seized by anxiety about explosions and leaks. As we mourn the dead we should on behalf of the living struggle for safe, sustainable, green energy.

Gary Leupp is Professor of History at Tufts University, and holds a secondary appointment in the Department of Religion. He is the author of Servants, Shophands and Laborers in in the Cities of Tokugawa Japan; Male Colors: The Construction of Homosexuality in Tokugawa Japan; and Interracial Intimacy in Japan: Western Men and Japanese Women, 1543-1900. He is also a contributor to CounterPunch's merciless chronicle of the wars on Iraq, Afghanistan and Yugoslavia, Imperial Crusades. He can be reached at: gleupp@granite.tufts.edu

The State Can Do No Wrong

The State Can Do No Wrong

Mises Daily: by

[This article was first published in the American Mercury in November 1936. An MP3 audio file of this article, narrated by Steven Ng, is available for download.]

Now that the campaign is ending, our citizens are presumably deciding whether to vote for Tweedledee or Tweedledum, and speculating on what is likely to happen to the country if either ticket wins. It was clear from the first that the campaign would boil down to the one old familiar issue, which is whether we shall be blackmailed for the next four years to support a horde of deserving Democrats or a horde of deserving Republicans. This is the only real issue that has existed in American politics since the Civil War, and it is the only one that exists now. Hence those who hold no material stake in this issue may well decide that it is all the same to them which ticket wins or loses, and all the same to the country whether they drop their vote in the ballot box or in the ash barrel.

The reason for this state of things is worth investigating. It lies in the popular idea of the moral character of government. In the old days the idea was that a king got his commission straight from God, and therefore he was exempt from the moral sanctions that were binding upon everybody else. The moral character of his acts was not open to question by anyone. He might do whatever he liked — lie, steal, cheat, commit all sorts of oppressions, mayhems, adulteries, murders — and, as we say, get away with it under the special moral sanction that the king can do no wrong.

We have now pretty generally got rid of kings and substituted a system of parliaments and executives who administer what we call the State; and now the question is, what is the popular idea about the State? Are the parliaments and executives answerable to the moral standards set for other people, or have we the idea that they may do anything they like because they represent the State (or actually are the State for the time being) and can do no wrong?

In one view of this question, the State is a social agency set up by the people to safeguard their freedom and distribute justice. This is the republican view, according to the Declaration of Independence, which says that "to secure these rights, governments are instituted among men," and says further that government derives its just powers, not from God, but from "the consent of the governed." In this view, obviously, the government may not do anything it likes; it is merely an agency with a clearly specified function, a definite job. It is not morally irresponsible; on the contrary, it is answerable to moral judgment, like any other social agency. Having been created by the people, it may not arrogate to itself any exemption from the ethical code of its creator. By consequence, those who administer the government may not do anything they like. There is no margin of permissible misconduct allowed them. They are merely agents, public servants, no more, no less. The president of the United States is precisely what the late Mr. Bryan said he is, "the people's hired man," and in the discharge of his specified duties he is open to judgment by exactly the same standards of integrity that we apply to the conduct of a bank manager or a train dispatcher, a butler or a housemaid.

In another view, however, the State is entirely dissociated from moral considerations. Like the old-time king, it stands alone, outside any ethical code, with no prescribed duty to anyone, and no responsibility but to itself; it is its own judge of its own acts. As Mussolini puts it, "The State embraces everything, and nothing has value outside the State. The State creates right." In this view, whatever the State disallows is wrong, because the State disallows it; and whatever the State allows is right, because the State allows it. There is no other criterion of right and wrong but the approval or disapproval of the State. There is no criterion of justice between man and man except the interest of the State. If what one man does to another affects the State favorably, it is just (even fraud, arson, theft, murder) and if unfavorably, it is unjust.

This is the old absolutist idea, expressed in a new formula, as against the republican idea. It merely transmogrifies the divine right of kings into the divine right of parliaments, executives, dictators. Hegel puts this plainly when he says that "the State incarnates the divine idea upon earth." Its essence is that the people exist to maintain and magnify the State. The republican idea is that the State exists to protect and prosper the people in their rights and liberties. Thus Fascism, Communism, Hitlerism, Stalinism, are all essentially the same thing. Their superficial differences amount to nothing more than catchwords and claptrap.

