Monday, 31 May 2010

Dear Conservatives

One of the things that bothers me about "conservative" political movements is that in spite of their advocacy of self-reliance, private enterprise and limited government (which I agree with!), in times of trouble their members tend to look to the government to solve problems. It happens in economic crises and national disasters, it happens with trade and farm subsidies, and now it's happening again with the BP oil spill. Private enterprise created the problem, surely private enterprise can solve it? Why are conservative pundits blaming the federal government for not solving it?

Yeah, I know why.



36 comments:

  1. If government is so good at doing things, why have they not plugged the blown out oil well in the Gulf of Mexico?
    Yeah, I know why, too.

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  2. Robert O'Callahan31 May 2010 23:24

    It's conservatives who are pinning their hopes on the government, not me.

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  3. Who actually owns/controls the off-shore rights? Who requires BP to get permission for everything they do out there? Who does Louisiana have to get permission from for anything they attempt to do?

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  4. Robert O'Callahan1 June 2010 00:09

    As far as I know, BP has been able to do whatever they want at the rig site.

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  5. "Who requires BP to get permission for everything they do out there?"
    Actually, the previous conservative administration granted BP numerous waivers to go ahead with the drilling (and not just BP, many other oil companies at other rigs) without going through the full environmental, structural, etc studies to verify that the rig was safe.

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  6. Apparently the US government has not developed the skills and equipment to plug oil wells a mile under water. If we expect them to do that in the future, we're going to need to actually pay for developing that capability and taxing the profits of the world's wealthiest energy companies seems like a fine way to do it.
    (They do, however, have the skills and equipment to do more to protect the shore life, human and animal and they need to get on that like yesterday!)
    What the US government does have the skills and equipment to do is to REQUIRE that private industry be prepared for worst case scenarios that could devastate regional economies and environment. Regulation that mandates that private industries be capable of cleaning up after themselves is not that hard and something the US government did quite well for a couple hundred years.
    During the last two administrations, apparently, our leaders decided that regulation to prevent this kind of catastrophe wasn't as important as campaign cash. Clinton and Bush are as much responsible for this as BP and Transocean. (and Bush and Reagan before them deserve some of the credit/blame too)

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  7. Michael Burns1 June 2010 01:41

    Well said Mr. O'Callahan. Government isn't capable of doing half the things the promise people. They often just promise it to be elected and throw money and regulation at problems to try to make it look like they are fixing it so they can be re-elected (or help friends and/or interest groups). Meanwhile, the problem resolves itself. Although the BP incident won't resolve itself, the US government doesn't have the ability to do anything useful, yet politicians won't shut up about it.

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  8. Oh dear, now you've let the cat among the pigeons :)
    Limited government is not the same as no government. There are still things which only government can do, like manage the military and coordinate efforts to clean up disasters.
    BP is at least trying, even if they're not doing well, but I suspect they'd do better if they had proper government help similar to how government would help in a natural disaster.

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  9. As Asa said above, the government doesn't have the infrastructure to clean up oil spills, and has never attempted to develop it.
    It'll be interesting to see if that changes after the BP spill. In fact this is the sort of thing governments should be much better at than private corporations. The victims of this disaster are public, so the public should be able to hold politicians to account. Governments can mobilize the military to bring massive amounts of manpower, as long as they're properly equipped, and governments are best equipped to handle the risk and uncertainty associated with rare but extremely costly events.
    But Americans are so anti-government that I suspect even a huge disaster like this won't convince them to let government do what it's best at.

