Five years after Hurricane Katrina, the BP oil spill offers a chance to learn a lesson that we should have learned five years ago. Certainly, the two events differ in important ways – the hurricane itself was a force of nature, and the oil well blowout although powered by nature, was clearly the result of human activity. But the hurricane was not just a natural disaster. Its impact resulted from a series of human decisions and actions that exacerbated the hurricane’s effects and impaired the response effort. The lesson we should learn from these disasters is this: numbers may not lie, but they will fool us if we let them. Numbers – like those that predict how likely a disaster is, or the cost of taking steps to prevent a disaster – can be a helpful tool as we make decisions, like what kinds of levees to build and whether to allow oil drilling in a particular area. But the problem with numbers is the very thing we love most about them. They’re so precise. They seem to give us “the answer”.
The problem is that numbers appear much more certain than they are. They give you an answer, but it’s a mistake to assume the answer is the right one. There’s truth to the saying that statistics are like prisoners of war – torture them enough and they’ll tell you anything you want. For example, there are many different ways to calculate the odds of a disaster happening. As Professor Dan Farber of Berkeley has pointed out, the odds may be that a single oil well in the Gulf of Mexico will blow out only once every 8,000 years, which sounds pretty safe. But if there are 800 manned oil wells in the Gulf, that means that we should expect one blowout every ten years – a very different picture. The odds of Katrina hitting New Orleans were very low, but the odds that a hundred year storm would hit New Orleans at some point were quite high. So the fact that a catastrophe is of low probability is not an answer to the question ofwhether we want to risk the consequences. That requires an exercise of judgment. The odds that your house will burn down are very low. But most people buy homeowners insurance because of just that risk. When we make important policy decisions, we need to act the way prudent homeowners do – consider the worst case scenarios and decide if we’re willing to risk the downside.Full text
Senate Bill 3516, introduced by Senators Bingaman and Murkowski in response to the BP oil spill to reform the Outer Continental Shelf Lands Act (OCSLA), proposes many intelligent and much-needed changes (the Energy & Natural Resources Committee will hold a hearing on the bill today). Among these, the legislation would imposea long-overdue mandate for best available technology for oil exploration and extraction, require that proponents of drilling evaluate the possibility of a well blowout and develop a response plan for a blowout, require a review of royalty and bonding requirements, and increase from 30 to 90 days the timeframe for the agency to review exploration plans, with an option for an extension if needed. The legislation would also significantly improve the structure of what was MMS (now the Bureau of Ocean Energy Management, Regulation and Enforcement) to separate incompatible functions, enhance the agency’s enforcement and investigative powers and its capacity to assess the environmental impacts and safety of proposed drilling operations, and build agency expertise in the technology and risks associated with OCS oil drilling through a research program. These are all very positive steps and a responsible response to the immediate crisis and the most patent problems with the OCSLA that this disaster has revealed.
These fixes would not be enough to get the job done, though. Perhaps it’s expecting too much of one bill, but the risk is that once Congress addresses reform of the OCSLA in a comprehensive bill like S.3516, there will almost certainly not be a second chance. That's just how lawmaking in response to disasters works.
The OCSLA was a statute in desperate need of updating and reform. There are fundamental shortcomings that remain untouched by S.3516 and that contributed to the outcome we face today: unprecedented, unimaginable, and incalculable damage to the natural resources in the Gulf of Mexico and the attendant devastating effects on the lives of people who depended on those resources.Full text
In following the oil spill disaster, it can be hard to think beyond the control effort du jour to the bigger picture. I was riveted by the latest of BP’s seven failed efforts to stop the flow of oil, hoping it would succeed and that the underwater tornado of oil devastating the Gulf, the coast, and the people whose livelihoods depend on these natural resources, would be contained, at least. And now that the top kill has failed, we’re all holding our breath for the next containment dome, hoping against all odds that this one will work. Even if we do think a little more broadly beyond the control and response efforts, the most immediate question seems to be how to reform MMS, the agency whose oversight of BP and other oil companies was so compromised and inadequate.
But it’s crucial that we wrench our attention away from the BP webcam, the drama of the efforts to staunch the out-of-control well, and the soap opera of MMS’s ethical failings. We need to step back and consider the larger lessons of this disaster. The tectonic forces that brought us to this point aren’t ever going to make headlines. And if we don’t learn what brought us to this horrible place, you can be sure we’ll be back here again soon. The fundamental lesson we need to learn is this: we don’t need smaller government and less regulation, we need effective government and effective regulation.
Now, in this moment of crisis, we realize how much we need and depend on government to protect us. By “we”, the public, I mean the workers who were killed in the explosion, the fisherman and other workers who depend on the Gulf for their livelihoods, and all of us who are affected by the horrible fouling of the Gulf and the marine creatures who live there. And now, too late, we realize that BP and other private corporations are not going to protect our interests. The echoes of the financial crisis are almost earsplitting.Full text