It’s arithmetic: $4.5 billion is small change for BP
Let me apologise in advance for all the numbers that follow, but they’re important.
Eleven men died on Deepwater Horizon the night BP’s Macondo well blew out in April 2010. It’s one number we shouldn’t forget and no number can be placed on the loss their families and communities suffered and continue to suffer.
The number announced on Thursday – US$4.5 billion – represents BP’s criminal settlement with the US government and a victory for the giant oil corporation.
How’s that a victory? It’s a victory because BP’s stock price rose and since stock price is the only number that means anything to people who run oil companies, it tells us today’s settlement was a reward, rather than a punishment, for BP.
Here’s another number – $5.5 billion. That’s how much BP profited in the third quarter of this year, or a billion dollars more than they’ll have to pay out.
The criminal penalty imposed on BP today fails every commonly accepted definition of penalty. Theoretically, we impose criminal penalties to punish the guilty, but as noted above, BP was rewarded rather than penalised.
Penalties should protect the innocent and deter other would-be criminals from taking similar actions; that’s why we put non-corporate people in jail. This penalty does neither because the message it sends to other oil companies. Nothing in this settlement gives any oil company incentive to be more careful in future operations. Cutting corners and skimping on safety will still be the rule of the day.
The fine is roughly equal to what Shell Oil has spent so far in its attempts to drill for oil in the Arctic and it has yet to sink its first well. When – not if – the inevitable well blowout, oil spill or other major incident occurs in that fragile environment far from any means of control or clean up, the executive at Shell can rest assured that the US federal government remains as toothless as it was for Exxon in 1989 and BP in 2010.
That’s what we have for numbers, but as ever, numbers don’t tell the whole story. Not even half of it. As my colleague John Hocevar notes: “The price of one sperm whale in the gulf is immeasurable and we still don’t know the full ecological story of the BP Deepwater Horizon Disaster. This settlement buys off further government silence about the full impacts. The Gulf deserves a full accounting for the damage BP has done, and this settlement is simply BP trying to buy its way out of responsibility.”
2012-11-16 10:42:38
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