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Sunday, May 16, 2010

Republic has succumbed to corporate rule

News on the Gulf oil spill comes and goes. BP, the company which operated the rig, claims about 5,000 barrels a day are leaking. BP, alongside Transocean, is part of the Deepwater Horizon Incident Response Team. Being that the oil company's negligence contributed to the disaster, allowing them to play a leading role in the response may be making the disaster worse.
The company clearly has a financial incentive to understate the scale of the disaster. That way when the lawsuits come rolling in, they can say it wasn't (or isn't considering how long the oil will be around) as bad as the plaintiff's attorneys claim.

I just saw on CNN that Gulf fisherman were lining up to receive checks for working on spill containment efforts. Rather than compensate Gulf fisherman for their catastrophic financial losses, the powers that be are content to throw a few scraps out to the displaced, hiring a few of them (the CNN report said 10% of those lining up) to work the oil containment--the only work available to them.

I've lived near the Gulf of Mexico and can tell you that these fisherman are people you don't want to screw with. It's not that they're psychotic or anything, it's just that they're the kind of people who won't forgive or forget. And unlike the poor, huddled masses deported out of New Orleans in the Katrina tragedy, some of the fisherman have deep pockets. Nonetheless, it's unlikely many of them will be able to continue in their chosen profession with the waters polluted for decades.

While BP has said it would honor all legitimate claims, the cap on its liability may be a paltry $75 million. While Sen Menendez of New Jersey has called for an upping of this statutory limit on damages, President Obama has been less forceful about upping compensation for the affected, blaming instead the finger-pointing between BP, Transocean, and Halliburton.
As outraged as the President may appear, relief appears far from coming. Instead, it appears the damages will be limited by courts far away, and representatives of a two-party duopoly beholden to Big Oil. As the campaign donations from Big Oil swell, so too does the amount of influence they can wield in the White House and Capitol Hill. Considering the true scope of the leak--a fact the BP will never readily acknowledge--damages are already in the hundreds of millions. But true to their sponsors are our Congresscritters and the recipients of campaign donations who purport to represent us.

The Deepwater incident was completely preventable. The "blowout preventer" was faulty and inadequately inspected. The federal agency responsible for oversight of Gulf wells, the Mining and Mineral Service (MMS) has a thick record of open fraternization with the companies they're supposed to oversee. We saw a similar situation with the SEC and Bernie Madoff, who's daughter married an auditor from the government agency. And undoubtedly the Federal Reserve and Treasury engage in a give'n'take behind closed doors that benefits the banksters while defrauding the public and placing our nation in perpetual debt servitude.

The point of the Deepwater disaster is this: our federal government has become ruled by corporate interests. The needs of we the people aren't as important as those who contract for government services and offer kickbacks in the form of campaign donations. We the people can vote, so the politicians offer us lip service, but the tools of manipulation are obvious to see when preventable, man-made disasters like Deepwater occur.

And what can we do about it? We're offered a choice of twiddlee-dee and twiddlee-dum, corporate candidates both. Party One is Party Two, at least once they get into office and the campaign rhetoric stops. Look at Obama. We have a man who got into office by lying. he claimed we'd have a drawdown in Iraq--instead our boys languish there. And for what? The political climate there has degenerated along sectarian lines, Shia versus Sunni. Civil war remains a possibility. I've heard it said that we've broken Iraq beyond repair.

What good is our government if it can't win in the wars it launches? The AP headline came out nationally last week acknowledging what anyone with a brain knows: the War on Drugs has been a utter failure. But does that change our policy? No, the federal government blindly forges ahead with its losing strategies not because it seeks to win the wars it fights, but because key corporate constituencies benefit from these ongoing wars. With the War on Drugs, it's the prisons, Homeland Security, and a myriad of law enforcement bodies. With the War on Terror, it's the bloated Military Industrial Complex, the one Eisenhower warned us about.

It's probably the war machine that'll finish off American empire. There's no way we can endlessly spend on war of no productive value to our society. I mean, yeah sure, they're are jobs here and there that can be sustained by military spending, but the overall benefit to the economy shrinks over time. The corporations that benefit the most financially from the war spending grow increasingly inefficient as competitive bidding shrinks. War contracts tend to get costlier and costlier, and funneled to companies which become wholly dependent on the government's easy money. Eventually, all competition is bled out of the system and left behind are the companies with the most political influence entrenched at the trough, hardly much of a real economy at all.