We have seen the progress of the absolutist idea in Europe, and we have perceived that the significant thing is that whereas formerly only the few who made up the "ruling classes" were penetrated by it, nowadays immense numbers of people are penetrated by it. Hence, as we see in the case of Spain, any disturbance of stability in the public order opens the way for any adventurer to come forward and establish himself by popular acceptance of any and every act of crime that he may commit on the pretext of "assuring the position of the State."

"Fascism, Communism, Hitlerism, Stalinism, are all essentially the same thing. Their superficial differences amount to nothing more than catchwords and claptrap."

Thus after the French Revolution, a man of no name, no tradition, no habits, no character, no convictions, not even a Frenchman, made himself the State; that is, he made himself master of a people thoroughly impregnated with the absolutist idea, and by a course of inconceivable crime set Europe on fire from end to end. Thus again of late in Germany another, not even a German, assembles a horde of fanatics and desperadoes, and by sheer violence makes himself the State; thus in Italy another, a Socialist agitator and journalist, heads a mob of vicious lazzaroni in a march on Rome, and makes himself the State. Thus in Turkey, thus in Poland, thus in Hungary, thus in Portugal, and so on.

From all this we may see that the dangerous thing is not what actually happens here or there, but the general subversion of moral theory with respect to the State, for this subversion permits anything not only to happen but to be approved. Loose talk about "it can't happen here" is crudely superficial. Given a people thoroughly penetrated with the idea that the State may do anything it likes and can do no wrong, and anything inimical to the interest of the people can happen anywhere. It may not take place by force of arms, nor be attended by bloodshed and rapine; it may take place by normal and familiar processes of political chicane. In this country, for example, the most exorbitant confiscations of public interest to "assure the position of the State" have lately been effected in this way. The danger is never in the overt acts, for they can be got over; it is in the ethical estimate of such acts as right and just.

As with the State, so with the political party. In the struggle to get control of the State's machinery, the most flagitious misdemeanors are divested of any moral character in the estimation of the public, on the ground that the party shares the moral exemptions accorded the State. Mendacity, duplicity, breach of trust, diversion of public money to party purposes are accepted as acts having no moral quality. Moreover, as with the party, so with the candidate. The general view of the State as an amoral entity inevitably and powerfully stimulates the ambition of the type of person who is best qualified, and also most eagerly disposed, to profit by it and presume upon it to the utmost. His party platform, his campaign promises, his pre-election agreements, his declarations of political principle, his expressions of deep solicitude, are accepted as a kind of ritual — really, as so many signboards reading, "Do not trust me," and their prompt repudiation, when it comes, is not reprehended on moral grounds.

Finally as with the State, the party, and the candidate, so also with the elected incumbent. His election qualifies him as a chartered libertine; his certificate of election is a letter of marque-and-reprisal, exempting him from all moral considerations in "assuring the position of the State" — that is, in assuring his own continuance and that of his party in control of the State's machinery. To promote this purpose he may do anything he likes without incurring any risk of collision with the public's moral sense; in certain circumstances, even, he may be assured of the most enthusiastic popular acclaim for acts which if committed in a private capacity would mark him forever as a knave and a dog. The only consideration he need take into account is "what the traffic will bear."

And here we come in sight of the question raised at the beginning of this paper. Whichever party wins, whichever candidate is elected, their measures will be taken, not for maintaining the liberties and security of the people, but for "assuring the position of the State" — that is to say, their own position — by every means consistent with what the traffic will bear; and the traffic will bear as much and no more from one party than from another, as much and no more from Mr. Roosevelt than from Mr. Landon, Mr. Thomas, Mr. Lemke, or Mr. Browder.

Four years ago the psychological condition of the country, the condition of disgraceful funk that took possession of the citizens, was so demoralizing that the traffic would bear an unprecedented amount; and the most conspicuous lesson of that election was furnished by the alacrity displayed in what James Madison contemptuously called "the old trick of turning every contingency into a resource for accumulating force in the government." Mr. Roosevelt and his associates lost no time about "assuring the position of the State" with immense energy and by egregiously immoral means, quite as their opponents would have done in their place; the difference in results, if any, would have been a difference due only to superior ability and skill in managing those means.

