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Wednesday, June 02, 2010

Criminal Charges Coming for BP?

BP's underwater leak gushes crudeBP's efforts to control their gusher in the Gulf of Mexico has hit another little snag. Undersea robots with diamond saws are cutting through the pipe, in order to fit it with what even they concede would be a leaky cap. In the process of doing this, one of the saws is currently stuck. OK, I understand that the pressures five miles beneath the sea are pretty intense, but isn't the pipe they're cutting spewing oil? Oil that has well-known lubricating qualities? How could it be stuck? "If at first you don't succeed, try again. Fail better," is starting to look like BP's motto.

The ongoing crisis would be a comedy of errors, if the consequences weren't so deadly serious. The way of life everyone knew in the Gulf of Mexico may very well be over for at least a generation, if not more, and irreplaceable wetlands and species could be wiped out. Given what's at stake here, one thing is becoming clearer and clearer -- at least to me -- we shouldn't have been doing this deepwater drilling in the first place. A lot of attention has been given to the concept of prevention, but humans being what humans are, we can't make disaster impossible. We can make it less likely, but that's what we thought we did. Turns out we didn't. Corners were cut, laws were likely broken, safety measures were ignored. And, even if every precaution had been taken, if all the laws had been obeyed -- in fact, if BP had gone beyond the requirements and put extra safeguards in place -- no one would honestly be able to say that a disaster like this had been made completely impossible. And we never will. Machines break down, people screw up, the earth itself does unpredictable things. Preventing petroleum contaminations like this are extremely important, but it's only 50% of what should be our concern and the focus of our research. The other 50% should be mitigation and we haven't done a damned thing in that area. The unthinkable has happened and we have no idea what to do. Turns out we got way ahead of ourselves on this one. We're just poking around in the dark.

But there are consequences other than the wetlands and the species and the livelihoods and the public health. There is the law. For their part, the Obama administration is moving to see to it that those consequences come through.

McClatchy Newspapers:

Responding to criticism that it hasn't been forceful enough in its response to the largest oil spill in U.S. history, the Obama administration on Tuesday announced a criminal investigation into the deadly explosion and installed a no-nonsense Coast Guard admiral as the public face of the response, instead of BP.

The effect of the April 20 spill, including "oil for miles and miles" in the Gulf of Mexico, is "heartbreaking to see," Attorney General Eric Holder said Tuesday afternoon during a visit to New Orleans. He also pledged not to forget the 11 lives lost in the explosion.

The nation has an obligation to "investigate what went wrong and to determine what reforms are needed so that we never have to experience a crisis like this again," President Barack Obama said after meeting at the White House with the two men he'd appointed to head an inquiry into the blast.

"If our laws were broken, leading to this death and destruction, my solemn pledge is that we will bring those responsible to justice on behalf of the victims of this catastrophe and the people of the Gulf region," the president said.

If you're picturing BP execs behind bars -- or even in court -- you'll probably be disappointed. "It's highly unlikely that senior managers of the company were sufficiently personally involved in this to be charged," said David Uhlmann, a University of Michigan professor and former prosecutor specializing in environmental crimes told Politico's Josh Gerstein.

"It doesn't mean BP executives are going to be wearing stripes," agreed David Pettit, an attorney with the Natural Resources Defense Council. "If corporations are criminally prosecuted, it's usually resolved in some lawyers' offices."

But the move opens other doors. Right now, BP is under a $75 million liability cap -- which is an insanely small amount of money when compared to the billions this incident is likely to cost. Congress has resisted raising the cap, because they worry that it'd dissuade companies from doing this stupid, stupid, stupid deepsea drilling and this would somehow be bad. I'm not extremely clear on how, but congress has never needed a decent argument before. If BP is guilty of crimes, that all changes.

Writing for Business Insider last month, Gus Lubin reported, "Criminal charges would put an axe through a $75 million cap on civil charges for oil pollution." This is why, after the criminal investigation was announced, BP's stock dropped. In fact, since the Deepwater Horizon wreck, the company has already lost $75 billion in market value.

If this puts off other companies from investing in deepwater drilling, as some in congress fear, then what does that say about the safety of such ventures? Corporations won't want to drill, because the monetary consequences of a screw up would be too great. Isn't this an admission that they see another deepsea disaster as a real -- and prohibitively likely -- possibility? Put a lot of money on the line and suddenly it becomes a bad bet.

If the criminal probe keeps corporations out of the deep water, then it's hard to see this as an argument against it. If corporations don't think their money is safe with these wells, why should we believe these wells are safe at all?


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