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  10. The question is based on faulty assumptions. First, BP's license to drill required a 500+ page document, that detailed what the company would do in the case of various disasters, including a blowout. There are valid criticisms of that section of the document ( http://climateaudit.org/2010/05/30/the-bp-oil-spill-response-plan/ ), but you don't get to pretend that the document doesn't exist.
    Second, according to that document, there are private companies who claimed to have the ability to handle a spill of this magnitude. It appears they oversold themselves and BP may not have done enough due diligence. In a "normal" malfunction of this type, safety equipment already in place would have prevented the disaster from happening at all. Unfortunately that equipment malfunctioned as well, and there was apparently no redundancy. It's obvious today that there should have been redundancy, but the relevant government regulations did not require it. If BP deserves blame for not adding the redundancy, then the government must share some of that blame for not requiring it.
    Finally, while I am not entirely convinced, there is a valid argument that the government should be responsible for spills that are significantly outside the norm. The best example I can think of comes from Alan Greenspan's book (Age of Turbulence): Greenspan believes financial companies should be expected to handle the kinds of recessions that happen once a decade. However, he believes that recessions or depressions that happen once a century should be the government's responsibility. His argument is simple: if a company had to have enough cash on hand at all times to weather the next Great Depression, then that company would be somewhat hampered when the economy was in good shape. They wouldn't be able to use money in good times because that would need to be held in reserve "just in case."
    Again, I'm not convinced of this rationale for bailouts. But it is a valid argument, and I believe there is a parallel argument that applies to BP. Any oil exploration can cause massive environmental damage. But the United States -- through the Oil Pollution Act of 1990 -- has decided that the supply of domestic oil is important enough that the government has put itself on the hook for really massive disasters. This allows a steady supply of domestic oil and a promise that the kind of disasters that happen once a century will still be taken care of.
    But then that only works if (1) the oil companies don't rely on the federal government for run-of-the-mill spills, and (2) the federal government actually buys the kind of equipment needed to handle superdisasters, and the relevant government personnel train on it.

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  11. The government nominated itself as the solution if there ever should be a problem like this. They had given themselves authority to take over from BP and solve the problem. As a small government guy I would have been content to let all the blame rest on BP, except for the fact that the government has people who have been getting paid to plan for solving this exact kind of problem and they had none of the equipment their plans said they needed. Conservatives are not letting BP off the hook or suggesting they shouldn't solve the problem but pointing out how useless the government is at solving problems. I want everyone to realize that the government as your daddy happens to be a drunken abusive lazy lowlife daddy. To reiterate: conservatives don't want the government to solve the problem but want it noted that the government can't solve the problem (At great expense none the less).

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  12. Robert O'Callahan1 June 2010 06:06

    > If BP deserves blame for not adding the
    > redundancy, then the government must share some
    > of that blame for not requiring it.
    Not at all. Why should the government be responsible for BP's safety measures? Why should the government be considered more competent than BP at oil drilling?
    The idea that we need the government to tell BP exactly how to protect its oil wells strikes me as profoundly anti-conservative.
    > if a company had to have enough cash on hand at
    > all times to weather the next Great Depression,
    > then that company would be somewhat hampered
    > when the economy was in good shape.
    Then companies should just buy Depression insurance from someone, perhaps even the government. Then they wouldn't be getting handouts --- again, anti-conservative.

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  13. Robert O'Callahan1 June 2010 06:08

    No M, conservative pundits are not just noting the government can't solve the problem. They are demanding the federal government solve the problem. E.g.
    http://www.washingtonexaminer.com/opinion/Obama_s-dereliction-on-the-oil-spill-94934369.html
    (linked from http://corner.nationalreview.com/)

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  14. > Why should the government be considered more
    > competent than BP at oil drilling?
    Drilling and disaster recovery aren't the same skill. Certainly one would expect governments to be better at handling disasters.
    > ... companies should just buy Depression
    > insurance from someone, perhaps even the
    > government. Then they wouldn't be getting
    > handouts
    Insurance bought from private companies doesn't help. Their time horizon is only as long as the CEO expects to be in the job. If he calculates that the odds of a disaster happening before he retires are slim, it's rational for him to under-invest in disaster recovery infrastructure, make hefty profits, pocket his bonus, and leave the consequences to the next guy to deal with.
    No problem with governments doing this, but again, it makes sense for the INSURER (the govt) to handle the cleanup. They own the money for the infrastructure (provided by the insurance premiums), the liability for damages, and the public accountability.
    > --- again, anti-conservative.
    I think the whole point is that modern American conservatives, at least, are kind of nutty. It's fine to have a generally conservative outlook, but rational people look at each situation and make a judgement based on the particular circumstances.
    Modern socialists acknowledge that governments aren't good at a lot of things - say building web-browsers. Yet modern conservatives refuse to acknowledge that there's a legitimate role for government in things like disaster relief.

