Costs, Human Tolls

Everytime I refresh my browser window, the death toll from the tsunami grows by a couple of thousand. The New York Times reports that at least a third of the dead are children. Even as we mourn, it is easy to detach ourselves from the reality of a number as large as 44,000. It is hard to imagine, and mourn individually, each life lost in such a short span of time. That this number could have been lower if detection systems had been in place for the impoverished countries affected by the tsunami, is shameful. As I mentioned in yesterday’s comments section of Justin’s blog on the tsunami, such warning systems have been made available for the U.S. Canada, Japan and even parts of South America. No such early warning systems existed for the countries and regions in the Indian Ocean, which sits atop a particularly volatile area of the sea floor.

It is a cruel irony that just about two months ago, the National Oceanic and Atmospheric Administration of the U.S. won great merit from the U.S. Department of Commerce for a tsunami detection system is had devised. The detection system, according to the scientists involved in the project, could be developed and implemented for a cost of about $10 million.

So as nations and organizations from around the world rush money to the areas ravaged by Sunday’s tsunami – I can’t help but think of the $10 million that was needed months ago to prevent possibly thousands of the deaths that occurred on Sunday.

While information about the costs and history behind the implementation of detection systems is proving hard to handily come by, there is plenty of information about the costs and benefits of this grave natural disaster on business and industry…

The year 2004 was an expensive one for the global property-casualty insurance industry. According to Swiss RE , the world’s largest insurer, before Sunday’s tsunami, natural and man-made catastrophes caused $105 billion in economic losses worldwide in 2004. So it is with disgust I report that the insurance industry breathed a sigh of relief and said that the massive loss of life and damage over the weekend won’t affect the industry too much. The countries affected by the tsunami were too poor to afford insurance, so the people and the governments of these countries will have to foot the bill for reconstruction and relief on their own. (Most of the aid being given now is rightly for humanitarian needs, not infrastructure). Yesterday, the share prices of insurers remained steady and in some cases inched up slightly as investors reacted to the news. Such is the industry, I know, but there is something very sadistic about it all.

And I don’t know what to make of this next bit of news. A small company named Taylor Devices saw its stock price skyrocket 172% on Monday in reaction to the tsunami. The company makes earthquake protection equipment and it says that everytime a natural disaster occurs, its stock price goes up as investors anticipate increased demand for its products. However, the 49-year-old company hasn’t seen steady increases in demand. In fact, revenue over the last several years has remained largely the same despite all the natural disasters that have occurred, meaning more governments, organizations or companies are not actually buying more earthquake protection equipment. Instead, speculative investors are just making a quick buck off of human loss and suffering.

But this is all unimportant, relatively speaking. What is important is that anyone who is in a position to do so, must help those affected. Many charities are accepting donations, and many immigrant organizations are accepting clothes to send overseas. As Justin said, any leads on how to help are much-appreciated.