Wharton has a fascinating if oddly clinical (they are a business school, after all) look at the logistics and economics of disaster relief, the long-term developmental needs of the areas hit, and aspects of disaster planning.
Though highly informative throughout, the most compelling portion of the article is an account of the tsunami experience in Thailand of Wharton professor Jean LeMaire:
- LeMaire came to Thailand last month to lead a seminar on insurance in Bangkok. Before the seminar even began, he would witness, from the uncomfortably close vantage point of a beach in Phuket, the kind of disaster that haunts insurers and humanitarian relief agencies for months to come — the devastating Asian tsunami that is estimated to have killed more than 170,000 in 11 countries.
The scale of the tragedy and the outpouring of concern from around the world have raised the tsunami to a new level of natural disaster, according to LeMaire, who teaches insurance and actuarial science. “There have been earthquakes with more deaths and more costly property damage, but this is the first truly global tragedy, with TV sets everywhere showing the same images, with people from so many countries among the casualties” and with the widespread availability of e-mail to update the news.
On Dec. 26, LeMaire was making a final check of his equipment before setting out on a morning diving trip. Suddenly, the sea receded for what seemed like half a mile. LeMaire had felt an earthquake earlier that morning, but he had no idea what was coming. The German owner of the boat screamed: “Run. Run. Run away from the beach. A tidal wave is coming.”
LeMaire and three other tourists in the diving group ran 200 yards inland and watched the first wave slam into beachfront restaurants and sink the boat they were to have boarded just minutes later. LeMaire climbed on a table and snapped some pictures. That’s when he saw a second — even bigger — wave coming. He and the others then ran another half-mile inland, barely outpacing the mounting wall of water. LeMaire spent much of the rest of the day listening to radio reports in the homes of Thai hotel workers who took in the stranded tourists. Later he returned to his hotel to gather his belongings, which were undamaged in a second-floor room. He was on the first flight out of Phuket to Bangkok that afternoon.
The Asian tsunami is what insurers dread most: a low-frequency, high-consequence event that inflicts costly damage with very little way to predict where and when it will hit.
The insurance industry was not having a good year to begin with, following four hurricanes in Florida, says LeMaire. However, since the insurance market is not as well developed in the region impacted by the deadly waves, and because property values are lower, the industry will not take as great a hit as it has for other major disasters. Hurricane Andrew, for example, cost insurers $18 billion to $19 billion; the terrorist attacks on the World Trade Center could cost more than $40 billion. According to LeMaire, early estimates indicate insurers may be liable for about $10 billion as a result of the Asian tsunami. One plus for insurers, he says, is that many of the large global companies were paid premiums in dollars at a time when the currency was valued higher than it is now, when payouts are coming due….
Back to Thailand: Sting played the first concert in an affected country since the tsunami hit when he took the stage in Bangkok Wednesday night:
- The near-sellout Wednesday night arena concert, scheduled for the Thai capital before the waves hit, raised 50,000 dollars for tsunami victims in Thailand, including 20,000 from Sting’s own pocket, show organisers said.
But the Englishman in Bangkok chose to steer clear of any discussion about the tragedy which has rocked Indian Ocean countries including Thailand, where more than 5,300 people are confirmed dead and another 3,200 missing.
Instead, he opened the show with a song from his latest album, then strapped on his trademark bass and performed a poignant hit from the Police vault which cut to the heart of relief efforts across the region.
The 1979 song, “Message in a Bottle” speaks of a castaway’s lonely life and his desperate call for rescue.
“I’ll send an SOS to the world, I hope that someone gets my message in a bottle,” Sting sang.
….He was forced to cancel a gig in Sri Lanka in mid-February due to the devastation there, but is scheduled to play shows in Malaysia and India in early February.
Sting aims to raise more than one million Australian dollars (762,000 US) for tsunami victims with a benefit concert February 10 at one of Australia’s top vineyards after the Sri Lanka date was called off.
The outdoor concert in the renowned Margaret River wine producing region will have an audience of 6,000 wine buffs paying at least 150 Australian dollars for admission, with organisers and support staff all donating their wages and bar takings to relief funds. [AFP]
Good for you Gordon, rock on.