While it seems a lot of people have “Japan fatigue”, an interesting piece in the Times today makes clear that the key factor in the Chernobyl-like disaster at Fukushima has its roots in the incestuous relations between the regulators and the – allegedly – regulated.
It details the suppression and expulsion from the nuclear “village” of well-credentialed whistle-blowers about conditions at Daiichi as long as a decade ago, even more serious problems that were covered up, but have since become dangerously exposed — so to speak.
All in the context of the massively intertwined relationships between the now-infamous Tokyo Electric Power Company – TEPCO – and its alleged regulator the Nuclear and Industrial Safety Agency — including the latter’s leaking of the name of the now proven insufficiently critical whistle blower that resulted in his shunning from Japan’s nuclear “village.”
But before Americans get too high and mighty about systemic corruption in Japan, they might want to think about not just how GE’s tax department has managed to become “the world’s greatest tax law firm” — and legally avoided paying taxes on a, probably understated, $14 billion profit, but also how regulatory agencies creating hundreds of new rules for the nation’s banks currently face a lobbying blitz from companies intent on softening the blow basically made up of lobbyists from their former colleagues.
Indeed, by last summer, 150 lobbyists registered since 2009 used to work in the executive branch at financial agencies, from lawyers for the Securities and Exchange Commission to Federal Reserve bankers.
“The headhunters are out in force” to recruit former government regulators as lawyers and lobbyists, said one who was doing just that.
So as we look at how the effective lack of regulation in Japan resulted in the Fukushima nightmare, we should be aware that the exact same dynamic is being played out in the US financial sector every day, creating all sorts of possibilities for the ultimate explosion of what St Warren of Buffett so aptly called “the financial weapons of mass destruction.”