Already the government trough is crowded, with the big players consuming ever larger chunks of government spending, leaving less for other needs like enforcement of drilling regulations in the Gulf. The same thing happened with Katrina: the Army Corps of Engineers, charged with maintaining New Orleans' levees shifted funding overseas to meet needs in Iraq. Result: insufficient levee maintenance. And for those who understand the levees, they understand that they're constantly sinking and if they're not constantly increased, the outcome could be tragic.

As America gets peppered time and time again by man-made, preventable tragedies, who's to stop it? Certainly not our two-party system, with its rule-by-corporate-sponsorship. So bad has the situation become that there's no way any candidate can make it to the top of a national ticket without being thoroughly vetted by powerful corporations. Obama was "star-chambered" at some point in his rise to the top. We don't know exactly when he was co-opted, but his constant obedience to corporate rule has shown through most of his time in office. Could he be salvaged? Unlikely, being that the key groups who back him must have some leverage or means to control the President, with money being the most likely culprit.

We saw preferential treatment for Goldman Sachs; they'd given him close to a million dollars. BP I believe was Obama's biggest single corporate donor, at least within the oil industry. Why? I mean why would these companies give so much? Well, they obviously felt they would get something in return. For Goldman Sachs, it's been record bonuses and profits while squeezing the Federal Reserve and Treasury for an bailout of AIG, who owed them over $10 billion. The benefits for BP aren't so clear yet, but as more and more oil washes up on Gulf beaches and the scope of the tragedy comes clear--alongside the lax enforcement that allowed it to happen, we'll likely see Obama or his agents find a way to limit BP's losses.

Serving those corporations comes at a great risk to the President. He faces a Katrina moment in his administration's handling of the Deepwater spill. And if the estimates of the true size of the leak become true, oil could be coming up for years, a easily documented political liability for incumbents which could utterly destroy Obama's chances of winning Florida. If the GOP were to put on its 2012 ticket a candidate with a decent environmental track record, it could easily win over enviromentalists, who might otherwise vote for Obama out of fear of what GOP leadership (read deregulation) could do.

Again, we the American people are left with a choice of lesser evils that seems to be eating away at the core of our representative democracy. The two-party system, rather than giving voters a means of holding politicians accountable is simply a revolving door through which corporate interest groups thrust substantially similar candidates at periodic intervals.

Subverting candidate choice here

I read that Congressman Hostettler has been appointed to run for "retiring" Senator Bayh's seat. Hostettler is strongly pro-life and pro-all new terrain I-69. The new I-69 would benefit construction companies who were top donors to the Hostettler's campaign. It would cost $2 billion in order to save 10 minutes of driving time from Terre Haute to Evansville.

Here in Indiana, Democrats were cheated out of a primary process by the timing of Evan Bayh's decision not to run. I found a good article on this in bloomingtonalternative.com. Steven Higgs writes:
One of two things happened here. Either Bayh did just reach a decision, in which case he's an impulsive quitter. Or, he knew all along and deliberately chose to circumvent state Democratic Primary voters.
The National Republican Senatorial Committee (NRSC) believes it was the latter. "It raises serious questions whether he purposefully timed his announcement to deny Hoosiers a voice in the political process," NRSC spokesman Brian Walsh said in a Feb. 17 news release.

Opednews editor Rob Kall has some similar thoughts on the matter in his poll here, where I commented twice. Kall's article on this perversion of the demoncratic process is here. Kall explains, "I don't think this was an accident. It was planned-- a conspiracy to take the Democratic process away from Indiana Democrats."

This whole subversion of democracy thing means that the Republic has been lost, I'm afraid. The choice of candidates has been stripped from Indiana voters and assigned to out-of-state political strategists. It's worth remembering that many of these Beltway consultants-for-hire were blamed for mismanaging many Democratic campaigns in 2004.

Enviromy Note

As you might suspect from reading this blog, I'm completely bearish on the US stock market. While I don't give investment advice, I have told you that I've invested exclusively in silver. Well, recently I've grown a little more bullish on alternative energy. Rather than just short our domestic market, I've put some of my very limited resources into a solar power concern.
Look at the tragedy in the Gulf, I think alternative energies are the ethical choice. As I've noted in the past over at my enviro-blog, coal and nuclear are very dirty and destructive, from the extractive phase all the way to disposal.

