Tuesday, December 11, 2012

Black Swan Events

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# 6772

 


Black Swan events are game changing incidents that few, if anyone, had predicted. The phrase was coined by Nassim Nicholas Taleb in his 2004 book Fooled By Randomness, and expanded upon in his 2007 book The Black Swan.

 

Yesterday, the U.S. National Intelligence Council released a report called  "Global Trends 2030: Alternative Worlds" that tries to anticipate the global shifts that will likely occur over the next two decades.

 

This 166-page report tries to predict the future, but admits that the course of history is often abruptly and unexpectedly changed by outlier events – black swans – that are simply impossible to predict. 


Several of these `game changers’ have been topics of previous posts in this blog.

 

 

Global Trends 2030's potential Black Swans

1. Severe Pandemic

"No one can predict which pathogen will be the next to start spreading to humans, or when or where such a development will occur," the report says. "Such an outbreak could result in millions of people suffering and dying in every corner of the world in less than six months."

2. Much More Rapid Climate Change

"Dramatic and unforeseen changes already are occurring at a faster rate than expected. Most scientists are not confident of being able to predict such events. Rapid changes in precipitation patterns—such as monsoons in India and the rest of Asia -- could sharply disrupt that region's ability to feed its population."

6. Nuclear War or WMD/ Cyber Attack

"Nuclear powers such as Russia and Pakistan and potential aspirants such as Iran and North Korea see nuclear weapons as compensation for other political and security weaknesses, heightening the risk of their use. The chance of nonstate actors conducting a cyber attack—or using WMD (weapon of mass destruction) —also is increasing."

7. Solar Geomagnetic Storms

"Solar geomagnetic storms could knock out satellites, the electric grid, and many sensitive electronic devices. The recurrence intervals of crippling solar geomagnetic storms, which are less than a century, now pose a substantial threat because of the world's dependence on electricity," the report says.

 

While most people are loathe to think about them, these types of high-impact events are not wild-eyed Hollywood disaster movie fantasies. They are considered valid (albeit, low probability) threats by many of our nation’s planning and response agencies. 

 

Which is why agencies like the HHS, CDC, FEMA, Ready.gov and others work each day to convince citizens of the importance of being prepared for the unexpected, and why I devote a fair amount of this blog to everyday preparedness.

 

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And it’s not just the United States that looks at and prepares for low-probability-high Impact events. 

 

Last March in UK: Civil Threat Risk Assessment, we looked at a report issued by the UK government that is essentially a short list of disaster scenarios (man-made & natural) that the Cabinet Office believe to be genuine threats.

 

The 2012 list includes:

 

Pandemic influenza – This remains the most significant civil emergency risk. The outbreak of H1N1 influenza in 2009 (‘swine flu’) did not match the severity of the scenario that we plan for and is not necessarily indicative of future pandemic influenzas; the three influenza pandemics of the 20th century (1918–19, 1957–58 and 1968–69) all had differing levels of severity. The 2009 H1N1 pandemic does not change the risk of another pandemic emerging (such as an H5N1 (avian flu)
pandemic) or mean that the severity of any future pandemics will be the same as the 2009 H1N1 outbreak.

 

Also on their list is a repeat of the 1953 severe coastal flooding event that claimed hundreds of lives and caused extreme property damage and a catastrophic terrorist attack.

 

New this year are the addition of Severe effusive (gas-rich) volcanic eruptions abroad and the potential impact from severe space weather.

 

Few are aware of it now, but In 1783 the Craters of Laki in Iceland erupted and over the next 8 months spewed clouds of clouds of deadly hydrofluoric acid & Sulphur Dioxide, killing over half of Iceland’s livestock and roughly 25% of their population.

 

These noxious clouds drifted over Europe, and resulted in widespread crop failures and thousands of deaths from direct exposure to these fumes. There are also anecdotal reports that suggest this eruption had short-term global climate impacts as well.

 

Were that to happen again today, the effects would be absolutely disastrous to Europe, and the rest of the world.

 

Sounding a bit like science-fiction, violent solar flares and earth directed CMEs are also on FEMA’s and the UK’s worry list, and are subjects we’ve discussed before:

 

A Flare For The Dramatic
Solar Storms, CMEs & FEMA
A Carrington Event

 

NASA, while admitting that a serious solar storm could happen practically anytime, also cautions that the next big one could be many decades away. It is a genuine threat, they say, but the timing is impossible to predict.

 

In June of 2011 (see OECD Report: Future Global Shocks), we saw a series of reports come out of the OECD (The Organisation for Economic Co-operation and Development) that warned - as the world becomes more interconnected and interdependent - that `Global Shocks’ to the world economy become more likely.

 

They define a Global Shock as: a rapid onset event with severely disruptive consequences covering at least two continents.

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While discussing a wide range of future shock scenarios, the authors concentrated most of their attention on five highly disruptive future shock events.

  • A Pandemic
  • A Cyber Attack
  • A Financial Crisis
  • A Geomagnetic Storm
  • Social Unrest/Revolution

 

They also make special note of the risks of increased antibiotic resistance, and the need for new classes of antibiotics to be developed. 

 

The common threats running through all of these reports are a Pandemic, a coordinated cyber Attack, and destructive solar storms.

 

But of course, by definition, a `black swan event’ comes as a surprise. The next global shock may not come from this list, it could be something we’ve not considered.

 

 

Until it happened, few people would have seriously concerned themselves that a 9.0 earthquake, and a 100 foot tsunami, could devastate northern Japan, disable four nuclear reactors, and change the view of nuclear energy in many countries around the world.

 

But regardless of the source of the next future global shock, being prepared to deal with it is of paramount importance.

 

While there is much governments can do to prepare, a nation’s resilience in the face of a major crisis –whether it be local or global - truly comes from the bottom up, not from the top down. 

 


Being prepared doesn’t mean going to extremes.  You don’t have to dig a bunker, or set aside 10 years worth of canned goods. Nor should you focus on one particular threat, or scenario.

 

Instead, the smart money is on taking basic preparedness steps against `All Hazards', including those you may not automatically assume are a threat where you live.

 

Everyone should have a well thought out disaster and family communications plan, along with a good first aid kit, a `bug-out bag’, and sufficient emergency supplies to last a bare minimum of 72 hours.

 

Based on the  events in Japan (or after Hurricane Katrina in New Orleans, or the earthquake in Haiti) 3 days of supplies many not be enough for a truly worst case scenario.

 

The County of Los Angeles Emergency Survival Guide calls for having 3 to 10 days worth of food and water. Personally, I believe that 2-weeks of supplies isn’t an unreasonable goal, particularly if you live in earthquake or hurricane country.

 

The L.A. guide may be downloaded here (6.5 Mbyte PDF).

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For more information on preparedness, you may wish to visit:

 

FEMA http://www.fema.gov/index.shtm

READY.GOV http://www.ready.gov/

AMERICAN RED CROSS http://www.redcross.org/

 

And lastly, you may wish to revisit some of my earlier preparedness essays, including:

 

In An Emergency, Who Has Your Back?

 

The Gift of Preparedness 2012

 

An Appropriate Level Of Preparedness

 

Because, by the time you recognize the onset of a black swan event, it is probably too late to prepare for it.