Reaction Entry (April 16, 2011)

*This article was printed on the Economy section of the April issue of TIME Magazine I have at home. I could not find an online copy but this is the entire article, retyped.


Helping Hands? Donations to Japan are lagging behind previous relief efforts. 


As Japan digs out from its devastating March 11 earthquake and tsunami, international donors have been hesitant to commit large sums of money to the relief effort. According to figures compiled by the Chronicle of Philanthropy, U.S. donors gave $105 million to Japan in the first week, compared with $275 million for Haiti after its earthquake last year. (Hurricane Katrina got $500 million in the first week.) Other countries don't appear to be eager to give either. Why? "It's largely because Japan is a well-developed country with an established relief system," says Chronicle editor Stacy Palmer. Even though the World Bank estimate of $235 billion in damage dwarfs the figures for more recent natural disasters, there's a perception that wealthy Japan can handle it. And with uprisings in the Middle East dominating the news cycle, fundraising is likely to continue at its sluggish place. -JOSH SANBURN

Recreation of the inforgraph from the original article.

Source: TIME Magazine, April 11, 2011


Reaction:


Natural disasters are any man's bane. Sufficient preparations, although substantially cut losses in terms of damages, still have a palpable impact on any business firm. Now imagine a country, which is composed of several businesses and households, hit by a major catastrophe. This would easily multiply the effect a hundredfold--millions even.


As someone who has a parent living and working in Japan, I can personally attest to the financial repercussion of the recent disaster. A few weeks after the earthquake, my mother's job was cut drastically to only three hours each day. Without much productivity, a business cannot achieve its goal. Regardless if it's a major company, forced cuts on work hours due to non-conducive working environment has a major impact on the company's output. Efficiency will drop and the wasted resources will pile up, and unfortunately these resources may not be useful once things begin to work in tip-top shape again. Translating this scenario nationally can result in a downward trend in economic wellbeing. Regardless of Japan's wealth, she is still in need of financial aid from other countries. Using its position in the economic hierarchy of the globe as an excuse seems a tad bit unreasonable. Yes, there are a lot of other current issues, including the unrest in the Arab Springs, but Japan had always been there for others in times of trouble. They may have a lot of money now to cover some of the costs of rehabilitation but the long-term effects of this disaster to their economy will not only affect their shores but others as well. 


The natural disaster that happened in the country not only affected the native citizens but foreign workforce as well. Consider my mother, she has been working in the country for eleven years and this is the only time that she felt a considerable lag in personal financial progress. Because of the substantial cut in work hours, she also had to cut expenses, which means that we, her children living in the Philippines, should also adjust dramatically. The budget adjustment has reduced the household's economic pie and we have to determine how to promote equity as much as possible by trimming our expenses here and there. Unfortunately, finding another job poses a difficulty because not every business in Tokyo is hiring. Why aren't they hiring? Aside from the natural disaster that rendered most of the equipments out of commission, the majority of the city is in disarray. In addition, because of the dismal conditions of the Fukushima nuclear plants, the country had to impose a mandatory four-hour blackouts. This, in my opinion, is one of the causes of the disaster that has the largest impact in the economy. Four hours of blackout can severely attenuate the productivity of a business. Imagine how much output they can produce in those four hours. Aside from the blackout, the tsunami hit a major agricultural site of the country. Rice, one of Japan's major produce, was severely affected. And now due to the increasing fear of radiation leaking out of the nuclear plants, many turned to other food sources, mainly processed ones. The only problem here, though, is that these goods are also distributed among families in evacuation centers. Naturally, a quota was placed on the purchase of these goods. For instance, stores cannot allow a buyer to buy cup ramens in bulk; there is a limit to how many they can purchase. Why? This is simply because of the food shortage the country is facing.


On the bright side, this natural disaster also produced more jobs. Sendai, for instance, the most hard-hit area of the country, has been recruiting able-bodied personnel for reconstruction jobs. This is a good opportunity to increase the employment rate of the country. Of course, workers should not expect excellent living conditions because most of Sendai was wrecked by the tsunami and earthquake. But that is not much of a trade-off considering the opportunity of earning a modest income.


On a final note, I just want to say that we should not belittle these problems because they have long-term economic impacts. It is extremely unfortunate that other countries are reluctant to send assistance to Japan, especially now when the country needs aid the most. Even I, who have been living in the Philippines all my life, am experiencing the financial impact of the recent natural disaster that hit Japan. I dearly wish for Japan to recover fully from their misfortune. Unfortunately, I know now that will take more time since Japan is rehabilitating itself alone. Any country, regardless of wealth, will require help after a major natural disaster. But because the world today is plagued with war and unrest, it may be long before Japan can receive the sufficient help it needs to rise from ruin.