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Health Care & Environment
11.15 The long read: The plastic backlash: what's behind our sudden rage – and will it make a difference? [the world wants to throw-up...]
11.15 Claws out: crab fishermen sue 30 oil firms over climate change [workers are waking-up...]
11.15 Trump administration to cut air pollution from heavy-duty trucks [behaving ignorantly again...]
11.12 This Land is Your Land: The Zinke effect: how the US interior department became a tool of industry [behaving ignorantly again...]
11.11 Trump responds to worst fires in California’s history by threatening to withhold federal aid [behaving ignorantly again...]
11.11 Interior department sued for ‘secretive process’ in at-risk species assessment [behaving ignorantly again...]
11.11 Keystone XL pipeline: judge rules government 'jumped the gun' and orders halt [behaving ignorantly again...]
News Media Matters
US Politics, Policy & 'Culture'
11.15 Democrats Won Big. Can They Go Bold, Too? [it's about suppressing the influence and leadership by Republican-like Democrats who counsel 'íncremental' (no) change, such as Nancy Pelosi, Steny Hoyer, Hillary Clinton, Chuck Shumer and Joe Biden]
11.15 Pentagon Officials Forced to Make Fewer Public Appearances to Avoid Provoking Trump [...by revealing Trump's huuuge ignorance]
11.15 REPUBLICANS USED A BILL ABOUT WOLVES TO AVOID A VOTE ON YEMEN WAR [if there are 'defense industry' profits to be made—including congress-critter insider-trading—and political 'donations' to be had, we mustn't stop killing innocent civilians!]
11.09 Trump administration blocks asylum claims by those crossing border illegally [Making America Less Great Again...]
11.14 The Guardian view on Yemen’s misery: the west is complicit [WAR CRIMES]
11.10 US stops refuelling of Saudi-led coalition aircraft in Yemen war [But there are a few children still alive. It's too soon!]
Economics, Crony Capitalism
11.15 The Earth is in a death spiral. It will take radical action to save us [fossil fuel burning, un-recyclable plastic production/use and methane gas release must cease ASAP.]
International & Futurism
11.15 Cuba to pull doctors out of Brazil after President-elect Bolsonaro comments [terms must be negotiated for fairness to Cuba's health professionals without disruption of healthcare for Brazil's poor]
11.14 'Appalling' Khashoggi audio shocked Saudi intelligence – Erdogan [Exposing a psychopath?]
FACTS WITH COMMENTARY:
The U.S. Government, Brought to You By Big Oil
First published in his blog Unsilent Generation two days ago, on 4 June 2010
Government attempts to contain or regulate the industry have never been major obstacles to Big Oil’s power or profits. This is hardly surprising, considering the kind of influence the oil companies wield at all levels of the U.S. government.
Oil companies have begun to “weigh strategies to fight off tougher regulations” in the wake of BP’s spill to end all spills, the New York Times reported earlier this week. Supposedly, the companies are nervous because of President Obama’s angry takedown of the oil industry last week, as well as rumblings in Congress, where there are now efforts “to extend bans on new offshore drilling, strengthen safety and environmental safeguards and raise to $10 billion or more the cap on civil liability for an oil producer in a spill.”
Frankly, I don’t buy it. I’m quite willing to believe, as the Times story says, that the petroleum industry’s lobbyists have kicked into high gear. But I can’t believe the companies are really all that worried. Ever since John D. Rockefeller founded Standard Oil in 1870, the federal government has pretty much given the oil men exactly what they wanted, when and where they wanted it–from oil depletion allowances to tariff protection to cheap leases on the federal public domain (which includes the outer-continental shelf in the Gulf of Mexico, site of the Deepwater Horizon disaster). Periodic government attempts to contain or regulate the industry have been little more than temporary annoyances, rather than major obstacles to Big Oil’s power or profits. This is hardly surprising, considering the kind of influence the oil companies wield at all levels of the U.S. government.
Long may she wave: The flag of the United States of Oil
In 1911, for example, the U. S. Supreme Court found that Standard Oil, which was then controlling 85 percent of the industry, had violated anti-trust laws and conspired against the public good. “For the safety of the Republic,” the Court declared, “we now decree that this dangerous conspiracy must be ended” within six months. Standard Oil was broken up into a few dozen closely related smaller companies–the only result being that the nation’s energy lifeline was controlled by a cartel instead of a monopoly.
Another serious stab at regulation began in 1938 with the passage of the Natural Gas Act, which again tried to combat monopolistic pricing by giving the Federal Power Commission (predecessor to Federal Energy Regulatory Commission) the authority to set “just and reasonable rates” for the transmission or sale of natural gas in interstate commerce. In 1954, in the Phillips decision, the Supreme Court held that the federal government should also regulate the price of natural gas at the wellhead–that is, at the point where the gas comes out of the ground. For the better part of a decade, the government fiddled around doing nothing, but then in the early Kennedy administration, the FPC came up with an area pricing plan. Although the focus here was on gas, everyone knew it was a warning shot at the oil industry, which owned and controlled most of the natural gas. To price gas, it would be necessary to get at the oil industry internal documents, revealing such things as the amounts of reserves, costs, and the like.
Immediately, the big oil and gas companies warned we would run out of gas if prices were not raised to stimulate greater production. In 1974, during the (largely manufactured) energy ”crisis,” the FPC took the first steps to undercut its own proposed regulations by giving in to industry and hiking prices. Under Jimmy Carter, the government began the formal process of deregulating gas, a policy which carried forward under Reagan and both Bush’s as part of the Republican right wing’s drive against regulation. Once the government gave in, the gas shortage disappeared and today we are supposedly awash with gas. All this was accomplished by industry manipulation of production and reserve figures—the same thing that has happened during all oil “shortages.”
