Stock Market Analysis

2011-03-16T16:46:00.000-07:00

WASHINGTON — The chairman of the United States Nuclear Regulatory Commission gave a significantly bleaker appraisal of the threat posed by Japan’s nuclear crisis than the Japanese government, saying on Wednesday that the damage at one crippled reactor was much more serious than Japanese officials had acknowledged and advising Americans to evacuate a wider area around the plant than the perimeter established by Japan.

The announcement marked a new and ominous chapter in the five-day long effort by Japanese engineers to bring four side-by-side reactors under control after their cooling systems were knocked out by an earthquake and tsunami last Friday. It also suggested a serious split between Washington and Tokyo, after American officials concluded that the Japanese warnings were insufficient, and that, deliberately or not, they had understated the potential threat of what is taking place inside the nuclear facility.

Gregory Jaczko, the chairman of the commission, said in Congressional testimony that the commission believed that all the water in the spent fuel pool at the No. 4 reactor of the Fukushima Daiichi Nuclear Power Station had boiled dry, leaving fuel rods stored there exposed and bleeding radiation. As a result, he said, “We believe that radiation levels are extremely high, which could possibly impact the ability to take corrective measures.”

On Thursday morning a spokesman for Tokyo Electric Power, the Daiichi plant operator, and a spokesman for Japan’s nuclear regulatory agency, denied Mr. Jaczko’s account, saying the situation at reactor No. 4 had not changed and that water remained in the spent fuel storage pool. But both officials said the situation was changing and that the reactor had not been inspected in recent hours.

"We can’t get inside to check, but we’ve been carefully watching the building’s environs, and there has not been any particular problem," said Hajime Motojuku, the spokesman for Tokyo Electric.
Takumi Koyamada, the spokesman at Japan’s nuclear regulator, said that as of 12 hours ago water remained and the temperature reading was 84 degrees Celsius and that no change had been reported since then. "We cannot confirm that there has been a loss in water," he said. "But we face a very unpredictable situation." If the American analysis is accurate and Japanese workers have been unable to keep the spent fuel at that inoperative reactor properly cooled — it needs to remain covered with water at all times — radiation levels could make it difficult not only to fix the problem at reactor No. 4, but to keep workers at the Daiichi complex from servicing any of the other problem reactors at the plant.

Mr. Jaczko (the name is pronounced YAZZ-koe) said radiation levels may make it impossible to continue what he called the “backup backup” cooling functions that have so far helped check the fuel melting at the other reactors. Those efforts consist of using fire hoses to dump water on overheated fuel and then letting the radioactive steam vent into the atmosphere.
Those emergency measures, implemented by a small squad of workers and firemen, are the main steps Japan is taking at Daiichi to forestall a full blown fuel meltdown that would lead to much higher releases of radioactive material.

Mr. Jaczko’s testimony came as the American Embassy in Tokyo, on advice from the Nuclear Regulatory Commission, told Americans to evacuate a radius of “approximately 50 miles” from the Fukushima plant.

The advice represents a graver assessment of the risk in the immediate vicinity of Daiichi than the warnings made by the Japanese themselves, who have told everyone within 20 kilometers, about 12 miles, to evacuate, and those between 20 and 30 kilometers to take shelter.
Mr. Jaczko’s testimony, the most extended comments by a senior American official on Japan’s nuclear disaster, described what amounts to an agonizing choice for Japanese authorities: Send a small number of workers into an increasingly radioactive area in a last-ditch effort to cover the spent fuel, and the fuel in other reactors, — with water, or do more to protect the workers but risk letting the pools of water protecting the fuel boil away — and thus risk a broader meltdown.

Mr. Jaczko was asked by Michael Burgess, a Republican of Texas and a member of the House committee where he was testifying, if the radiation levels at the plant boundary could be related to a chest x-ray or a cat scan. Mr. Jaczko said the Nuclear Regulatory Commission believed they were “Levels that would be lethal with a fairly short period of time.’’

Recently, he said, there were “very very high readings.”
Experts say workers at the plant probably could not approach a fuel pool that was dry, because radiation levels would be so high. In a normally operating pool, the water provides not only cooling but also shields workers from gamma radiation. A plan to dump water into the pool, and others like it, from helicopters was suspended because the crews would be flying right into a radioactive plume.

Mr. Jaczko’s analysis suggests that a potentially dangerous chain of events could unfold, as workers trying to cool the adjacent reactors at the facility could also be exposed to intolerable levels of radiation. If they, too, had to withdraw, the problem could worsen, as reactor cores go uncooled and spent fuel pools run dry.

Earlier in the day, Japanese authorities announced a different escalation of the crisis at Daiichi when they said that a second reactor unit at the plant may have suffered damage to its primary containment structure and appeared to be releasing radioactive steam.
The break, at the No. 3 reactor unit, worsened the already perilous conditions at the plant, a day after officials said the containment vessel in the No. 2 reactor had also cracked.

The possibility of high radiation levels above the plant prompted the Japanese military to put off a highly unusual plan to dump water from helicopters — a tactic normally used to combat forest fires — to lower temperatures in a pool containing spent fuel rods that was dangerously overheating at the No. 4 reactor. The operation would have meant flying a helicopter into the steam rising from the plant.

But in one of a series of rapid and at times confusing pronouncements on the crisis, the authorities insisted that damage to the containment vessel at the No. 3 reactor — the main focus of concern earlier on Wednesday — was unlikely to be severe.

Yukio Edano, the chief cabinet secretary, said the possibility that the No. 3 reactor had “suffered severe damage to its containment vessel is low.” Earlier he said only that the vessel might have been damaged; columns of steam were seen rising from it in live television coverage.
The reactor’s operator, Tokyo Electric Power Company, said it had been able to double the number of people battling the crisis at the plant to 100 from 50, but that was before the clouds of radioactive steam began billowing from the plant. On Tuesday, 750 workers were evacuated, leaving a skeleton crew of 50 struggling to reduce temperatures in the damaged facility. An increasing proportion of the people at the plant are soldiers, but the exact number is not known.

The Pentagon said Wednesday that American military forces in Japan were not allowed within 50 miles of the plant and that some flight crews who might take part in relief missions were being given potassium iodide to protect against the effects of radiation. Tokyo Electric said Wednesday that some of those at the plant had taken cover for 45 minutes on site, and left water pumps running at reactors Nos. 1, 2 and 3. There was no suspension of cooling operations, said Kazuo Yamanaka, an official at Tokyo Electric.

The vessel that possibly ruptured on Wednesday had been seen as the last fully intact line of defense against large-scale releases of radioactive material from the stricken reactor, but it was not clear how serious the possible breach might be.

The possible rupture, five days after a devastating earthquake and tsunami crippled the plant, followed a series of explosions and other problems there that have resulted in the world’s worst nuclear crisis since the Chernobyl accident in 1986.

The head of the Vienna-based International Atomic Energy Agency, Yukiya Amano, who is Japanese, said he would leave for Japan as soon as possible to assess the situation.

The revised official assessment of the severity of the damage at the No. 3 reactor may have been intended to reduce some concerns about the containment vessel, which encloses the core, but the implications of overheating in the fuel rod pool at No. 4 seemed potentially dire.
There are six reactors at the plant, all of which have pools holding spent fuel rods at the top level of the reactor building. Reactors 4, 5 and 6 were out of service when the earthquake and tsunami struck, and there were concerns about the pools at 5 and 6 as well, and possibly those at the other reactors.

At a hearing in Washington on Wednesday held by two subcommittee of the House Energy and Commerce Committee, Energy Secretary Steven Chu said, “We think there is a partial meltdown” at the plant.
“We are trying to monitor it very closely,’’ he said. “We hear conflicting reports about exactly what is happening in the several reactors now at risk. I would not want to speculate about what is happening.”

He said that his agency had sent 39 people to the American Embassy and to United States consulates in Japan “with the skills, expertise and equipment to help assess, survey and monitor areas.” The department has also shipped survey equipment that can measure radiation levels from the air, he said.

The developments were the latest in Japan’s swirling tragedy since the quake and tsunami struck the country with unbridled ferocity last Friday. Emperor Akihito made his first ever televised appearance on Wednesday to tell the nation he was “deeply worried” about the nuclear crisis.
International alarm about the nuclear crisis appeared to be growing, as several nations urged their citizens in Japan to head to safer areas in the south or leave the country. Prior advisories had largely been limited to simply avoiding nonessential travel. Germany urged its citizens to move to areas farther away from the stricken nuclear plant.

Earlier Wednesday morning, Tokyo Electric reported that a fire was burning at the No. 4 reactor building, just hours after officials said flames that erupted Tuesday had been doused.
A government official at Japan’s nuclear regulatory agency soon after said that flames and smoke were no longer visible, but he cautioned that it was unclear if the fire had died out. He also was not clear if it was a new fire or if the fire Tuesday had never gone out.

Fire Erupts at Troubled Reactor; Helicopters May Be Used at Plant

2011-03-15T16:06:00.000-07:00

TOKYO — The Japanese government reported early Wednesday that a fire was burning at the No. 4 reactor of the troubled Fukushima Daiichi plant in northeastern Japan.

Utility officials said the fire erupted because a blaze at the plant earlier had not been extinguished.
The announcement came just hours after officials with the Tokyo Electric Power Company said that they would consider using helicopters in an attempt to put cold water into a boiling rooftop storage pool for spent uranium fuel rods. The rods are still radioactive and potentially as hot and dangerous as the fuel rods inside the reactors if not kept submerged in water.

“The only ideas we have right now are using a helicopter to spray water from above, or inject water from below,” a power company official said at a news conference. “We believe action must be taken by tomorrow or the day after.”

Hydrogen gas bubbling up from chemical reactions set off by the hot spent fuel rods produced a powerful explosion on Tuesday morning that blew a 26-foot-wide hole in the outer building of Reactor No. 4 at the Fukushima Daiichi nuclear power plant. A fire there may have been caused by machine oil in a nearby facility, inspectors from the United States Nuclear Regulatory Commission said, according to an American official.
Concern remained high about the storage pools at that reactor and at two other reactors, Nos. 5 and 6. None of those three reactors at the plant, 140 miles northeast of Tokyo, were operating on Friday afternoon when an offshore earthquake with a magnitude now estimated at 9.0 suddenly shook the site. A tsunami with waves up to 30 feet high rolled into the northeast Japanese coastline minutes later, swamping the plant.

At least 750 workers were evacuated on Tuesday morning after a separate explosion ruptured the inner containment building at Reactor No. 2 at the Daiichi plant, which was crippled by Friday’s earthquake and tsunami. The explosion released a surge of radiation 800 times more intense than the recommended hourly exposure limit in Japan.

But 50 workers stayed behind, a crew no larger than would be stationed at the plant on a quiet spring day. Taking shelter when possible in the reactor’s control room, which is heavily shielded from radiation, they struggled through the morning and afternoon to keep hundreds of gallons of seawater a minute flowing through temporary fire pumps into the three stricken reactors, Nos. 1, 2 and 3, where overheated fuel rods continued to boil away the water at a brisk pace.

By early afternoon radiation levels had plunged, according to the International Atomic Energy Agency.

Workers have released surges of radiation each time they bleed radioactive steam from the troubled reactors in an attempt to manage the pressure inside them, but the reactors are not yet releasing high levels of radiation on a sustained basis, Japanese officials said.

The United States military revised its plans as radiation from the plant worsened. Some American warships that had been expected to arrive at the tsunami-shattered northeast coast of Honshu Island were diverted to the west coast instead because of concerns about radiation, the Navy said.
The Navy also promised to continue relief missions even though several more helicopter crews were testing positive for low-level exposure to radiation, and even as American military personnel and their families at the Yokosuka and Atsugi bases were encouraged to take precautions against radiation exposure.

Late Tuesday morning, Prime Minister Naoto Kan warned in a nationally televised address of rising radiation.

The chief cabinet secretary, Yukio Edano, urged people who live within about 18 miles of the plant to take
precautions. “Please do not go outside, please stay indoors, please close windows and make your homes airtight,” Mr. Edano said. More than 100,000 people are believed to be in the area.

Yukiya Amano, the director general of the International Atomic Energy Agency, said at a news conference at the organization’s Vienna headquarters that there was a “possibility of core damage” at reactor No. 2, but that the damage “is estimated to be less than 5 percent of the fuel.”

The sudden turn of events, after an explosion on Monday at one reactor and then an early-morning explosion on Tuesday at yet another — the third in four days at the plant — had already made the crisis at the plant the worst nuclear accident since the Chernobyl reactor disaster a quarter-century ago. It had become impossible for workers to remain at many areas within the plant for extended periods, the agency said. Japan has requested assistance from the Nuclear Regulatory Commission and the International Atomic Energy Agency.

In Tokyo, the metropolitan government said Tuesday that it had detected radiation levels 20 times above normal over the city, though it stressed that such levels posed no immediate health threat and that readings had dropped since then. The explosion in Reactor No. 2, a little after 6 a.m. on Tuesday, particularly alarmed Japanese officials and nuclear power experts around the world because it was the first detonation at the plant that appeared to occur inside one of the primary containment buildings.

Those buildings are fortresslike structures of steel and reinforced concrete, designed to absorb the impact of a plane crash and minimize radiation leaks. After a series of conflicting reports about how much damage the reactor had sustained after that blast, Mr. Edano said, “There is a very high probability that a portion of the containment vessel was damaged.”

Japanese officials subsequently said that the explosion had damaged a doughnut-shaped steel container of water, known as a torus, that surrounds the base of the reactor vessel inside the primary containment building.
Ruptures in the torus are serious, said Michael Friedlander, a senior nuclear power plant operator for 13 years at three plants in the United States, including three years at a General Electric boiling water reactor very similar to the ones in trouble in Japan. But the torus is not as important as the reactor vessel itself, which has 6.7-inch-thick steel walls and 8.4-inch-thick steel for its roof and floor. The vessel is designed to hold very high-pressure steam as well as the uranium fuel rods.

