I hate to post a Fox News link , but here it goes.
https://www.foxnews.com/politics/2010/05/27/obama…
I can't help but notice that the public's hate for BP may be eclipsing that of bankers. Let's look at the similarities of the situation.
- Banks - Banks get rich from selling risky mbs. These securities never have problems, but when they do the results are catastrophic.
Oil - BP pumps in the cash from risky off shore drill stations. These stations never have problems, but when they do the results are catastrophic.
- Banks - Credit markets blow up, equities blow up, recession hits with no end in site.
Oil - The impossible happens. The drilling site explodes and sends oil to shore with no end in site.
- Banks - The government responded with TARP. Banks are recapitalized and return to being profitable entities.
Oil - I guess for this to complete the analogy, the gov't will have to pay for clean up, BP will repay the gov't and then bitch about it for the next 3 years.
- Banks - The gov't forms legislation that over restricts the banks as a overreaction to the event. Overall negative impact on the economy.
Oil - Gov't will pass legislation that over restricts riskier energy sources, raising costs and hurting the economy overall.
Neither the banks nor BP internalized the risk/cost of the true downside case. I guess I'd like to be the first in welcoming BP employees to the club.
BP - you can print more money, but you can't print more environment
BP shareholder here. You also can't print more oil.
For better or for worse, the economy runs on energy. And energy always has a cost- sometimes, it carries an environmental one.
I'm angry at the company for having such a lackadaisical attitude about safety, but the environment will recover. It recovered in Prince William Sound; it will recover in the Gulf. IMHO, the big difference is that BP has accepted responsibility; apparently, they lost the page in the corporate disaster playbook where you're supposed to avoid taking responsibility for anything.
The arguement over economic progress and protecting the environment is too large to get into... I'm not an environment nut and not a huge activist, I just really hate a company that didn't take simple preventative steps and took the environment for granted. I'm not sure how much damage it will cause, if the gulf wildlife recovers, great, but just the fact that BP is messing with something that could be irreversible is why I really hate them. In defense for bankers at GS, we live in a capatalistic world and if they want to sell crap to people that buy the crap, then by all means they should be allowed to do so. Economies go into recession and come out - its normal - I think the public is just looking to point fingers and its fun to point the finger at a company that got rich selling crap.
Now, about needing oil to feul the economy, thats fine... BP could have done it more safely like how other companies like Exxon do it. And from what I have read and heard, there is plenty of oil reserves left so we probably wont run out anytime soon. And when it comes that time when we will be running out - there will finally be a REAL push to develop other energy technologies.
Bottom line - BP put more than itself on the line with this oil spill, they put the health of Gulf wildlife communities and there is a potential for the oil to spread across the ocean - something which cannot be cleaned up. GS on the other hand, I would argue the system was flawed and GS just tried to exploit it as much as possible - in other words - capitalism.
Wow. Everything you have ever said has been completely and totally invalidated. Safe like how Exxon does it? Are you kidding me?
http://en.wikipedia.org/wiki/Exxon_Valdez_oil_spill
You are a complete and utter moron.
I have worked with BP (outside of the US) and they are the most safety obsessed company I have ever seen. Admittedly I have not worked with any other big oil co, but the fixation all the BP staff had with safety was extremely striking.
Well there is your problem, every company in Big Oil is beyond SAFETY SAFETY first. You have to be, to operate in such an environment. All my friends who are chemical engineers at the Majors have to through insane amounts of training. Thats what comes with making ridiclous profits for 'X' years. While BP has been pushing the safety expectations behind their latest CEO in the last 5 years very hard to fix their old reputation.
This spill is yet another example that BP still has people within the organization are too much of a risk taker compared to the other majors. This is why BP owns some of the most valuable assets in the industry but also is known to cut corners again again. Also they are always every 2-3 years due for a big lawsuit here or there.
The difference is this time they have lost control of the situation. Now this past weekend you have articles out that Exonn's bankers are sure running the numbers, another couple months of BP's stock falling and no end in lawsuits. Makes a takeover a possibility.
I'm assuming you're asking who is more hated in the eyes of the public?
GS - Though overdone and misconstrued since they never received bailout money (directly) a lot of people were/are still pissed at bonus pools. BP execs I'm sure make some sweet change, but your average engineer with 5-7 years of experience is not making much over $200K as opposed to a senior assoc/VP who is walking away with a cool $250K at the least. Bottom line, other than those who are near GOM (Gulf of Mexico) who probably despise BP, most people still carry the pitchfork for GS employees.
The only thing I'm pissed about is the fact that an experienced worker on that rig went so far as to get physical with a BP corp rep about them cheapening the shit out of that hole and they went through with it anyways.
The Government created both of those monsters so I think the most hated should be the White House. For one, allowing large corporations to contribute to political campains is an obvious recipe for disaster. BP donated big time to Obama and we see how well that relationship is going. It goes back to what I said before. Imagine a kid was alowed to eat until the point he looks like a Walrus. Do you hate the kid for becoming obese or do you blame the parents since they were the ones who were supposed to be the disciplinarians not allowing him to be so wreckless?
Well, again, I think the difference is that BP isn't being accused of doing anything with ill-intent. They're accused of doing things that were stupid and unsafe, but not deliberately doing something wrong. The equivalent for GS would be them coming along, shorting coastal real-estate, and then deliberately causing an oil spill.
