Thursday, June 17, 2010

USD 20B is a lot of money to make "real change".

BP today agreed to put aside an enormous amount of money to begin to meet with claims for damages resulting from the Deepwater Horizon disaster.

Claims and Damages.

Well, the damage has been done, and no doubt that a lot of good people are struggling to get by as a result of the disaster. Whether it be because the government is now forbidding them from drilling more wells, or from oil-damage to fisheries and wildlife, or from tourists staying away from tar-stained beaches, your pain and struggle is real and it is justified to look towards your government for help and to point the finger at the company that seems to be the immediate cause of the pain.

But... What if your government would come to your beaches and inspect your fisheries and it would say that, yes, the damage is done and it is irreversible and effects will be lasting for decades to come.

What if they would say that, given this conclusion and such impact, which is scientifically verifiable, and economically calculable, it is no longer feasible for you to expect to continue to work in fishing, tourism, or the oil industry here?

What if, rather than calculate your expected wage for the next several decades (which is unlikely in itself to last that long, given job security in these times), put a multiplier to that as a form of civil liability compensation, and deposit the resulting amount in your bank account, the government would pay said wage for a year, maybe two, and in addition invest in the creation of new industries and fund education required for these?

Would you accept such a conclusion? And would you support such a policy of redevelopment, rather than direct compensation?

Who knows, maybe the Gulf Coast can become, rather than the US's region with the youngest general retirement age, the region with the highest environmental awareness, and it's "silicon valley" of alternative energy research? As far as I can tell it has plenty of sunshine, plenty of coastline, and they seem to have an excess in wind. Though that last may be seasonal and/or partly caused by a recent upsurge in political rhetoric.

How about creating a new National Park? Preferably in a previously thriving nature area, which is now hit the worst with oil. Name it the Natural Crude Recovery National Park. Or perhaps the Thad Allen National Park, as his work is undoubtedly tireless, frustrating and ungrateful, and a monument to nature's long-lasting recovery in his name would definitely not be an insult.

Do not clean up the oil in this set-aside region, but allow it to recover naturally. Let scientists and National Park Service manage the area like they do the Mt. St. Helens National Vulcanic Monument, as a testament and case study into how long it takes for nature to recover from a cataclysm, though this one be of man's own hand.

Both the park and the redeveloped regional industry would be a lasting monument to our folly. And to America's ability to deal with adversity in a constructive manner.

How about funding a real, hands-on, estimate of what it will take to clean up the mess? Then fund a study in what it will cost to re-develop the region's industrial sector. I fear that such studies, realistic studies, will show that a "clean-up", i.e. a return to how things were before, cannot be bought with any amount of money, simply due to the irreversible nature of some of the damage done. An egg, once boiled, will never again hatch a chick.

I fear that a balance sheet like that will show that, financially, it will be more feasible to re-invent the region's major industry.

But I also fear that the focus on individual gains of the American People at large and a culture of liability and lawsuits will prevent this money to be turned into "real change".

BP, who would probably never have chosen voluntarily to invest this kind of money in sustainability on such a short notice (their website claims they had invested USD 4B in sustainable energy since 2005 and aim to have invested USD 8B by 2015 [1]), will now find itself chucking this enormous wad of cash down the proverbial well of civil liability in an attempt at a societal Top-Kill of the gusher of damage-claims. They had some encouraging results with that approach to the real leak as well...

But unlike the purely, deterministically, physics-driven upward pressure of the oil-well, this gusher has a choice in whether it will blow-out or not...

[1] BP's page on "Our low-carbon business"
[2] "BP Ultimate" image retrieved from BP's website's press kit