Duke Power is trying to build a massive coal plant not too far from Terre Haute, in Edwardsport, one which isn't needed to meet demand in the area. It will spew something like 2 million tons of CO2 into the atmosphere annually. Mercury will run in our streams. This doesn't include all the slurry dams that will break, mountaintops that will be removed, and miners who will die as a result of inadequate safety.

I guess the lesson here is that they'll get away with everything we let them get away with. I'll close with this Fredrick Douglass quote:
"Find out what any people will quietly submit to and you have found out the exact measure of injustice and wrong that will be imposed on them."

Ho binh.

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Sunday, May 02, 2010

Deepwater disaster could have been prevented

As I write a river of oil blows towards the Gulf coast. Details of the precipitating event have emerged. Blame is squarely on BP, British Petroleum.

Victims of the tragedy include fisherman--recreational and commercial. I'm sure the economic impact of the Deepwater Horizon oil rig-turned gusher will be far worse than predicted.

The worst part of this tragedy is that the well continues to leak. Huge amounts of oil remain unseen, under the surface. Considering the well's depth, at some 5,000 feet, an emergency operation remains challenging and an easy fix elusive. The wellhead is on the ocean's floor and spewing out an indeterminate amount of oil.

Part of the crisis response effort has been to bring as many parties as possible on board. BP's chief of operations said any help from anyone would be accepted. This methodology leaves me wondering if the response has been as dynamic and robust as needed--shouldn't BP be more specific than accepting all help? I mean, I would hope BP has a planned response more detailed than just throwing more resources at it, like the miles of boon that have been laid in a feeble attempt to stem the tide.

Looking back at Katrina, the Deepwater disaster sends echoes of government inaction. All the parties involved in the response undoubtedly don't want to appear to be doing nothing. So official news briefings and perception management try to appear responsive and robust, whether or not they actually are. The result is that the parties responsible for the response try to offer counter-directional spin in the mainstream media--that they're doing something, which is evidence of an agenda other than to tell the public the unbiased, whole truth, no matter how ugly.

Oddly, many news networks devoted constant air time to a serious but failed car bomb attack at Time Square. Conspiracists will no doubt be quickly guessing that the one had something to do with the other. In this sense the Internet hosts in hyper-time huge numbers of doubters of the Official Explanation: a growing crowd of wired non-conformists eager to confront media myths, spin, and blackouts.

Coordination between the Coast Guard, Department of Homeland Security, and Department of the Interior involves massive layers of government bureaucracy. All three organs have their own heads, and while interagency communication protocols may make coordination easier, there are simply too many decision-makers to react quickly enough to a tragedy of this size.

We don't know if a single head of the operation would be better or not. Right now a Coast Guard admiral is at the head of a multi-pronged response that also includes BP and Transocean, the rig operator.

Issues of whether or not the response is adequate or expeditious can certainly wait. In the meantime we have a New Orleans Katrina-type environment evolving. The poor, mostly black people stuck in the Superdome and New Orleans Convention Center have been caught on television, demanding rescue. Expect this time instead of people, there are birds who stand to be coated in oil--an event which will certainly remind Americans of the Exxon Valdez tragedy in 1989.

In that episode, thousands of Alaskan salmon fisherman were made unemployed for years. The case reached the Supreme Court only a few years ago. Over the years, the Court had turned largely sympathetic to the interests of Big Oil and ruled against any punitive damages. The legal case did foretell a sequence of what might be called "pro-business" rulings, the latest of which has been to give corporations legal standing as corporations--a completely ridiculous notion that I attack on the second page of my last article at OpEdNews.com.

However unsatisfying the final ruling on the Exxon Valdez judgement, the Courts also took too long to resolve the case. The delay came as a direct result of Exxon's massive legal effort to delay a settlement, based on the premise that the interest on the settlement was more valuable to the company than a final adjudication. So the case went on, with no side but rather the lawyers winning.

I pity the poor fisherman and their families in the Gulf who rely on clean waters for their livelihood. The tragedy will expand geometrically if the oil flow isn't curtailed, which appears to be a difficult and time-consuming task. Estimates for the size of the oil deposit vary. If something isn't done to stop the flow, we could be facing one of the worst environmental tragedies to hit our country.