The reactor vessel has 20 safety valves that during a shutdown of the reactor inject steam into a million-gallon “suppression pool” of water in a steel torus immediately underneath it.
“Imagine if you had a big pressure cooker and you had a tube off the pressure cooker into a big tub of water — the suppression pool is the tub of water,” said Mr. Friedlander, a defender of nuclear power who is now a money manager in Hong Kong.

Steam vented into the suppression pool from the reactor vessel is not supposed to be radioactive. But the steam becomes radioactive, and potentially very radioactive, if the fuel rods in the reactor vessel above have begun to melt.

The atmosphere in the primary containment building, around the reactor vessel and above the suppression pool, is supposed to consist of inert nitrogen, with no oxygen at all. An inert atmosphere is used in the primary containment building to avoid the risk of oxygen explosions with hydrogen if the reactor starts producing much larger quantities of hydrogen gas than usual. Hydrogen gas is highly combustible with oxygen.

The blast on Tuesday morning that broke the suppression pool at reactor No. 2 shows that the reactor vessel is producing hydrogen and that oxygen may have somehow entered the atmosphere above the suppression pool, Mr. Friedlander said.

The primary containment building, with its massive steel and concrete walls, is housed with various ducts, electrical equipment and other gear inside a bigger building, the secondary containment building. Explosions at Reactors Nos. 1 and 3 blew the roofs off those reactors’ secondary containment buildings, which are not designed to contain hydrogen explosions, unlike primary containment buildings.

The storage pool blast at reactor No. 4 also appears to have ripped a hole in a secondary containment building, based on initial descriptions from Japanese officials.

A senior nuclear industry executive who insisted on anonymity said that a compromised suppression pool made it much harder to bleed high-pressure steam from an overheating nuclear re

U.S. Nuclear Industry Faces New Uncertainty

2011-03-14T13:47:00.000-07:00

WASHINGTON — The fragile bipartisan consensus that nuclear power offers a big piece of the answer to America’s energy and global warming challenges may have evaporated as quickly as confidence in Japan’s crippled nuclear reactors.

Until this weekend, President Obama, mainstream environmental groups and large numbers of Republicans and Democrats in Congress agreed that nuclear power offered a steady energy source and part of the solution to climate change, even as they disagreed on virtually every other aspect of energy policy. Mr. Obama is seeking tens of billions of dollars in government insurance for new nuclear construction, and the nuclear industry in the United States, all but paralyzed for decades after the Three Mile Island accident in 1979, was poised for a comeback.
Now, that is all in question as the world watches the unfolding crisis in Japan’s nuclear reactors and the widespread terror it has spawned.

“I think it calls on us here in the U.S., naturally, not to stop building nuclear power plants but to put the brakes on right now until we understand the ramifications of what’s happened in Japan,” Senator Joseph I. Lieberman, independent of Connecticut and one of the Senate’s leading voices on energy, said on CBS’s “Face the Nation.”

Nuclear power, which still suffers from huge economic uncertainties and local concerns about safety, had been growing in acceptance as what appeared to many to be a relatively benign, proven and (if safe and permanent storage for wastes could be arranged) nonpolluting source of energy for the United States’ future growth.

But even staunch supporters of nuclear power are now advocating a pause in licensing and building new reactors in the United States to make sure that proper safety and evacuation measures are in place. Environmental groups are reassessing their willingness to see nuclear power as a linchpin of any future climate change legislation. Mr. Obama still sees nuclear power as a major element of future American energy policy, but he is injecting a new tone of caution into his endorsement.
“The president believes that meeting our energy needs means relying on a diverse set of energy sources that includes renewables like wind and solar, natural gas, clean coal and nuclear power,” said Clark Stevens, a White House spokesman. “Information is still coming in about the events unfolding in Japan, but the administration is committed to learning from them and ensuring that nuclear energy is produced safely and responsibly here in the U.S.”

Three of the world’s chief sources of large-scale energy production — coal, oil and nuclear power — have all experienced eye-popping accidents in just the past year. The Upper Big Branch coal mine explosion in West Virginia, the Deepwater Horizon blowout and oil spill in the Gulf of Mexico and the unfolding nuclear crisis in Japan have dramatized the dangers of conventional power generation at a time when the world has no workable alternatives able to operate at sufficient scale.
The policy implications for the United States are vexing. “It’s not possible to achieve a climate solution based on existing technology without a significant reliance on nuclear power,” said Jason Grumet, president of the Bipartisan Policy Center in Washington and an energy and climate change adviser to the 2008 Obama campaign. “It’s early to reach many conclusions about what happened in Japan and the relevance of what happened to the United States. But the safety of nuclear power will certainly be high on the list of questions for the next several months.”

“The world is fundamentally a set of relative risks,” Mr. Grumet added, noting the confluence of disasters in coal mining, oil drilling and nuclear plant operations. “The accident certainly has diminished what had been a growing impetus in the environmental community to support nuclear
power as part of a broad bargain on energy and climate policy.”

Mitch McConnell of Kentucky, the Senate Republican leader, said that the United States should not overreact to the Japanese nuclear crisis by clamping down on the domestic industry indefinitely. Republicans have loudly complained that the Obama administration did just that after the BP oil spill last spring when it imposed a moratorium on deepwater oil drilling until new safety and environmental rules were written.
“I don’t think right after a major environmental catastrophe is a very good time to be making American domestic policy,” Mr. McConnell said on “Fox News Sunday.”
He said that the American public and politicians had recoiled after Three Mile Island, rejecting permits for the construction of dozens of nuclear plants on the “not in my backyard” impulse.
“My thought about it is, we ought not to make American and domestic policy based upon an event that happened in Japan,” Mr. McConnell said.

Mr. Obama has been as supportive of nuclear power as any recent president as he has tried to devise a political and technical strategy for ensuring energy supplies and reducing greenhouse gas emissions. Nuclear power, along with expanded offshore oil drilling, “clean coal” development and extensive support for renewable energy, are part of his “all-of-the-above energy strategy,” an approach and terminology borrowed from Republicans. But his support for coal and oil as part of a grand compromise on energy were set back by last year’s mining and drilling disasters, and today’s problems with nuclear in Japan cannot help.

Concerns about earthquakes and nuclear power have been around for a long time; new questions might also be raised now about tsunamis and coastal reactors.
In Mr. Obama’s State of the Union address and in his budget, he proposed an expansion of nuclear energy technology and $36 billion in Department of Energy loan guarantees for the construction of as many as 20 new nuclear plants.

That policy will be on the table at a hearing of the Energy and Commerce Committee on Wednesday, when Steven Chu, the energy secretary, and Gregory B. Jaczko, chairman of the Nuclear Regulatory Commission, are scheduled to testify.
“We will use that opportunity to explore what is known in the early aftermath of the damage to Japanese nuclear facilities,” said Representative Fred Upton, Republican of Michigan, the committee chairman, “as well as to reiterate our unwavering commitment to the safety of U.S. nuclear sites.”

Representative Edward J. Markey, Democrat of Massachusetts and a skeptic of nuclear power who nonetheless supported expansion of nuclear power as part of the House energy and climate legislation he co-sponsored, said the United States needed tougher standards for siting and operating nuclear plants.

He said regulators should consider a moratorium on locating nuclear plants in seismically active areas, require stronger containment vessels in earthquake-prone regions and thoroughly review the 31 plants in the United States that use similar technology to the crippled Japanese reactors. “The unfolding disaster in Japan must produce a seismic shift in how we address nuclear safety here in America,” Mr. Markey said.

Emergency Cooling Effort at Reactor Is Failing, Deepening Japanese Crisis

2011-03-14T13:43:00.000-07:00

TOKYO — Japan’s struggle to contain the crisis at a stricken nuclear power plant worsened early Tuesday morning, as emergency operations to pump seawater into one crippled reactor temporarily failed, increasing the risk of a wider release of radioactive material, officials said.
With the cooling systems malfunctioning simultaneously at three separate reactors at the Fukushima Daiichi Nuclear Power Station after the powerful earthquake and tsunami, a more acute crisis developed late Monday at reactor No. 2 of the plant. There, a series of problems thwarted efforts to keep the core of the reactor covered with water — a step considered crucial to preventing the reactor’s containment vessel from exploding and preventing the fuel inside it from melting down.
The plant’s operator, Tokyo Electric Power, said late Monday that efforts to inject seawater into the reactor had failed. That caused water levels inside the reactor’s containment vessel to fall and exposed its fuel rods. The company said its workers later succeeded in infusing seawater in the pre-dawn hours of Tuesday morning, but fuel rods were exposed for at least several hours.
Workers had been having difficulty injecting seawater into the reactor because its vents — necessary to release pressure in the containment vessel by allowing radioactive steam to escape — had stopped working properly, they said.
But Tuesday morning Tokyo Electric announced that workers had succeeded in opening a malfunctioning valve controlling the vents, reducing pressure in the container vessel. It then resumed flooding the reactor with water.
The company said water levels were not immediately rising to the desired level, possibly because of a leak in the containment vessel. Still, a Tokyo Electric official said the situation was improving.
"We do not feel that a critical event is imminent," he told a press conference.
The release of pressure appears to avert the immediate risk that the containment vessel would explode, creating a potentially catastrophic release of radioactive material into the atmosphere. But if the vessel is cracked and is not holding water properly, the risks of a large scale release of radioactive material would remain high.
In reactor No. 2, which is now the most damaged of the three at the Daiichi plant, at least parts of the fuel rods have been exposed for several hours, which also suggests that some of the fuel has begun to melt. Government and company officials said fuel melting has almost certainly occurred in that reactor, which can increase releases of radioactive material through the water and steam that escapes from the container vessel.
In a worst case, the fuel pellets could also burn through the bottom of the containment vessel and radioactive material could pour out that way — often referred to as a full meltdown.
"There is a possibility that the fuel rods are heating up and starting to melt,” said a Tokyo Electric spokesman told a late-night conference on Monday, televised on public broadcaster NHK. “It is our understanding that we have possible damage to the fuel rods,” he said.
By Monday night, officials said that radiation readings around the plant reached 3,130 micro Sievert, the highest yet detected at the Daiichi facility since the quake and six times the legal limit. Radiation levels of that magnitude are considered elevated, but they are much lower than would be the case if one of the container vessels had been compromised.
Industry executvies in touch with their counterparts in Japan Monday night grew increasingly alarmed about the risks posed by the No. 2 reactor.
“They’re basically in a full-scale panic” among Japanese power industry managers, said a senior nuclear industry executive. The executive is not involved in managing the response to the reactors’ difficulties but has many contacts in Japan. “They’re in total disarray, they don’t know what to do.”
The venting problems made it impossible for a time to administer the emergency remedy the plant operator had been using to control heat at the three crippled Daiichi reactors, all of which experienced failures in their electronic cooling systems. That remedy involves pumping in seawater to cool the fuel rods, then opening vents to release the resulting steam pressure that builds in the container vessel. When the vessel is depressurized, workers can inject more seawater, a process known as “feed and bleed.”

The extreme challenge of managing reactor No. 2 came as officials were still struggling to keep the cores of two other reactors, No. 1 and No. 3, covered with seawater. There was no immediate indication that either of those two reactors had experienced a crisis as serious as that at No. 2.
The United States Nuclear Regulatory Commission said Monday that the Japanese government had formally asked for assistance as it responds to the crisis in Fukushima. As part of a wider response, the United States has already dispatched two experts in boiling-water reactors, the type used at Daiichi. They are in Tokyo offering technical assistance to the Japanese, the commission said in a statement. The commission is considering further assistance, including providing technical advice, it said.
The situation at Daiichi was also complicated on Monday by another problem when the outer structure housing reactor No. 3 exploded earlier on Monday. A similar explosion destroyed the structure surrounding reactor No. 1 on Saturday. Live footage on public broadcaster NHK showed the skeletal remains of the reactor building and thick smoke rising from the building. Eleven people had been injured in the blast, one seriously, officials said.
Chief Cabinet Secretary Yukio Edano said earlier Monday evening that the release of large amounts of radiation as a result of the explosion at No. 3 was unlikely because the blast did not compromise the steel containment vessel inside the No. 3 reactor. But traces of radiation could be released into the atmosphere, and about 500 people who remained within a 12-mile radius were ordered temporarily to take cover indoors, he said.
“I have received reports that the containment vessel is sound,” Mr. Edano said. “I understand that there is little possibility that radioactive materials are being released in large amounts.”
Mr. Edano and other senior officials did not address the escalating crisis at reactor No. 2 later Monday or early Tuesday.
But the situation a reactor No. 3 was being closely watched for another reason. That reactor uses a special mix of nuclear fuel known as MOX fuel. MOX is considered contentious because it is made with reprocessed plutonium and uranium oxides. Any radioactive plume from that fuel would be more dangerous than ordinary nuclear fuel, experts say, because inhaling plutonium even in very small quantities is considered lethal.
In screenings, higher-than-normal levels of radiation have been detected from at least 22 people evacuated from near the plant, the nuclear safety watchdog said, but it is not clear if the doses they received were dangerous.
Technicians had been scrambling most of Sunday to fix a mechanical failure that left the reactor far more vulnerable to explosions.
The two reactors where the explosions occurred are both presumed to have already suffered partial meltdowns — a dangerous situation that, if unchecked, could lead to a full meltdown.