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  15. Robert, you seem to have gotten conservatives mixed up with Republicans! That article could have been written by someone named Bush, or Schwarzenegger or McCain but not a conservative :)

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  16. "Then companies should just buy Depression insurance from someone, perhaps even the government."
    Just a note that that's essentially what they did. The problem is that they all got that insurance from AIG, which forced the government into a $200 billion bailout of that company in order to keep all the others they insured from going under.

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  17. "Privatize profits ; socialize losses"

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  18. Robert O'Callahan1 June 2010 10:20

    M, you're heading for the "no true Scotsman" fallacy. The National Review surely qualifies as a conservative publication.

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  19. Libertarians in the US have a more "pure" conservative viewpoint than Republicans do, but they've never been very successful during elections because the public generally supports government involvement in some areas. They just disagree which ones.

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  20. Roc:
    "As far as I know, BP has been able to do whatever they want at the rig site."
    This is not true. The federal government owns the coastal waters and grants leases for companies like BP to explore and then, if something of value is found, extract it. All of this exploration and extraction is subject to many rules and regulations running the gamut from maintaining a safe work environment to protecting the environment. BP is not allowed legally to pick and choose what rules and regular follow and which ones not to.
    (As we have seen, all the rules and regulations cannot protect from either the unexpected or ill-informed decisions, but that is the subject of another debate.)
    To say the BP can do as they please is simply an uninformed and naive statement much as your initial post was.
    Asa:
    "Well said Mr. O'Callahan. Government isn't capable of doing half the things the promise people. They often just promise it to be elected and throw money and regulation at problems to try to make it look like they are fixing it so they can be re-elected (or help friends and/or interest groups). Meanwhile, the problem resolves itself. Although the BP incident won't resolve itself, the US government doesn't have the ability to do anything useful, yet politicians won't shut up about it."
    Just a Asa has said, many people naively think that government is automatically the solution. However, not only should we acknowledge that government is not some panacea, it most often is the real problem. Through it's misuse or misapplication of rules and regulations or through simple corruption, government too often not only does not "solve" the problem, it exacerbates it.
    When conservatives say, let the free market take care of things, they are implying that not only should people and companies be free to succeed, but also to be free to fail. When a person or a business thinks they will not suffer the consequences of their decisions, what incentive do they have to avoid making highly-risky ones?

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  21. Robert O'Callahan1 June 2010 13:04

    Ray, just give me an example of something BP wanted to do to fix their broken rig that the government hasn't let them do.

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  22. VanillaMozilla1 June 2010 16:31

    All this is part of the general pattern that we have heard for 30+ years. Criticize the government for everything and praise private industry. It's part of a propaganda campaign by people who believe their own propaganda.
    Let's see, BP used a blowout preventer that was in terrible shape. They filed an environmental impact statement that said not to worry. The industry got themselves indemnified against damages. Government oversight was pretty much neutralized by 30 years of attacks on government.
    I don't think anyone can make the case that too much regulation is a problem here. Try going to coal mining communities, where disasters a way of life, and tell them that government oversight is not needed. You can't convince me that oversight of drilling practices is a bad thing.
    By the way, I remember when the rivers caught fire, you couldn't see to the end of the block in Pasadena, the drinking water tasted funny, and eagles were rare. I'm grateful to good government for solving those problems. I also remember when banks were not permitted to gamble with our money.
    But that's not what we hear from the propaganda machine. Conservatives/libertarians tell us constantly that government can do essentially nothing right, and private enterprise can do essentially nothing wrong. Alan Greenspan told us markets are self-regulating, and blocked regulation. Then he was "astonished".
    Please, we've had enough of this anti-government crap. Don't even dare suggest that government can cap oil wells. And don't even dare suggest that government is responsible for cleaning up an impossibly large spill. Attacks on government are not the answer to anything.

