Doesn’t the BP Scandal Prove We Need More Government?!


First of all, what happened?

Wikipedia gives us the highlights:

The Deepwater Horizon oil spill (also referred to as the BP oil spill, the BP oil disaster, the Gulf of Mexico oil spill, and the Macondo blowout) is an industrial disaster that began on April 20, 2010, in the Gulf of Mexico on the BP-operated Macondo Prospect.

Killing eleven people, it is considered the largest marine oil spill in the history of the petroleum industry and estimated to be 8% to 31% larger in volume than the previous largest, the Ixtoc I oil spill. The U.S. government estimated the total discharge at 4.9 million barrels. After several failed efforts to contain the flow, the well was declared sealed on September 19, 2010.

Reports in early 2012 indicated that the well site was still leaking.

A massive response ensued to protect beaches, wetlands and estuaries from the spreading oil utilizing skimmer ships, floating booms, controlled burns and 1.84 million US gallons of oil dispersant. Due to the months-long spill, along with adverse effects from the response and cleanup activities, extensive damage to marine and wildlife habitats and fishing and tourism industries was reported.

Oil cleanup crews worked four days a week on 55 miles of Louisiana shoreline throughout 2013. Oil continued to be found as far from the Macondo site as the waters off the Florida Panhandle and Tampa Bay, where scientists said the oil and dispersant mixture is embedded in the sand. In April 2013, it was reported that dolphins and other marine life continued to die in record numbers with infant dolphins dying at six times the normal rate.

Numerous investigations explored the causes of the explosion and record-setting spill. The U.S. government September 2011 report pointed to defective cement on the well, faulting mostly BP, but also rig operator Transocean and contractor Halliburton. Earlier in 2011, a White House commission likewise blamed BP and its partners for a series of cost-cutting decisions and an inadequate safety system but also concluded that the spill resulted from “systemic” root causes and “absent significant reform in both industry practices and government policies, might well recur”.

In November 2012, BP and the United States Department of Justice settled federal criminal charges with BP pleading guilty to 11 counts of manslaughter, two misdemeanors, and a felony count of lying to Congress. BP also agreed to four years of government monitoring of its safety practices and ethics, and the Environmental Protection Agency announced that BP would be temporarily banned from new contracts with the US government. As of February 2013, criminal and civil settlements and payments to a trust fund had cost the company $42.2 billion.

In September 2014, a U.S. District Court judge ruled that BP was primarily responsible for the oil spill because of its gross negligence and reckless conduct. In July 2015, BP agreed to pay $18.7 billion in fines, the largest corporate settlement in U.S. history.

There have been similar leaks and almost-leaks at nuclear plants, and the like. The government prefers using bogeymen to scare us since these can be safely shut down and interchanged as needed. Serious emergencies merely reduce the public trust in the state. Indeed, there are several ongoing threats (such as massive debt and entitlements, the accumulating space debris Commons problem, the anti-population growth people) which are ignored because they serve no positive political purpose.

Private companies have no motivation to disclose them, either. And, again, the government has no interest in forcing them to.

If the government puts an unpopular defendant on trial, the result is foreknown. If the government played a role in enabling the crime, through moral hazard and government-quality regulation, the result is even more obvious. If the judgment is a question of paying fines to the employers of the judges, even more so.

When decisions pertaining to the public weal are socialized via government or private-public collusion, the true factor is only the bureaucratic refrain of “How can I keep my job safe?”

Thomas Sowell: “It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong.”

So that’s how we do it…

Making business government-like means we will get more of those kinds of deception we have grown to know and resign ourselves to.

Lessons will never be learned, either.

I don’t have the latest Block “Defending” book, but here’s a summary of his comments on the BP spill via

British Petroleum is a good hard case because everyone knows about the accident in the Gulf of Mexico, the 200 million gallons of oil that was spilled, and that BP has been vilified by the media pundits and politicians because of it. Block begins by calling the people at BP heroes in part because they do the dangerous work so we can comfortably drive across town at 10 cents a mile.

Block asks if BP knew the dangers of deepwater drilling. Of course they did, but government regulations prevent shallow water drilling near the shoreline and provide incentives to drill in deep water far out at sea. Meanwhile, government regulators were not doing their job, goofing off, taking bribes, and they failed to upgrade safety standards to account for the new deepwater drilling.

As BP was vilified for negligence and as the oil continued to seep into the gulf, the U.S. government turned down offers of assistance from foreign companies that specialized in such spills and who had more experience than U.S. firms. Ships from foreign countries also offered their assistance, but like after Hurricane Katrina, the volunteers were turned away. Block argues persuasively why such disasters are very unlikely to happen in a libertarian society and that this tragedy was the result of government intervention.

Comments are closed, but trackbacks and pingbacks are open.