At present, the contingency is not so pressing, the people are not in a funk, and the traffic will not bear so much; but all the parties and candidates are quite alive to what it will bear, and whichever party wins the election may be confidently expected to conduct itself accordingly.

Therefore, the sum of the whole matter is that if and when the people of this country drop the neomedieval conception of the State as an institution completely dissociated from morality, and adopt the republican conception expressed in the Declaration, the thoughtful and intelligent citizen may reasonably be expected to interest himself in the course of the nation's politics; but until then he may reasonably be expected to do nothing of the kind.

Radiation Rising and Heading South in Japan

Red Alert: Radiation Rising and Heading South in Japan

The nuclear reactor situation in Japan has deteriorated significantly. Two more explosions occurred at the Fukushima Daiichi nuclear power plant on March 15.

The first occurred at 6:10 a.m. local time at reactor No. 2, which had seen nuclear fuel rods exposed for several hours after dropping water levels due to mishaps in the emergency cooling efforts. Within three hours the amount of radiation at the plant rose to 163 times the previously recorded level, according to Japan’s Nuclear and Industrial Safety Agency.

Elsewhere, radiation levels were said to have reached 400 times the “annual legal limit” at reactor No. 3. Authorities differed on whether the reactor pressure vessel at reactor No. 2 was damaged after the explosion, but said the reactor’s pressure-suppression system may have been damaged possibly allowing a radiation leak. After this, a fire erupted at reactor No. 4 and was subsequently extinguished, according to Kyodo. Kyodo also reported the government has ordered a no-fly zone 30 kilometers around the reactor, and Prime Minister Naoto Kan has expanded to 30 kilometers the range within which citizens should remain indoors and warned that further leaks are possible.

Reports from Japanese media currently tell of rising radiation levels in the areas south and southwest of the troubled plant due to a change in wind direction toward the southwest. Ibaraki prefecture, immediately south of Fukushima, was reported to have higher than normal levels. Chiba prefecture, to the east of Tokyo and connected to the metropolitan area, saw levels reportedly two to four times above the “normal” level. Utsunomiya, Tochigi prefecture, north of Tokyo, reported radiation at 33 times the normal level measured there. Kanagawa prefecture, south of Tokyo, reported radiation at up to nine times the normal level. Finally, a higher than normal amount was reported in Tokyo. The government says radiation levels have reached levels hazardous to human health. Wind direction, temperature, and topography all play a crucial factor in the spread of radioactive materials as well as their diffusion, and wind direction is not easily predictable and constantly shifting, with reports saying it could shift west and then back eastward to sea within the next day. It is impossible to know how reliable these preliminary readings are but they suggest a dramatic worsening as well as a wider spread than at any time since the emergency began.

The Japanese government has announced a 30-kilometer no-fly zone and is expanding evacuation zones and urging the public within a wider area to remain indoors. The situation at the nuclear facility is uncertain, but clearly deteriorating. Currently, the radiation levels do not appear immediately life-threatening outside the 20-kilometer evacuation zone. But if there is a steady northerly wind, the potential for larger-scale evacuations of more populated areas may become a reality. This would present major challenges to the Japanese government. Further, the potential for panic-induced individual evacuations could trigger even greater problems for the government to manage.

Can the colonel be stopped?

The crisis in Libya

Can the colonel be stopped?

by X.S. | CAIRO

CALLS for a no-fly zone over Libya are becoming much stronger, now that the Arab League has "unanimously" backed the idea (though in reality Algeria, Sudan and Syria, all repressive and undemocratic regimes, were unhappy about it). At an earlier meeting last week, the six-country Gulf Co-operation Council (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates) was even keener to get rid of Colonel Muammar Qaddafi, who has insulted a number of its rulers over the years.

Though the African Union elected Colonel Qaddafi its year-long chairman in 2009, it will probably blow with the wind.

