Showing posts with label Systemic Fragility. Show all posts
Showing posts with label Systemic Fragility. Show all posts

Tuesday, July 20, 2010

Great Flood Fiasco: "Intense Storms" or Sinking Sampan?

When a major unexpected event with severe deleterious consequences occurs, those who were responsible for preventing it from happening, or were supposed to have seen it coming and have dome something about it, often give similar types of excuses for its occurrence. The typical excuse given is that the event that occurred was an event of such low probability or such low frequency that there was nothing really that could be done to prevent it or to foresee its occurrence.

There are several names given to such events... "Perfect Storms", "Once-in-a-million year event", "Outlier", "Freak Event"... all give the connotation that there was nothing that could have been done to prepare for it, and hence those who should have seen it coming should be absolved from any blame or responsibility since there is nothing they could have done in the first place.

There are a couple of notable events in recent history that have been attempted to be explained away as "perfect storms" or "outliers". These include events such as the Great Financial Crisis, which brought the entire US banking system to its knees, the Deepwater Horizon Oil Spill disaster, which is the single largest and most damaging oil spill in US history, and the recent stock market blip that resulted in the biggest intraday point drop ever in the Dow Jones Industrial Average.

In close examination, history will find that these events were actually results of Systemic Failures, rather than "outlier" events. The Great financial crisis was caused by systemic failure across the entire financial system - from excessively low interest rates by the central bank, to over-deregulation of the banking system, to overly lax lending by commercial banks, to greedy investment bankers. The Deepwater horizon spill was caused by executive decisions which put cost-cutting ahead of safety, by complacency and hubris.

Closer to home here in Singapore, Yaacob Ibrahim has attempted to explain away the recent flash floods as "intense storms" and "freak events." The most famous quote he has given Singaporeans is that floods of this magnitude happen "once in 50 years". In short, Yaacob Ibrahim is basically trying to say that the flooding is caused by outliers and perfect storms, not by a faulty drainage system.


Monday, July 19, 2010

Massive Flood Cockup Exposes Cracks in the Political System

When everything is going fine and there are no major cockups, it is easy to for a single-party state and all its institutions and appendages to give the appearance of unity and strength, and for the ruling party to cling onto totalitarian political power. However, when something major goes very wrong, such incidents tend to expose the cracks, flaws and fragilities in the system.

What used to look like a unified front starts to turn into infighting and bickering as the little generals start defending their own turf and try to push the blame for the cockup to one another. This happens when the dominant personality at the top - who previously held the system together and imposed discipline on the ranks - starts to fade from power. This also happens when the cockup was clearly part of the system, and when the blame cannot be pushed to the public.

Here is the low down of the turf clashes that have emerged in the aftermath of the flood cockup