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July 18, 2010

The punishment suggests the crime

Filed under: Law, Politics — Tags: , , — Lucia Graves @ 5:34 pm

The “obsession” with the word criminal, to be clear, has everything to do with making sure BP pays. It has to do with compensating the families of the aggrieved. It has to do with restoring the Gulf Coast and its wildlife. It also has to do with making sure that something like this never happens again. BP can’t bring back the dead or restore the environment they’ve ruined. Instead they are just being asked to pay for righting some of the devastation they’ve caused. There’s not a clear price tag for these things, and I think there is no price tag, but paying is the least they can do.

The question is whether we have a legal system in place that can make them pay for the damage they’ve caused. The answer is probably not, but public outrage has pressured BP into agreeing to the $20 billion escrow account — they are not, after all, politically suicidal. The punishment suggests the crime.

As for Mr. Butter’s argument about BP’s track record being irrelevant – I could hardly disagree more. This disaster did not happen in a vacuum. It’s critical that we understand the context if we are to prevent it from happening again.

The claim that “the safety record of BP’s offshore operations is pretty good” is also not true. They have the worst record in the industry, and the evidence for that is widely available. Just last year BP was found to have 700 individual safety violations at its Texas City refinery and was fined a record $87 million for damages. The CPI study I cited earlier shows that only one other refinery has received an “egregious willful” citation between June 2007 and February 2010 — and that was a single citation, compared to BP’s 760 during the same period.

Mr. Butter’s next point — that because BP bought its oil refineries, the culture there was not particularly BP’s — doesn’t hold either. They bought the refineries and ran them. The leadership and tone was their own. As the supervisor from BP’s Atlantis who was fired for expressing safety concerns explained: “Management sets the tone. If they think that production is more important than safety, then that’s the tone of the company, and that was the tone at Atlantis.”

The assertion that the U.S. oil industry is “very highly regulated,” seems humorous. The Minerals Management Agency’s performance has been completely inadequate and there has been extensive documentation of the agency’s cozy relationship with big oil. Even President Obama is making those charges: “Over the last decade, this agency has become emblematic of a failed philosophy that views all regulation with hostility – a philosophy that says corporations should be allowed to play by their own rules and police themselves,” he said, as he addressed the nation about the state of the spill. “At this agency, industry insiders were put in charge of industry oversight. Oil companies showered regulators with gifts and favors, and were essentially allowed to conduct their own safety inspections and write their own regulations.” It’s not a coincidence that the head of the agency, Elizabeth Birnbaum, was fired in the wake of the disaster.

There is certainly enough blame to go around. Indeed Attorney General Eric Holder has announced that the Justice Department’s criminal investigation into the Deepwater Horizon incident may cast a much wider net than just BP. “There are a variety of entities and a variety of people who are the subjects of that investigation,” Holder said in an interview with CBS’s Bob Schieffer. “For people to conclude that BP is the focus of this investigation might not be correct.” The investigation is ongoing and Holder suggested the investigation may extend well beyond the companies directly involved with Deepwater Horizon. He said there’s a “certain commonality of the way oil companies had been operating” in the Gulf.

But though there is enough responsibility for all concerned parties, and I do believe each entity should accept their share of responsibility, the shortcomings of the MMS et al constitute quite a different debate. I’ll return to refuting Mr. Butter’s claims.

To call the safety record of BP’s Deepwater Horizon rig “impeccable” is clearly wrong — I do not like even repeating that argument, because I feel doing so lends it credence. There is plenty of documentation that in nine years at sea BP’s Deepwater Horizon oil rig suffered a series of spills, fires — even a collision — due to equipment failure and other problems. If Mr. Butter wants to dispute the facts, he should provide some documentation.

One last point: Mr. Butter has said that if BP is made to pay for the damages to the Gulf that that will bad news for everyone in America who drives a car because it will make oil more expensive. But the big picture is that it will be good news for the whole world, if we will only allow ourselves to learn from this disaster.

The larger lesson here is that drilling for oil is a dangerous business and that oil is a finite resource that we must transition away from. America holds less than 2 percent of the world’s oil reserves but consumes more than 20 percent of the world’s oil. We know, and we’ve known, that our addiction is unsustainable.

Americans have talked for decades about ending our dependency on fossil fuels and for decades we have failed to embrace clean energy. Now there’s an opportunity to seize the moment. If we do it will be good news not only for the world, but for our children and for our children’s children.

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