Nuclear Plants in Europe Are Delayed

2011-03-14T13:40:00.000-07:00

BERLIN — With the crisis in Japan raising fears about nuclear power, Germany and Switzerland said on Monday that they would reassess the safety of their own reactors and possibly reduce their reliance on them.
Doris Leuthard, the Swiss energy minister, said Switzerland would suspend plans to build and replace nuclear plants. She said no new ones would be permitted until experts had reviewed safety standards and reported back. Their conclusions will apply to existing plants as well as planned sites, she added. Swiss authorities recently approved three sites for new nuclear power stations.
Germany will suspend “the recently decided extension of the running times of German nuclear power plants,” Chancellor Angela Merkel told reporters in Berlin. “This is a moratorium and this moratorium will run for three months.” She said the suspension would allow for a thorough examination of the safety standards of the county’s 17 nuclear power plants.
“There will be no taboos,” Mrs. Merkel said.
Even when the three months is over, Mrs. Merkel warned, there would be no going back to the situation before the moratorium.
Across Europe, officials worried about the Continent’s use of nuclear power as cooling systems failed at a third nuclear reactor in Japan and officials in that country struggled to regain control.
The European Union called for a meeting on Tuesday of nuclear safety authorities and operators to assess Europe’s preparedness. Austria’s environment minister, Nikolaus Berlakovich, called for a European Union-wide stress test “to see if our nuclear power stations are earthquake-proof.”
In Germany, with Mrs. Merkel’s center-right coalition facing important regional elections this month, the move was apparently in part an effort to placate the influential antinuclear lobby and give her coalition some breathing space before making a final decision about nuclear energy.
The foreign minister, Guido Westerwelle, called for a new risk analysis of the country’s nuclear plants, particularly regarding their cooling systems. He is the leader of the pro-business Free Democratic Party, which strongly supports nuclear power.
A previous government, led by the Social Democrats and Greens, pushed through legislation in 2001 to close all of the country’s nuclear plants by 2021. But Mrs. Merkel’s center-right government reversed that decision last year and voted to extend the lives of the plants by an average of 12 years.
Nuclear energy provides about 11 percent of Germany’s energy supply but its contribution to electricity output is about 26 percent.
In Switzerland, the suspension of plans to build and replace plants will affect all “blanket authorization for nuclear replacement until safety standards have been carefully reviewed and if necessary adapted,” Ms. Leuthard, the energy minister, said in a statement.
Switzerland has five nuclear reactors, which produce about 40 percent of the country’s energy needs.
Ms. Leuthard said she had already asked the Federal Nuclear Safety Inspectorate to analyze the exact cause of the problems in Japan and draw up new or tougher safety standards “particularly in terms of seismic safety and cooling.”
In Russia, Prime Minister Vladimir V. Putin said his government would not revise its ambitious program of building nuclear reactors but would “draw conclusions from what’s going on in Japan,” Russian news agencies reported. Nuclear power currently accounts for 16 percent of Russia’s electricity generation.

E.U.'s Latest Rescue Package Seen Falling Short-Again

2011-03-14T13:39:00.000-07:00

LONDON — Another missed opportunity for Europe?
Over the past year, the European Union and the International Monetary fund have pledged €640 billion in bailout funds to distressed economies on the Continent’s periphery. Yet the interest rates on benchmark bonds in Greece, Ireland and Portugal remain at or near their historic highs.
Pressed yet again by a skeptical market to take action, Europe’s leaders cobbled together a new structure over the weekend that will allow its rescue fund, the European Financial Stability Facility, to disburse its entire €440 billion, or $615 billion, allotment if needed, and to buy bonds at government auctions. They also eased the conditions on Greece’s rescue loans by reducing interest rates and extending repayment terms.
Analysts and investors greeted the effort Monday with cautious approval, as euro zone finance ministers regrouped to work out more details.
But as has often been the case with grand European rescue plans, there appears to be a catch: While the European rescue facility can now buy bonds at government auctions, it will not be able to purchase paper in the secondary market. That will heap more pressure on an ever-reluctant European Central Bank to remain in its job as peripheral Europe’s buyer of last resort.
What is more, the plan states that the fund can buy bonds only from countries that have taken bailout funds, an odd stipulation that means that the country most in need of support at the moment — Portugal — does not get any.
Consequently, pressure on Portuguese 10-year bonds eased only slightly Monday, with interest rates sticking close to the 7.4 percent level at which they have traded for the past few weeks. Greek bonds rallied on the interest rate deal, but Irish bonds made only the smallest move as they did not receive a break on their interest rate. Spanish yields fell to 5.2 percent, still close to their high of 5.4 percent.
“What we have now falls short of what is required, which is a way to bring interest rates down,” said Dirk Hoffman-Becking, a banking analyst at Sanford C. Bernstein in London.
Mr. Hoffman-Becking argued that these persistently high rates only recycled fear and uncertainty via higher funding costs for banks and, ultimately, lower economic growth. He added that unless the E.F.S.F. stepped into the secondary market to buy bonds in large quantities, rates would remain high. That is because private investors remain unwilling to buy given the risk of default and the risk that austerity programs will undermine economic recovery.
Again, the example of Portugal is relevant. Last Friday, the government in Lisbon promised more spending cuts and revenue-raising measures to make good on its promise to bring the budget deficit down to 4.6 percent of gross domestic product, from 7.4 percent this year. But with one of the lowest growth rates in Europe, an uncompetitive export industry and public debt at 80 percent of G.D.P., investors see little upside in buying Portuguese bonds now, even at such wide spreads to comparable German bonds.
For the most part, the E.C.B. has been unwilling to step in aggressively — it has purchased only €77 billion in peripheral-country bonds so far. On Monday, the bank reported that it had not bought any bonds last week, for the second week in a row.
Thus, the lack of a big buyer is expected to keep rates high and continue to feed market unease. And that in many ways remains the unsolved root of Europe’s sovereign debt crisis.
Euro zone governments and the I.M.F. are asking that investors take a leap of faith and accept that the bone-crunching austerity programs in Greece, Ireland and Portugal, underpinned by tax increases and sharp wage reductions, will reduce deficits and ultimately high levels of debt.
But, as a comprehensive new report on the origins of Europe’s debt crisis by the investment bank Nomura points out, what is more likely to happen is that the debt of countries like Greece and Ireland will merely increase in what economists call a snowball effect, as the interest rate on the government’s debt grows faster than their stagnating economies.
That problem will only be compounded when the European Central Bank increases interest rates, which it has warned it will do.
The result is a Catch-22 of sorts: the faster and deeper these countries cut, the slower they grow, with the perverse effect that their debt ends up increasing as opposed to decreasing.
“In the short term, this problem is inevitable — your debt will continue to increase as long as your growth rate is below the interest rate you are paying,” said Peter Westaway, European economist at Nomura in London and one of the authors of the report.
In 2013, for example, Greece’s debt will have increased to almost 160 percent of G.D.P. from 127 percent of G.D.P. And while the country was quick to hail its improved terms, the bottom line still remains that by 2014 it must begin paying interest equivalent to about 8 percent of its G.D.P. — a huge amount by any measure.
For now, Greece has time. But with growth expected to shrink again this year, by 3.4 percent, and with unemployment now at about 15 percent, how long the Greek government, or any government for that matter, can continue to expect so much public sacrifice to pay off its bankers remains to be seen.

Radioactive Releases in Japan Could Last Months, Experts Say

2011-03-13T19:27:00.000-07:00

WASHINGTON — As the scale of Japan’s nuclear crisis begins to come to light, experts in Japan and the United States say the country is now facing a cascade of accumulating problems that suggest that radioactive releases of steam from the crippled plants could go on for weeks or even months.
The emergency flooding of two stricken reactors with seawater and the resulting steam releases are a desperate step intended to avoid a much bigger problem: a full meltdown of the nuclear cores in two reactors at the Fukushima Daiichi Nuclear Power Station. So far, Japanese officials have said the melting of the nuclear cores in the two plants is assumed to be “partial,” and the amount of radioactivity measured outside the plants, though twice the level Japan considers safe, has been relatively modest.
But Pentagon officials reported Sunday that helicopters flying 60 miles from the plant picked up small amounts of radioactive particulates — still being analyzed, but presumed to include Cesium-137 and Iodine-121 — suggesting widening environmental contamination. In a country where memories of a nuclear horror of a different sort in the last days of World War II weigh heavily on the national psyche and national politics, the impact of continued venting of long-lasting radioactivity from the plants is hard to overstate.
Japanese reactor operators now have little choice but to periodically release radioactive steam until the radioactive elements in the fuel of the stricken reactors stop generating intense heat, a process that can continue for a year or more even after the fission process has stopped. To control that heat, the plant’s operator must constantly try to flood the reactors with seawater, then release the resulting radioactive steam into the atmosphere, several experts familiar with the design of the Daiichi facility said. That suggests that the 200,000 people who have been evacuated may not be able to return to their homes for a considerable period and that shifts in the wind could blow radioactive materials toward Japanese cities rather than out to sea.
Re-establishing normal cooling of the reactors would require restoring electric power — which was cut in the earthquake and tsunami — and now may require plant technicians working in areas that have become highly contaminated with radioactivity.
More steam releases also mean that the plume headed across the Pacific could continue to grow. On Sunday evening, the White House sought to tamp down concerns, saying that modeling done by the Nuclear Regulatory Commission had concluded that “Hawaii, Alaska, the U.S. Territories and the U.S. West Coast are not expected to experience any harmful levels of radioactivity.”
But all weekend, after a series of intense interchanges between Tokyo and Washington and the arrival of the first American nuclear experts in Japan, officials said they were beginning to get a clearer picture of what went wrong over the past three days, and as one senior official put it, “under the best scenarios, this isn’t going to end anytime soon.”
The essential problem is the definition of “off” in a nuclear reactor. When the nuclear chain reaction is shut and the reactor shuts down, the fuel is still producing about 6 percent as much heat as it did when it was running, because of continuing heat generation by the radioactivity, the release of subatomic particles and of gamma rays.
Usually, when a reactor is first shut down, an electrically driven pump pulls heated water from the vessel to a heat exchanger, and cool water from a river or ocean is brought in to draw off that heat.
But at the Japanese reactors, after losing electric power, that system could not be used. Instead the operators are dumping seawater into the vessel, and letting it cool the fuel by boiling. But as it boils, pressure rises too high to pump in more water, so they have to vent the vessel to the atmosphere, and feed in more water, a procedure known as “feed and bleed.”
When the fuel was intact, the steam they were releasing had only modest amounts of radioactive material, in a nontroublesome form. With damaged fuel, that steam is getting dirtier.
Re-establishing normal cooling will require electric power and may require workers to function in areas that are now contaminated, American nuclear experts say.
Christopher D. Wilson, a reactor operator and later a manager at Exelon’s Oyster Creek plant, near Toms River, N.J., said, “normally you would just re-establish electricity supply, from the on-site diesel generator or a portable one.” Portable generators have been brought into Fukushima, he said.
Fukushima was designed by General Electric, just as Oyster Creek was, at about the same time, and the two plants are very similar, he said. The problem, he said, was that the hook-up is done through electric switching equipment that is in a basement room flooded by the tsunami, he said. “Even though you have generators on site, you have to get the water out of the basement,” he said.
Another nuclear engineer with long experience in reactors of this type, who now works for a government agency, was emphatic. “To completely stop venting, they’re going to have to put some sort of equipment back in service,” he said. He asked not to be named because his agency had not authorized him to speak.
The central problem arises from a series of failures that began after the tsunami. It easily overcame the sea walls surrounding the Fukushima plant. It swamped the diesel generators, which were placed in a low-lying area, apparently because of misplaced confidence that the sea walls would protect them. At 3:41 p.m. Friday, roughly an hour after the quake and just around the time the region would have been struck by the giant waves, the generators shut down. According to Tokyo Electric Power Company, the plant switched to an emergency cooling system that operates on batteries, but these were soon depleted.
Inside the plant, according to industry executives and American experts who received briefings over the weekend, there was deep concern that spent nuclear fuel that was kept in a “cooling pond” inside one of the plants had been exposed and begun letting off potentially deadly gamma radiation. Then water levels inside the reactor cores began to fall. While estimates vary, several officials and industry experts said on Sunday that the top four to nine feet of the nuclear fuel in the core and control rods appear to have been exposed to the air — a condition that that can quickly lead to melting, and ultimately to a complete meltdown.
At 8 p.m., just as Americans were waking up to news of the earthquake, the government declared an emergency, contradicting its earlier reassurances that there were no major problems. But the chief cabinet secretary, Yukio Edano, stressed that there had been no radiation leak.
But one was coming: Workers inside the reactors saw that levels of coolant water were dropping. They did not know how severely. “The gauges that measure the water level don’t appear to be giving accurate readings,” one American official said.
What the workers knew by Saturday morning was that cooling systems at a nearby power plant, Fukushima Daini, were also starting to fail, for many of the same reasons. And the pressure in the No. 1 reactor at Fukushima Daiichi was rising so fast that engineers knew they would have to relieve it by letting steam escape, sending the first traces of radiation into the atmosphere.
Shortly before 4 p.m., camera crews near the Daiichi plant captured what appears to have been an explosion at the No. 1 reactor — apparently caused by a buildup of hydrogen. It was dramatic television but not especially dangerous — except to the workers injured by the force of the blast inside.
The explosion was in the outer container, leaving the main reactor vessel unharmed, according to Tokyo Electric’s reports to the International Atomic Energy Agency. (The walls of the outer building blew apart, as they are designed to do, rather than allow a buildup of pressure that could damage the reactor vessel.)
But the dramatic blast was also a warning sign of what could happen inside the reactor vessel if the core was not cooled. The International Atomic Energy Agency said that “as a countermeasure to limit damage to the reactor core,” Tokyo Electric proposed injecting seawater mixed with boron — which can absorb some of the reactive elements — and it began to do that at 10:20 p.m. Saturday.
It was a desperation move: The corrosive seawater will essentially disable the 40-year-old plant; the decision to flood the core amounted to a decision to abandon the facility. But even that operation has not been easy.
To pump in the water, the Japanese have apparently tried used fire-fighting equipment — hardly the usual procedure. But forcing the seawater inside the containment vessel has been extraordinarily difficult, because the pressure in the vessel has become so great.
One American official likened the process to “trying to pour water into an inflated balloon,” and said that on Sunday it was “not clear how much water they are getting in, or whether they are covering the cores.”
The problem was compounded because gauges inside the reactor seemed to have been damaged in the earthquake or the tsunami, making it impossible to know just how much water is in the core.
And workers attempting the pumping operation are presumed to be exposed to radiation; several workers, according to Japanese reports, have been treated for radiation poisoning. It is not clear how severe their exposure was.

