19 April 2010

Cassandra crossing

Adam Cohen has an opinion column in The New York Times:
In Treme, HBO’s new series about New Orleans, a college professor played by John Goodman rails against the needless tragedy of Hurricane Katrina. The storm was a natural disaster, he says, but the flooding that followed was a man-made catastrophe, decades in the making. Many people knew about the threat, but no one did anything about it.
Mr. Goodman’s blustery tirade about warnings not being heeded channeled a national anger that extends well beyond Katrina. We are living in an age of Cassandra, in which experts and ordinary people are regularly grabbing the appropriate authorities by the lapels and warning them of impending disasters, almost invariably to no avail.
Harry Markopolos, a Boston financial analyst, has been out promoting his new book, No One Would Listen. It is an account of the eight years he spent trying to persuade the Securities and Exchange Commission that Bernard Madoff was running a multibillion-dollar Ponzi scheme. Mr. Markopolos recounts his tireless efforts to wave red flags in front of government watchdogs. In the spring of 2000, Mr. Markopolos says he tried to explain to a senior SEC official why Mr. Madoff’s numbers did not add up, but “it very quickly became clear he didn’t understand a single word I said after hello”. In the end perhaps $65 billion disappeared, much of it belonging to charities and retirees.
There have been decades of urgent reports about sexual abuse in the Catholic Church, including a 1963 letter that recently surfaced, in which the head of a New Mexico Catholic order recommended to the pope that paedophile priests be removed. Cases of abuse in the United States have been drawing attention at least as far back as 1985, when a Louisiana priest admitted to abusing 37 children. A 1992 meeting of bishops in South Bend, Indiana, admitted that some bishops had hidden abuse cases. Still, just last year, the Diocese of Memphis and the Dominicans agreed to pay $2 million to a man who reported being abused as a teenager in 2000.
There were plenty of warning before the financial crisis of 2008. In 2000, Edward Gramlich, a Federal Reserve governor, cautioned that new subprime lending practices were making risky mortgages available to people who could not afford them. He urged the Fed to send examiners to investigate, but as a Times headline later reported, the “Fed Shrugged as Subprime Crisis Spread”.
Critical warnings about the attacks of 11 September 2001, were also ignored. Harry Samit, a Minnesota FBI agent, warned in an August 2001 memo to higher-ups that Zacarias Moussaoui, the so-called twentieth hijacker, was a terrorist intent on hijacking an airplane. Mr. Samit said that he sent seventy separate warnings.
The complaint by Mr. Goodman’s character is based in fact. The Times-Picayune of New Orleans did a prescient series on the city’s vulnerability to a major hurricane, and the dangers were known nationally. In 2002, an article that I wrote on this page warned that if a bad hurricane hit, New Orleans “could fill up like a cereal bowl” and might even disappear.
In Greek drama, Cassandra, daughter of King Priam of Troy, was given the gift of prophesy by Apollo, but when she spurned his advances, he ordained that her prophecies would not be believed. There is no such simple answer today for why so many warnings are ignored.
Incompetence often plays a role. So does ideology: one reason Mr. Gramlich, a Democratic nominee, was ignored was that his warnings clashed with the antiregulatory convictions of the Bush administration. In other cases, to borrow Al Gore’s phrase, an “inconvenient truth” imposes burdens that people don’t want or threatens powerful interests. And a key reason Louisiana and the nation did not rally to better protect New Orleans was simply inertia.
Predictions of disaster have always been ignored— that is why there is a Cassandra myth— but it is hard to think of a time when so many major warned-against calamities have occurred in such quick succession. The next time someone is inclined to hold hearings on a disaster, they should go beyond asking why particular warnings were ignored and ask why well-founded warnings are so often ignored.

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