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  23. You confuse vaguely-libertarian rhetoric by political operators, which has won the GOP its Nixon, Reagan, Bush and Bush Jr. terms, with anything remotely resembling commitment to that rhetoric. They have been pulling this move since Goldwater, and it works sometimes (though sometimes it fails: cf. Goldwater, Dole, McCain). Same way the Democrats trot out vaguely-socialist rhetoric with absolutely no plan to execute it (and both parties -- initially Democrats but then the GOP after Sunday School Teacher Carter beat Actor Reagan -- play this game with the evangelicals). Thus the willingness by either group to ignore said rhetoric when countervailing political opportunity arises. Nobody ever means it in the first place.
    (Note: this is not a "no true Scotsman" tirade by a frustrated libertarian, just a comment by someone saddened by the entire American political discourse; perhaps unlike most of the comment section you're likely to attract here, I would rather run naked through a thorn bush than politically support someone who actually holds libertarian political views. Unfortunately the fact that the GOP has produced a full generation of people raised in a bubble of delusional libertarian rhetoric means they are now faced with having a sub-movement inside the party -- their "Tea Party" -- that actually wants to put some of the rhetoric into practice. They made their bed, but I despair that the entire nation may someday have to sleep in it.)

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  24. >Yet modern conservatives refuse to acknowledge that there's a legitimate role for government in things like disaster relief.
    Who said that? Conservatives generally acknowledge that the government should try to help in emergencies where private entities can not, will not, or are overwhelmed. (Whether their efforts DO help is another question and one that should be asked and answered! We don't think the governments performance shouldn't be analyzed or criticized just because it was an emergency. Katrina anyone?) I think you will find that conservatives do have a problem with the governments definition of disaster relief as "total reversal of all effects of a disaster spend-fest" though. In other words we will help get you back on your feet but if you didn't buy insurance for your house in a flood plain, you're gonna need to buy yourself a new house.

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  25. Michael Burns1 June 2010 20:44

    One thing that I personally believe is that the government shouldn't be tasked with fixing the situation. It should be private enterprise, in this case BP. It was their rig, it happened on their watch, they may even be partly responsible, so they should be made to fix it. They are legally liable. If they can't, they should be forced by the government to pay another private firm to fix it.

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  26. Robert O'Callahan1 June 2010 22:32

    graydon, my impression is that a lot of conservative activists do "mean it", but in the heat of battle identity politics takes over and they support "their team" because they're "better than" the alternative. In more reflective moments they understand the problem (see M's comments above).
    Personally I don't think even the "Tea Party" is consistently conservative. Anyone with a true interest in limited government would rail against farm subsidies, pork projects, and wasteful defence spending with the same vigour they rail against redistributive handouts to the poor. The Tea Party mostly doesn't (with a few notable exceptions).
    I happen to think that application of that kind of consistency would work well in practice, but the inconsistent and selfish application favoured by nearly everyone on the right of the US political spectrum is probably worse than the status quo.

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  27. >[Me]: If BP deserves blame for not adding the redundancy, then the government must share some of that blame for not requiring it.
    >[Response]: Not at all. Why should the government be responsible for BP's safety measures? Why should the government be considered more competent than BP at oil drilling?
    There's a difference between how the world ought to work and how we should fix problems that exist in the world today. If the legal standard were simply strict liability, BP and other oil companies would spend a lot more time making sure no drop of oil ever made it to the ocean. But when the government or an insurance company, or some other organization simply mandates certain safety measures, then only those measures are implemented. Sure, in the perfect world people would go above and beyond the minimum legal requirements, but experience shows that companies generally believe that doing so will make them uncompetitive.
    So, in the world that exists today -- with the Oil Pollution Act of 1990, limited liability for disasters of this sort, and a complex regulatory regime -- BP's failure to consider what would happen if the blowout preventer failed is a black mark on BP. But the federal government's failure to consider what would happen if a mandated blowout preventer failed is a black mark on the bureaucrats who wrote the regulation.
    >The idea that we need the government to tell BP exactly how to protect its oil wells strikes me as profoundly anti-conservative.
    I'm not sure how you're defining conservative. It seems to be something of a cross between "libertarian" and "pro-business." I think Russell Kirk's 10 principles of conservatism make a better guidepost ( http://www.kirkcenter.org/kirk/ten-principles.html ). I would prefer a different regulatory regime, but given that we live in a world with this regulatory regime then I don't see why we shouldn't expect more from our regulators ( http://daviddfriedman.blogspot.com/2008/09/regulation-too-much-or-too-little.html : "[O]nce the government does intervene, less regulation is not necessarily better than more. ... If, as in the current case ... government intervention makes the government ultimately liable for losses by the regulated firms, less regulation may mean more opportunities for firms to gamble on the basis of 'heads we win, tails you lose,' with 'you' being the taxpayers. Once the government is liable for losses, it may be prudent for the government to make rules designed to limit risk").
    On a related issue, should the NIST mandate seatbelts in cars without mandating (1) the strength of those seatbelts, or (2) the use of airbags?