Once these bodies have all thrown their weight behind the idea, enough "cover" should have been given to Western governments, in particular the United States, to let them persuade the 15-member UN Security Council to pass a resolution putting the idea rapidly into effect. The Americans were at first plainly warier than Britain and France, after their difficulties in Iraq and Afghanistan.

Brazil and India were initially hostile to the idea, but will probably follow the Arab League's example. China may abstain, but Russia is likely to take most persuading. The American vice-president, Joe Biden, has been in Moscow to discuss a "reset" in relations between the two cold-war adversaries. A bargain may be struck.

If the Security Council does pass a no-fly resolution, it will probably be for NATO to enforce the policy, using bases in southern Italy and the British sovereign base at Akrotiri in Cyprus. Aircraft-carriers would not be essential.

Among NATO governments, Turkey was initially hostile to a no-fly-zone proposal. If it sticks to this view, it would be difficult for NATO to participate as an organisation, in which case a coalition of the willing could be formed, provided the Arab countries were strongly on-side. At a public forum in Qatar on March 13th, the Turkish foreign minister, Ahmet Davotoglu, studiously avoided specifically mentioning Libya. But Turkey might swing behind the idea if Arab countries in the region press it to do so.

It is debateable whether a no-fly zone would require a sustained campaign to bomb Colonel Qaddafi’s airfields and assets at the outset. It could be that his most dangerous defensive weapons, surface-to-air missiles, of which he is said to have a large and modern arsenal, would have to be knocked out by NATO (mainly American) missiles. Robert Gates, the American defence secretary, has sounded reluctant to authorise such operations. But other American generals have been more sanguine. Some say it would not be necessary to launch a bombing attack at all; the Libyan colonel would know it would be suicidal to send his aircraft into the air, once the UN resolution were passed.

Those who argue against the no-fly zone point out that so far the civil war has been entirely conducted on the ground and that the no-fly zone would make little difference. This is not quite true. The colonel has bombed assets such as oil refineries under the rebels' control. It is unclear whether his other key weapon, Russian helicopter gunships, would be forbidden to fly as well as his fixed-wing aircraft. There is no reason why this should not be made clear.

Moreover, the rebels would receive a big psychological fillip if they knew they and the buildings and assets under their control were safe from air attack.

The real key to the rebels' success would be the co-operation of the new Egyptian government, which is still tied closely to the Egyptian armed forces, which in turn may be understandably keen to conduct themselves modestly during the transition to democracy. But Amr Moussa, the Egyptian former foreign minister who heads the Arab League and has declared himself a candidate for the Egyptian presidency, is outspokenly keen to enforce a no-fly zone—and to topple the Libyan dictator.

Indeed, Colonel Qaddafi incurs hostility across the Arab world. He has few friends anywhere, except among some of the African dictators who have survived partly because of his largesse, sometimes in the guise of free oil. Hugo Chavez is also likely to stick up for him, and may even offer him a safe haven, should the colonel decide not to go down in flames at home.

The fight continues

Turmoil in Libya

The fight continues

by S.N. | BENGHAZI

MORALE was running high among rebels in Benghazi on Monday. Reports had come in the previous evening that anti-Qaddafi commandos had scored a surprise victory in the oil town of Brega. The rebels said their forces had staged a feigned retreat from the town before sneaking back in and taking the advancing regime forces by surprise. There was no way to verify their version of events: journalists were blocked from going to the front yesterday. Both sides have claimed control of the town in recent days and fierce fighting continues. But if the rebels are right, it would be a major setback for the regime's forces which had seemed to be relentlessly grinding forward using heavy artillery and air bombardment.

Most Benghazi residents appeared to believe the reports of rebel success. The unofficial capital of eastern Libyan is about 230km from the frontline, which has shifted between pipeline terminals in the Gulf of Sirte to the southeast. But they chat regularly on their mobiles with fighters at the front. They are mostly spirited but untrained youths but they have now apparently been stiffened by "commando" units of military veterans organised by colonels who defected from the army. One driver said that if the West were to ground Colonel Qaddafi's air force with a no-fly zone, the rebel army could be "in Tripoli in two days." People in Benghazi say that the rebels have no fear of tanks and artillery, which they can fight with rocket-propelled grenades and other weapons, and can hold their own in street fighting. They are, however, terrified of aircraft circling overhead against which they have little chance, particularly out on the open desert roads. Ajdabiya, the rebels' forward military headquarters, was bombed on Monday, though it seems to little effect. Fighting was also reported in the isolated eastern town of Zuwara.

