For several weeks, radioactive leaks from the Fukushima nuclear power plants have been incapacitating a large part of Japan. Information from the Japanese government and TEPCO, the power company that operates the site, has been sparse, often incomplete and sometimes contradictory. A confidential assessment by the Nuclear Regulatory Commission obtained by The New York Times suggests that the damaged Fukushima Daiichi plant is far from stable. The report concludes that the Fukushima plant is facing a wide array of fresh threats that could persist indefinitely.
The Fukushima disaster has become more than a local, regional or national Japanese event. The worldwide implications of the event are becoming apparent: though a major leak in a maintenance pit of the plant has been plugged, there is still a great likelihood that significant amounts of radioactive water will continue to be released into the Pacific Ocean; the worldwide Just-In-Time manufacturing cycle has been interrupted; and increased levels of radiation have been detected on the U.S. East Coast. Though the amount of radiation to reach the U.S. is small and poses no present danger, its presence demonstrates that the Fukushima event has global impact.
Circumstances are still evolving too fast and too out-of-control for the consequences to be fully appreciated in real time. Every day brings new revelations of failure and growing frustration in Japan and elsewhere. It has become obvious that not all the facts about the Fukushima tragedy will be known until the danger is long past.
In Japan, there continues to be uncertainty about the extent of the danger from radiation exposure and lack of information about how many people have already been exposed to health-impairing radiation. We don't know how much contamination has leaked into surrounding land and water or when and how those leaks can be repaired.
The Japanese government announced an evacuation zone extending 19 miles from the crippled Fukushima plants, the same distance as the exclusion zone around Chernobyl in Ukraine. But Japan is neither as large or as sparsely populated as Ukraine. Close to 73 percent of Japan is unsuitable for agricultural, industrial, or residential use. Millions of people could be dislocated in addition to those already homeless because of the quake. These people will need to be relocated and new homes will have to be created for them.
With the international challenge of wars in Iraq, Afghanistan and Libya, and national concerns about Congress being unable to agree on Federal Government funding, the U.S. news spotlight that was on Fukushima has been pointed elsewhere. However, smart investors and social observers continue to monitor the responses to the Fukushima tragedy and gauge its potential impact on world markets.
It will take the equivalent of billions of dollars for the Japanese to recover from these disasters and the U.S. economy is closely linked to theirs. The Japanese government and Japanese investors comprise the second largest holders of U.S. Treasuries, at $885 billion. The Bank of Japan also is reported to hold $493 billion in its reserve balance to avert credit problems. Some financial observers have speculated that the earthquake and tsunami may force Japan's government and investors to liquidate much of the U.S. debt they hold. This possibility doesn't even consider that there is no transparency as to what plans exist for using these funds.