by Randolph T. Holhut
American Reporter Correspondent
June 4, 2010
SELF-REGULATION IS A DISASTER FOR AMERICAN BUSINESS
DUMMERSTON, Vt. -- If the old definition of a conservative is "a liberal who's been mugged," is the new definition of a liberal now "a conservative who's had his beachfront property coated in crude oil?"
So many Americans today say they hate government, until they need its help and change their tune. That's the paradox we're seeing after an exploded oil platform in the Gulf of Mexico spewed more crude oil than the Exxon Valdez dumped into Alaska's Prince William Sound in 1999.
People are criticizing the Obama Administration for doing too little to protect the environment in and around the Gulf of Mexico But the federal government can do little because it does not have the means of stopping the flow of oil when a rig explodes and sinks. It also does not have the power to effectively regulate oil companies like BP, because three decades of deregulation has promoted the insane idea that companies can regulate themselves.
The Wall Street Journal reported a few weeks ago that Statoil rigs in the North Sea, run by the Norwegian state-owned oil company Statoil Hydro, are required by law to maintain special "acoustic switches" that shut down operations completely and remotely in case of a blowout or explosion. That is one reason why Norway has a solid record for environmental safety in drilling for offshore oil. Brazil also requires these switches for offshore rigs.
By comparison, the U.S. Minerals Management Service decided that oil rigs operating in American waters would not have to install those switches. It had considered making these switches mandatory, but the industry-friendly Bush Administration bowed to the protests of the oil companies, which did not want to spend the required $500,000 per switch. The Obama Administration has yet to change this policy.
The oil companies claimed that their primary shutoff measures were enough to control an oil spill. As recently as last year, BP was arguing against stricter safety measures; it said that voluntary safety measures were sufficient. Considering how much it's going to cost BP to clean up this spill, $500,000 now looks like a bargain.
As columnist Joe Conason pointed out on Salon.com last month, there is one big difference between the Norwegians, who have been safely drilling in the North Sea for nearly four decades, and the United States, which has seen more than 500 fires on oil platforms in the Gulf of Mexico since 2006.
"The Norwegian state can impose public values on oil producers without fighting off lobbyists and crooked politicians, because it owns and controls the resources," wrote Conason. "Rather than Halliburton-style corporate management controlling the government and blocking environmental improvement, Norway's system works the other way around."
These days, the concept of public good is ridiculed by conservatives. They speak of "the magic of the marketplace" and "enlightened self-interest" as being all that's needed to keep companies in line. After three decades of deregulation and the gutting of government agencies designed to enforce public safety, health and welfare, we know how well that philosophy has worked out.
Government regulators stopped watching the financial industry, and we got Enron and Goldman Sachs. They stopped watching the coal mines, and we got deadly mining disasters. They stopped inspecting food processors, and we got salmonella and E.coli outbreaks. By changing the focus from the public good to the good of corporations, we've seen time and time again how a select few reap profits while everyone else has to clean up the mess.
That's how BP was allowed to get away with oil rigs without effective backup systems. Saving the company $500,000 per platform was more important than protecting an environmentally sensitive area from disaster.
Whether it's a coal mine in West Virginia, a peanut butter plant in Georgia or an oil rig off the coast of Louisiana, we've seen nothing but disaster when corporations are allowed to self-regulate. The only protection against the rapaciousness of industry is a government that is willing to set and enforce the rules and puts people ahead of profits.
Randolph T. Holhut has been a journalist in New England for more than 30 years. He edited "The George Seldes Reader" (Barricade Books). He can be reached at email@example.com.