Danger Posed by Radioactivity in Japan Hard to Assess

2011-03-12T15:54:00.000-08:00

The different radioactive materials being reported at the nuclear accidents in Japan range from relatively benign to extremely worrisome.

The central problem in assessing the degree of danger is that the amounts of various radioactive releases into the environment are now unknown, as are the winds and other atmospheric factors that determine how radiation-emitting materials will disperse around the stricken plants.
Still, the properties of the materials and their typical interactions with the human body give some indication of the threat.

“The situation is pretty bad,” said Frank N. von Hippel, a nuclear physicist who advised the Clinton White House and now teaches international affairs at Princeton. “But it could get a lot worse.”

In Vienna on Saturday, the International Atomic Energy Agency said Japanese authorities had informed it that iodine pills would be distributed to residents around the Fukushima Daiichi and Daini plants in northeast Japan. Both have experienced multiple failures in the wake of the huge earthquake and tsunami that struck Friday.
In the types of reactors involved, water is used to cool the reactor core and produce steam to turn the turbines that make electricity. The water contains two of the least dangerous radioactive materials now in the news — radioactive nitrogen and tritium. Normal plant operations produce both of them in the cooling water, and they are even released routinely in small amounts into the environment, usually through tall chimneys.

Nitrogen is the most common gas in the earth’s atmosphere, and at a nuclear plant the main radioactive form is known as nitrogen-16. It is made when speeding neutrons from the reactor’s core hit oxygen in the surrounding cooling water. This radioactive form of nitrogen does not occur in nature.

The danger of nitrogen-16 is an issue only for plant workers and operators because its half-life is only seven seconds, after which it decays back into natural nitrogen. A half-life is the time it takes half the atoms of a radioactive substance to disintegrate.
The other radioactive material often in the cooling water of a nuclear reactor is tritium. It is a naturally occurring radioactive form of hydrogen, sometimes known as heavy hydrogen. It is found in trace amounts in groundwater throughout the world. Tritium emits a weak form of radiation that does not travel very far in the air and cannot penetrate the skin.
It accumulates in the cooling water of nuclear reactors and is often vented in small amounts to the environment. Its half-life is 12 years.

The big worries on the reported releases of radioactive material in Japan center on radioactive iodine and cesium.

“They imply some kind of core problem,” said Thomas B. Cochran, a senior scientist in the nuclear program of the Natural Resources Defense Council, a private group in Washington.
The active core of a nuclear reactor splits atoms in two to produce bursts of energy and, as a byproduct, large masses of highly radioactive particles. The many safety mechanisms of a nuclear plant focus mainly on keeping these so-called fission products out of the environment.
Iodine-131 has a half-life of eight days and is quite dangerous to human health. If absorbed through contaminated food, especially milk and milk products, it will accumulate in the thyroid and cause cancer. Located near the base of the neck, the thyroid is a large endocrine gland that produces hormones that help control growth and metabolism.

Dr. von Hippel of Princeton said the thyroid danger was gravest in children. “The thyroid is more sensitive to damage when the cells are dividing and the gland is growing,” he said.
Fortunately, an easy form of protection is potassium iodide, a simple compound typically added to table salt to prevent goiter and a form of mental retardation caused by a dietary lack of iodine.
If ingested promptly after a nuclear accident, potassium iodide, in concentrated form, can help reduce the dose of radiation to the thyroid and thus the risk of cancer. In the United States, the Nuclear Regulatory Commission recommends that people living within a 10-mile emergency planning zone around a nuclear plant have access to potassium iodide tablets.
Over the long term, the big threat to human health is cesium-137, which has a half-life of 30 years.
At that rate of disintegration, John Emsley wrote in “Nature’s Building Blocks” (Oxford, 2001), “it takes over 200 years to reduce it to 1 percent of its former level.”

It is cesium-137 that still contaminates much of the land in Ukraine around the Chernobyl reactor. In 1986, the plant suffered what is considered the worst nuclear power plant accident in history.
Cesium-137 mixes easily with water and is chemically similar to potassium. It thus mimics how potassium gets metabolized in the body and can enter through many foods, including milk. After entering, cesium gets widely distributed, its concentrations said to be higher in muscle tissues and lower in bones.
The radiation from cesium-137 can throw cellular machinery out of order, including the chromosomes, leading to an increased risk of cancer.

The Environmental Protection Agency says that everyone in the United States is exposed to very small amounts of cesium-137 in soil and water because of atmospheric fallout from the nuclear detonations of the cold war.
The agency says that very high exposures can result in serious burns and even death, but that such cases are extremely rare. Once dispersed in the environment, it says, cesium-137 “is impossible to avoid.”

This article has been revised to reflect the following correction:

Cuba Gives 15-Year Prison Term to American

2011-03-12T15:50:00.000-08:00

A Cuban court sentenced an American government contractor, Alan Gross, to 15 years in prison for crimes against the state, Cuban state television reported Saturday.
Mr. Gross, 61, was detained in December 2009 while on a U.S.A.I.D. mission in Cuba designed to weaken the government. Cuban authorities said that Mr. Gross was distributing satellite telephone equipment, which could be sued to access the Internet, to Jewish groups in Cuba. Those groups have denied having anything to do with him.

The prosecution was seeking a 20-year sentence.
A panel of judges found that the evidence “demonstrated the participation of the North American contractor in a subversive project of the U.S. government that aimed to destroy the Revolution through the use of communications systems out of the control of authorities,” the Associated Press reported Saturday.

The United State National Security Council spokesman, Tommy Vietor, criticized the ruling and called again for Mr. Gross to be released. “Today’s sentencing adds another injustice to Alan Gross’s ordeal,” he said. “He has already spent too many days in detention and should not spend one more.”

Mr. Gross’ detention has been a point of contention between the United States and the Cuban government, even as President Obama has loosened restrictions on travel for groups like scholars and artists and pledged renewed engagement with the Cuban people.
Most political observers have said they expect Mr. Gross to be released on humanitarian grounds.

He has lost some 90 pounds while in detention, and his daughter had a double mastectomy after a cancer diagnosis last year.

Japan Floods Nuclear Reactor Crippled by Quake in Effort to Avert Meltdown

2011-03-12T15:44:00.000-08:00

TOKYO — Japanese officials took the extraordinary step on Saturday of flooding a crippled nuclear reactor with seawater in a last-ditch effort to avoid a nuclear meltdown, as the nation grappled simultaneously with its worst nuclear mishap and the aftermath of its largest recorded earthquake.

A radiation leak and explosion at the Fukushima Daiichi Nuclear Power Station on Saturday prompted the government to expand an evacuation order to affect 170,000 people in the plant’s vicinity. And the plant’s operator issued an emergency notice early Sunday morning that a second reactor at the same aging plant was also experiencing critical failures of its cooling system and that rising pressure there risked a new explosion.
The government said radiation emanating from the first reactor appeared to be decreasing after the blast Saturday afternoon destroyed part of the facility, and they said that they had filled it with sea water to prevent full meltdown of the nuclear fuel. That step would only be taken in extreme circumstances because ocean water is likely to permanently disable the reactor.

The Japanese Nuclear and Industrial safety agency said as many as 160 people may have been exposed to radiation around the plant, and Japanese news media said three workers at the facility were suffering from full-on radiation sickness.
Even if Japan manages to avoid large, uncontrolled releases of radiation that would result from a meltdown, the problems at the Fukushima facility already amounted to the worst nuclear accident in Japan’s history and perhaps the biggest malfunction at a nuclear plant since the Chernobyl disaster 25 years ago, the worst ever.
The handling of the crisis and vulnerability of Japan’s extensive nuclear facilities to earthquakes and tsunamis will also add to long-simmering grass-roots resistance against nuclear power within Japan, where people have learned to doubt the industry’s reliability as well as anodyne official statements about safety.
Even before the explosion on Saturday, officials said they had detected radioactive cesium, which is created when uranium fuel is split, an indication that some of the nuclear fuel in the reactor was already damaged — a situation sometimes referred to as a partial meltdown. How much damage the fuel suffered remained uncertain, though safety officials insisted repeatedly through the day that radiation leaks outside the plant remained small.

Although officials said the leaks did not pose a major health risk, they also told the International Atomic Energy Agency that they were making preparations to distribute iodine, which helps protect the thyroid gland from radiation exposure, to people living near Daiichi and a second nuclear plant that suffered damage in the quake, called Daini, about 10 miles away.
Worries about the safety of the two plants were worsened on Saturday because government officials and executives of Tokyo Electric Power, which runs the plant, gave confusing accounts of the causes of the dramatic midday explosion and the damage it caused. Late Saturday night, officials said that the explosion occurred in a structure housing turbines near the No. 1 reactor at the plant rather than inside the reactor itself.

The blast, apparently caused by a sharp buildup of pressure or of hydrogen when the reactor’s cooling system failed after the quake, destroyed the concrete structure surrounding the reactor but did not collapse the critical steel container inside, they said. They said that raised the chances they could continue cooling the core, and prevent the release of large amounts of radioactive material and avoid a full core meltdown at the plant.

“We’ve confirmed that the reactor container was not damaged,” Japan’s chief cabinet secretary, Yukio Edano, said in a news conference on Saturday night. “The explosion didn’t occur inside the reactor container. As such there was no large amount of radiation leakage outside. At this point, there has been no major change to the level of radiation leakage outside, so we’d like everyone to respond calmly.”

Mr. Edano said that, in addition to filling the reactor with seawater, Tokyo Electric Power workers also added boric acid to the containment vessel on Saturday night to poison the nuclear chain reaction. Mr. Edano said that the operation could “prevent criticality.”

He said radioactive materials had leaked outside the plant before the explosion, but that the explosion did not worsen the leak and that, in fact, measured levels of radioactive emission had been decreasing. He did not specify the levels of radiation involved.
Naoto Sekimura, a professor at Tokyo University, told NHK, Japan’s public broadcaster, that “only a small portion of the fuel has been melted. But the plant is shut down already, and being cooled down. Most of the fuel is contained in the plant case, so I would like to ask people to be calm.”

Japanese nuclear safety officials and international experts said that because of crucial design differences, the release of radiation at the Fukushima plant would most likely be much smaller than at Chernobyl even if the Fukushima plant had suffered a complete core meltdown, which they said it had not.

But the vulnerability of nuclear plants to earthquakes was also underscored by continuing problems at the cooling system of reactors at the second nearby plant, Daini, which prompted a evacuation of 30,000 from surrounding communities. Together, the authorities sought to move about 200,000 people around the two plants, a massive logistical task at a time when rescue workers also sought to help people trapped on injured in the earthquake.
After a full day of worries about leaking radiation at the Daiichi plant after its cooling systems malfunctioned, Tokyo Electric Power said an explosion occurred “near” the No. 1 reactor at Daiichi around 3:40 p.m. Japan time on Saturday. It said four of its workers were injured in the blast.

The decision to flood the reactor core with seawater, experts said, was an indication that Tokyo Electric and Japanese authorities had probably decided to scrap the plant, because the salt water would corrode its delicate metal innards. “This plant is almost 40 years old, and now it’s over for that place,” Olli Heinonen, the former chief inspector for the I.A.E.A., and now a visiting scholar at Harvard, said on Saturday.
Mr. Heinonen lived in Japan in the 1980s, monitoring its nuclear industry, and visited the stricken plant many times. Based on the reports he was seeing, he said he believed that the explosion was caused by a hydrogen formation, which could have begun inside the reactor core. “Now, every hour they gain in keeping the reactor cooling down is crucial,” he said.

But he was also concerned about the presence of spent nuclear fuel in a pool inside the same reactor building. The pool, too, needs to remain full of water, to suppress gamma radiation and prevent the old fuel from melting. If the spent fuel is also exposed — and so far there are only sketchy reports about the condition of that building — it could also pose a significant risk to the workers trying to prevent a meltdown in the core.
Both the Daiichi and Daini plants were shut down by Friday’s earthquake. But the loss of power in the area and damage to the plant’s generators from the subsequent tsunami crippled the cooling systems, which need to function after a shutdown to cool down nuclear fuel rods.
Malfunctioning cooling systems allowed pressure to build up beyond the design capacity of the reactors. Early Saturday, officials had said that small amounts of radioactive vapor were expected to be released into the atmosphere to prevent damage to the containment systems and that they were evacuating tens of thousands of people living around the plants as a precaution.

Those releases apparently did not prevent the buildup of hydrogen inside the plant, which ignited and exploded Saturday afternoon, government officials said. They said the explosion itself did not increase the amount of radioactive material being released into the atmosphere. But safety officials also urged people who were not evacuating but still lived relatively near the plants to cover

David Lochbaum, who worked at three reactors in the United States similar to the Fukushima design, and who was later hired by the Nuclear Regulatory Commission to teach its personnel about that technology, said that from pictures he had seen of the stricken plant, the explosion appeared to have occurred in the turbine hall, and not the reactor vessel or the containment that surrounds the vessel.