In the wake of the BP disaster, it’s become abundantly clear that the oil industry itself has been writing the rules for offshore drilling, and not federal regulators at the Interior Department’s Minerals Management Service. “Nearly 100 industry standards set by the American Petroleum Industry are included in the nation’s offshore operating regulations,” McClatchy reported last month. “The API asserts that its standards are better for the industry’s bottom line and make it easier to operate offshore than if the Minerals Management Service set the rules.”
The Washington Post reported on Thursday that the MMS approved “categorical exclusions’’ from environmental review for BP’s offshore wells in the Gulf, including the Deepwater Horizon. Congressional probes already suggest Minerals Management worked in collusion with BP and other oil firms to increase offshore production without regard to safety or environmental standards. Over the last month, the litany of MMS’s failures, and its more than “cozy” relationship with the oil industry, has been extensively documented by the press (including MJ’s Kate Sheppard, here and here). With government oversight of this caliber, we ought to stop wondering how a disaster like the Deepwater Horizon spill could happen, and start wondering where it’s going to happen next.
Failure to devise any sort of meaningful regulation of the oil and gas business means that we really don’t know what the industry does, or where or how. Information on the country’s reserves are left in the hands of the companies, not the federal government. Since the US Geological Survey, which is supposed to map the public domain never had the money to do the job right, large parts of the public lands have not been thoroughly mapped by anyone but the companies that exploit it. Relying on industry data has resulted time after time in false information–as in the case of gas in the 1970s energy crisis–to inflate or deflate the amounts of oil and gas reserves.
Beyond failing at its own oversight function, the workings of the MMS also make it difficult for independent analysts to assess what is really going on. Earlier this week, a coalition of scientific societies underlined the problems in a letter to Interior Secretary Ken Salazar:
Such changes are unlikely to be implemented even in the wake of the BP spill. The secrecy surrounding federal energy policy was underscored by the confidential meetings organized by Dick Cheney with the oil and gas industry, as part of the Vice President’s ”task force” to design a new national energy policy in the early years of the Bush Administration. Those meetings, the details of which remain hidden from the public—their confidentiality supported by the courts—are the most glaring recent example of energy policy formed in secret, and in collusion with the energy industry. In other words, in America, the oil companies not only write their own regulations and perform their own oversight; they also set energy policy and draft laws.
In addition to having their way with the executive and legislative branches of government, the oil companies have largely triumphed over the judicial system as well. Government policy plays into oil company interests not only by letting them do as they please, but also in limiting their liability when things inevitably go wrong. On “Meet the Press” last Sunday, White House energy advisor (and former Clinton EPA head) Carol Browner repeated the pledge that BP would pay all cleanup costs for the spill. This is true, as far as it goes, and BP too has promised to pay for the cleanup. But you can just see lawyers haggling in court over what constitutes a cleanup cost.
In addition to the outright cleanup costs, BP also faces cost of up to a total of $75 million for damages not associated with the oil spill itself—such things as fishing and tourism. That amount would be woefully insufficient in this case. Finally, some of the $1.6 billion stashed in Oil Spill Liability Trust Fund could be spent in a cleanup. This fund is made up of industry taxes of 8 cents per barrel, and there is a cap of $1 billion on how much of that can be withdrawn. The House recently undertook efforts to raise the cap and increase the industry taxes going into the Oil Spill Liability Trust Fund. But since this Trust Fund is created by taxing oil, you can be sure that one way or another, the cost will be passed on to consumers, rather than coming out of oil company profits.
Finally, the Supreme Court could decide to give a special parting gift to BP, as they did to Exxon following the Valdez spill. In that case, an Anchorage jury brought in a verdict of $5 billion in punitive damages against Exxon. In 2008, after nearly two decades of litigation, the Supreme Court reduced the damages to $500 million–a tenth of the original verdict. The decision, written by Justice Souter, cited ”the need to protect against the possibility...of awards that are unpredictable and unnecessary, either for deterrence or for measured retribution.” It’s hard to believe five Supreme Court Justices believed that $5 billion wouldn’t be a more effective “deterrent” to future negligence than $500 million. But apparently, the highest court in the land wanted to make sure that a jury of citizens didn’t go overboard in demanding responsible behavior from America’s favorite industry.
Born in 1936, James Ridgeway has been reporting on politics for more than 45 years. He is currently Senior Washington Correspondent for Mother Jones, and recently wrote a blog on the 2008 presidential election for the Guardian online. He previously served as Washington Correspondent for the Village Voice; wrote for Ramparts and The New Republic; and founded and edited two independent newsletters, Hard Times and The Elements.
Ridgeway is the author of 16 books, including The Five Unanswered Questions About 9/11, It’s All for Sale: The Control of Global Resources, and Blood in the Face: The Ku Klux Klan, Aryan Nations, Nazi Skinheads, and the Rise of a New White Culture. He co-directed a companion film to Blood in the Face and a second documentary film, Feed, and has co-produced web videos for GuardianFilms.
This article is republished in the Baltimore Chronicle with permission of the author.
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Baltimore News Network, Inc., sponsor of this web site, is a nonprofit organization and does not make political endorsements. The opinions expressed in stories posted on this web site are the authors' own.This story was published on June 6, 2010.