Oil and Gold

There has not been such a dramatic demonstration in a long time of the consequences of the global obsession with the “black gold” as the recent oil spill disaster in the Gulf of Mexico. When just last month a methane explosion destroyed the “Deepwater Horizon” offshore oil rig, eleven oil workers were killed and 5.000 barrels of oil have leaked out every day since. The Deepwater Horizon incident is shaping up to be the largest oil spill disaster of all time in terms of environmental impact and cleanup costs, surpassing even the dramatic Exxon Valdez oil tanker disaster in 1989. In that case, at least 250.000 barrels of crude oil were spilled over the course of time, causing environmental damage to seabirds, otters, ducks, salmon, herring and so forth that even now the region has not fully recovered from. The northern rim of the Gulf of Mexico also has many wildlife and bird reserves, particularly in southern Louisiana, which may be similarly affected this time. The consequences for the ecosystem are difficult to assess but are likely to be extremely negative for at least several decades. The coming hurricane season, which threatens to blow the oil spill (already the size of Delaware) further inland, may worsen this effect. The world’s already highly threatened edible fish stocks are under serious danger of significant further depletion, given how the northern Gulf of Mexico is a major source of seafood, well known as part of Louisiana cuisine.

The indirect cause of the disaster is generally considered to be lack of proper regulation. The collusion between the oil industry and the environmental and workplace regulators is widely known, and the oil lobby has been particularly effective in preventing any meaningful tightening of environmental and workplace standards, despite the impact of repeated oil spills worldwide and the fact that the oil industry is still one of the most dangerous branches of industry for workers. ‘Benign neglect’ under the guise of self-regulation has dominated the regulatory approach, just as it did with the world’s financial capital, and with similar consequences. Not just direct bribery of the inspectors and regulators is known to be common (although for legal reasons, it is best not to mention details), but also the general ability of the oil industry to funnel large sums of money to the campaign funds of capitalist politicians, who in turn bribe constituency voters with them. This mockery of ‘democracy’ is what allows capital’s depredations to continue unopposed at the expense of the ecosystem, the safety of workers and our common future.

Of course, accidents can and do happen, and they always will. Of itself, this proves nothing against capital as such. A more interesting question however is to look at the costs of the cleanup. In the Exxon Valdez case, the parent company ExxonMobil (one of the world’s largest altogether) did end up paying a significant sum of about half a billion dollars in compensation; but it took until just a few years ago for the litigation to be finalized and the sums to be actually paid, some twenty years after the event. Moreover, American law limits the liability for oil spills other than direct cleanup costs (on-site) to a mere $75 million, which is absurdly little given the enormous environmental impact and the possible long-term economic damage that may result. The Obama administration is attempting to raise this figure to $10 billion, but it is by no means clear whether this can be lawfully applied retroactively.(1) British Petroleum (BP) besides may well become yet another case of ‘too big to fail’: if as owner of the oil rig, despite having leased it to a smaller company, they are to pay the entirety of all cleanup costs, this may represent more than even a company of that size is capable of paying. The question of who will end up paying for it instead is then easily answered: the public. If as some of the most conspiratorial and dramatic estimates indicate the cleanup costs may well be over time as high as $1 trillion, even just half that amount would present the people with a massive bill.(2)

And this is where capital does come in. Nothing can entirely rule out accidents and human error, although better and more serious regulation with an eye to the ecosystem and the well-being of animal and human around oil extraction alike would go quite a way to preventing disasters. But equally nothing requires us to accept a system of “publick vices, private benefits”. If the costs of the oil extraction and transport by companies such as ExxonMobil and BP are to be borne by the people, then surely the profits of such enterprise are to go to the people as well. Capitalism’s relentless drive to accumulate at the expense of anything else has driven many an ecosystem to the brink of total breakdown, and nowhere is this more clear than in the obsessive quest to find the last little bits of trapped sunlight to fuel our machines. These same machines end up killing us, poisoning our water and air, destroying our forests and wetlands, and endanger our climate. This we are told we must accept as part of the system. And indeed, they bring many benefits and comforts too – and yet we are told that we have no right to claim any share in those? Even as they expropriate nature of her prized possessions, so they attempt to expropriate us of a fair share in the wealth engendered by modern technology. But when things go wrong, we are presented with the bill. Do we continue to accept this? Shall we not expropriate the expropriators in turn?

1) Erica Werner, “Federal law may limit BP liability in oil spill”. Associated Press (May 3, 2010).
2) Wayne Madsen, “The Cover-up: BP’s Crude Politics and the Looming Environmental Mega-Disaster”. http://oilprice.com/Environment/Oil-Spills/The-Cover-up-BP-s-Crude-Politics-and-the-Looming-Environmental-Mega-Disaster.html

Leave a Comment

Your email address will not be published.