The technology used at Fukushima is called a boiling-water reactor, in which the reactor, inside a containment, sends its steam out of containment to a turbine. The turbine converts the steam’s energy into rotary motion, which turns a generator and makes electricity.
But as the water goes through the reactor, some water molecules break up into hydrogen and oxygen. A system in the turbine hall usually scrubs out those gases. Hydrogen is also used in the turbine hall to cool the electric generator. Hydrogen from both sources has sometimes escaped and exploded, he said, but in this case, there is an additional source of hydrogen: interaction of steam with the metal of the fuel rods. Operators may have vented that hydrogen into the turbine hall.

Earlier Saturday, before the explosion, a Japanese nuclear safety panel said the radiation levels were 1,000 times above normal in a reactor control room at the Daiichi plant. Some radioactive material had also seeped outside, with radiation levels near the main gate measured at eight times normal, NHK quoted nuclear safety officials as saying.
The emergency at the Daiichi plant began shortly after the earthquake struck on Friday afternoon. Emergency diesel generators, which had kicked in to run the reactor’s cooling system after the electrical power grid failed, shut down about an hour after the earthquake. There was speculation that the tsunami had flooded the generators and knocked them out of service.
For some time after the quake, the plant was operating in a battery-controlled cooling mode. Tokyo
Electric said that by Saturday morning it had also installed a mobile generator at Daiichi to ensure that the cooling system would continue operating even after reserve battery power was depleted. Even so, the company said it needed to conduct “controlled containment venting” in order to avoid an “uncontrolled rupture and damage” to the containment unit.

Why the controlled release of pressure did not succeed in addressing the problem at the reactor was not immediately explained. Tokyo Electric and government nuclear safety officials also did not explain the precise sequence of failures at the plant.
Daiichi and other nuclear facilities are designed with extensive backup systems that are supposed to function in emergencies to ensure the plants can be shut down safely.
At Daiichi, a pump run by steam, designed to function in the absence of electricity, was adding water to the reactor vessel, and as that water boiled off, the steam was being released. Such water is usually only slightly radioactive, according to nuclear experts. As long as the fuel stays covered by water, it will remain intact, and the bulk of the radioactive material will stay inside. But if fresh water cannot be pumped into the containment vessel and the cooling water evaporates, the nuclear fuel is exposed, which can result in a meltdown.

Japan, with no substantial coal or oil, relies heavily on nuclear power, which generates just over one-third of the country’s electricity. Its plants are designed to withstand earthquakes, which are common, but experts have long expressed concerns about safety standards, particularly if a major quake hit close to a reactor.

Maps: Reach of the Japanese Quake and Tsunami

2011-03-11T12:17:00.000-08:00

Damage reports

Kamaishi A tsunami more than 13 feet high struck Kamaishi and Miyako at 3:21 pm local time.

Ofunato A tsunami more than 10 feet high was observed at Ofunato Port. More than 300 houses were washed away in Ofunato city.

Kesennuma NHK TV footage showed a large ship being swept away and ramming directly into a breakwater in

Kesennuma city.

Ishinomaki A tsunami over 10 feet high was observed in Ishinomaki city and television footage showed homes being washed away.

Sendai In Sendai, the closest major city to the epicenter, the government put the official death toll at more than 300. Some 70,000 people evacuated to shelters, according to Kyodo News.

Soma At 3:50 pm on Friday, a tsunami surging higher than 24 feet struck Soma Port. Many oceanside houses were underwater.

Oarai A 14-foot tsunami hit Oarai Port at about 4:52 pm on Friday.

Tokyo Power has been cut to four million homes in and around Tokyo and several fires were seen blazing across the city. Downtown buildings shook violently during the quake.

Ichihara A large fire erupted at the Cosmo oil refinery and burned out of control with 100-foot high flames.

Japan’s Strict Building Codes Saved Lives

2011-03-11T12:00:00.000-08:00

From seawalls that line stretches of Japan’s coastline, to skyscrapers that sway to absorb earthquakes, to building codes that are among the world’s most rigorous, no country may be better prepared to withstand earthquakes than Japan.

Had any other populous country suffered the 8.9 magnitude earthquake that shook Japan on Friday, tens of thousands of people might already be counted among the dead. So far, Japan’s death toll is in the hundreds, although it is certain to rise.
Over the years, Japan has spent billions of dollars developing the most advanced technology against earthquakes and tsunamis. The Japanese, who regularly experience smaller earthquakes and have lived through major ones, know how to react to quakes and tsunamis because of regular drills — unlike Southeast Asians, many of whom died in the 2004 Indian Ocean tsunami because they lingered near the coast.

Communities along Japan’s coastline, especially in areas that have been hit by tsunamis in the past, tend to be the best prepared. Local authorities can usually contact residents directly through warning systems set up in each home; footpaths and other escape routes leading to higher ground tend to be clearly marked.

In the country that gave the world the word tsunami, Japan, especially in the 1980’s and 1990’s, built concrete seawalls in many communities, some as high as 40 feet. In addition, some coastal towns have set up networks of sensors that can sound alarms in every residence and automatically closed floodgates when an earthquake strikes to prevent waves from surging up rivers. Ports are sometimes equipped with raised platforms.

Critics of the seawalls, however, say they are eyesores and bad for the environment. The seawalls, they say, can instill a false sense of security among coastal residents and discourage them from participating in regular evacuation drills. Moreover, by blocking residents’ view of the ocean, the seawalls reduce peoples’ ability to understand the sea by observing wave patterns, critics say.
According to the national broadcaster NHK, waves from Friday’s tsunami spilled over some seawalls in the affected areas. But it was too soon to say whether other seawalls or regular evacuation drills — or a combination of the two — prevented casualty figures from climbing higher.

Devastation as Tsunami Crashes Into Japan

2011-03-11T11:54:00.000-08:00

TOKYO — An 8.9-magnitude earthquake struck off the coast of Japan on Friday, the strongest ever recorded in the country and one of the largest anywhere in the last century. The quake churned up a devastating tsunami that swept over cities and farmland in the northern part of the country and set off warnings as far away as the West Coast of the United States and South America.

Japanese police officials said that more than 200 bodies were found in Sendai, a port city in the northeastern part of the country and the closest major city to the epicenter, and the government put the official death toll at more than 300. But with many people still missing there and elsewhere, the death toll is expected to rise. A senior Japanese official said foreign countries had offered to help and Japan was prepared to seek overseas assistance.

The government evacuated thousands of residents in a two-mile radius around a nuclear plant about 170 miles northeast of Tokyo and declared a state of emergency after a backup generator failed, compromising the cooling system. So far, the chief government spokesman, Yukio Edano, said no radiation leaks had been detected. But the government announced it would begin releasing some slightly radioactive vapor to reduce pressure at the plant. One person died at a nuclear plant, according to Bloomberg News.

The earthquake and tsunami struck in deadly tandem, unleashing scenes of horror throughout northern Japan. First came the roar and rumble of the earthquake shaking skyscrapers, toppling furniture and buckling highways. Then walls of water rushed onto shore, whisking away cars and carrying blazing buildings toward factories, fields and highways.
“I never experienced such a strong earthquake in my life,” said Toshiaki Takahashi, 49, an official in the Sendai City office. “I thought it would stop, but it just kept shaking and shaking, and getting stronger.”

Train service was shut down across central and northern Japan, including Tokyo, and air travel was severely disrupted. Cellphone service and landlines were down in the affected areas.
Television images showed waves of more than 12 feet roaring inland in Japan. The floodwaters, thick with floating debris shoved inland, pushed aside heavy trucks as if they were toys. The spectacle was all the more remarkable for being carried live on television, even as the waves engulfed flat farmland that offered no resistance. The tsunami could be seen scooping up every vessel in the ocean off Sendai, and churning everything inland. The gigantic wave swept up a ship carrying more than 100 people, Kyodo News reported.

Vasily Titov, director of the Center for Tsunami Research, said that coastal areas closest to the center of the earthquake probably had about 15 to 30 minutes before the first wave of the tsunami struck. "It’s not very much time. In Japan, the public is among the best educated in the world about earthquakes and tsunamis. But it’s still not enough time.”
Complicating the issue, he added, is that the flat terrain in the area would have made it difficult for people to reach higher, and thus safer, ground. "There are not many places they could go," he said.

NHK television showed footage of a huge fire sweeping across Kesennuma, a city of more than 70,000 people in the northeast. Whole blocks appear to be ablaze. NHK also showed aerial images of columns of flame rising from an oil refinery and flood waters engulfing Sendai airport, where survivors clustered on the roof. The runway was partially submerged. The refinery fire sent a plume of thick black smoke from blazing spherical storage tanks.
Even in Tokyo, far from the epicenter, the quake struck hard. William M. Tsutsui, a professor of Japanese business and economic history at Southern Methodist University in Dallas, was getting off a bus in front of a hotel in Tokyo, where he was traveling with a business delegation, when the ground began to shake. “What was scariest was to look up at the skyscrapers all around,” he said. “They were swaying like trees in the breeze.”

Prime Minister Naoto Kan said the quake and tsunami caused major damage across wide areas.
The United States Geological Survey said the quake was the most severe worldwide since an 8.8 quake off the coast of Chile a little more than a year ago that killed more than 400. It was less powerful than the 9.1-magnitude quake that struck off Northern Sumatra in late 2004. That quake spawned a tsunami that killed more than 200,000 people around the Indian Ocean.

The survey said that Friday’s quake was centered off the coast of Honshu, the most populous of the Japanese islands, at a point about 230 miles northeast of Tokyo and a depth of about 17 miles below the earth’s surface.
The quake occurred at 2:46 p.m. Tokyo time, and was so powerful that buildings in central Tokyo, designed to withstand major earthquakes, swayed.
“This tremor was unlike any I’ve experienced previously, and I’ve lived here for eight years,” said Matt Alt, an American writer and translator living in Tokyo. “It was a sustained rolling that made it impossible to stand, almost like vertigo.”
Japanese media reported that there had been more than 70 aftershocks in the hours after the quake. Some of them were of magnitude 6.0 or greater, strong enough to do significant damage on their own.

President Obama said the United States “stands ready to help” Japan deal with the aftermath. "Michelle and I send our deepest condolences to the people of Japan,” he said in a statement. He later spoke with Mr. Kan and offered assistance.
American military airfields in Japan began accepting civilian flights diverted from airports that suffered damage, American officials said early Friday.
A spokesman for the American 7th Fleet in Japan said that Naval Air Field Atsugi had received several commercial passenger planes that could not land at Narita. Officials said that Yokota Air Base also received civilian flights. In addition, three American warships in southeast Asia will be ordered out to sea to reposition themselves in case they are directed to provide assistance, according to a 7th Fleet spokesman.

Officials around the Pacific warned residents of coastal areas to prepare for a possible tsunami, but the initial reports were of minimal to no damage in the first places that the wave reached. Relatively small tsunami waves were reported in Halmahera, Indonesia, but did little harm. Russia, China and Indonesia canceled their warnings after a few hours.
Gauges at Midway Island in the Pacific registered a wave amplitude of about five feet, according to Gerard Fryer, a geophysicist with the Pacific Tsunami Warning Center.
On Hawaii, where the tsunami hit at midmorning East Coast time on Friday, initial wave heights were about four feet above normal sea level, said Paul Huang, a seismologist with the West Coast and Alaska Tsunami Warning Center in Palmer, Alaska. Often, though, wave heights increase over time, with the second or third being the highest, he said. The center had predicted wave heights of six feet.

Television images showed survivors in a home surrounded by water, waving white sheets from the upper floors of buildings. News reports said the earthquake had forced the Tokyo subways to empty while airports were closed. Many residents set off on epic journeys home, walking for miles across a vast metropolitan area. In a video posted on YouTube, rumbles shook a supermarket as shopkeepers rushed to steady toppling wares and the classical music soundtrack played on.
Initial television coverage from coastal areas showed very few people actually in the water. The initial impact of the wave seemed to have been enormous, tipping two huge cargo vessels on their sides at one port and tearing others from their moorings.
Smaller vessels, including what looked like commercial fishing trawlers, were carried inland, smashing into the superstructure of bridges as the waters surged. Public broadcaster NHK reported that a large ship swept away by the tsunami rammed directly into a breakwater in Kesennuma city in Miyagi prefecture. Video footage also showed buildings on fire in the Odaiba district of Tokyo, The Associated Press reported.

A second major earthquake of 7.4 magnitude was reported as aftershocks shook the region. Japanese media reported mobile phone networks were not working.
Power blackouts were affecting about 2 million residents around Tokyo alone, the government said. Cell phone service was severely affected across central and northern Japan as residents rushed to call friends and relatives as aftershocks struck.

The quake occurred in what is called a subduction zone, where one of the Earth’s tectonic plates is sliding beneath another. In this case, the Pacific plate is sliding beneath the North American plate at a rate of about 3 inches a year. The earthquake occurred at a depth of about 15 miles, which while relatively shallow by global standards is about normal for quakes in this zone, said Emily So, an engineer with the United States Geological Survey in Golden, Colo.
Ms. So said that according to her agency’s calculations, the quake was of magnitude 8.9. It had been preceded by what seismologists call foreshocks — smaller quakes in the same area. The largest of these was a magnitude 7.2 quake two days before, centered about 25 miles south of the spot where the earthquake struck Friday.

In a subduction quake that occurs underwater, as this one did, the sudden movement of a portion of one of the plates can displace enormous amounts of water, triggering a tsunami. As the tsunami waves approach shallow coastal areas, they tend to increase in height.
The devastation often comes from a succession of waves, with the first few being relatively small. The waves can propagate across oceans at speeds of 500 miles an hour or greater. With Friday’s quake occurring only about 80 miles offshore, people in the closest coastal areas would not have had much time to evacuate.

