Why The Government Shares Blame With BP For The Oil Spill
From Wes Benedict, executive director of the Libertarian Party:
When the CEO of BP appeared at a Congressional hearing yesterday, Republicans and Democrats predictably engaged in finger-pointing and blame-ducking, trying to score political points. Their fingers should have been pointed at themselves.When President Obama gave his Oval Office speech on Tuesday, there was one important word missing: the word 'liability.' The president never mentioned that, thanks to liability caps provided by the federal government, BP was able to engage in riskier activities than it would have otherwise. If BP had known in advance that it would be fully liable for all damages related to an oil spill, it probably would have taken greater safeguards. When you know that your liability will be strictly limited, cutting corners becomes a lot more attractive.
... The president has apparently convinced BP to put $20 billion in some kind of compensation account. He said in his speech that it will be 'administered by an independent third party.' Will this third party be able to decide what 'legitimate claims' are, and how much they should receive? Assessing damages should be done by courts, not by political bureaucrats appointed in backroom deals between the president and a large corporation.
The president could have taken the opportunity to talk about getting government out of the energy industry, and allowing the free market to guide the future of energy production. Unfortunately, he instead blamed the free market for government failures, and discussed his hopes of increasing government interference in the energy industry.
For decades, Libertarians have warned against putting trust in government regulatory bureaucracies like the Minerals Management Service (MMS). While costing the taxpayers a lot of money, these agencies generally fail to deliver the kind of protections they promise, they tend to become corrupt, and they discourage vigilance on the part of citizens by lulling them into a false sense of security.







The company I work for is contracted by the Department of Energy. It has been, in one form or another, and by one name or another, since the Department was formed.
This has not prevented one dollar of waste. The K-Reactor Cooling Tower was just demolished - for $4.4 million - to "reduce our industrial footprint", after having cost about $80 million to erect. By the way - by the time it was built, restrictions on operating old K-Reactor meant it wasn't really necessary for over 11 months out of the year. No, we were told, it couldn't be used for anything else
We started a division called, "D & D", whose job is to remove structures all over the 300+ square-mile Site. Somebody audited the figures, and found out that the "cost savings" touted as one of the reasons for the demolition work (knock it down, went the justification, you don't have to monitor it) would only be realized after about 14 thousand years. Demolition of shielded buildings costs big $$.
The president of the current contractor showed up one day and started to tell us to "work smarter, not harder". Oops. He was talking to an audience who has no choice whatsoever but to follow regulatory-program procedure and do what they are told.
There are two things to realize here. In the public sector, the number of employees who report to you determines your pay - not, especially, their performance. The second thing is that when you tell somebody to produce a paper showing how important they are, they'll prove they're vital.
Dilbert is thriving still in the public sector.
Radwaste at June 20, 2010 2:29 AM
BP is a huge company— I don't really think it could, like Barings bank, simply be made to vanish because of this single crisis.
I might be wrong though. It's the biggest environmental crisis the country's ever faced. There are some good people at BP, and they provide a product people want... But they fucked up, and they can be punished with the loss of their jobs.
No one in the MMS will lose their job, nobody. Even if they do, employment at the agency will soar in the years ahead, even if it's renamed.
Crid [CridComment at gmail] at June 20, 2010 5:05 AM
Just sayin'....
Crid [CridComment at gmail] at June 20, 2010 5:34 AM
The thing that bothers me about all this is the call for more regulation.
This is the same issue as the gun laws. There are multiple laws in place already about gun possession, transport, and use. Enforce those. Don't create new ones that will just conflict with existing ones.
Another example is the immigration laws -- what part of "illegal" means you get a pass if stopped?
The issue isn't needing more regulation or laws -- just enforce the ones that are already in place.
Jim P. at June 20, 2010 5:36 AM
"No one in the MMS will lose their job"
The head of the MMS resigned back in May.
clinky at June 20, 2010 9:56 AM
Great!
That's ONE... In an agency with a (wiki) budget of $310 million.... And there are other costs.
And I can't even FIND how many people work there. Look at this shit.
Crid [CridComment at gmail] at June 20, 2010 10:13 AM
Assessing damages should be done by courts, not by political bureaucrats appointed in backroom deals between the president and a large corporation.
I appreciate the man's concerns about potential for abuse in the administration of the fund (though the man chosen appears to be competent and is well-regarded for his work with the 9/11 fund), but I think that litigation is a really poor solution when people are losing their livelihoods now. As we know from the Exxon Valdez case (which was only recently resolved, with greatly reduced damages), a big company can delay compensating victims in complicated cases for a generation if it is so inclined. Libertarians generally favor litigation over regulation, but the court system is quite limited in its ability to resolve issues in a timely fashion.
Christopher at June 20, 2010 11:44 AM
Rep. Joe Barton apologized for the behavior of the congressional committee he sits on, and for Obama's strong arm actions. He attempted to clarify the situation.
