Oil Spill

Calls Increasing to Punish BP, Halt Drilling

|


Offshore Oil Rig

With the ongoing oil spill continuing to wreak havoc on the environment and economies along the Gulf Coast, many in the environmental movement are starting to show their true colors. There's no doubt this spill represents a huge environmental disaster and that BP has a pretty shoddy safety record. Although the company should be held financially responsible for fixing the leak and cleaning up the mess, calls for additional punishments are going too far.

Ideas such as forcing BP to compensate oil workers affected by a government-imposed moratorium on deep-water drilling, or not allowing it to operate wells that are already in production, amount to little more than screwing the company for its past success. When all is said and done, BP will have paid out billions of dollars to cap the well, clean up the mess, and compensate the locals. It is now crystal clear that oil companies have every incentive to ensure that a similar disaster does not happen in the future. Moreover, we need the oil.

We rely on oil for things like jobs, transportation, and heating—you know, the kinds of things that make living in today's world better than Medieval Europe. In response to the argument that our economy relies heavily on oil jobs, however, comedian Bill Maher's reaction was: "Fuck your jobs!" That's easy for him to say, but the unemployment rate currently stands at 9.7 percent and, if it gets any higher, there won't be anyone left watching HBO.

"If the government hired away all the 58,000 oil workers who work now in the state of Louisiana and paid them their same salary to work repairing infrastructure and building solar panels, it would cost us $5.5 billion, which the Pentagon loses everyday in couch," said Maher on his show Real Time.

Unfortunately, the big government solution seems to be the standard response from environmentalists and others on the political left. "If something good is going to come out of this, it's going to be new ambition for the renewables," said Rachel Maddow on the same show. "We need to actually re-conceive it, get super ambitious about it, and decide that it's a really high priority for the country."

In other words, we need government to forcibly reshape the energy sector and, in the process, pick the winners and losers in the renewable energy market. If Ms. Maddow had bothered to pick up a first year economics textbook, however, she would know that none of this is necessary. Oil is a finite resource and as the supply of oil drops, its price will rise. This will send a signal to the market that there are profits to be made in new forms of energy. In this scenario, new technologies will be chosen based on their ability to compete on the free market, rather than having them handpicked by a government bureaucrat at the taxpayer's expense.

Still others are using this disaster to tout the benefits of socialism, as though the Soviet Union was a model environmental steward. Regardless of your opinion of the merits of anthropogenic global warming, it seems clear that many environmentalists are using fears over rising temperatures as an excuse to impose strict government controls on the economy. I lovingly refer to such people as watermelons (green on the outside, red on the inside) and, more often than not, they seem to be getting their way. Last week it was revealed that the federal government has doled out billions of dollars to create new green jobs, even though the Department of Labor admits to not having an accepted definition of what a green job is.

Meanwhile, Congress is coming under increased pressure to end offshore drilling altogether, and is well on its way with the recently imposed six-month moratorium on deep-water drilling. Ending offshore drilling because of this oil spill would be like ending shipping because the Titanic hit an iceberg. Thousands of drilling rigs and platforms safely operate off the coast of the U.S. everyday. But for some people, the issue appears to be less about saving the birds and more about transferring energy production from the private, to the public sector.