Defense Secretary Robert M. Gates was briefed on the disaster during a trip to Brussels. Geoffrey Morrell, the Pentagon press secretary, said there were no reports of damage to American military facilities or naval vessels.

The Hang Seng index in Hong Kong and the Straits Times in Singapore slumped after news of the quake, ending about 1.6 percent and 1 percent down, respectively.

Emergency Declared at Japanese Nuclear Plant

2011-03-11T11:45:00.000-08:00

The Japanese government declared an “atomic power emergency” and evacuated thousands of residents living close to a nuclear plant in northern Japan after a major earthquake, but officials said there had been no radiation leak from the facility and that problems with its cooling system were not critical.

Some 3,000 people were told to leave a 2-mile radius around the Fukushima No. 1 plant, operated by Tokyo Electric Power and located in Fukushima Prefecture, after a mechanical failure in the cooling system, government officials said.
The plant is designed to shut down safely after an earthquake, but its emergency diesel generators, needed to run water pumps, were not working. American experts on reactors of the Fukushima design said, though, that technicians at the plant would have several hours to restore power before any significant damage resulted.

Japan’s nuclear safety agency said pressure inside one of six boiling water reactors at the Fukushima Daiichi plant had risen to 1.5 times the level considered normal, according to The Associated Press. To reduce the pressure, slightly radioactive vapor would be released, the news agency said, but it was not immediately clear if it was going to be released into the containment building or the atmosphere. The agency said the radioactive element in the vapor would not affect human health.
The evacuation was described as precautionary. Near midnight Japan time on Friday, Jiji Press, a Japanese news agency, quoted Trade Ministry officials as saying that the cooling system would be reactivated and should resume normal operations.
Japan relies heavily on nuclear power, and it generates just over a third of the country’s total electricity. The facilities are designed to withstand earthquakes, which are common in Japan, but experts have long expressed concerns about safety standards at the plants, particularly about the impact a major quake could have if it hit close to a reactor.

At least two other Japanese nuclear plants also reported trouble, but there was no radiation leak at either of them, government officials said. A number of nuclear reactors around the hardest-hit area of the country were shut down, and Japanese news media said a fifth of the country’s total nuclear generating capacity was offline because of the quake.
One major concern is that while operators can quickly shut down a nuclear reactor in an earthquake or another emergency, they cannot allow the cooling systems to stop working. Even after the plant’s chain reaction is stopped, its fuel rods still produce heat. The production of heat drops off sharply over the following hours, but continued cooling is needed, or the water will boil away and the fuel will melt, releasing the uranium fragments inside.

Heat from the nuclear fuel rods must be removed by water in a cooling system, but that requires power to run the pumps and to align the valves in the pipes. So the plant requires a continuous supply of electricity even after the reactor stops generating its own power.
An analyst with the World Nuclear Association, a major international nuclear power group, told Reuters that he understood fresh cool water was now being pumped into the cooling system at Fukushima, reducing the threat of a meltdown.
“We understand this situation is under control,” the analyst said, adding that he understood that a back-up battery power system had been brought online after about an hour and began pumping water back into the cooling system, where the water level had been falling.
Japanese news media quoted officials in Fukushima Prefecture as saying that water levels were 3.4 meters — about 10 feet — above the fuel rods at the No. 2 reactor at the plant. Tokyo Electrical Power officials confirmed that water levels had been falling but said that fuel roads had not been exposed.

Civilian power reactors are designed with emergency diesel generators to assure the ability to continue cooling even during a blackout. Many reactors have two, assuring redundancy; some have three, so that if one must be taken out of service for maintenance, the plant can still keep running.
It was not immediately clear how many there are at Fukushima, but the operators reported earlier in the day that they were not working, prompting the evacuation.
Fukushima 1, which was designed by General Electric and entered commercial service in 1971, was probably equipped to function for some hours without emergency diesel generators, according to David Lochbaum, who worked at three American reactor complexes that use General Electric technology.

Mr. Lochbaum, who also worked as an instructor for the Nuclear Regulatory Commission on GE reactors, said he did not know the details of Fukushima, but that such reactors were equipped to ride out interruptions in electrical power by using pumps that could be powered by steam, which would still be available in case of electric power failure. Valves can be opened by motors that run off batteries, he said. Older plant designs, of the era of Fukushima, generally have batteries sized to operate for four hours, he said.
After four hours, heat production in the core is still substantial but has been reduced, he said. The heat would boil away the cooling water, raising pressure in the reactor vessel, until automatic relief valves opened to let some of the steam out. Then the valves would close and the pressure would start building again.

If the cooling system remains inoperative for many hours, the water would eventually boil away, he said, and the fuel would begin to melt. That is what happened at Three Mile Island, the reactor near Harrisburg, Pa., that suffered a partial core melt in March 1979. In that case the cause was not an earthquake, but mechanical failure, operator error and poor design, government investigators later found.
Mr. Lochbaum, who now works for the Union of Concerned Scientists, a group that is very often critical of nuclear safety standards, said that if the cooling water in the vessel was boiling away, the process of boiling enough to expose the fuel would take “hours, not minutes.”

The radioactive steam — which would become far more radioactive as the fuel began to melt — would fill the containment building, he said. That building is designed to be cooled, to keep down steam pressure and leaks. But those pumps require the main sources of power at the plant to function properly.

“If they start melting fuel, the containment integrity is going to the key in terms of what gets out,” Mr. Lochbaum said. “Their focus now has to be on getting back A.C. power” — or the main power supplies for the plant.

Japanese Firms Assess Effects of Earthquake

2011-03-11T09:58:00.000-08:00

Companies in Japan evacuated and closed plants on Friday as they scrambled in the aftermath of a powerful earthquake and tsunami that struck the northeastern part of the country.

As aftershocks continued Friday, many company executives were trying to assess possible damage and determine what the long-term effect on their operations might be.
“There are car and semiconductor factories in northern Japan, so there will be some economic impact due to damage to factories,” Yasuo Yamamoto, senior economist at Mizuho Research Institute in Tokyo, told Reuters.
Any disruptions in Japan’s exports will inevitably ripple through an economy that has stagnated over the last two decades. Japan’s gross domestic product fell 0.3 percent in the October-December quarter as the end of generous government incentives on environmentally friendly cars resulted in a temporary decline in spending. At an annualized rate, Japan’s economy shrank 1.1 percent in the fourth quarter from the previous quarter.

All Japanese ports were closed, shippers said Friday, though the shutdowns may be precautionary. The country’s major container seaports, most of them south of Tokyo, play a crucial role in Japan’s export-driven economy. Japanese exports — chiefly automobiles, machinery and manufactured goods — rose by almost a quarter in 2010, the first increase in three years, and a lengthy shutdown could create costly delays up and down the global supply chain. Reuters reported that several airports, including Tokyo’s Narita, were closed.
Numerous airlines diverted flights away from the affected area, and the airport in the city of Sendai was flooded by a tsunami that followed the quake, according to the Japanese television broadcaster NHK.

The Japanese central bank said on its Web site that it would “do its utmost,” including providing extra liquidity, to ensure financial market stability.
Over all though, the real bulk of industrial Japan appeared to have been spared, said an economist in Hong Kong, who had been in touch with his colleagues in Japan but asked not to be identified as he was not authorized by his bank to talk about Japan.
“Inevitably there will be microeconomic disruptions, as there were after Kobe and even Chuetsu,” Richard Jerram, chief Asia economist at Macquarie, wrote in a research note, referring to other powerful earthquakes that had hit Japan in recent years. “However, many firms reportedly diversified supply chains in the wake of Kobe, so the impact should be lower.”
Most automakers halted production at assembly plants in the affected areas.
One worker died and more than 30 were injured when walls and parts of a ceiling crumbled at a Honda Motor research facility in northeastern Tochigi prefecture, The Associated Press said, attributing the report to the company. Production at two Honda plants was halted, but resumed shortly afterward at one.

Nissan Motor halted production at five of its plants in northeastern Japan and in the Yokohama area near Tokyo, The A.P. reported. It said two workers were slightly injured at its Tochigi plant and its technical center in Kanagawa prefecture, near Tokyo.
Toyota, headquartered near the southern port of Nagoya, said in a statement that no injuries had been reported at its operations, though a total of four plants in the north and northeast — in Hokkaido, Tohoku and Miyagi — had been shutdown. Other plants, the statement said, were back in operation, but the company was still evaluating possible disruptions to its supply chain.
A representative for Sony, headquartered in Tokyo, said the company had shut down its six northern plants — which make Lithium-ion batteries and Blu-Ray parts — and evacuated its employees there. No injuries were reported. Numerous other companies said they were still assessing possible damage; many others could not be reached for comment.

The Associated Press reported that the Cosmo Oil refinery outside of Tokyo was burning out of control with 100-foot flames whipping into the sky. Several nuclear power stations were shut down, according to media reports.
Miyagi, the prefecture that is home to Sendai and the areas most affected by the quake, accounts for 1.7 percent of the Japanese population and the same proportion of gross domestic product, while the region of Tohoku as a whole is about 8 percent of G.D.P., Mr. Jerram estimated. Initial reports suggested that Tokyo, the financial center of the country, had not been badly damaged, he added.

The region hit by the tsunami is known for growing rice, and other rice-growing areas around the Pacific Rim may see coastal flooding at a time of already rising world food prices.
But Ben Savage, the managing director for rice at Jackson Son & Company in London, one of the world’s oldest rice brokerage houses, said that the tsunami was unlikely to have much of an effect on global rice prices because rice tends to be fairly tolerant of the temporary ingress of salt water into paddies.

A separate concern is that many areas immediately adjacent to the ocean are now used for aquaculture of shrimp and fish and may be damaged, Mr. Savage said.
“The biggest problems tend to be infrastructure, roads and rail,” said Janet Hunter, who teaches Japanese economics at the London School of Economics. “Almost everything is going to have to be replaced” that fell in the path of the tsunami.
Christopher Gerteis, an expert in contemporary Japan at the School of Oriental and Asian Studies in London, said the region largely depended on local fisheries for their food, and that the cost of reconstruction would include reclaiming the fishing fleet.
One of the few things that was immediately clear was that investors were deeply unsettled by the disaster, which took place just as the Japanese economy had begun to gather some steam.
However, many economists also caution that economic activity remained feeble, plagued by deflation, high government debt, and an aging population — factors that contributed to the decision by the ratings agency Standard and Poor’s to downgrade Japan’s credit rating earlier this year.

The Japanese stock market had very little time to react to the quake, which occurred shortly before the end of the trading day in Tokyo.
The Nikkei 225 index, which had already been lower before the quake, ended down 1.7 percent for the day. Bond futures surged amid the uncertainty, though the yen quickly rebounded after initially dipping against the dollar as news of the quake came out.
“The last major earthquake to hit Japan was the Great Hanshin Earthquake which hit Kobe on Jan. 17th 1995,” Geoffrey Yu, a currency analyst at UBS in London, wrote Friday. The quake caused more than $100 billion in damage, but dollar-to-yen index fell over 20 percent in the following three months.

“There is reason to believe this time the reaction would be similar,” Mr. Yu said.
He noted that the insurance companies, though clearly implicated by the quake, might receive government backing.

Mr. Yu wrote that when aggregate claims exceed 1 trillion yen, the government takes on a much larger share of the cost, while insurers pay only a fraction. The damages wrought from the quake and its aftermath, he said, were likely to surpass that.
He said that damages from the Kobe quake had been mitigated by low levels of coverage at the time, conditions that may well apply in the latest earthquake

Updates and Video of the Quake and Tsunami, in Japan and Elsewhere

2011-03-11T09:50:00.000-08:00

Qaddafi Forces Bear Down on Strategic Town as Rebels Flee

2011-03-11T09:46:00.000-08:00

RAS LANUF, Libya — The momentum shifted decisively Thursday in an uprising that has shaken Col. Muammar el-Qaddafi’s four decades of rule, as rebels fled from this strategic refinery town under a sustained land, air and sea assault by government forces.

The fighting was a stark illustration of the asymmetry of the conflict, pitting protesters turned rebels against a military with far superior arms and organization and a willingness to prosecute a vicious counterattack against its own people.
Usually ebullient rebels acknowledged withdrawing Thursday, even as the fledgling opposition leadership in Benghazi scored diplomatic gains with France’s recognition of it as the legitimate government and senior American officials’ promise to talk with its leaders.

“We are coming,” Colonel Qaddafi’s son, Saif al-Islam, told reporters in Tripoli.
Western nations took new steps to isolate the Qaddafi government, but the measures stopped well short of any sort of military intervention and seemed unlikely to be able to reverse the momentum.
The cautious response underscored what is at stake in a race against time in the most chaotic and unpredictable of the uprisings to shake the Arab world — whether the opposition can secure more international recognition and a no-flight zone to blunt Colonel Qaddafi’s offensive before rebel lines crumble in the coastal oil towns west of Benghazi.
“It’s tough these days,” said Mohammed al-Houni, a 25-year-old fighter at the front. “There is no comparison between our weapons and theirs. They’re trained, they’re organized. They got their training in Russia and I don’t know where. We’re not an army, we’re the people and even if we had weapons, we wouldn’t even know how to use them.”

Only days ago, rebels were boldly promising to march on Surt, Colonel Qaddafi’s hometown, then on to Tripoli, where opposition leaders predicted its residents would rise up. But the week has witnessed a series of setbacks, with a punishing government assault on Zawiyah, near the capital, and a reversal of fortunes in towns near Ras Lanuf, whose refinery makes it a strategic economic prize in a country blessed with vast oil reserves.
There was a growing sense among the opposition, echoed by leaders in opposition-held Benghazi and rebels on the front, that they could not single-handedly defeat Colonel Qaddafi’s forces.
“We can’t prevail unless there’s a no-fly zone,” said Anis Mabrouk, a 35-year-old fighter. “Give us the cover and we’ll go all the way to Tripoli and kill him.”

