This kind of stuff really grinds my gears:
As I watch these robots slice the riser from the blowout preventer and read the news about lakes of oil moving towards the coasts of Florida, I'm wondering who to blame for this. The list is long, but, in part, I blame anyone who bought into the lines: "government is the problem" and "the era of big government is over." It's been systematic deregulation and the elevation of free market libertarian laissez-faire capitalism that have wrought this damage and allowed potentially destructive corporations to write their own rules and do as they please.
First off, this bothers me for the same reason that people who blame Wall Street for the financial collapse of a couple years ago bothered me – if you only count failures without counting successes, only those people who never try anything new or challenging will come out ahead. What I mean is, if you try to do something that's high reward, some of the time you will fail. When all you do is look at failures, you're getting a very skewed cost/benefit analysis.
In the context of wall street, the common perception was that we couldn't survive in a world where big finance was in trouble. You have to be pretty f'ing important for that to be the case. And in the private sector, where you can't throw people in jail if they don't buy your product, you don't get that kind of importance by sitting around and doing nothing. You get that important by giving people lots and lots of what they want. And when you're giving people what they want – and what they want is complex – you do make mistakes.
Fast forward 2 years and we hear the same thing again in the context of the oil spill. Oil is probably the 3rd most important substance on earth right now besides water and air, and it's getting harder and harder to extract. As with Wall Street, people don't give BP money for nothing – they give it to them for oil (and BTW, oil is probably the thing over which consumers are most sensitive about the price). And they have been providing us oil, day in and day out, for decades without even a dip in supply (except for the government-price-fixing-induced gas lines of the 70s). And here again, they do make mistakes.
If you don't want mistakes to be made, then you don't want oil (and you don't want to be able to lend and borrow money). Or is someone really willing to argue that we could have oil as available (and cheap) as it is today with fewer disasters if only the government owned the oil rigs? Given the government's track record on just about everything, that seems laughable. The fact is, the government doesn't know the first thing about drilling for oil (which Obama smartly admitted). The only places the government is competent to drill for oil is places like the middle east where it is leaking out of the ground.
Oh, but we don't want the government to actually own the rigs - just regulate them. But in what world is someone with no skin in the game going to manage something as complex as an oil rig as someone who actually owns it? Regulation may reduce disasters, but it does so only at the expense of innovation – fewer Type IIs, but more Type Is – and cost.
And by the way, they said the same thing about Wall Street. Never mind that these are already two of the most regulated industries in the country.
The second problem with Cesca's piece is that he repeats the same fundamental error that Paul Krugman made a few weeks ago:
It endlessly appealed the fines imposed as the result of Valdez oil spill and whittled the down the cost of the disaster to corporate pocket change...
So once again, a failure of government to properly force Exxon to pay for the cost of damage to property that was not their own is a failure of "laissez-faire capitalism"? C'mon.
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