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News brief: Hurricane Ian is downgraded, Baltic pipeline leaks, U.K. economic turmoil

LEILA FADEL, HOST:

After making landfall as a powerful Category 4 storm, Hurricane Ian continues to move across the state of Florida, but it's been downgraded to a tropical storm.

RACHEL MARTIN, HOST:

People on Florida's Gulf Coast are just beginning to go out and assess the damage. Millions of homes and businesses are without power. That's a number that is likely to grow as Ian continues its path across the state.

FADEL: NPR's Greg Allen joins us now from St. Petersburg. Hi, Greg.

GREG ALLEN, BYLINE: Hi, Leila.

FADEL: So tell us what areas were hit hardest.

ALLEN: Well, Hurricane Ian made landfall on Cayo Costa, an island just off Fort Myers, and then a second landfall near Punta Gorda. That, as it happens, are the same two places that Hurricane Charley came ashore in 2004. Damage assessments have yet to come in. We'll see when the sun comes up. But during the storm, we heard reports and saw videos of a massive storm surge in beachfront communities in Naples and Fort Myers. When crews get out today, they'll be checking neighborhoods like Cape Coral and Englewood. Those areas didn't just get a big storm surge; they also took a beating from super high winds for hours, as Ian slowly moved inland. And there will be wind and surge damage up the coast in Sarasota and as far north as St. Petersburg.

FADEL: I mean, these videos of the flooding and the storm surge and the winds - I mean, did people listen to those evacuation orders and get out before the storm hit and all that damage came?

ALLEN: It seems that mostly they did. Many people in this area, as I mentioned, experienced Hurricane Charley, another Category 4 storm, nearly 20 years ago, and they know the dangers that these things can pose. But there clearly were people who did not evacuate, and it was dangerous yesterday during the storm for crews to respond to calls for help. Officials really aren't sure how many may still need help. The 911 call center was down in Lee County, one of the places that was hit hardest in the storm. Today, search and rescue teams are going door to door through neighborhoods and offering help to those who need it.

FADEL: OK. So as I mentioned earlier, the storm's now downgraded to a tropical storm. Does that mean the worst of this is over now?

ALLEN: Well, the storm's in central Florida now and moving very slowly. It's not expected to leave the state and go to the Atlantic until late this afternoon. But meteorologists and emergency managers say Ian is still very dangerous. The problem isn't wind now so much as flooding from extreme rainfall. Some areas in central and northeast Florida are already getting a heavy downpour and may see more than 2 feet. We're hearing reports of flooding in the Orlando area, for instance. Florida Governor Ron DeSantis says Ian is affecting more than just the Gulf Coast.

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RON DESANTIS: But the fact is there's going to be damage throughout the whole state. And people in other parts of the state, be prepared for some impacts. And you are seeing counties in different parts of the state issue evacuation orders.

ALLEN: And many of those counties are in northeast Florida, near Jacksonville.

FADEL: OK. So right now we don't know the extent of this damage, but we do know millions are without power. Any indication of when that will be restored?

ALLEN: Well, utility officials say that they have more than 40,000 workers ready to start restoring power as soon as it's safe to do so. The effort will begin today in communities where the winds have dropped and crews can get in and start the work. The first step, though, is clearing the roads, which has to happen here. The head of Florida Power & Light, the state's largest utility, warned there's likely to be structural damage that would take days or weeks to repair. The company is going to be deploying a large drone today, one that's larger than a private plane, to begin assessing the damage. And more power outages are expected as Ian keeps moving across Florida.

FADEL: OK. With 150-mile-per-hour winds, I mean, Ian must be one of the most powerful hurricanes ever to hit Florida.

ALLEN: Right. It's tied for fifth as the most powerful storm ever to hit the Florida peninsula, behind the 1935 Labor Day hurricane and Hurricanes Andrew and Michael. Governor DeSantis says - he's comparing it to Andrew and Michael. And he says this may reshape southwest Florida, like those did to those other communities.

FADEL: Thanks. That's NPR's Greg Allen in St. Petersburg.

ALLEN: You're welcome.

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FADEL: Blasts were recorded prior to major methane leaks being detected in Baltic Sea pipelines, according to European seismologists.

MARTIN: European leaders have said the explosions and the leaks on the Nord Stream pipelines were deliberate acts. NATO Secretary General Jens Stoltenberg and some other EU officials have gone so far as to call it sabotage. There is growing concern about how vulnerable oil and gas installations around Europe are to some kind of intentional attack.

FADEL: NPR's international affairs correspondent Jackie Northam has been following developments and joins us now to talk about this. Hi, Jackie.

JACKIE NORTHAM, BYLINE: Morning, Leila.

FADEL: Good morning. So these two pipelines were supposed to be carrying Russian natural gas to Europe, but neither were operating, right? So does this really have any impact when it comes to European energy supply?

NORTHAM: Well, you're right. Neither pipeline was operating. Germany had halted the Nord Stream 2 project just days before Russia invaded Ukraine, and then Moscow turned off the taps on Nord Stream 1 in August in retaliation for sanctions on Russia and Europe's support of Ukraine. So there hasn't been any gas moving through those pipelines right now anyway. And in the short term, it has no impact. In the medium to long term, Europe can forget about getting gas from those pipelines again.

FADEL: So no really even promise of future gas from these pipelines now. What are European countries doing to make up for the shortfall in Russian gas overall?

