Richard Posner on (Not) Planning for Disaster

From the oil spill to the financial crisis, why we don't plan for the worst
Richard A. Posner
The Washington Post
June 6, 2010

The BP oil spill in the Gulf of Mexico is the latest of several recent disastrous events for which the country, or the world, was unprepared. Setting aside terrorist attacks, where the element of surprise is part of the plan, that still leaves the Indian Ocean tsunami of 2004, Hurricane Katrina in 2005, the global economic crisis that began in 2008 (and was aggravated by Greece's recent financial collapse) and the earthquake in Haiti in January.

In all these cases, observers recognized the existence of catastrophic risk but deemed it to be small. Many other risks like this are lying in wait, whether a lethal flu epidemic, widespread extinctions, nuclear accidents, abrupt global warming that causes a sudden and catastrophic rise in sea levels, or a collision with an asteroid.

Why are we so ill prepared for these disasters? It helps to consider an almost-forgotten case in which risks were identified, planned for and averted: the Y2K threat (or "millennium bug") of 1999. As the turn of the century approached, many feared that computers throughout the world would fail when the two-digit dates in their operating systems suddenly flipped from 99 to 00. The risk of disaster probably was quite small, but the fact that it had a specific and known date made it irrational to postpone any remedies -- it was act now or not at all.

Such certainty about timing is rare; indeed, a key obstacle to taking preventive measures against unlikely disasters is precisely that they are unlikely to occur in th