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  28. roc, read the license agreement the feds granted/sold to BP. BP can only do what the federal government allows them to do.
    May I remind you that Louisiana has sought permission to engage in, I believe, efforts to protect their coast from the oil spill yet are not getting the approvals needed from the federal government: http://www.nola.com/news/gulf-oil-spill/index.ssf/2010/05/jindal_others_bash_bp_and_fede.html
    This is in addition to Gov. Jindal's calls for both the federal government and BP to live up to their pledges to protect against environmental disaster: http://www.washingtonpost.com/wp-dyn/content/article/2010/04/30/AR2010043001044.html
    Why isn't a poignant observation being made with regard to the very lack of leadership being demonstrated by President Obama? Hasn't he appeared to have spent more time blaming others rather than pulling together all the resources possible to both plug the well and clean up the spill?

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  29. Interesting. Right here that's the reaction socialist and left-wing politicians take and conservatives not always share that.

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  30. The Heritage Foundation in its Morning Bell blog post of 3-Jun-2010 provides the most comprehensive summary of the Gulf oil spill I have read to date. Link: http://blog.heritage.org/2010/06/03/morning-bell-obama-and-the-oil-spill/
    roc, you will see it clearly spelled out why conservatives are turning to the federal government--because while it is BP that is liable, this falls squarely under the jurisdiction of the federal government and its myriad of rules and regulations. You will see that it is the federal government that is delaying or restricting the taking of action. You will see that instead of leading, President Obama seems more intent on pointing fingers, laying blame on others and, in the words of White House Chief of Staff Rahm Emanuel, taking “a crisis is a terrible thing to waste” attitude to add more rules and regulations that rather than averting futures crises, will raise the cost of all energy for all of us including we "average middle class types" the president and his political party claim to stand and speak for.

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  31. It is likely because of previous initiatives by conservative governments to remove or undermine regulation that BP became lax in their safety controls. The answer here is effective government not less government.

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  32. Chrs: if the regulations had been effective, I have no doubt people would have used that as evidence that we needed even more regulations. But since the regulations were ineffective, you're using it as proof that we need more. Is there anything that would convince you we need fewer regulations? Or that the regulations we have are barking up the wrong tree?

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  33. @Max: Likewise, is there anything that would convince you we need more regulation? People are now claiming that fewer regulations would have made BP more careful, while before they were saying that the lack of any recent disasters meant there was too much red tape for companies to mess with.
    Both sides are so entrenched in their philosophies that neither side is ever going to be convinced by a rational argument.

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  34. First and foremost, everyone needs to acknowledge that the oil well blowout is a tragic accident and that it is highly unlikely that any amount of regulation would have prevented it from happening. Being made to drill for oil that far out and nearly a mile down is on the very edge of current human endeavors like this.
    Also, most rules and regulations are often too little and too late not to mention running the risk of becoming a hindrance rather than an improvement. As should always be the case, groups of experts representing both the public interest as well as the energy/oil exploration industry are needed to write effective rules and regulations that balance the need to protect the environment and worker safety while allowing enabling the extraction of what remains one of the world's most efficient sources of energy and products.

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  35. Michael Burns5 June 2010 23:45

    The issue isn't one of regulation. Regulation isn't the reason this crisis happened. Government intervention into the free market is the cause of the crisis.
    A person or firm is liable for damages they cause. Let's say that you own a meat processing plant. Let's say that some of you meat gets contaminated and people get sick. You are are liable. You can be sued for damages and what not. Firms usually go out of their way to be good and avoid these lawsuits.
    In the case of BP, the government intervened and passed a law that put a cap on BP's liability. Because of that, they only have to pay up to a certain amount in damages if a situation like the current crisis occurs. This actually gave BP a perverse incentive to have "relatively" lax standards for protecting against disasters.

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  36. I agree with thw first guy on this blog..it's private enterprise...the conservative private sector at it's best that made this mess..let them clean it up...you want less goverment ? let's start with this and see what you can do

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