Sunday, June 20, 2010

Elevating Regulation: Sunday June 20 BP Oil Spill Update

1. Oil Forecast.

Tarballs were reported yesterday as far east as Panama City. Last night around here we had a small, intense wind storm race through from the East. This could be bad news for those hoping to avoid tarballs on Pensacola Beach today.

For these last few hours of official Spring, however, the oilcast looks about the same as yesterday.

2. Beach Meeting Tuesday.

County commissioner Grover Robinson IV will hold a 'town hall' meeting in the SRIA meeting room, 1 Via deLuna, Tuesday evening, June 22, from 6 to 8 pm. Specific items to be discussed include the oil spill and "the core area master plan for the beach."

It's hard to imagine the county has the chutzpah to proceed with that abomination under current circumstances. The only use we can think of for a half-mile long elevated freeway for gas guzzlers on the beach is to keep putting money in the pockets of our Middle Eastern adversaries.

The floor also will be open "for citizen comments and questions" on any other matters.

3. Oil Addiction.

The PNJ's business writer, Carleton Proctor, says today it's time to get the jones off our collective back. A day or so earlier, Carl Wernicke was awakened in the dead of night by a sudden realization that "we have lost our way."

Today, the New York Times offers some evidence to explain how we got where we are:
In the current election cycle, the oil and gas industry has contributed $12.8 million to Congressional candidates, with 71 percent of it going to Republicans.
Democrats, especially those from oil-drilling states, are not without blame.

Yes, we are addicted to oil and have lost our way. But to say that doesn't tell us how to take the cure much less what it is. All things considered, we must... must... must enact meaningful federal campaign finance reform.

Until our elected congressmen and senators are beholden to no one but the voters they'll remain obliged and in debt to the oil industry. And the oil industry will continue to pump poison into the air and water of our habitat as surely as a pusher pumps poison into his customer's veins.

4. The Pathology of Anti-Regulatory Fervor.

Speaking of business writers, the estimable James Surowiecki of The New Yorker makes a powerful case in the past week's issue for an attitudinal change in the way we think about federal agencies.

He begins with a paragraph reciting the familiar sins of M.M.S. in the Bush administration ("M.M.S. officials... let oil companies shortchange the government on oil-lease payments, accepted gifts from industry representatives, and, in some cases, literally slept with the people they were regulating.")

Then he makes a larger point:
[I]t’s hard to think of a recent disaster in the business world that wasn’t abetted by inept regulation. Mining regulators allowed operators like Massey Energy to flout safety rules. Financial regulators let A.I.G. write more than half a trillion dollars of credit-default protection without making a noise. The S.E.C. failed to spot the frauds at Enron and WorldCom, gave Bernie Madoff a clean bill of health, and decided to let Wall Street investment banks take on obscene amounts of leverage, while other regulators ignored myriad signs of fraud and recklessness in the subprime-mortgage market.

These failures weren’t accidents. They were the all too predictable result of the deregulationary fervor that has gripped Washington in recent years, pushing the message that most regulation is unnecessary at best and downright harmful at worst.
[emphasis added]

The result is that agencies have often been led by people skeptical of their own duties. This gave us the worst of both worlds: too little supervision encouraged corporate recklessness, while the existence of these agencies encouraged public complacency.

The obvious problems of graft and the revolving door between government and industry, in other words, were really symptoms of a more fundamental pathology: regulation itself became delegitimatized, seen as little more than the tool of Washington busybodies.

This erodes the kind of institutional identity that helps create esprit de corps, and often leads to politics trumping policy. Congress, meanwhile, often takes a famine-or-feast attitude toward funding, allocating less money when times are good and reinflating regulatory budgets after the inevitable disaster occurs.
Truly, this is a "pathology," as Surowiecki says. And we the voters are suffering the most from it.

Everyone is familiar with the lazy way a conscienceless politician campaigns for political office around here: thump the federal government, rail against the big, bad government agencies in faraway Washington. Then, once elected to serve in the very federal government the pol excoriates, he does everything he can to make the agencies worse.

Relying on recent research in the fields of social psychology, economics, and business, Surowiecki points out, "If we want our regulators to do better, we have to embrace a simple idea: regulation isn’t an obstacle to thriving free markets; it’s a vital part of them."

Read the whole article. It's short but compelling. And, those who leap to their feet and cheer at every mention of our servicemen in uniform may recognize Surowiecki's prescription for improving things.

5. North County.

The Pensacola News Journal today features a front page article about the oil jitters of farm folk living in "chunks of northern Escambia County." (That "chunks" is an awkward adjective, by the way, not the name of a town.)

Troy Moon took a "drive for miles up U.S. 29" into the wooded, hilly countryside and discovered there is no waterfront beach, "parasail shops," "seafood restaurants," or "girls in bikinis." Yet, he writes as if surprised some people he ran into "are as worried about the oil off the coast as other Northwest Florida residents."

Whad' da ya' know? They have human concerns in north county, too! They worry over the loss of tourist income, the poisoning of seafood, and whether the soil might be contaminated by "chemicals dumped in fields."

No doubt, Troy also paid a professional courtesy call on the one knowledgeable, steady public voice of the rolling hills of Odd that he didn't mention it.

6. Gannett Supplement.

Rick Outzen more or less predicted it would be a shameless "way to make more money off disaster." Having read through the copy of the PNJ's Oil Spill Supplement that came with our dead tree paper this morning, we prefer to think of it as a gift to all the Martian creatures who just landed on Earth and needed to be briefed.

7. Trading Billions.

Tom Dispatch, reprinted by CBS News, pointed out yesterday that while the president has been on the verbal warpath against BP Corp., the U.S. military has -- with little notice -- continued to carry on a major business partnership with the oil company that's poisoning the Gulf, despite BP's disastrous environmental record:
[T]he Department of Defense paid out more than $1.5 billion to BP alone and a total of $8 billion taxpayer dollars, in total, to energy-related firms on what is a far-from-complete list of companies.
* * *
The largest contractor, however, was BP, which received more than $2.2
billion -- almost 12% of all petroleum-contract dollars awarded by the Pentagon for the year.
* * *
BP received around $5.7 billion in federal contracts, according to official government data. In fact, the $2.2 billion the Pentagon paid to the oil giant in 2009 accounted for almost 16% of the company’s nearly $14 billion in annual profits.

This fiscal year, the U.S. military has already awarded the company more than $837 million, inking its latest deal with BP in March.
Should we apologize to BP that we haven't paid them more? Let's ask Joe Barton.

8. Wall Street Journal Editorial Board: The Joe Barton of Journalism?

Jim Hopkins' "Gannett Blog" has some good things to say about an earlier USA Today piece cocnerning the oil spill. Then, he saw the Wall Street Journal's "famously conservative editorial page" had a minor cavil over USA Today's numbers.

What Hopkins wants to know is, Did the Wall Street Journal editors provide "important context" as they claim, or are they "once more kissing corporate butt?" He reports, you deride.

9. Volunteer Opportunity.

The Gulf Islands National Park Service is asking for volunteers, and it doesn't require handling tarballs. Click the image below for details:


Anonymous said...

This is a step in the right direct...bad choice of is some good news

Daniel Ewert said...

It is amazing that some politicians still want to deregulate the oil industry even in the face of this.