All posts tagged Icelandic Volcanoes

Risk, Volcanic Ash, Regulation and the Leaders debate 2

John Redwood today makes some brilliant observations on “Bash the banks and Praise the Regulators”. His comparison with the ash cloud and the banking regulation is particularly apt. But it is not just the cost of inappropriate regulation that there is a similarity. The leaders’ debate of tonight showed crystallised the issue for me. It is how do the authorities deal with an unprecedented situation? The risk-averse say let us do nothing until there is full information. On the financial system, nothing was done to control the excesses. On the ash cloud everything was stopped until the scope of the problem could be assessed by the experts.

There is a way of going into the unknown without full information. You set general rules and assess the magnitude of any problem.

–         On the ash cloud, you compare the risk with the size of the eruption, the size of the particles and the distance from the volcano. From this, you would have found no evidence of large jet aircraft getting into emergency situations 1,000 miles from an eruption, in an ash cloud that is hardly visible.

–         From the financial system, the situation was evident that house prices and consumer borrowing was going to unsustainable levels on an unprecedented scale from 2003 onwards. The 0% interest credit cards and the large discounts for changing mortgages were evidence of this in the UK. The sub-prime boom, with mortgages deals agreed whereby in 3 years the borrowers could not meet their repayments was evidence of this in the USA. It was the very magnitude of the problem that should have merited special attention. The action should have been to raise interest rates and increase cash requirements for banks.

On the surface the action was the opposite – One to stop what was already happening, the other that immediately stopped anything from happening. But the cause is the same – by requiring detailed rules and acting on how others will perceive our actions, the authorities took wrong course of action.

 The Leader’s debate crystallised it for me. There was one leader who stood out. His reaction to any problem is not to take any risks.

–         He will not risk safety by letting planes fly.

–         He will not start cuts now to risk the recovery.

–         He will not risk banks ever getting into trouble again.

–         He will not risk a foreigner being unidentified.

–         He will not risk existing jobs.

–         He will not risk offending our European neighbours by disagreeing with them.

–         He will not risk independent MPs, by banning them from second jobs and monitoring every penny they spend.

–         He will not risk independent thought, by stipulating what religions should believe.

–         He will not risk diversity in education by allowing independent schools to be formed in the state sector.

 In so doing, after another 5 years of his leadership we will have no recovery; we will have no decision-makers in government – just be taking orders from Brussels and the IMF; we will have no risk-takers in business as most will not want to overcome the ever-higher regulatory hurdles for achievements that are taxed away and vilified.

We will also have no future.

by manicbeancounter on 22/04/2010  •  Permalink
Posted in Beancounting Methodology, Credit Crunch, General Election 2010, Gordon Brown, Regulation, Spin (Propaganda)
Tagged , , , ,

Posted by manicbeancounter on 22/04/2010

https://manicbeancounter.com/2010/04/22/risk-volcanic-ash-regulation-and-the-leaders-debate-2/

Iceland’s Volcanic Eruption in Perspective

A couple of days ago I wrote on John Redwood’s blog

“Nowadays we appear to be too risk averse. The two examples of aircraft suffering from engine failure as a result of flying through an volcanic ash clouds were both (most probably) within a few miles of the volcano. The current volcanic particles could be bigger, but the density of the clouds will be lower a thousand miles or more from the volcano. The risk to an engine going down is very small, especially if the more concentrated areas are avoided.”

In today’s Times, under “Government ‘too cautious’ over ash cloud, Adonis admits” we have the following:-

“Britain was among the last European countries to lift flying restrictions as the first flight touched down at Heathrow just before 10pm yesterday.”

Last night the Civil Aviation Authority accepted evidence from airlines and manufacturers that flights could pass through low-density ash cloud without risking passengers’ safety”

“Mr Brown said: “You have got to make sure that people are safe and secure.”

“We would never be forgiven if we had let planes fly and there was a real danger to people’s lives.”

 

I am not a scientist, merely an accountant who tries to put things in perspective. What drives Gordon Brown’s thinking is not to be perceived to be taking risks. This has cost us dearly in the reaction to terrorist attacks (even incompetent ones like the shoe-bomber and someone setting fire to their underpants); the reaction to swine flu and the reaction to climate change. Good decision-making is not a matter of how it will be perceived, or waiting until the evidence all goes one-way. Good decision-making through assessing the magnitude of risks with limited information.

by manicbeancounter on 21/04/2010  •  Permalink
Posted in Climate Change, General Election 2010, Gordon Brown
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Posted by manicbeancounter on 21/04/2010

https://manicbeancounter.com/2010/04/21/491/

Icelandic Volcanoes – Climate Change in Proportion

Climate Change is not completely wrong. It simply exaggerates the impact rising temperatures, the greenhouse effect on those changes and then ability of human beings to change that.

An (extreme) example is the attempt to link the frequency of volcanic eruptions in Iceland due to the thinning ice caps.

This proposition is “As the ice melts the rock can melt because the pressure decreases,”

Wattsupwiththat try to put this in perspective through a two-step process.

1. Estimate the change in rock temperature melt point as the pressure decreases. This is estimated at 0.0013°C per metre of ice, so the disappearance of the entire 500m thick ice sheet would decrease the melting point of the magma beneath by around 0.5°C, or less than 0.05%. The actual loss is estimated at 10%.

2. In terms  of pressure, 500m of ice is equivalent to 20m or less of rock. However, volcanic eruptions are caused by magma rising to the surface from many kilometres down. 20m of rock is hardly significant in this.

However, the current problem of steam/ash clouds is caused by the magma being rapidly cooled by the ice. So without glaciers we would not have the current problem of planes being grounded.

What is important is the lack of perspective that the researchers have shown.  

Using a research

by manicbeancounter on 17/04/2010  •  Permalink
Posted in Beancounting Methodology, Climate Change
Tagged ,

Posted by manicbeancounter on 17/04/2010

https://manicbeancounter.com/2010/04/17/icelandic-volcanoes-climate-change-in-proportion/