That seemed unlikely, though. Even without warplanes, Colonel Qaddafi’s government could still marshal far superior tanks, armor and artillery, along with the finances and organization to prosecute a counteroffensive. Given the disarray, some rebels took pride in their success in holding the lines at Ras Lanuf as long as they had. Soviet-made warplanes struck Brega, more than 100 miles from the front line on the road that resupplies the rebels, as well as several spots on the way to Ras Lanuf.

At noon, a rocket slammed into an unfinished mosque there, sending clouds of dust over dozens of worshipers and incensing fighters who condemned it as a sacrilege.
“God is greater than the bombs!” people recalled shouting after the rocket detonated. “God is greater than Muammar el-Qaddafi. God is greater than any criminal!”
From the minaret, the mosque’s loudspeaker, unsilenced by the attack, blared the words of the cleric. “When you side with God,” he intoned, “he will support you.”
At the same time, a bomb detonated just yards from the hospital, unleashing scenes of chaos. Fighters shot randomly — and ineffectually — into clear skies, sirens howled and two ambulances speeding from the hospital crashed into each other. Doctors and staff evacuated the hospital, leaving behind the body of a civilian who they said was shot in the head by snipers loyal to Colonel Qaddafi’s forces firing from the beach.

“We only die once,” Hweidi Trabulsi shouted, trying to rally his fellow fighters, dressed in a mishmash of berets, camouflage and track suits. But his pleas fell on deaf ears, as rebels scrambled to fall back to a makeshift checkpoint at the edge of town.
Scores of trucks fled down the coastal road, barreling past the largely deserted refinery and fighters praying on pieces of cardboard that read, “Fresh vegetables.” Shell casings fell off a pickup bed, as the vehicle lurched ahead. Passing it was a truck with a gun mounted in back, vainly camouflaged with a few branches of a eucalyptus tree.
“Everyone is targeted,” said Salem Langhi, an orthopedic surgeon helping with the evacuation. “We have no idea what they’re bombing. Chaotic? Yes, this is chaos.”
In Benghazi, Abdel-Hafidh Ghoga, the deputy leader of the Libyan National Council, a kind of government in waiting, said reports of Ras Lanuf’s fall were not accurate. An opposition spokesman, Essam Gheriani, said even if the reports were true, “It’s not a permanent setback.” He contended that the attack on the city was joined by Libyan Navy ships and commercial vessels carrying artillery. The reality of Ras Lanuf’s fate was more ambiguous. Even though rebels pulled back from the city, it did not appear that government forces had actually entered.

As each day passes, anger among the rebels grows at what they have described as inaction on the part of the international community and in particular, the United States.
“Obama and Qaddafi are the same!” one fighter, Mohamed Mgaref, shouted at a medical clinic about an hour from the front, as ambulances ferried some of the four dead and dozens wounded in the fighting. More scenes of chaos unfolded there. “Clear the way!” volunteers shouted as ambulances swerved into the clinic’s driveway. At each rumor of an airstrike, people fled for cover. “Spread out,” one man shouted at them.
In a rare piece of encouraging news for the opposition, France on Thursday became the first country to recognize the opposition leadership and said it would soon exchange ambassadors with the movement in Benghazi. The move put France ahead of the United States and other European powers seeking ways to support the opposition.
France’s stance was viewed as a savvy gesture to show commitment to the uprisings and wave of protests in the Middle East and North Africa after President Nicolas Sarkozy admitted Paris was slow to recognize the strength of the movements in Egypt and Tunisia. It might also position France favorably in future oil deals if the opposition movement somehow manages to expel Colonel Qaddafi and take control of the country.

Libyan officials denounced the move as “illegal and illegitimate.”
“All the options will be considered in our response,” Khalid Kaim, the deputy foreign minister, said in a news conference in Tripoli after the decision was announced, including Libya’s withdrawing recognition for France.

The Committee to Protect Journalists said that at least seven journalists in Libya were unaccounted for. The most recent to vanish was Ghaith Abdul-Ahad, a correspondent for The Guardian newspaper, whose disappearance was reported Thursday.
Mr. Abdul-Ahad was last known to be on the outskirts of Zawiyah, near Tripoli, scene of some of the heaviest fighting between rebels and Colonel Qaddafi’s forces.

Huge Quake and Tsunami Hit Japan

2011-03-11T09:39:00.000-08:00

The government evacuated thousands of residents in a two-mile radius around a nuclear plant about 170 miles northeast of Tokyo and declared a state of emergency after a backup generator failed, compromising the cooling system. So far, the chief government spokesman, Yukio Edano, said no radiation leaks had been detected.
Prime Minister Naoto Kan said the quake and tsunami caused major damage across wide areas.
The United States Geological Survey said the quake was the most severe worldwide since an 8.8 quake off the coast of Chile a little more than a year ago that killed more than 400. It was less powerful than the 9.1-magnitude quake that struck off Northern Sumatra in late 2004. That quake spawned a tsunami that killed more than 200,000 people around the Indian Ocean.
The survey said that Friday’s quake was centered off the coast of Honshu, the most populous of the Japanese islands, at a point about 230 miles northeast of Tokyo and a depth of about 17 miles below the earth’s surface.

The quake occurred at 2:46 p.m. Tokyo time, and was so powerful that buildings in central Tokyo, designed to withstand major earthquakes, swayed.
“This tremor was unlike any I’ve experienced previously, and I’ve lived here for eight years,” said Matt Alt, an American writer and translator living in Tokyo. “It was a sustained rolling that made it impossible to stand, almost like vertigo.” Japanese media reported that there had been more than 70 aftershocks in the hours after the quake. Some of them were of magnitude 6.0 or greater, strong enough to do significant damage on their own.
President Obama said the United States “stands ready to help” Japan deal with the aftermath. "Michelle and I send our deepest condolences to the people of Japan,” he said in a statement. He later spoke with Mr. Kan and offered assistance.
American military airfields in Japan began accepting civilian flights diverted from airports that suffered damage, American officials said early Friday.
A spokesman for the American 7th Fleet in Japan said that Naval Air Field Atsugi had received several commercial passenger planes that could not land at Narita. Officials said that Yokota Air Base also received civilian flights. In addition, three American warships in southeast Asia will be ordered out to sea to reposition themselves in case they are directed to provide assistance, according to a 7th Fleet spokesman.

Officials around the Pacific warned residents of coastal areas to prepare for a possible tsunami, but the initial reports were of minimal to no damage in the first places that the wave reached. Relatively small tsunami waves were reported in Halmahera, Indonesia, but did little harm. Russia, China and Indonesia canceled their warnings after a few hours.
Gauges at Midway Island in the Pacific registered a wave amplitude of about five feet, according to Gerard Fryer, a geophysicist with the Pacific Tsunami Warning Center.

On Hawaii, where the tsunami hit at midmorning East Coast time on Friday, initial wave heights were about four feet above normal sea level, said Paul Huang, a seismologist with the West Coast and Alaska Tsunami Warning Center in Palmer, Alaska. Often, though, wave heights increase over time, with the second or third being the highest, he said. The center had predicted wave heights of six feet.
Television images showed waves of more than 12 feet roaring inland in Japan. Cars and trucks were still moving on highways as the water rushed toward them.
The floodwaters, thick with floating debris shoved inland, pushed aside heavy trucks as if they were toys, in some places carrying blazing buildings toward factories, fields, highways, bridges and homes. The spectacle was all the more remarkable for being carried live on television, even as the waves engulfed flat farmland that offered no resistance.
The force of the waves washed away cars on coastal roads and crashed into buildings along the shore.

NHK television transmitted aerial images of columns of flame rising from an oil refinery and flood waters engulfing Sendai airport, where survivors clustered on the roof of the airport building. The runway was partially submerged. The refinery fire sent a plume of thick black smoke from blazing spherical storage tanks.
The images showed survivors in a home surrounded by water, waving white sheets from the upper floors of buildings. News reports said the earthquake had forced the Tokyo subways to empty while airports were closed and many residents took to the streets.
Initial television coverage from coastal areas showed very few people actually in the water. The initial impact of the wave seemed to have been enormous, tipping two huge cargo vessels on their sides at one port and tearing others from their moorings.
Smaller vessels, including what looked like commercial fishing trawlers, were carried inland, smashing into the superstructure of bridges as the waters surged. A senior Japanese official said foreign countries had offered to help and Japan was prepared to seek overseas assistance.
Japanese television showed major tsunami damage in northern Japan. Public broadcaster NHK reported that a large ship swept away by the tsunami rammed directly into a breakwater in Kesennuma city in Miyagi prefecture. Video footage also showed buildings on fire in the Odaiba district of Tokyo, The Associated Press reported.
“It just seemed to go on and on,” Katherine Wallace, who was in an office building in Tokyo when the quake struck, told the BBC.

A second major earthquake of 7.4 magnitude was reported as aftershocks shook the region. Japanese media reported mobile phone networks were not working.
Power blackouts were affecting about 2 million residents around Tokyo alone, the government said. Cell phone service was severely affected across central and northern Japan as residents rushed to call friends and relatives as aftershocks struck.
“I never experienced such a strong earthquake in my life,” said Toshiaki Takahashi, 49, an official in the Sendai City office. “I thought it would stop, but it just kept shaking and shaking, and getting stronger.”

The quake occurred in what is called a subduction zone, where one of the Earth’s tectonic plates is sliding beneath another. In this case, the Pacific plate is sliding beneath the North American plate at a rate of about 3 inches a year. The earthquake occurred at a depth of about 15 miles, which while relatively shallow by global standards is about normal for quakes in this zone, said Emily So, an engineer with the United States Geological Survey in Golden, Colo.
Ms. So said that according to her agency’s calculations, the quake was of magnitude 8.9. It had been preceded by what seismologists call foreshocks — smaller quakes in the same area. The largest of these was a magnitude 7.2 quake two days before, centered about 25 miles south of the spot where the earthquake struck Friday.
In a subduction quake that occurs underwater, as this one did, the sudden movement of a portion of one of the plates can displace enormous amounts of water, triggering a tsunami. As the tsunami waves approach shallow coastal areas, they tend to increase in height.
The devastation often comes from a succession of waves, with the first few being relatively small. The waves can propagate across oceans at speeds of 500 miles an hour or greater. With Friday’s quake occurring only about 80 miles offshore, people in the closest coastal areas would not have had much time to evacuate.

Defense Secretary Robert M. Gates was briefed on the disaster during a trip to Brussels. Geoffrey Morrell, the Pentagon press secretary, said there were no reports of damage to American military facilities or naval vessels.
At the headquarters of the Navy’s Seventh Fleet in Yokosuka, Japan, sailors were preparing for a potential tsunami. “We’ve issued instructions to our pierside ships in Yokosuka to stand by their lines to be prepared to quickly adjust them as necessary to prevent damage during any resulting tsunami,” said Cmdr. Jeff Davis, the Seventh Fleet spokesman.

The Hang Seng index in Hong Kong and the Straits Times in Singapore slumped after news of the quake, ending about 1.6 percent and 1 percent down, respectively.

Crisis Is Over, but Where’s the Fix?

2011-03-10T13:23:00.000-08:00

WASHINGTON — When the financial system began to crumble more than three years ago, the world rushed to rescue it. Country after country went deeply into debt to keep banks afloat and prevent a deep recession from turning into something worse.
It worked. This week was the second anniversary of the nadir of the crisis. Most stock markets around the world are at least 75 percent higher than they were then. Financial stocks, which led the markets down, have also led them up.

At the time, rescuing seemed more important than reforming. The world economy was breaking down because of a lack of financing. Trade flows collapsed, and companies and individuals stopped spending. It seemed clear that halting the slide was critical.
But the world has changed since then. The economic recovery in most developed countries is stuttering at best, and governments are struggling with their own finances. It is time for remorse and second-guessing.
A surprising citadel of that second-guessing is at the International Monetary Fund, where researchers this week concluded that the rescues “only treated the symptoms of the global financial meltdown.”

The researchers, Stijn Claessens and Ceyla Pazarbasioglu, warned that “a rare opportunity is being thrown away to tackle the underlying causes. Without restructuring financial institutions’ balance sheets and their operations, as well as their assets — loans to over-indebted households and enterprises — the economic recovery will suffer, and the seeds will be sown for the next crisis.”
There have been reforms, of course. The Dodd-Frank law in the United States is now being put into effect, albeit by regulators that the new Republican majority in the House of Representatives seems determined to starve of resources to do the job. Banking regulators around the globe have agreed that much more capital is needed by banks, but stricter requirements are coming very slowly out of fear that abrupt changes will reduce bank lending when it is needed the most.
More capital is clearly needed, but it may not be nearly enough. “If we ask them for more capital, and they are too big to fail, they can take even more risk” after they raise additional capital, Y. Venugopal Reddy, a former governor of India’s central bank, argued at an economic conference sponsored by the I.M.F. this week. He added that he was worried about institutions that were “too powerful to regulate.”

One of the questions economists were asked to address at the conference was, Does the financial system have social value?

A few years ago, that question would not have been asked at the International Monetary Fund. If it had been, the responses would have been as unanimous as might be expected if a gathering at the Vatican were to consider whether religion was a good thing.
Now, there is no such unanimity. It is clear that there are functions of the financial system that must be performed, among them the allocation of capital and the setting of prices. But there is at least a suspicion that a significant part of modern finance has no real value for anyone except the participants.