The committee was putting on a "show trial". Their aim is to gain popular support by demonizing BP outside of a court or factual review. They wanted blood, not truth or reasonable damages. BP is probably guilty and should pay damages decided by a court and due process. All of us, even BP, are supposed to be protected from a political witch hunt.
Obama extracted $20 billion from BP to be administered politically by himself as executive. If there is law supporting that action, then it should have been arranged through a court ruling. We have courts and due process to arrange such things.
If you want a country where the President (or El Presidente) can decide by whim the fate of anyone, then support Obama's actions and congessional show trials. If you want freedom, then support the slower, rational process of courts, trials, evidence, and judicial due process.
Andrew_M_Garland at June 20, 2010 12:02 PM
Andrew, I share your dislike of the posturing that accompanies Congressional hearings about events like this. Such hearings never lead to useful insights about complicated problems.
However, your characterization of Obama's role regarding the fund is not correct. BP had offered to create the fund before the meeting with Obama; at most, the president negotiated some of the details. BP went to that meeting knowing that Obama had no power to compel them to do anything; they clearly decided it was in the best interests of the company to create the fund.
Christopher at June 20, 2010 12:35 PM
I haven't followed this issues closely, so correct me if I wrong, but in my opinion people have short changed President Obama on this crisis.
When this issue first broke I heard on the news that there was a law forbidding oil companies from paying more than 700 million dollars in damages. At the same time BP was blowing off the press and looking for ways out of its responsibility.
Now, after President Obama's involvement most people know the name of BP's CEO and what his face looks like like. They have seen it on the news when Tony Hayward goes before Congress to answer for his company. BP has also cashed in some of its investments to set up a 20 BILLION dollar fund to help clean up the damage in the Gulf.
Even if the oil companies weren't the royalty of the planet it would be very impressive that BP came to do these things. He didn't do it alone but President Obama was involved in making these things happen.
Steve at June 20, 2010 12:41 PM
Obama has been saying that he is directing what BP does, through government agencies which are also watching and controlling in detail all BP actions.
But, you say that "BP knew that Obama had no power to compel them to do anything".
I must suppose that you have inside knowledge.
Andrew_M_Garland at June 20, 2010 4:43 PM
"The thing that bothers me about all this is the call for more regulation.
This is the same issue as the gun laws. There are multiple laws in place already about gun possession, transport, and use. Enforce those. Don't create new ones that will just conflict with existing ones."
You are arguing against your yourself. "Regulation" is me than making regulations; it also has to do with actually enforcing them. The MMS has ben the whore of the oil companies, Rep. Barton is apparently the whore of the oil companies, and so is Sen. Cornyn, judging from his own remarks.
Also, this is nothing like gun laws, and don't be fool enough to let them talk you into feeling any kind of fellow feeling for them. Gun laws apply to individuals, you know, actual citizens. A corporation is a treated like a citizen only as a legal fiction. A company the size of BP is on par with most national governments in the world. They move nationals governments like Nigeria around chess pieces and they want you to think of them as a some private little company, like the guy down the street trying keep his trucking company going. In fact this is more like the governmrnt of France coming into the US and doing whatever the fuck it wants and buying off or destroyiing anyone who wants to get in the way.
Jim at June 20, 2010 6:37 PM
I love it when people rail against the incompetent "government regulatory bureaucracies," then get on the government-maintained road to go eat some non-tainted meat, courtesy of the FDA, before getting home to a stack of mail delivered by the US Postal Service in under 2 days, take a sip of safe drinking water from the tap...
Yes, some government agencies are ridiculous, but painting them all with the same brush is simply disingenuous.
biscuit at June 20, 2010 8:04 PM
To Biscuit,
This seems to be your argument: Government regulatory bureaucracies must be competent because government maintains the roads adequately.
The Obama team immediately fired the head of the Minerals Management Service, the department that had regulatory control over oil drilling. She was appointed by Obama. Is this because she was doing a good job?
By the way, the US Postal Service is going broke, and only remains in business because it has a legal monopoly on first class mail.
I have never seen an article reporting on the outstanding efficiency of a government service or agency.
Andrew_M_Garland at June 20, 2010 8:28 PM
Amy Alkon
http://www.advicegoddess.com/archives/2010/06/20/why_the_governm.html#comment-1725248">comment from biscuitThe roads aren't maintained, the meat is tainted, the water is filled with contaminants, but I do love my postman, who once told me that if he won the lottery, he'd still deliver the mail. That said, there's a blog post about the post office in many areas not answering the phone. Ever. Just letting it ring.
Amy Alkon
at June 20, 2010 10:12 PM
But, you say that "BP knew that Obama had no power to compel them to do anything"...I must suppose that you have inside knowledge.
I might have not been entirely clear in my previous post. What I intended to convey was that Obama had no power to compel BP to create the fund; BP chose to create the fund.
Christopher at June 20, 2010 10:29 PM
". . . . then get on the government-maintained road to go eat some non-tainted meat, courtesy of the FDA, before getting home to a stack of mail delivered by the US Postal Service in under 2 days, take a sip of safe drinking water from the tap..."
The roads are crap where I live.