Great article about where the celebrities are for this disaster...
http://www.aolnews.com/nation/article/george-clooney-bono-and-other-cel…
lol, that's really funny, chances that he meant that sarcastically?
Judging by his statement that we need "to feul the economy" with oil, instead of "fuel" it, I posit the supposition that he was, and remains, completely serious.
Fair enough, that's what I get for giving someone the benefit of the doubt once in a while...
to continue the analogy, both industries have regulators who are from industry or go to industry afterwards. the revolving door needs to get stopped or else regulators will constantly be asleep at the switch (MMS, SEC, etc)
I don't wish to apportion blame, as I am an expert on neither deep-sea engineering nor the oil industry, and would doubtless end up sounding like Carl Levin speaking on Goldman.
However, I must confess to find myself rather unsympathetic with the rank hypocrisy on display in America. We are more than happy to get oil delivered to us at below societal marginal cost (that is, without adequate expenditure on worker safety, or account taken of the resultant negative externalities), but as soon as something goes wrong, we are all too ready to apportion blame. This spill is not BP's fault; it is, just as the housing bubble was, the fault of greedy consumers. That is not, however, what I consider to be most odious here. Rather, what I find disappointing is the outrage we can summon for a disaster in our backyard (NIMBY), while ignoring worse disasters elsewhere. Do we really think this is worse than the petro-dictators, terrorists, and assorted wars our oil consumption directly or indirectly supports?
Personally, I'd be perfectly happy in a world where the oil price reflected its true cost, from an environmental, political, safety, and long-run drawdown perspective, whether that is $150 or $500 a barrel. I certainly don't want to say BP is a "victim," but I do at the least expect intellectual consistency in our thinking. If we want cheap oil, fine; I think it's a stupid, short-run choice, but we should at least recognize there is a price to pay one way or the other. We've simply chosen to pay FEMA rather than at the pump.
OK. Everyone needs to take the troll hats off.
My take on this:
-Accidents happen. -In a boring industry like oil, utes, or even finance where big problems are exceptionally rare, it's incredibly easy for employees to start getting lax about safety/compliance. Been there with finance and lifeguarding before that. It's hard to be vigilant about compliance when the firm hasn't had a serious accident in five years and "It won't happen to me" comes into play.
Exxon actually has had a reputation for being safe for the past ten years in oil investor/industry circles, ironically enough, so I have a suspicion that Sam might be a little more familiar with this subject than we think. Maybe in 30 years, Exxon's newer reputation for safety will overcome the Valdez in wider circles.
The biggest irony of this all is that Ken Salazar, the man saying "We need to reform MMS and keep the boot on the neck of BP" was the same guy who six months ago showed up at a ceremony to give the rig an award for safety.
Basically the point I'm making; I'm not picking on Exxon, I'm just saying claiming something is perfectly safe is not reasonable.
There is risk involved in nearly everything... driving, walking down the street... etc., however, you can drive safe vehicles, such as a Volvo instead of driving Motorcycle, and you can look both ways instead of crossing the street blindly, the point here is that the activities BP was doing were DEEMED unsafe and the company knew it. Exxon had learned its lesson after Valdez and they have been following strict safety guidlines ever since.
Now going back to the original question asked - BP knew that its drilling techniques are unsafe and could potentially lead to a huge catastrophe. Furthermore, drilling timelines on the Gulf oil rig were not being met, therefore the rig operator, Transocean, was given a directive from BP to speed things up which included bypassing even MORE safety features. When you look at the facts, what BP did is almost criminal – they knew they were sacrificing important safety measures, whereas GS and other banks were operating on information available at the time which did not depict the extent of the fallout.
BP - You can't print environment nor oil!
This is going to have a devastating impact on the Southern coastal economies. Tourism: fucked. Fishing/shellfish industry: fucked. Real estate: devastated even more than it already is (think of all the rental properties owners will be forced to short sell/foreclose). The point is, this is going to affect many.
I think it's funny that Obama criticized Bush's response to Katrina when he was campaigning, and his response to this disaster leaves much to be desired. I'm not comparing the severity of the two disasters (and I'm definitely not saying these disasters are either Presidents' fault). However, can one say BP's approach to containing this has always been aligned with the protection of our boarders? Wasn't their first response one that attempted to save some of the oil, rather than simply "plugging" the leak? I understand some of the most intelligent engineers are at BP, but their interests aren't aligned with ours, and our Gov't should be stepping in with their resources/hired 3rd parties for the protection of our boarders (I'm usually not an interventionist, but I think this situation falls under the constitutional duties of government).
Boarders? I assume you mean borders, in which, I'm still not sure what you mean.
Anyway, I understand that BP's interests may not be perfectly aligned with the public's, but I think the issue of plugging the well is simplistic enough and BP's interests are closely enough aligned that putting another layer of bureaucracy in the way is unlikely to help; MMS and FEMA have scarcely covered themselves in glory of late (or ever). The alternative is drafting BP's engineers in to the military, which is not terribly likely to help either, would basically amount to political showmanship, and would be of extremely dubious legality.
The issue of allowing BP to continue to lead the clean-up efforts, though, is a more robust case, where BP's interests and the public's at large are very clearly not aligned, as the use of the dispersant spray demonstrated.
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