A Very Unfortunate Time to Say “I Told You So”

I published the following op-ed six months ago:

Aren’t you tired of all the surprises? Don’t you wish, just once, we could prevent a crisis instead of reacting to it?

Here’s your chance.

If you’re like most Americans, you were shocked to learn that the law only required BP to pay $75 million of the damage from its oil leak. You probably felt a little cheated by Congress, which promised your tax dollars to clean up after a company that made over $20 billion in profits last year.

If so, you won’t be too pleased when I tell you that we afford the same kind of protection to our nuclear power plants.  

Under the Price-Anderson Nuclear Industries Indemnity Act, every nuclear power plant must carry insurance for any leaks, explosions, or other dangerous events.

First catch: Insurance companies are only willing to pay up to $300 million. If the BP spill teaches us anything, it’s that billions of dollars of damage can pile up overnight.

Second catch: If the damage exceeds the insurance, the law requires all power plants across the country to split the remaining costs equally.

Third catch: The law only requires each plant to pay up to $95.8 million. If you’re only responsible for $95.8 million, why not take a $20 billion risk?

Bottom line: If a nuclear incident causes damages of more than $11.1 billion, you and I have to pay the rest.

Let me try to read your mind: “What the heck was Congress thinking?”

Some legislators were thinking of re-election. Like oil companies, the nuclear industry is a big campaign contributor. And building a power plant isn’t a bad way to bring money and jobs to your district.

But there’s a less cynical explanation. Some risks are too difficult to insure. When this law passed in 1957, nuclear power had a short history. Even the best engineers couldn’t predict how often leaks would occur.

Even today, preparing for a nuclear meltdown isn’t like auto insurance. Car accidents occur everyday, and each accident is a small fraction of the insurance company’s expenses.

If we want to promote uncertain technologies like nuclear power or deepwater oil drilling or credit default swaps, private markets need the help of the government.

But is it worth taxpayers’ support?

Even with that subsidy, nuclear plants are so risky that private investors are devoting billions of dollars to solar and wind and none to nuclear. They are so expensive to build that new reactors will cost consumers three times what they’re currently paying for electricity.

“If you were a utility CEO and looked at your world today,” says the chief executive of General Electric, “you would never do nuclear. The economics are overwhelming.”

And the odds of a multibillion-dollar disaster are higher than you think. One out of every four American reactors has been leaking radioactive gas, according to the Nuclear Regulatory Commission. In the past decade, 17 of those leaks have poisoned the groundwater at levels above EPA standards, according to the NRC. Children living near reactors have a higher risk of getting leukemia, according to the European Journal of Cancer Care.

Better alternatives exist. Concentrated solar power is already cost-competitive with nuclear. We no longer need the subsidy.

Now that the oil leak is fixed, it’s time to prevent the next surprise.

But wait. It gets worse. Thanks to the investigative journalists at ProPublica, we now know:

U.S. officials say the nation’s health system is ill-prepared to cope with a catastrophic release of radiation…

One example: The U.S. Strategic National Stockpile stopped purchasing the best-known agent to counter radioactive iodine-induced thyroid cancer in young people, potassium iodide, about two years ago…

Another example: While hospitals near nuclear power plants often drill for radiological emergencies, few hospitals outside of that area practice such drills. Most medical personnel are untrained and unfamiliar with the level of risk posed by radiation…

Many states don’t have a basic radiation emergency plan for communicating with the public or responding to the health risks. Even something as fundamental as the importance of sheltering inside sturdy buildings to avoid exposure to radioactive fallout from a nuclear explosion — which experts say could determine whether huge numbers of people live or die — hasn’t been communicated to the public.

It isn’t known…how a nuclear blast and electromagnetic pulse would affect modern communications infrastructure, or to what extent modern buildings can protect people from nuclear blast, heat and radiation effects.

Almost 85 percent of the officials said their states couldn’t properly respond to a radiation incident because of inadequate planning, resources, staffing and partnerships.

President Obama’s proposed budget would cut funding for a federal hospital preparedness program by about 10 percent.

Dear God. It can’t possibly get worse, can it? Yes, apparently it can:

If the United States faced a nuclear disaster, local governments would automatically take charge, followed by federal authorities if the crisis grew too big for local responders to handle. But this system has a flaw: The nation’s emergency plans don’t spell out when or how the transfer of authority would be handled, even though small delays could put thousands of lives at risk.

On March 13, Rep. Edward Markey, D-Mass., wrote a letter to President Obama raising concerns that “no agency sees itself as clearly in command of emergency response in a nuclear disaster. … One Agency official essentially told my staff that if a nuclear incident occurred, they would all get on the phone really quickly and figure it out.”

Many observers, including Michael McDonald, the president of Global Health Initiatives, have warned that the emergency command system itself, adopted in recent years across all levels of government, would likely break down in a serious nuclear or radiological emergency, and that more flexible, adaptive systems are needed.

I gave my warning last year. Now Japan gives us a second warning. We may not get a third.