Although there are those who would disagree, Natural Disasters are probably not driven by politics, but nor are they immune from politics. Far from it. The actions taken by human actors undoubtedly affect the prevention, mitigation, and damage of natural disasters and their aftermath. The 'shock' refers to the natural act itself e.g. the earthquake. The 'aftershock' comes later. Post-earthquake 2010-2012 in Christchurch, New Zealand, the Earthquake Commission, the Canterbury Earthquake Authority, the Christchurch City Council, and the Government of the day equate to the net impact of the 'aftershock' on the population - the physical 'disaster' is far from the whole event. It is also made up of those shocking post-disaster events, such as delayed insurance payouts, top-down authoritarian decisions, ineptitude of professional bodies, evidence of corruption in the post-quake city - and the list goes on... Though governments are supposed to care about the social welfare of their citizens, they also have an interest in maximizing government income and though governments do spend on both preventative and palliative measures to lessen the impact of a potential natural shock, they also use natural disasters to redistribute power through the political effect, for example favouring disaster spending in regions that are politically aligned with the party in power. Dire circumstances provide rapacious governments with a stronger ability to increase their level of theft and to hide it. Disasters can be used as a blunt policy instrument to target or reward populations and to enrich a government and the 'corporate classes'. Interesting too, is the fact that a time of crisis can increase markedly the amount of information a population has about current or incumbent politicians and their governance style and outcomes. This is because disaster produces a highly informative environment where voters are continually debating and experiencing the performance and merits of the operators in power - be that a Prime Minister or a City Council. It is in these high information environments that voters learn enough to enable them to consider taking the decision to replace the political incumbents. For example, certain incumbents in Christchurch are currently responsible for rebuilding a city infrastructure and restoring the lives of affected communities to some semblance of order. During normal times there is usually little information about how good a job the incumbent did or is doing, but during an earthquake or hurricane voters quickly learn a lot more about whether the incumbent has done a good job and who these people actually are. When there is this much information floating around, information about performance may become sufficiently informative to overcome a voter's initial tendency to support an incumbent. Their likelihood of re-election by the persons of the affected area therefore has the potential to 'take a hammering'. And the truth is that as voters we often understand little beyond our own or our local community's pain and pleasure... as voters we often have only a vague, or at worst primitive understanding of the connections between incumbent politicians actions and our own pain or pleasure. Governments also rely on national media disinterest (or control) to ensure that populations outside the affected area get to hear little of their manipulations within the area.
General Motors' notice to shutter several plants reminds us that corporate welfare does not produce long-term sustainable businesses. It's a band-aid and a colossal waste of taxpayers' funds. Government could apply those funds to help retrain workers, assist them to find new jobs, and minimize loss of income during the transition to their new situations. Businesses Create Wealth and Jobs Business is the vehicle owners use to create jobs and provide incomes for employees and shareholders to become consumers and keep the economy growing. A firm must have the right people cooperating in the correct slots headed in the right direction. Its ability to pay its workers and shareholders comes from producing and selling machinery, equipment, goods, and services people want or need. We should encourage business owners to pay their employees well, become profitable, retain profits, reinvest in the business, and pay dividends to their owners. But we shouldn't bully firms to keep uneconomic plants open. If there is no market, there are no sales, no funds available. A structurally unsound business should close early while treating workers fairly and respectfully. Corporate Welfare Destroys Jobs Governments are not short of wealth destruction tactics. Thus, they give companies huge subsidies to "create jobs" or for other political reasons. They do not see that this is merely another major government-waste outlet. Sadly they do not examine results over time to see that their corporate welfare is anti-competitive and destroys jobs long-term. Governments' role is to create level conditions for firms to flourish. They must develop conditions amenable for businesses to want to operate in their jurisdictions. It is absurd and naive to believe bribing companies with handouts is more than a temporary fix. According to the Fraser Institute: Between 1961 and 2013, the federal [Canada] department of industry disbursed $22.4 billion to businesses... The top 10 recipients received just under $8.5 billion, or 38 percent of all money disbursed... [M]any corporations or their parent companies that receive corporate welfare are anything but start-ups. Also, in many cases, cash-on-hand possessed by the company or parent company far exceeds the total original corporate welfare amount disbursed. This calls into question at least one justification for policy that allows subsidies to business-that taxpayer assistance is required to fill in for market failure and a lack of capital. Some Blue Chip Companies Get Corporate Welfare In the USA, corporate welfare recipients include Nike, Intel, Boeing. Indeed, it is outrageous how governments arbitrarily dispense taxpayers funds to large corporations without consultation or accountability. Why not use these funds to cut personal income tax? Here again is an example of complacent electorate allowing government waste. In my experience in business in many countries, I saw several examples of corporate welfare, primarily because governments and unions did not want structurally unsound firms to close. Sadly, some of these firms received welfare payments for years but eventually closed. Governments and the public need to realize structurally unsound businesses will not survive. Therefore, the best approach is an orderly closure early that includes retraining and relocating workers, where feasible. Encourage companies to close with utmost care and empathy for employees. The alternative of staying open provides false hope about the business' future. If firms can survive only with financial aid from taxpayers, they have no future.