http://online.wsj.com/article/SB10001424052748703900004575325131111637728.html?mod=WSJ_WSJ_US_News_5
BP PLC and other big oil companies based their plans for responding to a big oil spill in the Gulf of Mexico on U.S. government projections that gave very low odds of oil hitting shore, even in the case of a spill much larger than the current one.
The government models, which oil companies are required to use but have not been updated since 2004, assumed that most of the oil would rapidly evaporate or get broken up by waves or weather. In the weeks since the Deepwater Horizon caught fire and sank, real life has proven these models, prepared by the Interior Department's Mineral Management Service, wrong.
As the article clearly states, the oil companies were REQUIRED to use the government projections when formulating their own disaster reaction plans. REQUIRED. But now that the disaster has hit, BP is being held SOLELY responsible for the damages. We can sue BP, but we can't sue the government, even though they share some of the responsibility, here.
Don't get me wrong, BP should be liable for the damages. Their rig, their spill, their liability. But the government regulated them and forced them to do things certain ways, and that creates a partial liability on the part of the US government.
And this, in my opinion, is the fundamental problem with government regulating private businesses. When the GOVERNMENT makes a mistake, the regulated company pays for it. And that's wrong.
Another failure of government regulation is the $75 million liability cap. Without that law, there would be no questions about ultimate liability. But our government decided, in its infinite wisdom, that they'd add that little regulation into the books.
So now we have TWO aspects of government regulation that have combined to make a bad situation even worse than it had to be.
Whats strange here...is the various rush jobs underway in the Senate and House....with 2,000 page "repairs"....and here's this $75 million limit, with no mention of a fix for it.
ReplyDeleteI think we ought to invest a week and write a 2,800 page bill and fix this...with all the bells attached. Naturally....by the end, we'd only up the $75 million deal to $85 million (after tax credits and various exclusions).
I think we need to fire every Congressman who believes that the solution to every problem involves writing new "comprehensive" laws that are thousands of pages long. You know, laws that are so large and complicated that nobody knows how they will work until after they've passed and are implemented.
ReplyDeleteI'd also favor changing things around so that Congress only meet every other year... and so that concrete limits are place on the President's power... upon pain of impeachment, prosecution, and imprisonment.
but that may just be me.