The emerging economic impact will be two-fold. First, there will be the loss of jobs in fisheries, and other professions dependent on the seas. And the loss of income will reverberate through the communities that live the Gulf. We might see a wave of environmental refugees forced northward, unemployed and miserable, bearing little money and down on their luck. This would be like the days after Katrina, where an exodus out of the city left natives of New Orleans marooned far from their city.

Then there will be a drop in tourism due to the fouled beaches. The tourist impact will be the largest fiscal cost. I heard on CNN that Walton County, Florida is projecting to experience as much as a $1 billion loss in economic activity. If one county faces that kind of loss, the entire region--which compromises some of the nicest beaches in America, could face economic devastation.

The impact of this tragedy will last for years. For as long as oil plagues the water, the ecosystem will suffer and the business that depend on it, too. Despite modern technology, and frequent urging to "drill, baby, drill", the economic benefits of domestic drilling will be overshadowed by the consequences of potential spills.

If domestic drilling were a solution to our energy dependency--a notion with which I disagree--then the Deepwater incident should be cause for real alarm. Incidentally, it's not the blow to oil production that a moratorium on drilling presents, but rather the potential impact of spills on affected businesses and consumers. Calculated into the drill-at-all cost "solution" must be the direct costs of pollution and spills, which will easily eclipse the value of the oil itself.

For BP, the cleanup appears to be at this point simply be the "cost of doing business." This sounds a lot like Massey's energy recent mine explosion, which came as the result of numerous safety violations.

If BP, like Massey, was simply ignoring the infractions to save money on correcting the underlying problems, then this tragedy could have been prevented. If regulations were not enforced, then our government bears much responsibility.

No matter what the eventual court settlement, or how long it takes, BP will likely avoid many of the damages due to sympathetic judges on the Supreme Court. As long as rulings like that which granted corporate personage continue to emanate forth from On High, it's unlikely that polluters will face the full fiscal ramifications of their regulatory non-compliance.

You can see a clear pattern developing where the government fails to enforce regulations, which may in the short term benefit corporate constituents. The Massey and BP incidents show--alongside the far-bigger financial bailout--just how close government and the corporate interest have conjoined. Ironically, the Deepwater incident will reveal the real economic cost of not complying with safety standards and regulatory compliance.

Without a viable third estate--an unbiased and unafraid media--it's unlikely corporations will be held accountable. Worse, the lack of investigative journalism--for fear of alienating advertisers--will cultivate an attitude of defiance among the regulated. The lack of negative consequences will encourage potential polluters and companies intent on exploiting their influence and the lack of regulatory enforcement. Maybe the hot to BP's stock price will be sufficient incentive to avoid safety errors of this magnitude. Or perhaps not, particularly if BP has the benefit of sympathetic courts.

In its Texas refinery fire a few months back, BP showed itself to be the kind of company that shirks its regulatory responsibilities. In the Deepwater incident, it's joined by Transocean, a company about which I know little, and the infamous Halliburton, a company formerly led by Dick Cheney, who held approximately two million shares of company stock while serving as Vice President. Halliburton, by the way, had its stock price climb over 200% as a result of the decision to invade and occupy Iraq. It's been accused of shoddy construction, illicit deals, and a myriad of other ethical violations in Iraq.

So should we be surprised that a corruption of the public interest precedes a environmental catastrophe? Of course not. As much as the Republicans bang away against regulation, a major cause for the worst economic events of the recent past can be directly traced to inadequate enforcement by federal agencies.

The Minerals Mining Services is a branch of the Department of the Interior that was caught accepting hookers and drugs in exchange for favorable treatment of businesses signing leases with the federal government. M.M.S. has offered bargain-basement leasing terms in sweetheart deals to extractive industries. So bad were some of these contracts that they were actually renegotiated after the scandal broke. See this article at propublica.org for more.

All this collusion between big business and the federal government really does show how badly corrupt both have become. The businesses spend to wine and dine in Washington through trade associations and industry groups. Meanwhile, politicians eagerly dispense reciprocal favors, resulting in a perversion of the enforcement scheme, not too unlike the Madoff case. Madoff's daughter actually married a SEC auditor!

One common hallmark of manmade disasters is that the corruption and regulatory breakdown lead to even bigger disasters. Without enforcing the rules on the books--a task which can only fall to government--scandals and disasters will be both worse and more frequent, as were seeing in our society today.


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