Adair Turner, the chairman of Britain’s Financial Services Authority, spoke with wonderment of the huge volume of stock trades now made by computers using algorithms to rapidly trade in and out. Some traders, he said, were using what they called “predatory algorithms,” whose sole purpose is to exploit a weakness in some other trader’s algorithm and get it to make an unprofitable trade.
“It is quite difficult to work out the social benefit of that,” he said.
And of course, there is also the fact that the financial system did not accomplish what it was supposed to do. “At the core of these functions is the ability to find and set the right price, including the extent to which it reflects risk,” Antonio Borges, an I.M.F. official and former vice chairman of Goldman Sachs International, told the conference. “This is not really a question of financial sophistication, of complex products or greedy bankers. It is a question of getting the prices wrong.”

He added, “It is unbelievable how wrong they were.”
There is general agreement that many of the assumptions economists and others made before the crisis — about the rationality of markets, about their ability to measure risks and about the proper role of monetary policy — were largely wrong, or at best oversimplified. But there is far less unanimity about what to do about it. International cooperation was impressive in dealing with the immediate crisis. Now it is splintering, and banks are threatening to move operations to areas they deem friendlier to them.

In retrospect, it is clear that the bailouts came with too little pain for those responsible.
Bondholders who financed banks that failed largely escaped pain. That was true even in Ireland, where the bailout would have led to a default of government debt had Europe not stepped in. It is still not clear how Ireland will pay its national debt, but the bank bondholders did fine.
At the time, of course, there were fears that forcing bondholders to suffer would lead to the collapse of banks that could have survived. Those fears seemed reasonable to me then, and still do.

But little progress has been made in setting up mechanisms to assure that any future crisis can be dealt with in a different way. There is talk of restructuring bank balance sheets to assure that debt is automatically converted to equity just when equity seems to be worth little, but that is unlikely to happen unless regulators force it, and it is far from clear what price investors would demand.

Oil Falls on Demand Worries

2011-03-10T13:22:00.000-08:00

NEW YORK (AP) — Energy prices fell Thursday as economists said the recent surge in fuel prices will eventually hurt the fragile economic recovery.

Here's a breakdown of how energy contracts traded Thursday:
On the New York Mercantile Exchange:
Crude: lost $1.68 to settle at $102.70 per barrel;
Gasoline: dropped less than a penny to settle at $3.0196 per gallon;
Heating oil: fell 2.58 cents to settle at $3.0449 per gallon;
Natural gas: gave up 10 cents to settle at $3.83 per 1,000 cubic feet.
On the ICE futures exchange:
Brent crude: lost 51 cents to settle at $115.43 per barrel.

Renault Affair Goes From Satirical to Farcical to Possible Tragedy

2011-03-10T13:21:00.000-08:00

PARIS — The extraordinary charges shook the French business establishment: Renault, the automaker, said in January that three of its employees had been caught trying to sell its electric car secrets overseas. So confident was the company of its case that it fired the three and filed criminal charges. Carlos Ghosn, the chief executive, went on television saying he had seen proof of the men’s guilt.

But the affair appears to have turned from the sensational to the farcical — and now threatens to become a tragedy. Renault is climbing down from its accusations amid doubts about key evidence, creating a possibility that heads will roll amid deep embarrassment in the French establishment.
Like BP, which found its corporate image splattered by the Gulf of Mexico oil spill last year, Renault may soon be looking for new people for its executive suite. Finance Minister Christine Lagarde of France has pointedly called on management to “take all the consequences” in the case.
The investigation is not over yet, and new evidence could still turn up to implicate the men. But Renault no longer talks of certainty. Patrick Pélata, the chief operating officer, on Wednesday told the French daily Le Figaro that “a certain number of factors lead us to doubt” the previous assertions.

At issue is the evidence on which the charges rest: The Swiss and Liechtenstein bank accounts the men were alleged to have created to channel the wages of spying have not been found, even though a secret source had supposedly provided detailed information.
Adding to the mystery, Renault’s own security officials, who — with the aid of a contact in Algeria — carried out the company’s internal investigation after the men were anonymously denounced, have refused to divulge to either French intelligence or the company their source for the account data.

Le Canard Enchaîné, a French satirical weekly, reported Wednesday that the company had paid that source €250,000, or about $345,000, for the initial information, a fact confirmed by the company. Renault said it did not know whom the funds were intended for.
Jean Reinhart, a Renault lawyer, said Wednesday on France Inter radio that he expected the investigation to conclude by the end of March.
Xavier Thouvenin, a lawyer for one of the accused men, said the latest revelations suggested Renault had fallen for a con artist who played on the company’s fears. “Whoever was behind it got a little greedy,” Mr. Thouvenin said. “He went after three guys who didn’t just lie down. They said, ‘We’re going to fight this till the end; we’re innocent.”’

He added: “Now Renault is claiming they’re the victim, but they’re also basically saying they never had any documents, no evidence. They had nothing. Can you imagine firing someone for something like this and not even checking?”
Renault filed a criminal complaint for “organized industrial espionage, corruption, breach of trust, theft and concealment.” At the time, a member of the French Parliament spoke darkly of a “Chinese lead” in the case — drawing a chilly response from Beijing — and called for stronger measures to protect national corporate secrets.

The espionage was supposedly aimed at the company’s electric car program, an area where Renault and its Japanese ally, Nissan Motor, are seeking to establish themselves as the global leader.
But there were signs of problems with the case. To begin with, French government officials, who have a major voice in the company because the state still owns 15 percent of its shares, were furious that Renault had not alerted them or the domestic intelligence service to the case until the automaker had already suspended the three men on Jan. 3. Further, intelligence officials expressed doubt that Renault had the resources at its disposal to investigate in just a few months the complex web of international money transfers through offshore financial centers that it claimed to have discovered.

And all of the men strongly protested their innocence, taking their case to the media and filing defamation suits against the unknown party that had accused them. The three are Michel Balthazard, a member of the management committee and a veteran of more than 30 years with Renault; Bertrand Rochette, Mr. Balthazard’s assistant; and Matthieu Tenenbaum, a former deputy director of the electric car program.

Mr. Pélata, No.2 behind Mr. Ghosn, said during an interview last week with Le Figaro that he would resign if the accusations proved to be false. But Mr. Ghosn’s position could also be in jeopardy. Though he is one of the few chief executives of a French company with worldwide name recognition, he is also among the highest paid, and the French government has not been altogether happy with what it sees as Mr. Ghosn’s emphasis on producing overseas.
Caroline de Gézelle, a company spokeswoman, said neither Mr. Ghosn nor Mr. Pélata were currently available for interviews. “We’re waiting for the prosecutor to conclude his investigation,” she said. “Justice will be done. If indeed these people are innocent, the company could offer them to be reintegrated. It is too soon to say, there are a lot of possibilities that need to be discussed.”

Mr. Tenenbaum said during an interview in January that he wanted nothing more than to return to his job at Renault.
But Mr. Balthazard told Le Figaro this week that the experience had been “horrible.”
“I saw from this affair the total lack of confidence management had in me,” Mr. Balthazard added. “And to go back to a place where people all wrote me off as guilty is simply unimaginable. There’s no going back to Renault.”

Sheen Files Suit Against Lorre and Warner

2011-03-10T13:20:00.000-08:00

Lawyers representing the actor Charlie Sheen escalated the war between the actor and Chuck Lorre, the creator of his hit comedy “Two and a Half Men” and Warner Brothers, the studio that produces it, by filing a suit Thursday demanding more than $100 million in damages for first stopping production on episodes planned for this season and then removing him unjustly from the show.

The suit, which was obtained and posted by the celebrity gossip Web site TMZ, is in response to the decision earlier this week to fire Mr. Sheen from the comedy citing both his behavior, which has included drug use and accusations of violent incidents with women, and his comments about Mr. Lorre and Warner executives.

Mr. Sheen’s chief lawyer, Martin D. Singer, filed the suit Thursday in Superior Court in Los Angeles. In it, he goes on the attack especially against Mr. Lorre, saying the producer first stopped production on the series and then forced Warner Brothers to terminate Mr. Sheen’s employment “to serve his own ego and self-interest.”

Despite the fact that Mr. Lorre himself stood to make many more millions of dollars if the show had completed the eight episodes of the show eliminated when production was halted, the suit claims that the producer refused to write and supervise production on those episodes out of an “egotistical desire to punish Mr. Sheen” and because he had better financial arrangements on two other comedies he produces for Warner Brothers.

The suit labels Mr. Lorre “the proverbial 800-pound gorilla” who could make the studio do anything he wished. Warner Brothers declined comment Thursday afternoon, as did Mr. Lorre.
The action by Mr. Sheen’s legal team ratchets up one of the most fierce legal battles of recent vintage in Hollywood, and comes at the same time Warner Brothers and CBS, the network that broadcasts “Two and a Half Men,” are known to be seriously planning to continue the comedy – the most popular in television – with a new actor replacing Mr. Sheen.

The suit filed Thursday also includes a novel claim of damages on behalf of the entire cast and crew of the series for lost income due to the decision to shut down production this season, even though Mr. Sheen’s lawyers do not represent – at least at the moment – anyone else on the cast or crew.

To counter the claims Warner made earlier this week that Mr. Sheen had breached the terms of his contract with his behavior and comments, the suit cites Warner’s eagerness to sign Mr. Sheen to a new contract in May of 2010 to a deal for two more years on the series even though at the time he was facing both felony and misdemeanor charges.

The suit alleges that it was only after Mr. Sheen began making disparaging remarks about Mr. Lorre (which included an apparently gratuitous reference to Mr. Lorre as “Chaim Levine,” a Hebrew variant of his real name Charles Levine) that any action was taken. Mr. Sheen was “provoked into criticizing Lorre in response to his harassment and disparagement campaign, which had been going on for years” the suit charges.

As evidence of that campaign, the suit included several comments Mr. Lorre included on what he calls “vanity cards” that appear at the end of each episode. Among these were suggestions directed at himself like “Go to an Al-Anon meeting;” one directed at viewers urging them to “avoid degrading yourself by having meaningless sex with strangers in a futile attempt to fill the emptiness of your soul;” and another asking for the audience to pray for people working on the series: “Feel free to pick whomever you think is most in need.”

Investors Add to US Stock Funds for 2nd Month

2011-03-10T13:19:00.000-08:00

BOSTON (AP) — Investors continue to warm up to the stock market.
For the second straight month, investors added more than they withdrew from U.S. stock mutual funds.

Industry consultant Strategic Insight said Thursday that investors deposited a net $15 billion into stock mutual funds in February. That's down from $21 billion in January, the biggest monthly surge into stock funds in seven years.
Yet the second consecutive month of net deposits suggests investor confidence is back, a couple years after the market meltdown ended. Before January, investors withdrew more than they deposited into stock funds for eight consecutive months.

In February, investors continued buying foreign stock funds as well, adding a net $6 billion.
Taxable bond funds attracted $13 billion, while a net $4.5 billion flowed out of tax-free bond funds.

NJ Private Sector Employment Grew in 2010

2011-03-10T13:18:00.001-08:00

TRENTON, N.J. (AP) — New Jersey labor officials say the state's employment picture in 2010 was slightly better than initially believed.

Adjusted data released Thursday by the state Department of Labor and Workforce Development indicates that private sector jobs actually grew last year instead of falling, while the decline in public sector employment was overestimated.

Overall, New Jersey gained 5,200 private sector jobs and lost 22,200 public sector jobs from December 2009 to December 2010, or a net loss of 17,000 jobs. Preliminary estimates had indicated a loss of 29,100 public sector jobs, and 1,600 private sector jobs.
The revised data means the state unemployment rate averaged 9.5 percent in 2010. The number trended lower through the year, from a high of 9.8 percent in January to a low of 9.1 percent in

December.
The state's unemployment rate remained unchanged at 9.1 percent for January, just above the U.S. rate of 9 percent. The rate remained stable even though the state lost 13,000 jobs overall for that month, with decreases reported in both the private and public sectors.

The largest private sector loses were in professional and business service (4,000), manufacturing (1,800) and education and health services (1,400). The only industry sector to post a net increase was trade, transportation and utilities (4,400), with all the job gain in retail trade (6,700).
Public sector employment was lower by 5,900 as losses at the state (3,800) and local government levels (2,600) outpaced a small gain in federal employment (500).

S.E.C. Head Admits Misstep in Madoff Ethics Issue

2011-03-10T13:17:00.001-08:00

WASHINGTON (Reuters) — The chairwoman of the Securities and Exchange Commission, Mary L. Schapiro Bernard L. Madoff. , told lawmakers on Thursday that the S.E.C. should have gone beyond what was required under ethics rules after the agency’s top lawyer disclosed that his mother had invested with

Ms. Schapiro discussed the issue before the House Oversight Committee, which is examining whether the agency’s former general counsel, David M. Becker, should have recused himself from advising the S.E.C. on matters related to Mr. Madoff, including how to compensate victims.
Mr. Becker had inherited money from his late mother, who had invested with Mr. Madoff. Becker has told lawmakers he was given the green light to work on Madoff matters from the agency ethics lawyer.

“While Mr. Becker did solicit and follow advice from the ethics counsel, I realize in light of this incident that as chairman I have to ensure that we go beyond what may be required in any particular situation,” Ms. Schapiro said.
Questions about Mr. Becker arose last month after Irving H. Picard, the trustee overseeing the Madoff case, sued him and two of his brothers to recover $1.5 million of the $2 million they had inherited in 2004 from a Madoff investment by their late mother. Mr. Becker’s financial ties to Mr. Madoff had not been publicly disclosed until that suit.

The revelations have raised fresh questions about ethical standards and practices at the agency, where Ms. Schapiro was brought in as chairwoman two years ago with a mandate to strengthen its enforcement unit.

Last Friday, H. David Kotz, the agency’s inspector general, announced that he would investigate the potential conflicts in Mr. Becker’s role as a Madoff recipient who was also the S.E.C.’s general counsel and senior policy director involved in decisions relating to the Ponzi scheme.