How’s All That Progressive Regulatory Stuff Workin’ Out For Ya?
Posted by Kevin Carson on Jun 8, 2010 in Commentary • 3 commentsIn a previous column (“BP’s Fate in a Free Market, Part Two“), I discussed the possible ways that unlimited tort liability might discipline corporate polluters and other malfeasors in a free market regime. Total damages from a spill like Deepwater Horizon, if not enough to liquidate all the assets of a company like BP, would probably eat up enough of their ongoing revenue stream for many years to amount to a corporate death sentence. The resulting market pressures to maintain robust liability insurance would be intense, and the economic incentives for insurers to impose effective safety regimes would be overwhelming.
But look at the other side of the scale. How’s the much-vaunted regulatory state actually been performing? BP management deliberately skimped on safety measures, neglected maintenance on multiple levels of failsafe mechanisms because they cut into profits, and slept (and snorted crystal meth) with government inspectors.
Now one could argue, and that quite plausibly, that this was a holdover from the Bush years, when Exxon-Mobil lobbyists wrote environmental policy on hunting trips with Dick Cheney.
But that doesn’t explain the farce put on by Tony Hayward and Barack Obama since the spill happened. While emoting in TV ads, saying all the right things about “earning the public trust” and “making things right,” what has Hayward actually been doing? From what I’ve seen on CNN, the skimmers and cleanup crews actually assigned to controlling damage are a tiny fraction of the resources that could be brought to bear, if BP hired all the specialists and contract workers available for the job. Instead, they’ve spent what amounts to a few days’ total profits. BP brought in ringers to pad the cleanup effort a hundredfold for Obama’s appearance, while warning their cleanup workers not to talk to the press. BP told cleanup workers they didn’t need safety gear like masks and gloves — mainly because the sight of all those people in spacesuits would be really bad PR — and (again) warned them not to talk to the press. BP has refused to share its inside knowledge of the chemical composition of its dispersants, which means the cleanup workers, public and ecosystem are subject to God only knows what kinds of risks. The average age of cleanup workers from the Exxon-Valdez spill today is 51, some talking head on CNN said today, and most of them are dead.
Despite all his superficially assuring promises to make good on all damages, on closer inspection Hayward shows himself to be as much a master of “what is is” as Bill Clinton. Notice how he keeps inserting that “all valid claims” qualifier? That means, according to my crystal ball, that BP will fight every single claim to the highest available court of appeals, and will end up paying only the “valid claims” of those fishermen rich enough to afford a gazillion dollars in legal fees.
In short, while boohooing like Iron Eyes Cody in his tearjerker TV ads, Hayward is displaying exactly the same leadership style that created the mess in the first place: cutting corners, doing things on the cheap, stonewalling, shining it on and covering up.
And what is our “progressive” government doing about it? Hayward’s not even getting the kind of grilling the Detroit CEOs got before Congress (remember how they fidgeted about the corporate jets?). Let alone any tough talk about criminal prosecutions from the Justice Department.
Imagine the treatment you’d get from the government if you owed them $1000, and contrast that with the government’s treatment of a man who was almost certainly criminally negligent in causing billions of dollars worth of damage.
Think: this is the most “progressive” president, with the largest Democratic majority, likely to be elected in a generation. If this guy lacks the political will to make full use of the powers available to him in holding a dirtbag like Hayward accountable in a smoking gun case like this, what good’s a regulatory state?
A regulatory state that works properly only when completely staffed with Dudley Do-Rights, who never sleep on the job (especially with the people they’re supposed to be regulating) is a regulatory state that will never work. In the real world, government is a lot more apt to protect the corporations against you than vice versa.
C4SS (c4ss.org) Research Associate Kevin Carson is a contemporary mutualist author and individualist anarchist whose written work includes Studies in Mutualist Political Economy, Organization Theory: A Libertarian Perspective, and The Homebrew Industrial Revolution: A Low-Overhead Manifesto, all of which are freely available online. Carson has also written for such print publications as The Freeman: Ideas on Liberty and a variety of internet-based journals and blogs, including Just Things, The Art of the Possible, the P2P Foundation and his own Mutualist Blog.
I can't disagree, Kevin; I can just note that it seems you really pulled your punches for Obama and his administration, which has been doing its best to help BP understate the size of the actual problem, to hide it with vast quanities of highly poisonous dispersants, and to hamper the ability of the press and citizens to see and report on the spill.
None of this is forgiveable, though an explanation might be fashioned that Obama has been trying to elicit support from the oil and gas industries for legislative efforts to price carbon.
Unlimited tort liability would be a good thing. But statutory limitations on liability are far from the only the barriers preventing injured parties from using the judicial system to hold corporate criminals accountable. The courts themselves have set up many doctrines and practices designed to prevent such use of the courts – from the doctrines of justiciability, such as standing and ripeness, which are designed from keeping many issues out of the courts, to tort doctrines like contributory negligence, which skew results in favor of defendants. The judicial system would have to be radically overhauled before it could effectively function as a regulator of corporations.
To say that the regulatory state does not work requires a more rigorous analysis. The question you need to ask is this:
Has the regulatory state ever worked in this country or elsewhere, using realistic standards of defining what it means to "work". Condemming anything short of perfection as proof that government does not work fits into the libertarian mindset but is not a rational approach to the world. If there is empirical evidence that regulations have worked then we need to ask why it failed so miserably in the case of the BP oil spill. I would argue that regulations have worked fairly well over the years in that the quality of our water and air has improved over the years in some ways since environmental regulations were enacted., as weak as they are. So why did they fail in this case? Could something have been done differently to have prevented this? Don't take me wrong, in a theoretical way I am a left wing anarchist but I find that theory and reality are very different. In theory love is a wonderful thing but in reality how many happy marriages are there?