Meanwhile the interim council which now runs affairs in Benghazi appears to be doing an admirable job of keeping the lights on and the shops full. But trench-digging or any other preparations to defend the eastern capital should Ajdabiya fall conspicuously absence, and police and revolutionary militiamen are thin on the ground. Although rebel spokesmen claim to have warned known Qaddafi partisans to stay in their houses, some are clearly not deterred. As your correspondent drove by a central Benghazi sidestreet, there was a scuffle, followed by a gunshot, and a wounded youth was loaded into an ambulance. Residents said that a Qaddafist, probably a neighbour, had shot dead a fighter who had just returned from the front, then fled. An hour later he came back and shot in the leg a man whom witnesses say was the fighter's brother. A third brother looked scornfully at the militiamen who rushed in to assess the situation. "They call this a revolution? Everyone has guns and there is no control," he said. But a minute later he directed his anger elsewhere, vowing to take revenge on the killer and the dictator who sent him.

The threat made real

Radiation leak

The threat made real

by H.T. and A.T. | TOKYO and HONG KONG

AT AN 11am news conference this morning in Tokyo, Naoto Kan, Japan’s prime minister, announced that elevated levels of nuclear radiation emanating from the Fukushima power plant pose a substantial risk to human life in the area. He urged people within 30 kilometres of the site to stay indoors.

Early Tuesday morning an explosion damaged the No. 2 reactor at the Daiichi plant in Fukushima; this is at least the fourth time that an explosion has affected some part of the multi-reactor plant since the a 9.0-magnitude earthquake and tsunami struck on Friday afternoon. This time part of the reactor itself seems to have been damaged. Crew that were tending to the facility and trying to make repairs were evacuated. They had already punched a hole into the vessel around the second reactor, so as to reduce the risk of further hydrogen explosions—at the cost of releasing a greater flow of radioactive particles into the surrounding atmosphere.

The No. 2 reactor is not the only source of concern. A fire broke out at Daiichi’s No. 4 reactor at about 6 o'clock this morning, about half an hour before the blast discussed by Mr Kan. The radiation level around that reactor too is high and rising. Yukio Edano, the chief cabinet secretary, says that the No. 4 reactor was not in operation when the fire started. That suggests that meltdown itself is not a possibility in that reactor, but there is nuclear fuel housed inside. Engineers suspect the explosion was a hydrogen-powered blast, like the ones that preceded it. If that is the case, the nuclear fuel should not be ignited. With the building's shielding ruptured however, some degree of radiation leakage was inevitable.

The radiation level around the No. 3 reactor meanwhile has risen to 400 millisieverts (mSv): much higher than it had been when last reported and positively damaging to human health. Exposure to anything higher than 500 mSv, for however short a period, is recognised as being harmful.

This nuclear accident is already the world's worst since the explosions and meltdown at Chernobyl, in Soviet Ukraine, in 1986. As it escalates rapidly, attention is swinging from the victims and survivors of the catastrophic tsunami damage along the coast to the horrifying possibility of yet greater dangers posed by the compromised reactors. Untold thousands of people in northern Japan have died since Friday. Today panicky e-mails about radiation cascade across East Asia, offering fear and bogus medical advice.

The French embassy put out a safety alert to its nationals living in Tokyo, noting that north-easterly winds from the area around Fukushima could bring low-level radioactive contamination to the capital, 250km away, within 10 hours. While the Japanese response has been by and large stoical, foreigners are clearly giving thought to flight. Air China has cancelled scheduled flights to Tokyo from Beijing and Shanghai.

Mr Kan and his colleagues are trying to reassure the public that the fight to contain the radiation is still on. Their approach has seemed marked by composure and candour. Mr Kan complained that he had not received information directly from the Tokyo Electric Power Company (Tepco) for more than one hour after he watched this morning's explosion on live television. Tepco has requested help at Fukushima from the American army.

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