The meat is prone to e.Coli and salmonella due to factory farming. Government regulations keep small ranchers (who frequently have safer products) on the edge of survival.
USPS is a monopoly funded by tax subsidies. It doesn't exist because it is efficient, cost effective, or providing an enjoyable service. I only use it when something's got to be sent to a PO Box. I prefer to pay for USPS or even use email (hey, letters sent for free in less than an hour!)
There are dissolved prescription drugs in the drinking water. I buy a water filter.
And also, the public education system is a broken joke that my family opted out of. They still had to pay property taxes into the system though.
Yeaaaah, crap roads, crap food, crap water, crap service, and crap education - let's get us some more of that government!
Elle at June 21, 2010 7:14 AM
Yeaaaah, crap roads, crap food, crap water, crap service, and crap education - let's get us some more of that government!
That depends on your frame of reference. If you look at truly market driven economies like modern day Russia you'll see the mistake. The roads there are much worse because no one wants to cover the cost and then share the benifits. The water sucks all over the world, Indonesia is suffering from severe arsenic poisoning, Eastern Europe has really high levels of heavy metals, you really don't want to think about the water in China. Do we really need to go into meat from China? The main reason that small ranchers are at the edge of survival is cost. Most people would rather buy a whole crate of factory hamburger from Wall-mart than a 1 lbs steak from Whole Foods (or other organic food store). Factory farming makes the meat cheaper than ranchers can.
I'm not a huge fan of government bureaucracy but the idea that a true free market will magically make life great is just as much a myth as the greatness of socialism. The trick is finding the balance and requiring the consumer to know what they are buying.
vlad at June 21, 2010 8:19 AM
"I have never seen an article reporting on the outstanding efficiency of a government service or agency."
Read up on the Holocaust. The SS were pretty efficient. Sometimes efficiency isn't the only measure of good.
Who else remembers when all the laws were put in place after Watergate to keep the FBI and the CIA form getting too efficient? The government is being efficient when it cuts down a tree blocking your view; too intrusive when it cuts down the tree framing your view. It all depends on which neighbor you are.
"The roads aren't maintained, the meat is tainted, the water is filled with contaminants,'
The roads used to be maintianed in California, up unitl the 80's I remember very well being shocked comingg home on leave from Germany. I wonder what caused that, where all the money for road maintenance went, and why?
Tainted meat? It didn't use t be that way. it used to be inspected. When did that stop, and why? Got to get government off of people's backs, even if those people are industrial meat feed lot CAFOs.
Jim at June 21, 2010 8:29 AM
And also, the public education system is a broken joke that my family opted out of.
And your alternative to this is? I'll agree that the whole system needs an overhaul but it needs to start with parents getting their shit together and seeing school as school and not a fucking free sitter with a lottery attached. I blame the individual for most of our problems, their willful ignorance at the top of this list. Most government is there because people asked for it, not all of us but enough did. IMO a large number of people really would rather abdicate responsibility to government. It really sucks for those of us who actually want to run our own lives.
vlad at June 21, 2010 8:33 AM
To Jim (June 21, 2010 8:29 AM):
You write: "Read up on the Holocaust. The SS were pretty efficient. Sometimes efficiency isn't the only measure of good."
I would have given you the weekly prize for pointed sarcasm in the cause of denouncing government. Except, you weren't being sarcastic.
This is actually your argument for inefficient government! Your point is: It isn't bad when government is inefficient, because when they are efficient, they have efficiently controlled and killed the population.
In a greater irony, I agree with you (!) about the effects, but in the call for greatly diminished government. When government does ordinary things, they are tremendously wasteful and inefficient. When government becomes efficient, it can terrorize the population, and has done so repeatedly in history.
An efficient government is not worth the risk. An inefficient government is not worth the cost. Let's limit government.
Andrew_M_Garland at June 21, 2010 12:23 PM
"And your alternative to this is?"
Vocational schools, charter schools, more support for homeschooling families, school vouchers, merit-based pay for teachers, and getting rid of the No Child Left Behind Act so we can get the kids real education instead of prepping them for standardized tests. Giving teachers tools to help kids take charge of their own educations (this is actually my day job at the moment). All the way down to a change in the very format of education away from a lecture-based model to one that takes advantage of the differences in the way the Internet Generation processes information as opposed to works against it.
Or we could just keep the 150 year old model that's failing to teach what kids will need to know when they hit the real world; the one that leads to a 30% dropout rate nationwide; and generally fail children all around.
Elle at June 21, 2010 1:58 PM
more support for homeschooling families
With the exception of this I'm all for your suggestions. Home schooling will do even less to prepare them for the outside world. I'd like to point out that most of that those vocations schools, charter schools, vouchers are all being done. NCLBA is complete bullshit and should be abolished absolutely, this is the main reason we will be going with private school only. The problem is that unless parents instill the value of an education into the child going to the best private prep school won't do shit.
As a product of both public and vocational school I did fine and that time in a vocation helped but ONLY because my dad put foot to ass (not literally) with regards to instilling the value of learning.
vlad at June 21, 2010 2:14 PM
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