NORTHAM: Well, they've been trying to do everything they can right now, you know, including firing up old coal power plants and rethinking shutting down nuclear power plants. European leaders have also been scouring the world trying to find new supplies and, you know, from places like the U.S. and Qatar and Algeria. There's a bigger issue here, though. I spoke with Robert McNally, who's the president of Rapidan Energy Group, and he said what we're looking at now is a world energy war. He says it started when Russia cut the flow of gas in Nord Stream 1, which Europe depended on, and, he said, has created shifting alliances and more competition. You know, Europe's going to have to bid against countries like Japan and China even more now. Let's have a listen.

ROBERT MCNALLY: Everybody is slowly and surely getting drawn into this energy war. It's not just going to be a European energy war. It's just the integrated nature of global energy markets. And countries make decisions on what to buy, where to buy from, based on policy and political and geopolitical considerations.

NORTHAM: And, Leila, McNally says what we're looking at now is really the biggest geopolitical disruptions in global energy markets since the late 1970s, you know, when you had the oil embargo.

FADEL: OK. Given that Europe is in such a precarious energy situation, as you've described, has this incident on the Nord Stream pipelines, especially if it's proven to be deliberate, raise security concerns about energy infrastructure more broadly?

NORTHAM: Oh, this has definitely been a wake-up call for Europe and most likely the U.S. about the vulnerability of critical infrastructure. You know, there are a lot of gas pipelines and power and telecommunication cables crisscrossing Europe, and any of them could be a target. And we saw Norway and Denmark come out yesterday saying they've increased their security around oil and gas installations. And Norway has this new pipeline that sends gas to Poland. It's about to go online. And it could be open to attack. And today, Swedish news agency said there's been a fourth leak found on one of the Nord Stream pipelines.

FADEL: NPR's international affairs correspondent Jackie Northam. Jackie, thanks.

NORTHAM: Thank you.

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FADEL: The British economy has faced some significant challenges in the past few days.

MARTIN: The country's currency, the pound, weakened to a record low against the U.S. dollar, while government borrowing costs shot up. All this happened after the new Conservative government, led by Prime Minister Liz Truss, announced new economic proposals.

FADEL: Willem Marx joins us from London with details. Hi, Willem.

WILLEM MARX: Hey.

FADEL: OK. So the British economy is in turmoil. The pound has slumped. And the new British prime minister, Liz Truss, she's been in the job less than a month and is already facing pressure from within her party to fire her finance minister. What's going on?

MARX: Well, you're right. It's been a very volatile few days on the markets since these economic proposals were unveiled by that finance minister, Kwasi Kwarteng, last Friday. The pound - actually now slightly stronger this morning than it was on Monday but not by much. The turmoil was essentially sparked when Kwarteng, the new finance minister, announced tax cuts in the last week. There was a nasty chain reaction. Very quickly, as you said, the pound weakened. The costs for British government borrowing, they've shot up. This in turn led to a warning from the International Monetary Fund, who issued a statement saying that the government's tax cut plans were economically risky. They were likely to create greater income inequality.

And then yesterday, there was a very rare intervention by the central bank here, the Bank of England, which stepped in and promised to start buying up U.K. government bonds. And this essentially was to create an artificial demand for them, so the interest rates on those bonds would not rise too high.

FADEL: But was this to be expected? I mean, this is what Liz Truss promised when she campaigned to replace Boris Johnson. She said she would lower taxes, and she did. Why did this make people nervous?

MARX: Well, part of the difficulty was that there was not a huge amount of detail when Truss' finance minister addressed Parliament about this last week. He promised a new economic era. He said British economic growth had been lower than it should have been in the past. His solution seemed to be to lower taxes slightly for everyone and lower them quite a bit, 5%, for the country's highest earners, as well as end caps on bonuses for the very top earners in the financial sector. The thinking was that those high earners will invest more in Britain. They'd expand businesses. They'd create jobs - trickle-down economics.

But the reaction focused on the fact that these ideas were not costed. That's to say there was no explanation given for how exactly the government planned to make up the shortfall in public funding these tax cuts would generate, besides borrowing more money. And it was that plan to borrow so much more money, many tens of billions of dollars, without total clarity about long-term plans to repay that money that made investors so nervous.

FADEL: I guess it's a different economic era. So what are the political and social consequences of the government's actions over the past week?

MARX: Well, Conservative Party members of Parliament, they've already expressed unhappiness with Liz Truss' finance minister. But the government's insisting they're going to stick to these economic guns. One thing that's particularly spooked those conservative legislators is the very strong showing in polls of the opposition Labour Party, the highest they've been in many years. And the party's leader, Sir Keir Starmer, he's accused Liz Truss and her cabinet of having lost control of the economy. He said in an interview with the BBC yesterday, he thought they should rethink these new proposals and suggested an early recall of Parliament to discuss the crisis.

For ordinary people here, though, including many Conservative voters, the fallout will be in much, much higher mortgage payments in the months ahead. And with just two years till the next election here, that may still make Liz Truss and her finance minister rethink this policy move.

FADEL: Willem Marx talking to us from London. Thank you so much.

MARX: Thank you. Transcript provided by NPR, Copyright NPR.

Rachel Martin is a host of Morning Edition, as well as NPR's morning news podcast Up First.
Leila Fadel is a national correspondent for NPR based in Los Angeles, covering issues of culture, diversity, and race.