Saturday, May 29, 2010

BP's "Top Kill" Effort Fails - This Could Be Big

This could be really big.

I just heard the word that BP's best hope at stopping the oil flow, the "Top Kill" method, has failed. I wonder about the long term consequences now. I think it is misleading to think of this as a "spill", it's way beyond that. There is now a real possibility that the flow of oil could continue for years until most of the oil in that entire oil field has been emptied out into the gulf. People who have depended on catching fish and shrimp for generations in that area now say it is unlikely that they will be able to go back and resume their livelihoods at anytime during the rest of their lives. These are some of the same people hit hard by Katrina. And this is predicted to be another bad year for hurricanes. My heart goes out to these people.

What to do about BP? Traditional fines don't seem adequate in this case. I would support a permanent ban on BP doing any more offshore drilling off the coast of the U.S. They have demonstrated that they are not capable of doing this safely. That would make the rest of the industry think more seriously about safety. What if in the end it becomes apparent that no "for profit" corporation can drill for oil with adequate safety in water that is a mile deep or more? That is a real possibility that we must be prepared to accept.

There is an argument that BP is not a "bad company", it is just doing what all companies are chartered to do under the current system - maximize their short term profits. In this argument, there are no bad or good companies, there are just companies that do what companies are designed to do. Don't expect anything else to happen when we have set up the system to produce these results.

What is the long term impact of this? Instead of thinking about this as "Obama's Katrina", perhaps it is better to think about it as "Obama's 9/11". It's an unexpected event that could end up defining his presidency and shaping his policy focus in unexpected ways. This could have implications to national policy related to energy, the environment, and possibly to the way corporations are chartered and regulated. This could be big.

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